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10c116c5-127f-4040-a5ff-fb1be3997633 | Henry v. Georgia-Pacific Corp. | 730 So. 2d 119 | 1970867 | Alabama | Alabama Supreme Court | 730 So. 2d 119 (1998)
Robin HENRY
v.
GEORGIA-PACIFIC CORPORATION and Johnny Hurst.
1970867.
Supreme Court of Alabama.
December 18, 1998.
Rehearing Denied March 12, 1999.
W. Lee Pittman and Robert Potter of Pittman, Hooks, Dutton & Hollis, P.C., Birmingham, for appellant.
Ralph D. Gaines, Jr., of Gaines, Gaines & Rasco, P.C., Talladega; and Jeffrey A. Walker of Butler, Snow, O'Mara, Stevens & Cannada, P.L.L.C., Jackson, MS, for appellees.
KENNEDY, Justice.
The plaintiff, Robin Henry, appeals from a summary judgment in favor of the defendants Georgia-Pacific Corporation and Johnny Hurst. The trial court made that summary judgment final pursuant to Rule 54(b), Ala. R. Civ. P.
In order to enter a summary judgment, the trial court must determine that there is no genuine issue of material fact and that the moving party is entitled to a judgment as a matter of law. Rule 56(c), Ala. R.Civ.P. In determining whether a summary judgment was properly entered, the reviewing court must view the evidence in a light most favorable to the nonmovant. Travis v. Scott, 667 So. 2d 674 (Ala.1995).
Viewed most favorably toward the plaintiff, the evidence suggests the following: Robin Henry was employed by Georgia-Pacific. Georgia-Pacific had a contract with Zwiebel & Associates, Ltd. ("Zwiebel"), a management and consulting firm. Zwiebel was in charge of conducting employee training for Georgia-Pacific. Zwiebel hired Dr. Charles Ted Deeble. Dr. Deeble conducted some of the training and was in charge of one-on-one counseling sessions with the employees. The counseling sessions were to be business-related, according to Zwiebel; however, its president acknowledged that it never specifically told Dr. Deeble to limit the one-on-one sessions to business-related matters. (C.R. 522-23.)
According to Dr. Deeble, one of the rules for the one-on-one sessions was that the employee would select the topics for discussion. (C.R.543-44.) Georgia-Pacific never placed any restrictions on the subjects that could be discussed in the individual sessions. (C.R. 550.) Perry Nelson, the plant manager for *120 Georgia-Pacific, told Mrs. Henry that she was to meet with Dr. Deeble. (C.R.548-49, 557.) Nelson placed no restrictions on the topics that could be discussed at the sessions. (C.R.559.)
Dr. Deeble had helped some of the other employees quit smoking. (C.R.312, 317.) Mrs. Henry asked Dr. Deeble to help her quit smoking and to help her learn to relax. Another employee had told Mrs. Henry that Dr. Deeble used hypnosis to help stop smoking. (C.R.665.) At her first session with Dr. Deeble, Mrs. Henry had a positive experience with hypnosis and practiced self-hypnosis techniques.
Dr. Deeble admitted that, during a later session, he asked Mrs. Henry if she was able to achieve an orgasm with her husband. (C.R.569.) While he hypnotized Mrs. Henry, Dr. Deeble told Mrs. Henry that she was "getting horny." (C.R.335.) Dr. Deeble acknowledged that, during one session, Mrs. Henry reported that she had an orgasm-like experience during the hypnosis. (C.R.548-49.) Dr. Deeble said he was unsure whether he told Mrs. Henry that he was "getting horny." (C.R.551-52.) He admitted that he told Mrs. Henry how to experience an orgasm by imagining sexual intercourse with her husband and how to "become more responsive overall in a sexual manner." (C.R. 553-54, 220-21.) Dr. Deeble said that he may have told Mrs. Henry that he had helped other employees with sexual problems. (C.R.560-61.)
Mrs. Henry testified that she understood the purpose of the sessions to be to help the employees have a better attitude. (C.R.631.) She said her supervisors told her that "everybody would be involved and [that] we needed to cooperate fully." (C.R.632.) Plant manager Nelson stated to Mrs. Henry, "[Y]ou will cooperate or you don't have a job." (C.R.633.)
Mrs. Henry told Johnny Hurst, a supervisor, about Dr. Deeble's questioning her about orgasms, seeking his help in the matter. (C.R.649, 658, 660, 672-74.) Mrs. Henry then tape-recorded her next session with Dr. Deeble. She played the tape for Hurst so that he could listen to Dr. Deeble asking her to take off her shirt. (C.R.659.) Randy Youngblood, an assistant plant superintendent, came in and told Mrs. Henry that Dr. Deeble was "sweet on [her]." (C.R.650-53.) Youngblood told Mrs. Henry that she had to continue with the sessions or else lose her job. (C.R.661, 663, 666-67.)
Mrs. Henry stated in her deposition that she did not want to continue with the individual sessions but that she feared losing her job if she refused to see Dr. Deeble or refused to cooperate with him during the sessions. (C.R.654-55.) Johnny Hurst advised Mrs. Henry to say nothing about the one-on-one sessions if she wanted to keep her job. (C.R.662-63.) Mrs. Henry continued with the sessions until Dr. Deeble stopped coming to the plant.
Mrs. Henry sued Georgia-Pacific, Zwiebel, Dr. Deeble, and Johnny Hurst. In her complaint, Mrs. Henry sought to hold Georgia-Pacific vicariously liable for Dr. Deeble's acts. She also alleged a direct cause of action, based on the tort of outrage, against Georgia-Pacific and Johnny Hurst for requiring her to see Dr. Deeble. (C.R.19-20.) Georgia-Pacific and Johnny Hurst filed a joint motion for summary judgment. Mrs. Henry abandoned her vicarious-liability claim against Georgia-Pacific and Johnny Hurst and argued that their legal accountability arose out of insisting that she continue meeting with Dr. Deeble after she had reported what had occurred during the sessions.
The trial court entered a summary judgment for Georgia-Pacific and Johnny Hurst, based on Hendley v. Springhill Memorial Hospital, 575 So. 2d 547 (Ala.1990). The claims against Zwiebel and Dr. Deeble are still pending in the trial court.
In Hendley, we affirmed a summary judgment in favor of a hospital in a situation where an independent contractor of the hospital had performed an unnecessary vaginal examination. In Hendley, the hospital did not know of the independent contractor's actions. However, in this present case, the evidence indicates that Georgia-Pacific was told of Dr. Deeble's alleged improper sexual conduct and demanded that Mrs. Henry continue with the sessions or else lose her job.
*121 Egregious sexual harassment can amount to the tort of outrage. Busby v. Truswal Systems Corp., 551 So. 2d 322 (Ala. 1989). In Busby, a supervisor repeatedly subjected the plaintiffs to sexually harassing comments. The plaintiffs told management in general terms of the harassment, but did not initially give the details or the full extent of that conduct, and the plaintiffs did not give management time to correct the situation. This Court held that the company was not liable on the claim of outrage, based on those facts. Unlike the plaintiffs in Busby, Mrs. Henry notified a supervisor of the specific comments made by Dr. Deeble and even let him listen to a tape-recording of the comments.
Viewing the facts in the light most favorable to Mrs. Henry, as we are required to do, we conclude that the summary judgment must be reversed. A jury could reasonably determine that Georgia-Pacific and Johnny Hurst's conduct was outrageous that Johnny Hurst, working as a supervisor, was told exactly what had occurred during the sessions; that Georgia-Pacific, with prior knowledge, required Mrs. Henry to continue counselling sessions at which improper sexual conduct was occurring; and that they made Mrs. Henry's job dependent upon her attending those sessions.[1]
REVERSED AND REMANDED.
HOOPER, C.J., and ALMON, SHORES, COOK, and LYONS, JJ., concur.
MADDOX, J., dissents.
HOUSTON, J., recuses himself.
MADDOX, Justice (dissenting).
Because I believe the facts of this case fall within the purview of this Court's decision in Busby v. Truswal Systems Corp., 551 So. 2d 322 (Ala.1989), and specifically because I do not believe Ms. Henry presented substantial evidence indicating that Georgia-Pacific had sufficient knowledge of Dr. Deeble's actions to satisfy the elements of the tort of outrage, I dissent.
Although the majority has outlined most of the relevant facts of this case, I wish to discuss some of them in more detail. The evidence indicates that the lurid session with Dr. Deeble occurred on April 7, 1992. Afterwards, Ms. Henry spoke with supervisors Johnny Hurst and Randy Youngblood about the incident. Ms. Henry considered Hurst a friend and spoke with him often about personal topics. Also, Ms. Henry stated in her deposition testimony that when she discussed the incident with Hurst she thought it was understood that the conversation was confidential. As for Youngblood, Ms. Henry testified that she may have told him to keep the conversation confidential. After the April 7 incident, Ms. Henry attended sessions with Dr. Deeble approximately three more times. Ms. Henry did not attend any sessions with Dr. Deeble after May 1992. In May 1993, Ms. Henry contacted an acquaintance at the Atlanta, Georgia, headquarters of Georgia-Pacific and related the incident to him. Approximately one week after that call, Ms. Henry was interviewed by a member of Georgia-Pacific's human resources staff. Soon thereafter, she was informed by Georgia-Pacific that Dr. Deeble had been taken out of the program.
In Busby v. Truswal Systems Corp., 551 So. 2d 322 (Ala.1989), this Court dealt with issues and facts very similar to those presented here. In Busby, some female employees brought an action against Truswal Systems Corporation, their employer, alleging invasion of privacy and the tort of outrage. *122 Their outrage claim centered on accusations that one of their supervisors, Deaton, had "repeatedly subjected them to sexual harassment." Id. at 323. The employees related their accusations to Fairley, a supervisor. Id. at 323. One of the employees, Pitts, was a personal friend of Fairley. Id. at 326, n. 1. Fairley's testimony contradicted much of Pitts's testimony. Id. at 327. The trial court entered a summary judgment in favor of Truswal, and this Court affirmed, stating
Id. at 327. This Court further stated that in order to establish outrageous conduct by a corporate defendant, it must be shown that the conduct "was perpetrated as a means to further the defendant corporation's business," or that a jury could conclude that "`this is the way the company does business.'" Id. at 327. This Court concluded that "Deaton's conduct was aimed purely at satisfying his own lustful desires; no corporate purpose could conceivably be served by his overtures," and that, based on these facts, Truswal could not be "held liable as having ratified Deaton's alleged outrageous conduct." Id. at 328.
This case, like Busby, should turn on the kind of knowledge the corporate defendant had. This Court's recent decision in H.M. v. Jefferson County Board of Education, 719 So. 2d 793 (Ala.1998), discusses the principle of vicarious and respondeat-superior liability in a sexual-harassment context and discusses the circumstances under which an employer can be held liable for the acts of its agent.
In H.M., this Court dealt with a claim by parents, on behalf of their minor child, alleging same-sex sexual harassment by one of their child's teachers. In affirming a summary judgment in favor of the Jefferson County Board of Education, we stated:
719 So. 2d at 796.
It is undisputed that Ms. Henry imparted specific information to two supervisors, one of whom, as in Busby, was a personal friend. However, this case contains the additional fact that Ms. Henry expressly or impliedly suggested that her conversations with these supervisors should remain confidential. While those supervisors could be accused of bad judgment in not presenting the matter to officials of the company, their inaction, considered in light of Ms. Henry's desire to keep the incident confidential, does not establish the tort of outrage. It appears to me, given these facts, that Georgia-Pacific's conduct should not be construed as ratification of Dr. Deeble's actions or construed as suggesting that the corporation carried on its business in disregard of the welfare of its employees. On the contrary, it appears that when its corporate headquarters was notified, Georgia-Pacific took quick action to remedy the situation.
551 So. 2d at 327. While I agree that Dr. Deeble's alleged conduct was deplorable,[2] I cannot agree, based on the evidence presented in this case, that Georgia-Pacific could be said to have had the kind of knowledge required to make it vicariously liable for Dr. Deeble's alleged outrageous conduct. I believe Ms. Henry has failed to present substantial evidence establishing a genuine issue of material fact in that regard. Consequently, I respectfully dissent.
[1] Justice Maddox urges in his dissent that Georgia-Pacific should be insulated from liability by reason of Henry's understanding that her communications to her supervisors at Georgia-Pacific were confidential. However, the record reflects that, as to whether Hurst was to keep those communications private and confidential, Henry testified, "I don't know that it was my understanding." As for her communications to Youngblood, Henry said she "may have" told him to keep the conversations confidential. Moreover, even if Hurst and Youngblood, in support of Georgia-Pacific's motion for summary judgment, had offered evidence indicating that they had not communicated any information concerning their discussions with Henry and that their failure to do so was based on the understanding of confidentiality, the credibility of that evidence would be an issue for the jury. Under these circumstances, a jury question exists as to the knowledge of Georgia-Pacific.
[2] As the majority opinion indicates, Ms. Henry sued Dr. Deeble in this same action and her claim against him, based on the same alleged conduct we have considered in this appeal, is pending in the circuit court. | c4a58e78377d31a83b0bd45928b94689b5705d3fe0961021563a4ebaa76eedf9 | 1998-12-18 00:00:00 |
9c156971-ff9e-4426-affa-29582d0c8c1e | Ex Parte Be&k Const. Co. | 728 So. 2d 621 | 1970692 | Alabama | Alabama Supreme Court | 728 So. 2d 621 (1998)
Ex parte BE&K CONSTRUCTION COMPANY.
(Re Victor Bussen
v. BE&K Construction Company).
1970692.
Supreme Court of Alabama.
December 11, 1998.
*622 Richard W. Franklin of Armbrecht, Jackson, DeMouy, Crowe, Holmes & Reeves, L.L.C., Mobile, for petitioner.
Bob Sherling of Sherling, Browning & York, P.C., Mobile, for respondent.
Carl Robert Gottlieb, Jr., of Reams, Philips, Brooks, Schell, Gaston, Hudson & Gottlieb, P.C., Mobile, for amicus curiae Municipal Workers Compensation Fund, Inc., in support of the petitioner.
MADDOX, Justice.
We have granted certiorari review to consider the judgment of the Court of Civil Appeals in this workers' compensation case. See Bussen v. BE&K Construction Co., 728 So. 2d 617 (Ala.Civ.App.1997). The single legal issue presented is whether an employer is statutorily entitled to subrogation to recover medical-benefits payments it has made and those it will be obligated to make in the future, or whether the employer's right of subrogation applies only to the amounts already paid.
The dispute between the employer and the employee involves an interpretation of § 25-5-11(a), Ala.Code 1975,[1] which authorizes an injured employee or the employee's dependents to bring an action against a third-party tortfeasor while concurrently maintaining an action against the employer for workers' *623 compensation benefits, but which also provides that "the employer shall be entitled to subrogation for medical and vocational benefits expended by the employer on behalf of the employee."
Victor Bussen sued his employer, BE&K Construction Company, seeking workers' compensation benefits. The trial court stayed proceedings on his workers' compensation claim pending the outcome of his action against a third-party tortfeasor based on the same incident that was the basis for his workers' compensation claim. Bussen subsequently settled the third-party action for $160,000. When the settlement was reached, BE&K had paid to Bussen, or had paid on his behalf, temporary disability benefits and medical expenses totalling approximately $16,000. Pursuant to the provisions of § 25-5-11(a), Bussen paid $10,698.65 to BE&K, in alleged satisfaction of BE&K's subrogation rights under the statute.
BE&K wrote a letter to the trial court, contending that its obligation to pay any future medical expenses should be suspended until Bussen had exhausted the settlement proceeds from the third-party action. The trial court not only denied Bussen's claim for future medical expenses, but dismissed his workers' compensation case. The effect of the trial court's ruling denying Bussen any future medical benefits was to grant BE&K relief beyond what it had requested and was adverse to Bussen. Bussen appealed. The Court of Civil Appeals reversed the judgment of the trial court, holding that under the provisions of § 25-5-11(a) BE&K was not entitled to be subrogated as to any medical benefits it might be required to pay in the future. BE&K petitioned for a writ of certiorari, which this Court granted.
This case involves a question of legislative intent, and in ascertaining legislative intent we apply traditional principles of law. This Court has previously stated that in construing a statute "the fundamental rule is that the court has a duty to ascertain and effectuate legislative intent expressed in the statute, which may be gleaned from the language used, the reason and necessity for the act, and the purpose sought to be obtained." Ex parte Holladay, 466 So. 2d 956, 960 (Ala. 1985), citing Shelton v. Wright, 439 So. 2d 55 (Ala.1983). With this principle in mind, we have examined the language used by the Legislature and have considered the purpose the Legislature had in mind when it adopted its 1992 amendment to the Workers' Compensation Act (see note 1). We hold that § 25-5-11(a) applies to future medical benefits that have not been paid, but which the law requires the employer to pay. The language of the 1992 amendment indicates that by that amendment the Legislature intended to provide the employer full subrogation to the extent the injured employee recovers damages from a third-party tortfeasor. Section 25-5-11(a) states, in pertinent part, that "the employer shall be entitled to subrogation for medical and vocational benefits expended by the employer on behalf of the employee." The use of the word "expended" indicates to us that the Legislature contemplated subrogation as to all medical benefits paid, regardless of when such benefits were paid. We can draw no inference from the statutory language or from the presumed purpose of the statute that would indicate that the Legislature, by using the word "expended," intended to allow the employer subrogation as to those expenses it had already paid, but not as to those amounts it is legally required to "expend" in the future.
A number of states have enacted statutes specifically providing the employer or its insurer subrogation as to the amounts it pays for the employee's future medical expenses. See, e.g., Conn. Gen.Stat. § 31-293 (1997); Del.Code Ann. tit. 19, § 2363 (1995); Fla. Stat. ch. 440.39 (Supp.1998); Mich. Comp. Laws § 418.827 (Supp.1998). In situations, however, where state legislatures were not as precise in dealing with the issue of subrogation rights, courts have held that an insurer may withhold payment of future medical benefits until the recovery from a third-party tortfeasor is exhausted, at which time the insurer would resume payment. See Bilodeau v. Oliver Stores, Inc., 116 N.H. 83, 352 A.2d 741 (1976); and Richard v. Arsenault, 349 Mass. 521, 209 N.E.2d 334 (1965). Further, Professor Larson, in his treatise on workers' compensation, reasons that "if the statute does not take pains to deal explicitly *624 with the problem of future benefits, but merely credits the carrier for compensation paid ... the correct holding is still that the excess of the third-party recovery over past compensation actually paid stands as a credit against future liability of the carrier." A. Larson, Workmen's Compensation Law, § 74-31(e), p. 14-471 (1989 & Supp.1990).
We conclude that the Legislature, by using the word "expended," did not intend to limit subrogation to benefits that had been paid, but intended, as Professor Larson suggested, that the excess of the third-party recovery over the amount paid in past medical and vocational benefits should stand as a credit against future liability. Stated differently, we believe the Legislature intended that the law of subrogation apply. This Court has held:
Powell v. Blue Cross & Blue Shield, 581 So. 2d 772, 774 (Ala.1990) (citations omitted); quoted in American Economy Ins. Co. v. Thompson, 643 So. 2d 1350, 1352 (Ala.1994).
We conclude that the Legislature intended that in situations where the injured employee recovers from a third-party tortfeasor, the amount of that recovery attributable to the employee's medical or vocational expenses should be exhausted before the employer or its workers' compensation insurer is obligated to resume payment of those expenses. In reaching this conclusion, we recognize that when a workers' compensation claimant has also filed a third-party action, the parties in the third-party action should make a concerted effort to ensure that any recovery, whether by settlement or by trial, is fairly apportioned so as to designate how much of the recovery is attributable to medical (and vocational) expenses, both past and future. Therefore, it is in the capable hands of the trial judges presiding over the third-party actions to determine to their satisfaction the amount of each award in a third-party action to be attributed to the employee's medical (or vocational) expenses.
We reverse the judgment of the Court of Civil Appeals and remand this cause to that Court with instructions to have the trial court conduct a hearing to determine, using equitable principles applicable to subrogation rights, which part of Bussen's settlement is attributable to his medical expenses and thereafter to enter an order allowing BE&K subrogation as to that portion of Bussen's third-party recovery that is attributable to future medical expenses that BE&K would be legally required to pay. When the portion of the recovery that is attributed to future medical expenses is exhausted, BE&K will then be required to resume payment of medical expenses.
REVERSED AND REMANDED, WITH INSTRUCTIONS.
HOOPER, C.J., and HOUSTON, SEE, and LYONS, JJ., concur.
SHORES and COOK, JJ., dissent.
[1] "If the injury or death for which compensation is payable under Articles 3 or 4 of this chapter was caused under circumstances also creating a legal liability for damages on the part of any party other than the employer ... the employee... may proceed against the employer to recover compensation under this chapter or may agree with the employer upon the compensation payable under this chapter, and at the same time, may bring an action against the other party to recover damages for the injury or death, and the amount of the damages shall be ascertained and determined without regard to this chapter.... If the injured employee ... recovers damages against the other party, the amount of the damages recovered and collected shall be credited upon the liability of the employer for compensation.... For purposes of this amendatory act, the employer shall be entitled to subrogation for medical and vocational benefits expended by the employer on behalf of the employee; however, if a judgment in an action brought pursuant to this section is uncollectible in part, the employer's entitlement to subrogation for such medical and vocational benefits shall be in proportion to the ratio the amount of the judgment collected bears to the total amount of the judgment." § 25-5-11(a), Ala.Code 1975, as amended by 1992 Ala. Acts, Act No. 92-537, § 8. | 4f1c66408c52b7cf981905f43e61e6ee3df93a8fcde621c1799b2ff8a5e2babc | 1998-12-11 00:00:00 |
47ffdaff-6880-454d-8be2-1c2da9ec275e | Fielder v. USX Corp. | 726 So. 2d 647 | 1970979 | Alabama | Alabama Supreme Court | 726 So. 2d 647 (1998)
Felecia FIELDER et al.
v.
USX CORPORATION and Larry Dillard.
1970979.
Supreme Court of Alabama.
December 18, 1998.
*648 Michael D. Petway of McNamee, Snead & Mobley, Birmingham, for appellant.
William F. Murray, Jr., and Ricky J. McKinney of Burr & Forman, L.L.P., Birmingham, for appellees.
MADDOX, Justice.
The plaintiffs, Felecia Fielder and her minor children, appeal from a summary judgment entered in favor of the defendants USX Corporation and Larry Dillard, safety and security director of USX.
Clyde Fielder, the husband of Felecia Fielder, was employed as a train operator helper by the Fairfield Southern Company from 1989 until his death in 1995. Fairfield Southern is based in Birmingham and is engaged in the railroad industry. Specifically, Fairfield Southern is an independent contractor that performs industrial switching for United States Steel, a division of USX Corporation. All of Fairfield Southern's operations and services are conducted on property owned by USX.
On October 4, 1995, just before midnight, Clyde Fielder reported to work. His work site was known as the "Tin Mill 13" site. On that night, the remnants of Hurricane Opal were passing through the Birmingham area, causing severe weather that included high winds and heavy rain. Upon arriving at the work site, Fielder was ordered to assist in switching cars. James Martin Johnson, another employee of Fairfield Southern, was ordered to assist Fielder. Johnson was employed as a locomotive operator.
Both Johnson and Fielder were working at the entrance to the Tin Mill 13 site. USX employees were also working on that night. As part of their assignment, Johnson and Fielder were required to back a locomotive engine, attached to four cars, through a set of double doors and into a building located at Tin Mill 13. When Johnson and Fielder arrived, the double doors were shut and were held closed by a four-by-four timber. The two men opened the doors so as to move the locomotive and the attached cars into the building. The doors opened outward. Fielder opened the left door and secured it with the latch located on the door. The right door latch was broken, so Johnson and Fielder wedged that door open with the four-by-four, as they had done numerous times before.
Johnson then mounted the locomotive to begin moving it and the attached cars into the building. As they began to move, Johnson was located on the left side of the engine. Fielder was riding on the right side of the train near the rear of the end car. Although the employer had a rule against riding the car in this fashion, it was a typical practice for train operator helpers to ride the cars into the building. On the left side of the double doors was a sign that read "Danger no clearance for man on car."
While maneuvering the cars, Johnson could not see Fielder, but maintained radio contact with him. Johnson relied on Fielder to visually assist him in backing the cars.
Above the double-door entrance is a lighting mechanism that is operated by USX employees. The lighting mechanism has a red light and a green light that indicate whether the cars may enter the building. The green light indicates that the tracks inside the building are unlocked and are aligned properly so that cars may enter the building. The red light indicates the opposite. On the night in question, the green light was illuminated, both at the time Johnson and Fielder opened the doors and when they began shoving the cars into the building.
Johnson radioed to Fielder that he intended to shove the cars against the line located on the wall inside the building. Johnson testified that this meant that he was not *649 going to shove the cars all the way to the "block" located inside the building. Johnson radioed to Fielder that he should get down from the train, so that Johnson could shove the cars "to the line." Fielder radioed back, indicating that he would comply. That was the last radio contact Johnson had with Fielder.
As Johnson was positioning the cars, he heard the right door, which he and Fielder had wedged open, hit the side of the engine. Although it was not conclusively established, it appeared that the right door may have been closed as the end car was shoved into the building, and that Johnson realized something was awry only when the door hit the engine. Johnson radioed Fielder but received no reply. Johnson dismounted the train and saw Fielder's radio lying on the ground. He then discovered Fielder's body underneath the train. Apparently, Fielder had not dismounted the train and had been killed when he was knocked underneath the wheels.
Felecia Fielder, along with her minor children, filed a wrongful-death action against USX and Larry Dillard. The plaintiffs alleged in their complaint that the defendants had known or should have known that the premises where Clyde Fielder was injured were "unsafe, hazardous, defective and dangerous." Also, they alleged that the defendants had "negligently and/or wantonly maintained the subject premises" in such a dangerous condition and had "negligently and/or wantonly failed to warn" Mr. Fielder of the dangers.
To support these claims, the plaintiffs point to the condition of the latch on the right door. Specifically, they argue that the broken latch made the door unsafe and therefore contributed to Mr. Fielder's fatal accident. Additionally, they argue that USX literally "green-lighted" Johnson and Mr. Fielder's movement of the train cars into the Tin Mill 13 building. By illuminating the green light, the plaintiffs argue, USX communicated that it was safe to enter the building. To the contrary, USX argues, and the evidence supports its argument, that the green light indicated only that conditions were "safe inside the building."
During the course of discovery, Dillard testified that USX had conducted safety inspections of the premises in the area of the Tin Mill 13 site. Dillard testified that USX had inspected physical conditions and had observed the actions of the employees. Dillard also said that USX employees had discussed the matter of safety with the leadership of the various independent contractors, but not with the individual employees of the contractors.
Relying on Dillard's testimony, the plaintiffs also argue that USX and Dillard are subject to liability on the theory of negligent inspection. USX and Dillard argue that they conducted inspections for the benefit of USX employees working on the premises and that they did not specifically inspect the door area where Clyde Fielder was injured.
A summary judgment is proper if there is "no genuine issue as to any material fact and ... the moving party is entitled to a judgment as a matter of law." Rule 56(c)(3), Ala.R.Civ.P. "`In reviewing a summary judgment,... this Court will review the record in a light most favorable to the nonmovant and will resolve all reasonable doubts against the movant.'" Copeland v. Samford University, 686 So. 2d 190, 191 (Ala.1996) (quoting Diamond v. Aronov, 621 So. 2d 263, 265 (Ala.1993)). "In [reviewing a] summary judgment, we are limited ... to the ... factors considered by the trial court when it initially ruled on the motion." Barnes v. Liberty Mut. Ins. Co., 472 So. 2d 1041, 1042 (Ala.1985).
Both parties acknowledge the existence of this well-settled rule:
However, the plaintiffs rely on an exception to that rule as stated in Herston v. Whitesell, 374 So. 2d 267 (Ala.1979). In Herston, this Court stated that "`one who volunteers to act, though under no duty to do so, is thereafter charged with the duty of acting with due care.'" Id. at 270, quoting United States Fidelity & Guaranty Co. v. Jones, 356 So. 2d 596, 598 (Ala.1977). The plaintiffs point to two facts to support their contention that this exception applies in this case: First, the fact that USX operated the lighting mechanism; and second, the fact that the defendants conducted safety inspections. The plaintiffs argue that the evidence of these two facts constitutes
Because the USX employees illuminated the green light when, the plaintiffs say, it was, in fact not safe to enter the building, the plaintiffs argue that there is a genuine issue of material fact as to whether the defendants were negligent. Also, because the defendants had failed to correct the defective door latch, or to warn Clyde Fielder of it, the plaintiffs argue that the defendants conducted their inspections negligently and that this negligent inspection also creates a genuine issue of material fact for trial. We disagree.
First, although the evidence shows that USX controlled the lighting mechanism above the doors, no evidence suggested that a green light indicated that it was safe for the independent contractor's employees to enter the building. Instead, the evidence established that the green light indicated only that the tracks inside the building were properly aligned so that cars could enter the building. The facts are undisputed that the green light was illuminated when Johnson and Fielder arrived and the doors were closed. These facts support the defendants' argument that the lighting mechanism did not indicate the condition of the doors, but indicated the condition and positioning of the tracks inside the building. Therefore, there is no issue of fact to be determined.
Second, the negligent-inspection claim must fail also. This Court has held, that to establish negligent inspection, a "plaintiff must prove (1) that the defendant had undertaken to inspect the site, particularly the area in which the injury-causing hazard is located, (2) that the defendant performed such inspection negligently, and (3) that such negligence proximately caused the injuries." Alabama Power Co. v. Williams, 570 So. 2d 589, 591 (Ala.1990). No evidence in the record indicates that the defendants conducted inspections in the particular area where Mr. Fielder's accident occurred. Therefore, the plaintiffs did not carry their burden of proof as to the first element.
This Court has held that "[t]here is no duty to warn" an employee of an independent contractor "who has equal or superior knowledge of a potential danger." Alabama Power Co. v. Williams, supra, at 592. The evidence clearly shows, without contradiction, that Mr. Fielder knew of the condition of the right door, that on numerous occasions he had used a foreign object to prop open that door, and that he knew of the severe weather on the night of his accident.
The trial court properly entered the summary judgment for the defendants.
AFFIRMED.
HOOPER, C.J., and ALMON, HOUSTON, KENNEDY, SEE, and LYONS, JJ., concur.
COOK, J., concurs in the result.
SHORES, J., dissents. | 5ff5ec9dcbd3be0d2b25ccf8f7e173c3ce0571d4c7cc536bff8c9b1980d731f8 | 1998-12-18 00:00:00 |
c21fc4cc-e63f-4a90-b2f3-8d3065dca253 | Ex Parte DBR | 757 So. 2d 1193 | 1970987 | Alabama | Alabama Supreme Court | 757 So. 2d 1193 (1998)
Ex parte D.B.R.
(In re D.B.R. v. MOBILE COUNTY DEPARTMENT OF HUMAN RESOURCES et al.).
1970987.
Supreme Court of Alabama.
December 18, 1998.
*1194 Patricia W. Hall, Mobile, for petitioner.
J. Coleman Campbell and Lynn S. Merrill, asst. attys. gen., Department of Human Resources, for respondent.
HOOPER, Chief Justice.
This is a child custody case. We have granted certiorari to consider the judgment of the Court of Civil Appeals. See D.B.R. v. Mobile County Department of Human Resources, 757 So. 2d 1190 (Ala. Civ.App.1998).
D.B.R. and his wife both lost custody of their daughter three days after she was born. Both parents had a history of mental illness. The Department of Human Resources placed the child in the maternal grandmother's temporary custody. On April 31, 1996, the Department found the child to be dependent and placed her in the physical custody of the maternal grandmother, with the Department retaining temporary legal custody.
This case began on October 7, 1996, when both parents moved to establish visitation. Initially, both parents were represented by the same attorney, and a guardian ad litem was appointed for the child. The maternal grandmother, represented by her own counsel, sought custody. The mother and father disagreed with the custody petition filed by the grandmother, because D.B.R. himself wanted custody of the child. In seeking custody, D.B.R. requested a public defender to represent him. However, he did not file an "affidavit of substantial hardship." He merely stated that his yearly income was $5,500 and that he could not continue paying his attorney. The referee denied this request, and the trial court affirmed that denial. Subsequently, D.B.R. represented himself.
On March 10, 1997, based on the referee's recommendations, the trial judge awarded the maternal grandmother custody and awarded D.B.R. supervised visitation with the child. On March 18, 1997, D.B.R., acting pro se, filed a document styled "Appeal of Decisions of March 3, 1997." (The referee had conducted a hearing on March 3, 1997.) In that filing, he stated that it was made "on behalf of the minor child by the father." The trial court treated the filing as a petition for a rehearing pursuant to § 12-15-6(d), Ala.Code 1975. On April 4, 1997, the court denied the rehearing petition.
An attorney was appointed for D.B.R. for the purpose of an appeal. On April 17, 1997, D.B.R. filed an appeal to the Court of Civil Appeals from the order denying what he called "his motion to alter, amend or vacate" the court's order. The Court of Civil Appeals construed the March 18, 1997, filing as a motion for a rehearing or to alter, amend, or vacate the judgment and concluded that it had been deemed denied as of April 1, 1997, based on Rule 1(B), Ala.R.Juv.P. Based on that construction of the motion, the last day allowed for an appealthe 14th daywas April 15, 1997. Rule 28(C), Ala.R.Juv.P. Because D.B.R.'s appointed attorney had filed the notice of appeal on April 17, 1997, the Court of Civil Appeals dismissed the appeal as untimely. 757 So. 2d at 1192.
The first issue is whether the trial court erred in treating the document entitled "Appeal of Decisions of March 3, 1997" as a post-judgment motion for a rehearing. If so, and if it was properly to be treated as an appeal, we must consider whether it was timely filed. If it was, then we must consider whether the trial court erred in not appointing counsel for D.B.R. in the original trial.
It appears the Court of Civil Appeals' concern was the wording of D.B.R's filing, which stated that it was made "on behalf of the minor child." The Court of Civil Appeals interpreted this document as a motion by D.B.R., as the child's father, for a rehearing or to alter, amend, or vacate the order. However, as Judge Crawley stated in his dissent, "the language used by a pro se litigant cannot be viewed in a technical sense." 757 So. 2d at 1192. That language mentioning the child could be understood as indicating that the child was the object of the father's concern. We cannot and should not expect a pro se litigant to use the same technical precision that we expect from a lawyer.
A party questioning the sufficiency of the evidence in a nonjury fact determination may appeal the ruling directly, because in such a case the filing of a post-trial motion is not a predicate for appellate review. Rule 52(b), Ala. R. Civ. P. In order for D.B.R. to appeal, it was not necessary for him to first file a post-judgment motion. Therefore, the trial court could have treated the March 18, 1997, filing as an appeal rather than as a postjudgment motion. A court is to construe pleadings so as to do substantial justice. Rule 8(f), Ala. R. Civ. P.
The trial court considered the March 18, 1997, filing, styled "Appeal of Decisions of March 3, 1997," as a petition for a rehearing. The document does not mention the word "rehearing," nor is there any indication that D.B.R. intended for this document to be a request for a rehearing. However, there is evidence that he intended to appeal the court's previous determination. Throughout the document filed March 18, 1997, D.B.R. uses language consistent with an appeal. Because Rule 52(b), Ala. R. Civ. P., permits D.B.R. to directly appeal the court's ruling, and because of the principle of Rule 8 that all pleadings are to be construed so as to do substantial justice, we conclude that the March 18, 1997, filing was more properly to be considered as a notice of appeal, not as a petition for a "rehearing" or as a motion to alter, amend, or vacate the judgment. Because we construe D.B.R's filing as a notice of appeal, we must consider whether the ruling of March 10, 1997, is, in fact, a final judgment and therefore appealable.
In Potter v. State Dep't of Human Resources, 511 So. 2d 190 (Ala.Civ.App. 1986), the Court of Civil Appeals held that a decision of a juvenile court finding that children were dependent and awarding temporary custody to the children's maternal grandparents and the state, constituted a "final judgment, order, or decree" for the purpose of the rule giving parents 14 days from the entry of a "final judgment, order or decree" in which to file a notice of appeal. 511 So. 2d at 192. We conclude that the trial court's order of March 10, 1997, was an appealable order and that D.B.R.'s filing of March 18, 1997, was a timely notice of appeal from that order.
As for D.B.R.'s petition to be treated as an indigent, we question why the trial court appointed an attorney for D.B.R. for the purpose of his appeal but not for the purpose of the original trial. Section 12-15-63(b), Ala.Code 1975, states:
It is not the responsibility of this Court to determine whether D.B.R. is in fact indigent and therefore entitled to appointed counsel. However, the record before us indicates that the trial court should review D.B.R.'s status again to determine whether he is entitled to appointed counsel.
We reverse the judgment of the Court of Civil Appeals and remand for that court to direct the trial court to determine if *1196 D.B.R. was indigent at the time of trial, and, if so, to grant him a new trial. If the trial court determines D.B.R. was not then indigent, then the Court of Civil Appeals is to consider the merits of his appeal.
REVERSED AND REMANDED WITH INSTRUCTIONS.
SHORES, HOUSTON, KENNEDY, and COOK, JJ., concur.
LYONS, J., concurs in the result.
MADDOX, J., dissents. | 61622a2cf45b5533050b2c4e2368973434948c14667e21c001f73e3f4b068c49 | 1998-12-18 00:00:00 |
100c9448-6fb6-4f98-b5e4-304af6a525f8 | Emperor Clock Co., Inc. v. AT&T CORP. | 727 So. 2d 41 | 1970566 | Alabama | Alabama Supreme Court | 727 So. 2d 41 (1998)
EMPEROR CLOCK COMPANY, INC.
v.
AT&T CORPORATION.
1970566.
Supreme Court of Alabama.
December 11, 1998.
Robert T. Cunningham, Jr., J. Stephen Legg, and David G. Wirtes, Jr., of Cunningham, Bounds, Yance, Crowder & Brown, L.L.C., Mobile, for appellant.
Robin G. Laurie of Balch & Bingham, L.L.P., Montgomery; Allan R. Chason of Chason & Chason, P.C., Bay Minette; and Laura A. Kaster, of AT&T Corporation, Liberty Corner, NJ, for appellee.
PER CURIAM.
AT&T Corporation filed an action alleging that Emperor Clock Company, Inc., had breached its contract to purchase at least a stated minimum amount of long-distance telephone service from AT&T over 36 months. Emperor filed a counterclaim alleging breach of contract and fraud in the inducement of the contract. The circuit court entered a summary judgment for AT&T on the counterclaim, holding that the claims asserted therein were barred under the "filedrate" doctrine and were preempted by the jurisdiction of the Federal Communications Commission (FCC) and the Alabama Public Service Commission (APSC). The court made the summary judgment final, pursuant to Rule 54(b), Ala. R. Civ. P., and Emperor appealed.
The evidence, viewed in a light most favorable to Emperor, indicates that in April 1994 AT&T represented orally and in writing that if Emperor switched its long-distance service to AT&T, then Emperor would reap substantial savings on its long-distance bill. Based on these representations, Emperor agreed to use at least $72,000 in long-distance service over the life of the contract, 36 months. When Emperor discovered that it was actually paying more for long-distance service than it had paid with its previous provider, Emperor terminated the contract. Emperor paid $24,511.03 for the long-distance service it had used. AT&T brought this action against Emperor for the balance remaining under the contract, which it alleged to be $47,488.97. Emperor filed a counterclaim alleging, in the alternative, that AT&T either had breached the contract or had procured the contract by fraud.
The "filed-rate" or "filed-tariff" doctrine arose many years ago. See Kansas City Southern R. v. Carl, 227 U.S. 639, 33 S. Ct. 391, 57 L. Ed. 683 (1913). The doctrine was established to prevent regulated, monopolistic interstate transportation and communications companies from discriminating *42 among their respective customers with respect to rates for particular services. These regulated industries are required by law to file a tariff with the appropriate regulatory body, such as the FCC and the APSC, that sets forth in detail the rates to be charged and the services to be provided under various sets of circumstances. Once a company files a tariff, the company is forbidden from deviating from the rates contained therein. Under the filed-rate doctrine, a consumer of the regulated service is conclusively presumed to have notice of the contents of the tariff and may not claim that it is entitled to any rate other than the rate contained in the tariff.
In Mobley v. AT&T Corp., 717 So. 2d 367 (Ala.1998), this Court affirmed a judgment on the pleadings for the defendant. The plaintiffs had alleged "that AT&T Corporation fraudulently misrepresented its billing practices and suppressed the fact that it rounds up to the next minute its charges for long distance telephone calls." 717 So. 2d at 367-68. The judgment for AT&T was based on the filed-rate doctrine. This Court affirmed, noting that "the conclusive presumption that the plaintiffs knew of the filed rate bars these claims." 717 So. 2d at 368.
During the pendency of this present appeal, the United States Supreme Court reaffirmed the filed-rate doctrine in a case quite similar to this one, holding that the antidiscrimination policy behind the doctrine is so important that a consumer of regulated services cannot assert a state-law claim based on alleged promises that differed from the published tariff. See American Tel. & Tel. Co. v. Central Office Tel., Inc., 524 U.S. 214, 118 S. Ct. 1956, 141 L. Ed. 2d 222 (1998). In Central Office, the Supreme Court stated that "even if a carrier intentionally misrepresents its rate and a customer relies on the misrepresentation, the carrier cannot be held to the promised rate it if conflicts with the published tariff." 524 U.S. at ___, 118 S. Ct. at 1963.
Emperor does not claim that the rate actually charged by AT&T exceeded the applicable rate stated in AT&T's filed tariff. Emperor argues that AT&T falsely represented that Emperor would save money if it switched to AT&T. Such a claim is barred by the conclusive presumption that a customer knows the filed rate. Central Office, supra; Mobley, supra.
Emperor argues that recent changes in the law have effectively repealed the filed-rate doctrine. Without discussing those changes, we simply note that they occurred after the events on which Emperor bases its claims had occurred.
Emperor's claims are barred by the filed-rate doctrine.
AFFIRMED.
HOOPER, C.J., and MADDOX, ALMON, SHORES, HOUSTON, COOK, SEE, and LYONS, JJ., concur. | 2600f383cc476449a04f22cc2ec78b345feb5906e96377392357702eafb5748b | 1998-12-11 00:00:00 |
1f5fb5ae-4daa-4c6c-8b2f-f7b0f65d47da | Brooks v. FIRST FEDERAL SAV. & LOAN ASS'N | 726 So. 2d 640 | 1961570 | Alabama | Alabama Supreme Court | 726 So. 2d 640 (1998)
Alder Pearl BROOKS, By and Through Mildred VICKERS and Helen Jean Rhodes, her next friends; and Mildred Vickers and Helen Jean Rhodes, individually
v.
FIRST FEDERAL SAVINGS AND LOAN ASSOCIATION OF SYLACAUGA.
1961570.
Supreme Court of Alabama.
December 18, 1998.
*641 Thomas Reuben Bell, Sylacauga; James S. Hubbard, Anniston; and William Henry Agee, Anniston, for appellants.
Michael A. LeBrun of Potts & Young, L.L.P., Florence; and Steven D. Adcock, Talladega, for appellee.
LYONS, Justice.
Alder Pearl Brooks, Mildred Vickers, and Helen Jean Rhodes (together, "the Brookses") are plaintiffs in an action pending in the Talladega Circuit Court against First Federal Savings and Loan Association of Sylacauga ("First Federal"). We granted the Brookses permission, pursuant to Rule 5, Ala. R.App. P., to appeal from the trial court's order denying their motion in limine. We reverse and remand.
The Brookses' action was tried once before, and a jury found for the defendant, First Federal. The trial court entered a judgment in favor of First Federal on that verdict. However, the Court of Civil Appeals reversed that judgment in Brooks v. First Fed. Sav. & Loan Ass'n of Sylacauga, 679 So. 2d 1148 (Ala.Civ.App.1996) ("Brooks I"), and remanded the cause for a new trial. In Brooks I, the Court of Civil Appeals set out the following pertinent facts:
679 So. 2d at 1149.
During the first trial, First Federal called several witnesses who gave parol evidence regarding the intent of the parties who entered into the alleged trust agreement. Brooks I, 679 So. 2d at 1149-50. Apparently, First Federal used these witnesses to try to prove that Pearl Brooks and Louie Brooks did not enter into a trust agreement, but merely opened a joint account, from which Louie Brooks could withdraw the funds at any time. The Court of Civil Appeals held the admission of this parol evidence to be reversible error because, that court held, the instrument completely and unambiguously created a trust. Id. The Court of Civil Appeals reversed the judgment. First Federal petitioned for certiorari review; however, this Court denied its petition. Id. at 1148.
On remand, the Brookses filed two motions in limine. In their first motion, they asked the court to exclude expert testimony that First Federal sought to introduce at the new trial. Their motion in limine addressed the following issues: (1) whether the expert could testify that the instrument was patently ambiguous as to the terms that would govern the administration of the trust; (2) whether the expert could testify that Alder Pearl Brooks and Louie Brooks were co grantors or co-settlors of the trust; (3) whether the expert could testify that the terms of the trust specifically allowed either grantor, Mr. or Mrs. Brooks, to withdraw money from the trust; (4) whether the expert could testify that the word "or" in the phrase "Mr. Louie H. Brooks or Mrs. Alder Pearl Brooks, Trustees," which phrase appears on the line provided for the trustee's name, means that either Mr. Brooks or Mrs. Brooks could withdraw the trust funds without the consent of the other; and (5) whether the expert could testify that when First Federal allowed Mr. Brooks to withdraw funds from the trust, First Federal did not act in bad faithbad faith being a requirement the Brookses must prove to hold the bank liable under §§ 19-1-9 and -10, Ala.Code 1975.
In their second motion, the Brookses asked the trial court to rule that the following are questions of law: (1) whether one grantor can withdraw funds from the subject trust without the consent of the other; (2) whether one trustee can withdraw funds from the subject trust without the consent of the other trustee; and (3) whether §§ 19-1-9 and -10, Ala.Code 1975, apply to this case. In that motion, the Brookses also argued that because these issues are questions of law, First Federal's proposed expert testimony is not appropriate.
The trial court issued an order on both motions that provides, in pertinent part:
The Brookses requested permission to appeal from this interlocutory order, pursuant to Rule 5, Ala. R.App. P. The trial judge stated that his interlocutory order involved "a controlling question of law as to which there is substantial ground for differences of opinion *643 and that an immediate appeal from this order would materially advance the ultimate determination of the litigation and the appeal would avoid protracted and expensive litigation." See Rule 5(a). We granted the Brookses permission to appeal.
We begin with the trial court's holding in parts one and two of its order: that the jury must resolve questions of fact in determining whether Mr. Brooks, as grantor, could withdraw funds from the trust account without the consent of the other grantor, Mrs. Brooks; and whether Mr. Brooks, as trustee, could withdraw funds from the trust account without the consent of the other trustee, Mrs. Brooks. The Brookses argue that both of these questions are questions of law for the trial court because the Court of Civil Appeals has already held, in Brooks I, that the trust instrument is complete and unambiguous. We agree.
The rule of law governing the construction of contracts is that "[i]f the terms within a contract are plain and unambiguous, the construction of the contract and its legal effect become questions of law for the court...." McDonald v. U.S. Die Casting & Dev. Co., 585 So. 2d 853, 855 (Ala.1991). In Brooks I, the Court of Civil Appeals held that the terms of the trust instrument are complete and unambiguous, and this Court denied review. 679 So. 2d at 1148, 1150. Therefore, under the doctrine of the law of the case, the meaning of the trust instrument and whether Mr. Brooks alone could withdraw funds from the trust account are questions of law for the trial court; thus, the trial court erred in holding that these are questions of fact. See Gray v. Reynolds, 553 So. 2d 79, 81 (Ala.1989) ("It is well established that on remand the issues decided by an appellate court become the `law of the case,' and that the trial court must comply with the appellate court's mandate.").
Because no fact issue exists as to parts one and two of the trial court's order and the issues are questions of law for the trial court, expert testimony is not appropriate. Therefore, we find it unnecessary to reach part four of the trial court's order, dealing with the admissibility of expert testimony to resolve perceived questions of fact stated in parts one and two.
We now turn to part three of the trial court's order, dealing with the law governing First Federal's alleged wrongdoing in connection with Mr. Brooks's transfers from the trust account.[1] The Brookses argue that §§ 19-1-9 and -10, Ala.Code 1975, do not apply to their complaint. Sections 19-1-9 and -10 are part of the Uniform Fiduciaries Act ("the U.F.A."), which our legislature adopted in 1943. The U.F.A. deals with cases, like the present case, in which "a beneficiary tries to impose liability upon a bank for a fiduciary's malfeasance" and it "generally imposes upon the beneficiary the risk of fiduciary misappropriation of checks or funds belonging to the beneficiary" unless the bank had actual knowledge of the fiduciary's wrongdoing or had knowledge of such facts that its action amounts to bad faith. Marion W. Benfield, Jr. & Peter A. Alces, Bank Liability for Fiduciary Fraud, 42 Ala. L.Rev. 475, 488, 492 (1991). The U.F.A. insulates banks that deal with wrongdoing fiduciaries from liability unless the beneficiary can show that the bank had actual knowledge of the wrongdoing or had knowledge of such facts that prove bad faith on the part of the bank. §§ 19-1-1 to -13.
First, the Brookses maintain that the Uniform Commercial Code ("the U.C.C."), as codified in Title 7, Ala.Code 1975, imposes obligations upon First Federal beyond the actual-knowledge and bad-faith standards imposed under the U.F.A. Specifically, the Brookses contend that § 7-4-401, Ala.Code 1975, applies in this case. However, that section deals with the question of when an "item" is properly payable from a customer's account. "`Item' means an instrument or a promise or order to pay money handled by a bank for collection or payment. The term *644 does not include a payment order governed by Article 4A or a credit or debit card slip." § 7-4-104(9), Ala.Code 1975. "Article 4A governs a specialized method of payment referred to in the Article as a funds transfer but also commonly referred to in the commercial community as a wholesale wire transfer." § 7-4A-102, Ala.Code 1975, official comment.
Mr. Brooks made three transfers from the trust account. The first transfer was a written "Intra-Bank Transfer," in which Mr. Brooks ordered First Federal to transfer $31,121.50 from the trust account to the savings account he shared with his son. First Federal completed this transfer electronically. Thus, Article 4A governs the first transaction, and § 7-4-401 is inapplicable.
In the second and third transfers, Mr. Brooks used nonnegotiable cash withdrawal slips to withdraw trust-account funds in the amounts of $5,000 and $15,838.17, respectively. He then deposited this cash into the savings account he shared with his son. Because these withdrawals, unlike the first transfer, are not transfers under Article 4A, § 7-4-401 could apply if these withdrawals were done either by an "instrument or a promise or order to pay money handled by a bank for collection or payment." § 7-4-104(9).
The word "instrument," as defined in the U.C.C. as adopted by our legislature, "means a negotiable instrument." § 7-3-104(b).
§ 7-3-104(a). The purported instrument must also be in writing. See §§ 7-3-103(a)(9) and (a)(6), Ala.Code 1975 (stating that a "promise" and an "order" must be "a written undertaking" or "a written instruction," respectively).
Also, the U.C.C. defines an "order" as follows:
§ 7-3-103(6). "`Promise' means a written undertaking to pay money signed by the person undertaking to pay. An acknowledgment of an obligation by the obligor is not a promise unless the obligor also undertakes to pay the obligation." § 7-3-103(9).
These withdrawal slips are not "instruments," because they state that they are nonnegotiable. Section 7-4-401 also applies to a promise or order to pay money. However, neither of the withdrawal slips that effectuated these two transfers is a "promise" because neither contains "a written undertaking." Also, neither slip is an "order" because neither is "a written instruction" to pay money. Thus, § 7-4-401 does not apply to any of these transfers from the trust account.
Furthermore, § 7-3-307, entitled "Notice of breach of fiduciary duty," does not apply. The legislature added this section of the U.C.C. in 1995 when it revised Article 3 by repealing all the sections thereof and replacing them with new sections. Former §§ 7-3-304(2) and 7-3-304(4)(e) related to this issue but were unclear. Section 7-3-307 "states rules for determining when a person who has taken an instrument from a *645 fiduciary has notice of a breach of fiduciary duty that occurs as a result of the transaction with the fiduciary." § 7-3-307, Ala.Code 1975, official comment. Therefore, § 7-3-307 applies only when a person takes an instrument. As stated above, none of these transfers involved an instrument. Accordingly, § 7-3-307 does not apply.
We must also address the Brookses' argument that §§ 19-1-9 and -10 do not apply to their claims. First, we hold that § 19-1-10 is not applicable to the Brookses' claims, because it deals with deposits made by check, and it is undisputed that none of the deposits in this case were made by check. Second, we hold that § 19-1-9 is not applicable to the Brookses' claims. Section 19-1-9 addresses a bank's liability for the act of accepting a deposit into a fiduciary's personal account when the fiduciary is not entitled to make such a deposit and for the act of allowing a fiduciary to misuse trust funds deposited in the fiduciary's personal account. See Heffner v. Cahaba Bank & Trust Co., 523 So. 2d 113 (Ala.1988). The Brookses complain that First Federal improperly allowed Mr. Brooks to withdraw funds from the trust account. They do not allege that First Federal is liable either for allowing Mr. Brooks to deposit trust funds into his personal account or for allowing him to misuse the trust funds deposited into his personal account. Thus, First Federal's allegedly wrongful acts are not within the purview of § 19-1-9.[2]
The trial court erred when it held that the meaning of the trust instrument is a question of fact for the jury and that First Federal's expert could testify as to the meaning of that instrument. Also, the trial court erred in holding that §§ 19-1-9 and -10, Ala.Code 1975, apply to the Brookses' claims. Accordingly, the trial court's order denying the Brookses' motion in limine is reversed and the cause is remanded for further proceedings consistent with this opinion.
REVERSED AND REMANDED.
SHORES, KENNEDY, and COOK, JJ., concur.
ALMON, J., concurs in the result.
HOOPER, C.J., and SEE, J., concur in part and dissent in part.
SEE, Justice (concurring in part and dissenting in part).
I concur with those portions of the main opinion that hold that the meaning of the trust instrument is a question of law; that whether Mr. Brooks alone could withdraw funds from the trust account is a question of law; that the testimony of First Federal's expert as to the meaning of the trust instrument was inadmissible; and that Ala.Code 1975, § 19-1-10, does not apply to shield First Federal from the Brookses' claims. I respectfully dissent, however, from that portion of the main opinion that holds that First Federal's allegedly wrongful acts are not within the purview of Ala.Code 1975, § 19-1-9.
(Emphasis added.) Thus, there are two requirements for a bank to have immunity under § 19-1-9: (1) that the fiduciary, or agent, deposit money held as a fiduciary, or as an agent, into his personal account; and (2) that such deposits be made by "check" or "otherwise." The main opinion does not dispute that the second requirement of § 19-1-9that such deposits be made by "check" or "otherwise"expressly covers Mr. Brooks's noncheck deposits of trust account funds into his personal account. However, the main opinion concludes that the first requirement of § 19-1-9that the fiduciary or agent deposit trust money into his personal account is not implicated in this case because the Brookses "do not allege that First Federal is liable either for allowing Mr. Brooks to deposit trust funds into his personal account or for allowing him to misuse the trust funds deposited into his personal account." 726 So. 2d at 645. I disagree.
In general, § 19-1-3 protects a bank that innocently allows a trustee to withdraw money from a trust account,[3] and § 19-1-9 protects a bank that innocently accepts deposits of trust funds into a trustee's personal account. Thus, when two different banks are involved, the Uniform Fiduciaries Act would protect each bank as follows: Section 19-1-3 would apply exclusively to "Bank A" that holds the trust account from which the moneys are withdrawn, and § 19-1-9 would apply exclusively to "Bank B" that holds the trustee's personal account into which the trust funds are deposited.[4] I cannot conclude that the Uniform Fiduciaries Act would provide less protection where the withdrawal and deposit are made at a single bank. Further, I cannot conclude that the transfers from the trust account to Mr. Brooks's personal account at the same bank can be artificially separated by the plaintiff into withdrawal and deposit components in order to exclude the application of either § 19-1-3 (relating to withdrawals) or § 19-1-9 (relating to deposits). Instead, where the same bank holds both the trust account and the trustee's personal account, as in this case, §§ 19-1-3 and 19-1-9 should be read together.
The overlapping operation of §§ 19-1-3 and 19-1-9 is clearly illustrated in Rheinberger v. First National Bank of St. Paul, 276 Minn. 194, 150 N.W.2d 37 (1967), in which a trustee wrongfully withdrew funds from a trust account in a bank and deposited those funds into his personal account at that same bank through an intrabank transfer. The Supreme Court of Minnesota held that the bank was not liable to the beneficiary under Minn. St. § 520.09, which is the equivalent of Alabama's § 19-1-9. 276 Minn. at 198, 150 N.W.2d at 40 ("In our opinion the transfer of funds by debiting the old account and crediting the new account falls within the scope of [§ 520.09]."). The court noted that the bank was also shielded from liability by Minnesota's equivalent of § 19-1-3. Id. at 201, 150 N.W.2d at 42 ("Nor was [the bank] under any duty after the transfer was completed to insure that the [trustee] did not misuse these funds. Minn. St. 520.02.").
Although only § 19-1-9 has been directly raised in this appeal, I would interpret § 19-1-9 as being in pari materia with § 19-1-3 in this intrabank-transfer case. The application of § 19-1-9 to intrabank transfers appears particularly appropriate when the basis of the plaintiff's claim is conversion of trust *647 property. When a single transfer both takes money from the trust account and places it in the trustee's personal account, it effects a conversion that is complete only upon the deposit into the personal account. Thus, § 19-1-9 is directly implicated even where the plaintiff casts his complaint so as to artificially separate the withdrawal component of the intrabank transfer from the deposit component of that same transfer. In short, exclusive application of § 19-1-3 to intrabank transfers ignores the reality of the conversion transaction, the text of § 19-1-9, and the purpose of the Uniform Fiduciaries Act.
HOOPER, C.J., concurs.
[1] Of course, if the trial court rules as a matter of law that Mr. Brooks was legally entitled to make the transfers, then it would be unnecessary to deal with the issue of wrongdoing on the part of First Federal.
[2] Of course, this conclusion does not mean that all sections of the Uniform Fiduciaries Act do not apply. For example, § 19-1-3, Ala.Code 1975, may apply to the present case; however, the application of that statute is not properly before us.
[3] Section 19-1-3 states:
"A person who in good faith pays or transfers to a fiduciary any money or other property which the fiduciary as such is authorized to receive, is not responsible for the proper application thereof by the fiduciary; and any right or title acquired from the fiduciary in consideration of such payment or transfer is not invalid in consequence of a misapplication by the fiduciary."
[4] For example, in Heffner v. Cahaba Bank & Trust Co., 523 So. 2d 113 (Ala.1988), an executrix deposited estate funds into her personal account at a bank. The funds came from a draft payable by a life insurance company, not from an estate account at the same bank into which the deposit was made. Thus, this Court properly analyzed the potential liability of the bank for withdrawals from that account under Ala.Code 1975, § 19-1-9. Unlike the deposits in Heffner, however, the moneys deposited in Mr. Brooks's personal account came from a fiduciary account held at the same bank. | b44b9e69bac33bc1dcf0182b3790a70aa0b5fc602b48908da67686adb543f590 | 1998-12-18 00:00:00 |
01d84fcb-44f8-44c5-87c8-62015db11f6b | Wal-Mart Stores, Inc. v. Thompson | 726 So. 2d 651 | 1970568 | Alabama | Alabama Supreme Court | 726 So. 2d 651 (1998)
WAL-MART STORES, INC.
v.
Elizabeth THOMPSON.
1970568.
Supreme Court of Alabama.
December 18, 1998.
Bradley R. Byrne, K.W. Michael Chambers, and R. Scott Hetrick of McRight, Jackson, Myrick & Moore, L.L.C., Mobile, for appellant.
*652 William L. Utsey of Utsey, Christopher, Newton & Utsey, Butler; and Wyman O. Gilmore, Jr., Grove Hill, for appellee.
HOOPER, Chief Justice.
This is a premises liability case. The plaintiff, Elizabeth Thompson, filed an action in Clarke County, on August 15, 1994, against Wal-Mart Stores, Inc., and Sheldon Day, the manager of Wal-Mart's store in Thomasville. The complaint alleged two causes of action: (1) negligence and (2) wantonness. The defendants answered, denying Mrs. Thompson's allegations. Mrs. Thompson later amended her complaint to add another negligence claim, and the defendants filed an amended answer. On April 3, 1997, the defendants moved for a motion for summary judgment on Mrs. Thompson's wantonness claim. On April 29, 1997, Mrs. Thompson moved for an extension of time to respond to the summary judgment motion. The trial court denied the motion for summary judgment.
The case was tried to a jury on August 11, 1997. On the question of liability, Mrs. Thompson presented four witnesses: herself, John Leyenberger (by deposition), Sheldon Day (by deposition), and Allene Dannelly. On the question of damages, she presented five witnesses: Neff Weber, Dr. Roy Larrimore (by deposition), Dr. William Bridges (by deposition), Dr. Robert Allen (by deposition), and her husband. Mrs. Thompson dismissed Sheldon Day as a defendant, with prejudice. The remaining defendant, Wal-Mart, filed motions for a judgment as a matter of law on the wantonness claim and on the issues of mental-anguish damage and punitive damages. The trial court denied the motions as to the wantonness claim and the punitive-damages issue and reserved ruling on the mental-anguish issue. Wal-Mart presented three witnesses: John Leyenberger, Frances Agee, and Sheldon Day. Then it renewed its specific motions for a judgment as a matter of law, which the trial court denied. Wal-Mart admitted liability on the negligence claims. The jury returned a plaintiff's verdict, awarding $100,000 in compensatory damages on the negligence claims and $175,000 in punitive damages on the wantonness claim. Wal-Mart renewed its motions for a judgment as a matter of law and moved for a new trial. Without a hearing or entering a detailed order, the trial court denied the motions. The trial court entered a judgment on the verdict. Wal-Mart appealed on December 19, 1997.
We reverse the trial court's order denying Wal-Mart's motion for a judgment as a matter of law on the wantonness claim and on that claim we render a judgment for Wal-Mart. We affirm that portion of the judgment awarding $100,000 on the negligence claims.
On the morning of June 26, 1993, Mrs. Thompson and her friend Allene Dannelly went shopping for curtains at the Wal-Mart store in Thomasville. As she was bending over to look at the curtains, a small cubical footlocker, approximately 1 1/2- to 2-feet square fell from the "riser," the top shelf, where excess merchandise was kept.
A Wal-Mart employee, Francis Agee, was in the opposite aisle assisting another customer at the time of the accident. Ms. Agee had taken a piece of luggage down from the riser and had replaced it after the customer finished looking at it. Mrs. Thompson admitted that she does not know what caused the footlocker to fall. Neither could an eyewitness determine what caused the locker to fall from the riser.
Mrs. Thompson was taken to the hospital after the incident. She was X-rayed and was told there was nothing wrong. She received stitches to heal the cut and two regular over-the-counter medicine tablets for pain. Mrs. Thompson testified that she had a good night's sleep on the night of the accident. The following Monday she saw a general practitioner, Dr. Roy Larrimore. At the time, she was complaining of headaches. He examined her again on two separate occasions. After each examination, he decided it was not necessary to give her any more medication, nor to give her any treatment. She later decided to see a neurosurgeon, still complaining of headaches. The neurosurgeon, Dr. William Bridges, performed a CAT scan, which showed nothing unusual. From September 1993 until April 1994, Mrs. *653 Thompson did not see any doctor about the injury or any effect of the injury she claimed to have sustained at the Wal-Mart store. In April 1994, after having seen several doctors, who ran a variety of tests, with each doctor summarily concluding that she had recovered, Mrs. Thompson chose to see a neurologist, Dr. Robert Allen. On April 6, 1994, Dr. Allen gave a diagnosis of some nerve damage, for which he said he could treat her in at least eight visits. Mrs. Thompson visited Dr. Allen 15 times, and she claimed to feel relief from these treatments. The treatment involved injections of an anesthetic agent and a numbing medicine plus a steroid medicine of the cortisone type. She testified that she was never treated for depression, never had any anxiety or nervousness, and never suffered mental anguish as a result of this incident. Mrs. Thompson also testified that she had had headaches before the accident at the Wal-Mart store.
Before this accident, Wal-Mart had written safety policies concerning the placement of merchandise, including the placement of merchandise on risers. These policies were developed at the corporate level. The management of each individual store then instructed the store employees as to the safety policies. Wal-Mart's corporate headquarters issued at least 75 percent of the overall merchandise-placement policies. The individual stores have the authority to determine the layout of what Wal-Mart calls "flex" and "seasonal" merchandise. The footlocker in question was a back-to-school seasonal item. Additionally, Wal-Mart used fencing, three inch high pieces of rectangular metal, on certain shelves, to hold in certain loose merchandise, such as "Nerf" toys. The corporate policy prohibited the use of fencing on risers because it was ineffective for flat stable items stored on risers. Further, each store has a risk-control team. On a corporate level, Wal-Mart employs a team of 21 full-time safety employees who regularly travel to Wal-Mart stores for inspections to ensure that the Wal-Mart safety policies are being implemented.
Furthermore, Wal-Mart trained its employees to make sure the stacked products were stable and straight. The products were not to be within 18 inches of any sprinkler heads. In order to ensure stability, Wal-Mart also required that heavier items be in lower-shelf areas and it implemented a "bump test."
The Thomasville store maintained incident reports and did not provide these reports to corporate headquarters. According to the testimony of Sheldon Day, the manager of the Thomasville store at the time of the incident, Wal-Mart was aware of accidents that had been caused by falling merchandise. However, he added: "[T]hat's why we took action through training of our associates on the stable stacking of merchandise on risers." Wal-Mart's corporate risk-prevention department was not aware in 1992 and 1993 of any significant safety problems at the Thomasville store. Nonetheless, in Wal-Mart's answers to the plaintiff's interrogatories, it stated that 167 accidents involving falling merchandise had occurred in Wal-Mart stores in Alabama during the five years preceding Mrs. Thompson's accident. This figure represents accidents in Wal-Mart stores across the entire state; this Court has held that on questions of premises liability accidents at other locations are irrelevant. Burlington Northern R.R. v. Whitt, 575 So. 2d 1011, 1019 (Ala.1990).
The record clearly reflected that Wal-Mart had been aware of accidents involving falling merchandise, but that, because of this awareness, it had instituted many thorough safety procedures in order to ensure the safety of its customers. The evidence indicates that Wal-Mart implemented sufficient guidelines. The plaintiff asserts that these guidelines indicate awareness on Wal-Mart's part. However, using vigorous safety policies, like these Wal-Mart had in place, to support a claim of wantonness is equivalent to punishing someone for taking precautions to avoid causing injury. The standard required to support a wantonness claim is a high one and should remain such.
Wal-Mart raises three issues on appeal: (1) Whether the trial court erred in denying Wal-Mart's motions for summary judgment and its motion for a judgment as a matter of law on Mrs. Thompson's wantonness claim; *654 (2) whether the trial court erred in denying Wal-Mart's motion for a judgment as a matter of law on Mrs. Thompson's claim for mental-anguish damages, a motion based on a claim that she failed to present substantial evidence in support of that claim; and (3) whether the trial court erred in precluding Wal-Mart from presenting, as rebuttal evidence, an estimate of the total number of customers entering Wal-Mart's stores in Alabama in the three years before to Mrs. Thompson's injury.
Wal-Mart argues that the trial court erred in denying its motions for a summary judgment and later for a judgment as a matter of law on the wantonness claim. Mrs. Thompson asserts that Wal-Mart wantonly caused the footlocker to fall on her and wantonly failed to prevent it from falling on her.
This court has declined to adopt an ironclad rule that an erroneous denial of a motion for summary judgment is always rendered moot by a subsequent verdict in favor of the nonmovant, lest we encourage a party to change "testimony or other evidence based on experience gained during the proceedings on the motion for summary judgment." Superskate v. Nolen, 641 So. 2d 231, 233-34 (Ala.1994). Because we are not here confronted with a situation involving a change of testimony, we will not consider whether the defendant was in fact entitled to a summary judgment, but will consider whether at trial it was entitled to a judgment as a matter of law.
In reviewing the denial of a motion for a judgment as a matter of law, we apply this standard: "A judgment as a matter of law is proper only where there is a complete absence of proof on a material issue or where there are no controverted questions of fact on which reasonable people could differ." Locklear Dodge City, Inc. v. Kimbrell, 703 So. 2d 303 (Ala.1997). Further, this Court, as the reviewing court, must view all evidence in the light most favorable to the nonmoving party. Bussey v. John Deere Co., 531 So. 2d 860 (Ala.1988).
On her wantonness claim, Mrs. Thompson had to present evidence indicating that Wal-Mart knew that a practice it was engaging in would likely or probably result in the injury allegedly suffered by Mrs. Thompson. "Wantonness" is statutorily defined as "conduct which is carried on with a reckless or conscious disregard of the rights or safety of others." Ala.Code 1975, § 6-11-20(b)(3). This Court has accepted the following definition of wantonness: "the conscious doing of some act or the omission of some duty, while knowing of the existing conditions and being conscious that, from doing or omitting to do an act, injury will likely or probably result." Bozeman v. Central Bank of the South, 646 So. 2d 601 (Ala.1994). Accordingly, to prove "wantonness," one need not prove intentional conduct; however, proof of wantonness still requires evidence of a reckless or conscious disregard of the rights and safety of others. This Court recognizes a distinction between negligence and wantonness.
Mrs. Thompson did not present sufficient evidence to support a finding of wantonness. Although Wal-Mart's Thomasville store had received two or three reports of falling merchandise before this accident, the management of that store had no information from which they could have known that an accident of the kind which occurred in this case was likely to happen. The evidence was not sufficient to support a finding that Wal-Mart was reckless in storing footlockers on the risers. Wal-Mart had both corporate and local safety teams, safety manuals, and safety reinforcement mechanisms. Although Wal-Mart's action in storing this merchandise could be considered negligent, its behavior was not such as to warrant a verdict of wantonness.
Wal-Mart argues that Mrs. Thompson failed to present any evidence showing that Wal-Mart committed willful or wanton conduct and the trial court therefore should have granted its motion for a judgment as a matter of law as to the wantonness claim. There was no evidence to indicate that any Wal-Mart employee "wantonly" caused the footlocker to fall. Further, there was no evidence to indicate that Wal-Mart "wantonly" failed to prevent Mrs. Thompson's injury. There was evidence indicating that Wal-Mart had enforced a plethora of safety measures in *655 order to protect employees and customers. Construing the evidence in the light most favorable to Mrs. Thompson, we cannot classify Wal-Mart's behavior as wanton. Wal-Mart asks us to reverse the trial court's denial of its motion for a judgment as a matter of law on the wantonness claim. Wal-Mart admits it was negligent. This Court must continue to uphold the distinction between negligence and wantonness. Therefore, because the trial court should have granted Wal-Mart's motion for a judgment as a matter of law as to the wantonness claim, we reverse that portion of the judgment awarding punitive damages on the jury's finding of wantonness; and as to the wantonness claim, we render a judgment for the defendant Wal-Mart.
Wal-Mart asks this court to reverse the judgment on the negligence claim insofar as it awarded damages based on the plaintiff's claims of mental anguish/emotional distress. Wal-Mart claims it was entitled to a judgment as a matter of law on any claims for damages based on mental anguish/emotional distress.
This Court has accepted this definition of "mental anguish" from Black's Law Dictionary (6th ed. 1990):
Volkswagen of America, Inc. v. Dillard, 579 So. 2d 1301, 1306 (Ala.1991).
Mrs. Thompson presented substantial evidence indicating she had suffered mental anguish as a result of the accident. As the Black's Law Dictionary definition states, mental anguish is more than mere worry or embarrassment. It is more than lost sleep. The evidence showed that Mrs. Thompson suffered a serious and painful physical injury when she was hit in the head by a footlocker that fell several feet off a tall shelf, and the evidence indicated this injury was caused by negligent conduct of the defendant. This injury required her to see various doctors on several occasions, who treated her for physical symptoms, such as head and neck pain. Viewing the evidence in the light most favorable to the plaintiff, as we are required to do, we conclude that it was sufficient for the jury to award damages to compensate the plaintiff for the mental or emotional pain and suffering that attended her injury. The trial court did not err in denying Wal-Mart's motion for a judgment a matter of law as to the claim for mental anguish damages.
Wal-Mart argues that the trial court abused its discretion by excluding Wal-Mart's evidence of the number of customers who had entered Alabama Wal-Mart stores, including the Thomasville store, and the number of transactions that had occurred at those stores. The standard applicable to a review of a trial court's rulings on the admission of evidence is determined by two fundamental principles. The first grants trial judges wide discretion to exclude or to admit evidence. "The test is that the evidence must ... shed light on the main inquiry, and not withdraw attention from the main inquiry." Atkins v. Lee, 603 So. 2d 937 (Ala.1992) (citing Ryan v. Acuff, 435 So. 2d 1244 (Ala.1983)). The second principle "is that a judgment cannot be reversed on appeal for an error unless ... it should appear that the error complained of has probably injuriously affected substantial rights of the parties." Atkins, 603 So. 2d at 941. Based on these principles, we conclude that the trial judge's evidentiary rulings do not constitute reversible error.
We reverse the trial court's judgment insofar as it awarded punitive damages on the jury's finding of wantonness, and we render a judgment for Wal-Mart on the wantonness claim. We affirm the judgment insofar as it awarded damages based on the negligence claims.
AFFIRMED IN PART; REVERSED IN PART; AND JUDGMENT RENDERED.
MADDOX, SHORES, HOUSTON, KENNEDY, COOK, and SEE, JJ., concur.
LYONS, J., recuses himself. | 6931749d32b04c0d56ccff953db9ccc39007cbf31b0cd8fa5bb57e5039b76cf6 | 1998-12-18 00:00:00 |
b92e8a22-1bb5-440b-a4af-9182629dba17 | James v. McKinney | 729 So. 2d 264 | 1961410, 1961639 | Alabama | Alabama Supreme Court | 729 So. 2d 264 (1998)
Fob JAMES et al.
v.
Dorothy Alice McKINNEY and the Alabama State Employees Association.
Walter Stevenson
v.
Fob James et al.
Nos. 1961410 and 1961639.
Supreme Court of Alabama.
November 20, 1998.
Rehearing Denied January 15, 1999.
*265 William P. Gray, Jr., legal advisor to the Governor; Robin G. Laurie, deputy atty. gen.; and Martin E. Burke of Balch & Bingham, L.L.P., Montgomery, for appellants/cross appellees Fob James et al.
James Allen Main of Beasley, Wilson, Allen, Main & Crow, P.C., Montgomery; and Mark J. Williams and Linda Baker Allen, Alabama State Employees Association, Montgomery, for appellees Dorothy Alice McKinney and the Alabama State Employees Association.
KENNEDY, Justice.
These appeals concern the employment status of the "division chief" position within the Alabama Department of Economic and Community Affairs (hereinafter "ADECA") and the preclusive effect of a settlement among then Governor Jim Folsom, his personnel director, and the Alabama State Employees Association (hereinafter "ASEA").
In 1991, during Governor Guy Hunt's administration, Dorothy Alice McKinney, an employee at ADECA, was removed from her position as administrative division chief of ADECA and was assigned to another position. McKinney and the ASEA sued ADCA; the ADECA director; and Governor Hunt, requesting a judgment declaring that the position of division chief is a merit system position and an injunction requiring ADECA to staff the division chief positions with merit system employees and to reinstate McKinney to her position.
The litigation continued until 1993, when Governor Jim Folsom, the state personnel director,[1] the ADECA director, Ms. McKinney, and the ASEA entered into a settlement agreement. The settlement provided that as of October 1, 1996, the ADECA division chief positions would be merit system positions. On June 8, 1993, Judge Joseph Phelps dismissed the case with prejudice.
In September 1996, shortly before the merit system classification was to take effect, Governor Fob James and the current ADCA division chiefs sued, arguing that the settlement was not valid. McKinney and the ASEA moved to dismiss the lawsuit, arguing that the current division chiefs, who are not merit system employees, have no property interest in their positions and, therefore, no standing to bring this action. They also argued that the settlement entered into three years earlier was binding and not subject to collateral attack.
The trial court granted the motion to dismiss. In its dismissal order it wrote:
The civil service system of the state is divided by statute into the classified service, the unclassified service, and the exempt service. "Classified" civil servants attain their employment through a merit system based primarily on competitive examination. The purpose of making certain state employees subject to the merit system is to prevent discrimination in the employment, promotion, and discharge of public employees. Heck v. Hall, 238 Ala. 274, 190 So. 280 (1939). "Unclassified" and "exempt" civil servants are not subject to such examinations, and they serve at the pleasure of their appointing or electing authority. Generally those in the exempt service or the unclassified service are elected officials, officials chosen based on political patronage, and confidential employees.
The Governor and the current division chiefs argue that the language of the ADCA statute and the Merit System Act is ambiguous as to whether the position of division chief is a classified, an exempt, or an unclassified position. However, they conclude that the legislature intended for the division chiefs to be unclassified and not subject to the merit system. They argue that since the creation of ADECA, the division chiefs have been considered by ADECA officials to be in the unclassified service or the exempt service. They further argue that the settlement agreement purporting to place ADECA division chiefs in the classified service was illegal and, therefore, not binding.
We agree that the ADECA statute does not specifically place the division chiefs in either the exempt service or the "unclassified" service category, and we cannot say that the legislature intended for the division chiefs not to be subject to the merit system.
The legislature created ADECA in 1983, combining the following existing agencies and programs: the Office of State Planning and Federal Programs; the Alabama Department of Energy, the Alabama Law Enforcement Planning Agency; the Office of Highway and Traffic Safety; and the Office of Employment and Training. See § 41-23-2, Ala.Code 1975. Nowhere in the statute did the legislature specifically place division chiefs in either the exempt or the unclassified service. It is apparent that employees necessary to implement the duties of ADECA are subject to the merit system. § 41-23-2.
Section 36-26-10(b), a part of the Merit System Act, defines those officers in the exempt service. Section 36-26-10(c) defines those positions in the unclassified service. Section 36-26-10(d) states: "The classified service shall include all other officers and positions in the state service." In the definitional section of the Act, § 36-26-2, the "classified service" is defined as: "All offices or positions of trust or employment in the state service now or hereafter created except those placed in the unclassified service or exempt service by this article." Because the division chiefs were not placed in the exempt service or the unclassified service, the provisions of the Merit System Act compel us to conclude that the division chiefs are classified employees. Wyatt v. Bronner, 500 F. Supp. 817 (M.D.Ala.1980).
In Wyatt, the plaintiffs, one of whom was the deputy director, were employed by the Alabama Building Commission. From the outset of their employment, the plaintiffs were regarded as "unclassified" employees of the Commission. In fact, since 1945, the plaintiffs and the predecessors in their positions had been appointed and had worked outside the requirements of the merit system's hiring and firing procedures. Following their termination, the plaintiffs sued, alleging that they were "classified" employees under the Merit System Act and were entitled to the procedural protection afforded by the Fourteenth Amendment to the United States Constitution. The federal court held that nothing in the Merit System Act or in the act creating the Commission placed the plaintiffs in the unclassified or the exempt service. Therefore, the court held, based on § 36-26-10(d), the plaintiffs were classified employees and were therefore entitled to the type of hearing required by the Fourteenth Amendment. We agree with the federal district court's interpretation of Alabama law.
In Vaughn v. Shannon, 758 F.2d 1535 (11th Cir.1985), the United States Court of Appeals for the Eleventh Circuit held that *267 the plaintiff's job was exempt from the Merit System Act. The plaintiff, an employee of the Department of Mental Health, had relied on Wyatt in arguing that his position was "classified" and thus subject to the merit system. The plaintiff lost. The legislature, in creating the Department of Mental Health, had, by § 22-50-41, specifically left to the director of the Department the authority to determine which employee positions would be included in the merit system. Vaughn is easily distinguishable from this present case, because the legislature did not authorize the ADECA director to determine which employee positions at ADECA were subject to the merit system. Instead, the legislature made the employees of ADECA subject to the merit system.
The fundamental rule of statutory construction is to ascertain and give effect to the intent of the legislature. Advertiser Co. v. Hobbie, 474 So. 2d 93 (Ala.1985). When interpreting a statute, we must consider it as a whole and must construe it reasonably so as to harmonize all of its provisions. McRae v. Security Pacific Housing Services, Inc., 628 So. 2d 429 (Ala.1993). In determining legislative intent, a court should examine related statutes. Dunn v. Alabama State University Bd. of Trustees, 628 So. 2d 519 (Ala. 1993).
The nature of the responsibilities of an ADECA division chief also leads us to conclude that the legislature intended for the position to be in the classified service. The legislature created a merit system to protect certain civil servants from being dismissed as a result of their political affiliation every time a new administration was elected. Certain other positions, as to which confidentiality or political loyalty is necessary to the continued efficiency of the office, are not subject to the merit system. However, a division chief is not a policy-maker, nor is a division chiefs political affiliation necessary for continued efficiency in the job. Cf. Rutan v. Republican Party of Illinois, 497 U.S. 62, 110 S. Ct. 2729, 111 L. Ed. 2d 52 (1990); Branti v. Finkel, 445 U.S. 507, 100 S. Ct. 1287, 63 L. Ed. 2d 574 (1980); Elrod v. Burns, 427 U.S. 347, 96 S. Ct. 2673, 49 L. Ed. 2d 547 (1976).
An ADECA division chief is under the supervision of, and reports directly to, the director of ADECA. The division chief is not a policy-maker but, rather, implements goals and policies set by the director. Moreover, the promulgation of rules and regulations for ADECA is left solely to the director, not a division chief. § 41-23-6.
Accordingly, we conclude that the legislature intended that the ADECA division chiefs be subject to the merit system and that the settlement agreement to that effect is binding on the parties.
AFFIRMED.
ALMON and SHORES, JJ., concur.
HOUSTON and COOK, JJ., concur in the result.
HOOPER, C.J., and MADDOX and SEE, JJ., concur in part as to the rationale and dissent from the judgment.
LYONS, J., recuses himself.
HOOPER, Chief Justice (concurring in part as to the rationale and dissenting from the judgment).
I concur with Justice See. I add to his comments the observation that this judicial body is the highest judicial body of this State and that all its members have taken an oath to uphold the laws of our state. It is fundamental to a democratic society that the people's duly elected representatives enact the laws. The pivotal issue for this Court to determine is whether we will permit any Governor to undermine the laws, either by consenting to a judgment or by using any other means of changing the law that is outside the democratic processes of this State. I cannot, and will not, agree to such an undermining of the law. Clearly, the ADECA division chiefs are "unclassified" merit-system employees. To reach any other holding would appear to be contrary to the oath taken by the members of this judicial body. Such a result by-passes the lawful democratic processes of this State. Therefore, I concur with Justice See, and I reemphasize the duty of this Court to uphold the laws of this State and to maintain the integrity *268 upon which this judicial system is grounded.
SEE, Justice (concurring in part as to the rationale and dissenting from the judgment).
Although I concur with the portion of the main opinion's rationale that concludes that division chiefs of the Alabama Department of Economic and Community Affairs ("ADCA") are not "exempt" employees, I must respectfully dissent from the main opinion's conclusion that the division chiefs are "classified" merit-system employees. The Legislature has plainly provided that they are "unclassified" merit-system employees. Further, I conclude that no private settlement agreement can change a classification provided by statute.
The Legislature has divided state employment positions into three categories: (1) exempt positions; (2) unclassified merit-system positions; and (3) classified merit-system positions. "Exempt" employees or officers are generally not subject to the pay-scale, promotion, and other rules applicable to meritsystem employees. Exempt employees include:
Ala.Code 1975, § 36-26-10(b) (emphasis added.) ADECA division chiefs are not exempt employees, because they are heads of "divisions," not "departments," and they are appointed by the "director of [the] department, with the approval of the governor," not by the Governor or by a board or commission. See Ala.Code 1975, § 41-23-5(a) ("All chiefs of divisions shall be appointed by the director of [ADECA], with the approval of the governor."). In addition, § 41-23-2 provides that ADECA employees shall be "subject to the provisions of the state merit system laws." Thus, ADECA division chiefs are not exempt from the merit system, but are either "classified" or "unclassified" merit-system employees.
Unclassified merit-system employees are subject to all merit-system rules except for the protections concerning "appointment and dismissal." Ala.Code 1975, § 36-26-10(f). "Unclassified" employees include "[a]ll employees of the governor's office not exempted." Ala.Code 1975, § 36-26-10(c)(2). "Classified" employees are subject to all of the pay-scale, promotion, appointment, and termination rules of the State. "Classified" employees include "all other officers and positions in the state service." Ala.Code 1975, § 36-26-10(d) (emphasis added).
Section 41-23-1 states that ADECA is "within the office of the governor and directly under his supervision and control." Accordingly, ADECA's division chiefs are "employees of the governor's office" and are "not exempted." Thus, under § 36-26-10(c)(2), ADECA's division chiefs are clearly "unclassified" merit-system employees.
The main opinion cites Wyatt v. Bronner, 500 F. Supp. 817 (M.D.Ala.1980), for the proposition that the plaintiff employees of the Alabama Building Commission were classified merit-system employees because "nothing in the Merit System Act or in the act creating the Alabama Building Commission placed the plaintiffs in the unclassified or the exempt service." 729 So. 2d at 266. Despite the Alabama Building Commission's private listing of the employees on its payroll register as "exempt," the United States District Court for the Middle District of Alabama followed the statutory definitions in the Merit System Act and held that the plaintiffs were "classified" employees. Wyatt, 500 F. Supp. at 819-20. I agree.
Unlike the act creating the Alabama Building Commission, the act creating ADECA expressly provides that ADECA employees, who are not exempt, are "within the office of the governor and directly under his supervision and control." Ala.Code 1975, § 41-23-1. Further, the Merit System Act expressly provides that "employees of the governor's *269 office not exempted" are "unclassified" employees. Ala.Code 1975, § 36-26-10(c)(2). We must, of course, assume that the Legislature was aware of the Merit System Act's definitions of "exempt," "classified," and "unclassified" employees when it created ADCA and provided that ADECA's employees would be covered by the merit system. See Bedingfield v. Jefferson County, 527 So. 2d 1270, 1272 (Ala.1988) ("It is a fundamental principle that the legislature, in enacting a statute, is presumed to have full knowledge and information on prior and existing law on the subject of the statute."); Ala.Code 1975, § 41-23-2 (providing that "employees necessary to implement the duties and functions of [ADECA] may be employed subject to the provisions of the state merit system laws and shall be entitled to the same rights and benefits thereunder"). Therefore, this Court should apply the Merit System Act and conclude that the ADECA division chiefs are unclassified merit-system employees.
Had the Legislature intended to specify that ADECA employees would be "classified" employees, it could have done so. It did not. See Ala.Code 1975, § 41-23-2. Had the Legislature intended to amend the definition of "unclassified" and "classified" employees to treat employees such as ADECA division chiefs as "classified" employees, it could have done so. It did not. See Ala.Code 1975, § 36-26-10. Nor should this Court, whose function is to interpret law, amend the Merit System Act by creating a judicial exception to it.[2]
The main opinion states that "the settlement agreement [between the former Governor and the plaintiffs] ... is binding on the parties" to the extent it is consistent with the Merit System Act. 729 So. 2d 267. As I have demonstrated above, however, the settlement agreement is not consistent with the Merit System Act and, thus, cannot bind the State. Settlement agreements by state officers obligate state assets and state employees that are generally governed by Alabama law. To the extent such a private settlement agreement obligates state assets and employees in a manner inconsistent with state law, that agreement should be held invalid. See, e.g., Opinion of the Justices, 251 Ala. 91, 36 So. 2d 475 (1948) (stating that a lease agreement obligating the State to pay moneys for more than one year was void because the agreement would conflict with § 213 of the Constitution of Alabama of 1901, which prohibits state debts); Stokes v. Moore, 262 Ala. 59, 64, 77 So. 2d 331, 335 (1955) (holding that a contract calling for the issuance of an injunction if certain future events occur was invalid because it required the issuance of the injunction even if to issue an injunction would have been contrary to the opinion of the court).
As the main opinion points out, the United States Court of Appeals for the Eleventh Circuit held, in Vaughn v. Shannon, 758 F.2d 1535 (11th Cir.1985), that the director of the Alabama Department of Mental Health could determine whether employees of that Department were merit-system employees. Section 22-50-41 expressly provides that "[p]ersonnel policies may be established so as to include under the state merit system certain positions in the Department of Mental Health." The Eleventh Circuit determined that the Department of Mental Health had acted pursuant to the statute by internally providing that the plaintiffs were exempt employees. Vaughn, 758 F.2d at 1537.
Unlike the act that created the Department of Mental Health, the act that created ADECA does not delegate to the director of ADECA the power to determine the meritsystem classification of employees. Instead, it commands that employees hired by ADCA be employed "subject to the provisions of the state merit system laws." Ala.Code 1975, § 41-23-2.[3] The "state merit system *270 laws" clearly provide that ADECA division chiefs, who are in the Governor's office and who are not exempt department heads, are "unclassified" employees. See Ala.Code 1975, § 36-26-10(c)(2) (stating that "employees of the governor's office not exempted" are "unclassified" employees); Ala.Code 1975, § 41-23-1 (stating that ADECA is "within the office of the governor"); Ala. Code 1975, § 36-26-10(b) (stating that "exempt" employees include "heads of departments," not heads of "divisions"); Ala.Code 1975, § 41-23-5(a) (stating that ADECA division chiefs head "divisions," not "departments"). The Legislature, had it chosen to delegate the power to determine merit-system classification by private settlement agreement or otherwise, could have done so. See Ala.Code 1975, § 22-50-41 (delegating to the Department of Mental Health the power to determine the merit-system status of employees of that Department).[4] It did not.
Although the result for which the plaintiffs argue is not unreasonable, the method by which this result would be accomplished would endanger the constitutionally mandated process for making law. A private settlement agreement cannot displace statutes duly enacted by the Legislature. The concept of government by private agreement is wholly incompatible with our Constitution, which provides that the Legislature, to make law, must duly enact a bill and submit it to the Governor. Ala. Const.1901, § 61 ("No law shall be passed except by bill ...."); id. at § 125 ("Every bill which shall have passed both houses of the legislature ... shall be presented to the governor...."). To hold otherwise would invite the danger that men could enter into collusive settlement agreements for the purpose of draining the State's treasury, restricting the Governor's appointment power, or changing the composition of this Court. The Framers of our Constitution wisely preempted this possibility by dividing the legislative, executive, and judicial powers so that we may have "a government of laws and not of men." Ala. Const.1901, § 43.
HOOPER, C.J., and MADDOX, J., concur.
[1] The state personnel director had intervened as a plaintiff.
[2] As Alexander Hamilton cautioned:
"The courts must declare the sense of the law; and if they should be disposed to exercise WILL instead of JUDGMENT, the consequence would be the substitution of their pleasure to that of the legislative body."
The Federalist No. 78, at 469 (Alexander Hamilton) (Clinton Rossiter ed., 1961).
[3] Ala.Code 1975, § 41-23-6, provides that "[t]he director of [ADECA] may prescribe ... reasonable rules and regulations for the conduct of its business." This provision does not purport to delegate to the director of ADECA the power to classify employees under the merit system.
[4] I note that Ala.Code 1975, § 36-26-10(e), provides:
"Except as to services denominated as exempt or unclassified services in subsections (b) and (c) of this section, the governor shall have the power by executive order to extend the provisions of this article to include additional positions or classes of positions."
Because § 36-26-10(c)(2) plainly provides that ADECA division chiefs are "unclassified" employees, they are not subject to an extension of the Merit System Act by executive order. | f68340737c75755afc5d8de7026e4911f43ba69a70371964acd5df8a29524eda | 1998-11-20 00:00:00 |
68b66f5b-b9fe-44c8-bb61-6cdc95052b3c | Ex Parte Sparks | 730 So. 2d 113 | 1970812 | Alabama | Alabama Supreme Court | 730 So. 2d 113 (1998)
Ex parte Steven Ray SPARKS.
(Re Steven Ray Sparks v. City of Weaver).
1970812.
Supreme Court of Alabama.
November 20, 1998.
*114 John T. Kirk, Montgomery, for petitioner.
Trudie Anne Phillips, Anniston, for respondent.
ALMON, Justice.
Steven Ray Sparks was arrested in the City of Weaver, and the City charged him with driving under the influence and running a stop sign. The district court found him guilty of both charges, and he appealed to the circuit court for a trial de novo. See Ala.Code 1975, §§ 12-12-70(b) and 12-12-71.
At trial in the circuit court, the police officer who arrested Sparks testified that he had detected the odor of alcohol on Sparks and that he administered field sobriety tests to determine if he was intoxicated. The officer further testified that Sparks failed the field sobriety tests and that Sparks refused to submit to an alcohol breath test.
Sparks testified in his own defense and admitted that he had run a stop sign. However, he denied that he was driving under the influence, stating that he weighed 225 pounds and that he had drunk only three six-ounce draft beers during the two hours before his arrest. He attributed his failing the field sobriety tests to physical problems with his knees and to being unable to see because, he said, he was forced to look into bright lights on the arresting officer's patrol car while he was performing the tests. Sparks also stated that, even though he may have smelled of alcohol, he speaks with a lisp and was sunburned at the time of his arrest, and that both of these factors may have contributed to his appearing to be intoxicated. Sparks further testified that, although he had refused to submit to a breath test because he thought the machine used for that test was unclean, he specifically asked for a blood test. Sparks said that police responded to his request by telling him that a blood test could not be administered until after he had submitted to a breath test.
On cross-examination, the City's prosecutor asked Sparks if he recalled having been convicted of DUI on a previous occasion.[1] This question elicited an immediate objection from defense counsel, and the circuit court sustained the objection. Defense counsel then moved for a mistrial. After the circuit court gave the jury a corrective instruction, and after no jurors indicated that they could not disregard the prosecutor's improper question, the court denied Sparks's motion for a mistrial.
The jury convicted Sparks of both of the charges brought against him. The circuit court sentenced Sparks on the DUI conviction to 24 days in jailwith four days to be served and 20 days suspendedand ordered him to pay a $1,500 fine, plus $141 court costs. On the conviction for running a stop sign, the court fined Sparks $100 and ordered him to pay $149 court costs. The Court of Criminal Appeals affirmed Sparks's convictions with an unpublished memorandum, holding that the circuit court did not abuse its discretion by denying Sparks's motion for a mistrial. Sparks v. City of Weaver, 727 So. 2d 182 (Ala.Cr.App.1997) (table). Sparks petitioned for certiorari review, and we issued the writ of certiorari to determine whether Sparks was denied his right to a fair trial when the City's prosecutor asked him about a prior DUI conviction and the circuit *115 court subsequently denied his motion for a mistrial.
It is undisputed that the City's prosecutor deliberately asked Sparks, in the presence of the jury, about a prior DUI conviction. Furthermore, it is uncontroverted that Sparks interposed a timely objection to the prosecutor's question and also made a timely motion for a mistrial. Thus, the only question to be resolved is whether the prosecutor's improper question[2] was so prejudicial to Sparks's case that it rendered the circuit court's corrective jury instruction insufficient to ensure a fair trial. If the prosecutor's question did evoke prejudice to that degree, then the circuit court abused its discretion by not granting Sparks's motion for a mistrial and his convictions are due to be reversed.
In its brief, the City relies on numerous decisions in which the Court of Criminal Appeals has held that granting a mistrial is unnecessary under circumstances similar to those of Sparks's trial. In those cases, the Court of Criminal Appeals has reasoned that, when a prosecutor asks a defendant about a prior arrest or conviction, and the question is objected to and the circuit court sustains the objection, a corrective instruction admonishing the jury to disregard the prosecutor's improper question is sufficient to eradicate any prejudice to the defendant's case and a mistrial is unwarranted. See, e.g., Breedlove v. State, 482 So. 2d 1277 (Ala.Crim.App.1985); Walker v. State, 428 So. 2d 139 (Ala.Crim. App.1982); Carter v. State, 405 So. 2d 957 (Ala.Crim.App.), cert. denied, 405 So. 2d 962 (Ala.1981); Favor v. State, 389 So. 2d 556 (Ala.Crim.App.1980).
However, notwithstanding the cases cited by the City, this Court cannot condone a prosecutor's attempt to elicit testimony about a defendant's prior convictions in violation of the general exclusionary rule against such evidence. See Ex parte Tucker, 474 So. 2d 134 (Ala.1985); Ex parte Arthur, 472 So. 2d 665 (Ala.1985); Ex parte Cofer, 440 So. 2d 1121 (Ala.1983); Hinton v. State, 280 Ala. 48, 189 So. 2d 849 (1966); Ala. R. Evid. 404(b); C. Gamble, McElroy's Alabama Evidence, § 27.02 (5th ed.1996). Moreover, reported cases involving such improper questioning and a subsequent denial of the defendant's motion for a mistrialare all too common, as demonstrated by the number of such cases cited in the City's brief and in the Court of Criminal Appeals' memorandum affirming Sparks's convictions. Consequently, it appears to this Court that the current approach to these situations is inadequate insofar as it allows prosecutors a "free shot" at asking an improper question about a defendant's prior criminal record while providing little means to protect the defendant's right to a fair trial other than a mere corrective instruction to jurors, which is administered only after the defendant has been exposed to the prejudice caused by the prosecutor's questioning.
Given the highly prejudicial nature of evidence of a defendant's prior arrests and convictions, especially when the defendant is questioned about having previously been convicted of the same offense for which he is then being tried, it is difficult to expect that a jury could, even in all earnestness, completely disregard the prosecutor's improper questioning in reaching its verdict. There are some errors that simply cannot be corrected with a mere corrective instruction to the jury:
Quinlivan v. State, 579 So. 2d 1386, 1389 (Ala.Crim.App.), writ quashed, 596 So. 2d 658 (Ala.1991) (quoting United States v. Garza, 608 F.2d 659, 666 (5th Cir.1979)). The prosecutor's improper questioning in Sparks's case squarely falls into this category of errors that cannot be rectified by simply instructing the jurors to disregard the prejudice that has already been inflicted.
The City presented evidence to support its DUI charge against Sparks. Nonetheless, a conviction on the DUI charge was by no means a certainty, because in his defense Sparks presented evidence that, if believed by the jury, could have established a reasonable doubt as to his guilt on the DUI charge. Consequently, the prosecutor's improperly questioning Sparks about his previously having been convicted of DUI resulted in substantial prejudice to his defense. Because this prejudice could not be eradicated by a mere corrective instruction to the jury, the circuit court should have granted Sparks's motion for a mistrial. However, we reverse only the conviction on the DUI charge, because Sparks admitted that he had run the stop sign. The prosecutor's improper reference to the former DUI conviction could not have prejudiced Sparks on the charge of running the stop sign, because he admitted committing the act that constitutes that offense, and no issue of intent or degree of culpability was presented.
The judgment of the Court of Criminal Appeals is affirmed as to the conviction for running a stop sign and reversed as to the conviction for driving under the influence of alcohol, and the cause is remanded for further proceedings consistent with this opinion.
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.
HOOPER, C.J., and SHORES, KENNEDY, and LYONS, JJ., concur.
COOK, J., concurs specially.
SEE, J., concurs in part and concurs in the result in part.
MADDOX, J., dissents.
COOK, Justice (concurring specially).
I concur in the main opinion, and I write specially to address two additional points of concern: 1) Rule 609, Ala. R. Evid., clearly prevented the prosecutor from asking Sparks if he had been previously convicted of misdemeanor DUI. The prosecutor either knew or should have known that Sparks's previous DUI conviction was a misdemeanor. 2) The improper question inquired into whether Sparks had been convicted of the very same offense for which he was being tried.
I recognize that trial judges commonly cure improper prejudicial questions in the same manner the capable trial judge employed in this case, that is, by a query to the jurors, or a colloquy with them, to determine if they can disregard the improper evidence during their deliberations. By concurring in this case, I am not adopting the position that this procedure is no longer a proper means for addressing this problem. However, because, under the facts of this case, the question was so prejudicial, I agree that Sparks is entitled to a new trial.
SEE, Justice (concurring in part; concurring in the result in part).
I concur with the majority's affirmance of Steven Ray Sparks's conviction for running a stop sign. I concur in the result reached by the majority in reversing Sparks's conviction for driving under the influence ("DUI"). The prosecutor asked Sparks about a prior DUI conviction during Sparks's trial for the current DUI offense. I write separately to explain that a mistrial is not necessarily required in every DUI case in which a prosecutor inquires about a prior offense, but only in those cases where the particular facts indicate an egregious prejudice to the defendant.
After the prosecutor asked Sparks about a prior misdemeanor DUI charge to which Sparks had pleaded guilty, Sparks's counsel objected. The trial court properly sustained the objection. The trial court also instructed the jury to disregard the prosecutor's question. Sparks moved for a mistrial, claiming *117 he had been unfairly prejudiced by the impact of the prosecutor's question on his defense. The trial court denied that motion.
A mistrial is an extreme measure that should be taken only when the prejudice cannot be eradicated by instructions or other curative actions of the trial court. Nix v. State, 370 So. 2d 1115, 1117 (Ala.Crim.App.), cert. denied, 370 So. 2d 1119 (Ala.1979). If an error can be effectively cured by an instruction, a mistrial is too drastic a remedy and is properly denied. Thompson v. State, 503 So. 2d 871, 877 (Ala.Crim.App.1986). "[T]he grant or denial of a ... mistrial is a matter within the sound discretion of the trial court [and] will only be disturbed upon a showing of manifest abuse...." Durden v. State, 394 So. 2d 967, 972 (Ala.Crim.App.1980), writ quashed, 394 So. 2d 977 (Ala.1981).
Although generally a trial court's immediate instruction to the jury to disregard an improper prosecutorial question will cure any potential prejudice, Thompson v. State, 503 So. 2d at 877, the question objected to in this case was so prejudicial that the prejudice could not be erased by an instruction. The linchpin of Sparks's defense to the DUI charge was his assertion that his appearing to be under the influence of alcohol was caused by factors other than intoxication. Sparks testified on direct examination that he failed several field sobriety tests because of physical problems with his knees and because the headlights of the patrol car made it difficult for him to see. Sparks also attributed his appearance of intoxication to a lisp and to sunburn. On cross-examination, the prosecutor effectively dispensed with Sparks's DUI defense by asking about Sparks's prior DUI conviction. This question unmistakably impressed upon the minds of the jurors that Sparks's assertion that he had not been intoxicated was not credible.[3] Under these particular circumstances, a mere curative instruction could not effectively eliminate the prejudice to Sparks. Thus, the trial court abused its discretion when it denied Sparks's motion for a mistrial. Durden, 394 So. 2d at 972; Nix, 370 So. 2d at 1117.
[1] The record indicates that Sparks had been charged with DUI in January 1993. He subsequently pleaded guilty to the charge.
[2] The record reflects that the prosecutor defended her question to Sparks by calling the circuit court's attention to Ala. R. Evid. 609(a)(1)(B), which states:
"[E]vidence that an accused has been convicted of such a crime shall be admitted if the court determines that the probative value of admitting the evidence outweighs its prejudicial effect to the accused...."
However, the term "such a crime," as used in Rule 609(a)(1)(B) refers to the categories of crimes set out in Rule 609(a)(1)(A), which states:
"[E]vidence that a witness other than an accused has been convicted of a crime shall be admitted, subject to Rule 403, if the crime was punishable by death or imprisonment in excess of one year under the law under which the witness was convicted...."
Because Sparks could not have been punished by death or by imprisonment for more than a year for his prior DUI offense, his being impeached by questioning about that offense was clearly not allowed under any part of Rule 609 and the prosecutor's question was therefore improper.
[3] Rule 609, Ala. R. Evid., governs the impeachment of a witness by evidence of the witness's prior criminal convictions. Rule 609 states in pertinent part:
"(a) General Rule. For the purpose of attacking the credibility of a witness,
"(1)(A) evidence that a witness other than an accused has been convicted of a crime shall be admitted, subject to Rule 403, if the crime was punishable by death or imprisonment in excess of one year under the law under which the witness was convicted, and
"(1)(B) evidence that an accused has been convicted of such a crime shall be admitted if the court determines that the probative value of admitting this evidence outweighs its prejudicial effect to the accused; and
"(2) evidence that any witness has been convicted of a crime shall be admitted if it involved dishonesty or false statement, regardless of the punishment."
(Emphasis added.) Thus, Rule 609 limits impeachment concerning prior criminal convictions to evidence of crimes that either were felonies when they were committed or involved dishonesty or false statements. Because Sparks's prior DUI conviction was a misdemeanor and did not involve either dishonesty or false statements, the prosecutor's question was clearly improper. | 589a039aba04c4c3be2774454fe936dca119c7b06492cb079d4c3fb144c1288e | 1998-11-20 00:00:00 |
4e7def57-9314-425a-be86-46c112b31112 | Mashner v. Pennington | 729 So. 2d 262 | 1970738 | Alabama | Alabama Supreme Court | 729 So. 2d 262 (1998)
Dr. Melvin MASHNER
v.
W. Fred PENNINGTON, Jr.
No. 1970738.
Supreme Court of Alabama.
November 20, 1998.
Mark A. Newell and Susan Gunnells Smith of Janecky, Newell, Potts, Wilson, Smith & Masterson, Mobile, for appellant.
Harold A. Koons III of Ball & Koons, Bay Minette, for appellee.
KENNEDY, Justice.
On February 3, 1997, W. Fred Pennington, Jr., sued Dr. Melvin Mashner, a chiropractor, alleging the tort of outrage and breach of an implied contract.
Between February and June 1994, Pennington, his wife, their daughter, and their son went to Dr. Mashner for chiropractic adjustments. Before that time, Pennington and his wife had had difficulties in their marriage because of his wife's severe back injuries, which interfered with their sexual relations. Pennington and his wife told Dr. Mashner of their difficulties.
Subsequently, Dr. Mashner began an affair with Mr. Pennington's wife, which lasted from 1994 to March 2, 1996, when the Penningtons divorced. Mr. Pennington alleges that Dr. Mashner charged him for chiropractic services rendered for Mr. Pennington's wife, when his wife and Dr. Mashner were actually conducting an affair in Dr. Mashner's office.
Dr. Mashner filed his answer, specially averring that the Alabama Medical Liability Act applied in this case. The trial court held that the Act was not applicable. Dr. Masher petitioned this Court for a writ of mandamus, arguing that the Act applied and asking for an order directing the trial judge to apply it. We treated the mandamus petition as a petition for permission to appeal (see Rule 5, Ala. R.App. P.), and we granted that permission.
Effective May 17, 1996, the legislature "supplemented" the Medical Liability Act (see § 6-5-549.1(d)) to include licensed chiropractors as "health care providers," as that term is used in the Act. See, generally, § 6-5-549.1, Ala.Code 1975.
Section § 6-5-549.1(c) states:
(Emphasis added.)
Subsection (e) of 6-5-549.1 provides that "This section and Sections 6-5-548 and 6-5-549 apply to all actions pending against health care providers at the time of the effective date of the sections."
Clearly, the legislature expressly excluded chiropractors and chiropractic professional associations from the operation of that section of the supplement that informs a court how and when the Medical Liability Act is to be applied to pending actions against chiropractors.
Dr. Mashner argues that because Mr. Pennington's lawsuit was not pending, i.e., had not been filed, when the "supplement" was adopted, the Medical Liability Act applies. Mr. Pennington argues that as to chiropractors the Medical Liability Act applies only to actions based on causes of action that "accrued" after the effective date of the supplement. It is undisputed that this action had not been filed at the time the supplement became effective. It is also undisputed that the cause of action underlying this lawsuit had accrued before the date on which the supplement became effective.
We agree with Dr. Mashner that the legislature intended to make the Medical Liability Act applicable to all cases filed against chiropractors after the effective date of the supplement, regardless of when the cause of action accrued. The language in the supplement excepting "pending" actions against chiropractors does not change the supplement's application to cases that had yet to be filed.
In Ex parte Huntsville Hospital, 540 So. 2d 1344 (Ala.1988), the issue was whether the general forum non conveniens statute (§ 6-3-21.1) applied or whether the forum non conveniens provision of the Medical Liability Act (§ 6-5-546) applied in that particular malpractice case. Both statutes were part of the "Tort Reform" package of 1987 and became effective on the same day. The general forum non conveniens statute did not apply to any action "pending," i.e., filed, before the statute became effective on June 11, 1987. The legislature expressly stated in the Medical Liability Act of 1987 that the forum non conveniens provision applied to all malpractice causes of action "accruing" after June 11, 1987. In Huntsville Hospital, the cause of action had accrued prior to June 11, 1987, but the action had not been filed by that date. We held that because the malpractice cause of action had accrued before June 11, 1987, and because the Medical Liability Act specifically stated that its forum non conveniens provision applied to causes of action accruing after June 11, 1987, the general forum non conveniens statute applied.
Applying the logic of Huntsville Hospital to this present case, we conclude that the legislature intended for actions pending against chiropractors, i.e., those pending on the effective date of the "supplement" (because chiropractors were originally excluded from the Medical Liability Act of 1987), to be exempt from the application of the Medical Liability Act. However, those actions not yet filed were to be subject to the Act if the injury accrued after June 11, 1987, Ala.Code 1975, § 6-5-552.
Accordingly, we reverse the order holding that the Alabama Medical Liability Act did not apply to Mr. Pennington's claim, and we remand the action.
REVERSED AND REMANDED.
HOOPER, C.J., and MADDOX, HOUSTON, COOK, SEE, and LYONS, JJ., concur.
SHORES, J., concurs specially.
SHORES, Justice (concurring specially).
I agree with the majority's holding that § 6-5-549.1, Ala.Code 1975, which included licensed chiropractors within the definition of "health care provider" in the Medical Liability Act (the "Act"), applies to actions filed after May 17, 1996, the effective date of that section. Thus, the Act would apply to a medical malpractice action against a chiropractor that was filed after May 17, 1996. I write specially, however, to note that it is not really clear whether the facts of this case present a medical malpractice cause of action at all.
The Act applies only to medical malpractice actions; however, a plaintiff cannot avoid application of the Act by the use of creative pleadingit is the substance of the action, rather than the form, that is the touchstone *264 for determining whether an action is actually one alleging medical malpractice. Allred v. Shirley, 598 So. 2d 1347 (Ala.1992); Benefield v. F. Hood Craddock Clinic, 456 So. 2d 52 (Ala.1984); Sellers v. Edwards, 289 Ala. 2, 265 So. 2d 438 (1972). Mr. Pennington, however, is not complaining that Dr. Mashner's actions or omissions in treating his wife caused her to suffer or aggravated any injury. Compare Allred, Benefield, supra; Bowlin Horn v. Citizens Hospital, 425 So. 2d 1065 (Ala.1982). Indeed, Mr. Pennington seems to acknowledge that Dr. Mashner cured his wife's back injuries all too well. The gravamen of Mr. Pennington's breach-of-implied contract claim and his tort-of-outrage claim seems to be, rather, that he was billed for, and paid for, appointments for chiropractic services for his wife that he alleges Dr. Mashner never rendered, because, he says, Dr. Mashner and Mr. Pennington's wife were conducting a sexual affair during the appointments. I simply question whether such claims truly present a cause of action for medical malpractice. However, the trial court did not specifically address this issue, and the parties did not argue it in their briefs to this Court. Accordingly, we need not decide this issue at this stage of the proceedings. | e6d9f5e998bc431f7ecbcefbc21628e7184dc488e6b64c621cfd7f92ff66a269 | 1998-11-20 00:00:00 |
2aea2c53-6acf-40f2-b1d6-b2d74589671b | SELCO, SRL v. Webb | 727 So. 2d 796 | 1971645 | Alabama | Alabama Supreme Court | 727 So. 2d 796 (1998)
SELCO, S.R.L.; B.S.A., Inc.; and Biesse America, Inc.
v.
Wesley WEBB.
1971645.
Supreme Court of Alabama.
December 23, 1998.
*797 Stanley A. Cash and John D. Herndon of Huie, Fernambucq & Stewart, L.L.P., Birmingham, for appellants.
Ralph Bohanan, Jr., of Pittman, Hooks, Dutton & Hollis, P.C., Birmingham, for appellee.
HOUSTON, Justice.
Wesley Webb,[1] while employed and working as a saw operator at Jimson Manufacturing Company in Haleyville, caught his leg in a saw and was injured. On August 25, 1997, Webb sued Selco, S.R.L., an Italian company, and B.S.A., Inc., asserting various products-liability claims against each of them as the designer, manufacturer, seller, and/or distributor of the saw, which he alleged was defective. Webb requested that B.S.A. be served by certified mail in care of G. Trimbell at 3500 Tryclan Drive, Charlotte, North Carolina 28217, and that Selco be served by certified mail in care of B.S.A., Inc., at that same address. The summons and complaint were returned to the clerk's office as "undeliverable." Alias summonses were issued on November 20, 1997, to serve B.S.A. and Selco in care of Fabio Burattini at 4110 Meadow Oak Drive, Charlotte, North Carolina 28208. On November 24, 1997, Rosanna Santoscoy, a receptionist at an office of Biesse America, Inc., signed the "Domestic Return Receipts" acknowledging delivery of the alias summonses.
On February 6, 1998, Webb moved for entry of default judgments against B.S.A. and Selco, because they had failed to file any pleading or to otherwise defend the lawsuit. On March 18, 1998, the trial court entered a default against B.S.A. and Selco, with leave for Webb to prove damages within 30 days. On April 28, 1998, Webb served on Selco and B.S.A. notice of the hearing to prove damages; the notice was sent to be delivered in care of Fabio Burattini, at the Meadow Oak Drive address in Charlotte, North Carolina. On May 7, 1998, the trial court awarded Webb $250,000 for negligence and $150,000 for wantonness "separately and severally, totalling damages of $400,000" against B.S.A. and Selco; therefore, the default judgment became final on May 7, 1998. Rule 55(c), Ala.R.Civ.P.; Maddox v. Hunt, 281 Ala. 335, 202 So. 2d 543 (1967). The order stated that copies of the order were to be mailed to Selco and B.S.A. in care of Fabio Burattini.
On May 18, 1998, Selco moved to set aside the default judgment against it and B.S.A. and to quash service against them, pursuant to Rule 55(c), Ala.R.Civ.P., or, in the alternative, Rule 60(b), Ala.R.Civ.P. In that motion, Selco argued that the default judgment entered against it was "void due to the failure of [Webb] to obtain proper service of process in conformance with the Alabama Rules of Civil Procedure and pursuant to the requirements of the Hague Convention Treaty" and that the default judgment entered against B.S.A. was void, and stating that "based on `[Selco's] information and belief `B.S.A. Inc.' is not a viable entity." Also, in the motion, Selco identified Fabio Burattini (the individual to whom the alias summonses were addressed) as the general manger of Biesse America, Inc., and it identified Rosanna Santoscoy (the person who had accepted the certified-mail packages) as Biesse America's receptionist. In its motion, Selco also stated that it had a meritorious defense to Webb's claims, that Webb would not be unduly prejudiced by setting aside the default, and that the default was not due to any culpable conduct on its part. On May 22, 1998, Selco filed a supporting memorandum brief with attached affidavits from Rosanna Santoscoy and Tito Mazzetta.
In her affidavit, Santoscoy stated that she was employed as a receptionist by Biesse America, Inc., in Charlotte, North Carolina; that on November 24, 1997, she had accepted delivery of the two certified-mail packages "because they were addressed to: c/o Fabio Burattini"; that the address provided on the certified-mail receipts was the proper address for Biesse America and not for Selco or for B.S.A.; that she was not aware of any legal entity known as B.S.A., Inc.; that she *798 was not authorized to accept service of process for either Selco or B.S.A.; and that she had forwarded the packages to Fabio Burattini, who was the general manager of her employer, Biesse America.
In his affidavit, Mazzetta identified himself as corporate counsel for Biesse America and Selco. He stated that Selco was an Italian company that produced saws and that Italy was a member of the Hague Convention; that neither Selco nor Biesse America was affiliated with an entity known as B.S.A and that neither Biesse America nor Selco was aware of an entity known as B.S.A. Mazzetta confirmed that Rosanna Santoscoy was not the registered agent for Biesse America, Selco, or an entity known as B.S.A., and that she was not authorized to accept service for Selco. Mazzetta further stated that, in November 1997, Fabio Burattini was not Selco's registered agent and was not authorized to accept service for Selco. According to Mazzetta, the address provided on the certified-mail return receipts addressed to Selco, S.R.L., and an entity known as B.S.A., Inc., was the proper address for Biesse America and not for Selco or B.S.A.
Webb responded to the motion to set aside the default judgment and to quash service by arguing, for the first time, that Biesse America had been properly served, claiming that it was served by certified mail, at its principal place of business, at the proper address, and that the individual named in the summons, Fabio Burattini, was listed with the secretary of state as the agent for service. According to Webb, although Biesse America was incorrectly named as "B.S.A.," the terms "B.S.A." and "Biesse" are phonetically pronounced the same, and the name "B.S.A." was given as the proper name during telephone conversations that an investigator for the law firm representing Webb had had with various persons when the investigator was trying to determine who was the distributor of Selco saws. Also, according to Webb, Biesse America was the American distributor for products manufactured by Selco and the allegations in the complaint clearly indicated that he was injured while working with a saw manufactured by Selco and distributed by "B.S.A." Therefore, asserted Webb, Biesse America was on notice that it was the party he had intended to sue. Attached to his response were the affidavits of Kenny Byrd, an investigator employed by Webb's law firm, and Ralph Bohannon, Jr., Webb's attorney of record.
In his affidavit, Bohannon stated that on May 6, 1998 (almost two months after the entry of the default but one day before the entry of the judgment awarding damages), he spoke with Mazzetta, corporate counsel for Selco and Biesse America: He said that in that conversation Mazzetta acknowledged that he was aware of the summons and complaint and indicated that he had forwarded them to Biesse America's insurance carrier.
In his affidavit, Byrd stated that, after making several telephone calls to various saw distributors, he determined that Biesse America was the United States distributor for Selco, S.R.L. and that its place of business was located in North Carolina; that he was advised by the North Carolina secretary of state that Fabio Burattini was the registered agent for Biesse America or "B.S. America"; and that he was given the 4110 Meadow Oak Drive address. Byrd also stated that he called the telephone numbers for "Biesse's" parts and sales department and was told that the company's name was "B.S.A., Inc."
On June 18, 1998, Selco and Biesse America moved to strike the affidavits of Bohannon and Byrd, arguing that "the substantive testimony in the affidavits [was] based on hearsay."
Also on June 18, 1998, pursuant to Rule 60(b), Biesse America moved to set aside the default judgment and to quash service on "B.S.A., Inc.," arguing that the complaint did not describe or identify the saw in any fashion; that the only named defendants in the complaint were B.S.A., Inc., and Selco, S.R.L.; and that Biesse America was not a named defendant. It also argued that Rosanna Santoscoy, the receptionist for Biesse America who had signed the receipt for the service on Selco and B.S.A, was not an employee of B.S.A. and was not the registered agent for Biesse America. According to Biesse America, Webb had, before November 20, 1997, learned from various saw distributors *799 and the North Carolina secretary of state that Biesse America was the distributor of Selco saws, but did not amend the complaint to properly substitute the correct name. Thus, argued Biesse America, the complaint did not give sufficient notice to Biesse America that it was the intended defendant and the mere use of the address was not sufficient; therefore, it would violate the guaranty of due process, Biesse America said, to allow service of a complaint against B.S.A., on a receptionist of Biesse America, to be taken as service on Biesse America.
On June 18, 1998, Selco, B.S.A., and Biesse appealed. On July 19, 1998, Biesse America filed with the trial court a "statement of evidence" of the hearing held on May 7, 1998. On August 4, 1998, the trial court approved the statement of evidence.
We note that the trial court had not ruled on the post-judgment motions before the appeal was filed.
According to Rule 4(a)(5), Ala.R.App. P., an appeal filed after the entry of a judgment but before the disposition of a post-judgment motion filed pursuant to Rule 55, Ala.R.Civ.P., shall be held in abeyance until the post-judgment motion is ruled upon. Selco's Rule 55 motion was filed on May 18, 1998, but had not been ruled on when Selco filed its notice of appeal on June 18, 1998. Because the court never entered a ruling, the motion was deemed to be denied by operation of law on August 16, 1998. See Rule 59.1, Ala.R.Civ.P. Therefore, the appeal filed on behalf of Selco and B.S.A. is deemed to have been effective on August 16, 1998, and our review as it relates to that appeal is a review of the trial court's denial of Selco's motion to set aside the default judgment. Biesse America's Rule 60(b) motion was filed on June 18, 1998, and the trial court had not ruled on that motion before Biesse filed its notice of appeal on the same day. However, a Rule 60(b) motion does not affect the time a judgment becomes final and it does not suspend the operation of the judgment. Therefore, Biesse America had no alternative but to file an appeal on June 18, 1998. Our review on appeal as it relates to Biesse America's appeal is a review of the default judgment against B.S.A.
There is no dispute between the parties that, as far as they are concerned, there is no legal entity known as "B.S.A." Therefore, we conclude that B.S.A. has no standing to appeal.
Selco contends that Webb failed to perfect proper service on it. Selco is an Italian company that produces saws, and Italy is a member of the Hague Convention. Service of process on corporations of foreign countries that are members of the Hague Convention, such as Selco, must be perfected according to the terms of the Hague Convention Treaty.[2] "[A] convention, such as the Hague Convention, `has the status of a treaty and consequently is the supreme law of the land.'" Ex parte Volkswagenwerk Aktiengesellschaft, 443 So. 2d 880, 882 (Ala.1983), quoting American Trust Co. v. Smyth, 247 F.2d 149, 153 (9th Cir.1957).
If service of process is not perfected according to the terms of the Hague Convention, the service is void.
Rivers v. Stihl, Inc., 434 So. 2d 766, 769 (Ala. 1983) (holding that service was not perfected on the defendant German corporation because the plaintiff had failed to strictly comply with the service-of-process requirements of the Hague Convention).[3] The Hague Convention *800 provides that each state is to designate a central authority to receive requests of service of documents. (Article 2.) Requests for service (which must conform to a model annexed to the Convention) should be sent, along with the documents in question, by the judicial officer of the state in which the documents originate to the designated central authority of the country in which the recipient is located. (Article 3.) When it receives a request, the central authority is to arrange service according to its internal laws. (Article 5.) Once service is perfected, the central authority must forward a certificate to that effect to the applicant. (Article 6.) If the request is insufficient for some reason, the central authority returns it and the unserved documents, along with a statement of its objections, to the applicant. (Article 4.) Rivers v. Stihl, 434 So. 2d at 769.
Webb's attempts to serve the summons and complaint on Selco did not follow the procedures outlined in the Hague Convention; therefore, service was not perfected. Rivers, at 770. When service is not proper, a judgment based on that service is void and must be set aside. See, e.g., Ex parte Pate, 673 So. 2d 427 (Ala.1995).
Because service of process on Selco was not perfected, the default judgment against Selco is void. The trial court erred in failing to set aside that judgment.
Biesse America argues that any judgment entered against it is void because of a lack of jurisdiction. It argues that the complaint did not name it as a defendant and that because B.S.A. was not a legal entity or an assumed name or a trade name for Biesse America, see, e.g., Ex parte CTF Hotel Management Corp., 719 So. 2d 205 (Ala.1998); and Hughes v. Cox, 601 So. 2d 465 (Ala.1992), it had no notice that it was an intended defendant.
A plaintiff must properly name a defendant in order to properly sue that defendant. Ex parte Pate, supra, 673 So. 2d at 429; Cofield v. McDonald's Corp., 514 So. 2d 953 (Ala.1987). The trial court lacked jurisdiction to impose liability on Biesse America; therefore, the default judgment against "B.S.A." which was not an assumed name or trade name for Biesse America, did not impose liability on Biesse America. Biesse America, not being a party to this action has no right to appeal, and its attempt to appeal is void.
The judgment of the circuit court does not relate to Biesse America; thus, insofar as this appeal relates to Biesse America, it is dismissed. It appears that in this case there is in fact no entity named B.S.A., Inc.; thus, insofar as this appeal purports to relate to an entity named B.S.A., Inc., it is dismissed. Insofar as the judgment of the circuit court relates to Selco, S.R.L., that judgment is reversed and the cause is remanded.
APPEAL DISMISSED AS TO BIESSE AMERICA AND B.S.A., INC.; JUDGMENT REVERSED AS TO SELCO, S.R.L., AND CAUSE REMANDED.
HOOPER, C.J., and MADDOX, ALMON, SHORES, KENNEDY, SEE, and LYONS, JJ., concur.
COOK, J., concurs in the result.
[1] In various documents before this Court, including the notice of appeal, the cover page of the record, and portions of the briefs on appeal, Wesley Webb is named as Wayne Webb.
[2] The "Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters of November 15, 1965."
[3] In Rivers, although the plaintiff sought service of process on the defendant foreign corporation through the Hague Convention, he failed to complete two copies of a request form in English to accompany the documents to be served, as required by the Hague Convention. Therefore, the Court held, "since the procedure outlined in the Hague Convention was not followed, service of process was not perfected." 434 So. 2d at 770. | ffb80a0d991dec88579eec40475f7b503419341b2d1d58e7839768b22af04a83 | 1998-12-23 00:00:00 |
46914004-68d7-4c98-97b9-318316d75151 | Ex Parte Clarke | 728 So. 2d 135 | 1970242 | Alabama | Alabama Supreme Court | 728 So. 2d 135 (1998)
Ex parte Patricia CLARKE, individually and as executrix of the estate of Stanley Clarke, deceased
(Re Patricia Clarke, individually and as executrix of the estate of Stanley Clarke, deceased v. Allstate Insurance Company et al.)
1970242.
Supreme Court of Alabama.
December 11, 1998.
*136 Joseph C. Sullivan, Jr., and David A. Boyett III of Hamilton, Butler, Riddick, Tarlton & Sullivan, P.C., Mobile, for petitioner.
Louis Braswell of Hand Arendall, L.L.C., Mobile, for respondents Allstate Ins. Co., Wesley Mayfield, and Tommy Land.
ALMON, Justice.
The principal questions presented by this certiorari review are whether a purported endorsement was properly made a part of the plaintiffs' insurance policy; whether the summary judgment for the defendant insurer could properly be based on the insurer's arguments that the plaintiffs had breached their duty to cooperate with the insurer; and whether the plaintiffs supported their allegations that the insurer's requests were part of a "plan or scheme to intimidate or discourage insureds from pursuing legitimate claims by requiring insureds who filed a claim to submit to examination under oath by [the insurer's] attorneys and/or to produce or release extensive personal and financial information which had no relevance to the claim."
Stanley Clarke and his wife Patricia Clarke commenced this action against Allstate Insurance Company, alleging that Allstate had breached its contract with them and had acted tortiously by requiring them to submit to an examination under oath and to produce extensive personal and financial records as a prerequisite to Allstate's paying an insurance claim submitted by the Clarkes. The Clarkes also named as defendants Wesley Mayfield, the Allstate agent who had sold them their automobile insurance policy, and Tommy Land, the Allstate adjuster who investigated their claim. We shall refer to the defendants collectively as "Allstate." Stanley Clarke died after he and his wife had filed their complaint. Subsequently, Patricia, as the executrix of his estate, was substituted for him as a plaintiff.
The circuit court granted Allstate's motion for a summary judgment as to all claims. The Court of Civil Appeals affirmed the summary judgment, without an opinion. Clarke v. Allstate Ins. Co., 723 So. 2d 118 (Ala.Civ. App.1997) (table). Mrs. Clarke petitioned for certiorari review. We issued the writ to determine whether the affirmance by the Court of Civil Appeals conflicts with earlier decisions of this Court.
In July 1995, the Clarkes reported to police that their 1987 Chevrolet Blazer had been stolen. They filed a proof of loss with Allstate, their automobile insurer. A few weeks later, Patricia Clarke informed police and Allstate that she had found the Blazer in the parking lot of a Mobile apartment complex. The Clarkes filed with Allstate a second proof-of-loss form, claiming that their Blazer had been damaged during the time that it was allegedly stolen.
*137 Tommy Land, an Allstate adjuster, inspected the Clarkes' Blazer after it was recovered. In his deposition, he stated that the locks on the Blazer had not been broken and that none of the vehicle's electrical wires had been cut. Also, a police report indicated that the driver-side window on the Blazer had been broken from the inside. On the basis of these facts, Land concluded that whoever had taken the Blazer had done so with a key.
On September 14, 1995, Allstate, acting through one of its attorneys, mailed the Clarkes a letter informing them that, because of "the nature and circumstances of [their] loss," they were "requested ... to appear before [the attorney at a stated day and time] for the purpose of giving oral testimony under oath." Allstate requested that the Clarkes bring with them the following documents:
The letter represented to the Clarkes that their insurance policy included this provision:
The Clarkes did not appear for the scheduled oral examination. Allstate rescheduled the examination twice, but the Clarkes did not appear on either of the two later dates that Allstate selected. On October 18, 1995, Land mailed the Clarkes a letter informing them that Allstate assumed that they were not interested in pursuing their claim, because they had not submitted to an examination under oath. He enclosed with the letter a release document, and he asked the Clarkes to execute and return that document if they were indeed no longer interested in pursuing their claim. In the alternative, Land asked the Clarkes to contact Allstate to arrange another time for an oral examination. Like the previous letter from Allstate's attorney, Land's letter represented to the Clarkes that their policy provided:
Again, the Clarkes did not reply to Allstate's correspondence, and Allstate did not pay the Clarkes' claim. On October 27, 1995, the Clarkes initiated this action. In their complaint, the Clarkes alleged that Allstate had breached its contract with them and had committed the torts of bad-faith failure to pay a claim, fraudulent misrepresentation, suppression, and the tort of outrage. Moreover, the Clarkes alleged that the defendants had engaged in a civil conspiracy against numerous Allstate policyholders, including the Clarkes.
We have no indication that Mrs. Clarke argued to the Court of Civil Appeals that the summary judgment was erroneous as to the bad-faith, outrage, and conspiracy claims. Her certiorari petition raises no issue regarding the affirmance of the judgment as to those claims, and she makes no argument in her brief for a reversal as to those claims. Therefore, the judgment will be affirmed as to the bad-faith, outrage, and conspiracy claims.
In support of its motion for a summary judgment, Allstate submitted the affidavit of Noble Tinnea, an Allstate staff claims analyst. Tinnea attached to his affidavit an exhibit he stated was "a true and correct copy of the complete declaration page, policy jacket, and endorsements that were effective from July 25, 1995 through January 25, 1996, for Allstate Automobile Policy No. XXXXXXXXX, issued to Patricia and Stanley Clarke." Included in that exhibit is an endorsement, designated AU1372-7. The Clarkes' policy had been in effect since 1987, apparently with semiannual renewals. Allstate asserts that endorsement AU1372-7 was added to their policy in 1992. That endorsement provides:
*139 (Emphasis added.) The declarations page that is part of the exhibit to Tinnea's affidavit references endorsement AU1372-7 as being part of the Clarkes' policy.
Relying on this alleged endorsement, Allstate argued that, because the Clarkes had refused to submit to an examination under oath, they had failed to comply with their insurance policy's prerequisites for filing a claim for damage to their Blazer and had failed to cooperate with Allstate in its processing of the claim. Thus, Allstate contended, the Clarkes could not assert a breach-of-contract claim because they had not complied with all the provisions of their insurance contract.
In response to Allstate's argument, Patricia Clarke submitted her own affidavit, stating that she neither had received a copy of, nor had knowledge of, the alleged endorsement that Allstate was relying upon to require her and her husband to submit to an examination under oath. She said that, until Allstate proffered the alleged endorsement as an exhibit to Tinnea's affidavit, the only prerequisites to filing a claim that she knew about were those that were set out in the provision recited in the letters she had received from Allstate. Her affidavit stated: "A true and correct copy of our Allstate automobile insurance policy is attached hereto as Exhibit `A.'" Exhibit A to her affidavit reads like the two letters from Allstate; it does not include the alleged endorsement. That exhibit does not, however, include a copy of the declarations page.
On the basis of the statements in Patricia Clarke's affidavit, she argues that a material question of fact exists as to whether the endorsement proffered by Allstate was in fact a valid part of the Clarkes' insurance policy that would compel them to submit to an examination under oath. Mrs. Clarke contends that such a factual dispute should be resolved by a jury and that the circuit court consequently erred by entering the summary judgment on the breach-of-contract, misrepresentation, and suppression claims. She contends that the affirmance of that judgment as to those claims conflicts with Pinyan v. Community Bank, 644 So. 2d 919, 923 (Ala.1994) ("there [was] a genuine issue of material fact as to whether the parties formed a contract and as to what the terms of that contract would be"; thus, it was error to enter a summary judgment for the defendant); Mobil Oil Corp. v. Schlumberger, 598 So. 2d 1341, 1346 (Ala.1992) ("In a breach of contract action, a summary judgment is appropriate only where the contract is unambiguous and the facts are undisputed."); Gossett v. Twin County Cable TV., Inc., 594 So. 2d 635, 640 (Ala.1992) ("Unless the evidence submitted on a summary judgment motion is wholly without adverse inferences or is free from any doubt, summary judgment must not be entered, but the issues must be submitted to the jury."); and Quad Cities Nissan, Inc. v. Griffin, 638 So. 2d 830, 831 (Ala.1994) (on a summary judgment motion, a court views the evidence in the light most favorable to the nonmoving party).
The Clarkes' original policy, the provisions of which were cited in the letters they received from Allstate, contained no provision that would require them to submit to an examination under oath as a prerequisite to recovering on their insurance claim. The original policy required the Clarkes to provide Allstate a written proof of loss, including "all details reasonably required by [Allstate]"; to protect the insured property from further loss; and to report any theft loss to the police. The original policy also allowed Allstate to inspect any insured property that was damaged. However, nothing in the original policy allowed Allstate to require the Clarkes to submit to an examination under oath. Moreover, no part of that policy entitled Allstate to request the broad range of documents it requested or to require the Clarkes to submit to an examination under oath. Of course, the endorsement proffered by Allstate with its motion for summary judgment would expressly allow Allstate to subject the Clarkes to an examination under oath. However, the question whether that endorsement was properly made a part of the Clarkes' policy is sharply contested.
We note that this case is unlike Nationwide Ins. Co. v. Nilsen, [Ms. 1961955, June 19, 1998] ___ So.2d ___ (Ala.1998), because the policy in Nilsen undisputedly included a clause requiring the insured to "submit to an *140 examination under oath." ___ So.2d at ___.[1] Similarly, other cases relied upon by Allstate did not present a question whether such a clause had effectively been made a part of the insurance contract.
Ala.Code 1975, § 27-14-19(a), provides:
Section 27-14-1(1), Ala.Code 1975, defines the term "policy," as it is used in § 27-14-19(a), as including "endorsements" to insurance contracts. In Brown Machine Works & Supply Co. v. Insurance Co. of North America, 659 So. 2d 51 (Ala.1995), this Court addressed a situation in which an insurer failed to comply with § 27-14-19(a) by not mailing or delivering to an insured a copy of the insurance policy that was at issue in that case. In Brown Machine Works, the Court held that "an insurer who fails to follow the statutory mandate of § 27-14-19 may be estopped from asserting an otherwise valid coverage exclusion." 659 So. 2d at 58.
In her affidavit, Patricia Clarke denied that she had received, or had had any knowledge of, the endorsement. Allstate takes issue with the sufficiency of her denial, however, pointing out that she did not state whether Stanley Clarke had ever received, or had had knowledge of, the endorsement. However, Allstate first relied on the alleged endorsement when it submitted Noble Tinnea's affidavit in support of its motion for summary judgment. That affidavit is dated May 3, 1996. Stanley Clarke had died on November 19, 1995. Thus, Stanley Clarke never had any occasion to state whether he had received the endorsement Allstate claims to have sent, and presumably Patricia Clarke could not affirmatively state that he had not. Patricia Clarke's affidavit did not directly state that no copy of the endorsement was included among the Clarkes' papers regarding their Allstate policy. However, by submitting a copy of that policy, without the endorsement, as a "true and correct copy of our Allstate insurance policy," she presented substantial evidence that no copy of the endorsement was included with the Clarkes' copy of the policy. Together with Patricia Clarke's statement that she had not received the endorsement, the record contains substantial evidence indicating that Allstate had not mailed or delivered the endorsement to the Clarkes. We note that Noble Tinnea's affidavit does not state that the endorsement was mailed or delivered to the Clarkes, and Allstate did not submit any evidence that it was.
We are somewhat troubled by the failure of Mrs. Clarke to include a copy of the declarations page with the copy of the policy that she attached to her affidavit. The copy of the declarations page submitted by Noble Tinnea shows endorsement AU1372-7 as part of the policy. However, this reference in a 1995 semiannual renewal of the policy does not establish that Allstate had mailed or delivered the endorsement to the Clarkes in 1992 or thereafter. Mrs. Clarke's denial of the receipt of the endorsement, together with Allstate's failure to assert that it had mailed or delivered it, leaves a fact question as to whether the endorsement was delivered and was thereby made a part of the policy through compliance with § 27-14-19(a).
Furthermore, this conclusion is supported by the failure of Allstate itself to rely upon the alleged endorsement when it notified the Clarkes that it intended to examine them under oath. The two letters it sent them before they filed this action both quoted the original policy language rather than the language of the endorsement. In addition to supporting a finding that Allstate had not effectively made the endorsement a part of the Clarkes' policy, these letters might support a holding that Allstate had waived any reliance on the alleged endorsement. "[F]orfeitures are not favored by the law, and the insurer may waive provisions in [a] policy intended for [the] insurer's benefit." Employers *141 Ins. Co. of Alabama v. Crook, 276 Ala. 177, 185, 160 So. 2d 463, 470 (1964).
We conclude that the factual disputes made the summary judgment inappropriate as to the claim alleging breach of contract, and that, as Mrs. Clarke asserts, the Court of Civil Appeals' affirmance of that judgment as to that claim conflicts with the cases she has cited, especially Pinyan v. Community Bank and Mobil Oil Corp. v. Schlumberger, both supra. There was a factual dispute as to whether the endorsement was part of the Clarkes' insurance policy. Thus, Allstate was not entitled to a summary judgment based on its assertion that the Clarkes' had failed to comply with the "examination under oath" provision and with the provision requiring the insureds' cooperation. "What constitutes a failure of cooperation by the insured is usually a question of fact," and "[t]he burden of proof to establish non-cooperation rest[s] upon the insurer." Employers Ins. Co. v. Crook, 276 Ala. at 180, 160 So. 2d at 465 (citations omitted); State Farm Mut. Auto. Ins. Co. v. Hanna, 277 Ala. 32,, 38, 166 So. 2d 872, 877 (1964). American Auto. Ins. Co. v. English, 266 Ala. 80, 86, 94 So. 2d 397, 402 (1957). An insurer "cannot avoid its obligations on this ground" unless the insured's failure to cooperate "is both material and substantial." Home Indem. Co. v. Reed Equip. Co., 381 So. 2d 45, 48 (Ala. 1980); Alabama Farm Bureau Mut. Cas. Ins. Co. v. Teague, 269 Ala. 53, 56-58, 110 So. 2d 290, 293-94 (1959).
There is the further question whether Allstate's request for production of documents was permitted by the terms of the policy. Allstate contends that its document request was merely incident to its request for an examination under oath and, therefore, was reasonably encompassed by the provision of the endorsement. For this proposition, Allstate has cited Ransom v. Selective Ins. Co., 229 N.J.Super. 43, 550 A.2d 1006 (1988). We decline to follow the holding in Ransom in this case. Alabama courts have long held that insurance contracts are to be strictly construed against the insurer and liberally in favor of the insured. Tyler v. Insurance Co. of North America, Inc., 331 So. 2d 641 (Ala.1976). In Employers Ins. Co. v. Brooks, 250 Ala. 36, 39, 33 So. 2d 3, 5 (1947), the Court noted that the cases, as cited therein, "show[] a desire to give a reasonable construction to the conduct of [the] insured" in regard to the duty of cooperation. Similarly, courts should give a reasonable construction to the insured's right to ask for cooperation. "Furthermore, provisions of insurance policies must be construed in light of the interpretation that ordinary men would place on language used therein." Ho Bros. Restaurant, Inc. v. Aetna Cas. & Sur. Co., 492 So. 2d 603, 605 (Ala.1986).
In United States Fidelity & Guar. Co. v. Welch, 854 F.2d 459 (11th Cir.1988), the Court of Appeals for the Eleventh Circuit, applying Alabama law, declined to allow an insurer to separately examine its policyholders, a husband and wife, because the policy did not expressly give it the right to examine them separately. The court stated: "[S]trong public policy of Alabama supports the proposition that insurance companies should not be accorded ex gratia advantages which they did not insert in the policy...." 854 F.2d at 460.
As we have shown, neither the original policy nor the endorsement gave Allstate the right to require its insureds to produce documents other than "details reasonably required" by Allstate in support of an insured's written proof of loss. Even if the provision allowing Allstate to call for "details reasonably required" may be read to support Allstate's demand for some or all of the items listed under the first two headings in Allstate's September 14, 1995, letter ("INSURANCE POLICIES" and "DEEDS AND PROPERTY INFORMATION"), it cannot be read to support the demand for the items listed under the heading "TAX AND FINANCIAL INFORMATION." Furthermore, this third demand is so broad as to be unreasonable on its face.
For the foregoing reasons, we conclude that the evidence created genuine issues of material fact on the Clarkes' breach-of-contract claim and that Allstate, therefore, was not entitled to a judgment as a matter of law on that claim. The affirmance by the Court *142 of Civil Appeals is due to be reversed as to the contract claim.
The circuit court's summary judgment also related to the Clarkes' misrepresentation and suppression claims. The complaint makes the following factual averments:
The misrepresentation claim alleges that, by using the language in the original policy,[2] Allstate misrepresented "what would be required of the Plaintiffs in the event they filed a claim under their policy." The suppression claim alleges that Allstate failed to disclose that it would require insureds to submit to an examination under oath and to produce extensive and irrelevant personal and financial records as a prerequisite to its paying an insurance claim. As one can see from the evidence, as we have described it in our discussion of the contract claim, there is a jury question on the misrepresentation and suppression claims also.
In addition, we note that Land testified by deposition that he had been requiring examinations under oath for most of his 27 years with Allstate, and there is no indication that before 1992 Allstate had in its policies a clause that would have permitted it to require examinations under oath. Furthermore, Mrs. Clarke presented pattern-and-practice evidence tending to support the misrepresentation and suppression claims. Because Mrs. Clarke submitted substantial evidence in support of her misrepresentation and suppression claims, the court erred in entering a summary judgment for Allstate on those claims. The affirmance of the judgment on those claims conflicts, as Mrs. Clarke's petition asserts, with cases such as Soniat v. Johnson-Rast & Hays, 626 So. 2d 1256, 1258 (Ala.1993) ("In order to defeat a properly supported motion for summary judgment, the nonmovant must present `substantial evidence' supporting the nonmovant's position and creating a genuine issue of material fact"; summary judgment for the defendants on a fraudulent-concealment claim reversed).
The judgment of the Court of Civil Appeals is affirmed as to the bad-faith, outrage, and conspiracy claims. It is reversed as to the breach-of-contract, misrepresentation, and suppression claims, and the cause is remanded for further proceedings consistent with this opinion.
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.
SHORES, KENNEDY, and COOK, JJ., concur.
HOUSTON and LYONS, JJ., concur in the result.
HOOPER, C.J., and MADDOX and SEE, JJ., concur in part and dissent in part.
HOUSTON, Justice (concurring in the result).
I agree that the summary judgment was erroneously entered as to the three claims presented to this Court. The record before us indicates a fact question as to whether the provision relied on by Allstate Insurance Company"[Allstate] may also require [any person making a claim on the policy] to submit to examinations under oath and sign the transcript"was a part of the Clarkes' policy at the time the Clarkes' motor vehicle was alleged to have been stolen. If the trier of fact finds that it was, then a judgment must be entered for the Allstate defendants.
*143 MADDOX, Justice (concurring in part and dissenting in part).
I concur in that portion of the main opinion affirming the judgment of the Court of Civil Appeals insofar as it relates to the plaintiffs' claims alleging bad-faith failure to pay an insurance claim, the tort of outrage, and conspiracy. I must dissent from that portion reversing as to the breach-of-contract, misrepresentation, and suppression claims. The main opinion states that "the record contains substantial evidence indicating that Allstate had not mailed or delivered the endorsement." 728 So. 2d at 140.
Once a defendant moving for a summary judgment makes a prima facie showing that no genuine issue of material fact exists and that it is entitled to a judgment as a matter of law, the burden then shifts to the nonmovant to present substantial evidence creating a genuine issue of material fact. Murdoch v. Knollwood Park Hospital, 585 So. 2d 873, 876 (Ala.1991).
The main opinion concludes that the nonmovant, Patricia Clarke, met her burden by submitting a copy of the policy without the endorsement, the existence of which is a critical fact. She merely submitted a copy of the underlying policy without the endorsement or the declarations page and filed an affidavit stating that what she had submitted was a "true and correct copy of our Allstate insurance policy." Clearly, that is not substantial evidence creating an issue of fact, in view of the evidence presented by Allstate. Allstate provided an affidavit and a copy of the policy in question which, together, made a prima facie showing that the endorsement allowing Allstate to require an examination under oath had been made a part of the insurance contract in question. Mrs. Clarke presented no evidence, only her mere assertion, to indicate that the endorsement relied on by Allstate was in fact not part of the Clarkes' insurance contract. She certainly presented no evidence to indicate that Allstate had failed to notify her and her husband of the endorsement that would allow Allstate to require the insureds' testimony under oath. Black v. Reynolds, 528 So. 2d 848, 849 (Ala.1988) (stating that "[e]vidence offered in response to [a motion for summary judgment] ... must be more than a mere verification of the allegations contained in the pleadings"). In my opinion, Mrs. Clarke failed to meet her burden of presenting substantial evidence.
Because Mrs. Clarke offered no substantial evidence indicating that the Clarkes' Allstate policy did not include the endorsement allowing Allstate to require an examination under oath, the Court of Civil Appeals properly affirmed Allstate's summary judgment as it related to the breach-of-contract, misrepresentation, and suppression claims.
HOOPER, C.J., and SEE, J., concur.
[1] After this Court released its opinion in Nilsen, Allstate filed in this present case a motion for leave to file an additional brief discussing Nilsen, and it conditionally filed the brief. The Court has granted that motion, by a separate order. Mrs. Clarke moved to strike the supplemental brief, and she also filed a reply to it. The Court has denied the motion to strike, by a separate order, and we have considered her reply.
[2] That language is quoted above from the two letters sent by Allstate and its attorney to the Clarkes. | 9c0746bce6656450f98b407158209dfdc330e7fb1384191c1b1fe6f629fe6f32 | 1998-12-11 00:00:00 |
7386ebf0-809e-4e26-a466-14e6541bc238 | Ex Parte Woodward | 738 So. 2d 322 | 1980309 | Alabama | Alabama Supreme Court | 738 So. 2d 322 (1998)
Ex parte Jim WOODWARD.
(In re Mike Hale v. Alabama Electronic Voting Committee et al.).
1980309.
Supreme Court of Alabama.
November 20, 1998.[*]
Algert S. Agricola, Jr., of Wallace, Jordan, Ratliff & Brandt, L.L.C., Montgomery; and Albert L. Jordan, Michael L. Jackson, and Shara L. Gray of Wallace, Jordan, Ratliff & Brandt, L.L.C., Birmingham, for petitioner Jim Woodward.
C.C. Torbert, Jr., and Peter S. Fruin of Maynard, Cooper & Gale, P.C., Montgomery; Peck Fox of Steiner, Crum & Baker, Montgomery; Jack Drake of Whatley Drake, Birmingham; and Gregory H. Hawley and Stephen F. Black of Maynard, Cooper & Gale, Birmingham, for respondent Mike Hale.
Bill Pryor, atty. gen.; and John J. Park, Alice Ann Byrne, and Charles E. Grainer, Jr., asst. attys. gen., for respondents Alabama Electronic Voting Committee, Michael F. Bolin, Jim Bennett, George R. Reynolds, Polly Conradi, and Donald Keith.
This matter comes before the Court upon a petition, as amended and supplemented, by Jim Woodward, for a writ of mandamus directed to the Montgomery Circuit Court. The petition sought to have this court vacate a temporary restraining order (and now seeks to have it vacate a preliminary injunction) enjoining the defendants George R. Reynolds, Polly Conradi, *323 and Donald Keith, as members of the Jefferson County Canvassing Authority (hereinafter "Canvassing Authority"),[1] from proceeding with a recount of the votes cast in the November 3, 1998, election for the office of sheriff of Jefferson County, and from unsealing or examining the ballots cast in that election, until further order of the Montgomery Circuit Court in the case to which this petition relates, or the filing of an election contest by any person with standing to file an election contest pursuant to statutory authority.
In his petition, as amended and supplemented, Woodward (a candidate in the sheriff's election) alleges that the Canvassing Authority, as authorized by law or regulation, decided to conduct a recount, which was scheduled to begin on Monday, November 16, 1998, and was expected to last three days.
Mike Hale, Woodward's opponent in the sheriff's election, commenced an action against Woodward and the members of the Canvassing Authority and in that action obtained a temporary restraining order, and later a preliminary injunction, enjoining the recount. In proceedings before the trial court, Woodward was dismissed as a party, at the request of Hale, and the trial court denied Woodward's immediately ensuing request to intervene.
Section 307-X-1-.21 of the Alabama Administrative Code, promulgated pursuant to The 1983 Election Reform Act, Ala. Code, § 17-24-1 et seq., and particularly § 17-24-7(b), specifically authorizes the acts Hale sought to have enjoined. Section 17-24-7(a) incorporates, so far as is practicable, provisions of Chapters 8 and 9 of Title 17 dealing with voting procedures. Section 17-24-7(b) authorizes the Alabama Electronic Voting Committee, an entity created by § 17-24-4, to promulgate "other procedures where necessary to achieve and maintain the maximum degree of correctness and impartiality of voting, counting, tabulating, and recording votes, by electronic vote counting systems provided by this chapter."
The merits of Hale's challenge to the validity of § 307-X-1-.21 turn on whether § 17-24-7(b), with its reference to "voting, counting, tabulating, and recording votes," deals sufficiently with a broader subject-matter than the reference to "procedures for voting paper ballots and voting machines as prescribed in Chapters 8 and 9 of Title 17" (see § 17-24-7(a)), so as to displace provisions of Chapter 8 and Chapter 9 that expressly prevent the precontest recount allowed by § 307-X-1-.21. While § 17-24-10 saves provisions of Chapter 9 of Title 17 from repeal, it does so only to the extent that the provisions of Chapter 24 do not conflict. We make no determination at this juncture as to the merits.
We treat that aspect of Woodward's petition, as amended, attacking the preliminary injunction as an appeal of the order granting the preliminary injunction. Ex parte Health Care Management Group of Camden, Inc., 522 So. 2d 280 (Ala.1988). We also entertain other matters raised in the petitions, as amended.
We reverse the trial court's order denying leave to intervene. Woodward is a party entitled to intervene under Rule 24, Ala.R.Civ.P.
An application for a preliminary injunction should be granted only upon a showing of irreparable injury. Rule 65, Ala.R.Civ.P.; Seymour v. Buckley, 628 So. 2d 554, 557 (Ala.1993). The trial court grounded its finding of an irreparable injury on the conclusion that a precontest recount would deprive Hale of a property right and on the conclusion that the recount *324 would raise questions as to the integrity of the ballots. If the recount confirms Hale's victory, the prospects for a contest are substantially diminishedthus, Hale could be helped rather than hurt by the recount. On the other hand, if an accurate recount goes Woodward's way, then injury to Hale resulting from the disclosure of the fact that an accurate count shows he did not receive enough votes is not legally cognizable as a wrong as to which he has standing to complain. Finally, the risks of danger to the integrity of the ballots that would be raised by a precontest recount appear no greater than those that might attend a recount after contest, and, in any event, § 307-X-1-.21 includes ample provisions for assuring the integrity of the ballots. Permitting the canvass to go forward will not irreparably harm the integrity of the ballots or Hale's legally cognizable interests. We, therefore, reverse the order granting the preliminary injunction.
This Court has nothing before it in reference to that action styled Jim Woodward v. Polly Conradi et al., No. CV-98-6787, pending in the Tenth Judicial Circuit, and no aspect of our ruling today should be construed as affecting that proceeding. Moreover, nothing in this order affects in any way the time fixed by law in which Woodward might file a contest of the election or provides an alternative to the proceedings prescribed by law for contesting the election.
Based on the foregoing, it is ORDERED as follows:
The denial of the petition for leave to intervene, made orally in proceedings before the Montgomery Circuit Court on November 16, 1998, is reversed;
The orders granting the temporary restraining order and the preliminary injunction are reversed; and
All further proceedings are stayed pending an expeditious completion of the recanvassing of the ballots by the Jefferson County Canvassing Authority. At the expiration of the stay, the trial court shall resume proceedings necessary to the entry of a final judgment. Pending resumption of proceedings in the trial court upon expiration of the stay, this Court specifically retains jurisdiction of this cause to render such further or additional relief as may be required.
HOOPER, C.J., and MADDOX, HOUSTON, SEE, and LYONS, JJ., concur.
ALMON, SHORES, and KENNEDY, JJ., dissent. (Written dissent attached to this order. Further or modified dissenting opinions to follow.)[**]
KENNEDY, Justice (dissenting).
Because a majority of this Court decides that an order should be released today, I write the following:
The majority's order concludes that the parties to this action will not suffer "irreparable injury" by the breaking of the seals of the electronic voting machines in order to recount the votes cast in the general election and, therefore, the majority sets aside a preliminary injunction entered by the Montgomery Circuit Court that would prohibit the breaking of those seals absent statutory authority. The majority's actions clearly violate Alabama law, and I would hold that the trial court did not err in entering the preliminary injunction.[2]
The majority, in setting aside the injunction, holds that Ala.Code 1975, § 17-24-7(b), authorized the adoption of Alabama *325 Administrative Code § 307-X-1-.21, which allows any person with standing to contest an election to petition the canvassing authority for a recount. Section 17-24-7(b), plainly read, is not a statute that "authorizes" the adoption of administrative regulations allowing for the unlimited breaking of the seals of electronic voting machines. Section 17-24-7(b) is merely a statute that "authorizes" the adoption of administrative regulations to establish procedures for the maintenance or care of electronic voting machines in order to assure that they function properly.
Even assuming the majority's strained interpretation of § 17-24-7(b) is correct, § 307-X-1-.21 cannot function to allow a recanvassing under these circumstances, because it is in direct conflict with § 17-9-31 and § 17-9-35. Section 17-9-31 provides that "It shall be unlawful and constitute a misdemeanor... for any board of canvass, to break the seal of a voting machine for any purpose other than" those reasons expressly set out, none of which involves recanvassing. Section 17-9-35 provides that ballots and records of voting machines shall be preserved until that body that has authority is ordered to open them.
While it is a fundamental rule of statutory interpretation that this Court reads, construes and applies related statutes together, so that the legislature's intention can be gathered from the whole of the enactments, today a majority of this Court abandons this rule in order to reach the result it has fashioned. Because the majority's interpretation of § 17-24-7(b) is erroneous, what is left is an administrative regulation, Alabama Administrative Code § 307-X-1-.21, that conflicts with § 17-9-31 and § 17-9-35. It is well settled that the provisions of a statute will prevail in any case of conflict between the statute and an agency regulation. Ex parte State Dep't of Human Resources, 548 So. 2d 176 (Ala.1988). Accordingly, I dissent from the order issued today, and I rely upon § 17-9-31 and § 17-9-35 as authority for my belief that the majority's actions today violate Alabama law.
Moreover, even if we accept the majority's interpretation of § 17-24-7(b), to authorize recanvassing, that statute applies only to votes cast by electronic ballot and not to those votes cast by paper ballot. Therefore, "interested persons" in areas where paper ballots are cast would not be entitled to a recanvass. Clearly, in my opinion, this raises serious constitutional concerns based on the Equal Protection Clause.
Because the majority of this Court has determined that the issuance of its order should be immediate, I reserve the right to expand upon my dissent in the future. In addition, I defer discussion of any apparent irregularities that have occurred in the handling of this appeal.
SHORES, J., concurs.
[*] Note from the reporter of decisions: When this order was initially released, it inadvertently carried the incorrect date November 19, 1998.
[1] The Jefferson County Canvassing Authority is composed of the judge of probate, the circuit clerk, and the sheriff of Jefferson County. See Ala.Code 1975, § 17-14-1 et seq. Because Woodward is the current sheriff of Jefferson County, his position on the Authority was filled by Donald Keith, who serves as a captain in the Jefferson County Sheriff's Department.
[**] Note from the reporter of decisions: As of June 12, 1999, Justices Almon, Shores, and Kennedy all had left the Court by retirement, without filing a further dissent or modifying the dissent issued with the November 20, 1998, order.
[2] My writing should not be read to imply that Jim Woodward would not be entitled to file an election contest pursuant to Ala.Code 1975, § 17-15-1 et seq. | bcc325b303c6bb6b458c3d3fe8d33663c9ce18164dda41caf9df23b99f9105ed | 1998-11-20 00:00:00 |
4f8e0956-48d2-45e3-9428-5c13ce32b29d | Ex Parte Edwards | 727 So. 2d 792 | 1971840 | Alabama | Alabama Supreme Court | 727 So. 2d 792 (1998)
Ex parte Sharon K. EDWARDS.
(Re Sharon K. Edwards v. Ronald Walter Edwards).
1971840.
Supreme Court of Alabama.
November 25, 1998.
*793 J. Christopher Capps, Dothan, for petitioner.
Stanley P. Walker and J.E. Sawyer, Jr., Enterprise, for respondent.
LYONS, Justice.
Sharon K. Edwards, a party in a case pending in the Pike Circuit Court, petitions for a writ of mandamus directing the trial judge, Judge Robert W. Barr, to enter an order awarding custody of the parties' minor children to her and to vacate his orders of September 3, 1998, and September 10, 1998, setting pending issues for an evidentiary hearing and/or trial. For the reasons discussed below, we grant the petition in part and deny it in part.
When Sharon K. Edwards and Ronald Walter Edwards were divorced in February 1994, the mother was awarded custody of their two minor children. The father filed a petition to modify, in June 1997, requesting that custody of the children be awarded to him. The mother then filed an answer and a counterclaim, requesting a modification of the father's child-support obligation. On August 7, 1997, the trial court entered a judgment transferring custody of the children from the mother to the father. The mother appealed to the Court of Civil Appeals. On May 1, 1998, that court reversed the trial court's judgment and remanded the cause "for proceedings consistent with this opinion." Edwards v. Edwards, 720 So. 2d 956 (Ala.Civ.App.1998).
The father petitioned this Court for certiorari review. On May 21, 1998, at the father's request, the trial court ordered "that this cause be and the same is stayed pending appellate review of the Court of Civil Appeals' decision dated May 1, 1998."[1] The mother then petitioned this Court for a writ of mandamus directing the trial court to set aside its order staying the proceedings and to comply with the directive of the Court of Civil Appeals. On August 26, 1998, this Court denied certiorari review of the Court of Civil Appeals' May 1, 1998, judgment, and on September 29, 1998, we dismissed the mother's petition for the writ of mandamus as moot.
In the meantime, on August 31, 1998, the mother had filed in the trial court a "Motion to Enter Order in Accordance with Opinion of [the] Alabama Court of Civil Appeals." In that motion, she requested the trial court to enter an order returning custody of the children to her and ordering that the parties' divorce judgment entered on February 10, 1994, continue to govern the proceedings involving her and her former husband. We note that the mother stated in her motion that "the father returned the minor children to the mother Sunday, August 30, 1998, so that the children could be immediately enrolled in the Tallahassee School System." On September 3, the trial court entered the following notation on the case action summary sheet:
Also on September 3, 1998, the father filed a motion to have the case set for trial, and on September 10, 1998, the trial court scheduled the trial for December 1, 1998.
On October 1, 1998, the mother filed a motion with this court asking us to "reconsider" our denial of her petition for the writ of mandamus. We treated that filing as a motion to amend the petition for the writ of mandamus, and granted the motion. In her amended petition, the mother argues that the trial court's order setting this case for an evidentiary hearing and/or trial conflicts with the decision of the Court of Civil Appeals and with the subsequent orders entered by this Court. She also alleges that the trial court has not yet entered an order awarding custody of the children to her.
In his answer to the mother's petition, the father contends that the trial court complied with the Court of Civil Appeals' judgment when it set this case for "further proceedings consistent with" that court's opinion. The father states that issues regarding visitation and child support have yet to be resolved in this case. The father also states that "since further proceedings were ordered, [he moved] the Trial Court for trial so that he could present additional evidence (concerning facts occurring after the Trial Court's original judgment) in support of his Motion to Modify Custody."
In response, the mother argues that a hearing to determine child support is not necessary in this case because, she says, the trial court can determine the proper amount of support from income affidavits filed by the parties. She also argues that a hearing is not necessary to determine visitation, if the trial court grants her August 31, 1998, motion and orders that the parties' 1994 divorce judgment continue to apply. Finally, the mother argues that the doctrine of res judicata prevents the father from presenting new evidence regarding the issue of custody.
A petition for a writ of mandamus is the proper method for bringing before an appellate court the question whether a trial court, after remand, has complied with the mandate of this Court or of one of our intermediate appellate courts. Ex parte Brown, 562 So. 2d 485 (Ala.1990). Furthermore, a petition for a writ of mandamus is the proper method for seeking to have a trial court vacate an order that it had no power to enter. Great Atlantic & Pacific Tea Co. v. Sealy, 374 So. 2d 877 (Ala.1979). A writ of mandamus is an extraordinary remedy, however, that should be granted only if the trial court clearly abused its discretion by acting in an arbitrary or capricious manner. Ex parte Rollins, 495 So. 2d 636 (Ala.1986). The petitioner must demonstrate the following: "(1) a clear legal right in the petitioner to the order sought; (2) an imperative duty upon the respondent to perform, accompanied by a refusal to do so; (3) the lack of another adequate remedy; and (4) properly invoked jurisdiction of the court." Ex parte Adams, 514 So. 2d 845, 850 (Ala.1987).
We first address whether the trial court has complied with the mandate of the Court of Civil Appeals. "It is well settled that, after remand, the trial court should comply strictly with the mandate of the appellate court by entering and implementing the appropriate judgment." Auerbach v. Parker, 558 So. 2d 900, 902 (Ala.1989). In Ex parte Alabama Power Co., 431 So. 2d 151 (Ala. 1983), this Court stated:
431 So. 2d at 155 (quoting 5 Am.Jur.2d, Appeal & Error § 991 (1962)).
Clearly, the mandate of the Court of Civil Appeals required that the trial court enter a judgment awarding custody of the minor children to the mother. Instead of entering the appropriate judgment, however, the trial court set the case for an evidentiary *795 hearing and/or trial on December 1, 1998, relying on language commonly used by an appellate court to remand a cause for "proceedings consistent with" its opinion. No doubt, the "proceedings" referred to in the Court of Civil Appeals' opinion contemplated the entry of a judgment without a new trial or an evidentiary hearing. See, e.g., Murphree v. Murphree, 600 So. 2d 301, 303 (Ala. Civ.App.1992) ("given the facts and the language of the opinion, `further proceedings' meant a reduction in the amount of child support awarded").
The father now seeks to use the "proceedings" ordered by the trial court to present what he refers to as additional evidence regarding his petition for modification, evidence that he says concerns facts that occurred after the trial court had entered its "original judgment." Neither of the parties has included a copy of the father's petition with the supporting documentation submitted to us. We cannot tell, therefore, if the father is attempting to present additional evidence in support of his June 1997 petition for modification or if he has filed a new petition since that time. If he seeks to reopen the decision made regarding that 1997 petition, he may not do so in the proceedings scheduled for December 1, 1998. The custody determination is final with respect to the particular set of circumstances before the court upon which it made the decision that ultimately was reversed by the Court of Civil Appeals. See Self v. Fugard, 518 So. 2d 727 (Ala.Civ.App. 1987).
If the father has new evidence, however, that he believes would allow him to seek to have the most recent custody determination modified, then he may, if he has not already done so, file a new petition for modification with the trial court. Id. Contrary to the mother's contention, the issue of the proper custody of minor children is never res judicata. Ex parte Lipscomb, 660 So. 2d 986 (Ala.1994). If the proceedings scheduled for December 1, 1998, are for the purpose of considering a subsequent petition for modification based on evidence relating to events occurring after the August 7, 1997, determination was made, then those proceedings may go forward.
In addition to his allegations of new evidence, however, the father also contends that issues regarding visitation and child support remain unresolved. The mother argues that no hearing is necessary on those matters because, she says, the visitation schedule in the original divorce judgment can be used and the trial court can determine the appropriate amount of child support from income affidavits filed by the parties. Because we have not been provided with copies of the pleadings filed by the parties, we are not able to determine the issues that the trial court has the authority to address. Neither party informs us whether the issue of the modification of visitation was raised in the father's June 1997 petition. If it was, however, we cannot say that the trial court abused its discretion in scheduling a hearing to consider the visitation issue and to allow the parties to present evidence if necessary. The Court of Civil Appeals' opinion states that the mother's counterclaim, filed in response to the father's June 1997 petition to modify, sought a modification of the amount of child support paid by the father. Again, we cannot say that the trial court abused its discretion in scheduling a hearing to consider the child-support issue. A court often must consider factors other than the parties' income affidavits in calculating child support. See generally Alabama's "Child Support Guidelines," Rule 32, Ala. R. Jud. Admin. To the extent that the proceedings scheduled for December 1, 1998, are for the purpose of dealing with matters regarding visitation and/or child support that presently are pending, those proceedings also may go forward.
The mother's petition for the writ of mandamus is due to be granted insofar as it seeks an order awarding custody of the children to her in compliance with the mandate of the Court of Civil Appeals. The trial court is hereby directed to enter that order forthwith. To the extent that the proceedings scheduled for December 1, 1998, are intended to address other pending matters, however, those proceedings may go forward, subject to the following conditions:
1. Modification of the child support paid by the father may be considered, unless the *796 mother chooses to withdraw her request for that modification.
2. Modification of visitation may be considered if the father has asked for a modification of his visitation rights.
3. New evidence relating to events occurring after August 7, 1997, regarding the modification of custody of the children, may be considered only if the father presently has pending a petition for modification that was filed after August 7, 1997, and that has not yet been considered.
PETITION GRANTED IN PART AND DENIED IN PART; WRIT ISSUED.
HOOPER, C.J., and MADDOX, KENNEDY, and SEE, JJ., concur.
[1] We note that the condition under which the stay was entered, i.e., the then pending certiorari review of the Court of Civil Appeals' decision, no longer exists; therefore, it has expired by its own terms. We have not been asked to address the propriety of the initial entry of the stay. | e4bff65e2cb0cfd2fbd35129b59c43aca402dff9f963d23658366142ee20ff6b | 1998-11-25 00:00:00 |
7cf59c62-77e2-46eb-8187-1d5a6edfcc9c | Ex Parte Hooks | 728 So. 2d 631 | 1962182 | Alabama | Alabama Supreme Court | 728 So. 2d 631 (1998)
Ex parte Christine HOOKS and Walter L. Young.
(In re Calhoun County Commission
v.
Christine Hooks and Walter L. Young).
1962182.
Supreme Court of Alabama.
December 11, 1998.
Clifford L. Callis, Jr., and Jay E. Stover of Callis & Stover, Rainbow City, for petitioners.
Thomas N. Sowa, Anniston, for respondent.
LYONS, Justice.
The judgment of the Court of Civil Appeals, Calhoun County Comm'n v. Hooks, 728 So. 2d 625 (Ala.Civ.App.1997), is reversed and the cause is remanded for reconsideration in light of Ex parte Horn, 718 So. 2d 694 (Ala.1998).
REVERSED AND REMANDED.
*632 HOOPER, C.J., and ALMON, SHORES, HOUSTON, and COOK, JJ., concur.
MADDOX and SEE, JJ., dissent. | 7cfc5daafb7c52ec4f507d2d4285575683f8196d287ec1b3c2745a28462686c0 | 1998-12-11 00:00:00 |
41534c2e-2470-41e3-80f4-106cac804644 | Lyles v. Alabama State Docks Terminal Ry. | 730 So. 2d 123 | 1971280 | Alabama | Alabama Supreme Court | 730 So. 2d 123 (1998)
Daniel D. LYLES
v.
ALABAMA STATE DOCKS TERMINAL RAILWAY.
1971280.
Supreme Court of Alabama.
December 18, 1998.
Rehearing Denied March 12, 1999.
*124 J. Harry Blalock, Birmingham, for appellant.
Charles L. Miller, Jr., Mobile, for appellee.
KENNEDY, Justice.
Daniel Lyles appeals from a summary judgment entered in favor of the defendant, the Alabama State Docks Terminal Railway ("Railway").
A summary judgment is properly entered "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, ... show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Rule 56(c)(3), Ala.R.Civ.P. Once the moving party has made a prima facie showing that no genuine issue of material fact exists, the burden shifts to the nonmoving party to produce substantial evidence supporting its position and creating a genuine issue of material fact. § 12-21-12, Ala.Code 1975. "Substantial evidence" has been defined as "evidence of such weight and quality that fair-minded persons in the exercise of impartial judgment can reasonably infer the existence of the fact sought to be proved." West v. Founders Life Assurance Co. of Florida, 547 So. 2d 870, 871 (Ala.1989). In determining whether a summary judgment was properly entered, the reviewing court must view the evidence in a light most favorable to the nonmovant.
On February 28, 1996, Lyles was injured while working as a switchman for the Railway. At the time of the accident, Lyles was working on a crew that included him, the conductor, and the engineer. The crew was operating a train with 105 empty boxcars, and they were moving it to a storage track so that a "bad" boxcar, located in the middle of the train, could be removed and placed on a different track.
Lyles was riding on a boxcar at the end of the train. His job was to notify the other crewmembers by radio to let them know when the train was near the end of the storage track. Lyles's radio was not working properly, so the yardmaster was relaying Lyles's information to the engineer at the front of the train, which was over a mile away. The train was traveling between five and eight miles per hour. The train suddenly stopped and Lyles was thrown against a ladder and then was thrown off the train. Hitting the ladder caused an injury to his chest, and being thrown off the train caused an injury to his back. The fall rendered him briefly unconscious. When he regained consciousness, he told the yardmaster, by radio, that he had been injured. The yardmaster took Lyles to an infirmary, where he was treated for a contusion of the chest wall. Lyles also suffered pain in his lower back from the accident.
Lyles sued the Railway under the Federal Employers' Liability Act ("FELA"), 45 U.S.C. § 51. He claimed that the sudden stop had been due to negligent maintenance of the braking system or negligence on the part of the engineer. Lyles also claimed that this negligence violated the Safety Appliance Act ("SAA"), § 45 U.S.C. § 1. Additionally, Lyles argued that at the time of the accident his radio was not working properly and that the faulty radio had contributed to cause his injuries.
Congress enacted FELA in 1906 to establish "a tort remedy for railroad workers injured on the job." Lancaster v. Norfolk & Western Ry., 773 F.2d 807, 812 (7th Cir. 1985), cert. denied, 480 U.S. 945, 107 S. Ct. 1602, 94 L. Ed. 2d 788 (1987). It was enacted in response to the special needs of railroad workers, Sinkler v. Missouri Pacific R.R., 356 U.S. 326, 329, 78 S. Ct. 758, 761-62, 2 L. Ed. 2d 799 (1958), and it is liberally construed for their protection.
In a FELA action the question of what constitutes negligence is governed by federal law and it does not vary according to variations in state law. Urie v. Thompson, 337 U.S. 163, 69 S. Ct. 1018, 93 L. Ed. 1282 (1949). To prevail in a FELA action, the plaintiff must prove the traditional common-law elements of negligence: duty, breach of duty, foreseeability, and causation. Adams v. CSX Transp., Inc., 899 F.2d 536 (6th Cir. 1990).
Orchelle v. CSX Transp., Inc., 574 So. 2d 749, 753 (Ala.1990).
Lyles presented evidence indicating that when the engineer was applying the brakes, the train went into "emergency" and stopped suddenly. (C.R.121.) The engineer was told to slow the train, but was not told to stop it or to place it in "emergency." (C.R.99.) The train has a brake lever that the engineer uses to slow the train; if it is pushed all the way down, the train's brakes go into "emergency" and stop the train abruptly. (C.R. 121.) A train is not supposed to stop suddenly or go into "emergency" unless the engineer is told to place the lever into the emergency position. (C.R.101.) When a train goes into "emergency," the engineer no longer has control over the train. ( C.R. 120.) The conductor, who was also a train engineer, stated that a train's brakes can also go into "emergency" if there is an obstacle or "trash" in the air brake line. (C.R.105-07.) The conductor stated that he has known of trains going into "emergency" only a few times in the 16 years he has worked on railroads. (C.R. 106.) One could reasonably infer, based on the evidence presented, either that the engineer pushed the brake lever into "emergency" or that a defect in the brake line caused the train to go into "emergency."
Viewing the facts most favorably to Lyles, as we are required to view them, we conclude that the factfinder could determine that the engineer negligently placed the air brake lever into the "emergency" position and thereby caused the train to go into "emergency"a situation that would create liability under the FELAor could determine that a defect, i.e., "trash," in the air brake line allowed all the air to be released and thereby caused the train to go into "emergency"a situation that would create liability under the SAA.
Accordingly, the trial court erred in entering the summary judgment. That judgment is reversed and the cause is remanded.
REVERSED AND REMANDED.
ALMON, SHORES, and COOK, JJ., concur.
HOUSTON, SEE, and LYONS, JJ., concur in the result.
HOOPER, C.J., and MADDOX, J., dissent. | a5c604efc4dad10496a522387e64c11e5b527a4e0ca774a67df6ea0350aec89a | 1998-12-18 00:00:00 |
f998b79b-40ea-42a1-87c2-4e60611db060 | Ford Motor Co. v. Rice | 726 So. 2d 626 | 1970253 | Alabama | Alabama Supreme Court | 726 So. 2d 626 (1998)
FORD MOTOR COMPANY
v.
Mary RICE et al.
1970253.
Supreme Court of Alabama.
December 4, 1998.
Joseph S. Bird III, T. Michael Brown, and Kenneth M. Perry of Bradley, Arant, Rose & White, L.L.P., Birmingham; and Robert H. Turner, Marion, for appellant.
Joe R. Whatley, Jr., and Peter H. Burke of Cooper, Mitch, Crawford, Kuykendall & Whatley, L.L.C., Birmingham; R. Ben Hogan III of Hogan, Smith & Alspaugh, Birmingham; J.L. Chestnut of Chestnut, Sanders, Sanders & Pettaway, Selma; T. Roe Frazer II and Richard Freese of Langston, Frazer, Sweet & Freese, Jackson, MS; and Drayton Pruitt and Nathan G. Watkins of Pruitt, Pruitt and Watkins, Livingston, for appellee.
Samuel H. Franklin and Stephen J. Rowe of Lightfoot, Franklin & White, L.L.C., Birmingham, for amici curiae Product Liability Advisory Council, Inc., and Chamber of Commerce of the United States of America, in support of the appellant.
J. Mason Davis of Sirote & Permutt, Birmingham, for amicus curiae Greater Birmingham Area Chamber of Commerce, in support of the appellant.
Guy Tipton, Birmingham, for amicus curiae Alabama AFL-CIO.
SHORES, Justice.
Pursuant to Rule 5, Ala. R.App. P., this Court granted Ford Motor Company ("Ford") permission to appeal from an interlocutory order holding that Ford was not entitled to a summary judgment on the fraudulent-suppression claims of the named plaintiffs in this putative class action brought on behalf of Alabama residents who owned Ford Bronco II sport utility vehicles. We reverse and remand.
The named plaintiffs, Mary Rice, Brent Puckett, and Sandra Giles, are owners of Bronco II sport utility vehicles, a model manufactured and marketed by Ford between 1983 and 1990. The plaintiffs alleged that *627 each Bronco II contains a design defect that causes it to have an undue propensity to roll over in sudden-avoidance maneuvers. The plaintiffs also asserted that, as a result of testing it had conducted, Ford was aware of the Bronco II's rollover propensity but had fraudulently suppressed that information in order to induce the plaintiffs to purchase their vehicles. No plaintiff alleged that his or her Bronco II had actually rolled over and thereby caused personal injuries or property damage. Instead, the plaintiffs maintained that they had been damaged by being induced to purchase vehicles that they say were worth less than they would have been worth if they had been what Ford had represented them to be. That is, the plaintiffs contended that they did not get what they bargained for, in that their vehicles, they said, contain a safety defect that Ford fraudulently failed to disclose, thereby suggesting that the vehicles did not possess such a flaw. The plaintiffs admitted that they could not point to any tangible adverse economic consequences flowing from the alleged defect, such as diminished resale value in comparison to similar vehicles. Notwithstanding the fact, the plaintiffs maintained that they could still recover compensatory damages measured by the cost to "repair" the defect by lessening the risk of rollover, through modifications to the vehicles' wheels, tires, and suspension. The plaintiffs also sought punitive damages, attorney fees, and equitable relief ordering Ford to furnish "full and effective warning" to class members regarding the rollover dangers and enjoining Ford from selling replacement parts other than those that lessen the risk of rollover.
Ford moved, under Rule 12(b)(6), Ala.R.Civ.P., to dismiss the complaint for failure to state a claim upon which relief can be granted. Ford argued specifically that, under this Court's decision in Pfizer, Inc. v. Farsian, 682 So. 2d 405 (Ala.1996), the plaintiffs could not maintain their fraudulent-suppression claims because, Ford contended, they had not alleged that they had suffered any legally cognizable injury. After hearing oral arguments and receiving evidentiary materials from both sides, the trial court, treating Ford's motion as a motion for a summary judgment under Rule 56, Ala.R.Civ.P., denied it. See Rule 12(b), Ala. R. Civ. P.; Hornsby v. Sessions, 703 So. 2d 932 (Ala.1997); and Travis v. Ziter, 681 So. 2d 1348 (Ala.1996). The trial court then certified the plaintiffs' fraudulent-suppression claims as a class action, see Rule 23, Ala. R. Civ. P., with the named plaintiffs representing a class of all Alabama residents who, between August 26, 1993, and May 31, 1997, had owned Ford Bronco II vehicles. However, the trial court also certified the Pfizer question as a controlling issue of law for purposes of Rule 5, Ala. R.App. P., and we granted permission to appeal under that rule.
Section 6-5-102, Ala.Code 1975, provides, "Suppression of a material fact which the party is under an obligation to communicate constitutes fraud. The obligation to communicate may arise from the confidential relations of the parties or from the particular circumstances of the case." This Court has written: "The elements of a suppression claim are 1) a duty to disclose the facts, 2) concealment or nondisclosure of material facts by the defendant, 3) inducement of the plaintiff to act, and 4) action by the plaintiff to his injury." Foremost Ins. Co. v. Parham, 693 So. 2d 409, 423 (Ala.1997), citing Wilson v. Brown, 496 So. 2d 756 (Ala.1986).
This appeal involves only the element of actual injury, concerning which this Court has stated:
Boswell v. Liberty Nat'l Life Ins. Co., 643 So. 2d 580, 581 (Ala.1994), quoting Pihakis v. Cottrell, 286 Ala. 579, 583, 243 So. 2d 685, 688 (1971).
The main issue argued by the parties in this appeal is the applicability of Pfizer, Inc. *628 v. Farsian, supra. In that case, Farsian, the recipient of an artificial heart valve, which had not failed, filed an action in an Alabama state court alleging that the valve's manufacturer had fraudulently induced him to purchase the valve by misleading him about the rate of failure of the same model valve in other recipients. Farsian asserted, among other things, that the manufacturer had marketed the valve "despite knowing of serious manufacturing problems that directly related" to valve failures in other recipients. 682 So. 2d at 406. While he admitted that his own valve was, and always had been, functioning properly, Farsian claimed injury by maintaining that his valve, "with its higher rate of fracture and risk of death, [was] worth less than the valve would have been worth if it had been what [the manufacturer] represented it to be." Id. at 407. He also sought to recover damages for emotional distress and for expenses to have his valve surgically removed and replaced. Id. After the case was removed to a federal court, the United States Court of Appeals for the Eleventh Circuit certified to this Court the following question:
682 So. 2d at 406. We answered that the plaintiff could not recover, explaining as follows:
Id. at 407-08 (citations omitted).
Ford argues that Pfizer precludes the plaintiffs' claims in this case. Ford emphasizes that because none of the plaintiffs avers that his or her own vehicle has rolled over, the alleged defect of which the plaintiffs complain has never manifested itself in their vehicles. Ford contends that, just as the plaintiff in Pfizer could not recover under a fraud theory for the risk that his heart valve might fail in the future, the plaintiffs here cannot recover under a theory based solely upon the risk that their Bronco II vehicles could one day roll over. We agree that this case is controlled by Pfizer and that the plaintiffs' claims of injury are insufficient to sustain their action alleging fraudulent suppression.
The plaintiff in Pfizer maintained that he had suffered an economic loss because his valve's risk of failure was higher than what the manufacturer had represented it to be. However, based upon the plaintiffs' concession that his heart valve had never manifested the defect that had affected similar valves in other persons, we held that the plaintiff could not recover. This holding is in accord with the view of most courts, as "[i]t is well established that `[p]urchasers of an allegedly defective product have no legally recognizable claim where the alleged defect has not manifested itself in the product they own.'" Weaver v. Chrysler Corp., 172 F.R.D. 96, 99 *629 (S.D.N.Y.1997), quoting Hubbard v. General Motors Corp., No. 95 Civ. 4362, 1996 WL 274018, May 22, 1996 (S.D.N.Y.1996) (not reported in F.Supp.); see also Chin v. Chrysler Corp., 182 F.R.D. 448 (D.N.J.1998), citing cases. "Where ... a product performs satisfactorily and never exhibits the alleged defect, no cause of action lies." Weaver, supra, at 100 (citation omitted).
These plaintiffs' claim is similar to the plaintiff's claim in Pfizer. These plaintiff's aver that they have suffered lost value by the fact that their vehicles' risk of rollover is greater than was suggested by Ford's silence on the matter. The plaintiffs can point to no specific adverse economic consequences that have been caused by the alleged defect. The plaintiffs acknowledge that their vehicles, like the overwhelmingly vast majority of Bronco IIs, have never manifested the alleged defect in such a way as to be caused to roll over. Indeed, the plaintiffs' allegations give no indication that the vehicles in question, which have been on the road from 8 to 15 years, have provided their owners with anything but satisfactory performance.
The plaintiffs contend that their case is distinguishable from Pfizer, because their counterpart in Pfizer was seeking to recover based upon the possibility that his own valve, which could not then be shown to contain a defect at all, might exhibit one in the future, because defects had occurred in the valves of others. The plaintiffs urge that, by contrast, their vehicles' present performance capacity renders them all defective and unreasonably dangerous. Thus, the plaintiffs argue that their vehicles are all now "manifesting" the complained-of defect, in the sense that their design currently renders them physically incapable of executing certain avoidance maneuvers that a vehicle may be required to perform in the course of its foreseeable use, even though their vehicles have never rolled over because they have not been required to perform such a maneuver. We see no distinction between Pfizer and this present case.
Courts generally do not recognize a distinction between a defect that is "unmanifest" in the sense that it cannot be discerned to exist in a product and a defect that is "unmanifest" in the sense that, although perhaps impacting upon a product's present capacity for safety, it has never actually caused the adverse consequences feared by the user. Rather, courts have generally concluded that claims based upon allegations of inherent product "defects" that have not caused any tangible injury are not viable, even though the alleged defects could be considered "manifest" in the sense argued by the plaintiffs, i.e., that a product's present condition might have rendered it "unreasonably dangerous" in a products-liability context.
The most notable example of this for our purposes is American Suzuki Motor Corp. v. Superior Court, 37 Cal. App. 4th 1291, 44 Cal. Rptr. 2d 526 (1995), where owners of Suzuki Samurai sport utility vehicles brought a class action alleging that their vehicles contained a product "defect" as the result of an undue propensity to roll over and that their vehicles were therefore unfit to be used for their ordinary purpose. Like the plaintiffs in the present case, the Samurai owners did not claim that their own vehicles had actually rolled over, and they sought damages "measured by the cost of repairing the inherent safety defect in the Samurai." Id. at 1294, 44 Cal. Rptr. 2d at 528. In rejecting the plaintiffs' claims, the court explained:
Id. at 1298-99, 44 Cal. Rptr. 2d at 531 (emphasis added). Other courts have denied similar claims. See, e.g., In re Air Bag Products Liability Litigation, 7 F. Supp. 2d 792, 805 (E.D.La.1998) (dismissing all claims for lack *630 of injury, where plaintiffs claimed that air bags were "dangerously defective" because they deployed with excessive force); In re General Motors Corp. Anti-Lock Brake Products Liability Litigation, 966 F. Supp. 1525, 1530 (E.D.Mo.1997) (claims based upon allegations that anti-lock brakes were "defective" because they increased braking distance and therefore actually increased the chance of accidents, dismissed for failure to plead how the defect had ever manifested itself in the plaintiffs' vehicles); and Martin v. Ford Motor Co., 914 F. Supp. 1449, 1455 (S.D.Tex.1996) (claims alleging that the configuration of a seat-belt restraint system rendered vehicles "unsafe" were rejected on motion for summary judgment, where plaintiffs could not produce evidence of any injury, either physical or economic).
The plaintiffs suggest, further, that the presence of a condition that may render a product "unreasonably dangerous" in a products-liability context necessarily implies that a purchaser has thereby lost the benefit of his bargain. The gravamen of the plaintiffs' claims is that they received inadequate product quality because Ford failed to disclose to them that their vehicles are "unreasonably dangerous," notwithstanding that the vehicles have apparently performed satisfactorily for their entire useful lives. Thus, in order to establish the existence of an economic injury to sustain their fraud claims, the plaintiffs attempt to borrow an element from the Alabama Extended Manufacturer's Liability Doctrine (AEMLD), under which a plaintiff must prove, among other things, that he suffered injury or property damage as the result of a product that is "unreasonably dangerous." See Atkins v. American Motors Corp., 335 So. 2d 134, 142 (Ala.1976). However, this Court has explained that "`the standards of quality of a product, with the attendant risk of the bargain, are entirely distinct from its standards of safety, with a possible unreasonable risk of harm.'" Shell v. Union Oil Co., 489 So. 2d 569, 571 (Ala. 1986), quoting Mid Continent Aircraft Corp. v. Curry County Spraying Service, Inc., 553 S.W.2d 935, 940 (Tex.Civ.App.1977). Accordingly, it may be possible for a product to present an "unreasonable" risk of harm within the context of the AEMLD and yet cause no loss of bargain where the product is able to perform its intended purpose.
Nonetheless, in support of their argument that the law entitles them to recover damages to "repair" an existing defect in their vehicles, even absent a claim of any tangible physical or economic injury, the plaintiffs rely almost exclusively upon In re General Motors Corp. Pick-Up Truck Fuel Tank Products Liability Litigation, 55 F.3d 768 (3d Cir.1995) ("GM Fuel Tank Litigation"), a case in which owners of pick-up trucks alleged that the side-mounted location of the fuel tanks on their vehicles increased the risk of post-collision fuel-fed fires and constituted a product defect. A federal district court initially approved a multidistrict class-action settlement between truck owners, who claimed purely economic losses based upon the existence of the defect, and General Motors, the manufacturer of the trucks. The federal district court concluded that one of the major factors weighing heavily in favor of settlement was the difficulty that the plaintiffs would encounter in establishing damages, in that the plaintiffs could not prove that the defect had caused them to suffer a loss in the resale value of the trucks. Id. at 816. The United States Court of Appeals for the Third Circuit reversed the settlement approval order, holding, among other things, that the district court had erred in finding that the risks of proving damages were so great that they strongly favored a settlement approval. The Court of Appeals held that while a comparison of resale values would be a permissible approach to measuring the value of a defect, it also would have been permissible for the district court to examine the cost of retrofitting the vehicles to a "defect free" condition, "which effectively puts the truck in the condition in which it allegedly should have been delivered, ... [as] an alternative measure of the damages arising from the breach of warranty." Id.
In our analysis of this present case, we do not find a proper analogy in the United States Court of Appeals' decision in GM Fuel Tank Litigation, because of the procedural posture of that case. In its damages analysis, the Court of Appeals was merely attempting "to measure the expected value of litigating the action rather than settling it at [that] current time," for the purposes of assessing *631 the fairness of an approved class action settlement. 55 F.3d at 816. Thus, the Court of Appeals did not hold, as the plaintiffs here argue, that class members in that case actually could recover damages based solely upon the cost to "repair" an allegedly defective product, despite the fact that the defect had never manifested itself so as to cause any apparent physical or economic injury. Instead, the GM Fuel Tank Litigation Court merely "did not preclude the idea that class members who had not actually incurred problems with their automobiles might be entitled to equitable and monetary damages." Chin, supra, 182 F.R.D. at 460.
This case is similar to Pfizer in that the plaintiffs may not recover based solely upon the risk that their vehicles could malfunction in the future, given the lack of any claims indicating manifest injury. However, our holding to that effect does not imply that this Court is adopting the "economic loss rule" with respect to claims of fraudulent inducement. Under that rule, a cause of action does not arise under tort theories of negligence, wantonness, strict liability, or the AEMLD where a product malfunctions or is defective and thereby causes damage only to the product itself. See Wellcraft Marine, a Div. of Genmar Industries, Inc. v. Zarzour, 577 So. 2d 414 (Ala.1990); Dairyland Ins. Co. v. General Motors Corp., 549 So. 2d 44 (Ala. 1989); and Lloyd Wood Coal Co. v. Clark Equip. Co., 543 So. 2d 671 (Ala.1989). As the plaintiffs point out, this Court has often allowed a plaintiff to recover damages under a fraudulent-inducement theory for a purely economic loss to a product itself based upon value that is indicated by a seller's representations but not actually received, even where the product was in fact working properly. See, e.g., BMW of North America, Inc. v. Gore, 646 So. 2d 619, 621 (Ala.1994), rev'd on other grounds, 517 U.S. 559, 116 S. Ct. 1589, 134 L. Ed. 2d 809 (1996), on remand, 701 So. 2d 507 (Ala.1997); Simmons Auto Sales, Inc. v. Royal Motor Co., 489 So. 2d 518 (Ala.1986); Mobile Dodge, Inc. v. Waters, 404 So. 2d 26 (Ala.1981); Maring-Crawford Motor Co. v. Smith, 285 Ala. 477, 233 So. 2d 484 (1970).
This lawsuit involves this question: Does an alleged product defect that has not manifested itself in such a way as to cause any observable adverse physical or economic[1] consequences constitute an "injury" that will support a claim of fraudulent suppression? We simply hold that it does not.
We note that our holding does not leave remediless those who have purchased a vehicle that threatens their safety. We agree with the California court in American Suzuki, supra, that the remedy that will best promote consumer safety and address the parties' concern for their own safety is to petition the National Highway Traffic Safety Administration for a defect investigation. If the NHTSA determines that a vehicle contains a defect, then it may issue an order directing the manufacturer to remedy it through a recall. See 44 Cal. Rptr. 2d at 531-32, 37 Cal. App. 4th at 1299-1300.
Accordingly, we reverse the order of the trial court holding that Ford was not entitled to a summary judgment, and we remand the cause for further proceedings consistent with this opinion.
REVERSED AND REMANDED.
HOOPER, C.J., and MADDOX, ALMON, HOUSTON, KENNEDY, COOK, SEE, and LYONS, JJ., concur.
[1] The plaintiff in Pfizer did not claim that his heart valve had suffered from a loss in resale value; thus, this Court did not address the issue whether a claim of lost resale value, based upon a yet unrealized risk of malfunction, could be sufficient to sustain a fraud action. Given the plaintiffs' acknowledgment that they do not claim that their vehicles suffered a loss of value in the resale market, we need not resolve that question here either. We note, however, that some courts have at least implied that proof of lost resale value could be a sufficient economic injury to sustain such a fraud claim, even where vehicles have not failed to perform their intended function. See Connick v. Suzuki Motor Co., Ltd., 174 Ill. 2d 482, 221 Ill.Dec. 389, 675 N.E.2d 584 (1996) (reinstating a claim, under the Illinois Consumer Fraud Act, alleging that Suzuki Samurai sport utility vehicles had lost resale value because of their propensity to roll over); Martin v. Ford Motor Co., supra, at 1455 n. 7 (at least leaving open the possibility that, had the plaintiffs presented sufficient evidence of their vehicles' lost resale value, their claims might have survived a summary judgment motion). | cd260e58a2584f59c99a793a811ca9b49593cc480ae24b9c4628dacaec52d47b | 1998-12-04 00:00:00 |
9ec1ca72-5be8-408b-90aa-115965d62c40 | Horace Ex Rel. Horace v. Braggs | 726 So. 2d 635 | 1970266 | Alabama | Alabama Supreme Court | 726 So. 2d 635 (1998)
Ashley HORACE, a minor who sues by her father and next friend, Alphonse HORACE; and Alphonse Horace, individually
v.
Joyce BRAGGS.
1970266.
Supreme Court of Alabama.
December 18, 1998.
*636 Daniel G. Sayers, Mobile, for appellants.
Carl Robert Gottlieb, Jr., of Reams, Philips, Brooks, Schell, Gaston, Hudson & Gottlieb, P.C., Mobile, for appellee.
COOK, Justice.
Ashley Horace and her father Alphonse Horace appeal from a summary judgment entered against them in their action seeking compensation from Joyce Braggs for personal injuries Ashley suffered in a swimming pool accident. We affirm.
None of the facts necessary to the resolution of this case is in dispute. On October 1, 1994, Joyce Braggs organized a birthday party for her 5-year-old daughter at the home of Braggs's sister, Cybil Thomas. Approximately 14 children were invited to the party, and those who attended ranged from 1 to 13 years of age. Thomas's home was customarily used as a family gathering place, in part because there was a swimming pool on the Thomas property. The swimming pool was located behind the house and was partially surrounded by a "wooden privacy fence."
On one side of the house was a carport. It was there that Braggs set up a barbecue grill on which she cooked for the party guests. The wooden fence hid the pool itself from the view of persons in the carport. During the party, refreshments were being served inside the carport.
Among the invited guests was 5-year-old Ashley Horace. She attended the party accompanied by her father Alphonse; her 12-year-old brother Alphonse, Jr.; and her 10-year-old brother Allen. Like other guests at the party, the Horaces and the Braggses were close relatives.
As soon as they arrived, Ashley went into the pool and her father told Alphonse Jr. to watch out for her. Eventually, Ashley got out of the pool and went to the carport for refreshments. As soon as she had eaten a portion of a hamburger, she started to return to the pool. At the insistence of her father, however, she waited a few more minutes before returning to the pool.
After Ashley returned to the pool, Mr. Horace remained in the carport for 15-20 minutes. From the carport, he went inside the house, where he spent approximately 10 minutes. While he was inside, children discovered Ashley lying on the bottom of the pool and they pulled her out. Although she survived and has partially recovered, she has permanent brain damage.
On July 3, 1996, Ashley and her father sued Braggs in a two-count complaint, alleging that Braggs had negligently or wantonly "failed to provide a safe place that was watched by adult supervision for the minor child to swim thus allowing the child to enter the pool area and fall in." The court granted Braggs's motion for a summary judgment. The plaintiffs appeal.
The question in this case is whether a social host, who is not the property owner, owes a duty to provide adult supervision for a child's activities in the landowner's swimming pool while the child's parent or guardian is present on the premises, and where the social host has not been requested, and has not volunteered, to provide supervision for the child.
At the outset, we note that "water hazards" are not regarded as inherently "dangerous instrumentalities." Massey v. Wright, 447 So. 2d 169, 173 (Ala.1984) (emphasis added); see also Glover v. City of Mobile, 417 So. 2d 175, 179 (Ala.1982); Bailey v. City of Mobile, 292 Ala. 436, 439, 296 So. 2d 149, 152 (1974); Mayo v. Mobile Asphalt Co., 272 Ala. 442, 445, 131 So. 2d 881, 884 (1961). Also, "[i]t is well settled in Alabama that where the danger from the instrumentality which caused the injury is patent and obvious *637 the doctrine of attractive nuisance is inapplicable." Earnest v. Regent Pool, Inc., 288 Ala. 63, 66, 257 So. 2d 313, 316 (1972). (Emphasis added.) "[B]odies of water have long been held to present an obvious danger of drowning, even to children." Englund v. Englund, 246 Ill.App.3d 468, 476, 186 Ill.Dec. 57, 615 N.E.2d 861, 867, appeal denied, 153 Ill. 2d 558, 191 Ill.Dec. 618, 624 N.E.2d 806 (1993) (emphasis added).
Moreover, it has been held that "[w]hen small children are being watched by their parents, or entrusted persons in supervision, landowners may be relieved of [a] duty to warn them of or remove [a] dangerous instrumentality the danger from which is apparent." Strode v. Becker, 206 Ill.App.3d 398, 405, 151 Ill.Dec. 420, 564 N.E.2d 875, 880 (1990). In Baldwin v. Mosley, 295 Ark. 285, 748 S.W.2d 146 (1988), the trial court held that a parent's presence on the premises at the time a minor was injured "negated any duty" the premises owner may have owed the minor. Id. at 286, 748 S.W.2d 146. The Arkansas Supreme Court agreed, at least where the offending instrumentality presented an "open and obvious" danger. Id. at 288, 748 S.W.2d at 147.
Nowhere have we found this rule explained more fully than in Laser v. Wilson, 58 Md. App. 434, 473 A.2d 523 (Ct.Spec.App.1984), where a two-year-old child fell from a stairway in the home of a social host where the parents were present. Id. at 438, 473 A.2d at 525. Concerning the duty of the social host vis-à-vis the parents, the court stated:
Id. at 445-47, 473 A.2d at 528-29.
The Illinois Appellate Court's Englund case, supra, is essentially on point with this *638 present one. Like this present case, England involved a swimming pool accident that occurred at a children's birthday party while the parents were present on the premises. More specifically, the facts were as follows:
The trial court granted the homeowners' motion for a summary judgment, "implicitly [finding] that the homeowners had no duty to supervise Lauren under the circumstances." Id. at 472, 186 Ill.Dec. 57, 615 N.E.2d at 864. The Illinois Appellate Court agreed, stating: "We believe that the question of the homeowners' liability was properly decided as a matter of law in this case, since the homeowners had no duty to protect Lauren from obvious dangers, especially those apparent to Lauren's parents, who undertook to supervise Lauren." Id. at 474, 186 Ill.Dec. 57, 615 N.E.2d at 865 (emphasis added). That court further explained:
Id. at 476, 186 Ill.Dec. 57, 615 N.E.2d at 867.
The court also rejected an argument of the plaintiff that the homeowners had, in a deposition statement, "admitted their negligence." Id. at 478, 186 Ill.Dec. 57, 615 N.E.2d at 868. The alleged admission was: "We just got too relaxed." Id. The court merely reiterated that the parents, not the homeowners, had the "primary duty to watch Lauren." Id. (emphasis added). "Thus," the court explained, "even if the homeowners acknowledged that they were lax in their attention to Lauren, this does not relieve plaintiff of her duty to Lauren and does not render the homeowners liable for Lauren's death." Id. (emphasis added).
These cases suggest the proper holding and rationale in this case. The plaintiffs presented no evidence indicating that the primary duty for supervising Ashley had shifted to Braggs at the time of the accident. Mr. Horace expressly permitted Ashley to play in the swimming pool, and he knew that she was doing so. Thus, contrary to the allegations in the complaint, Ashley did not "fall in" the swimming pool, which, as we explained above, is not regarded in this state as a dangerous instrumentality.
Moreover, Mr. Horace knew that Braggs was busy attending to her guests and was not watching children in the pool. Indeed, he expressly ordered Alphonse Jr. to watch her. At no time, did Mr. Horace or Alphonse Jr. leave the premises. Under these facts, Braggs owed no duty to provide "adult supervision" for Ashley Horace. In other words, she owed no duty to provide more supervision for 5-year-old Ashley than she provided for her own 5-year-old daughter in whose honor the party was held.[1] See Laser v. Wilson, 58 Md.App. 434, 446, 473 A.2d 523, 529 (Ct.Spec.App.1984) (a social "host is not negligent [if] he has performed his duty of having the premises as safe for his guest as for his family and himself").
For these reasons, the trial judge properly entered the summary judgment for Braggs. That judgment is, therefore, affirmed.
AFFIRMED.
HOOPER, C.J., and ALMON, HOUSTON, KENNEDY, SEE, and LYONS, JJ., concur.
[1] What we said in Williamson v. Tyson Foods, Inc., 626 So. 2d 1261, 1266 (Ala.1993), is equally applicable here: "This decision is based on the specific facts in the record on appeal and it does not abrogate any other decision defining the scope of liability of a landowner; specifically, this decision does not affect that line of cases interpreting Restatement (Second) of Torts, § 339 (1977)." | d771b72b39f6cb3dddca727d7fb8bd6f68b4be651bf7c319583e1e99514e50ba | 1998-12-18 00:00:00 |
2008ffc0-3236-4fd4-b46f-a43263f338b4 | Ex Parte Nixon | 729 So. 2d 277 | 1971513 | Alabama | Alabama Supreme Court | 729 So. 2d 277 (1998)
Ex parte Anthony Paul NIXON.
(In re Anthony Paul Nixon v. State Department of Human Resources).
No. 1971513.
Supreme Court of Alabama.
December 23, 1998.
*278 James R. Knight and D. Todd McLeroy of Knight & Griffith, Cullman, for petitioner.
J. Coleman Campbell and Lynn S. Merrill, asst. attys. gen., Department of Human Resources, for respondent.
HOUSTON, Justice.
An administrative-hearing officer with the Alabama Department of Human Resources ("DHR") conducted an investigative hearing on October 23, 1996, to determine whether there was sufficient evidence to support DHR's preliminary finding that Anthony Paul Nixon, a public-school teacher, had sexually abused a minor child under his supervision. The hearing officer issued a final order on December 2, 1996, upholding DHR's preliminary finding. The Cullman County Circuit Court affirmed DHR's finding. Nixon appealed. The Court of Civil Appeals affirmed, without opinion, on April 17, 1998. Nixon v. State Dep't of Human Resources, (No. 2970303) (Ala.Civ.App.1998) (table). We granted Nixon's certiorari petition to consider his contention that the final order was unenforceable on the basis that, as DHR concedes, it was issued more than 30 days after the hearing. We affirm the judgment of the Court of Civil Appeals.[1]
Section 41-22-16, Ala.Code 1975, which is part of the Administrative Procedure Act, § 41-22-1 et seq., provides:
(Emphasis added.)
Applying well-settled rules, this Court has stated that if the language of a statute is clear then there is no room for judicial construction of the statute and the clearly expressed intent of the legislature must be given effect. Tuscaloosa County Comm'n v. Deputy Sheriffs' Ass'n of Tuscaloosa County, 589 So. 2d 687 (Ala.1991). The word "shall," when used in a statute, is mandatory. See, e.g., State of Alabama Department of Transportation v. McLelland, 639 So. 2d 1370 (Ala.1994). However, it does not follow that the use of the word "shall" always signals that the legislature intended for noncompliance with a mandatory provision to be fatal to a decision of an administrative agency, where the intent of the legislature, as *279 disclosed by all the terms and provisions of the statute in relation to the subject of the legislation and the general object to be accomplished, would be defeated by such an interpretation.
The Administrative Procedure Act, enacted in 1981, was intended to provide minimal procedural-due-process requirements for all state agencies to observe when taking actions affecting the rights and duties of the public. § 42-22-2; Benton v. Alabama Board of Medical Examiners, 467 So. 2d 234 (Ala. 1985). Section 41-22-2 provides:
Section 41-22-25 states that the Administrative Procedure Act "shall be construed broadly to effectuate its purposes."
One of the stated purposes of the Administrative Procedure Act as a whole, and of § 41-22-16 in particular, is to ensure that final administrative decisions in contested cases are not unreasonably delayed. Timely administrative decisions inure to the benefit of everyone concerned. Timely decisions also "increase public accountability of administrative agencies" (§ 41-22-2(b)(2)); "simplify government by assuring a uniform minimum procedure" (§ 41-22-2(b)(3)); "increase the fairness of agencies in their conduct of contested case proceedings" (§ 41-22-2(b)(6)); and "simplify the process of judicial review of agency action as well as increase its ease and availability" (§ 41-22-2(b)(7)). In other words, the 30-day provision in § 41-22-16(a) relates to the very essence of one of the primary objects the legislature sought to achieve by enacting the Administrative Procedure Actthe issuance of final administrative decisions within a reasonable time. See Mobile County Republican Executive Committee v. Mandeville, 363 So. 2d 754, 757 (Ala.1978) ("The distinction between a mandatory provision [in a statute] and one which is only directory is that when the provision of [the] statute is the essence of the thing to be done, it is mandatory.") Therefore, we conclude that in § 41-22-16(a), the word "shall" is mandatory.
Nixon contends that the 30-day provision in § 41-22-16(a) is not only mandatory but also jurisdictional. We agree that the word "shall" is mandatory; however, the record before us contains nothing to indicate that the legislature intended to deprive the hearing officer of jurisdiction if the officer did not render a final order within 30 days after concluding the hearing. Section 41-22-20(f), specifically states:
(Emphasis added.)
This provision would be meaningless if the 30-day provision in § 41-22-16(a) was *280 jurisdictional. We must assume that the legislature intended for all of the provisions in the Administrative Procedure Act to have a field of operation. See Ex parte Jackson, 625 So. 2d 425 (Ala.1992); Michael v. Beasley, 583 So. 2d 245 (Ala.1991).
Likewise, § 41-22-20(k) states the grounds for reversing or modifying the hearing officer's final decision:
(Emphasis added.)
Therefore, the circuit court has discretion to reverse or modify the hearing officer's report if it was made in violation of statutory provisions, made in excess of statutory authority, or made upon unlawful procedure (i.e., if the agency did not render an order within 30 days after the hearing is concluded), but only "if substantial rights of the petitioner have been prejudiced." This provision of the Administrative Procedure Act would be meaningless if the 30-day provision in § 41-22-16(a) was jurisdictional. If the 30-day provision was jurisdictional, then the circuit court would be required to hold that a hearing officer's report was void for being "[i]n violation of ... statutory provisions" or "[i]n excess of ... statutory authority" or "[m]ade upon unlawful procedure," if it was rendered more than 30 days after the hearing had concluded.[2]
Because Nixon has not shown that his substantial rights were prejudiced by DHR's 10-day delay in issuing its final order, the judgment of the Court of Civil Appeals is affirmed.
AFFIRMED.
HOOPER, C.J., and MADDOX, ALMON, SHORES, KENNEDY, COOK, SEE, and LYONS, JJ., concur.
[1] The evidence relating to the alleged sexual abuse is not pertinent to the issue presented on this review; therefore, we pretermit any discussion of the evidence introduced at the hearing.
[2] We note that § 41-22-16(a) was adopted from Fla. Stat. § 120.59 (1977), since repealed, 1996 Fla. Laws ch. 96-159 § 24, effective October 1, 1996. In Department of Business Regulation, Division of Pari-Mutuel Wagering v. Hyman, 417 So. 2d 671 (Fla.1982), the Florida Supreme Court rejected a lower court's construction of § 120.59 as invalid per se and concluded that an agency's violation of the 90-day provision in § 120.59(1) did not make the agency's final order invalid unless the delay impaired the fairness of the proceeding or the correctness of the action, thereby resulting in prejudice to the adverse party. See Department of Transportation v. Courtelis Co., 436 So. 2d 92 (Fla.1983).
We also note that § 41-22-20(f) was adopted from N.C. Gen.Stat. § 150 A-44 (1975 Cum. Supp.), now codified in N.C. Gen.Stat. § 150 B-44. In Davis v. Vance County Department of Social Services, 91 N.C.App. 428, 372 S.E.2d 88 (1988), the Court of Appeals of North Carolina recognized that § 150 B-44 provided a specific remedy when a final administrative decision was unreasonably delayed, i.e., when it was rendered beyond the time periods specified in § 150 B-44. See also In re Alamance Savings & Loan Ass'n, 53 N.C.App. 326, 280 S.E.2d 748 (1981).
Our interpretation of § 41-22-16(a) is consistent with the decisions of the Florida and North Carolina courts. Although those decisions are not binding with respect to this Court's interpretation of § 41-22-16(a), we find them persuasive. They support our conclusion that § 41-22-16(a) is mandatory, but not jurisdictional. | 2c039282d5bb132413b70fd12747a8192a20bbd64acdadeaf8ad5ec922479974 | 1998-12-23 00:00:00 |
a3c30271-f975-45e4-8371-716dae5274e5 | Ex Parte Amoco Fabrics and Fibers Co. | 729 So. 2d 336 | 1970497 | Alabama | Alabama Supreme Court | 729 So. 2d 336 (1998)
Ex parte AMOCO FABRICS AND FIBERS COMPANY.
(In re Danny STOKES and Phillip Williams v. AMOCO FABRICS AND FIBERS COMPANY, INC.).
No. 1970497.
Supreme Court of Alabama.
December 18, 1998.
Rehearing Denied January 15, 1999.
*337 David J. Middlebrooks of Lehr, Middlebrooks, Price & Proctor, P.C., Birmingham, for petitioner.
Truman M. Hobbs, Jr., of Copeland, Franco, Screws & Gill, P.A., Montgomery, for respondents.
LYONS, Justice.
The defendant Amoco Fabrics and Fibers Company ("Amoco") petitioned this Court for a writ of certiorari to review whether the Court of Civil Appeals erred in reversing the summary judgment entered by the trial court in favor of Amoco and against the plaintiffs Danny Stokes and Phillip Williams. See Stokes v. Amoco Fabrics & Fibers Co., 729 So. 2d 330 (Ala.Civ.App.1997). We granted review. For the reasons discussed below, we affirm the judgment of the Court of Civil Appeals.
The issue is whether Stokes and Williams produced substantial evidence to support the finding that Amoco's policy-and-procedure manual created an employment contract between its employees Stokes and Williams on the one hand and Amoco on the other that prevented Amoco from "laying off" those employees in any order other than by seniority.
Amoco hired Stokes and Williams to work in its Andalusia Mills facility in 1985 and 1987, respectively. Stokes and Williams say that throughout their employment, until they were laid off, Amoco had operated under what they describe as a general seniority policy. They say that Amoco set out part of this policy in an employee handbook distributed to all Amoco employees.[1] Stokes and Williams also maintain that the other part of Amoco's general seniority policy appeared in Amoco's manual of policies and procedures, which contained the following specific policy and procedure for a "LayoffReduction in Work Force":
This "layoff/reduction-in-workforce policy" appeared only in Amoco's policy-and-procedure manual. Amoco's employee handbook did not contain this specific policy. Amoco's policy manual was issued only to supervisors and was not distributed to other Amoco employees.
However, employees were informed of Amoco's general corporate practices and were told that the manual was available for their reference. Furthermore, both Stokes and Williams maintain that Amoco communicated its policies to them and followed both its general seniority policy and the lay off/reduction-in-workforce policy throughout their tenure. They say that their supervisors briefed them on the layoff/reduction-in-workforce policy and told them how it worked. Neither of them actually saw the written policy until June 1992, when Stokes went to the plant's human resources department after hearing rumors of an impending layoff. In response to his question about what kind of seniority would control in a layoff, a human resources supervisor referred him to the layoff/reduction-in-workforce policy in the manual.
On September 25, 1992, Amoco sold its Andalusia facility to Shaw Industries. When the sale became effective at midnight on the night of September 25, all employment with Amoco at the plant was terminated, with the exception of that of a few managers who were transferred to other Amoco facilities. Stokes and Williams contend that, on the afternoon of September 25, before the sale became effective, they were part of a group of seven industrial mechanics whose positions were terminated in an effort to reduce the industrial-mechanic department to meet Shaw's requirements. This decisionmade by Cary Baker, the Amoco plant manager, who became a Shaw employee when the sale became effectivedid not take into account the length of service of the employees. Stokes and Williams were offered lower-paying, entry-level positions with Shaw as "creel hands," but they refused these job offers.
Stokes and Williams then sued Amoco, alleging in part that Amoco's layoff/reduction-in-workforce policy formed the basis of an employment contract and that Amoco had breached that contract by terminating them without regard to their seniority.[2] In entering the summary judgment for Amoco, the trial court stated, in pertinent part:
In reversing the summary judgment, the Court of Civil Appeals held that the evidence could have supported a finding that Stokes and Williams were not at-will employees, and it concluded that a genuine issue of material fact existed as to whether the industrial mechanics were terminated by Amoco, in order to meet Shaw's demand for a reduction in the maintenance department.
The principles of law applicable to the granting of a summary-judgment motion are well settled. To grant such a motion, the judge must determine that no genuine issue of material fact exists and that the movant is *339 entitled to a judgment as a matter of law. Rule 56(c)(3), Ala. R. Civ. P. When the movant makes a prima facie showing that those two conditions have been satisfied, the burden shifts to the nonmovant to present substantial evidence creating a genuine issue of material fact. Bass v. SouthTrust Bank of Baldwin County, 538 So. 2d 794, 797-98 (Ala. 1989). Evidence is "substantial" if it is of "such weight and quality that fair-minded persons in the exercise of impartial judgment can reasonably infer the existence of the fact sought to be proved." West v. Founders Life Assurance Co. of Florida, 547 So. 2d 870, 871 (Ala.1989).
In reviewing a summary judgment, we apply the same standards as did the trial court. Ex parte Lumpkin, 702 So. 2d 462, 465 (Ala.1997). Our review is subject to the caveat that we must review the record in a light most favorable to the nonmovant and must resolve all reasonable doubts against the movant. Hanners v. Balfour Guthrie, Inc., 564 So. 2d 412, 413 (Ala.1990).
The bedrock principle of Alabama employment law is that, in the absence of a contract providing otherwise, employment in this state is at-will, terminable at the will of either party. Under this doctrine, an employee may be discharged for any reason, good or bad, or even for no reason at all. See Bell v. South Central Bell, 564 So. 2d 46 (Ala.1990). While at-will employment is indeed the traditional model, Alabama has, in the relatively recent past, imposed certain limits on an employer's right to discharge an employee. Among those limitations is an exception, recognized by this Court, for implied contracts arising out of the use of an employee handbook. In Hoffman-La Roche, Inc. v. Campbell, 512 So. 2d 725 (Ala.1987), Alabama adopted the position, taken by a number of other jurisdictions, that the provisions of an employee handbook can become a binding unilateral contract, thereby altering an employment relationship's at-will status. Modeled on the leading case of Pine River State Bank v. Mettille, 333 N.W.2d 622 (Minn.1983), Hoffman-La Roche represented a departure from the at-will employment doctrine, but it also recognized that not all employer communications would justify such treatment. Rather, only those employer communications meeting the traditional requirements for the formation of a unilateral contractan offer, communication, acceptance, and considerationwill bind the parties.
We must begin the Hoffman-La Roche analysis by determining whether the evidence in this case would support a finding that Amoco used the seniority provision in its manual as an offer of a unilateral contract fixing a term or condition of employment. "[To] become a binding promise, the language used in the handbook [i.e., the `manual'] must be specific enough to constitute an actual offer rather than a mere general statement of policy." Hoffman-La Roche, 512 So. 2d at 734, (citing Pine River, 333 N.W.2d at 626). Not only must we construe the language of the provision to be definite enough to form an offer, we must also determine whether the provision could have been meant to be an offer for a unilateral contract. "[W]hether a proposal is meant to be an offer for a unilateral contract is determined by the outward manifestations of the parties, rather than by their uncommunicated beliefs." Id.; see, also, Amoco Fabrics & Fibers Co. v. Hilson, 669 So. 2d 832, 835 (Ala.1995); Mayo v. Andress, 373 So. 2d 620 (Ala.1979). If the provision in the manual meets the contractual requirements for an offer, then we must determine whether the evidence indicates that the offer was communicated to the employees, either by issuance of the manual or otherwise. Id. Finally, we must determine whether the evidence indicates that the employees accepted the offer by continuing their employment after becoming aware of the offer. Id. By continuing their employment, the employees would supply the remaining elements of a unilateral contract, acceptance, and consideration. Id.
Stokes and Williams presented substantial evidence that could be taken to establish all elements of the Hoffman-La Roche test. First, they produced substantial evidence indicating that the language contained in the handbook and the policy-and-procedure manual is specific enough to constitute an offer. *340 The layoff/reduction-in-workforce policy specifically states that "[w]henever it is necessary to reduce the number of employees within a job classification the employee within that classification with the least job seniority will be reduced from that job." Furthermore, Stokes and Williams presented substantial evidence to support a finding that Amoco intended its seniority policy to be an offer. Both of them testified that Amoco communicated the policy to them as a benefit of employment, and Stokes testified that Amoco followed the seniority policy during his employment. This evidence of Amoco's "course of dealings" is exactly the same kind of evidence this Court found sufficient to create an offer in Hilson, supra. Accordingly, Stokes and Williams presented substantial evidence indicating that Amoco's manifestations created an offer.[3]
Second, Stokes and Williams produced substantial evidence to support a finding that Amoco communicated the offer to them either by the issuance of a handbook "or otherwise." While it is undisputed that Amoco did not distribute the policy-and-procedure manual to Stokes and Williams, they both testified in their depositions that their supervisors informed them of the layoff/reduction-in-workforce policy. Stokes also stated that Amoco had followed the policy up until his termination. He said that "[w]hen Amoco Fabrics and Fibers, Andalusia Mills first came to Andalusia, things just didn't work out right and they had to lay off and it was by seniority." Again, this "course of dealings" evidence is exactly the same kind of evidence to which this Court gave weight in finding a unilateral contract in Hilson, supra.
Finally, it is undisputed that Stokes and Williams continued their employment after Amoco informed them of the layoff/reduction-in-workforce policy. They both worked until 1992, when they were fired, long after they had learned of the policy. Therefore, Stokes and Williams presented substantial evidence from which the factfinder could find all three elements of the Hoffman-La Roche test, and we agree with the Court of Civil Appeals that the summary judgment was improper insofar at it was based on a conclusion that the evidence would not support a finding that Stokes and Williams had an employment contract with Amoco.
Amoco, however, argues that it had placed in its manuals a disclaimer stating that no part of its manuals constituted a binding contract, and it argues that, because of this disclaimer, the layoff policy could not be used to support a finding of a contract. This Court generally gives effect to disclaimers such as this one. See, e.g., Abney v. Baptist Medical Centers, 597 So. 2d 682 (Ala. 1992). However, it is undisputed that Amoco's disclaimer had no effect until October 1, 1990; this was several years after the time at which the evidence indicates that Amoco had communicated the layoff policy to Stokes and Williams and that they had accepted the policy by continuing their employment.[4] One party cannot unilaterally alter the terms of a contract after the contract has been made. See Kinmon v. J.P. King Auction Co., 290 Ala. 323, 276 So. 2d 569 (1973). Both parties must mutually assent to a modification. Id., 290 Ala. at 325, 276 So. 2d at 570. Because Amoco produced no evidence indicating that Stokes and Williams assented to the terms of the disclaimer, Amoco could not unilaterally rely on that disclaimer as altering the terms of the contract. Therefore, the original terms of the contract must be given effect.
*341 Furthermore, this Court held in Hilson, supra, that Amoco could not unilaterally "revoke [its] vacation pay policy" contained in its handbook "once the employees had performed." 669 So. 2d at 835. Because it is undisputed that both Stokes and Williams continued their employment after the date at which the evidence suggests Amoco had made the policy known to them, Amoco could not, by inserting a disclaimer after the fact, revoke the layoff policy that had formed a binding contract between the parties. Also, in Hilson, it was clear that Amoco, through its course of dealing with its employees, had followed its vacation-pay policy. As noted above, Stokes testified that Amoco had followed its layoff policy before. Stokes and Williams's evidence would support a finding of the elements necessary for the layoff policy to constitute a contract; such a contract should be enforced.
Amoco does not argue that the Court of Civil Appeals erred in concluding that a question of fact existed as to whether Amoco fired Stokes and Williams on September 25, 1992. Thus, we need not address that aspect of the Court of Civil Appeals' opinion.
The judgment of the Court of Civil Appeals is affirmed.
AFFIRMED.
ALMON, SHORES, HOUSTON, and KENNEDY, JJ., concur.
HOOPER, C.J., and MADDOX, COOK, and SEE, JJ., dissent.
HOOPER, Chief Justice (dissenting).
The purpose of this Court is not to undo the law that businesses have relied upon for years in preparing their contracts. A gradual erosion of a solid legal principle is different from a revolutionary overthrow in at least one key respectthe time it takes to accomplish the result. Judge Thompson's dissent predicts the alarming result this Court's opinion will have in the marketplace:
Stokes v. Amoco Fabrics & Fibers Co., 729 So. 2d 330, 335 (Ala.Civ.App.1997) (Thompson, J., dissenting). I believe Judge Thompson's prediction is accurate. It highlights the power of this Court to undermine a principle of contract law that is based on solid precedent. Perhaps there is another respect in which a gradual erosion of law differs from a revolutionary overthrow. It is more difficult for the people to perceive that the law has been altered if a court allows it to be slowly eroded.
I find the dispositive question in this case to be whether, based on the evidence, as it is stated in the main opinion, a factfinder could find that Amoco made a contract offer to its employees. We must evaluate the external and objective actions of Amoco to determine whether an employee reasonably could have believed that Amoco offered the employee the layoff/reduction-in-workforce policy and intended to be bound by its terms. It is undisputed that Amoco made its policy manual available to its employees, even though it was only distributed to supervisors. As illustrated by Stokes's testimony regarding his own experience, specific provisions of the policy manual were communicated to employees upon inquiry. However, I do not agree that these facts would be enough to create a reasonable belief that Amoco had offered the layoff/reduction-in-workforce policy to its employees.
Rather, I find that a reasonable employee would not have construed Amoco's activities as an offer for a unilateral contract. The evidence showed that Amoco did not actively disseminate its layoff/reduction-in-workforce policy, as contained in its policy manual, but disclosed it only sporadically in response to employees' questions. The fact that Amoco did not distribute its policy manual to all hourly employees severely undercuts the notion that Amoco intended to be bound by its contents. See, e.g. Kuta v. Joint Dist. No. *342 50(J), 799 P.2d 379 (Colo.1990) (limited distribution of handbook showed there was no implied contract); Lakeside v. Freightliner Corp., 612 F. Supp. 10 (D.Or.1984) (manual that was accessible to workers but that was distributed only to managers did not form an employment contract). Amoco did, however, distribute personal copies of its employee handbook to its employees as general guides to Amoco's policies. Yet, these handbooks did not contain the layoff/reduction-in-workforce policy at issue here. The omission of that specific policy should have alerted Stokes and Williams that Amoco was not promising them the protection of seniority in the event of a layoff. To show an offer of a company policy, more is required than has been shown here.
It is important to note that one of the cases underlying the decision in Pine River State Bank v. Mettille, 333 N.W.2d 622 (Minn.1983), the basis for our analysis in this area(see Hoffman-La Roche, Inc. v. Campbell, 512 So. 2d 725 (Ala.1987))specifically held that a personnel policy manual that was not distributed to employees could not become a part of the employment contract. See Cederstrand v. Lutheran Brotherhood, 263 Minn. 520, 117 N.W.2d 213 (1962). The Cederstrand court noted that the plaintiff was the employer's personnel director and was certainly aware of the contents of the manual, but it wrote:
Cederstrand, 263 Minn. at 534, 117 N.W.2d at 222. This analysis is especially analogous to our present case, considering the fact that Amoco did not disseminate the layoff policy and did not include it in the employee handbook.
In addition, the following disclaimer, printed in bold type and appearing in a separately outlined box at the beginning of the policy manual, clearly showed that Amoco did not intend to extend the policy manual as an offer for a unilateral contract:
This statement in the manual shows that today's main opinion is not one that follows the precedent of Hoffman-La Roche; it breaks the mold and creates an entirely new method for courts to expand their interference and regulation of legitimate businesses. When Alabama allowed employee handbooks to abrogate the at-will employment doctrine, in Hoffman-La Roche, this Court specifically stated: "[I]f the employer does not wish the policies contained in an employee handbook to be construed as an offer for a unilateral contract, he is free to so state in the handbook." 512 So. 2d at 734. This Court has repeatedly given effect to similar disclaimers. See Dykes v. Lane Trucking, Inc., 652 So. 2d 248 (Ala.1994); Abney v. Baptist Medical Centers, 597 So. 2d 682 (Ala.1992); Hanson v. New Technology, Inc., 594 So. 2d 96 (Ala. 1992); Clark v. America's First Credit Union, 585 So. 2d 1367 (Ala.1991); Stinson v. American Sterilizer Co., 570 So. 2d 618 (Ala. 1990).
The plaintiffs argue that this disclaimer should not be given effect because it was not directly communicated to them. However, the disclaimer was available to Amoco's employees on the same terms as the policies it disclaimed. It was prominently displayed in the manual and, if the employees had read it, it would have informed them that the policy manual was not intended as an offer of a unilateral contract. This displays the self-contradictory nature of the main opinion. Nondissemination of the policy obligates the employer, but publication of a disclaimer is ineffective. Such reasoning guts the ameliorative provision of Hoffman-La Roche that *343 seems to allow the employer to avoid having its manual interpreted as a contract.
Finally, I note that Stokes and Williams argue that the company's layoff policy had been communicated to them on numerous occasions before Stokes saw the policy in the human resources office. I cannot hold that they offered substantial evidence indicating that Amoco informed them of the specific layoff policy. Phillip Williams testified that he never saw the layoff policy until after his employment with Amoco had ended. The company had informed Williams of its general seniority policy, but not the layoff policy:
As Williams's testimony indicates, Amoco communicated to its employees its general seniority policy. However, I find no substantial evidence indicating that the specific layoff/reduction-in-workforce policy was orally communicated to Amoco employees by Amoco supervisors. Stokes's testimony further illustrates the lack of communication by Amoco regarding the specific layoff/reduction-in-workforce policy:
Stokes and Williams rely on these statements as evidence indicating that Amoco communicated the layoff policy to its employees. I find that, while these statements clearly show that Amoco communicated its general seniority policy that was to be followed in most employment decisions, they do not constitute substantial evidence from which one could find that Amoco made to the employees an offer of a unilateral contract.
Stokes and Williams presented evidence of only general statements of policy on Amoco's part, general statements that do not rise to the level of an offer for a unilateral contract. If these statements are held to constitute such an offer, then every company that has standard operating policies could be considered to have offered a unilateral contract to its employees. This evidence would not support a finding of an offer on Amoco's part; therefore, Stokes and Williams had no contract abrogating their at-will status. The trial court properly entered the summary judgment for the employer, and the Court of Civil Appeals erred in reversing it. Therefore, I respectfully dissent.
MADDOX, Justice (dissenting).
I must respectfully dissent. As a necessary step in reaching its conclusion, the majority relies upon this Court's decision in Hoffman-La Roche, Inc. v. Campbell, 512 So. 2d 725 (Ala.1987). I dissented in Hoffman-La Roche, because I did not believe that the provisions stated in a personnel handbook constituted a contract. I must dissent today based on the same reasons. In short, I do not believe Hoffman-La Roche was correctly decided; therefore, I do not believe this Court should continue to follow it.
*344 I hasten to point out that I am aware of the argument that the stare decisis doctrine weighs in favor of following Hoffman-La Roche. While I would agree in the abstract that the stare decisis doctrine must be accorded great deference, I would note that, as I wrote in my Hoffman-La Roche dissent, the stare decisis doctrine "should never be used to perpetuate error." 512 So. 2d at 752. In Hoffman-La Roche, the Court changed Alabama's employment-at-will doctrine and, therefore, usurped what I believe was rightfully the prerogative of the Legislature. I wrote then, and I still believe, "that the legislature is the appropriate body of government to address the policy considerations arising out of employer-employee relationships." Id.
Accordingly, I respectfully dissent.
[1] The "seniority" section of Amoco's employee handbook stated:
"After successful completion of the sixty-day probationary period, you begin to accrue three types of seniority, retroactive to your first day of work.
"1. Company SeniorityThis is the length of continuous service with Amoco Fabrics and Fibers Company. Company seniority will determine vacation pay, service awards, retirement benefits, and transfer right to a new plant.
"2. Departmental SeniorityLength of continuous service in a department of a specific plant. If you receive a transfer across departmental lines, you will retain your departmental seniority in the previous department six months.
"3. Job SeniorityLength of continuous service within a specific job classification. If you are promoted or transferred to another job classification, you will retain your job seniority in the previous job classification for six months."
[2] Stokes and Williams also alleged fraud; the trial court entered a summary judgment on that claim as well. However, Stokes and Williams did not appeal that aspect of the judgment.
[3] The Chief Justice's dissenting opinion states "that Amoco did not actively disseminate its layoff/reduction-in-workforce policy, as contained in its policy manual, but disclosed it only sporadically in response to employees' questions," and therefore, the dissent states, the policy was not an offer. 729 So. 2d at 341. However, that dissenting opinion does not mention the fact that the evidence suggested that Stokes and Williams's supervisors often communicated the policy to them. It also does not recognize that when Stokes and Williams began their employment, Amoco told them that all layoffs were done according to seniority. Finally, it fails even to acknowledge the most compelling evidence, i.e., that Amoco followed the layoff/reduction-in-workforce policy during Stokes and Williams's tenure, at least until it terminated them.
[4] The Chief Justice would give effect to this disclaimer, but his dissenting opinion ignores the fact that Amoco placed the disclaimer in the manual after the time at which Stokes and Williams could be found to have accepted Amoco's offer. | a80801e1561e001d3c6b4952dd85f55bd835e83da8f02e7507a5d8f748a598f3 | 1998-12-18 00:00:00 |
6802f621-4e63-47ac-82b5-e41986d040e5 | Ex Parte Keith | 771 So. 2d 1018 | 1970541 | Alabama | Alabama Supreme Court | 771 So. 2d 1018 (1998)
Ex parte S. Palmer KEITH.
In re S. Palmer Keith
v.
J.A. Moone and Sandra G. Moone et al.
1970541.
Supreme Court of Alabama.
November 6, 1998.
*1019 John N. Bolus and Carranza M. Pryor of Maynard, Cooper & Gale, P.C., Birmingham, for petitioner.
Andrew T. Mayfield, Clanton, for respondents.
LYONS, Justice.
S. Palmer Keith suffered a judgment by default in the Circuit Court of Chilton County. The Court of Civil Appeals dismissed as untimely his appeal from the trial court's denial of his postjudgment motions. Keith v. Moone, 771 So. 2d 1014 (Ala.Civ.App.1997). We reverse the judgment and remand for the Court of Civil Appeals to consider the appeal on the merits.
On July 2, 1996, the trial court entered an interlocutory default judgment against Keith and in favor of J.A. Moone and Sandra G. Moone, setting a hearing in August to determine damages. Before the date on which the hearing was set, Keith moved to set aside the default judgment. On August 16, 1996, the court denied Keith's motion to set aside the default *1020 judgment and entered a judgment awarding damages to the Moones. The judgment thus became final on August 16. See Maddox v. Hunt, 281 Ala. 335, 202 So. 2d 543 (1967) (once the trial court assesses damages on a default judgment, the judgment becomes final). Thirty-two days later, on September 17, 1996, Keith filed a "motion for rehearing" (hereinafter referred to as "the 1996 postjudgment motion"), in which he asserted that he had been incompetent at the time the default judgment was entered against him and in which he attacked the judgment as being void as a matter of law.
Several months later, the Moones filed what they entitled a "Motion to Finalize Judgment and Release Funds Held by Clerk." In their motion, they stated that Keith's 1996 postjudgment motion had been filed on September 12 [sic], 1996; that it had been denied on December 11, 1996, by operation of law, pursuant to Rule 59.1, Ala. R. Civ. P.; and that more than 42 days had passed since the motion had been denied. The Moones' assertion as to the timeliness of Keith's 1996 postjudgment motion apparently was founded on the erroneous assumption that the motion had been filed on the date stated in the certificate of service, which date preceded the expiration of the 30-day period in which a party can file a motion to set aside a default judgment. See Rule 55(c), Ala. R. Civ. P. In fact, the record reflects that Keith's motion was filed on September 17, several days after the date shown on the certificate of service, and, therefore, that it was untimely. Rule 55(c) requires that a motion to set aside a default judgment be filed, not merely served, within 30 days of the entry of the judgment. Cf. City of Talladega v. McRae, 375 So. 2d 429 (Ala.1979) (time for appeal not suspended when a Rule 59 motion was served, but not filed, within 30 days). On February 21, 1997, the trial court entered what it styled a "Final Order," in which it authorized the circuit clerk to release certain funds to the Moones and ordered that the case be closed. In that order, the trial court stated that the Moones' motion was "welltaken in that the time has elapsed for postjudgment motions and any appeals...."
Keith then filed a motion requesting the trial court to set aside its order of February 21 (hereinafter referred to as "the 1997 postjudgment motion"), again asserting that he had been incompetent and claiming that he had not received notice of the Moones' motion. Keith later amended the 1997 postjudgment motion to describe it as a motion "pursuant to Rule 60(b)[, Ala. R. Civ. P.]." Thereafter, on April 21, 1997, the trial court entered an order treating Keith's 1997 postjudgment motion as one made pursuant to Rule 60(b)(4) and denying it. Keith appealed from the "[d]enial of [the] Rule 60(b) motion, as amended." His appeal was filed within 42 days of the trial court's April 21 order. After the Court of Civil Appeals dismissed his appeal, we granted Keith's petition for certiorari review. See the opinion of the Court of Civil Appeals for a more detailed exposition of the course of proceedings.
The Court of Civil Appeals correctly determined that Keith's 1996 postjudgment motion, filed 32 days after the final judgment was entered on August 16, 1996, could not be deemed a timely Rule 55(c) motion to set aside a default judgment. Then, the court determined that Keith's 1996 postjudgment motion could be construed as a Rule 60(b)(4) motion for relief from the judgment. We agree that Keith's motion properly can be considered a Rule 60(b)(4) motion. Rule 55(c) provides that a court may not enter a default judgment against an incompetent person; Rule 60(b)(4) allows a party to seek relief from a void judgment. As a Rule 60(b)(4) motion, Keith's motion was timely filed. Rule 60(b) requires only that a motion made pursuant to subsection (4) be filed "within a reasonable time." The Court of Civil Appeals observed that such a motion does not extend or toll the time for an appeal from a final judgment. The court *1021 calculated the expiration of the time for appeal from the final judgment, and noted that Keith did not appeal within that time. Nevertheless, a party may appeal the denial of a Rule 60(b) motion, but the scope of appellate review is limited to the correctness of the denial of the Rule 60(b) motion, and not the correctness of the underlying judgment. Hilliard v. SouthTrust Bank of Alabama, N.A., 581 So. 2d 826 (Ala. 1991).
Treating Keith's 1996 postjudgment motion as a Rule 60(b)(4) motion, the Court of Civil Appeals observed that motions made pursuant to Rule 60(b) are not subject to the provisions of Rule 59.1, under which motions made pursuant to Rules 50, 52, 55, and 59 (but not Rule 60) are deemed denied by operation of law after they have been pending for 90 days. Hence, the court correctly concluded that Keith's motion remained pending on February 21, 1997, the date on which the trial court entered the order in which it erroneously recited that the time had elapsed for postjudgment motions and any appeals therefrom.
Although we agree with the Court of Civil Appeals' reasoning to this point, we disagree with its conclusion that the trial court's February 1997 order denied Keith's pending Rule 60(b)(4) motion. According to the Court of Civil Appeals, Keith argued that his "motion to set aside" filed on February 25, as later amended, should be construed as a "motion to reconsider" the trial court's denial of his Rule 60(b) motion. Relying on Ex parte Dowling, 477 So. 2d 400 (Ala.1985), the Court of Civil Appeals concluded that the trial court "could not reconsider the same post-trial motion," 771 So. 2d at 1018, and that Keith could not use a subsequent post-trial motion to extend the time for appeal. In Dowling, this Court stated that "[i]n the usual case, after a post-judgment motion has been denied, the only review of that denial is by appeal; a judge has no jurisdiction to `reconsider' the denial." 477 So. 2d at 404. The Court of Civil Appeals dismissed Keith's appeal because it was not filed within 42 days of either the August 1996 final judgment or the trial court's February 1997 order.
In his petition for a writ of certiorari, Keith argues that the Court of Civil Appeals' dismissal of his appeal conflicts with prior decisions of that court holding that a Rule 60(b) motion "can be subject to a posttrial motion to `reconsider' which would toll the time for appeal." Vaughan v. Vaughan, 539 So. 2d 1058, 1059 (Ala.Civ. App.1988), writ denied, Ex parte Vaughan, 539 So. 2d 1060 (Ala.1989). See also Cockrell v. World's Finest Chocolate Co., 349 So. 2d 1117 (Ala.1977); Alexander v. Washington, 707 So. 2d 254 (Ala.Civ.App.1997); Williams v. Curry, 455 So. 2d 43 (Ala.Civ. App.1984); Havel v. Dawkins, 412 So. 2d 800 (Ala.Civ.App.1982); Graham v. University Credit Union, 411 So. 2d 144 (Ala. Civ.App.1982).
The rule stated by this Court in Dowling arose in the context of postjudgment motions made pursuant to rules other than Rule 60. The Court of Civil Appeals noted that distinction in Vaughan, 539 So. 2d at 1059, but concluded that an appeal filed within 42 days of the denial of a "motion to reconsider" the denial of a Rule 60(b) motion was timely. In Ex parte Vaughan, even though this Court denied the petition for a writ of certiorari on other grounds, it expressly rejected that portion of the opinion of the Court of Civil Appeals finding the appeal timely:
539 So. 2d at 1060. We note that in Alexander, the Court of Civil Appeals relied on its decision in Vaughan v. Vaughan to find a similar appeal to have been timely. That *1022 decision overlooked our repudiation in Ex parte Vaughan of the court's rationale in Vaughan v. Vaughan.
We clarify the rule: After a trial court has denied a postjudgment motion pursuant to Rule 60(b), that court does not have jurisdiction to entertain a successive postjudgment motion to "reconsider" or otherwise review its order denying the Rule 60(b) motion, and such a successive postjudgment motion does not suspend the running of the time for filing a notice of appeal. We note, as the Court of Civil Appeals has done on several occasions, that the Alabama Rules of Civil Procedure do not contain any provision for a "motion to reconsider" a ruling on a Rule 60(b) motion. To the extent that Cockrell v. World's Finest Chocolate Co., Alexander v. Washington, Vaughan v. Vaughan, Williams v. Curry, Havel v. Dawkins, and Graham v. University Credit Union hold otherwise, they are hereby overruled.
Our clarification of the law regarding postjudgment motion practice does not, however, assist us in deciding whether Keith's appeal in this case was timely. Keith's notice of appeal was filed too late only if the trial court's February 1997 order can be construed as a denial of his 1996 postjudgment motion. The trial court's treatment of that pending motion in its February 1997 order is based on the previously noted inaccurate assumption that Rule 59.1 was applicable to the pending motion. The trial court, apparently relying on the Moones' erroneous assertions in their motion, deferred to what it thought had been a denial by operation of law of a timely Rule 55(c) motion. Because of that error, the trial court did not at that time deny or otherwise rule on the merits of the pending motion, which can be construed only as a Rule 60(b)(4) motion.
Because the trial court never ruled on Keith's Rule 60(b)(4) motion until the entry of the April 1997 order from which this appeal was taken, we deem the appeal to be timely. When the court entered its February 1997 order, Keith would have been entitled to petition for a writ of mandamus, but he did not then have a right to appeal from the trial court's erroneous conclusion that the motion had been denied by operation of law and that that denial had cut off the court's jurisdiction to act on the motion. The first, and only, time the trial court acted upon Keith's Rule 60(b)(4) motion was when it entered its April 1997 order, from which Keith appealed within 42 days. Keith is entitled to have that order reviewed on the merits.
We reverse the judgment of the Court of Civil Appeals and remand the cause for further proceedings consistent with this opinion.
REVERSED AND REMANDED.[*]
HOOPER, C.J., and ALMON, SHORES, HOUSTON, KENNEDY, COOK, and SEE, JJ., concur.
[*] Note from the reporter of decisions: On October 1, 1999, on remand from the Supreme court following certiorari review, the Court of Civil Appeals affirmed the judgment of the circuit court, without opinion. | 250b4556a785882ba32405cf1f425baf1b65b4ab5391bcc186d4d443b6736803 | 1998-11-06 00:00:00 |
b2126743-f413-4c0c-bfe8-8e6b881f9ed0 | Grimes v. Liberty Nat. Life Ins. Co. | 726 So. 2d 615 | 1971795 | Alabama | Alabama Supreme Court | 726 So. 2d 615 (1998)
Aura Mae GRIMES
v.
LIBERTY NATIONAL LIFE INSURANCE COMPANY.
1971795.
Supreme Court of Alabama.
November 20, 1998.
Glenda G. Cochran and John S. Campbell of Cochran & Associates, Birmingham, for appellant.
Jere F. White, Jr., J. Banks Sewell III, and William H. Brooks of Lightfoot, Franklin & White, L.L.C., Birmingham; James W. Gewin, Michael R. Pennington, and Matthew H. Lembke of Bradley, Arant, Rose & White, L.L.P., Birmingham; and Horace G. Williams and Courtney R. Potthoff of Williams, Potthoff & Williams, Eufaula, for appellee.
HOUSTON, Justice.
Aura Mae Grimes appeals from an order of the Circuit Court of Barbour County in which it exercised jurisdiction over matters raised in an action that she has pending in the Circuit Court of Jefferson County. We affirm.[1]
Ms. Grimes is a member of the non-opt-out plaintiff class of policyholders in Robertson v. Liberty National Life Ins. Co., No. CV-92-021, in which, in 1994, the Circuit Court of Barbour County entered a final judgment pursuant to a settlement agreement between the class members and the defendant Liberty National Life Insurance Company ("Liberty National"). The judgment provided in part:
(Emphasis original.)
Section III of the settlement agreement, which was incorporated into the judgment, contained the following release:
The final judgment entered in Robertson was affirmed by this Court. See Adams v. Robertson, 676 So. 2d 1265 (Ala.1995).
In 1997, Ms. Grimes filed an action, which is pending in the Circuit Court of Jefferson County (CV-97-70), in which she seeks compensatory and punitive damages based on allegations of the tort of outrage, fraud, breach of contract, and bad-faith refusal to pay an insurance claim. She filed this present appeal after the Circuit Court of Barbour County, at Liberty National's request, issued an order enforcing the injunction that it had issued in Robertson. Liberty National sought the order out of concern that Ms. Grimes was basing at least some of her claims on statements or representations alleged to have been made by Liberty National at the time it sold Ms. Grimes her cancer policy. Specifically, the Circuit Court of Barbour County noted in its order that the release that had been incorporated into the Robertson judgment covered "any frauds or other claims, including breach of contract, which arose out of transactions involving the cancer exchange program or statements or representations made by Liberty National or its agents pursuant to such a transaction." The court went on to state:
After carefully examining the record and the accompanying briefs, we conclude that the Circuit Court of Barbour County, pursuant to its continuing jurisdiction to oversee and administer the Robertson class action, had the authority to issue its order enforcing the 1994 injunction. In Ex parte Burch, 236 Ala. 662, 665-66, 184 So. 694, 697 (1938), this Court wrote:
See, also, Ex parte Liberty National Life Ins. Co., 631 So. 2d 865 (Ala.1993); Ex parte Moore, 382 So. 2d 548 (Ala.1980); Orton v. Cheatham, 293 Ala. 639, 309 So. 2d 94 (1975); Smith v. Charles E. Jay & Co., 292 Ala. 513, 296 So. 2d 885 (1974); Ex parte State ex rel. Ussery, 285 Ala. 279, 231 So. 2d 314 (1970); Rush v. Simpson, 373 So. 2d 1105 (Ala.Civ. App.1979), and the cases cited therein; Clements v. Barber, 49 Ala.App. 266, 270 So. 2d 815 (Ala.Civ.App.1972); Ex parte State Mutual Ins. Co., 715 So. 2d 207 (Ala.1997) (plurality decision recognizing, among other things, the power of a court entertaining a class action to enjoin a competing action filed after the class action); Amend. 328, § 6.04(b), Ala. Const.1901 ("[the circuit court] shall have authority to issue such writs as may be necessary or appropriate to effectuate its powers").
All of these decisions demonstrate the well-settled rule that where two courts have equal and concurrent jurisdiction, the court that first exercises jurisdiction in a matter has preference and is not to be obstructed in the legitimate exercise of its powers by a court of coordinate jurisdiction. The Circuit Court of Barbour County was acting well within its power in enforcing its permanent injunction so as to prevent Ms. Grimes from relitigating in another forum any claims against Liberty National that she, as a member of the Robertson class, had released in 1994.
AFFIRMED.
HOOPER, C.J., and MADDOX, ALMON, COOK, and SEE, JJ., concur.
KENNEDY, J., dissents.
SHORES and LYONS, JJ., recuse themselves.
[1] Ms. Grimes also filed in this Court a "Petition for Emergency Supervisory Injunction, for Writ of Prohibition, or for Writ of Mandamus," raising the same issues that she raises on this appeal. That petition, docketed as case No. 1971597, will be dismissed. | 93aa17b118136d927defc66082b4c516bf4e3b1dcca0c5b84822a336f423ad30 | 1998-11-20 00:00:00 |
ce59eb1c-3807-4b6d-963c-c84455e6d5d9 | Flemister v. General Motors Corp. | 723 So. 2d 25 | 1960603, 1960652 | Alabama | Alabama Supreme Court | 723 So. 2d 25 (1998)
Matthew William FLEMISTER, as administrator of the Estate of Sharon Ann Flemister, deceased
v.
GENERAL MOTORS CORPORATION.
General Motors Corporation
v.
Matthew William Flemister, as administrator of the Estate of Sharon Ann Flemister, deceased.
1960603, 1960652
Supreme Court of Alabama.
October 30, 1998.
R. Ben Hogan III and Benjamin E. Baker, Jr., of Hogan, Smith & Alspaugh, P.C., Birmingham, for appellant/cross appellee Matthew William Flemister.
Warren B. Lightfoot and Madeline H. Haikala of Lightfoot, Franklin & White, L.L.C., Birmingham; Stanley A. Cash of Huie, Fernambucq & Stewart, L.L.P., Birmingham; and David M. Heilbron and Leslie G. Landau of McCutchen, Doyle, Brown & Enersen, L.L.P., San Francisco, CA, for appellee/cross appellant General Motors Corp.
COOK, Justice.
Matthew William Flemister, as administrator of the estate of his mother, Sharon Ann Flemister, appeals from a judgment entered on a jury verdict in favor of General Motors ("GM") on Flemister's "crashworthiness" claim brought pursuant to the Alabama Extended Manufacturer's Liability Doctrine ("AEMLD"). GM cross-appealed, claiming the plaintiff presented insufficient evidence of proximate cause to allow the case to go to the jury.
Sharon Ann Flemister was the front-seat passenger in a 1988 Chevrolet Beretta automobile when it was struck by another car. The oncoming car hit the passenger door of the Beretta, and Mrs. Flemister was fatally injured.
*26 Before this accident occurred, GM had recalled certain 1988 Beretta automobiles to replace "single-hung" "straight-pin" door hinges with "double-hung" hinges. The Flemister vehicle was not part of the recall. GM presented evidence indicating that the recall was made to correct a "fatigue cracking problem" that was not present in the Flemister vehicle (which had single-hung "conical-pin" hinges) and that the reported instances of Beretta door problems were due to the fatigue-cracking problem. The plaintiff claimed that certain Beretta car doors had been shown to fall off, even in the absence of an impact, and that this fact indicated a defectively weak hinge.
GM admitted that a double-hung door hinge was stronger, but presented evidence indicating that the single-hung conical-pin hinge on the Flemister vehicle was not defective. GM witnesses testified that the single-hung hinge was originally used to accommodate assembly of the car, but that when the assembly process changed there was no longer a manufacturing reason for preferring the single-hung hinge.
According to the plaintiff's expert, double-hung hinges would have withstood the force of the collision involving the Flemister vehicle and would have converted the impact into a "sideswipe." However, evidence as to the angle of the impact ranged from 25° to 60°, and all of the experts testified that the angle of the impact was a significant factor in determining the force of the impact.
GM moved for a directed verdict at the close of the plaintiff's case and again at the close of all the evidence, arguing that the plaintiff had failed to prove proximate cause and that the evidence was insufficient for the case to go to the jury. The trial court denied the motions.
The trial court charged the jury on "crashworthiness" (based on Alabama Pattern Jury Instructions: Civil, Instruction No. 32.22) (2d ed.1993); on "negligent recall"; and on permissible damages. The plaintiff objected to the crashworthiness charge, specifically objecting to the language in Instruction 32.22 that refers to "consumer expectation," and GM objected to the negligent-recall instruction. The jury returned a verdict in favor of GM, and the trial court denied the plaintiff's motion for a new trial. The plaintiff appealed, and GM cross-appealed.
GM, in its cross-appeal, challenges the sufficiency of the evidence with regard to the issue of proximate causation. Our review of the record convinces us that the evidence was sufficient to create a genuine issue of material fact as to whether the alleged defect proximately caused Sharon Ann Flemister's death. Both parties submitted expert testimony regarding the design of the Beretta's door hinges, the history of hinge problems in other Beretta vehicles and the subsequent recall of those cars, the angle of the impact of the two vehicles, and the speed of the vehicles. The trial court correctly denied GM's motions for directed verdict and correctly allowed the case to go to the jury. See Cain v. Sheraton Perimeter Park South Hotel, 592 So. 2d 218 (Ala.1991), and the authorities cited therein.
The plaintiff raises one issue on appeal: Whether the trial court's "crashworthiness" jury charge required the jury to apply an erroneous standard of proof. APJI No. 32.22, "CrashworthinessGeneral Instructions As To Automobile Manufacturer Under AEMLD," is based upon this Court's discussion in General Motors Corp. v. Edwards, 482 So. 2d 1176 (Ala.1985). APJI No. 32.22 reads:
(Emphasis added.)
The plaintiff submitted a written requested charge that substantially mirrored APJI No. 32.22, but omitted the language regarding the "reasonable expectations of an ordinary consumer," claiming that the test for judging design defect under the AEMLD should be based exclusively on a risk/utility analysis, with no reference to consumer expectations. The plaintiff argues that a consumer cannot have expectations with regard to a crashworthiness design defect because only the manufacturer knows how safe a product can be made.
The plaintiff summarized, as follows, his contention that it was error to give APJI No. 32.22:
We conclude, however, that Alabama law, as expressed in Edwards, supra; in Volkswagen of America, Inc. v. Marinelli, 628 So. 2d 378 (Ala.1993); and in APJI No. 32.22, does not require a plaintiff alleging uncrashworthiness to prove more than that he expected that his automobile was not "unreasonably dangerous, that is, not fit for its intended purpose." "Consumer expectation," considered in the context of the entire text of APJI No. 32.22, is not the exclusive test by which a jury evaluates an alleged design defect. Rather, the term "consumer expectation," as it is used in APJI No. 32.22, states only one factor of a standard that acknowledges a consumer's reasonable expectations as to the intended purpose of the automobile; APJI No. 32.22 also requires proof of the attendant risk and utility of the automobile's design and of any available design alternatives, from which proof a jury could reasonably conclude that the automobile's design was defective.
APJI No. 32.22 requires a jury to determine, using a risk/utility balancing process, *28 whether a plaintiff alleging a lack of crashworthiness has shown that a safer, practical alternative design existed that would have eliminated or reduced the plaintiff's injuries if it had been used. This method of analysis applies whether or not the plaintiff was aware of, or had formed an expectation with regard to, the effect of the alleged defect; it involves a balancing of the factors shown to exist with regard to the product's utility as against the risks posed by the use of the product.
We acknowledge the plaintiff's excellent discussion of the authorities criticizing the use of consumer expectation as an element of design defectiveness in products-liability cases, as well as a trend in other jurisdictions to adopt a pure risk/utility analysis as the standard by which to judge an alleged design defect.[1] However, whether our law for crashworthiness cases will be better served by maintaining the present "mixed" analysis or by adopting a risk/utility analysis is not an appropriate consideration under the facts of this case.
Because the jury's verdict is presumed to be correct, "[o]n appeal from [the] trial court's denial of a motion for new trial, this Court must affirm unless the jury verdict is so contrary to the weight and sufficiency of the evidence, viewed most favorably to [GM], that it is palpably wrong or manifestly unjust." Lemond Constr. Co. v. Wheeler, 669 So. 2d 855, 862 (Ala.1995). Our review of the record leads us to conclude that GM presented evidence from which the jury could reasonably conclude that the Flemister vehicle was not defective, that is, that there was not a safer alternative design for the Flemister vehicle.
GM's recall of certain Beretta vehicles did not include the Flemister vehicle; the "fatigue cracking" problem of certain hinges was not related to the Flemister car; and no evidence indicated that the hinge on the Flemister car was defective. Although there was evidence that a different hinge may have made a difference in a "sideswipe" accident involving the Flemister car, the jury could infer from the expert testimony that the nature of the collision involving the Flemister vehicle was such that a different hinge would have made no difference, given the angle of the impact of the two cars.
APJI No. 32.22 ultimately requires, in resolving the issue of an alleged design defect, a balancing of the risk of harm to the consumer against the utility of the product's design. The trial court's charge to the jury fairly and substantially emphasized the risk/utility balancing as the basis for analyzing the alleged design defect. See Marinelli, supra. We therefore can not conclude that the jury was misled by the trial court's charge.
The judgment is affirmed, both as to the appeal and as to the cross-appeal.
1960603AFFIRMED.
1960652AFFIRMED.
HOOPER, C.J., and MADDOX, SHORES, HOUSTON, KENNEDY, and LYONS, JJ., concur.
ALMON and SEE, JJ., concur in the result.
[1] R.B. Hogan III, The Crashworthiness Doctrine, 18 Am. J. Tr. Advoc. 37 (1994); R.B. Hogan III, Risk/Utility or Consumer Expectation: What Should Be Alabama's Analysis for Products Liability Design Cases? 56 Ala. Law. 166 (1995); John F. Vargo, The Emperor's New Clothes: The American Law Institute Adorns A "New Cloth "for Section 402A Products Liability Design Defects A Survey of the States Reveals A Different Weave, 26 U. Mem. L.Rev. 493 (1996); John Wade, On The Nature Of Strict Tort Liability For Products, 44 Miss. L.J. 825 (1973); John Wade, On Product "Design Defects "And Their Actionability, 33 Vand. L.Rev. 551 (1980); Note, Strict Products Liability And The Risk/Utility Test For Design Defects: An Economic Analysis, 84 Colum. L. Rev. 2045 (1984); Note, The Consumer Expectation Test In New Jersey: What Can Consumers Expect Now? 54 Brook. L.Rev. 1381 (1989); 2A Louis Frumer and Melvin I. Friedman, Products Liability § 2.16[3] (1994). | d0a1d6af8442d739e17c30f6f8e9bd925dd7dd457b28e8614d5b5f2870977a27 | 1998-10-30 00:00:00 |
9197d7ce-610f-4cd5-bc23-500f339410e3 | Ex Parte Union Security Life Ins. Co. | 723 So. 2d 34 | 1971487 | Alabama | Alabama Supreme Court | 723 So. 2d 34 (1998)
Ex parte UNION SECURITY LIFE INSURANCE COMPANY.
(Re Dessie Lanier
v.
Union Security Life Insurance Company et al.).
1971487.
Supreme Court of Alabama.
October 30, 1998.
*35 Dennis G. Pantazis and Brian M. Clark of Gordon, Silberman, Wiggins & Childs, P.C., Birmingham, for petitioner.
Christopher E. Connolly of O'Bannon & O'Bannon, L.L.C., Florence, for respondent.
COOK, Justice.
Union Security Life Insurance Company ("Union Security"), the defendant in an action pending in the Lauderdale Circuit Court, petitions this Court for a writ of mandamus directing the circuit court to vacate its orders compelling Union Security to produce documents in response to three of the plaintiff's requests for production. We grant the petition in part and issue the writ.
In August 1996, Dan Turner, a salesman for Dan Jones Ford, Inc., sold a Ford pickup truck to the plaintiff, Dessie Lanier, and her husband, Billy Lanier. In connection with the truck purchase, the Laniers purchased a Union Security credit life insurance policy insuring Billy Lanier. Dessie Lanier claimed that she and her husband told the Dan Jones Ford employees that Billy Lanier was receiving disability benefits at that time, and she *36 claimed that the Dan Jones Ford employees knew that Billy Lanier had cancer but that neither she nor her husband was asked any "health questions" when they closed on the purchase of the truck and were issued the Union Security insurance policy.
Billy Lanier died in March 1997. Dessie Lanier submitted a claim for benefits pursuant to the provisions of the credit life insurance policy purchased with the truck. Union Security denied the claim, on the basis that Billy Lanier had failed to disclose that he had cancer at the time the policy application was completed.
Dessie Lanier sued Union Security and Dan Jones Ford, Inc., alleging fraud, breach of contract, negligence, wantonness, and bad-faith refusal to pay insurance benefits, and seeking compensatory and punitive damages. Ms. Lanier's second filing requesting the production of documents asked Union Security to produce:
Union Security's responses and objections to these three requests for production read:
(Emphasis added.)
Ms. Lanier moved to compel further responses. The trial court conducted a hearing on the motion and, on March 26, 1998, entered an order limiting the scope of discovery with regard to production of the documents listed in requests 1, 5, and 6, as follows:
(Emphasis added.)
Union Security, seeking further limitations on discovery as to requests 1, 5, and 6, moved the trial court to alter, amend, or vacate its order. On May 15, 1998, the trial court denied the motion and gave Union Security 10 days within which to comply with the March 26 order.
Union Security petitioned this Court for a writ of mandamus directing the trial court to vacate the order compelling production of the documents described in requests 1, 5, and 6. Union Security also moved for a stay of the operation of the trial court's orders of March 26 and May 15 pending the outcome of its mandamus petition. We granted the motion to stay.
A challenge to a trial court's ruling on a discovery matter attacks the court's exercise of its broad discretion, and a petition for the writ of mandamus is the correct means for seeking appellate review of a discovery ruling. Ex parte Compass Bank, 686 So. 2d 1135 (Ala.1996). However, because mandamus is a drastic remedy, and because the trial court is in a better position than this Court to rule on discovery matters, which are decided on a case-by-case analysis of facts and circumstances (Ex parte Mobile Fixture & Equipment Co., 630 So. 2d 358, 360 (Ala. 1993), quoting Ex parte McTier, 414 So. 2d 460, 461 (Ala.1982)), we will not interfere with a trial court's ruling on a discovery matter unless that ruling is the result of clear abuse by the trial court (Ex parte Horton, 711 So. 2d 979 (Ala. 1998), and the authorities cited therein).
To determine whether the trial court abused its discretion in ordering Union Security to comply with Ms. Lanier's requests 1, 5, and 6, we must consider the nature of her claim and whether, in light of that claim, she demonstrated a particularized need for the discovery she seeks. Ex parte Horton, supra. If the record reflects the requisite need for discovery, then we must determine whether the trial court's order reflects an appropriate balance between meeting Ms. Lanier's discovery needs and protecting the legitimate confidentiality interests of Union Security and its customers. Id.
Clearly, the nature of Ms. Lanier's claims supports a finding of a need for broad discovery. The complaint alleges fraud, misrepresentation, and deceit, and resulting damage.
Ex parte Horton, 711 So. 2d at 983 (some citations omitted).
Ms. Lanier's complaint reveals a particularized need for discovering evidence supporting allegations of fraud, including evidence of a pattern and practice of fraud on the part of the defendants similar to the fraud she alleges was committed by the defendants upon her and her husband. However, even in a fraud case, discovery is not unlimited (Ex parte Horton, supra), and "justice requires the trial court to protect a party from oppression or undue burden or expense." Ex parte Compass Bank, 686 So. 2d at 1138.
With regard to request number 1as to which the court ordered production of all applications for Union Security credit life insurance received from Alabama residents for the period 1993 through 1997Union Security contends that Ms. Lanier's claim is that an employee of Dan Jones Ford knew her husband had cancer but did not ask the requisite health questions before filling out a Union Security application for life insurance on Billy Lanier. Therefore, Union Security argues, the conduct of Dan Jones Ford employees is the basis for Ms. Lanier's allegation of systematic fraud and information contained in Union Security documents cannot establish a pattern and practice of fraud in oral representations made by Dan Jones Ford employees.
The trial court did not abuse its discretion in ordering Union Security to comply with request number 1, as modified by the March 26 order. Dan Jones Ford's answer to the complaint contained a cross-claim against Union Security in which Dan Jones Ford alleged:
The pattern and practice of fraud alleged by Ms. Lanier is ultimately reflected in applications for Union Security credit life insurance, and these documents are the result of the efforts of agents, such as Dan Jones Ford, acting on behalf of Union Security. Clearly, then, in light of the authorities discussed above and under the circumstances of this case, the discovery of applications for Union Security credit life insurance made by Alabama residents within a five-year period could produce evidence relevant to Ms. Lanier's claims, and the process of producing these documents will not be burdensome to Union Security.
With regard to request number 5as to which the court ordered production of all consumer complaints from Alabama regarding Union Security credit life insurance policies for the period 1993 through 1997Union Security argues that this is a "fishing expedition" for documents relating to acts of Union Security that may have generated customer complaints (e.g., allegations of miscalculation of premiums, improper debt-collection practices, improper assessment of fees and charges), but that are unrelated to the issues raised by Ms. Lanier's complaint.
We do not conclude that the discovery of a limited type of communication between Alabama residents and Union Security over a five-year period can be classified as a "fishing expedition" under the facts of this case. Customer complaints filed directly with Union Security may not have resulted in the institution of legal actions; clearly, however, the discovery of these direct complaints can lead to evidence of representations similar to *39 those made to the Laniers that were made to others by agents of Union Security and that resulted in the issuance of credit life insurance policies against which claims were made and payment was refused.
Ms. Lanier must carry a heavy burden of proof with regard to her claims that Union Security has engaged in a pattern and practice of fraud in 1) issuing life insurance policies that are based on improperly completed applications but that contain a provision allowing Union Security to investigate the insured's health after a claim has been filed against the policy, 2) accepting the premiums therefor, and 3) denying coverage based on allegedly unreported preexisting medical conditions. Requests 1 and 5 could produce relevant and necessary information regarding applications for Union Security credit life insurance and complaints that have been made with regard to the policies issued as a result of those applications. Producing this information will not place an undue burden on Union Security and will not compromise Union Security's confidentiality interest. "When the discovery request of a plaintiff alleging fraud is closely tailored to the nature of the fraud alleged, the discovery should be allowed in full, as long as the party opposing discovery does not show that the requested discovery is oppressive or overly burdensome." Ex parte Horton, 711 So. 2d at 983.[1]
Further, Ms. Lanier claims punitive damages. Regarding such a claim, we have written:
Id., at 983-84.
The trial court did not abuse its discretion in ordering Union Security to comply with requests 1 and 5, as limited by the trial court's order. See, also, Ex parte Wal-Mart Stores, Inc., 682 So. 2d 65 (Ala. 1996).
Union Security contends that by ordering it to comply with request number 6, as limited by the trial court's ordercalling for production of all documents in all lawsuits filed against Union Security during the period 1993 through 1997 in Alabama, Georgia, Florida, Mississippi, Louisiana, Tennessee, and Kentucky involving credit life insurancethe trial court clearly abused its discretion in defining an arbitrary geographical "Southeast" that has no relevance to Ms. Lanier's allegations.
In Ex parte State Farm Mutual Automobile Insurance Co., 452 So. 2d 861 (Ala.1984), State Farm petitioned for a writ of mandamus, challenging the trial court's discovery order requiring State Farm to answer the following interrogatory:
Id., 452 So. 2d at 863-64.
In this present case, the trial court's order encompassed what it defined as the "Southeast," but our review of the record reveals no basis for this geographical requirement. If Union Security has engaged in the fraudulent practice alleged by Dessie Lanier, then the records relating to Union Security's activities in Alabama during the five-year period set out in request number 6 "should establish that fact." Requiring Union Security to produce records from the seven-state area defined in the March 26 order amounted to an unreasonable exercise of discretion by the trial court, and Union Security is entitled to a writ of mandamus ordering the trial court to vacate that portion of its order and to amend the order to conform with this opinion.
In her brief in opposition to Union Security's mandamus petition, Ms. Lanier argues that, pursuant to this Court's decision in Ex parte Reynolds Metals Co., 710 So. 2d 897 (Ala. 1998), the petition should be dismissed as premature. According to her, Rule 26(c), Ala. R. Civ. P., required Union Security to seek a protective order from the trial court before filing a mandamus petition with this Court, and its failure to do so rendered the petition premature.
In Reynolds Metals, the plaintiff filed a motion to compel Reynolds Metals to respond to discovery requests, which motion Reynolds Metals opposed. At the hearing on the plaintiff's motion to compel, the trial court ordered Reynolds Metals to respond to the plaintiff's discovery requests within 21 days. Reynolds Metals did not object to the trial court's order or move for a protective order; however, before the expiration of the 21 days it had been given to file its responses to the plaintiff's discovery requests, Reynolds Metals filed a mandamus petition with this Court, claiming that the discovery order was overly broad and unduly burdensome.
This Court pointed out that a party's entitlement to the writ of mandamus is based, in part, on showing the "lack of another adequate remedy." Holding that Reynolds Metals did have another adequate remedy, we stated:
Ex parte Reynolds Metals, 710 So. 2d at 899-900 (citations omitted and emphasis added).
Union Security, however, filed a post-hearing motion with the trial court, asking that it alter, amend, or vacate its discovery order; thus it "afford[ed] the trial court the opportunity to address its alleged error before [Union Security sought] mandamus relief." See, also, Ex parte Compass Bank, supra. Thus, Union Security's petition for the writ of mandamus was not premature.
As to requests 1 and 5, the petition is denied. As to request number 6, the trial court is directed to set aside that portion of its order compelling disclosure as to the "Southeast United States" and to limit the required disclosure to conform with this opinion; otherwise, as to request number 6, the petition is denied.
PETITION GRANTED IN PART AND DENIED IN PART.
HOOPER, C.J., and MADDOX, ALMON, SHORES, HOUSTON, and KENNEDY, JJ., concur.
[1] Union Security submitted the affidavit of its paralegal, in which she stated that collecting the information requested by Ms. Lanier would "take considerable man-hours, time, effort, and expense." This affidavit contains no specific statement of numbers (of files or hours); it is a general statement of inconvenience and does not provide a sufficient basis for finding that requests 1 and 5 are oppressive or burdensome.
With regard to request number 6, the paralegal stated that the files were stored "in an offsite facility" and that "once the actual files were located, I would then have to individually review each file to determine which documents should be produced." | 3ffa58d0560141f8e7c01f5233dbd974f333eec880a446340e0c7be928ba33ce | 1998-10-30 00:00:00 |
ade4f627-e5b9-467b-82e7-3fb5c9f644b5 | Tom Williams Motors, Inc. v. Thompson | 726 So. 2d 607 | 1970348 | Alabama | Alabama Supreme Court | 726 So. 2d 607 (1998)
TOM WILLIAMS MOTORS, INC., d/b/a Tom Williams BMW-Porsche-Audi
v.
Larry THOMPSON.
1970348.
Supreme Court of Alabama.
September 25, 1998.
Rehearing Denied December 4, 1998.
James A. Kee, Jr., Larry S. Logsdon, and Michael L. Jackson, of Wallace, Jordan, Ratliff & Brandt, L.L.C., Birmingham, for appellant.
Clay Hornsby of Morris, Haynes, Ingram & Hornsby, Alexander City, for appellee.
COOK, Justice.
AFFIRMED. NO OPINION.
See Rule 53(a)(1) and (a)(2)(F), Ala. R.App. P., and Ex parte Dickinson, 711 So. 2d 984 (Ala.1998.)
ALMON, SHORES, and KENNEDY, JJ., concur.
HOUSTON, J., concurs specially.
LYONS, J., concurs in the result.
HOOPER, C.J., and MADDOX and SEE, JJ., dissent.
HOUSTON, Justice (concurring specially).
I write specially to explain why I have changed from the opinion I expressed when I dissented in Ex parte Dickinson, 711 So. 2d 984 (Ala.1998).
Dickinson is now the law, and I am not too sure that I was right in dissenting in Dickinson. Here, as in Dickinson, a signatory to an arbitration agreement is trying to compel a nonsignatory to arbitrate. I agree that a signatory should be estopped from avoiding arbitration with a nonsignatory, when the issues the nonsignatory is seeking to resolve in arbitration are intertwined with the agreement the signatory party has signed. McBro Planning & Dev. Co. v. Triangle Elect. Constr. Co., 741 F.2d 342 (11th Cir.1984); Thomson-CSF, S.A. v. American Arbitration Ass'n, 64 F.3d 773 (2d Cir.1995). I am not now convinced that a nonsignatory should be so estopped.
LYONS, Justice (concurring in the result).
Two joint purchasers claim damages because, they say, they were fraudulently induced *608 into entering into a transaction that is undisputedly evidenced, at least in part, by a written instrument (the "buyer's order") containing an arbitration clause signed by one of the two purchasers. The claims of the nonsignatory plaintiff, Larry Thompson, are grounded in tort only. In his effort to avoid arbitration, Larry Thompson says he suffered no loss by entering into the buyer's order.
Where the plaintiff disavows his status as a party to a contract in an effort to avoid arbitration, the court does not err in requiring the plaintiff to arbitrate the abandoned claim of fraud in the inducement. Ex parte Warren, 718 So. 2d 45 (Ala.1998). Here, the nonsignatory plaintiff maintains that he has actionable claims for fraud in the inducement arising from contractual relations independent of the buyer's order containing the arbitration clause that he did not sign and from which he claims no loss. I am unwilling to force Larry Thompson into arbitration on a theory of intertwining of contracts containing arbitration clauses and contracts without arbitration clauses[1] where he did not sign any contract with an arbitration clause and where, by conceding that he has suffered no loss by entering into the buyer's order, he has cut the twine that might otherwise bind the agreements together. It will be for the trial court, on remand, to determine whether he has a viable cause of action independent of the buyer's order.
MADDOX, Justice (dissenting).
This arbitration case arises out of Larry Thompson and Joana Thompson's purchase of an automobile from Tom Williams Motors, Inc., d/b/a Tom Williams BMW-Porsche-Audi ("Tom Williams"). The Thompsons sued Tom Williams, alleging that Tom Williams had committed fraudulent misrepresentation of material facts, suppression of material facts, deceit, and fraudulent deceit in connection with the sale of the automobile. Tom Williams moved to stay the proceeding and to compel arbitration. The trial court compelled arbitration as to Joana's claims, but refused to compel arbitration of Larry's claims, on the grounds that Larry did not sign the buyer's order that contained the arbitration clause. Tom Williams appeals the trial court's order denying arbitration of Larry's claims; Joana has not appealed the trial court's order compelling arbitration of her claims. The Court affirms. I must respectfully disagree, as I did in Ex parte Dickinson, 711 So. 2d 984, 991 (Ala.1998), a case involving similar facts, on the ground that Larry's tort claims are "intimately founded in and intertwined with the underlying contract obligations." Further, I would hold that, based on the facts of this case, each of Larry's claims constitutes "a controversy thereafter arising out of such contract or transaction," within the meaning of those words in the Federal Arbitration Act. 9 U.S.C. § 2. There is no reason why one of the claims should be arbitrated and the other should proceed to trial.
In September 1996, Larry and his daughter Joana visited Tom Williams to purchase an automobile for Joana. Ultimately, they purchased a 1993 BMW 325is automobile, with Larry writing a check, using funds he had borrowed. Title was issued jointly in the names of "Thompson Larry R[.] or Joana."
As part of the purchase agreement, a buyer's order form was prepared. The buyer's order listed both Larry Thompson and Joana Thompson as purchasers and contained an arbitration clause providing that "[b]uyer/lessor and dealer agree that all claims, demands, disputes, or controversies of every kind or nature that may arise between them concerning any of the negotiations leading to the sale or lease of the vehicle, terms and provisions of the sale or lease agreement ... or any other aspects of the vehicle and its sale or lease shall be settled by binding *609 arbitration." Joana Thompson signed the buyer's order; Larry Thompson did not.
In May 1997, both Larry and Joana filed this action, alleging, among other things, that Tom Williams had misrepresented, suppressed, and concealed material facts about the automobile the Thompsons purchased from Tom Williams and that they had agreed to purchase the automobile as a result of the alleged misrepresentation, suppression, and concealment. Tom Williams moved in July 1997 to compel arbitration. After a hearing, the trial court granted Tom Williams's motion to compel arbitration as to Joana's claims, but denied the motion to compel arbitration as to Larry's claims.
Tom Williams argues that Larry's claims are subject to the arbitration agreement signed by Joana because, it says, his claims are based on the same documents and transaction as Joana's claims. Larry's sole argument is that he cannot be compelled to arbitrate his claims because he did not sign the arbitration agreement that appeared in the buyer's order.
The Federal Arbitration Act provides, in pertinent part:
9 U.S.C. § 2. In addition to showing that the agreement in question appears in a contract involving interstate commerce, a party seeking a stay of proceedings pending arbitration must show: (1) that a valid written arbitration agreement exists; (2) that the issues in the action are referable to arbitration under the agreement; and (3) that the party is not in default in seeking arbitration. See 9 U.S.C. §§ 2-3; Allied-Bruce Terminix Companies, Inc. v. Dobson, 513 U.S. 265, 115 S. Ct. 834, 130 L. Ed. 2d 753 (1995).
It is undisputed that the contract in this case evidences "a transaction involving [interstate] commerce"; this claim, therefore, is governed by the Federal Arbitration Act, 9 U.S.C. § 1 et seq. It is also undisputed that Tom Williams is not in default in seeking arbitration. In addition, for purposes of this appeal, it is undisputed that the arbitration agreement itself was valid with regard to Joana's claims and that the fraud claims being asserted are encompassed by the arbitration clause. Therefore, the critical question presented is whether Larry, who did not sign the buyer's order containing the arbitration agreement, is nevertheless bound by the terms of that arbitration agreement.
The United States Supreme Court has recognized a strong federal policy in favor of arbitration, and, therefore, any doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration. See Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24, 103 S. Ct. 927, 74 L. Ed. 2d 765 (1983). Pursuant to this policy, as I have written before:
Ex parte Jones, 686 So. 2d 1166, 1169-70 (Ala.1996) (Maddox, J., dissenting). Under the equitable estoppel theory discussed in the cases I cited in Ex parte Jones, claims involving a nonsignatory are subject to arbitration if the nonsignatory directly benefited from the contract containing the arbitration clause or if the nonsignatory's claims are *610 "intimately founded in and intertwined with the underlying contract obligations." McBro Planning & Dev. Co. v. Triangle Elec. Constr. Co., 741 F.2d 342, 344 (11th Cir.1984).
Applying this "close relationship" test to the facts of this case, I find it clear that Larry's claims are not distinct from Joana's claims, because both assert claims directly based on the sale of the automobile and on negotiations leading to that sale. It is clear from the record that Larry and Joana allege that they agreed to purchase the automobile from Tom Williams as a result of misrepresentations made by Tom Williams about the automobile. Implicit in this allegation is a recognition that both Larry and Joana were "purchasers" of the automobile. In fact, without Larry's involvement in the purchase transaction arising from the buyer's order containing the arbitration clause, he would not have standing to bring a claim against Tom Williams. Cf. A.L. Williams & Associates, Inc. v. McMahon, 697 F. Supp. 488 (N.D.Ga.1988). In the A.L. Williams case, an insurance agent's wife sued her husband's employer, based on contractual agreements that had been signed only by her husband and his employer. The wife asserted that the arbitration clauses in the contracts on which her claims were based did not apply to her because she had not signed the contracts. Id. at 493-94. The United States district court rejected this argument, stating:
Id. at 494. Accord Foster v. Sears, Roebuck & Co., 837 F. Supp. 1006 (W.D.Mo.1993) (holding that a nonsignatory husband was bound to arbitrate claims arising out of purchase documents signed by wife). In this case, the trial court has not ruled on the standing issue, and the mandamus petition to this Court does not seek relief (i.e., dismissal) based on a question of standing. Instead, this matter concerns the arbitrability of the father's claims, and the arbitrator is fully capable of determining the standing of the father to bring those claims.
There could be no clearer case for the application of the doctrine of equitable estoppel than this one. It is undisputed that both Larry and Joana played an active role in the purchase of this automobile. Both Larry and Joana are listed as purchasers of the automobile on the buyer's order form containing the arbitration clause, and the title was issued jointly to Larry and Joana. Larry obtained the financing necessary to purchase the automobile and actually wrote the check paying for it. These facts clearly show that Larry's claims are so "intimately founded in and intertwined with the underlying contract obligations" as to make him subject to the arbitration agreement contained in the buyer's order. See McBro, 741 F.2d at 344; Sunkist, 10 F.3d at 757.
I realize that this Court, in Dickinson, supra, held, in part, that a nonsignatory wife was not required to arbitrate her claims, even though she had jointly purchased an automobile with her husband, who had signed an arbitration agreement as part of the automobile purchase transaction. I dissented in that case, and the reasons for my dissent were essentially the same as those I express here.
In Dickinson, the Court relied on Thomson-CSF, 64 F.3d at 776, to prevent a signatory party from invoking the estoppel rule to require a nonsignatory to arbitrate her claims. In that case, Thomson-CSF, S.A. ("Thomson"), purchased a subsidiary corporation after the subsidiary had entered into a supply agreement requiring it to purchase certain items from a certain supplier. The supplier later filed claims against the subsidiary and successfully sought to require the subsidiary to arbitrate those claims pursuant to an arbitration clause in the supply contract. Id. The supplier also filed claims against Thomson, arguing that Thomson had purchased the subsidiary in order to eliminate the subsidiary as a competitor, and that *611 the elimination of Thomson's competitor had damaged the supplier's business. Id. When the supply contract was executed, Thomson had no relation to the corporation that ultimately became its subsidiary, or to the supply agreement itself. Id. Thus, the United States Court of Appeals for the Second Circuit held that the supplier, a signatory party, could not invoke the estoppel rule to retroactively bind Thomson, a nonsignatory party, to arbitrate the supplier's claims against it. The Second Circuit based its conclusion on two factors: (1) the fact that Thomson was not a direct beneficiary of the supply contract; and (2) the fact that the supplier's claim against Thomsonpredatory purchase of a competitorwas not integrally related to the supply contract that contained the arbitration clause. Id. at 779-80.
Generally, of course, the estoppel rule is invoked by a nonsignatory party to require a signatory party to arbitrate claims arising from the contract signed by the signatory party. See, e.g., McBro, supra.
Unlike the nonsignatory in Thomson, Larry, the nonsignatory in this case, was extensively involved in the transaction when the purchase documents, including the arbitration agreement, were negotiated. Unlike the subsidiary in Thomson, Larry's daughter Joana executed the purchase documents, including the arbitration agreement, on behalf of her father and herself in a transaction that conferred direct benefits on both of them. In addition to the gratuitous benefit gained by providing his daughter with an automobile, Larry directly received benefits from the buyer's order signed by Joana in that the automobile served as collateral to secure repayment of the loan that he made to purchase the car. Because Larry directly benefited from the buyer's order containing the arbitration clause signed by Joana, Thomson would hold that Larry is estopped from avoiding arbitration. See Thomson, 64 F.3d at 779 ("Had Thomson directly [benefited] from the [contract containing the arbitration clause signed by its subsidiary] ... it would be estopped from avoiding arbitration.") (Emphasis added.) Moreover, Larry's claims are integrally related to the purchase documents, including the arbitration agreement. See Thomson, id. at 779-80. Thus, unlike the signatory seeking arbitration in the Thomson case, the signatory seeking arbitration in this case (Tom Williams) may properly invoke the estoppel rule to compel the nonsignatory (Larry) to arbitrate his claims. Accordingly, Thomson, properly analyzed, does not support the Court's rationale in this case or in the Dickinson case, where the nonsignatory wife clearly benefited from the purchase of the automobile.
I do not believe that a buyer such as Larry can have it both ways. That is, he cannot argue that he has the capacity to sue, on the ground that he was misled into entering a contract to purchase the automobile, and then disavow an arbitration clause in a document that lists him as a purchaser. Either he was a purchaser of the automobile or he was not. Larry should not be allowed to claim on the one hand that he is a purchaser and then, on the other, not be bound by the arbitration clause in the contract that evidences that fact. See A.L. Williams & Associates, 697 F. Supp. at 494.
Based on the foregoing, I consider it obvious that the Court should hold Larry bound by the arbitration clause contained in the buyer's order that gives him the capacity to sue.
HOOPER, C.J., and SEE, J., concur.
[1] Ex parte Dickinson, 711 So. 2d 984, 989 (Ala. 1998), following Thomson-CSF, S.A. v. American Arbitration Ass'n, 64 F.3d 773 (2d Cir.1995). From the Dickinson opinion, it does not appear that the nonsignatory in that case affirmatively disavowed any benefit from the agreement containing the arbitration clause. Assuming that to be the case, I believe that if the nonsignatory, during the judicial proceedings on remand, invokes any provision of the agreement containing the arbitration clause, her rights would then become subject to arbitration if the defendant then renewed its demand. | 69eb92ad21c60d3e2301405e451bab95e078ad0d9429332948f8cb9de5b9d9d9 | 1998-09-25 00:00:00 |
42be8bf7-f30c-4a8e-a168-6d2eb1b83a53 | Equity Resources Management, Inc. v. Vinson | 723 So. 2d 634 | 1970217 | Alabama | Alabama Supreme Court | 723 So. 2d 634 (1998)
EQUITY RESOURCES MANAGEMENT, INC., et al.
v.
Linda VINSON.
1970217.
Supreme Court of Alabama.
November 13, 1998.
*635 Susan S. Wagner, Frank S. James III, and Wesley C. Redmond of Berkowitz, Lefkovits, Isom & Kushner, P.C., Birmingham, for appellants.
Jimmy Jacobs, Montgomery, for appellee.
HOUSTON, Justice.
Pursuant to Rule 5, A.R.App.P., this Court granted permission to Equity Resources Management, Inc. ("Equity Resources"), Paul Spina, Jack Fiorella, and Carol Bohn,[1] to appeal the trial court's denial of their motion for a summary judgment in this action filed against them by Linda L. Vinson. The summary judgment motion was based on the defense of res judicata, the elements of which were stated in that motion as "(1) a prior judgment on the merits, (2) rendered by a court of competent jurisdiction, (3) with substantial identity of the parties, and (4) with the same cause of action presented in both suits."[2]
Before she filed this action in August 1996, Vinson had filed an action against these same defendants in the United States District Court for the Middle District of Alabama, Northern Division (Vinson v. Equity Resources Management, Inc., et al., CA-95-T-1649-N, "the federal action"), seeking damages for, among other things, age discrimination, under the Age Discrimination in Employment Act of 1967, 29 U.S.C. § 621 et seq. In the federal action, she had sought damages for:
In connection with three of her claims now before this Court (those claims alleging fraud, breach of contract, and negligence or wantonness in the hiring, training, supervision, and retention of her immediate supervisor, Bohn), Vinson seeks damages for:
Vinson also seeks punitive damages in connection with her claims alleging fraud and wanton hiring, as well as in connection with her claim alleging a "violation of [her] rights to equal protection and due process of law under Article One §§ 6 and 13 of the Constitution of Alabama of 1901."
The federal district court dismissed Fiorella, Spina, and Bohn as defendants on the ground that as to them Vinson had failed to state a claim upon which relief could be granted. The federal claim against Equity Resources was then tried to a jury, which awarded Vinson $86,000.[3] The district court entered a judgment on the jury's verdict, and, after this permissive appeal was filed, that judgment was affirmed by an unpublished opinion. Vinson v. Equity Resources, 141 F.3d 1190 (11th Cir.1998) (table).
The essential elements of res judicata are (1) a prior judgment on the merits, (2) rendered by a court of competent jurisdiction, (3) with substantial identity of the parties, and (4) with the same cause of action presented in both actions. If those four elements are present, then any claim that was, or that could have been, adjudicated in the prior action is barred from further litigation. Dairyland Ins. Co. v. Jackson, 566 So. 2d 723, 725-26 (Ala.1990).
The federal district court entered a judgment in favor of Vinson and against Equity Resources on the merits of Vinson's federal statutory age-discrimination claim. That court also entered a judgment on the merits in favor of the individual defendants Spina, Fiorella, and Bohn. See Higgins v. Henderson, 551 So. 2d 1050, 1053 (Ala.1989) ("In a federal court, dismissal for failure to state a claim on which relief may be granted is an adjudication on the merits of the case."). Subject matter jurisdiction over federal age-discrimination claims is expressly conferred on federal district courts. See 29 U.S.C. § 626(c)(1). The dispositive issue on this appeal is, therefore, whether the fourth element of res judicatathat each action was based on the same cause of actionis present.
This Court, in Whisman v. Alabama Power Co., 512 So. 2d 78, 81 (Ala.1987), restated the elements of res judicata:
(Citations omitted. Emphasis in original.) This statement from Whisman is consistent with a long line of cases holding that whether the second action presents the same cause of action depends on whether the issues in the two actions are the same and on whether substantially the same evidence would support a recovery in both actions. See, e.g., Sessions v. Jack Cole Co., 276 Ala. 10, 158 So. 2d 652 (1963); Gulf American Fire & Casualty Co. v. Johnson, 282 Ala. 73, 209 So. 2d 212 (1968); Geer Brothers, Inc. v. Crump, 349 So. 2d 577 (Ala.1977); Dominex, Inc. v. Key, 456 So. 2d 1047 (Ala.1984); Sullivan v. Walther Builders, Inc., 495 So. 2d 655 (Ala.1986); Pierce v. Rummell, 535 So. 2d 594 (Ala.1988); Garris v. South Alabama Production Credit Ass'n, 537 So. 2d 911 (Ala. 1989); Dairyland Ins. Co. v. Jackson, supra; Croft v. Pate, 585 So. 2d 799 (Ala.1991); Selma Foundry & Supply Co. v. Peoples Bank & Trust Co., 598 So. 2d 844 (Ala.1992); Vaughan v. Barr, 600 So. 2d 994 (Ala.1992); Reed v. Brookwood Medical Center, 641 So. 2d 1245 (Ala.1994); Benetton S.p.A. v. Benedot, Inc., 642 So. 2d 394 (Ala.1994); see also other cases collected at 34 Ala. Digest 2d Judgment Key No. 585(2) (1994).
Even though some of our cases have recognized that the plaintiff's presentation of alternative legal theories in a second action can be a factor to be considered in determining whether the two causes of action are the same, see, e.g., Benetton S.p.A. v. Benedot, Inc., supra; Vaughan v. Barr, supra; and Dairyland Ins. Co. v. Jackson, supra, this Court has made it very clear that the determinative inquiry is whether the claims in both actions arise out of, and are subject to proof by, the same evidence. See Gulf American Fire & Casualty Co. v. Johnson, supra, 282 Ala. at 78, 209 So. 2d at 216, quoting Cannon v. Brame, 45 Ala. 262, 263 (1871):
(Citation omitted.) See also Geer Brothers, Inc. v. Crump, supra, 349 So. 2d at 580 ("Even though the forms of the action, past and present, are different, if substantially the same evidence supports their issues, the judgment in the former action is a bar to the latter."); Benetton S.p.A. v. Benedot, Inc., supra, 642 So. 2d at 399 ("In Selma Foundry, this Court made it clear that the `same evidence' test applies in determining whether the same cause of action is presented in consecutive actions with regard to the fourth element of res judicata."); Garris v. South Alabama Production Credit Ass'n, supra, 537 So. 2d at 914 ("Regardless of the form of the action, the issue is the same when it is supported in both actions by substantially the same evidence."); and Reed v. Brookwood Medical Center, supra, 641 So. 2d at 1247 ("For purposes of determining whether the doctrine of res judicata applies to a claim, the manner in which the claim is labeled in the complaint does not necessarily determine the nature of the claim.").
Difference in the proof of damages is not a ground for distinguishing the issues in each case. Sessions v. Jack Cole Co., supra; Geer Brothers, Inc. v. Crump, supra; Terrell v. City of Bessemer, 406 So. 2d 337 (Ala.1981). Compare Pierce v. Rummell, supra, wherein this Court held that the plaintiff's motion for a rule nisi against her former husband, seeking to have him found in contempt of court for his failure to comply with the parties' divorce judgment, did not bar her later action seeking compensatory and punitive damages for fraud and conspiracy to defraud. This Court noted in Pierce that the rule-nisi motion and the action for civil damages addressed entirely different wrongful acts, for which different forms of relief were available.
*638 In Weaver v. Hood, 577 So. 2d 440, 442 (Ala.1991), this Court, citing Terrell v. City of Bessemer, supra, summarized these principles in the context of § 6-5-440's prohibition against splitting a single cause of action into state and federal actions that arise out of the same facts:
See also Hughes v. Allenstein, 514 So. 2d 858 (Ala.1987).
Justice Beatty, writing for this Court in Geer Brothers, Inc. v. Crump, supra, noted that "[t]he description of those cases against which the defense of res judicata is inapplicable has not always been an easy task, but the decisions have laid down helpful guidelines." 349 So. 2d at 579. Having again surveyed Alabama caselaw on this point, we would have to agree with Justice Beatty's assessment. However, a clearly definable and pragmatic rule appears to have evolved over the years for determining whether a consecutive action by the same plaintiff against the same defendant or defendants is based on the same cause of action. That rule, gleaned from the cases cited above, can be summarized as follows: The application of the doctrine of res judicata to identical causes of action is not dependent on the identity or differences in the forms of the two actions, although such differences may be considered. If a claim, which arises out of a single wrongful act or dispute, is brought to a final conclusion on the merits, then all other claims arising out of that same wrongful act or dispute are barred, even if those claims are based on different legal theories or seek a different form of damages, unless the evidence necessary to establish the elements of the alternative theories varies materially from the evidence necessary for a recovery in the first action. In taking this approach, this Court has adopted a test that in certain respects is similar to, but which is not the same as, the "same transaction" test, which is found in Restatement (Second) of Judgments and which is applied in the federal courts. Although Justice Cook in his special writing advocates the use of that test in the present case, this Court discussed that test in Selma Foundry & Supply Co. v. *639 Peoples Bank & Trust Co., supra, and specifically rejected it.
After carefully examining the allegations contained in Vinson's federal- and state-court complaints, and after reviewing the federal district court's "Order on Pretrial Hearing," we conclude that Vinson's state-law claims are barred. The basic issues in the federal action centered around whether the defendants, and specifically Carol Bohn, had intentionally discriminated against Vinson by terminating her employment solely on the basis of her age. Vinson specifically alleged in the federal action that the defendants had made material misrepresentations to her concerning her job security and that she had relied on those misrepresentations to her detriment, by giving up an opportunity for other employment. Vinson made these same allegations in her state action. She also alleged in her state action that the defendants had breached a contract by terminating her employment for a reason other than the grounds set out in the company's "Policies and Procedures Manual" and that the defendants had negligently or wantonly hired or failed to train or supervise "staff who act responsibly, and in accordance with the law, toward their employees." Vinson's federal age-discrimination claim and her state-law claims, including her rather vague state constitutional claims, all arose out of the same acts, and her state claims logically would be subject to proof by the very same evidence that supported her federal age-discrimination claim. Although Vinson's state-law action was instituted on legal theories of recovery different from those pursued in the federal action, those theories, in light of the substantial overlap of factual issues and evidence, do not constitute different causes of action for res judicata purposes. Vinson did not request that the district court exercise pendent jurisdiction over her state-law claims, and it is not clear from the record that the district court would have declined such a request. Terrell v. City of Bessemer, supra. Therefore, the federal judgment bars her state action under the doctrine of res judicata. Weaver v. Hood, supra.
The trial court's order denying the defendants' motion for a summary judgment is reversed, and the cause is remanded.
REVERSED AND REMANDED.
HOOPER, C.J., and ALMON, SHORES, SEE, and LYONS, JJ., concur.
MADDOX and COOK, JJ., concur in the result.
COOK, Justice (concurring in the result).
I concur in the majority's conclusion that Linda Vinson's action against Equity Resources Management, Inc. ("Equity"), and various individual defendants is barred by the doctrine of res judicata. I also agree with the majority that this Court in Selma Foundry & Supply Co. v. Peoples Bank & Trust Co., 598 So. 2d 844, 848 (Ala.1992), expressly rejected the "`same transaction' test, which is found in Restatement (Second) of Judgments and which is applied in the federal courts." 723 So. 2d at 638. However, when this Court is determining the preclusive effect of a prior federal-court judgment involving a federal questionas in this caseit does not have the option of rejecting the "same transaction" test.
The rule is universally recognized that in such a case, "the federal rule of res judicata determines whether [the second action is barred by the judgment in the first]. See Restatement (Second) of Judgments § 87 (1982); 18 C. Wright, A. Miller, E. Cooper, Federal Practice and Procedure § 4466 (1981); Degnan, Federalized Res Judicata, 85 Yale L.J. 741, 769 (1976)." Matter of Energy Cooperative, Inc., 814 F.2d 1226, 1230 (7th Cir.), cert. denied sub nom. Energy Cooperative, Inc. v. Phillips Petroleum Co., 484 U.S. 928, 108 S. Ct. 294, 98 L. Ed. 2d 254 (1987); see also Hawkins v. Risley, 984 F.2d 321 (9th Cir.1993); Nutter v. Monongahela Power Co., 4 F.3d 319 (4th Cir.1993); Russell v. SunAmerica Securities, Inc., 962 F.2d 1169 (5th Cir.1992); Kachler v. Taylor, 849 F. Supp. 1503 (M.D.Ala.1994). In other words:
Anderson v. Phoenix Inv. Counsel of Boston, Inc., 387 Mass. 444, 449-50, 440 N.E.2d 1164, 1167-68 (1982) (emphasis added). See also Stanfield v. Osborne Indus., Inc., 263 Kan. 388, 949 P.2d 602 (1997); Ray v. Leatherman, 688 So. 2d 1133 (La.Ct.App.1996), writ denied, 685 So. 2d 123 (La.1997); Richman v. FWB Bank, 122 Md.App. 110, 712 A.2d 41 (1998).
Vinson first commenced this action in the United States District Court for the Middle District of Alabama against (1) Equity, (2) Jack Fiorella, (3) Paul Spina, and (4) Carol Bohn. The defendants were, respectively (1) her corporate employer; (2) Equity's "president and majority shareholder"; (3) Vinson's "direct supervisor"; and (4) Equity's "director of property management." The operative facts giving rise to this cause of action are stated as follows in an "Order on Pretrial Hearing" entered by that court:
Vinson's complaint sought recovery pursuant to the Age Discrimination in Employment Act ("ADEA"), 29 U.S.C. § 621 et seq. Specifically, she sought compensation for:
On April 3, 1996, the district court dismissed the individual plaintiffs, holding that the *641 ADEA "does not allow for individual liability." Brief of Appellee, at 7. The action was then tried to a jury, which "found that [Equity] discriminated against [Vinson] because of her age, in violation of the [ADEA] and awarded her damages in the amount of $86,000." On April 4, 1997, the district court entered a judgment on that verdict. On April 9, 1998, the United States Court of Appeals for the Eleventh Circuit affirmed the judgment.
Meanwhile, on August 13, 1996, Vinson filed a complaint against Equity, Fiorella, Spina, and Bohn in the Montgomery County Circuit Court. Her state-court complaint sought recovery on theories of (1) fraud, (2) breach of contract, (3) equal protection and due process guarantees, and (4) negligent "hiring, training, supervision and/or retention of Carol A. Bohn." As she had in the federal court, she sought compensation for:
On September 15, 1997, the defendants moved for a summary judgment, contending that the claim asserted in the state-court complaint arose "from the termination of [Vinson's] employment with [Equity]"; that that claim "could have been asserted in the Prior Action pursuant to the Federal District Court's supplemental jurisdiction"; and, consequently, that Vinson's state-court action was barred by the doctrine of res judicata. The trial court denied the motion, and we granted permission to appeal that denial. Under these facts, this Court has no choice but to apply what the majority refers to as "the `same transaction' test, which is found in Restatement (Second) of Judgments and which is applied in the federal courts." 723 So. 2d at 638.
Under that test:
Page v. United States, 729 F.2d 818, 820 (D.C.Cir.1984) (footnotes omitted). "Once a transaction has caused injury, all claims arising from that transaction must be brought in one suit or be lost." Car Carriers, Inc. v. Ford Motor Co., 789 F.2d 589, 593 (7th Cir. 1986).[4]
Application of this test compels the conclusion that Vinson's claims are barred by the doctrine of res judicata. There is but one cause of action in this caseVinson's layoff. She suffered only one injury, as evidenced by the functionally identical damages demands asserted in the two complaints. A resolution of the state-court claims would necessarily turn on the actions and motives of Carol Bohn, just as the resolution of the federal-court claims did. For these reasons, I concur only in the result the majority reaches.
[1] Some documents in the record spell this party's name "Carole."
[2] Although the defendants have raised them in their brief, they did not in their summary judgment motion raise the specific issues of collateral estoppel and the splitting of causes of action under Ala.Code 1975, § 6-5-440; thus, those issues are not before us in this permissive appeal.
There is a line of cases holding or implying that the doctrine of res judicata consists of two subsets: claim preclusion and issue preclusion. Marshall County Concerned Citizens v. City of Guntersville, 598 So. 2d 1331, 1332 (Ala.1992); Whisman v. Alabama Power Co., 512 So. 2d 78, 84 (Ala.1987); see Restatement (Second) of Judgments Chapter 3, Introductory Note, §§ 13, 17 (1982); 46 Am.Jur.2d, Judgments, §§ 514-17, § 524, § 539 (1994). Another line of cases treats res judicata as claim preclusion and as a different doctrine from collateral estoppel or issue preclusion. Dairyland Ins. Co. v. Jackson, 566 So. 2d 723, 725-26 (Ala.1990); Jones v. Blanton, 644 So. 2d 882, 885 n. 1 (Ala.1994). It is not necessary for us to resolve that conflict in this case because clearly the defendants, in their motion for a summary judgment, treated res judicata as claim preclusion only, and the ruling on that motion is what we granted the defendants permission to appeal. It is well settled that this Court will not reverse a judgment or ruling on a ground raised for the first time on appeal. Smith v. Equifax Services, Inc., 537 So. 2d 463 (Ala.1988).
[3] The district court awarded Vinson's attorney $22,961.77 in attorney fees and expenses.
[4] For further examples of federal cases applying that test, see In re Justice Oaks II, Ltd., 898 F.2d 1544 (11th Cir.), cert. denied sub nom. Wallis v. Justice Oaks II, Ltd., 498 U.S. 959, 111 S. Ct. 387, 112 L. Ed. 2d 398 (1990); Shaver v. F.W. Woolworth Co., 840 F.2d 1361 (7th Cir.), cert. denied, 488 U.S. 856, 109 S. Ct. 145, 102 L. Ed. 2d 117 (1988); Page v. United States, 729 F.2d 818, 820 (D.C.Cir.1984); and Southmark Properties v. Charles House Corp., 742 F.2d 862 (5th Cir. 1984). | bf15762b351aa0358e7b0fb77f29e456238958c2d9bae9967da5e66af293acf7 | 1998-11-13 00:00:00 |
d596608e-79f5-4b23-91f8-cb91e525a535 | Ex Parte Boyette | 728 So. 2d 644 | 1971554 | Alabama | Alabama Supreme Court | 728 So. 2d 644 (1998)
Ex parte Tom BOYETTE.
(Re Tom Boyette v. Jefferson County, Alabama, et al.)
1971554.
Supreme Court of Alabama.
December 18, 1998.
*645 Adam M. Porter, Birmingham, for petitioner.
Michael G. Graffeo, general counsel, Jefferson County Personnel Board; and Jeffrey M. Sewell, asst. county atty., for respondents.
PER CURIAM.
This Court has granted the plaintiff Tom Boyette's petition for review of a decision of the Court of Civil Appeals. See Boyette v. Jefferson County, 728 So. 2d 639 (Ala.Civ. App.1998). The petition asserts that the decision of the Court of Civil Appeals conflicts with Ex parte Averyt, 487 So. 2d 912 (Ala. 1986), and other cases. The question is whether the Court of Civil Appeals correctly relied on Ex parte Smith, 683 So. 2d 431 (Ala.1996),[1] to affirm a summary judgment for Jefferson County on Boyette's complaint alleging a violation of the Age Discrimination in Employment Act, 29 U.S.C. § 621 et seq. ("ADEA"), or whether, under Averyt, the summary judgment should have been reversed. May Boyette pursue this action, which is collateral to the proceedings by which his employment with the county was terminated, or is this action barred by a res judicata effect of his failure to raise the ADEA claim in those proceedings?
The Court of Civil Appeals also affirmed the summary judgment on Boyette's claims other than his ADEA claim, and, as to his ADEA claim, affirmed the summary judgment for the defendants other than the county. Boyette's certiorari petition did not seek review of those holdings; those holdings, therefore, are not before us.
We hold that Smith is distinguishable and Averyt is controlling, because Smith relies upon the Alabama Administrative Procedure Act ("AAPA"), specifically § 41-22-20(k)(1), Ala.Code 1975, whereas the proceedings for review of Boyette's termination were governed by § 22 of Act No. 248, 1945 Ala. Acts p. 376, as amended by Act No. 679, 1977 Ala. Acts p. 1176, the provisions of which are analogous to the provisions pertinent to Averyt. Section 41-22-20(k)(1) allows a court reviewing an administrative action that is subject to the AAPA to "grant other appropriate relief from the agency action, equitable or legal, ... if substantial rights of the petitioner have been prejudiced because the agency action is ...: (1) In violation of constitutional or statutory provisions...." By contrast, the local acts at issue here and in Averyt provide only for limited review of the agency decision. Section 22 of Act No. 248, as amended, states:
(Emphasis added.) This provision for "review" is far short of the broad power in AAPA proceedings for a circuit court to determine whether "the agency action [is in] violation of constitutional or statutory provisions." As the succeeding discussion will show, administrative agencies ordinarily have limited authority to decide allegations of constitutional and statutory violations, and appellate review of agency decisions has been limited to the questions within the agency's authority. Only because the AAPA grants more expansive authority to a court hearing an appeal from an agency decision does Smith disallow a collateral attack raising constitutional and statutory claims that were outside the authority of the administrative agency to decide.
In Averyt, Clyde Averyt had been discharged as a firefighter for the City of Mobile, and the Mobile County Personnel Board *646 had upheld that discharge. Averyt appealed the Board's ruling to the circuit court and filed a collateral action in the circuit court alleging constitutional violations. The Court of Civil Appeals affirmed the dismissal of the collateral action, Averyt v. Doyle, 456 So. 2d 1096 (Ala.Civ.App.1984) (Averyt I), and Averyt, instead of petitioning this Court for certiorari review, proceeded with the administrative appeal, as mandated by the Court of Civil Appeals. However, the circuit court hearing the administrative appeal did not allow Averyt to add his constitutional claims, and that court affirmed the Board's order upholding his discharge. The Court of Civil Appeals affirmed, holding:
Averyt v. City of Mobile Fire Dep't, 487 So. 2d 909, 910-11 (Ala.Civ.App.1985) (Averyt II).
This Court reversed:
Ex parte Averyt, 487 So. 2d 912, 913-14 (Ala. 1986) (some emphasis original; other emphasis added) (brackets original).
In City of Homewood v. Caffee, 400 So. 2d 375 (Ala.1981), this Court affirmed a judgment holding unconstitutional a zoning ordinance as applied to the facts at issue. The Court rejected the city's argument that the collateral action was barred by the pendency of the appeal from the order of the Board of Zoning Adjustments denying Caffee's request for a variance. "[B]ecause the Board of Zoning Adjustments was without authority to consider any constitutional attack on the Homewood ordinance, Caffee's constitutional challenge to that ordinance in the circuit court was not precluded by the City's claims of `identical issues' in both proceedings." 400 So. 2d at 378.
The Court of Civil Appeals has cited Ex parte Averyt and Caffee in upholding an order affirming the dismissal of a police-department employee:
Joyner v. City of Bayou La Batre, 572 So. 2d 492, 493 (Ala.Civ.App.1990), citing Caffee and Ex parte Averyt.
Similarly, the Court of Civil Appeals has cited Ex parte Averyt and Caffee as stating an exception to the doctrine of exhaustion of administrative remedies. Hamilton v. City of Fairhope, [Ms. 2970785, June 26, 1998] ___ So.2d ___ (Ala.Civ.App.1998); City of Daphne v. Dolan, 603 So. 2d 1042 (Ala.Civ. App.1991), reversed sub nom. Ex parte Lake Forest Property Owners' Ass'n, 603 So. 2d 1045 (Ala.1992).
In City of Daphne, supra, the Court of Civil Appeals held that the circuit court had improperly ruled on a matter that could have been, but was not, raised in the administrative proceedings, but this Court reversed. The question was whether some signs in a subdivision should be allowed to remain under a grandfather clause in a city ordinance; this Court deemed the interpretation of the ordinance to be a question of law and therefore concluded that it "did not require an administrative finding of fact or the exercise of administrative discretion." Ex parte Lake Forest Property Owners' Ass'n, 603 So. 2d at 1047. This Court cited Caffee and City of Gadsden v. Entrekin, 387 So. 2d 829 (Ala. 1980), as authority for the statement that the doctrine of exhaustion of administrative remedies
Ex parte Lake Forest Property Owners' Ass'n, supra, 603 So. 2d at 1046-47.
*648 In Docena Fire District v. Rucker, 564 So. 2d 422 (Ala.1990), this Court held that an appeal from the probate court to the circuit court did not give the circuit court jurisdiction to consider constitutional questions that the probate court did not have jurisdiction to adjudicate. "Docena Fire District could have invoked the general jurisdiction of the circuit court by way of a collateral suit to properly raise its constitutional challenges. Wallace v. State, [infra]; and Ex parte Averyt, supra." 564 So. 2d at 425. In Wallace v. State, 507 So. 2d 466 (Ala.1987), the Court dismissed an appeal from a probate court by which the appellants sought to challenge the constitutionality of a portion of the statute that gave the probate court jurisdiction to hear the appellants' petition to incorporate a municipality. Although these cases arise from probate court proceedings, not administrative proceedings, they follow the holdings from Caffee and Averyt and stand for the general proposition that a circuit court has general jurisdiction to entertain a collateral attack on a ruling by a court or a quasi-judicial body with limited jurisdiction, when the attack raises questions that were outside that limited jurisdiction.
All of these authorities support Boyette's position that his ADEA claim was not within the competence of the Board and therefore was not within the jurisdiction of the circuit court to which he appealed pursuant to Section 22 of Act 248, as amended. This conclusion is reinforced by the fact that the Personnel Board refused to hear any claims of discrimination. During his opening statement at the hearing before the Board, Boyette's counsel stated:
From this statement it appears that the Board had acknowledged that it could not hear a discrimination claim such as the ADEA claim that Boyette is now trying to pursue.
We now turn to Ex parte Smith, 683 So. 2d 431 (Ala.1996), to determine whether it compels a contrary conclusion. We note first that this Court, in deciding Smith, did not cite Ex parte Averyt, City of Homewood v. Caffee, or any of the other cases discussed above. The Court of Civil Appeals, in Smith v. Alabama Aviation & Technical College, 683 So. 2d 426 (Ala.Civ.App.1995), had distinguished Ex parte Averyt with only the following statement:
683 So. 2d at 431. However, this Court in Ex parte Averyt had said that the federal claims were "not within the purview of the Board," 487 So. 2d at 913, and that the collateral action "was the only avenue available for his presentation of the constitutional issues raised therein." Id. (emphasis original). Ex parte Averyt is not distinguishable from Smith on the ground that Averyt did not raise his collateral issues in the administrative proceedings but Smith did: according to Ex parte Averyt and the other cases above, the Board would not have had the authority to decide the ADEA claim even if Boyette had raised it, and the circuit court would therefore not have had jurisdiction to consider that question in its review of the Board's action.
Alton Wayne Smith was a professor of avionics at the Alabama Aviation and Technical College, a state institution. Smith sought review of his termination, pursuant to regulations of the State Board of Education, and received a hearing before an employee review panel. These proceedings occurred before state agencies, pursuant to state statutes, e.g., § 16-60-110 et seq. and § 36-26-105, Ala.Code 1975. Smith's right of appeal from the decision of the employee review panel was provided for and governed by the AAPA, specifically § 41-22-20. The Court of Civil Appeals affirmed a summary judgment *649 for the defendants in Smith's collateral action. This Court affirmed, relying on the provision in § 41-22-20(k)(1) that allows a reviewing court to grant relief if the agency action violated constitutional or statutory rights:
Ex parte Smith, 683 So. 2d at 435-36.
In making this holding, the Court did not overrule Ex parte Averyt, Caffee, the other cases cited above, and other similar cases. Those cases can be reconciled with Smith only on the ground that § 41-22-20(k)(1) gives a reviewing court broader jurisdiction to grant relief than it usually has in appeals from administrative decisions. We therefore expressly hold that Smith is limited to situations governed by the AAPA.
Boyette's appeal from the ruling of the Personnel Board of Jefferson County was provided for and was governed by § 22 of Act No. 248,1945 Ala. Acts p. 376, as amended by Act No. 679, 1977 Ala. Acts p. 1176. It was not governed by the AAPA. Because § 22 does not give the broad power to grant relief that § 41-22-20(k)(1) gives, the principle of Smith is inapplicable here. Instead, the principles of Ex parte Averyt and the other cases discussed above are applicable, and Boyette's collateral action is "not only proper, but ... the only avenue available" for him to raise his ADEA claim. Ex parte Averyt, 487 So. 2d at 913 (emphasis original). Therefore, the circuit court erred in entering the summary judgment on that claim, and the affirmance by the Court of Civil Appeals conflicts with Ex parte Averyt, 487 So. 2d 912 (Ala.1986). Insofar as it relates to Boyette's ADEA claim against Jefferson County, the judgment of the Court of Civil Appeals is reversed, and the cause is remanded.
REVERSED AND REMANDED.
HOOPER, C.J., and ALMON, SHORES, KENNEDY, COOK, and LYONS, JJ., concur.
MADDOX and SEE, JJ., concur in the result.
[1] Cert. denied, Smith v. Alabama Aviation & Tech. College, 520 U.S. 1165, 117 S. Ct. 1426, 137 L. Ed. 2d 536 (1997). | 7894152751dbabea544cb470e3b43f5eb13c165e6f65a4a94fdc8fee73c5607d | 1998-12-18 00:00:00 |
cc87e2ba-eaa2-47e0-9c69-d5861b8c72e1 | Ex Parte LaCoste | 733 So. 2d 889 | 1970957 | Alabama | Alabama Supreme Court | 733 So. 2d 889 (1998)
Ex parte Virginia N. LaCOSTE.
(In re Virginia N. LaCoste v. SCI Alabama Funeral Services, Inc., d/b/a Roche-Belmany-Herrington Funeral Homes)
No. 1970957.
Supreme Court of Alabama.
November 13, 1998.
Rehearing Denied February 26, 1999.
Peter F. Burns of Burns, Cunningham & Mackey, P.C., Mobile; and John F. Whitaker of Sadler, Sullivan, Sharp & Van Tassel, P.C., Birmingham, for petitioner.
Edward A. Dean of Armbrecht, Jackson, DeMouy, Crowe, Holmes & Reeves, Mobile; and Andrew P. Campbell and David M. Loper of Campbell, Waller & McCallum, L.L.C., Birmingham, for respondent.
HOUSTON, Justice.
In 1978, the United States District Court for the Northern District of Alabama entered a final judgment pursuant to a settlement agreement in Battle v. *890 Liberty National Life Ins. Co. (CV-70-H-752-S), a consolidation of three class actions (Battle v. Liberty National Life Ins. Co.; Campbell v. Liberty National Life Ins. Co.; and Holman v. Liberty National Life Ins. Co.) alleging federal anti-trust violations and fraud with respect to the issuance, sale, and performance of certain burial and/or vault insurance policies by Liberty National Life Insurance Company ("Liberty National") and Brown-Service Funeral Home Company, Inc. ("Brown-Service"). The settlement was the result of seven years of litigation in both federal and state courts.
The district court in Battle made permanent two plaintiff classes: 1) all owners of Alabama funeral homes from June 29, 1954, until September 22, 1977, certified as a class under Rule 23(b)(3), Fed.R.Civ.P.; and 2) all insureds with burial or vault policies, certified as a class under Rule 23(b)(2). The only defendants in Battle were Liberty National and Brown-Service. The final judgment established the rights and obligations of approximately 300 owners of some 400 funeral homes in Alabama and the rights under the burial/vault policies of approximately one million policyholders. The district court expressly retained jurisdiction over the case, stating in the judgment:
Under this retained jurisdiction, the district court has been asked from time to time to settle disputes concerning the application of its judgment to particular burial policies. For a good explanation of the ongoing Battle litigation, see Battle v. Liberty National Life Ins. Co., 660 F. Supp. 1449 (N.D.Ala.1987); Battle v. Liberty National Life Ins. Co., 877 F.2d 877 (11th Cir.1989); Battle v. Liberty National Life Ins. Co., 770 F. Supp. 1499 (N.D.Ala.1991); and Battle v. Liberty National Life Ins. Co., 974 F.2d 1279 (11th Cir.1992).
By an order dated March 3, 1987, the district court, in Obering v. Ridout's-Brown Service, Inc., CV-86-H-2372-S, explained that it had not intended in Battle to retain jurisdiction over all individual breach-of-contract and fraud actions filed against funeral-service providers and relating to Liberty National policies:
In 1990 the district court issued a similar order in Johnson v. Memory Chapel Funeral Homes, Inc., CV-89-H-2117-W:
On February 25, 1994, Virginia N. LaCoste, the petitioner in this proceeding, *892 filed an action in the Mobile Circuit Court against SCI Alabama Funeral Services, Inc., d/b/a Roche-Belmany-Herrington Funeral Homes ("SCI"), seeking damages based on allegations of fraud and breach of contract. LaCoste's claims arose out of her husband's funeral and centered on the same kind of burial policy that was at issue in Battle.
Twenty months later, on October 25, 1995, Carol Williams and Annie Merle Williams, individually and on behalf of others similarly situated, filed an action in the Mobile Circuit Court against SCI and others, seeking damages based on allegations of breach of contract and fraud. These allegations were essentially the same as those that had been previously made by LaCoste. A little over two months later, on January 8, 1996, Mary Sue Thrash and James E. Thrash filed a substantially similar action in the Mobile Circuit Court against SCI and others. The record indicates that the Williams and Thrash actions were later certified as breach-of-contract class actions only, with no claims for punitive damages or mental distress. The defendants in Williams and Thrash were successful in removing both cases to the United States District Court for the Southern District of Alabama. On July 23, 1997, that court denied the plaintiffs' motions to remand the cases to the state court and, instead, granted the defendants' motions to transfer the cases to the northern district for consolidation with Battle. That court's July 23, 1997, order read:
On October 1, 1997, five days before the scheduled trial, the Mobile Circuit Court, on motion of SCI, dismissed LaCoste's action, with the following docket entry:
On November 26, 1997, the district court overseeing the Battle litigation accepted jurisdiction over Williams and Thrash, denied the plaintiffs' motions to remand, and consolidated Williams and Thrash with Battle. That court also directed the parties in Battle to address certain issues relevant to an interpretation of its 1978 judgment. The court stated that "clarification of [its] final judgment may be `outcome determinative' of the consolidated cases."
LaCoste appealed the trial court's October 1, 1997, order to this Court and we transferred the case to the Court of Civil Appeals under Ala.Code 1975, § 12-2-7(6). The Court of Civil Appeals held the dismissal to be proper under the abatement statute, Ala.Code 1975, § 6-5-440. LaCoste v. SCI Alabama Funeral Services, Inc., 733 So. 2d 886 (Ala.Civ.App.1998). Specifically, the Court of Civil Appeals found 1) that LaCoste was a member of the class of plaintiff policyholders in Battle; 2) that SCI was a named defendant in Williams and Thrash, which had been consolidated with Battle; and 3) that LaCoste's claims centered on the same kind of burial policy that was at issue in Battle, in which the court had retained jurisdiction to implement its judgment. Based on these findings, the Court of Civil Appeals concluded that, "with the possible exception of LaCoste's fraud claim," 733 So. 2d at 888, LaCoste's action had been abated by Battle and that it was, therefore, due to be dismissed. The Court of Civil Appeals went on to state that "if the federal court refuses to exercise pendent jurisdiction and allow LaCoste to litigate the fraud claim, then LaCoste's claim would be allowed under an exception to § 6-5-440." 733 So. 2d at 888. LaCoste petitioned for certiorari review under Rule 39, Ala. R.App.P. We reverse and remand.
The sole issue presented by this petition is whether LaCoste's action was due to be dismissed under § 6-5-440, which provides:
It is not controverted that the phrase "courts of this state," as used in § 6-5-440, includes a United States district court within this state. Terrell v. City of Bessemer, 406 So. 2d 337 (Ala.1981). LaCoste contends, however, that both the trial court and the Court of Civil Appeals misapplied the law to the facts. Specifically, LaCoste argues that when she filed her action in 1994 she was not prosecuting another action against SCI in an Alabama court, state or federal. She points out that SCI was not a defendant in Battle when she filed her action. SCI contends, on the other hand, that "the fact that SCI ... was not originally designated a `defendant' in Battle has no significance given the consolidation of several actions in Battle and the relief granted to the plaintiff policyholders *894 against the funeral director class, which includes SCI." After carefully examining the record and the briefs, we agree with LaCoste that her action was erroneously dismissed under § 6-5-440.
The record indicates, as the Court of Civil Appeals noted, that LaCoste's claims centered on the same kind of burial policy that was at issue in Battle and that the district court's resolution of certain issues in the ongoing Battle litigation may be dispositive of the issue presented by LaCoste. However, those considerations do not dictate that LaCoste's action be dismissed under § 6-5-440. Section 6-5-440 prohibits the prosecution of two actions at the same time for the same cause and against the same party. As previously noted, SCI was not a defendant in Battle in 1994 when LaCoste filed her action in the Mobile Circuit Court. It appears that SCI, like LaCoste, was a member of a plaintiff class in Battle, seeking a remedy against Liberty National and Brown-Service. Although the district court in Battle had expressly retained jurisdiction over the case for the purpose of effectuating its judgment, the court had on at least two occasions before LaCoste filed her action held that it had not retained jurisdiction over all individual breach-of-contract and fraud actions against funeral-service providers. The court indicated that it would reconsider its position on the jurisdiction issue if and when actions against funeral-service providers grew so numerous as to threaten its control and administration of the litigation. In any event, when LaCoste filed her action in 1994, she had no claim pending against SCI in Battle, and the district court had clearly signaled that it did not intend to exercise jurisdiction over individual state damages actions against funeral-service providers. It was not until 1997, when the district court sitting in Mobile transferred the Williams and Thrash class actions to the northern district for consolidation with Battle and the district court overseeing Battle accepted jurisdiction over those actions, that LaCoste apparently became a member of a plaintiff class asserting breach-of-contract claims against SCI in the Battle litigation. Williams and Thrash were filed and certified as class actions after LaCoste had filed her action. Therefore, under the plain wording of § 6-5-440, LaCoste's individual action would have provided SCI with a good defense to her continued participation in the plaintiff classes in Williams and Thrash; however, because the filing of her individual action preceded the filing of Williams and Thrash, her action did not abate under § 6-5-440. Of course, LaCoste may not simultaneously pursue her individual action and participate in the plaintiff classes in Williams and Thrash. See Ex parte State Mutual Ins. Co., 715 So. 2d 207 (Ala.1997), wherein a majority of this Court has recently held that an individual action is not abated by a subsequently filed class action.
We do not address the questions whether LaCoste's action is subject to removal to the federal court, or whether under federal law the district court in Battle may enjoin LaCoste's individual state action. See the decisions of the district court and the United States Court of Appeals for the Eleventh Circuit in Battle v. Liberty National Life Ins. Co., 660 F. Supp. 1449 (N.D.Ala.1987), and Battle v. Liberty National Life Ins. Co., 877 F.2d 877 (11th Cir.1989). Those questions would ultimately have to be resolved in the federal court. We hold only that LaCoste's action was not subject to dismissal under § 6-5-440.
We also note SCI's contention that the dismissal of LaCoste's action was proper under the doctrine of res judicata or the doctrine of collateral estoppel. The Court of Civil Appeals did not address this contention, and we decline to address it for the first time on certiorari review.
For the foregoing reasons, the judgment of the Court of Civil Appeals is reversed and the cause is remanded for further proceedings consistent with this opinion.
REVERSED AND REMANDED.
*895 HOOPER, C.J., and MADDOX, ALMON, and SEE, JJ., concur.
LYONS, J., concurs in the judgment and concurs in part in the rationale, but dissents from dictum.
COOK, J., concurs in the judgment but dissents from the rationale.
SHORES, J., recuses herself.
LYONS, Justice (concurring in the judgment and concurring in part in the rationale, but dissenting from dictum).
I concur with the main opinion except to the extent that it endorses the holding in Ex parte State Mutual Ins. Co., 715 So. 2d 207 (Ala.1997), construing § 6-5-440, Ala. Code 1975, to prohibit the maintenance of an individual action commenced after the filing of an action on behalf of a class of which the individual is a member. Section 6-5-440 provides:
The statute deals with the plaintiff who deliberately has filed two cumulative actions. I have difficulty with the concept of applying it generally to a member of a class because it ascribes an intent to proceed in cumulative actions, an intent that cannot logically be found merely from a person's status as a member of a class.
When § 6-5-440 was enacted in 1907, there was no rule of procedure comparable to Rule 23(b)(3), Ala. R. Civ. P., which was promulgated in 1973. Rule 23(b)(3) permits a representative acting on behalf of a class to state a claim for money damages on behalf of members of the class. Rule 23(c)(2) assures notice to the members of the class advising them of their right to request exclusion from the class. But, until a member of a Rule 23(b)(3) class has received notice and has failed to request exclusion, I am unwilling to ascribe to that person the intent to prosecute two cumulative actions, the intent made the object of § 6-5-440.
While we need to ameliorate the problems caused by redundancy of claims in the class-action setting, I am not convinced that a creative application of § 6-5-440 is appropriate. We should invite the Advisory Committee on Rules of Civil Procedure to propose an amendment to Rule 23 that deals with multiple claims in the context of separate individual actions and class actions as well as multiple class actions dealing with the same subject matter. Until we do that, I cannot embrace the application of § 6-5-440 beyond the limited circumstance described herein. In other words, I would not apply § 6-5-440 to block a later-filed individual action when the individual has requested exclusion from a previously filed class action. For the reason expressed herein, I also question the application of § 6-5-440 to class actions brought pursuant to Rule 23(b)(1) or Rule 23(b)(2), in which the right to notice and exclusion is unavailable.
COOK, Justice (concurring in the judgment but dissenting from the rationale).
I concur to reverse the judgment of the Court of Civil Appeals. That court erred when it concluded that Ala.Code 1975, § 6-5-440, somehow required the abatement of the action commenced by Virginia LaCoste against SCI Alabama Funeral Services, Inc. ("SCI"), which, after the commencement of LaCoste's action, became a defendant in two class actions, namely, Williams v. Service Corp., CV-97-S-1910-S (Mobile Circuit Court), and Thrash v. SCI Funeral Service, Inc., CV-97-B-1911-S (Mobile Circuit Court), involving claims arguably encompassing those involved in LaCoste's action. I continue to adhere to the position expressed *896 in Ex parte First National Bank of Jasper, 717 So. 2d 342 (Ala.1997), which incorporated and applied the rationale of the lead opinion in Ex parte State Mutual Insurance Co., 715 So. 2d 207 (Ala.1997), and explained that § 6-5-440 does not apply to class actions. Unfortunately, the majority's ground for reversal in this present case appears to be that § 6-5-440 does not require abatement, as though § 6-5-440 did apply to class actions. Therefore, as to the rationale of today's majority opinion, I respectfully dissent.
The following statement of the majority regarding the purported effect of § 6-5-440 is particularly disturbing: "Therefore, under the plain wording of § 6-5-440, LaCoste's individual action would have provided SCI with a good defense to her continued participation in the plaintiff classes in Williams and Thrash ...." 733 So. 2d at 894. This statement is a non sequitur and inexplicable. That is so because SCI does not want, or seek, to interpose a defense to LaCoste's participation in the class actions. Quite the reverse, it seeks to interpose a defense to LaCoste's individual action. The trial court granted SCI's motion to dismiss LaCoste's individual action; hence this appeal. Indeed, in my experience on this Court I have yet to see a case in which a class-action defendant sought to exclude a putative plaintiff from the class so that the plaintiff could prosecute an individual action against that class-action defendant. The position of the majority simply flies in the face of reality.
My reasons for concurring in the judgment in this case are based on the principles I explained in my special writing in First Tennessee Bank, N.A. v. Snell, 718 So. 2d 20 (Ala.1998). The question in that case was whether a state court could enforce a judgment entered on a final settlement in a class action before it, where the state-court class action essentially duplicated an earlier-filed, federal-court class action, and where the federal court had taken no action to enjoin or stay the state-court action.
In a special writing agreeing with the majority of this Court that it could, I explained that "the courts of the United States are courts of another sovereign, over which the courts of Alabama have no supervisory control or jurisdiction." Id. at 26 (Cook, J., concurring in the result) (emphasis added). Also, I pointed out that "United States district courts, pursuant to the All Writs Act, 28 U.S.C. § 1651, readily exercise the power to enjoin competing class actions, whether ... pending in state courts or in other federal courts," 718 So. 2d at 26 (emphasis added), and that "[t]hey exercise this power regardless of the priority of filing." Id. at 26 (emphasis original). The same rationale applies to this case.
Thus, it is unnecessary for this Court to abate actions in favor of federal courts entertaining class actions. In this case, the fight should be waged in the Battle court. If that court deems an injunction necessary to protect its jurisdiction, it is fully empowered to enjoin LaCoste's action, regardless of state-court judgments. See Battle v. Liberty National Life Insurance Co., 877 F.2d 877 (11th Cir.1989) (the district court did not err in enjoining, pursuant to 28 U.S.C. § 2283, three pending state-court class actions in order to protect its jurisdiction and judgment).[1] The courts of Alabama should not presume to act on behalf of federal courts entertaining class actions when those courts, and the Battle court in particular, have indicated no interest in the matter.
If SCI wants relief, its recourse is to seek an order from the Battle court abating *897 LaCoste's state-court action. In the meantime, LaCoste's action should proceed. Thus, the trial court abused its discretion in dismissing this action. For these reasons, I concur in the judgment but dissent from the rationale.
[1] The "Anti-Injunction Act," 28 U.S.C. § 2283, provides: "A court of the United States may not grant an injunction to stay proceedings in a State court except as expressly authorized by Act of Congress, or where necessary in aid of its jurisdiction, or to protect or effectuate its judgments." (Emphasis added.) In the emphasized portion are "exceptions" to the Anti-Injunction Act that authorize "a federal court to enjoin a state court action." Battle, 877 F.2d at 882. | 64178dace7bf8ab05c1e998116c9156bf4022e2fd363ddc6a6a136bc43606f14 | 1998-11-13 00:00:00 |
05c22c24-b268-4d3f-beaa-13f69f8bb8f1 | American General Finance, Inc. v. Manley | 729 So. 2d 260 | 1970386, 1970622, 1970623 | Alabama | Alabama Supreme Court | 729 So. 2d 260 (1998)
AMERICAN GENERAL FINANCE, INC., et al.
v.
Roy L. MANLEY.
Ex parte Barbara A. Danley.
Re Barbara A. Danley
v.
American General Finance, Inc., et al.
Ex parte Orvil D. Wellington and Alice Wellington.
Re Orvil D. Wellington and Alice Wellington
v.
American General Finanace, Inc., et al.
Nos. 1970386, 1970622 and 1970623.
Supreme Court of Alabama.
November 20, 1998.
*261 Robert H. Rutherford, Carol H. Stewart, and Eric D. Franz of Burr & Forman, L.L.P., Birmingham; and Larry B. Moore of Moore & Trousdale, P.C., Florence, for American General Finance, Inc., Merit Life Insurance Company, William S. Richardson, and Angela Renee Landers.
J. Wilson Mitchell of Yates, Mitchell, Bernauer, Winborn & Morton, Florence, for Barbara A. Danley, Roy L. Manley, Orvil D. Wellington, and Alice Wellington.
PER CURIAM.
The appeal in case no. 1970386 is from a denial of the defendants' motion to compel arbitration. The defendants supported their motion by submitting a copy of the contract at issue and pertinent affidavits of an officer and an employee of the defendant American General Finance, Inc. The only opposition to that motion was an argument on behalf of the plaintiff that the arbitration clause was unenforceable for lack of mutuality.[1] That argument relied on language from the lead opinion in Northcom, Ltd. v. James, 694 So. 2d 1329 (Ala.1997). In Ex parte McNaughton, 728 So. 2d 592 (Ala.1998), this Court, referring to the pertinent language from the lead opinion in Northcom, stated: "[W]e reject this dictum from Northcom...." On the authority of McNaughton, the denial of the motion to compel arbitration is reversed, and the cause is remanded for further proceedings.
The petitions for the writ of mandamus, in case no. 1970622 and case no. 1970623, arise from actions substantially similar to the action from which the appeal in case no. 1970386 arises. In the actions that are the subjects of the mandamus petitions, the circuit court granted the defendants' motions to compel arbitration. For the reasons stated in regard to the appeal, the petitions are denied.
1970386REVERSED AND REMANDED.
1970622 and 1970623WRITS DENIED.
HOOPER, C.J., and MADDOX, HOUSTON, SEE, and LYONS, JJ., concur.
KENNEDY, J., concurs specially.
COOK, J., concurs in the result.
ALMON and SHORES, JJ., dissent, with opinion by ALMON, J.
KENNEDY, Justice (concurring specially).
In McNaughton v. United Healthcare Services, Inc., 728 So. 2d 592 (Ala.1998), a majority of this Court issued, in a case concerning arbitration, a decision from which I dissented and with which I continue to disagree. Nevertheless, the holding in that case is now recognized as the law of this state, which I am sworn to uphold. Because I agree with the majority in the present case that McNaughton controls, I concur in today's opinion. However, I stand willing to reverse the holding in McNaughton as one that does not achieve substantive justice.
ALMON, Justice (dissenting).
I dissent for the reasons stated in my dissenting opinion in Ex parte McNaughton, 728 So. 2d 592 (Ala.1998), and in my opinion in Northcom, Ltd. v. James, 694 So. 2d 1329 (Ala.1997).
SHORES, J., concurs.
[1] The plaintiff, as appellee, makes passing reference in his appellate brief to other bases on which, he argues, the denial of the motion could be upheld. These arguments have not been sufficiently preserved in the record or developed here to support an affirmance. See Spradlin v. Spradlin, 601 So. 2d 76, 78-79 (Ala.1992). | a6bc14ae072be9bb2b6193a6d0f63e057c7819876530be15ad045c9e9bfd39f8 | 1998-11-20 00:00:00 |
ce56ee16-fdfc-402a-a021-c49a7470b1ec | Ex Parte Hill | 730 So. 2d 214 | 1970769 | Alabama | Alabama Supreme Court | 730 So. 2d 214 (1998)
Ex parte Cody Renan HILL and Ginger Shaw Hill.
(Re Cody Renan Hill and Ginger Shaw Hill v. Metrospec, Inc., and Ben Hill, Jr.)
1970769.
Supreme Court of Alabama.
December 11, 1998.
*215 Jacqueline E. Austin and Paul Christian Sasser, Jr., Wetumpka, for petitioners.
J. Michael Williams, Sr., of Gullage & Williams, Auburn, for respondents.
ALMON, Justice.
Cody Hill and Ginger Hill, husband and wife, filed an action against Metrospec, Inc., and its president, Ben Hill, Jr., as well as a number of other parties. Their action related to their purchase of a home that had serious structural damage caused by an infestation of wood-boring insects. The Hills alleged breach of contract, negligent and intentional misrepresentation, suppression, negligence, conspiracy, and the tort of outrage.
After the close of discovery, the circuit court entered a summary judgment in favor of Metrospec and Ben Hill. The remaining defendants settled with the plaintiffs and obtained a general release.[1] After dismissing that portion of the case not dealt with by the summary judgment, the circuit court held that the claims against Metrospec and Ben Hill had been filed without substantial justification and awarded Metrospec and Ben Hill $8,785.70 in fees, pursuant to the Alabama Litigation Accountability Act ("ALAA").
*216 The plaintiffs appealed. The Court of Civil Appeals affirmed the summary judgment, reversed the fee award, and remanded for a finding of fact with respect to the fee award. Hill v. Metrospec, Inc., 730 So. 2d 209 (Ala. Civ.App.1997). This Court granted certiorari review. We hold that the plaintiffs' claims against Ben Hill and Metrospec alleging breach of contract, negligent misrepresentation, and negligence were supported by substantial evidence; that the fee award was an abuse of discretion; and that the issue regarding the court's jurisdiction to award such a fee is moot.
The evidence, when viewed in a light most favorable to Cody and Ginger Hill, tends to show that in December 1997 the Hills contracted to buy a pine-log home from John Anglin and Terry Anglin. The contract required the Anglins to provide a pest-inspection report in a form approved by the Veterans Administration, which was insuring the Hills' loan. During the pest inspection, Douglas Waites, a licensed pest inspector, discovered a severe infestation of wood-boring beetles in the walls of the house. Waites prepared an "Alabama Wood Infestation Report," which contained a diagram of the house. Waites testified that he placed X's on the diagram to depict the areas of infestation.
The Hills were not told about the infestation until they appeared at the real estate closing. The attorney who had prepared the sale documents was not present at the closing, and that attorney's secretary and the real-estate agent provided the Hills a rushed explanation of the various closing documents. When the Hills learned of the infestation, they demanded that a licensed contractor inspect the house to determine whether the wood-boring beetles had caused structural damage to the house. The real-estate agent then produced a letter from Metrospec, signed by Ben Hill, who was a licensed contractor and a friend of the real-estate agent (and no relation to the plaintiffs). That letter stated:
Cody and Ginger Hill were required to initial a number of documents, including the letter from Ben Hill. Relying on the Metrospec report, the Hills proceeded with the closing. After the closing, the Hills encountered a number of problems with the house, including structural damage from wood-boring insects.
Before considering whether there is a conflict among the cases with respect to a circuit court's jurisdiction to consider a fee award under the ALAA, the Court must determine whether Cody and Ginger Hill presented substantial evidence tending to prove that Ben Hill and Metrospec breached a contract with the Hills, conducted a negligent inspection, negligently or intentionally misrepresented that the house had no structural damage, suppressed the fact that there was structural damage, engaged in a conspiracy, or committed the tort of outrage. The Court of Civil Appeals questioned whether Ben Hill and Metrospec had any legal duty to the Hills, given that Metrospec had been retained by the real-estate agent and the sellers. That court then concluded that, even if there was such a duty, there was no evidence that the inspection conducted by Ben Hill and Metrospec was deficient:
Hill v. Metrospec, 730 So. 2d at 212.
*217 The Court of Civil Appeals reasoned that there was no negligence because (a) Metrospec was retained to inspect the areas marked by X's on the Alabama Wood Infestation Report, and (b) Ben Hill had, in fact, inspected the three designated areas and correctly found no structural damage in those areas. Id.
A home buyer may prove that a pest inspector hired by the seller, or by the seller's real-estate agent, has a duty to the buyer to use reasonable care in the inspection, where the buyer shows that the inspector knew the purpose of the inspection and knew that his "letter of clearance" would be presented to, and was for the benefit of, the buyer. Savage v. Wright, 439 So. 2d 120, 123 (Ala.1983). We see no reason that the rationale in Savage should not apply to a structural inspection by a licensed contractor. Moreover, in this type of situation, the Hills could be found to be third-party beneficiaries of the contract between the real-estate agent and the sellers, on the one hand, and Metrospec, on the other. See Rumford v. Valley Pest Control, Inc., 629 So. 2d 623 (Ala.1993).
Douglas Waites, the pest inspector, testified by deposition that the X's on his diagram indicated an infestation in the walls of the house and not in the crawl space underneath the house. Ben Hill inspected only the crawl space of the house because, he stated, he thought the X's indicated an infestation in the crawl space.
Ben Hill testified that when he conducts a structural inspection he tries to find evidence of the infestation the original pest inspector found and noted on the Alabama Wood Infestation Report. A jury could reasonably conclude that when Ben Hill did not find evidence of an infestation in the crawl space or in the flooring system, he was put on notice that either the diagram was inaccurate or he had misinterpreted the diagram, and that Ben Hill should have either expanded his inspection or contacted Waites to determine the true area of infestation. A jury could find that Ben Hill's failure to do either of these things constituted a breach of a duty he and Metrospec owed to Cody and Ginger Hill to use reasonable care in inspecting the home for structural damage.
Cody and Ginger Hill presented substantial evidence requiring that the negligence claim be submitted to the jury. The same evidence supports the Hills' claims alleging breach of contract and negligent misrepresentation. The Court of Civil Appeals failed to view this evidence in the light most favorable to the Hills and failed to resolve all reasonable doubts against Metrospec and Ben Hill. Its affirmance of the summary judgment on these three counts conflicts with Hanners v. Balfour Guthrie, Inc., 564 So. 2d 412 (Ala.1990), and we must reverse the judgment as it relates to the negligence, breach-of-contract, and negligent-misrepresentation claims. We agree, however, that Cody and Ginger Hill did not present substantial evidence tending to prove that Ben Hill and Metrospec had known of the structural damage in the walls or intentionally inspected the wrong area of the house in a concerted effort to mislead the Hills. The summary judgment, as it relates to the outrage claim, the conspiracy claim, the suppression claim, and the intentional-misrepresentation claim, is due to be affirmed.
Ben Hill and Metrospec argue that the Court of Civil Appeals erred by reversing the award of attorney fees made pursuant to the ALAA, § 12-19-272, Ala.Code 1975, and remanding the cause for a finding of fact with respect to the fee award. Cody and Ginger Hill argue that the circuit court failed to preserve its jurisdiction to award such a fee after entering the summary judgment. See Donnell Trucking Co. v. Shows, 659 So. 2d 667 (Ala.Civ.App.1995). It is implicit in our partial reversal of the summary judgment that we find Cody and Ginger Hill had substantial justification for naming Ben Hill and Metrospec as defendants in this action and that the circuit court abused its discretion in awarding a fee under the ALAA to Metrospec and Ben Hill. We need not address the issue of the circuit court's jurisdiction to award such a fee, because the issue is now moot.
The judgment of the Court of Civil Appeals affirming the summary judgment is *218 reversed as to Cody and Ginger Hill's negligence, breach-of-contract, and negligent-misrepresentation claims. The Court of Civil Appeals' judgment is affirmed insofar as it affirmed the summary judgment as to the suppression, intentional-misrepresentation, conspiracy, and outrage claims. The Court of Civil Appeals' reversal of the award of an attorney fee under the ALAA is affirmed, for the reasons stated above; that court's judgment is reversed to the extent that it remanded the case for further proceedings under the ALAA. Metrospec and Ben Hill's request that this Court award an attorney fee for their having to defend a "frivolous" appeal is not well taken and is denied. We pretermit discussion of the issue regarding the circuit court's jurisdiction to award a fee under the ALAA, because that issue is moot.
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.
HOOPER, C.J., and MADDOX, SHORES, HOUSTON, KENNEDY, COOK, and LYONS, JJ., concur.
[1] Metrospec and Ben Hill argue that the general release inures to their benefit; that the plaintiffs have no standing to appeal; and thus that Ben Hill and Metrospec are entitled to fees for the Hills' filing a "frivolous" appeal. Metrospec relies on Baker v. Ball, 473 So. 2d 1031 (Ala.1985), one of a line of cases that this Court expressly overruled in Ford Motor Co. v. Neese, 572 So. 2d 1255, 1256-57 (Ala.1990). Metrospec and Ben Hill have failed to produce substantial evidence indicating that the parties to the general release intended to release Metrospec and Ben Hill as well. | 57b66b3ef44ade9a135a598a2fd6eb9e2360621cfbd51c05cd68264cd1bdb430 | 1998-12-11 00:00:00 |
19b4e589-86aa-4f03-85d0-be81d1dd83b8 | Kmart Corp. v. Kyles | 723 So. 2d 572 | 1961790 | Alabama | Alabama Supreme Court | 723 So. 2d 572 (1998)
KMART CORPORATION and Ray Jones
v.
Joyce KYLES.
1961790
Supreme Court of Alabama.
May 22, 1998.
Opinion on Return to Remand October 30, 1998.
Rehearing Denied February 26, 1999.
*573 David F. Daniell of Richardson, Daniell, Spear & Upton, P.C., Mobile, for appellants.
Daniel B. Feldman of Hammond, Feldman & Lehane, P.C., Birmingham; James R. Morgan, Birmingham; and Mark D. McKnight, Birmingham, for appellee.
LYONS, Justice.
Joyce Kyles sued Kmart Corporation and a former employee of Kmart, Ray Jones, alleging malicious prosecution. After two mistrials in which the juries could not reach a unanimous verdict, the jury in a third trial returned a verdict in favor of Kyles, awarding her $100,000 in compensatory damages and $100,000 in punitive damages. The trial court denied the defendants' motion for a judgment as a matter of law,[1] a new trial, or a remittitur of damages. The defendants appeal from a judgment entered on the jury verdict. We affirm conditionally.
The parties to this appeal disagree on many important facts. However, because this appeal is from the trial court's denial of a motion for a judgment as a matter of law or a new trial, we are bound to view the evidence in a light most favorable to the nonmovant. Motion Industries, Inc. v. Pate, 678 So. 2d 724 (Ala.1996); King Motor Co. v. Wilson, 612 So. 2d 1153 (Ala.1992). Accordingly, where the evidence in the record is disputed, we present it in a light most favorable to Kyles.
One day in August 1989, a check-out supervisor at a Kmart store in the Mobile area saw two persons loading lawn chairs from the front of the store into the bed of a small red pickup truck that looked as if it had a white camper shell over the bed of the truck.[2] The supervisor determined that the lawn chairs had not been paid for and proceeded to inform Ray Jones, the store's loss control manager. Jones, who was also a Mobile County constable, saw a male and a female loading *574 lawn chairs into the pickup truck. He approached the truck as it began to drive away, but the driver evaded him and the vehicle departed from the store. Jones followed in his own automobile, which bore the insignia of a constable's vehicle. Eventually, the truck pulled over and Jones questioned the driver, a woman, about the lawn chairs. He asked to see a receipt for the chairs, but the driver could not produce one. Jones then asked the driver for her driver's license. The driver showed Jones that she had a license, but did not give it to him. Jones contends that he saw the name "Kyles" on the license. Jones told the woman that she needed to follow him back to the Kmart store because the chairs had not been paid for. The woman responded by telling her male passenger to get out of the truck and unload the lawn chairs, and the man unloaded most of the chairs. The pickup truck then drove off, while Jones remained at the scene to collect the lawn chairs. Jones contends he wrote down the license plate number of the truck before it left and that the license plate was for a pickup truck registered to Robert Kyles.
Jones reported the alleged offense to the Mobile County Sheriff's Department a few days later, on August 15, 1989. The report contains a description of the female suspect that is similar to Kyles. However, the report listed the suspect as "unknown," rather than as a woman with the last name Kyles. The sheriff's department report also contains the following narrative written by a sheriff's deputy:
One evening a few days later, Jones drove to Joyce Kyles's home in St. Elmo. He wore his constable's uniform and sidearm and was accompanied by another constable. He asked to see "Mrs. Kyles, the wife of Robert Kyles who drives a red truck." Kyles was sitting with her family in the front yard of their home at the time, and she identified herself to Jones. Jones then told Kyles that she needed to go to the Kmart store to pay for the lawn chairs she had stolen. Kyles told Jones that she had not been in a Kmart store recently, had not stolen any lawn chairs, that Jones had never spoken to her before, and that she did not know what he was talking about. Jones responded by cursing at Kyles; then Kyles told him to leave, and he did.
Although Robert Kyles owned a red Nissan pickup truck at that time, it did not have a white camper shell. Instead, the truck had a roll bar and had a plywood cover over the bed of the truck that could hinge open in order for items to be placed in the bed.
Jones drove to the office of the Mobile County Sheriff's Department and met with a detective. Shortly thereafter, two sheriff's deputies, not accompanied by Jones, drove to Kyles's residence and asked if they could search the property for the lawn chairs that Jones had accused her of stealing. Kyles allowed the deputies to search her home and yard, but they did not find the chairs and left the premises.
On August 21, 1989, Jones executed an affidavit in support of an arrest warrant for Kyles. Jones's affidavit stated that Kyles and an unknown man had stolen 19 lawn chairs from Kmart and had put them in a small red pickup truck, but had thrown 14 of the chairs out of the truck after he had stopped it.
No action was taken by the sheriff's department in relation to the arrest warrant for Kyles until a day in March 1992, when she was stopped by police officers as part of a routine stop of traffic to check for driver's licenses. When one of the officers ran a computer check on her license number, he learned of the outstanding warrant and arrested her. Kyles was then transported by a sheriff's department vehicle to the county *575 jail. At the jail, Kyles was processed and fingerprinted, and she learned that she had been arrested because of the warrant Jones had sworn out for her arrest. Kyles telephoned her husband, who went to the jail and obtained her release on bond. Kyles had spent nearly three hours in the jail.
After a preliminary hearing, the district court found probable cause to support Kyles's arrest on the felony charge of theft of property in the second degree and sent the matter to the grand jury. However, the grand jury eventually "no-billed" the charge. Kyles spent $3,900 in attorney fees defending the criminal charge. She then filed this civil action against Kmart and Jones. As noted above, this case has been tried three times, with the jury finally reaching a unanimous verdict in favor of Kyles after two mistrials. On this appeal by Kmart and Jones, our review is limited to the testimony and evidence presented to the jury in the third trial.
Kmart and Jones raise several issues relating to the trial court's denial of their motion for a judgment as a matter of law, a new trial, or a remittitur of damages: (1) Did the trial court err in refusing to grant the defendants a new trial based on the defendant's claim that the trial court itself improperly questioned Jones regarding his powers as a constable and by doing so prejudiced the jury against him? (2) Did the plaintiff present sufficient evidence in support of her claim of malicious prosecution to rebut the defendants' prima facie showing of probable cause? (3) Did the trial court err in denying the defendants' motion to remit the compensatory damages award? (4) Did the trial court err in submitting the issue of punitive damages to the jury, and, if not, did the trial court err in denying the defendants' motion to remit the punitive damages award?
Kmart and Jones argue that they should receive a new trial because, they say, during trial the judge questioned Jones regarding his powers as a constable and questioned him in such a manner as to prejudice the jury against the defendants. On this basis, they argue that the trial court erred in denying their motion for a mistrial and their subsequent motion for a new trial. Although the defendants acknowledge that Rule 614, Ala. R. Evid., allows a trial judge to interrogate any witness, they contend that the trial judge's action here was improper because, they say, the manner in which the judge questioned Jones left the jury with the perception that Jones, as a constable, had the power to arrest the two people in the truck for theft and escape, and in not doing so failed in his duties as a constable. The defendants further argue that the manner in which the trial judge questioned Jones left the jury with the impression that the judge did not believe Jones's testimony, and they argue that the problem was compounded by Kyles's counsel's later noting that possibility to the jury in closing arguments. Kmart and Jones note that during deliberations the jury sent a question to the judge asking whether the "constable issue" was a law issue or a fact issue, and that the judge informed them that it was a fact issue that he could not comment on. The defendants say that it is clear that the judge's questioning of Jones prejudiced Jones and Kmart in the eyes of the jury, and they argue that the trial court should have granted either their motion for a mistrial or their motion for a new trial.
In response, Kyles first notes that the trial judge has not only the right but the duty to ask questions of a witness necessary to prevent the jury from misunderstanding the evidence. Then she says that the fact that the answers given to the judge's questioning may be perceived as more favorable to one party than the other does not render the questioning improper. Kyles contends that the judge's questions to Jones were not improper because, she says, they were asked merely to elicit a clarification of certain facts, they were not asked in an adversarial manner, and in asking them the judge was not acting as an advocate for one side. She notes that after the trial judge denied the defendants' motion for a mistrial, the judge offered to give the jury a curative instruction regarding the questioning but that the defendants declined the offer. Kyles argues that the trial court *576 did not err in denying the defendants' motion for a mistrial or their motion for a new trial.
Rule 614 of the Alabama Rules of Evidence states:
(Emphasis added.) Rule 614 expresses the law as it existed in Alabama before the adoption of the Rules of Evidence: that it is within the power of the trial court to propound questions to witnesses, and it is the duty of the court to do so if justice requires, so long as the court does not depart from the standard of fairness and impartiality. Affiliated FM Ins. Co. v. Stephens Enterprises, 641 So. 2d 780 (Ala.1994); Stroud v. State, 592 So. 2d 653 (Ala.Cr.App.1991); Matter of Wilson, 431 So. 2d 552 (Ala.Civ.App.1983). See, also, Advisory Committee's Notes to Rule 614.
The defendants' counsel was the first to inform the jury that Jones had been a constable as well as a Kmart employee. He informed them of that fact during his opening statement. Thereafter, Jones's status as a constable, and the powers of that elected officer, were at issue in the trial. The trial judge asked several questions relating to what other actions Jones could have taken as a constable when faced with the situation Jones had explained in his testimony. We conclude that, under the facts of this case and the circumstances of this trial, the questions were not unfair to the defendants and that the trial judge did not abuse his discretion in asking the questions. The trial court did not err in questioning Jones.
Kmart and Jones argue that the trial court erred in denying their motion for a judgment as a matter of law because, they say, the plaintiff failed to present sufficient evidence in support of her claim for malicious prosecution to rebut their prima facie showing that her arrest was supported by a finding of probable cause. They note that in the felony theft case against Kyles, which underlies her malicious prosecution claim, the district court made an express finding of probable cause and sent the case to the grand jury. Kmart and Jones further contend that Kyles failed to present substantial evidence that they had acted with malice in instigating the criminal charges against her, one of the necessary elements of a malicious prosecution claim. In sum, the defendants argue that Kyles failed to present sufficient evidence for the trial court to submit her claim to the jury.
In response, Kyles argues that she did present sufficient evidence to rebut the defendants' prima facie showing of probable cause for her arrest. Kyles contends that she presented evidence indicating that the defendants' showing of probable cause was based on perjury, fraud, false testimony, or other misconduct. She says that the evidence at trial indicated that her arrest was based solely on Jones's identifying her as the person who stole the lawn chairs, and she notes that on Jones's initial report to the sheriff's department he identified the suspect as someone "unknown," even though he stated that he had seen her driver's license when he stopped the pickup truck. Kyles claims that Jones admitted during the trial that at the preliminary hearing on her criminal charge he had given false testimony to promote her prosecution. Kyles also claims that Jones did not report the theft of lawn chairs to the sheriff's department until several days after the crime; she says this delay allowed Jones time to find a residence with a small red pickup truck, to obtain the vehicle's license number, and then to report that number as the license number of the truck used to steal the lawn chairs. In other words, Kyles argues that Jones fabricated his testimony against her in order to claim he had caught the person who had stolen the lawn chairs.
*577 In order for a claim for malicious prosecution to be submitted to a jury, the trial court must find that the plaintiff has presented substantial evidence of the following elements: (1) that a prior judicial proceeding was instituted by the present defendant, (2) that in that prior proceeding the present defendant acted without probable cause and with malice, (3) that the prior proceeding ended in favor of the present plaintiff, and (4) that the present plaintiff was damaged as a result of the prior proceeding. Fina Oil & Chemical Co. v. Hood, 621 So. 2d 253 (Ala.1993); Delchamps, Inc. v. Larry, 613 So. 2d 1235 (Ala.1992). Viewing the evidence in a light most favorable to Kyles, as we must, given that as to the request for a judgment as a matter of law or a new trial she was the nonmovant, we conclude that the trial court did not err in submitting the malicious prosecution claim to the jury and that a reasonable jury could have concluded that Kyles had met her burden of proof. The first, third, and fourth elements noted above are undisputed. We note certain inconsistencies between Jones's testimony at the preliminary hearing, where the district court judge made a finding of probable cause, and at the trial of this action; those inconsistencies, considered with other evidence presented by Kyles, constitute substantial evidence indicating that in seeking Kyles's arrest the defendants acted without probable cause and with malice. At the trial, Jones admitted that at the preliminary hearing he had given false testimony with regard to a number of facts that were critical in establishing the connection between Kyles and the alleged theft.
Kmart and Jones argue that the jury's $100,000 compensatory damages award is not supported by the evidence. They say that Kyles's testimony as to the harm she suffered was limited to the facts that she was arrested, that she spent a few hours in jail, and that she had to pay approximately $4,000 in attorney fees and to secure a bail bond. They say that Jones presented no evidence of mental anguish or suffering caused by those events, such as medical expenses or sleeplessness, worry, or other psychological injury. They contend that Kyles's trial counsel made a tactical decision to limit the kind of testimony that had opened up Kyles to impeachment evidence on cross-examination in the earlier two trials. Thus, Kmart and Jones say that there is no evidence to support an award of compensatory damages to Kyles in excess of $4,000 and that the trial court should have either remitted the compensatory damages award or granted their motion for a new trial.
In response, Kyles argues that the jury's compensatory damages award is reasonable and is rationally related to the evidence she presented at trial. She says that in addition to the sums she paid for attorney fees and a bail bond, she presented evidence that she had been subjected to an unannounced and potentially violent confrontation by two armed constables who, in front of her family and friends, accused her of theft; that she was forced to undergo a search of her residence by two sheriff's deputies; that during a routine traffic stop two years later she was arrested and then jailed on a false charge; and that she had to go through a grand jury hearing before the charge was dismissed. She contends that these events were undoubtedly traumatic and that she suffered great emotional distress as a natural consequence. Kyles says that the jury found she had suffered mental anguish and that this Court has recognized that an award of damages for mental anguish is within the sound discretion of the jury.
After thoroughly reviewing the trial record, we conclude that the defendants are correct in their assertion that Kyles failed to present evidence of mental anguish or psychological injury sufficient to support the jury's award of $100,000 in compensatory damages. Although Kyles presented substantial evidence indicating that certain events occurred, i.e., her questioning by Jones and the sheriff's deputies, her arrest, and her nearly three hours' incarceration, she presented no testimony or other evidence indicating that those events caused her to suffer great mental anguish. The only evidence of Kyles's alleged mental suffering was her husband's testimony that she cried on *578 one occasionwhen she telephoned him to say that she had been arrested.
Under Alabama law, the presence of physical injury or physical symptoms is not a prerequisite for a claim for damages for mental anguish. Alabama Power Co. v. Harmon, 483 So. 2d 386 (Ala.1986). "The plaintiff is only required to present some evidence of mental anguish, and once the plaintiff has done so, the question of damages for mental anguish is for the jury." Harmon, 483 So. 2d at 389. The amount of the jury's award is left to the jury's sound discretion, and the jury's award will not be set aside absent a clear abuse of discretion. Id. Also, a jury's verdict is presumed correct, and that presumption is strengthened by the trial court's denial of a motion for new trial. Id. But, here we must address the strength of the presumption in light of the plaintiff's failure to testify about the nature of her alleged mental anguish.
At the turn of the century, the form of proof of mental anguish was indirect. For example, in Western Union Telegraph Co. v. McMorris, 158 Ala. 563, 573, 48 So. 349, 353 (1908), the Court held:
(Citations omitted.)
McMorris stated the law in an era during which it was not permissible for a witness to give testimony as to his or her own mental anguish. This principle was based on the general rule prohibiting testimony by a witness as to his uncommunicated mental intent or state of mind. The rule that allowed an inference of suffering from simply a description of the circumstances is understandable, because there was no direct method of proof by testimony of the victim.
The rule excluding testimony about one's own mental anguish in Alabama has evolved in a line of cases reviewed in Hardie v. State, 260 Ala. 75, 68 So. 2d 35 (1953). There the Court referred to the early case of Stewart v. State, 78 Ala. 436, 437 (1885), barring testimony of a witness that he "was in a fright," and noting that while Stewart was frequently followed in ensuing cases, in most of the cases following it the excluded testimony had to do with a witness's motive or intent rather than the witnesses's emotional state.
The turning point occurred in Alabama Power Co. v. Edwards, 219 Ala. 162, 166, 121 So. 543, 546 (1929), where a witness was permitted to testify "I was scared." After discussing Stewart and Edwards, the Hardie Court then discusses Ingram v. State, 252 Ala. 497, 500, 42 So. 2d 36, 38 (1949), where testimony as to a witness's fear was found admissible for the reason that the emotion of fear is an "involuntary physical effect" and "for that reason it is different from the mere voluntary mental action of entertaining a motive or intention which was not communicated or otherwise expressed." 260 Ala. at 80, 68 So. 2d at 39.
We now clearly allow the testimony of a witness as to his or her mental anguish. The question thus remains, in the present era, when we permit a witness to offer evidence as to the witness's own mental anguish, is indirect evidence of mental anguish alone sufficient to support a substantial verdict? We answer this question in the negative. We give stricter scrutiny to an award of mental anguish where the victim has offered little or no direct evidence concerning the degree of suffering he or she has experienced. See Foster v. Life Ins. Co. of Georgia, 656 So. 2d 333, 337 (Ala.1994), where the Court stated:
Unlike the plaintiff in the instant case, the plaintiff in Foster at least testified to the issue of mental anguish by saying that the discovery of the fraud affected her "a lot." See, also, Sears, Roebuck & Co. v. Harris, 630 So. 2d 1018, 1033 (Ala.1993), cert. denied, 511 U.S. 1128, 114 S. Ct. 2135, 128 L. Ed. 2d 865 (1994), where the Court reduced a mental anguish verdict from $750,000 to $1 in a setting where the victim of the mental anguish did not testify.
The plaintiff here did not testify about her mental anguish in this trial. There were two prior hung juries leading to mistrials in this case. In the earlier trials, the plaintiff had testified that she "went crazy"; that she was too embarrassed to shop, even when she had money in her pocket, for fear of being accused again of shoplifting; and that she had attempted suicide three times and had sought help at a psychiatric hospital. On this third trial, the plaintiff apparently had good reason not to subject herself to further cross-examination on the extent of her mental anguish, because of evidence of a prior arrest and incarceration that was successfully exploited in the two earlier trials. Thus, in light of the paucity of evidence presented by the plaintiff in this case, we conclude that the jury abused its discretion in awarding her $100,000 in compensatory damages.[3] Kyles presented evidence that she paid approximately $4,000 in attorney fees to defend the criminal action. Thus, we conclude the jury awarded more than $90,000 for mental anguish damages even though Kyles presented no evidence of severe mental anguish. We believe that the greatest amount of compensatory damages a jury, using sound discretion, could have awarded Kyles is $15,000. Accordingly, we conclude that the trial court erred in denying the defendants' motion for a remittitur of damages or a new trial. If the plaintiff does not accept a remittitur of the compensatory damages award from $100,000 to the sum of $15,000, the defendants must be granted a new trial.
Kmart and Jones next argue that the trial court erred in denying their motion for a judgment as a matter of law as to punitive damages and in denying their motion for a judgment as a matter of law, a new trial, or a remittitur of the punitive damages. They note that the purpose of punitive damages is to punish a wrongdoer, and they say that they did nothing wrong in making a criminal complaint against Kyles. They say that it is not their fault that the arrest warrant was not served on Kyles for more than two years, or that during the years before Kyles's malicious prosecution action went to trial one of the employee witnesses died and the Kmart store was closed. They note that the district judge made a finding of probable cause that supports Kyles's arrest, and they argue that the fact that the grand jury no-billed the matter does not mean that they had acted with malice in seeking Kyles's prosecution. In sum, Kmart and Jones argue that Kyles failed to present clear and convincing evidence of malice or wantonness, which is necessary to support an award of punitive damages. However, they also argue that even if it can be said that an award of punitive damages could be warranted, the award in this case is excessive.
*580 In response, Kyles argues that an award of punitive damages was warranted and that the $100,000 award is not excessive in comparison to the $100,000 compensatory damages award. She contends that Jones lied under oath to further her prosecution and that his doing so is proof that Kmart and Jones acted maliciously toward her, and, therefore, she contends, punitive damages are warranted. Kyles then argues that the award is not excessive because, she says, the reprehensibility of the defendants' conduct was great, the ratio of punitive to compensatory damages is only 1:1, and the penalty for perjury, which she says Jones committed, is punishable by both fines and imprisonment. In sum, she argues that the amount of the punitive damages award must be taken as reasonable when reviewed under the guidelines set out in BMW of North America, Inc. v. Gore, 517 U.S. 559, 116 S. Ct. 1589, 134 L. Ed. 2d 809 (1996).
Viewing the evidence in a light most favorable to Kyles, as we must, given that as to the judgment as a matter of law and new trial motions she was the nonmovant, we conclude that she presented substantial evidence indicating that the defendants acted with malice in pursuing the criminal charge against her. Thus, the trial court properly submitted the issue of punitive damages to the jury and properly denied the defendants' motion for a judgment as a matter of law as to the issue of punitive damages. However, we have ruled that Kyles should accept a remittitur of her compensatory damages award to $15,000, or else the defendants shall receive a new trial; if Kyles accepts that remittitur, then the ratio of punitive to compensatory damages will no longer be 1:1. Accordingly, if Kyles accepts a remittitur of the compensatory damages award, we believe it necessary for the trial court to hold a new Hammond[4] hearing on the question of excessiveness of the punitive damages award.
The trial court's order denying the defendants' motion for a new trial is affirmed on the condition that the plaintiff file with this Court within 21 days a remittitur of compensatory damages to the sum of $15,000; otherwise, the judgment will be reversed and this cause remanded for a new trial. The trial court's order denying the defendants' motion for a judgment as a matter of law as to the issue of punitive damages is affirmed; however, if the plaintiff accepts a remittitur of compensatory damages, then the trial court is to hold a new Hammond hearing and to make a return to this Court within 60 days of the date of the filing of the remittitur.
AFFIRMED CONDITIONALLY AS TO THE COMPENSATORY AWARD; REMANDED CONDITIONALLY FOR A NEW HEARING AS TO THE PUNITIVE AWARD.
HOOPER, C.J., and MADDOX, SHORES, HOUSTON, KENNEDY, and SEE, JJ., concur.
ALMON and COOK, JJ., concur in part and dissent in part.
ALMON, Justice (concurring in part and dissenting in part).
I agree that the plaintiff, Joyce Kyles, presented sufficient evidence of malicious prosecution to submit the claim to the jury, and that the circuit court correctly denied the motion by the defendants, Kmart Corporation and Ray Jones, for a judgment as a matter of law. I dissent from the decision to condition an affirmance of the denial of the defendants' motion for a new trial on the plaintiff's accepting a remittitur of $85,000 of the compensatory damages awarded by the jury and the circuit court.
The majority opinion emphasizes the fact that Kyles did not give direct testimony as to her mental anguish. However, I would hold that the circuit court properly concluded that the evidence allowed the jury to infer that Kyles had suffered significant mental anguish that was caused by the defendants' tortious conduct. The evidence showed that, while she was in her yard, with family and friends present, armed constables accused her of theft; that sheriff's deputies searched her house and yard; and that she was arrested more than two years later based on the *581 same accusation of theft. The jury found that the accusation of theft was false, even that it was maliciously contrived by Jones while he was acting as an agent of Kmart. In my judgment, this evidence would support a verdict of significantly more than $15,000 in compensatory damages, and I see no basis for interfering with the jury's verdict, particularly since the presumption in favor of that verdict has been strengthened by the circuit court's decision not to set it aside and not to order a remittitur.
Because I would not order a remittitur of the compensatory damages, I would not send the cause back for any further proceedings on the question of punitive damages. The culpability as found by the jury was great, and the jury awarded punitive damages and compensatory damages in a one-to-one ratio.
I see no error in the circuit court's denial of the defendants' motion for a remittitur or a new trial. I would simply affirm the judgment.
COOK, J., concurs.
LYONS, Justice.
The defendants, Kmart Corporation and Ray Jones, appealed from a judgment entered in favor of the plaintiff, Joyce Kyles. Kyles had sued Kmart and Jones, alleging malicious prosecution; a jury awarded Kyles $100,000 in compensatory damages and $100,000 in punitive damages. The trial court entered a judgment on that verdict. This Court affirmed the judgment as to the compensatory damages award, on the condition that Kyles file with this Court a remittitur of compensatory damages to the sum of $15,000. See Kmart Corp. v. Kyles, 723 So. 2d 572 (Ala.1998). In addition, we affirmed the trial court's order denying the defendants' motion for a judgment as a matter of law as to the punitive damages award, but remanded the cause conditionally with instructions for the trial court to hold a new hearing on the question of excessiveness of the punitive damages award if the plaintiff accepted the remittitur of compensatory damages. Id. The plaintiff filed her remittitur on June 11, 1998. Pursuant to our instructions, the trial court, on July 16, 1998, on remand, held a hearing pursuant to Hammond v. City of Gadsden, 493 So. 2d 1374 (Ala.1986), and Green Oil Co. v. Hornsby, 539 So. 2d 218 (Ala.1989). The trial court reaffirmed the earlier punitive award of $100,000. The trial court made its return to this Court on August 10, 1998. The only issue now before us is whether the punitive damages award of $100,000 is excessive. Kmart and Jones contend it is.
The trial court entered the following thorough and well-reasoned order:
We need add nothing to the trial court's analysis of the BMW and Hammond /Green Oil factors in this case. After reviewing that analysis, we agree that, based on the level of reprehensibility of the misconduct evidenced in this case, a $100,000 punitive damages award is sufficient to punish Kmart and Jones and to deter them from further misconduct, without compromising their due process rights. The punitive damages award of $100,000 is hereby affirmed.
AFFIRMED.
HOOPER, C.J., and MADDOX, ALMON, SHORES, HOUSTON, KENNEDY, COOK, and SEE, JJ., concur.
[1] Effective October 1, 1995, Rule 50, Ala. R. Civ. P., was amended to rename motions for directed verdict and motions for judgment notwithstanding the verdict as motions for judgment as a matter of law. Rather than continue to use the terminology of the former rule that appears in the briefs and the record in this proceeding, we will use the terms adopted in the amended rule.
[2] The Kmart store at which the event occurred is now closed, and its records are unavailable. Thus, the exact date on which the theft of the lawn chairs occurred cannot be determined.
[3] This Court has previously ordered a remittitur of compensatory damages where it was clear that the plaintiff failed to present sufficient evidence to support the award and that the jury abused its discretion in making that award. See Sears, Roebuck & Co. v. Harris, 630 So. 2d 1018 (Ala. 1993), cert. denied, 511 U.S. 1128, 114 S. Ct. 2135, 128 L. Ed. 2d 865 (1994); Crosby v. Avon Products, Inc., 474 So. 2d 642 (Ala.1985); Coca-Cola Bottling Co., Montgomery v. Parker, 451 So. 2d 786 (Ala.1984).
[4] Hammond v. City of Gadsden, 493 So. 2d 1374 (Ala.1986). | d0f2dc2792f1ce2a0ed8a3a1f7ec0367b92210f102ea6ef905de337d260c559c | 1998-10-30 00:00:00 |
547b06d5-86ff-4c6b-9f72-d675ff6c27e4 | DeKalb County LP Gas Co., Inc. v. Suburban Gas, Inc. | 729 So. 2d 270 | 1971443, 1971532 | Alabama | Alabama Supreme Court | 729 So. 2d 270 (1998)
DeKALB COUNTY LP GAS COMPANY, INC.
v.
SUBURBAN GAS, INC., et al.
Coosa Valley Electric Cooperative, Inc., and Coosa Valley Propane Services, Inc.
v.
Suburban Gas, Inc., et al.
Nos. 1971443 and 1971532.
Supreme Court of Alabama.
November 25, 1998.
Applications for Rehearing Denied January 15, 1999.
*271 Frank M. Bainbridge and Bruce F. Rogers of Bainbridge, Mims, Rogers & Smith, L.L.P., Birmingham; and George C. Douglas, Jr., Birmingham, for appellant DeKalb County LP Gas Co., Inc.
Ronald G. Davenport and Christopher S. Simmons of Rushton, Stakely, Johnston & Garrett, P.A., Montgomery; William C. Sullivan of Love, Love & Love, Talladega; and James W. Fuhrmeister of Allison, May, Alvis & Fuhrmeister, Birmingham, for appellants Coosa Valley Electric Cooperative, Inc., and Coosa Valley Propane Services, Inc.
Charles M. Crook of Balch & Bingham, L.L.P., Montgomery; Jon Terry of Bains & Terry, Bessemer; and Hewitt L. Conwill of Conwill & Justice, Columbiana, for appellee.
Mark D. Wilkerson and Amanda C. Carter of Brantley & Wilkerson, P.C., Montgomery; and Cecil Caine, Moulton, for amicus curiae Wheeler Basin Natural Gas Company, Inc., in support of the appellants.
HOUSTON, Justice.
These appeals present several issues. Specifically, the facts raise questions concerning (1) the applicability of the Alabama Administrative Procedure Act, Ala.Code 1975, § 41-22-1 et seq.; (2) standing; and (3) the proper interpretation of Ala.Code 1975, § 37-6-1 et seq., governing the establishment and operation of electric cooperatives.
*272 Coosa Valley Electric Cooperative, Inc. ("Coosa Electric"), is a special-purpose corporation that is, without question, a statutory creature. Formed under the provisions of what are now §§ 37-6-1 to 37-6-49 of the Alabama Code, Coosa Electric has provided electric service to its members since 1939. However, in 1996, Coosa Electric decided to get into the business of distributing propane gas. To that end, Coosa Electric incorporated Coosa Valley Propane Services, Inc. ("Coosa Propane"), in April of that year. Coosa Electric's officers and directors also served as the officers and directors of Coosa Propane. In September 1996, after Coosa Electric's members had approved the venture into the propane business, Coosa Propane purchased 100% of the stock of DeKalb County LP Gas Company, Inc. ("DeKalb Gas"). The purchase of DeKalb Gas meant that Coosa Propane did not need to acquire from the LP Gas Board a new LP gas permit, because DeKalb Gas already had a permit as an existing propane provider. After the purchase, the same officers and directors that served Coosa Electric and Coosa Propane were made officers and directors of DeKalb Gas.
In November 1996, a group of propane dealers in competition with DeKalb Gas ("Propane Dealers") filed an action in the Shelby County Circuit Court against Coosa Electric, Coosa Propane, and DeKalb Gas, requesting declaratory and injunctive relief based primarily on Blue Cross & Blue Shield v. Protective Life Ins. Co., 527 So. 2d 125 (Ala.Civ.App.1987). The Propane Dealers argued that Coosa Electric, as a corporation formed under § 37-6-1 et seq., was prohibited from entering into the propane business because, they said, such a venture would be outside the scope of its enabling statute. Coosa Electric claimed that, although it was organized for a specific purpose, it was nonetheless given broad power by the legislature to acquire any amount of stock in other businesses, even if those businesses had been organized for a different purpose. In March 1998, the trial court entered a summary judgment for the Propane Dealers, holding that Coosa Electric's involvement in the propane business was unlawful. The trial court's judgment also permanently enjoined Coosa Electric from engaging in the propane business, and it directed Coosa Electric to divest itself of majority control in DeKalb Gas; that is, Coosa Electric was prohibited from holding more than 49% of the DeKalb Gas stock. Coosa Electric, Coosa Propane, and DeKalb Gas appealed. We reverse and remand.
The appellants raise three main issues: (1) Whether the Alabama Administrative Procedure Act ("AAPA") applies to these facts; (2) whether the Propane Dealers had standing to sue; and (3) whether the powers of stock acquisition under § 37-6-3(9) allow Coosa Electric to own 100% of DeKalb Gas, when propane services are not listed among the purposes of cooperatives in § 37-6-2.
Because there are no genuine issues of material fact, the summary judgment is appropriate only if the Propane Dealers were entitled to a judgment as a matter of law. Rule 56(c), Ala. R. Civ. P.; Wright v. Wright, 654 So. 2d 542, 543 (Ala.1995). The question to be answered, then, is whether the trial court correctly decided the three issues above as a matter of law.
The appellants argue that this case is governed by the AAPA and, therefore, that the trial court had no jurisdiction to hear the case until all administrative remedies had been exhausted. Ala.Code 1975, § 41-22-20. Indeed, this Court has acknowledged that failure to exhaust proper administrative remedies can preclude a court from acquiring subject-matter jurisdiction. Ex parte Crestwood Hosp. & Nursing Home, Inc., 670 So. 2d 45 (Ala.1995); Faulkner v. University of Tennessee, 627 So. 2d 362, 365 (Ala.1992) (citing Ex parte Graddick, 495 So. 2d 1367 (Ala.1986)). Even the trial court in this case pointed out that it would have no jurisdiction if the AAPA applied. The Propane Dealers, however, argue that the AAPA does not apply, because, they contend, the limited involvement of Coosa Electric with the LP Gas Board did not amount to an administrative proceeding; therefore, they argue, there were no administrative remedies to be sought. We agree.
*273 In their arguments before the trial court concerning lack of jurisdiction, the appellants relied on § 41-22-20(a), a part of the AAPA:
(Emphasis added.) A "contested case" is defined, in pertinent part, as "[a] proceeding, including but not restricted to ratemaking, price fixing, and licensing, in which the legal rights, duties, or privileges of a party are required by law to be determined by an agency after an opportunity for hearing." Ala.Code 1975, § 41-22-3(3). Also, the AAPA provides that "[i]n a contested case, all parties shall be afforded an opportunity for hearing after reasonable notice in writing delivered either by personal service as in civil actions or by certified mail, return receipt requested." Ala.Code 1975, § 41-22-12(a). It is clear from these statutes that a "contested case" is a proceeding before an agency in which legal rights, duties, or privileges are determined after one has been afforded the opportunity to appear and be heard. In the case at hand, the evidence before the trial court indicated that because it was acquiring an already existing gas company (DeKalb Gas), Coosa Electric did not need to go before the LP Gas Board and request a new gas permit. All that was required of Coosa Electric, according to a letter from the administrator of the LP Gas Board, was to furnish the Board with an updated copy of DeKalb Gas's articles of incorporation and a new certificate of insurance. Despite the appellants' arguments to the contrary, this "action" is not tantamount to the Board's making a "final decision in a contested case." Therefore, we hold that, under these facts, the AAPA does not govern and the trial court properly assumed jurisdiction over the case.
The appellants contend that the Propane Dealers do not have standing, because, they argue, the Propane Dealers are simply "competitors," under this Court's holding in Alabama State Florists Ass'n, Inc. v. Lee County Hosp. Bd., 479 So. 2d 720 (Ala.1985). In that case, this Court stated that "[a]s a rule, `a competitor cannot attack acts of a corporation as ultra vires, merely on the ground of injurious competition.'" 479 So. 2d at 722. However, the Propane Dealers argue that they do have standing, under this Court's decision in Traders & Farmers Bank v. Central Bank, 294 Ala. 622, 320 So. 2d 638 (1975). In Traders & Farmers Bank, this Court wrote, "Clearly, the threat of competition is sufficient to provide standing to contest the legality of a competitor's facility." 294 Ala. at 625-26, 320 So. 2d at 641. Although those two cases may require reconciliation at some point, the case now before this Court does not require it. Here, the Propane Dealers sought injunctive relief. Therefore, if any of the Propane Dealers had standing under some other rationale then we need not decide whether the others also had standing, for if the injunction was proper as to one of the Propane Dealers then it will clearly benefit all of the Propane Dealers. That is the case here.
As the Propane Dealers point out in their brief and as is evidenced in the record, one of their group, Suburban Gas, Inc., is a member of Coosa Electric. For certain economic associations, such as cooperatives, this Court has previously held that "members" are "the equivalent of `stockholders' of a corporation and thus ... enjoy the same equity ownership and property rights that shareholders enjoy in a commercial corporation." Opinion of the Justices, 373 So. 2d 293, 296 (Ala. 1979); see also Ala.Code 1975, § 10-4-190. A member of a cooperative, then, would be able to contest a cooperative's power to act, under § 10-2B-3.04(b)(1), which states that an ultra-vires challenge may be brought "[i]n a proceeding by a shareholder against the corporation to enjoin the act." This language does not concern derivative actions, because actions brought derivatively are specifically dealt with in § 10-2B-3.04(b)(2), *274 which allows a challenge to be brought "[i]n a proceeding by the corporation, directly, derivatively, or through a receiver, trustee, or other legal representative." Ala.Code 1975, § 10-2B-3.04(b)(2) (emphasis added). We agree, therefore, with the Propane Dealers that a member of a cooperative has standing to challenge the ultra-vires acts of that cooperative, independently of any derivative action. Because Suburban Gas is a member of Coosa Electric, we conclude that it has standing in this case. As we stated above, because Suburban Gas sought injunctive relief it is unnecessary for us to decide at this point whether any of the other Propane Dealers have standing as well.
The appellants argue that, even if the Propane Dealers have standing, the trial court ignored the plain meaning of § 37-6-3(9) and erroneously interpreted that section as barring Coosa Electric from acquiring a majority of the stock in DeKalb Gas. The Propane Dealers assert that, under certain rules of statutory construction and under the rationale of the Court of Civil Appeals in Blue Cross & Blue Shield v. Protective Life Ins. Co., supra, the trial court's order is correct. We disagree.
In Blue Cross, the Court of Civil Appeals, dealing with a factual situation that is similar to Coosa Electric's, had to interpret certain statutes. Blue Cross and Blue Shield of Alabama ("Blue Cross"), a medical insurance company, sought to expand its market by purchasing United Trust Life Insurance Company. 527 So. 2d at 126. According to the Court of Civil Appeals, Blue Cross was "purely a statutory creature," deriving all of its powers from Ala.Code 1975, §§ 10-4-100 to 10-4-115. Id. In opposition to the attempted acquisition, several interested life insurance companies intervened at the hearings held before the insurance commissioner, but the commissioner approved Blue Cross's actions. Id. The Montgomery County Circuit Court vacated the commissioner's order, holding that Blue Cross's powers of stock acquisition were limited by its enabling statutes. Id. The Court of Civil Appeals affirmed. Because the facts of Blue Cross, 527 So. 2d 125, and the facts of the present case are similar, a comparison of the relevant statutes will be helpful.
The Court of Civil Appeals stated that Blue Cross was limited by its express statutory purpose, as stated in § 10-4-100:
(Emphasis added.) However, Blue Cross argued that another Code section, § 10-3A-20(7), gave it broad powers of stock acquisition. That section allowed these powers:
Section 10-3A-20(7) was applicable to Blue Cross through § 10-4-101, which dealt with the proper contents of Blue Cross's articles of incorporation. Section 10-4-101 provided:
(Emphasis added.) Therefore, as the Court of Civil Appeals properly noted, Blue Cross could make use of its powers of stock acquisition, *275 but the "power-giving" section (§ 10-3A-20(7)) was expressly limited by § 10-4-101, which required that the use of those powers be "not inconsistent with the provisions of [the] article," including the limited purpose set forth in § 10-4-100. Blue Cross, 527 So. 2d at 127. The Court of Civil Appeals concluded that marketing life insurance through a subsidiary company was outside the scope of Blue Cross's limited statutory purpose.
By comparison, Coosa Electric falls under similarly codified "purpose" language:
Ala.Code 1975, § 37-6-2 (emphasis added). Also, Coosa Electric's articles of incorporation are governed by language similar to that applicable in Blue Cross:
Ala.Code 1975, § 37-6-6 (emphasis added). However, Coosa Electric's stock-acquisition powers are expressly and specifically broader in scope than those of Blue Cross, and they do not require that if Coosa Electric purchases stock in other companies it must be in companies with the same general purposes stated in § 37-6-2. Section 37-6-3 provides:
(Emphasis added.) The appellants argue that, according to the plain meaning of this section, Coosa Electric should not be prohibited from purchasing 100% of DeKalb Gas stock. The Propane Dealers argue that if § 37-6-3(9) is read literally, then § 37-6-2 will have no limiting effect, i.e., the restrictions placed on the purposes and functions of cooperatives, as stated in § 37-6-2, will be meaningless.
In determining the meaning of a statute, this Court looks to the plain meaning of the words as written by the legislature. As we have said:
Blue Cross & Blue Shield v. Nielsen, 714 So. 2d 293, 296 (Ala.1998) (quoting IMED Corp. v. Systems Eng'g Assocs. Corp., 602 *276 So. 2d 344, 346 (Ala.1992)); see also Tuscaloosa County Comm'n v. Deputy Sheriffs' Ass'n, 589 So. 2d 687, 689 (Ala.1991); Coastal States Gas Transmission Co. v. Alabama Pub. Serv. Comm'n, 524 So. 2d 357, 360 (Ala.1988); Alabama Farm Bureau Mut. Cas. Ins. Co. v. City of Hartselle, 460 So. 2d 1219, 1223 (Ala. 1984); Dumas Bros. Mfg. Co. v. Southern Guar. Ins. Co., 431 So. 2d 534, 536 (Ala.1983); Town of Loxley v. Rosinton Water, Sewer, & Fire Protection Auth., Inc., 376 So. 2d 705, 708 (Ala.1979). It is true that when looking at a statute we might sometimes think that the ramifications of the words are inefficient or unusual. However, it is our job to say what the law is, not to say what it should be. Therefore, only if there is no rational way to interpret the words as stated will we look beyond those words to determine legislative intent. To apply a different policy would turn this Court into a legislative body, and doing that, of course, would be utterly inconsistent with the doctrine of separation of powers. See Ex parte T.B., 698 So. 2d 127, 130 (Ala.1997).
Section 37-6-3(9) is not ambiguous. It states that a cooperative may purchase stock in an existing corporation regardless of that corporation's purposes or activities. Also, there is no limitation on the amount of stock that a cooperative may purchase in a particular entity. Therefore, according to § 37-6-3(9), Coosa Electric was acting within its statutory authority when it purchased 100% of the stock in DeKalb Gas. This reading does not nullify the limited purposes for which cooperatives may be established, as stated in § 37-6-2, because an entity must first be established as a cooperative in one of the four categories (providing electric, water, sewage, or television services) before these § 37-6-3 powers can be utilized.
The Propane Dealers argue further that § 37-6-3(9) makes much more sense when it is looked at as an "investment" statute. Under such a reading, § 37-6-3(9) would allow cooperatives to gain revenue by investing in, but not owning, general purpose corporations. This is a sensible way to look at the section, because activities allowed by an "investment" statute would need to be broader than the limited cooperative purpose, so that a cooperative would not be restricted to investing only in electric, water, sewage, or television companies, which may not be the best financial choices.
Also, the Propane Dealers assert that this interpretation comports with the intent of the legislature as demonstrated by: (1) the title of the act that amended § 37-6-9(3); (2) the legislative history behind the section; (3) certain presumptions concerning the legislature's knowledge; (4) the in pari materia rule, which states that legislative intent may be demonstrated from construing certain sections of a statute together to determine the meaning of a particular section; and (5) examining the entire statute as a whole to discover the intent behind a particular provision. We have, in the past, made use of these aids to statutory construction. See Jordan v. Reliable Life Ins. Co., 589 So. 2d 699, 702 (Ala.1991) (stating that "the title of an act may serve as an aid to statutory interpretation"); McCausland v. Tide-May-flower Moving & Storage, 499 So. 2d 1378, 1382 (Ala.1986) (stating that subsections of a statute "should be construed together to ascertain the meaning and intent of each"); Bowlin Horn v. Citizens Hosp., 425 So. 2d 1065, 1070 (Ala.1982) (stating that "in determining legislative intent, courts may look to the history of the statute"); Employees' Retirement Sys. v. Head, 369 So. 2d 1227, 1228 (Ala.1979) (stating that, "[i]n arriving at a determination of the intent of the legislature, the whole statute under construction should be examined and, if possible, each section should be given effect"); Beasley v. MacDonald Eng'g. Co., 287 Ala. 189, 197, 249 So. 2d 844, 851 (1971) (utilizing the "presumption that the legislature did not intend to make any alteration in the law beyond what it declares either expressly or by unmistakable implication").
In fact, as the Propane Dealers argue, these aids may give weight to their reading of § 37-6-3(9) as an "investment" provision. For example, if this section is read in the light of all of the other powers enumerated in § 37-6-3, one might think that the legislature may have intended § 37-6-3(9) to be a more limited provision than the words would allow. This is because every other enumerated power specifically refers only to powers *277 associated with the four purposes for which a cooperative may be established. See Ala. Code 1975, §§ 37-6-2 and 37-6-3(9). However, another way to look at it would be to say that the legislature intended to regulate the cooperatives' actions with regard to those four purposes and that it did not intend to regulate the cooperatives' interests in other corporations.
Regardless, the point is that it is not our place to engage in such a guessing game. That is why we must look first to the plain meaning of the words the legislature used. We should turn to extrinsic aids to determine the meaning of a piece of legislation only if we can draw no rational conclusion from a straightforward application of the terms of the statute. Although there is validity to the Propane Dealers' arguments that Coosa Electric is "bootstrapping" its way into a business that it would have no statutory authority to begin as a cooperative, those arguments should be directed to the legislature, not to this Court. Therefore, we conclude, based on the plain wording of § 37-6-3(9), that the trial court erred, as a matter of law, in entering the summary judgment for the Propane Dealers and in enjoining Coosa Electric from owning 100% of the DeKalb Gas stock.
For the foregoing reasons, the judgment is reversed and the case is remanded for further proceedings consistent with this opinion.
1971443REVERSED AND REMANDED.
1971532REVERSED AND REMANDED.
HOOPER, C.J., and MADDOX, ALMON, SEE, and LYONS, JJ., concur.
SHORES, KENNEDY, and COOK, JJ., concur in the result. | 26013fc59de3442e50f56439de7c26c0dc8bfe30b570f92f04f8dfbf9527fc86 | 1998-11-25 00:00:00 |
1d1b472d-b4a9-4ace-9c0a-b8a337236ead | Lindley v. State | 728 So. 2d 1153 | 1961992 | Alabama | Alabama Supreme Court | 728 So. 2d 1153 (1998)
Ex parte State of Alabama.
In re Jeffery Carl LINDLEY[*]
v.
STATE.
1961992.
Supreme Court of Alabama.
September 11, 1998.
As Modified on Denial of Rehearing November 20, 1998.
*1154 Bill Pryor, atty. gen., and Beth Slate Poe, asst. atty. gen., for petitioner.
Jeffery Carl Lindley, respondent, pro se.
PER CURIAM.
Jeffery Carl Lindley was convicted of one count of first-degree assault, three counts of second-degree assault, and one count of the criminal use of a noxious substance. Those convictions arose out of charges that he threw a tear gas bomb into a residence occupied by two adults, a three-year-old child, and a three-week-old infant. Lindley appealed his convictions to the Court of Criminal Appeals. That court reversed the convictions and rendered a judgment in Lindley's favor. Lindley v. State, 728 So. 2d 1150 (Ala. Crim.App.1997). We granted the State's petition for certiorari review. We affirm the judgment of the Court of Criminal Appeals in part, reverse it in part, and remand.
The only evidence connecting Lindley to the crimes consisted of a statement made to an investigating officer by Billy Joe Scott, a friend of Lindley's, in which Scott stated that Lindley had told him he had thrown the tear gas bomb. At trial, however, Scott testified that he did not remember anything about the period of time during which the crimes were committed. The prosecutor then showed Scott a copy of the statement he had made. Scott testified that he recognized his signature on the statement, but said that on the date listed on the statement, and for several days before that date, he had been drunk, and he said he presently did not remember anything about the events described in the statement. He further testified that he did not remember making the statement or talking to the investigating officer.
*1155 The Court of Criminal Appeals concluded that Scott's prior inconsistent statement was admissible as a prior out-of-court statement and, therefore, that the statement was admissible only to impeach Scott's testimony, not as substantive evidence of Lindley's guilt. That court also concluded that Scott's statement was not admissible pursuant to the past-recollection-recorded exception to the hearsay rule. The Court of Criminal Appeals held that the trial court erred in overruling Lindley's motion for a judgment of acquittal and, without addressing the question of double jeopardy, it rendered a judgment for Lindley instead of remanding for a new trial. 728 So. 2d 1150.
The State argues: (1) Previous opinions of the United States Supreme Court and of Alabama appellate courts require that the judgment in this case be reversed and the case remanded, not that a judgment for the defendant be rendered; the State says that aspect of the Court of Criminal Appeals' opinion rendering a judgment for Lindley conflicts with Lockhart v. Nelson, 488 U.S. 33, 109 S. Ct. 285, 102 L. Ed. 2d 265 (1988); Zinn v. State, 527 So. 2d 148 (Ala.1988); and Mayo v. City of Rainbow City, 642 So. 2d 524 (Ala.Crim.App.1994). (2) Any error in admitting Scott's statement was cured when admissible evidence regarding the statement was presented by the investigating officer. (3) The Court of Criminal Appeals misinterpreted the doctrine of past recollection recorded.
We first address the issues regarding the admissibility of the evidence. The Court of Criminal Appeals correctly held that Scott's prior inconsistent statement could not be used as substantive evidence of Lindley's guilt. See Hooper v. State, 585 So. 2d 137 (Ala.1990), cert. denied, 503 U.S. 920, 112 S. Ct. 1295, 117 L. Ed. 2d 517 (1992). The State argues, however, that the investigating officer's testimony about Scott's statement to him was admissible and cured any error in the admission of the statement into evidence. As the Court of Criminal Appeals noted, however, "where a nonparty witness denies having made a prior statement, the alleged statement cannot be shown from the testimony of other witnesses. Carroll v. State, 473 So. 2d 1219, 1225 (Ala.Cr.App.1985)." Lindley v. State, 728 So. 2d at 1151.
The Court of Criminal Appeals also correctly held that Scott's statement was not admissible as a past recollection recorded. Although the State argues that Scott should not be allowed to evade his responsibility to testify against his friend by claiming to have been drunk when he gave his statement to the investigating officer, Scott did not testify at trial that he personally observed the facts referred to in the writing or that at the time the statement was made he knew of its contents and knew them to be true. Testimony to that effect is required before a statement can be admissible under the doctrine of past recollection recorded. See C. Gamble, McElroy's Alabama Evidence, § 116.03 at 528-33 (5th ed.1996).
Our sister State of Maryland has examined a question similar to the one now before us. In Ringgold v. State, 34 Md.App. 286, 367 A.2d 35 (Ct.Spec.App.1976), the State attempted to cure a witness's "convenient amnesia" by utilizing the doctrine of past recollection recorded. Ringgold was accused of robbing a pharmacy. Approximately a week after the robbery, his mother-in-law, Arlene Joyner, gave a statement to a police officer in which she said that on the morning of the robbery her son and Ringgold had left her house in a black Volkswagen. A black Volkswagen had been observed at the scene of the robbery. At the trial, Joyner stated that she did not remember what she had talked about with the officer, did not remember what had occurred on the day of the robbery, and could not remember giving or signing the statement. When the prosecutor showed Joyner her signed statement, she admitted that the signature looked like hers, but testified that seeing the statement did not refresh her recollection and that she could not testify as to its truthfulness. She contended that she did not remember signing the statement, because, she said, she had been upset. The Ringgold court examined the history of the doctrine of past recollection recorded, but concluded that that doctrine did not apply to *1156 allow Joyner's statement to be admitted into evidence. The court stated:
34 Md.App. at 293-94, 367 A.2d at 39.
We conclude that, even though Scott's inability to recall his prior statement is suspicious, the fact remains that the State could not elicit the foundation necessary to admit his statement as a past recollection recorded.
We now address the issue whether double jeopardy considerations prevent the State from retrying Lindley. The State insists that even if Scott's statement to the investigating officer is inadmissible, the Court of Criminal Appeals should not have rendered a judgment for Lindley because, it argues, the Double Jeopardy Clause of the Fifth Amendment to the Constitution of the United States does not bar a retrial in this case.
The Double Jeopardy Clause provides:
The Double Jeopardy Clause is made applicable to the states through the Due Process Clause of the Fourteenth Amendment.[1]Benton v. Maryland, 395 U.S. 784, 89 S. Ct. 2056, 23 L. Ed. 2d 707 (1969). The Supreme Court of the United States has interpreted the Double Jeopardy Clause to provide three separate protections to criminal defendants. First, it protects against multiple punishments for the same offense. United States v. Benz, 282 U.S. 304, 51 S. Ct. 113, 75 L. Ed. 354 (1931). Second, it protects against a second prosecution for the same offense after a conviction. Ex parte Nielsen, 131 U.S. 176, 9 S. Ct. 672, 33 L. Ed. 118 (1889). Third, it protects against a second prosecution for the same offense after the trier of fact acquits the defendant. Green v. United States, 355 U.S. 184, 78 S. Ct. 221, 2 L. Ed. 2d 199 (1957). Accord North Carolina v. Pearce, 395 U.S. 711, 89 S. Ct. 2072, 23 L. Ed. 2d 656 (1969), overruled on other grounds, Alabama v. Smith, 490 U.S. 794, 109 S. Ct. 2201, 104 L. Ed. 2d 865 (1989).
With respect to an appellate court's reversal of a conviction, the Supreme Court long has embraced the general rule that when a reversal is based on a procedural trial error, the Double Jeopardy Clause does not bar retrial. United States v. Ball, 163 U.S. 662, 16 S. Ct. 1192, 41 L. Ed. 300 (1896). The Supreme Court has provided a narrow exception to the general rule allowing retrial. Where a conviction is reversed solely on the basis of insufficiency of the evidence, retrial is barred because such a reversal is equivalent to an acquittal by the trial court. Burks v. United States, 437 U.S. 1, 98 S. Ct. 2141, 57 L. Ed. 2d 1 (1978).
In Lockhart v. Nelson, 488 U.S. 33, 109 S. Ct. 285, 102 L. Ed. 2d 265 (1988), the Supreme Court considered whether the Double Jeopardy Clause barred a retrial when an appellate court's correction of a trial error involving an evidentiary ruling renders the remaining evidence insufficient to support the conviction. In Lockhart, the defendant was sentenced under Arkansas's Habitual Felony Offender Act, under which the defendant could receive an enhanced sentence upon proof of four prior felony convictions. *1157 Id. at 34-35, 109 S. Ct. 285. The State presented certified copies of four prior felony convictions. Id. at 36, 109 S. Ct. 285. Several years later, on federal habeas corpus review, it was discovered that as to one of the convictions the defendant had been pardoned by the Governor, thus vitiating that conviction's legal effect with respect to sentencing the defendant under the Habitual Felony Offender Act. Id. The United States District Court for the Eastern District of Arkansas held that "the Double Jeopardy Clause prevented the State from attempting to resentence [the defendant] as a habitual offender," and the United States Court of Appeals for the Eighth Circuit affirmed. Id. at 37, 109 S. Ct. 285.
On certiorari review, the Supreme Court recognized that although the Double Jeopardy Clause bars retrial when a conviction is reversed solely on the basis of an insufficiency of the evidence, it does not bar retrial when a conviction is reversed based on trial error:
Lockhart, 488 U.S. at 40-42, 109 S. Ct. 285 (quoting Burks, 437 U.S. at 14-16, 98 S.Ct. 2141) (last emphasis added; other emphasis in Lockhart).[2] Thus, the Supreme Court held that "where the evidence offered by the State and admitted by the trial court whether erroneously or notwould have been sufficient to sustain a guilty verdict, the Double Jeopardy Clause does not preclude retrial." Id. at 34, 109 S. Ct. 285.
In Lockhart, the Supreme Court rejected a hindsight approach under which an appellate court could retroactively exclude evidence and bar retrial if the remaining evidence was insufficient to support the conviction. Compare Lockhart, 488 U.S. at 40-42, 109 S. Ct. 285, with id. at 42-50, 109 S. Ct. 285 (Marshall, J., dissenting). Instead, Lockhart requires an appellate court to step into the shoes of the trial court and to consider all of the evidence admitted before the jury whether or not erroneouslyto determine if such evidence was sufficient to support the conviction. If so, the Double Jeopardy Clause does not bar retrial. Id. at 42, 109 S. Ct. 285.
In Reese v. State, 671 So. 2d 126 (Ala.Crim. App.1995), the Court of Criminal Appeals rendered a judgment for the appellant because no evidence other than a witness's *1158 prior inconsistent statement was offered to identify the appellant as the perpetrator of a crime. Without the inadmissible evidence, the court said, "the state has failed to make a prima facie case." Id. at 128. Lockhart requires, however, that all of the evidence admitted to the jury, including that evidence that later was found to be inadmissible on appeal, be considered in determining whether the evidence was sufficient to support the conviction. If it was, then the Double Jeopardy Clause did not bar retrial. Lockhart, 488 U.S. at 42, 109 S. Ct. 285. To the extent that Reese holds otherwise, it is hereby overruled.
In Lockhart, the evidence actually submitted to support the imposition of an enhanced sentence (four prior convictions), whether erroneously admitted or not, was sufficient to support the enhancement. Thus, the reversal was not equivalent to an acquittal. 488 U.S. at 40, 109 S.Ct. 285: In this present case, the trial court erroneously admitted hearsay evidenceScott's prior inconsistent statementas substantive evidence of Lindley's guilt. The total evidence offered by the State and admitted by the trial court, however, whether erroneously admitted as substantive evidence or not, was sufficient to sustain a guilty verdict.[3] Thus, the Double Jeopardy Clause does not preclude the State from retrying Lindley.
While the State cannot on retrial resubmit Scott's unauthenticated prior inconsistent statement, it should have the opportunity to submit other evidence of Lindley's guilt. In Hull v. State, 607 So. 2d 369 (Ala.Crim.App. 1992), the Court of Criminal Appeals explained:
Hull, 607 So. 2d at 379 (quoting Lockhart, 488 U.S. at 42, 109 S.Ct. 285) (ellipsis in Hull).
In Hull, the Court of Criminal Appeals stated that although evidence held inadmissible on an initial appeal could not be resubmitted on a retrial, it would not speculate as to what additional evidence the State might, or might not, produce at a retrial.
On remand, the State cannot premise a second prosecution of Lindley on the same evidence that on this appeal has been held inadmissible (Scott's prior inconsistent statement), but must offer additional evidence of guilt. If the State has no additional evidence, then the trial court should enter a judgment of acquittal.
That aspect of the judgment of the Court of Criminal Appeals rendering a judgment in Lindley's favor is reversed. The remainder of the judgment is affirmed. The cause is remanded for action consistent with this opinion.
AFFIRMED IN PART; REVERSED IN PART; AND REMANDED.
HOOPER, C.J., and MADDOX, HOUSTON, KENNEDY, COOK, SEE, and LYONS, JJ., concur.
ALMON and SHORES, JJ., concur in part and dissent in part.
ALMON, Justice (concurring in part and dissenting in part).
The majority misapplies the Double Jeopardy Clauses of both the Alabama Constitution of 1901, art. I, § 9, and the United States Constitution, amend. V. In the context of this case, the double jeopardy prohibition prevents the state from having two bites at the same apple.
The majority states, and I agree, that the trial court should not have admitted Scott's prior inconsistent statement as substantive evidence of guilt. This was all the evidence the State presented. Thus, the State presented absolutely no admissible evidence of guilt. If "no evidence" is not insufficient evidence, then I do not know what is. Yet the majority remands for a new trial, so the State will have an opportunity to find new evidence. This decision allows the State two bites at the same apple.
None of the cases cited by the majority supports this conclusion. Even if the trial court had ruled properly on all questions of law, the quantum of evidence presented by the State would still be zero.
The Court's wording directing a remand gives the reason for applying the bar of double jeopardy:
728 So. 2d at 1159 (emphasis added). If the sum of all the evidence, including the erroneously admitted evidence, is insufficient to support the conviction, then there can be no retrial.
Burks v. United States, 437 U.S. 1, 11, 98 S. Ct. 2141, 57 L. Ed. 2d 1 (1978).
Hurst v. State, 86 Ala. 604, 606, 6 So. 120, 120 (1889).
Eastep v. State, 25 Ala.App. 593, 594, 151 So. 616, 617-18 (1933).
The Supreme Court of the United States has stated the following regarding the application of the Double Jeopardy Clause:
Lockhart v. Nelson, 488 U.S. 33, 40-41, 109 S. Ct. 285, 102 L. Ed. 2d 265 (1988). (Emphasis in original.)
In this case, the State cannot rehabilitate its case by correcting error on a second trial, as the prosecution could in Lockhart. In this present case, if the trial judge had ruled properly on all questions of evidence, then he should have granted a motion for acquittal based on insufficiency of the evidence. The error in this case was the acceptance, as substantive evidence, of the prior statement of the witness. That statement could be used only as impeachment evidence because the State could not lay a predicate for its admission as a past recollection recorded. That statement was the only "evidence" offered to prove Lindley's guilt. It was not admissible as evidence of guilt; it could be used only to impeach the witness's credibility. Ex parte Brown, 499 So. 2d 787, 791 (Ala.1986). "[I]n particular, such [a] statement cannot be the basis of a finding of fact necessary to the establishment of civil or criminal liability or a defense to either." C. Gamble, McElroy's Alabama Evidence, § 159.02(1) (5th ed.1996). Thus, there was no substantive evidence of guilt admitted against Lindley.
*1161 I disagree with any conclusion that Lockhart modifies Burks in cases where the State's evidence is insufficient to support a conviction. In Lockhart, the defendant pleaded guilty to burglary and the jeopardy issue arose at the sentencing phase; it concerned the proof of four prior felonies used to enhance the defendant's punishment. This Court and the Court of Criminal Appeals have for some time remanded cases for the trial court to correct sentencing errors when the defendant has already been properly found guilty. Sentencing is quite different from adjudicating guilt. These could be considered as apples and oranges. Having two bites of an orange is different from having two bites of an apple. In the instant case, the State produced no legal evidence of guilt, yet the majority remands for the State to see if it can find new evidence of guilt.
I also find Zinn v. State, 527 So. 2d 148 (Ala.1988), distinguishable. Zinn was convicted of driving while his license was revoked. To prove the revocation of his license, the State offered the affidavit of the supervisor of records in the Driver's License Division of the Department of Public Safety. That affidavit was admissible as proof of the offense, under Brown v. City of Montgomery, 504 So. 2d 748 (Ala.Crim.App.1987). However, the Court of Criminal Appeals overruled Brown, held that the affidavit was not admissible, and rendered a judgment for Zinn. On certiorari review, this Court held that the Court of Criminal Appeals had erred in rendering a judgment for Zinn rather than allowing a retrial. That result was correct, because the evidence offered against Zinn was, under the law applicable at the time of trial, admissible to prove guilt, and it was only by an overruling of that law that the evidence was deemed inadmissible. If the State had known that it could not rely upon Brown, it could have proved Zinn's driving record in another way. Thus, Zinn presents a situation where probative evidence was admitted, but erroneously, and that error was curable so that the same evidence, or its equivalent, could be admitted without error on retrial.
Here, the State presented was no probative evidence of Lindley's guilt. The circuit court erroneously concluded that the prior inconsistent statement was substantive evidence. I would not view that conclusion as bringing this case within the principle of Lockhart or Zinn. This is not a situation where probative evidence was erroneously admitted; rather, in this case, no substantive evidence of guilt was admitted, but the case was submitted to the jury anyway. To allow a retrial in such a situation is a serious and fundamental misapplication of the principles of double jeopardy.
I would hold that the Double Jeopardy Clause of the Fifth Amendment to the United States Constitution and the Double Jeopardy Clause of Article I, § 9, of the Constitution of Alabama of 1901 bar the State from reprosecuting Lindley.
I concur to the extent the majority holds that Lindley's convictions were properly reversed. However, I dissent from the holding that Lindley can be reprosecuted.
SHORES, J., concurs.
[*] Note from the reporter of decisions: Some of the documents filed in this case spell this defendant's name "Jeffrey Carl Lindley."
[1] The Due Process Clause provides:
"No state shall ... deprive any person of life, liberty, or property, without due process of law...."
U.S. Const. amend. XIV, § 1.
[2] The Court also explained:
"`Corresponding to the right of an accused to be given a fair trial is the societal interest in punishing one whose guilt is clear after he has obtained such a trial. It would be a high price indeed for society to pay were every accused granted immunity from punishment because of any defect sufficient to constitute reversible error in the proceedings leading to conviction.'"
Lockhart, 488 U.S. at 38, 109 S. Ct. 285 (quoting United States v. Tateo, 377 U.S. 463, 466, 84 S. Ct. 1587, 12 L. Ed. 2d 448 (1964)).
[3] In Burks, 437 U.S. at 14, 98 S. Ct. 2141 (see text and n. 8), the Supreme Court expressly noted that United States v. Ball, 163 U.S. 662, 16 S. Ct. 1192, 41 L. Ed. 300 (1896), cited cases involving "trial errors," including "improper hearsay testimony received."
[4] Although the investigating officer in this case responded "no" when asked whether any person other than Scott or any physical evidence tied Lindley to the tear gas bomb, and "no" when asked whether anyone saw who threw the tear gas bomb, nowhere in the record does the State concede that it has no additional evidence. If indeed the State has no other evidence, then further prosecution will be futile. | cfc17151cc362c1e48d25947f8f896d8a82b35ae3807a1644d0ba3095427fe1f | 1998-11-20 00:00:00 |
3967468a-3585-49b4-8a6c-74fe957b30e5 | Ex Parte Phase III Const., Inc. | 723 So. 2d 1263 | 1971386 | Alabama | Alabama Supreme Court | 723 So. 2d 1263 (1998)
Ex parte PHASE III CONSTRUCTION, INC.
(In re Collins Signs, Inc.
v.
Phase III Construction, Inc.)
1971386.
Supreme Court of Alabama.
November 13, 1998.
Wade H. Baxley of Ramsey, Baxley & McDougle, Dothan, for petitioner.
Dow T. Huskey, Dothan, for respondent.
SHORES, Justice.
This petition for the writ of mandamus arises out of an oral contract between Phase III Construction, Inc. (a Virginia construction management corporation), which bargained with Collins Signs, Inc. (an Alabama sign-manufacturing corporation), for Collins Signs to manufacture signage and install it at a Waffle House restaurant in Virginia. On January 7, 1998, Collins filed a breach-of-contract action in the circuit court of Houston County, Alabama, against Phase III, alleging that it had failed to pay the contract price. On February 6, 1998, Phase III moved to dismiss the action for lack of personal jurisdiction; the trial court denied the motion to dismiss, on March 24, 1998.
Phase III petitions for a writ of mandamus (and, alternatively, for a writ of prohibition) directing Judge C. Lawson Little, of the Houston Circuit Court to show cause why he should not grant Phase III's motion to dismiss for lack of personal jurisdiction. "`Mandamus is a drastic and extraordinary writ to be issued only where there is (1) a clear legal right in the petitioner to the order sought; (2) an imperative duty upon the respondent to perform, accompanied by a refusal to do so; (3) the lack of another adequate remedy; and (4) properly invoked jurisdiction of the court.'" Ex parte Mardis, 628 So. 2d 605, 606 (Ala.1993), quoting Ex parte Ben-Acadia, Ltd., 566 So. 2d 486, 488 (Ala.1990). "Because `mandamus is an extraordinary remedy, the standard of review for a writ of mandamus is whether there has been a clear abuse of discretion by the trial judge.'" Ex parte Mardis, 628 So. 2d at 606, quoting Ex parte Rudolph, 515 So. 2d 704, 706 (Ala.1987). The circuit court's order denying Phase III's motion to dismiss for lack of personal jurisdiction is an interlocutory order; therefore, a petition for the writ of *1264 mandamus is an appropriate means for Phase III to seek a remedy in this case. Ex parte Paul Maclean Land Services, Inc., 613 So. 2d 1284, 1286 (Ala.1993), citing Ex parte Hartford Ins. Co., 394 So. 2d 933 (Ala.1981).
Phase III argues that it does not have sufficient minimum contacts with the State of Alabama to confer on an Alabama court personal jurisdiction. In support of its motion to dismiss for lack of personal jurisdiction, Phase III filed with the circuit court the affidavit of Ree R. Ellis, president of Phase III. The affidavit states: (1) that Phase III is a Virginia corporation; (2) that it maintains its principal office in Virginia; (3) that it has never qualified to do business as a foreign corporation in the State of Alabama; (4) that it does not transact business, by agent or otherwise, in the State of Alabama; and (5) that it does not own property in the State of Alabama. The affidavit continues on to state that Phase III was referred to Collins by the corporate office of the company that operates Waffle House restaurants and that thereafter Phase III did in fact contact Collins, by telephone, to arrange the purchase and installation of certain signage for a Waffle House restaurant in Richmond, Virginia.
Phase III cites Ex parte Kamilewicz, 700 So. 2d 340 (Ala.1997), and Ex parte United Bhd. of Carpenters, 688 So. 2d 246 (Ala.1997), cert. denied, United Bhd. of Carpenters v. BE & K Constr. Co., ___ U.S. ___, 117 S. Ct. 2509, 138 L. Ed. 2d 1012 (1997), as acknowledging that the constitutional touchstone that determines whether a state court can assert jurisdiction over a nonresident defendant remains whether the defendant purposefully established "minimum contacts" with the forum state. International Shoe Co. v. Washington, 326 U.S. 310, 318, 66 S. Ct. 154, 90 L. Ed. 95 (1945). This is recognized by the Alabama Rules of Civil Procedure. Rule 4.2, Ala.R.Civ.P., provides:
This Court has held that "[s]ervice of process under Rule 4.2(a)(2) [is] as far-reaching as due process permits." Ex parte Kamilewicz, 700 So. 2d at 342.
As Ex parte Kamilewicz, notes, "`Few Alabama cases have specifically addressed the issue of what contacts will subject a defendant to the general jurisdiction of this state's courts, and those that have done so have focused on the activities of corporations seeking to avail themselves of profit in this state.'" 700 So. 2d at 344, quoting Ex parte United Bhd. of Carpenters, supra, 688 So. 2d at 250. When nonresident defendants have initiated contacts with this state solely for their own profit, availing themselves of the privileges of conducting business here, this Court has determined that such activities were sufficiently systematic and continuous to support a finding of general jurisdiction and has determined that it was fair and *1265 reasonable and thus consistent with the principles of due process to invoke such jurisdiction. See, e.g., Ex parte Newco Mfg. Co., 481 So. 2d 867 (Ala.1985); Atlanta Auto Auction, Inc. v. G & G Auto Sales, Inc., 512 So. 2d 1334 (Ala.1987). Phase III reminds us that in Steel Processors, Inc. v. Sue's Pumps, Inc. Rentals, 622 So. 2d 910 (Ala.1993), this Court stated that "[t]he purchase of goods fabricated in a forum state, and of services provided by a resident corporation of a forum state, does not alone provide the requisite `minimum contacts' for exercise of personal jurisdiction within the bounds of due process." 622 So. 2d at 913-14.
In support of its position that Phase III has sufficient minimum contacts to subject it to the jurisdiction of an Alabama court, Collins filed two affidavits from Barbara Tew, its "assistant vice president of program management." The first affidavit states that Collins Signs, at its place of business in Dothan, Alabama, had, "[i]n early 1996, ... received a telephone call from a representative of Phase III ..., requesting that Collins manufacture signage for Phase III's customer, Waffle House." Further, the affidavit states that Phase III's call to Collins was "unsolicited" and that it led to further contacts in which Phase III requested that Collins manufacture the signs at Collins's plant in Dothan, Alabama. In Tew's second affidavit, she summarized "some, but not all," of her contacts with Phase III. Tew's affidavit revealed the following 10 contacts between Phase III and Collins: (1) On March 8, 1996, Ellis telephoned Tew and requested information; (2) on March 18, 1996, Ellis telephoned Tew and discussed signage; (3) on March 20, 1996, Tew mailed Ellis the requested color renderings; (4) on March 21, 1996, Tew mailed Ellis pricing information; (5) on April 2, 1996, Tew mailed Ellis drawings of different signage; (6) on April 3, 1996, Ellis telephoned Tew and requested color renderings for a different-size sign and Tew mailed the requested information to Ellis; (7) on February 27, 1997, Ellis telephoned Tew and notified Tew that Ellis was sending drawings by facsimile transmission; Tew received the fax and subsequently received the originals by overnight delivery service; (8) on February 28, 1997, Ellis telephoned Tew to ask for pricing information and Tew faxed the requested information to Ellis; (9) on February 28, 1997, Ellis telephoned Tew and requested that Collins begin manufacturing the signage; and (10) on March 21, 1997, Ellis telephoned Tew regarding the site plan and permits and discussed the signage installation; this information was later sent to Collins, by Phase III, via fax.
Tew's second affidavit further states that, at Phase III's request, Collins shipped the signage from Dothan, Alabama, to Richmond, Virginia, for installation and that, thereafter, Collins invoiced Phase III for the work. Finally, Tew's second affidavit states that on September 9, 1997, Phase III sent Collins a partial payment in the amount of $8,132.33.
We cannot hold that the trial judge clearly abused his discretion in concluding that, because Collins's breach-of-contract action arises from Phase III's contacts with Alabama, it is fair and reasonable to require Phase III to come into Alabama and defend this action. Phase III initiated its contacts with this State solely for its own profit, availing itself of the privileges of conducting business here. While Phase III contends that it was merely referred to Alabama by the national office of the Waffle House company, it does not dispute that it did order the manufacture and installation of a Waffle House sign in order to complete its contract with Waffle House in Virginia. This is far more than the simple purchase of goods fabricated in a forum state. Phase III's activities were sufficiently systematic and continuous to support a finding of general jurisdiction. Therefore, it was fair and reasonable to invoke such jurisdiction. Ex parte United Bhd. of Carpenters, 688 So. 2d at 252, citing Ex parte Newco Mfg. Co. and Atlanta Auto Auction, Inc. v. G & G Auto Sales, Inc., supra.
WRIT DENIED.
ALMON, HOUSTON, KENNEDY, and COOK, JJ., concur.
MADDOX, SEE, and LYONS, JJ., concur in the result.
*1266 LYONS, Justice (concurring in the result).
I concur in the result only, because I do not think we can characterize the relation of Phase III to Alabama as one giving rise to "general jurisdiction." General jurisdiction requires "systematic and continuous" contacts with the forum state. All of Phase III's contacts with Alabama specifically relate to the one and only transaction it conducted with an Alabama corporation. Therefore, if Alabama courts have jurisdiction over Phase III, that jurisdiction must be specific.
The Due Process Clause provides: "No State shall ... deprive any person of life, liberty, or property, without due process of law." U.S. Const. amend. XIV, § 1. The Supreme Court of the United States has interpreted the guaranty of "due process of law" to require that a nonresident defendant have "certain minimum contacts" with a state before that party can be subjected to a lawsuit in the courts of that state. International Shoe Co. v. Washington, 326 U.S. 310, 316, 318, 66 S. Ct. 154, 90 L. Ed. 95 (1945) (stating that a defendant must have "sufficient contacts" with the forum state to establish that he purposely availed himself of the benefits and protections of the forum state); accord, Ex parte United Brotherhood of Carpenters, 688 So. 2d 246, 250 (Ala.1997) (citing International Shoe, 326 U.S. 310, 66 S. Ct. 154, 90 L.Ed. 95); Rule 4.2(a)(2)(I), Ala. R. Civ. P.
Two types of contacts can form a basis for personal jurisdiction: general contacts and specific contacts. General contacts, which give rise to general personal jurisdiction, consist of the defendant's contacts with the forum state that are unrelated to the cause of action and that are both "continuous and systematic." Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414 n. 9, 415, 104 S. Ct. 1868, 80 L. Ed. 2d 404 (1984); World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 100 S. Ct. 559, 62 L. Ed. 2d 490 (1980); Ex parte Kamilewicz, 700 So. 2d 340 (Ala.1997); Ex parte Newco Mfg. Co., 481 So. 2d 867 (Ala.1985). Specific contacts, which give rise to specific personal jurisdiction, consist of the defendant's contacts with the forum state that are related to the cause of action. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472-75, 105 S. Ct. 2174, 85 L. Ed. 2d 528 (1985). Although the related contacts need not be continuous and systematic, they must rise to such a level as to cause the defendant to anticipate being haled into court in the forum state. Id.
In cases involving specific jurisdiction, we must determine whether the action arose from the defendant's contacts with the forum state. See Borg-Warner Acceptance Corp. v. Lovett & Tharpe, Inc., 786 F.2d 1055, 1057 (11th Cir.1986). In doing so, we "must consider the `relationship among the defendant, the forum, and the litigation' to determine whether the exercise of jurisdiction [would be] consistent with due process." Id. at 1057, quoting Shaffer v. Heitner, 433 U.S. 186, 204, 97 S. Ct. 2569, 53 L. Ed. 2d 683 (1977). This Court has recognized that "[f]ederal courts have held that, in the absence of other factors tending to support [a finding of] jurisdiction, `a mere one-time purchaser of goods from a seller in a forum state cannot be constitutionally subject to the exercise of personal jurisdiction by the courts of the forum state.'" Steel Processors, Inc. v. Sue's Pumps, Inc. Rentals, 622 So. 2d 910, 913 (Ala.1993), quoting Borg-Warner, supra, 786 F.2d at 1059. However, I believe this present case is distinguishable from Steel Processors because the evidence in this present case indicates that "other factors tending to support jurisdiction" are present.
The evidence indicates that Phase III initiated all contacts with Collins Signs, which had its place of business in Alabama. Phase III solicited business from Collins Signs and requested that Collins Signs manufacture the desired signage. These contacts are sufficient to support an Alabama court's exercise of personal jurisdiction over Phase III. By contacting Collins Signs, without any solicitation by Collins Signs, Phase III purposefully availed itself of the privileges of conducting business within Alabama. See Hanson v. Denckla, 357 U.S. 235, 253, 78 S. Ct. 1228, 2 L. Ed. 2d 1283 (1958) (stating that "it is essential in each case that there be some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum State.").
Furthermore, other courts have recognized that the defendant's solicitation of business, *1267 and the completion of that business, in the forum state constitute sufficient contacts for the forum state to exercise personal jurisdiction over the defendant. See, e.g., Cancun Adventure Tours, Inc. v. Underwater Designer Co., 862 F.2d 1044 (4th Cir.1988) (holding that a nonresident seller's solicitation to induce the buyer to purchase goods was sufficient); Alchemie Int'l, Inc. v. Metal World, Inc., 523 F. Supp. 1039 (D.N.J.1981). Last, the United States Supreme Court has held that a defendant's one-time solicitation of business in the forum state is sufficient grounds for the exercise of personal jurisdiction over the defendant. McGee v. International Life Ins. Co., 355 U.S. 220, 78 S. Ct. 199, 2 L. Ed. 2d 223 (1957).
Accordingly, I concur in the result. Alabama has jurisdiction over Phase III, but that jurisdiction is specific jurisdictionnot the general jurisdiction the majority finds. The majority cites Ex parte United Brotherhood of Carpenters, 688 So. 2d 246 (Ala.1997), and Ex parte Newco Mfg. Co., 481 So. 2d 867 (Ala.1985), as supporting a conclusion that general jurisdiction exists in this case. 723 So. 2d at 1264. However, in each of those cases, this Court based its conclusion on the defendant's multiple transactions in Alabama, not multiple contacts related to the same transaction from which the cause of action arose. See Brotherhood of Carpenters, 688 So. 2d at 252 (discussing unrelated contacts with Alabama that were continuous and systematic); Newco, 481 So. 2d at 869 ("[T]he instant lawsuit does not relate to or arise from [the defendant's] contacts with Alabama; therefore, [the defendant] is not subject to `specific' jurisdiction in Alabama."). In any event, because the contacts in this case are directly related to the cause of action, the contacts give rise to specific personal jurisdiction.
MADDOX and SEE, JJ., concur. | cbd23554b534879d669c10315e516a8d943d2775d88c07d0d3b986e741f24479 | 1998-11-13 00:00:00 |
2ad3aac4-c5c7-4ccc-bb35-5a87ab612be4 | Ex Parte Barran | 730 So. 2d 203 | 1970679, 1970684, 1970687 | Alabama | Alabama Supreme Court | 730 So. 2d 203 (1998)
Ex parte Emmette L. BARRAN III; Ex parte Kappa Alpha Order, etc., et al.; and Ex parte Duncan Morris.
(Re Jason Jones v. Kappa Alpha Order, Inc., et al.).
1970679, 1970684 and 1970687.
Supreme Court of Alabama.
December 4, 1998.
*204 Robert G. Poole of Whittelsey & Whittelsey, P.C., Opelika, for petitioner Emmette L. Barran III.
Randall Morgan and Doy Leale McCall III of Hill, Hill, Carter, Franco, Cole & Black, P.C., Montgomery, for petitioner Kappa Alpha Order-Nu Chapter.
James A. Rives and Joana S. Ellis of Ball, Ball, Matthews & Novak, P.A., Montgomery, for petitioner Duncan Morris.
April A. England and J.L. Chestnut, Jr., of Chestnut, Sanders, Sanders & Pettaway, P.C., Selma, for respondent.
SEE, Justice.
Jason Jones sued Kappa Alpha Order, Inc. (the "national organization"); Kappa Alpha Order, Inc.Nu Chapter at Auburn University (the "local chapter," or "KA"); and several individual members of KA, alleging, among other things, negligent and wanton hazing in violation of Ala.Code 1975, § 16-1-23, and assault and battery. The trial court granted the defendants' motions for summary judgment on all claims except the assault-and-battery claims against two of the individual members of KA. The trial court made its summary judgment final pursuant to Rule 54(b), Ala. R. Civ. P. Jones Appealed the summary judgment only as it related to his negligence claims. The Court of Civil Appeals affirmed the trial court's summary judgment as to the national organization, but reversed it as to KA and its individual members. The Court of Civil Appeals held that a violation of the criminal-hazing statute constituted negligence per se and common law negligence, and that a jury question existed as to whether Jones voluntarily assumed the risks of hazing. See Jones v. Kappa Alpha Order, Inc., 730 So. 2d 197 (Ala.Civ.App.1997). We granted KA's and the other defendants' petitions for certiorari review. Because we hold that Jones assumed the risks of hazing, we reverse and remand.
Viewed in the light most favorable to Jason Jones, the nonmovant, the evidence indicates that he enrolled at Auburn University in 1993; that in September 1993, Jones chose to become, and became, a pledge of the KA fraternity; that within two days Jones began to experience hazing by the fraternity members; and that the hazing activities continued over the next academic year, and included: (1) having to dig a ditch and jump into it *205 after it had been filled with water, urine, feces, dinner leftovers, and vomit; (2) receiving paddlings to his buttocks; (3) being pushed and kicked, often into walls, pits, and trash cans; (4) eating such foods as peppers, hot sauce, butter, and "yerks" (a mixture of hot sauce, mayonnaise, butter, beans, and other items); (5) doing chores for the fraternity and its members, such as cleaning the fraternity house and yard, serving as designated driver, and running errands; (6) appearing regularly at 2 a.m. "meetings" during which the pledges would be hazed for a couple of hours; and (7) "running the gauntlet," during which the pledges were pushed, kicked, and hit as they ran down a hallway and down a flight of stairs. The evidence further indicates that, despite all of these hazing incidents, and although he was aware that 20% to 40% of the members of his pledge class had elected to withdraw from the pledge program, Jones continued to participate in the hazing, in the hope of becoming a full member of KA; and that Jones continued as a KA pledge and continued to participate in the hazing until Auburn University suspended him from school for poor academic performance.
In October 1995, Jones sued the national and local KA organizations, and several individual members of KA, alleging negligence and/or wantonness, in violation of Ala.Code 1975, § 16-1-23, assault and battery, negligent supervision, conspiracy, and the tort of outrage. Jones alleged that he had suffered "mental and physical injuries" as a result of the hazing engaged in by KA and its members.[1] The trial court granted a motion for summary judgment in favor of each defendant on each claim except for the assault-and-battery claims against Brad Sauls and Jason Hard, KA members. The trial court held that Jones assumed the risk of hazing because he voluntarily entered the pledge class, voluntarily participated in the hazing activities, and could have withdrawn at any time. The trial court made the summary judgment final pursuant to Rule 54(b), Ala. R. Civ. P.[2]
The Court of Civil Appeals affirmed the summary judgment as to the national organization, but reversed it as to Jones's negligence claims against the local chapter and the individual members of the Auburn fraternity. Jones v. Kappa Alpha Order, Inc., supra. The Court of Civil Appeals stated that no Alabama case had recognized the tort of hazing, but then recognized that tort, based on the doctrine of negligence per se and Ala.Code 1975, § 16-1-23, which makes hazing a criminal misdemeanor, and based on a new interpretation of common-law negligence principles. The Court of Civil Appeals then held that the traditional defense of assumption of the risk did not support a summary judgment because the peer pressure associated with fraternity life placed Jones in a coercive environment and thus prevented him from voluntarily withdrawing from the pledge class.
A summary judgment is appropriate when there is no genuine issue of material fact and the moving party is entitled to a judgment as a matter of law. Rule 56, Ala. R. Civ. P.; Vines v. Beloit Corp., 631 So. 2d 1003, 1004 (Ala.1994). A defendant relying on the affirmative defense of assumption of the risk bears the burden of presenting substantial evidence indicating that the plaintiff assumed the risk that gave rise to his injury. Superskate, Inc. v. Nolen, 641 So. 2d 231, 237 (Ala.1994).
KA and its members assert that Jones assumed the risks of the hazing process because, they argue, he consciously and voluntarily participated in the hazing activities. Jones argues that he did not assume the *206 risks, arguing that his participation was "not necessarily voluntary."
Alabama has long recognized the affirmative defense of assumption of the risk. See, e.g., Edwards v. Southern Ry., 233 Ala. 65, 66, 169 So. 715, 715 (1936); Dunklin v. Hanna, 229 Ala. 242, 243, 156 So. 768, 769 (1934); Louisville & N.R.R. v. Parker, 223 Ala. 626, 635, 138 So. 231, 238 (1931). The general principle of assumption of the risk is that "[a] plaintiff who voluntarily assumes a risk of harm arising from the negligent or reckless conduct of the defendant cannot recover for such harm." Restatement (Second) of Torts § 496A (1965). As Prosser and Keeton explain:
Prosser & Keeton, The Law of Torts 481 (5th ed.1984) (footnotes and emphasis omitted).
Assumption of the risk has two subjective elements: (1) the plaintiffs knowledge and appreciation of the risk; and (2) the plaintiffs voluntary exposure to that risk. Driver v. National Security Fire & Casualty Co., 658 So. 2d 390, 393 (Ala.1995). Questions of assumption of the risk are often within the province of the jury, but if there is no genuine issue of material fact, that is, if reasonable persons must draw the same conclusion, then whether the plaintiff has assumed the risk becomes a question of law for the court. See Sears v. Waste Processing Equip., Inc., 695 So. 2d 51, 53 (Ala.Civ.App.1997) (upholding the trial court's holding that a party had assumed the risk of her injuries, as a matter of law). Thus, in order to find, as a matter of law, that Jones assumed the risk, this Court must determine that reasonable persons would agree that Jones knew and appreciated the risks of hazing and that he voluntarily exposed himself to those risks. Id.
First, KA and its members argue that Jones knew and appreciated the risks inherent in hazing. This Court has previously held that the knowledge-and-awareness element of assumption of the risk was satisfied, as a matter of law, where a worker who was injured when he slipped on ice had known that the ice was present on the floor, but continued working. Harris v. Food Equip. Specialist, Inc., 559 So. 2d 1066, 1069 (Ala. 1990). Similarly, in Kemp v. Jackson, 274 Ala. 29, 33, 145 So. 2d 187, 191 (1962), this Court held that the knowledge-and-awareness element of the assumption-of-the-risk defense would be satisfied if a person entered, or continued to ride in, a vehicle with knowledge that the door latch was defective and with an appreciation or consciousness of the hazards involved in doing so.
Jones's deposition indicates that before he became a KA pledge he was unfamiliar with the specific hazing practices engaged in at KA, but that the hazing began within two days of his becoming a pledge; that despite the severe and continuing nature of the hazing, Jones remained a pledge and continued to participate in the hazing activities for a full academic year; that Jones knew and appreciated that hazing was both illegal and against school rules; and that he repeatedly helped KA cover up the hazing by lying about its occurrence to school officials, his doctor, and even his own family. Given Jones's early introduction to the practice of hazing and its hazards, and in light of his own admission that he realized that hazing would continue to occur, the trial court correctly determined that reasonable people would conclude that Jones knew of and appreciated the risks of hazing.[3]
*207 Second, in addition to establishing that Jones both knew of and appreciated the risk, KA and the individual defendants argue that Jones voluntarily exposed himself to the hazing. Jones responds by arguing that a coercive environment hampered his free will to the extent that he could not voluntarily choose to leave the fraternity. The Court of Civil Appeals, in reversing the summary judgment as to KA and the individual defendants, stated that it was not clear that Jones voluntarily assumed the risk of hazing, because, that court stated:
Jones, 730 So. 2d at 200. With respect to the facts in this case, we disagree.
In Driver, 658 So. 2d at 393, this Court stated that the "voluntary" element of assumption of the risk was satisfied where a plaintiff, who was injured in an automobile accident, had put herself in danger by riding in a vehicle operated by someone she knew had been drinking. Similarly, in Skipper v. Shannon, Strobel & Weaver, Inc., 623 So. 2d 1072, 1074 (Ala.1993), this Court stated that the "voluntary" element of assumption of the risk was satisfied where a plaintiff who was injured by tripping over a gap in a floor had put herself in danger by working in an area that she knew was undergoing tile repair.
The record indicates that Jones voluntarily chose to continue his participation in the hazing activities. After numerous hazing events, Jones continued to come back for more two o'clock meetings, more paddlings, and more gauntlet runs, and did so for a full academic year. Auburn University officials, in an effort to help him, asked him if he was being subjected to hazing activities, but he chose not to ask the officials to intervene. Jones's parents, likewise acting in an effort to help him, asked him if he was being subjected to hazing activities, but he chose not to ask his parents for help.
Moreover, we are not convinced by Jones's argument that peer pressure created a coercive environment that prevented him from exercising free choice. Jones had reached the age of majority when he enrolled at Auburn University and pledged the KA fraternity. We have previously noted: "College students and fraternity members are not children. Save for very few legal exceptions, they are adult citizens, ready, able, and willing to be responsible for their own actions." Rothman v. Gamma Alpha Chapter of Pi Kappa Alpha Fraternity, 599 So. 2d 9, 11 (Ala.1992) (quoting Campbell v. Board of Trustees, 495 N.E.2d 227, 232 (Ind.App. 1986)). Thus, even for college students, the privileges of liberty are wrapped in the obligations of responsibility. See Foremost Insurance Co. v. Parham, 693 So. 2d 409, 437-39 (Ala.1997) (See, J., concurring) (discussing the relationship of rights and responsibilities); see, e.g., Flowers v. State, 586 So. 2d 978, 990 (Ala.Crim.App.) (affirming a life sentence for a 15-year-old for the commission of a murder), cert. denied, 596 So. 2d 954 (Ala. 1991) (table), cert. denied, 504 U.S. 930, 112 S. Ct. 1995, 118 L. Ed. 2d 591 (1992).
Jones realized that between 20% and 40% of his fellow pledges voluntarily chose to leave the fraternity and the hazing, but he chose to stay.[4] See Prosser & Keeton, The Law of Torts 491 ("[W]here there is a reasonably safe alternative open, the plaintiffs choice of the dangerous way is a free one, and may amount to assumption of the risk...."). As a responsible adult in the eyes of the law, Jones cannot be heard to argue that peer pressure prevented him from leaving the very hazing activities that, he admits, several of his peers left.[5]
*208 Jones's own deposition testimony indicates that he believed he was free to leave the hazing activities:
We conclude that Jones's participation in the hazing activities was of his own volition. The trial court correctly determined that reasonable people could reach no conclusion other than that Jones voluntarily exposed himself to the hazing.[6]
The trial court correctly entered the summary judgment for the defendants with respect to Jones's negligence claims. Therefore, we reverse that portion of the judgment of the Court of Civil Appeals overturning the summary judgment for the defendants with respect to Jones's negligence claims. We remand the case for an order or proceedings not inconsistent with this opinion.
REVERSED AND REMANDED.
HOOPER, C.J., and MADDOX, HOUSTON, COOK, and LYONS, JJ., concur.
SHORES and KENNEDY, JJ., dissent.
SHORES, Justice, dissenting.
The trial court granted the defendants' motions for summary judgment on claims alleging negligent and wanton hazing in violation of Ala.Code 1975, § 16-1-23. The effect of the main opinion is to affirm the summary judgment. I dissent. I cannot condone a practice that exploits the desire to be admitted to "the fraternity" to the extent it is exploited here. As I understand it, a pledge must be willing to undergo the degrading, disgusting, and, no doubt, health-threatening practices to meet, again, "the fraternity's" high standards for admission. No one should be required to wallow in feces, vomit, urine, and God only knows what else, to gain admission to any "club." The sadness is that so many are willing to do so. I believe the legislature meant to address this practice by enacting § 16-1-23.
KENNEDY, J., concurs.
[1] Although Jones's complaint is ambiguous about the exact nature of some of the injuries he incurred as a result of the hazing, Jones does assert at various points in his brief that he accidentally broke his right hand while "running the gauntlet," that he suffered bruised buttocks from one of the paddlings, that he was "emotionally injured," and that he had to give up his dream of becoming a professional golfer because of his hand injuries.
[2] The assault-and-battery claims, including the claim relating to a fight during which Jones broke his left hand, are still pending in the trial court and are not before this Court.
[3] We note that Jones does not argue to this Court that he lacked knowledge or appreciation of the hazing activities.
[4] An examination of Jones's deposition reveals that one pledge who chose to resign from the pledge class received extra hazing when he announced his intentions. However, that pledge was successful in his withdrawal and received no additional hazing once his association with the fraternity ended. Jones does not assert that fear of a similar reprisal was responsible for his decision to remain a pledge. Further, there is no indication that other resigning pledges received extra hazing.
[5] We note that the peer pressure that may accompany an individual's desire to join a voluntary social organization is a far cry from the economic necessity and inequality in bargaining position that have been used to justify determinations that a child cannot assume the risk of a work-related injury where a child-labor law prohibits his employment. See, e.g., Brilliant Coal Co. v. Sparks, 16 Ala.App. 665, 667, 81 So. 185, 187 (1919) (stating that the defense of assumption of the risk cannot be invoked by a mine operator for injuries to an employee under 16 years of age); Boyles v. Hamilton, 235 Cal. App. 2d 492, 498, 45 Cal.Rptr. 399(1965) (stating that one who employs a child in violation of a statute should not escape responsibility, by reason of the defenses of assumption of the risk or contributory negligence, for injuries sustained by the child).
[6] Because we conclude that Jones assumed the risks of hazing, as a matter of law, we pretermit discussion of whether Alabama should recognize a new tort of "hazing" based on the doctrine of negligence per se or based on common-law principles of negligence. See Ex parte Gentry, 689 So. 2d 916, 920 n. 2 (Ala.1996). | 044fea498972c46b581b415ceabab93fdef56cffd3abd3d3a17066a6b27c3cb7 | 1998-12-04 00:00:00 |
e284584b-1ba4-4fe4-a2b7-63455ba24efb | Life Ins. Co. of Georgia v. Parker | 726 So. 2d 619 | 1951583 | Alabama | Alabama Supreme Court | 726 So. 2d 619 (1998)
LIFE INSURANCE COMPANY OF GEORGIA and James Mark Taunton
v.
James PARKER and Rosie Parker.
1951583.
Supreme Court of Alabama.
November 20, 1998.
Charles E. Vercelli, Jr., and David P. Stevens of Nix, Holtsford & Vercelli, P.C., Montgomery, for appellant.
Milton C. Davis, Tuskegee, for appellees.
LYONS, Justice.
The defendants, Life Insurance Company of Georgia ("Life of Georgia") and its agent James Mark Taunton, appealed from a judgment, based on a jury verdict, awarding compensatory and punitive damages to the plaintiffs, James Parker and his wife Rosie Parker. In our first opinion in this case, *620 Life Insurance Co. of Georgia v. Parker, 706 So. 2d 1108 (Ala.1997) ("Parker I"),[1] we affirmed the judgment insofar as it held the evidence sufficient to support a punitive award, but we remanded the case for the trial court to consider whether the punitive damages award was excessive. Although the trial court apparently had reviewed the punitive damages award for excessiveness, applying the factors set out in Green Oil Co. v. Hornsby, 539 So. 2d 218 (Ala.1989), it did not make written findings as to those factors, and, thus, this Court was unable to review its ruling on the question of excessiveness. On remand, the trial court entered an order stating its findings pursuant to Green Oil, again upholding the jury's award of punitive damages. It has now made its return to our remand order.
We note that, although there was a division among members of this Court in Parker I as to whether certain issues should have been submitted to the jury, a majority of the Court agreed that the evidence supported the trial court's denial of the defendants' motions for a judgment as a matter of law. We do not revisit today the issues that were before us in Parker I; the only issue before us now is whether the punitive damages award is excessive. This point of departure assumes that the jury properly could have awarded some measure of punitive damages.
The facts of this case were set out at length in Parker I, and we will restate only those that are most important. In 1993, Taunton, acting as an agent for Life of Georgia, visited the Parkers to conduct a "policy review"; he learned that they held three Life of Georgia life insurance policies. James Parker, age 70, had two paid-up policies in the amounts of $1,000 and $500, while his wife, age 68, had one paid-up policy in the amount of $1,000. Taunton was aware that all three policies would pay the full face amount upon the Parkers' deaths. He also was aware that, based upon their ages and their health, the Parkers could qualify only for graded-death-benefits policies; i.e., policies that would require them to pay premiums for a minimum of three years before the policies would be worth their full face value. According to Mrs. Parker, Taunton represented to the Parkers that if they would cash in James Parker's $500 policy and buy two $1,000 policies, Taunton could "even up" their coverage so that both of them would have $2,000 in coverage at the time of their deaths. Taunton did not reveal to the Parkers that the new $1,000 policies would be graded-death-benefits policies. The Parkers, believing they were buying whole-life policies, signed the applications for the new coverage. Taunton represented to the Parkers that, by cashing in James Parker's $500 policy, they would receive "four hundred and something" dollars within a few weeks. Because their discussion with Taunton occurred shortly before Christmas, the Parkers had a special need for the money, and Taunton's representations helped convince them to cash in the $500 whole-life policy. In reality, the Parkers were due only $141.17 for the cash value of the policy.
Taunton did not immediately execute the paperwork necessary to cash in the $500 policy, so the Parkers did not receive any money from it until January. Taunton joined the premiums for the two new policies he had sold to the Parkers with the premiums for their existing policies, which they had bought in 1981. The Parkers ultimately were unable to pay even the first of the increased premiums on the two new $1,000 policies. The new policies lapsed, and the two existing policies were converted into policies with lesser coverage. James Parker's 1981 policy converted into "extended term insurance"; that is, Life of Georgia used the net cash value of the policy to purchase term insurance that would pay the full $1,000 benefits upon James Parker's death, but only if he died within three years. Beyond that period, he had no coverage. Rosie Parker's 1981 policy converted to "reduced paid-up" statusthat is, the cash value of her policy was lessened although the same policy period remained in effect. The elderly Parkers' meager *621 life insurance portfolio thus was eroded by Taunton's efforts to sell them more coverage.
Based upon these facts, as explained in further detail in Parker I, the jury returned a verdict for the Parkers on their claims of intentional misrepresentation and fraudulent suppression of material facts, awarding them $4,276 in compensatory damages and $200,000 in punitive damages.
The defendants argue that the punitive damages award was excessive and thus violated their right to due process under the Fourteenth Amendment of the United States Constitution. BMW of North America, Inc. v. Gore, 517 U.S. 559, 116 S. Ct. 1589, 134 L. Ed. 2d 809 (1996) ("BMW I"). In BMW I, the United States Supreme Court reversed this Court's affirmance of a large punitive damages award in a case in which the purchaser of an automobile had suffered a relatively small economic loss. The Supreme Court established the rule that a defendant in a civil action has a due-process right to notice as to what measure of punitive damages can be assessed for that defendant's alleged wrongdoing. In providing three guideposts by which to review the question of excessiveness of a punitive-damages award, the majority in BMW I did not overrule the review process already established by this Court in Hammond v. City of Gadsden, 493 So. 2d 1374 (Ala.1986), and Green Oil, 539 So. 2d at 223-24. In BMW of North America, Inc. v. Gore, 701 So. 2d 507 (Ala.1997) (on remand from the Supreme Court of the United States) ("BMW II"),[2] we noted that "[a]s we read the BMW [I] opinion, the United States Supreme Court's guideposts are not intended to exclude judicial consideration of other factors that might bear on the question of excessiveness." 701 So. 2d at 510.
The defendants challenge the punitive damages award both on the basis of the "guideposts" established by the United States Supreme Court in BMW I and on the basis of the factors this Court set out in Hammond and Green Oil. In other words, they collectively argue that the award exceeds any amount justified by the evidence and thus is a denial of due process.[3]
We begin with an analysis of the guideposts established by the United States Supreme Court in BMW I.
"Perhaps the most important indicium of the reasonableness of a punitive damages award is the degree of reprehensibility of the defendant's conduct." BMW I, 517 U.S. at 575, 116 S. Ct. 1589. Although the Supreme Court did not provide any particular yardstick by which to measure reprehensibility, it did acknowledge that trickery and deceit are more reprehensible than negligence, and that acts of affirmative misconduct, such as making deliberate false statements, are more reprehensible than making an innocent misrepresentation. The Supreme Court further recognized that economic damage inflicted upon a financially vulnerable plaintiff might well support a large punitive-damages award. BMW I, 517 U.S. at 576, 116 S. Ct. 1589.
The crux of this case is Life of Georgia's marketing of insurance to customers who were particularly vulnerable because of their age, their lack of formal education, and their financial status. See Parker I, 706 So. 2d at 1112. Although the record contains little evidence relating to the exact level of James Parker's understanding of insurance,[4]*622 the jury could have concluded that the Parkers did not have Taunton's level of understanding as to what the consequences could be if they followed his advice to "even up" their coverage by cashing in one of their full benefit policies to buy two graded-death-benefits policies that they could not afford. The record contained evidence indicating that Taunton, as Life of Georgia's agent, had superior knowledge of the terms of the policies he sold. Taunton's years of experience in selling insurance, as well as his superior knowledge, placed upon him the duty to inform the Parkers, at the very least, of what kind of insurance they were buying. The evidence shows that, based upon Taunton's misrepresentations as to the kind of insurance he was selling to the Parkers, they were induced to buy more insurance and ultimately ended up with less coverage than they had before they were induced to act. Moreover, the jury apparently chose to believe Rosie Parker when she testified as to the assurances she said Taunton made to her about the amount of money the Parkers would receive upon surrendering James Parker's $500 policy.
We note, however, that there is a marked lack of evidence indicating any malicious intent on Taunton's part; indeed, in a time when seven-figure awards against insurance companies in fraud cases receive great notoriety, the fact that the jury awarded punitive damages of only $200,000 is more consistent with a finding of recklessness than with a finding that Taunton had an intent to harm the Parkers. Viewed in this light, the defendants' conduct should not be regarded as having been highly reprehensible.
A second indicium of either reasonableness or excessiveness is the ratio of the punitive-damages award to the actual harm inflicted upon the plaintiff. BMW I, 517 U.S. at 580, 116 S. Ct. 1589. The guaranty of due process does not require that we apply a purely mathematical formula in determining whether a punitive-damages award is excessive; therefore, in most cases, a remittitur will not be justified solely on the basis of a high ratio. However, a general concern of reasonableness properly enters into the constitutional calculus. BMW I, 517 U.S. at 582-83, 116 S. Ct. 1589 (quoting TXO Production Corp. v. Alliance Resources Corp., 509 U.S. 443, 113 S. Ct. 2711, 125 L. Ed. 2d 366 (1993)). A higher award may be justified in a case in which the injury to the plaintiff is hard to detect or the monetary compensation for noneconomic harm is difficult to determine. Id. This Court has found constitutionally acceptable ratios ranging from 1:1 in Ford Motor Co. v. Sperau, 708 So. 2d 111 (Ala.1997), to 121:1 in Foremost Ins. Co. v. Parham, 693 So. 2d 409 (Ala.1997). The facts of those cases, and of cases in which ratios of punitive damages to compensatory damages fall between those of Sperau and Foremost, are varied and reflect the wisdom of this Court's refusal to draw a mathematical bright line to apply in every case.
In this case, the punitive damages award of $200,000 is 46.77 times the compensatory damages award of $4,276. Although the harm to the Parkers for which they were compensated was comparatively small, the Parkers were both financially vulnerable and elderly, so that the economic loss, including the reduction of their insurance coverage as a result of Taunton's actions, had a more severe impact upon them than it might have had upon younger, more affluent customers. Under these circumstances, we conclude that a somewhat higher ratio of punitive damages to compensatory damages may be justified.
We must consider a third indicium of reasonableness or excessiveness, a comparison of the punitive-damages award and the civil or criminal penalties that could be imposed for comparable misconduct. BMW I, 517 U.S. at 583, 116 S. Ct. 1589. The maximum statutory sanction against insurance fraud in this state is only $1,000. As this Court has *623 noted, "[b]ecause the legislature has set the statutory penalty for deceitful conduct at such a low level, there is little basis for comparing it with any meaningful punitive damages award." BMW II, 701 So. 2d at 514. Alabama has no criminal laws against insurance fraud.
After reviewing the evidence and analyzing the BMW I guideposts, we find, based upon the relatively low level of reprehensibility presented here, coupled with our uneasiness over the rather high 46.77:1 ratio of punitive damages to compensatory damages, an indication that the punitive-damages award was excessive.
We now consider the factors established by this Court in Hammond and Green Oil.
"`Punitive damages should bear a reasonable relationship to the harm that is likely to occur from the defendant's conduct as well as to the harm that actually has occurred. If the actual or likely harm is slight, the damages should be relatively small. If grievous, the damages should be much greater.'" "Green Oil, 539 So. 2d at 223 (quoting Aetna Life Ins. Co. v. Lavoie, 505 So. 2d 1050, 1062 (Ala.1987) (Houston, J., concurring specially)).
As a result of the defendants' misconduct, the Parkers were induced to purchase insurance they could not afford, and the premiums for the new policies were added into the premiums they were paying on their existing policies. When the Parkers were unable to pay the increased premiums and the new policies lapsed, their existing policies were converted into lesser coverage. See Parker I, 706 So. 2d at 1111. Moreover, based upon the defendants' misconduct, the Parkers cashed in a $500 full-benefit policy that they otherwise would have kept. Although the actual amount of their losses was not large, the fact that the Parkers were financially vulnerable made the losses more serious. We conclude that the degree of harm resulting from the defendants' conduct supports the imposition of more than token punitive damages. This factor thus weighs against a finding that the punitive-damages award was excessive.
Although we discussed this factor in our review of the BMW I guideposts, we note that in a Hammond /Green Oil review we assess the reprehensibility of a defendant's conduct by considering "`[t]he duration of this conduct, the degree of the defendant's awareness of any hazard which his conduct has caused or is likely to cause, and any concealment or "cover up" of that hazard, and the existence and frequency of similar past conduct.'" Green Oil, 539 So. 2d at 223. We have concluded that the defendants' misconduct resulted in damage to the Parkers that would correspond with a significant punitive-damages award; however, we note that the record does not indicate a pattern of like misconduct, and it does not contain evidence indicating that the defendants sought to "cover up" the misconduct. The reprehensibility of Taunton's misconduct lies in the fact that it resulted in a loss to the financially vulnerable Parkers, with whom he dealt recklessly, not in any demonstrated malicious intent to defraud the Parkers for profit. Compare Foster v. Life Insurance Co. of Georgia, 656 So. 2d 333 (Ala.1994) (agent intentionally sold worthless Medicare-supplement policy to uneducated and financially vulnerable Medicaid recipient); Life Insurance Co. of Georgia v. Johnson, 701 So. 2d 524 (Ala.1997) (agent engaged in intentional and reckless fraud and fraudulent suppression in selling worthless Medicare-supplement policy to elderly woman). Thus, while the misconduct at issue would support a significant punitive-damages award, we reiterate that it does not reflect the degree of reprehensibility, often marked by greed, that has been the basis of large punitive-damages awards in the past. This factor thus weighs against a finding that the punitive-damages award is excessive.
If a Hammond /Green Oil review indicates that the wrongful conduct was profitable to *624 the defendant, we are required to determine whether the punitive-damages award removes the profit and whether it exceeds the profit so that the defendant recognizes a loss. Green Oil, 539 So. 2d at 223. The evidence shows that Life of Georgia gained little, if any, profit from Taunton's sale of the two $1,000 policies because the Parkers were unable to pay even the first premiums on them.[5] Taunton's commission on the sale was nominal. Clearly, the punitive-damages award removes any profit the defendants realized and so far exceeds it that the defendants would recognize a loss. This factor thus weighs in favor of a finding that the punitive-damages award is excessive.
There is no specific evidence before this Court as to the net worth of either defendant at the time the jury awarded the damages, and the trial court's findings upon remand are silent as to the financial position of the defendants. No argument has been advanced as to the adverse effect of the award on either defendant. This factor thus weighs against a finding that the punitive-damages award is excessive.
In a Hammond /Green Oil review, we must consider whether the punitive-damages award was sufficient to reward the plaintiff's counsel for assuming the risk of bringing the lawsuit and to encourage other victims of wrongdoing to come forward. The trial court's findings upon remand are silent as to this factor. The record in this case reflects pretrial proceedings culminating in a two-day trial before a jury, and thereafter extensive posttrial and appellate proceedings, together with thorough briefs on both the initial appeal and on this return to the remand. The Parkers clearly incurred substantial litigation costs in order to recover on a relatively small out-of-pocket claim. Under the totality of the circumstances concerning the cost of litigation, this factor weighs against a finding that the punitive damages award is excessive.
No criminal sanctions have been imposed on Life of Georgia or Taunton; therefore, this factor is inapplicable here.
In its findings on remand, the trial court stated:
The trial court also pointed out: "By the very nature of the [insurance] business, there are fairly low-paid agents who may be largely untrained, who are not subjected to strict standards by the employer or the state, who are assigned debit routes, and must produce. The company knows this." We agree that Life of Georgia's past misconduct, for which it has been punished in other proceedings, places the company on notice of the punishment that it could receive for similar misconduct. However, Taunton's actions on Life of Georgia's behalf reflect a markedly lower degree of reprehensibility than that present in other cases that have resulted in large punitive-damages awards against Life of Georgia. See Foster v. Life Insurance Co. of Georgia, supra; Life Insurance Co. of Georgia v. Johnson, supra. The record does not indicate that any other civil actions have been filed against the defendants based on the level of misconduct present here; other cases against Life of Georgia that this Court has reviewed involved a far greater degree of reprehensibility. This factor thus weighs in favor of a finding that the punitive damages award is excessive.
After considering the seven Hammond /Green Oil factors, we conclude as follows:
*625 Three of the factors weigh in favor of a finding of excessiveness: the degree of reprehensibility of the defendants' conduct, the degree to which the defendants profited, and the other civil actions against them. Three of the factors weigh against a finding of excessiveness: the relationship of the damages award to the harm done to the Parkers, the defendants' financial position, and the costs of litigation. One of the factors is inapplicable.
We began our review in this case by considering the due-process guideposts set out by the United States Supreme Court in BMW I, and we concluded that those guideposts indicated that the punitive-damages award in this case was excessive. We continued our review by considering the Hammond /Green Oil factors. Of the six factors applicable to this case, three of them weighed against a finding that the punitive-damages award was excessive. We now return to a final consideration of the question of excessiveness of the punitive-damages award in light of BMW I. A punitive-damages award of $150,000 would reduce the ratio of punitive damages to compensatory damages from 46.77:1 to 35:1. Based on the level of reprehensibility of the misconduct evidenced in this case, coupled with the financial vulnerability of the plaintiffs and the litigation costs incurred, we conclude that a $150,000 punitive-damages award is sufficient to punish the defendants and to deter them from further misconduct similar to that evidenced in this case, without compromising their due-process rights.
The judgment is affirmed, on the condition that the Parkers file with this Court within 21 days a remittitur of punitive damages to the sum of $150,000; otherwise, the judgment will be reversed and the cause remanded for a new trial.
AFFIRMED CONDITIONALLY.[*]
HOOPER, C.J., and MADDOX, SHORES, HOUSTON, and COOK, JJ., concur.
ALMON and KENNEDY, JJ., concur in the result.
SEE, J., dissents.
SEE, Justice (dissenting).
I must respectfully dissent from the majority's holding in this appeal only as to the issue of the excessiveness of the punitive damages award. The majority approves an award having a ratio of punitive damages to compensatory damages of 35:1 "[b]ased on the level of reprehensibility in the misconduct evidenced in this case, coupled with the financial vulnerability of the plaintiffs and the litigation costs incurred...." 726 So. 2d at 625. The majority recognizes that the conduct in this case is not highly reprehensible. Id. at 623. While I agree that in an appropriate case litigation costs can justify an enhancement of punitive damages in order to compensate the victims' attorneys, the Hammond /Green Oil findings in this case do not support such an enhancement. As the majority recognizes, "[t]he trial court's findings upon remand are silent as to this factor." Id. at 624. I am unwilling to speculate.
Because of the absence of highly reprehensible conduct and the absence of findings supporting a specific supplemental award to cover the litigation costs, I would approve an award bearing a 3:1 ratio of punitive damages to compensatory damages based on the rationale set forth in my writing in Life Ins. Co. of Georgia v. Johnson, 701 So. 2d 524, 535 (Ala.1997) (See, J., concurring in part and dissenting in part). Accord Union Sec. Life Ins. Co. v. Crocker, 709 So. 2d 1118, 1124 (Ala.1997) (See, J., dissenting) (noting the arbitrary amounts of punitive awards approved by this Court since BMW of North America, Inc. v. Gore, 517 U.S. 559, 116 S. Ct. 1589, 134 L. Ed. 2d 809 (1996)).
I therefore dissent.
[1] James Mark Taunton was not named as an appellant in the style of Parker I. Nevertheless, after reviewing the record and the briefs submitted in this case, we find it clear that both Taunton and Life of Georgia appealed from the judgment against them.
[2] We note that this case was tried in February 1996, well before the opinion of this Court in BMW II was released on May 9, 1997. As was the case in BMW II, no claim for damages for mental anguish was asserted in this case.
[3] Indeed, we do not consider that a challenge, pursuant to BMW I, to the constitutionality of a punitive-damages award is a necessary prerequisite to trigger this Court's review under Hammond /Green Oil. The Hammond /Green Oil review is available at the defendant's request, and a punitive-damages award need not be found to be so excessive as to violate the due-process guaranty for it to be found excessive based upon the sufficiency of the evidence.
[4] The dissenters in Parker I were disturbed over James Parker's failure to testify at trial and suggested that he had a degree of sophistication that would have made the plaintiffs' case weaker. Of course, the defendants could have called James Parker as a hostile witness.
[5] However, as the trial court pointed out in its findings on remand, Life of Georgia would have benefited from the sale had the Parkers been able to pay the premiums.
[*] Note from the reporter of decisions: An entry on the Supreme Court's docket indicates that on November 23, 1998, the appellees filed a "consent and acceptance of remittitur of punitive damages." | d48defa53003eab1f5b5bf990ed295f745000ea24522ad5309d7096cde4e08c9 | 1998-11-20 00:00:00 |
49f1a6fc-f7d3-44bc-aa91-d3b3969d1104 | Ex Parte P&H Const. Co., Inc. | 723 So. 2d 45 | 1971319 | Alabama | Alabama Supreme Court | 723 So. 2d 45 (1998)
Ex parte P&H CONSTRUCTION COMPANY, INC.
(In re Norman Barber et al. v. State of Alabama et al.; and
Ben Jernigan
v.
State of Alabama et al.).
1971319
Supreme Court of Alabama.
November 6, 1998.
*46 Jannea S. Rogers and Carroll H. Sullivan of Clark, Scott & Sullivan, P.C., Mobile, for petitioner P&H Construction Company, Inc.
Jerry L. Wiedler, Montgomery; Jim R. Ippolito, Jr., chief counsel, Alabama Department of Transportation; and R. Mitchell Alton III and Stacy S. Houston, counsel, Alabama Department of Transportation, for the State of Alabama.
Herndon Inge III and John W. Parker, Mobile, for respondents Wharfhouse Restaurant and Oyster Bar, Inc., and Ben Jernigan.
Tabor R. Novak, Jr., and E. Hamilton Wilson, Jr., of Ball, Ball, Matthews & Novak, P.A., Montgomery, for respondent McInnis Corporation.
LYONS, Justice.
P&H Construction Company, Inc. ("P&H"), petitions for a writ of mandamus directing Judge William Gordon of the Montgomery Circuit Court to enter an order dismissing P&H as a third-party defendant from two cases pending in the circuit court. For the reasons discussed below, we grant the petition.
The underlying litigation arose when Norman Barber and Brenda Barber, in one action, and Ben Jernigan, in another action, sued the State of Alabama and McInnis Corporation ("McInnis"), a company performing on a contract with the State. The Barbers and Jernigan, in the two separate actions, claimed that the State and McInnis had damaged their property while constructing the Dog River Bridge in Mobile County. The Barbers and Jernigan alleged that McInnis had negligently or wantonly damaged their property when it drove the piles for the bridge.[1] Because McInnis had subcontracted the pile-driving operation for the bridge construction to P&H, McInnis filed a third-party complaint against P&H, seeking contractual indemnity. Neither the Barbers nor Jernigan sued P&H.
Each defendant moved for a summary judgment. P&H directed its motion against the Barbers' claims, Jernigan's claims, and McInnis's third-party complaint.[2] The trial court entered a summary judgment in favor of the State, McInnis, and P&H on the Barbers' claims and Jernigan's claims and entered a summary judgment in favor of P&H on McInnis's third-party claim. The Barbers and Jernigan appealed from the summary judgment entered against them. However, McInnis did not appeal the summary judgment entered against it on its third-party complaint.
On appeal, this Court affirmed in part and reversed in part the summary judgments on the Barbers' claims and Jernigan's claims and remanded the case to the trial court. Barber v. State, 703 So. 2d 314 (Ala. 1997) ("Barber I"). This Court concluded: "[T]here was insufficient evidence to submit the negligence and wantonness claims to a jury, to the extent that those claims were based on damage that may have been done to the property by the pile-driving operations *47 performed by the subcontractor. The undisputed evidence indicates that the pile-driving operations conformed to generally accepted pile-driving practices." Id. at 323.
On remand, P&H participated in the scheduling conference and in court-ordered, nonbinding mediation. Several months later, at a pretrial hearing, P&H filed a "motion to declare it a nonparty."[3] The trial court denied P&H's motion, stating that McInnis's claims against P&H, other than claims related to pile driving, were viable. P&H then moved to stay the trial and filed this petition for the writ of mandamus.
A writ of mandamus is an extraordinary remedy, and it will be "issued only when there is: (1) a clear legal right in the petitioner to the order sought; (2) an imperative duty upon the respondent to perform, accompanied by a refusal to do so; (3) the lack of another adequate remedy; and (4) properly invoked jurisdiction of the court." Ex parte United Service Stations, Inc., 628 So. 2d 501, 503 (Ala.1993). A petition for the writ of mandamus is a proper means for seeking appellate review of a trial court's order denying a motion to dismiss a complaint. Ex parte Alabama Dep't of Forensic Sciences, 709 So. 2d 455 (Ala.1997).
P&H argues that it has a clear legal right to dismissal because, it argues, the trial court's summary judgment entered against McInnis on McInnis's third-party complaint was a final judgment from which McInnis did not appeal. However, McInnis argues that because this Court remanded Barber I to the trial court, this Court intended to exercise an appellate court's "discretionary power to retain all parties in the lawsuit [on] remand ... to insure an equitable resolution at trial." Bryant v. Technical Research Co., 654 F.2d 1337, 1342 (9th Cir.1981). P&H counters with the argument that this Court never had appellate jurisdiction over McInnis's third-party complaint because McInnis did not file a notice of appeal. McInnis contends that the Alabama Rules of Appellate Procedure do not require a third-party plaintiff to file a "protective, conditional or provisional appeal in order to preserve its right [to a derivative claim] against a third-party defendant." McInnis says that the timely filing of a notice of a protective cross-appeal is not jurisdictional but is a "rule of practice" that can be waived or suspended in certain circumstances.
The issue whether a third-party plaintiff is required to file an appeal in order to protect its claim of derivative liability is one of first impression in Alabama. However, we are not completely without controlling authority. This Court has held that a timely notice of appeal is a mandatory jurisdictional act. Holmes v. Powell, 363 So. 2d 760, 761 (Ala.1978); see, also, Committee Comments to Rule 3, Ala. R. App. P. ("[t]imely filing of the notice of appeal is a jurisdictional act"). Rule 4(a)(1), Ala. R. App. P., sets the time allowed for filing a notice of appeal, in any appeal by right and from a final judgment, at 42 days. Rule 4(a)(2), Ala. R. App. P., provides an additional 14 days after the date of the filing of a notice of appeal for the filing of a notice of a cross-appeal. Furthermore, we consider persuasive those federal cases construing Rules 3 and 4 of the Federal Rules of Appellate Procedure, which are very similar to Rules 3 and 4 of the Alabama Rules. We find the decision of the United States Court of Appeals for the Seventh Circuit in Young Radiator Co. v. Celotex Corp., 881 F.2d 1408 (7th Cir.1989), to be especially persuasive. Young Radiator involved facts and issues very similar to those presented to us in the instant case.
Young Radiator sued Celotex, the manufacturer of the roofing system on Young Radiator's building, based on damage resulting from a leaky roof. 881 F.2d at 1409. Seeking contribution, Celotex sued, as third-party defendants, the architect, the general contractor, and the roofing subcontractor who had worked on the roofing system. Id. at *48 1409-10. Celotex and the third-party defendants moved for a summary judgment; the trial court entered a summary judgment in favor of Celotex on Young Radiator's claims and against Celotex on the third-party defendants' claims. Id. Young Radiator timely filed a notice of appeal from the summary judgment entered against it; however, Celotex did not file a notice of a cross-appeal from the summary judgment entered against it and in favor of the third-party defendants. Id.
The Seventh Circuit addressed the issue "whether, in the absence of a Rule 4(a)(3)[4] notice of appeal, Celotex may challenge the judgment entered for the third-party defendants." 881 F.2d at 1415. The Seventh Circuit first noted that a split of authority existed over the question whether filing a notice of a cross-appeal was a mandatory, jurisdictional act or was a rule of practice. The court then followed the United States Supreme Court's decision in Torres v. Oakland Scavenger Co., 487 U.S. 312, 108 S. Ct. 2405, 101 L. Ed. 2d 285 (1988), holding that the requirements of Rules 3 and 4, Fed. R. App. P., are mandatory and jurisdictional.[5] Accordingly, the Seventh Circuit held that Celotex's failure to file a notice of cross-appeal could not be disregarded.
Like the United States Supreme Court, this Court has treated the filing of a notice of appeal as a mandatory jurisdictional act. Holmes, supra, 363 So. 2d at 761. Therefore, we adopt the Seventh Circuit's rationale and hold that a timely filing of a notice of a cross-appeal to protect one's rights is a mandatory jurisdictional act and not a rule of practice. This rule applies not only in cases involving derivative liability, but also in any case where a cross-appeal is necessary to protect a party's rights. However, we are not here presented with the consequences of filing a defective notice. The Committee Comments to Rule 3, Ala. R. App. P., suggest that the action, if any, taken on a defective notice of appeal is within the appellate court's discretion:
Applying our holding to this case, we conclude that when the Barbers and Jernigan filed their appeal in Barber I McInnis was required to file a notice of a cross-appeal in order to protect its claim of derivative liability against P&H. Absent that notice of a cross-appeal, the trial court's judgment in favor of P&H could not be disturbed. Accordingly, the trial court erred in setting aside its judgment entered in favor of P&H and in holding that McInnis could assert claims for indemnity from P&H.[6]
McInnis argues that even if it should have cross-appealed from the judgment entered against it, the trial court, upon remand, *49 had the authority to alter or amend the judgment under Rule 60(b), Ala. R. Civ. P. However, Rule 60(b) requires that a party move for relief from a judgment, and does not provide for sua sponte relief by the trial court.[7] McInnis did not move for relief under Rule 60(b). Therefore, the trial court could not have granted relief on that basis from its judgment.
McInnis also requests leave from this Court to file with the trial court a Rule 60(b) motion for relief from the judgment. Because we are granting P&H's petition, this request is moot. Furthermore, to the extent this motion is based upon McInnis's failure to file a timely notice of a protective cross-appeal, we note that Rule 60(b) relief cannot be a substitute for an appeal. See Harper Plastics, Inc. v. Replex Corp., 382 So. 2d 556, 557 (Ala.1980).
We conclude that McInnis's failure to timely appeal from the summary judgment entered against it and in favor of P&H required that that judgment be enforced. Accordingly, P&H has a clear legal right to be dismissed as a third-party defendant, and the trial court had a duty to order that dismissal. Because the trial court refused to enforce its judgment, we grant P&H's petition for the writ of mandamus. Judge Gordon is directed to dismiss P&H as a defendant on McInnis's third-party claim.
WRIT GRANTED.
HOOPER, C.J., and MADDOX, ALMON, SHORES, HOUSTON, KENNEDY, and SEE, JJ., concur.
COOK, J., concurs in the result.
[1] For a complete list of the allegations against the State and McInnis, see the opinion on the previous appeal in this case. Barber v. State, 703 So. 2d 314 (Ala.1997).
[2] P&H says that it challenged the Barbers' claims and Jernigan's claims, even though they had not sued it, because their claim regarding the pile driving affected McInnis's third-party claim.
[3] Because the Alabama Rules of Civil Procedure do not provide for a "motion to declare a nonparty," we treat P&H's motion as one to dismiss under the "law of the case." "Under the doctrine of the `law of the case,' whatever is once established between the same parties in the same case continues to be the law of that case, whether or not correct on general principles, so long as the facts on which the decision was predicated continue to be the facts of the case." Blumberg v. Touche Ross & Co., 514 So. 2d 922, 924 (Ala. 1987).
[4] Rule 4(a)(3), Fed. R. App. P., like Rule 4(a)(2), Ala. R. App. P., provides the time limits for a cross-appeal.
[5] In Torres, a notice of appeal was filed on behalf of 16 plaintiffs. 487 U.S. at 313, 108 S. Ct. 2405. Because of a clerical error, one of the plaintiffs was omitted from the notice of appeal. Id. The Supreme Court held that this omission could not be waived, because Rules 3 and 4, Fed. R. App. P., are mandatory and jurisdictional. 487 U.S. at 315-16, 108 S. Ct. 2405.
We are aware that the Torres holding has been partially superseded by an amendment to Rule 3, Fed. R. App. P., which allows attorneys representing several similarly situated clients to use designations such as "all plaintiffs" or "the defendants" in the notice of appeal. By the amendment, the rule also deems the notice sufficient when it is "objectively clear that a party intended to appeal." Rule 3, Fed. R. App. P., Advisory Committee Notes. However, this amendment addressed the sufficiency of the notice of appeal and did not change the rule that the actual filing of a notice of appeal is mandatory and jurisdictional. See Kelly v. Foti, 77 F.3d 819, 822 (5th Cir.1996) (citing Northwest Airlines v. County of Kent, 510 U.S. 355, 364, 114 S. Ct. 855, 127 L. Ed. 2d 183 (1994)). Furthermore, the Alabama Rules of Appellate Procedure have not been so amended.
[6] Because Rule 14(a), Ala. R. Civ. P., applies only to claims against a party who is or may be liable for all or part of the plaintiff's claim against the third-party plaintiff, the scope of the preclusion by reason of McInnis's failure to appeal should be limited to McInnis's claims grounded upon a right of indemnity. Compare Rule 13(g), Ala. R. Civ. P., regarding cross-claims, where the scope of the claim is not so limited.
[7] Rule 60(a), Ala. R. Civ. P., does allow the trial court to act sua sponte to correct clerical mistakes; however, nothing in this case indicates that the trial court corrected a clerical mistake. Instead, the trial court set aside its earlier summary judgment. | e4ce3a4820de321e4716c1381a15875b903e59e3638df7dda4ae7cd332bcd756 | 1998-11-06 00:00:00 |
f89451ce-cea6-4e24-89c1-830496ee535c | Ex Parte Belue | 727 So. 2d 785 | 1970121 | Alabama | Alabama Supreme Court | 727 So. 2d 785 (1998)
Ex parte Donald Ray BELUE.
(Re Donald Ray Belue v. State).
1970121.
Supreme Court of Alabama.
September 11, 1998.
*786 Bryce U. Graham, Jr., Tuscumbia, for petitioner.
Bill Pryor, atty. gen., and Rosa H. Davis, asst. atty. gen., for respondent.
ALMON, Justice.
A jury convicted Donald Ray Belue of first-degree rape, first-degree sodomy, and first-degree burglary, in violation of Ala.Code 1975, §§ 13A-6-61, 13A-6-63, and 13A-7-5. Under the Habitual Felony Offender Act, the circuit court sentenced him to life imprisonment without the possibility of parole and ordered him to pay $15,258.25 in restitution.
After Belue was sentenced, his trial attorney withdrew and the circuit court appointed a new attorney. The new attorney moved for a new trial, and the circuit court scheduled a hearing on the motion. The attorney also filed a motion requesting that Belue be transported from the state penitentiary, where he had begun serving his life sentence, to the local jail so that he could be present for the hearing on his motion for a new trial. However, on the day set for the hearing, it was discovered that the wrong case number had been affixed to the motion to have him transported from the prison; because of that error, the circuit court had not acted on the motion. The new attorney, objecting to the court's conducting the hearing in Belue's absence, moved for a continuance. The circuit court denied a continuance and conducted the hearing without Belue being present.
At the hearing, the new attorney argued that Belue's trial attorney had been ineffective and that Belue was therefore entitled to a new trial. The new attorney supported his argument by alleging four separate instances in which he contended that the trial attorney's performance had been constitutionally deficient. Specifically, he alleged: (1) that the trial attorney did not strike a jurorwho ultimately sat on the juryafter she had admitted during voir dire examination that she was prejudiced against Belue; (2) that the attorney failed to produce Belue's military records, which the new attorney said would have shown that Belue's blood type was different from the blood type the State contended he had; (3) that the attorney did not use at trial two DNA experts that he had consulted regarding the technical process of DNA matching; and (4) that the attorney failed to ask for a continuance so that the DNA experts could examine discovery material the State provided after the jury was impanelled.
Belue's trial attorney was the only witness who testified at the hearing. His testimony, which spans 32 pages in the record, generally refuted the allegation that he had rendered ineffective assistance of counsel. However, he did state that he felt he should have asked for a continuance to allow DNA experts to examine discovery material the State had provided just before trial. In responding to the contention that he should have struck the juror who admitted prejudice against Belue, the attorney flatly contradicted the allegation that Belue had specifically asked him to strike the juror. He testified that he had consulted with Belue about that particular juror and that they had concluded that the juror should remain on the venire. Because Belue was not present at the hearing to either confirm or deny these statements, his trial attorney's testimony was unrefuted.
After concluding the hearing, the circuit court denied the motion for a new trial. The Court of Criminal Appeals affirmed, with an unpublished memorandum. Belue v. State, 725 So. 2d 1075 (Ala.Crim.App.1997) (table).
In its unpublished memorandum, the Court of Criminal Appeals first stated that a hearing on a motion for a new trial has been held to be a critical stage of the proceedings against a criminal defendant. See, e.g., King v. State, 613 So. 2d 888, 889-91 (Ala.Crim. App.1993). Additionally, because the hearing involved a factual dispute concerning the effectiveness of Belue's trial attorney, the Court of Criminal Appeals held that Belue was entitled to be present at the hearing, in order to be able to confront the witnesses against him. See Kentucky v. Stincer, 482 U.S. 730, 107 S. Ct. 2658, 96 L. Ed. 2d 631 (1987). However, after concluding that Belue had a right to be present at the hearing on his motion for a new trial, that court quoted Ex parte Stout, 547 So. 2d 901, 904 (Ala.1989), for the proposition that "`even improper exclusion of a defendant from a *787 "critical" portion of the trial does not automatically require reversal, if in the particular case the defendant's absence was harmless beyond a reasonable doubt'" (quoting Polizzi v. United States, 550 F.2d 1133, 1138 (9th Cir.1976)). The Court of Criminal Appeals then, stating that Belue had not demonstrated any possibility of prejudice resulting from his absence, held that the circuit court's denying him his right to be present at the hearing was harmless error.
We granted Belue's petition for certiorari review in order to determine whether the denial of his right to be present at the hearing on his motion for a new trial was indeed merely harmless error.
There is no dispute that Belue had a right to be present at the hearing on his motion for a new trial. Article I, § 6, Ala. Constitution of 1901, provides:
Also, the right to confront witnesses is guaranteed by the Sixth Amendment to the United States Constitution. Thus, the circuit court violated Belue's constitutional rights when it held the motion hearing in his absence and received testimony from his trial attorney contradicting the factual allegations he had made in support of his claim that he had had inadequate trial counsel.
The issue in this case is different from that presented in Ex parte DeBruce, 651 So. 2d 624 (Ala.1994). In that case, this Court held that a criminal defendant's rights were not violated when he was not allowed to be present at hearings on pretrial motions. However, unlike the present case, DeBruce did not involve a defendant's right to be present at a hearing in which his former attorney gives testimony refuting the defendant's factual allegations made in support of a claim of ineffective assistance by the former counsel. A defendant has that right, so that he may assist his new counsel and may confront his former attorney as that attorney gives testimony adverse to the defendant's claims of inadequate counsel.
"At a hearing on a motion for new trial, the defendant has the burden of proving the allegations of his motion to the satisfaction of the trial court." Miles v. State, 624 So. 2d 700, 703 (Ala.Crim.App.1993) (citing Anderson v. State, 46 Ala.App. 546, 547, 245 So. 2d 832, 833 (1971), and Jones v. State, 31 Ala.App. 504, 507, 19 So. 2d 81, 84 (1944)). In circumstances such as those presented in this case, the defendant may be the only witness with the special knowledge of the facts necessary to dispute the evidence offered by the State that is contrary to his assertions and to testify in the defendant's behalf. Therefore, Belue had a constitutional right to be present at the hearing, and the denial of that right was reversible error.
The judgment of the Court of Criminal Appeals is reversed. The cause is remanded for that court to direct the circuit court to vacate its order denying the motion for a new trial and to conduct a second hearing with the defendant present.
REVERSED AND REMANDED.
SHORES, HOUSTON, KENNEDY, COOK, and LYONS, JJ., concur.
MADDOX, J., concurs in the result.
HOOPER, C.J., and SEE, J., dissent. | bf92aab68656572dd4b0efdd07fe1eba050e80282afd2243d975c1f364634791 | 1998-09-11 00:00:00 |
e9fa510f-3344-48cf-9454-2af46264ec7d | Ex Parte Woodall | 730 So. 2d 652 | 1961958 | Alabama | Alabama Supreme Court | 730 So. 2d 652 (1998)
Ex parte J.C. WOODALL.
(Re J.C. Woodall v. State).
1961958.
Supreme Court of Alabama.
September 11, 1998.
Rehearing Denied November 20, 1998.
*655 Michael H. McDuffie, Montgomery, for petitioner.
Bill Pryor, atty. gen., and Michelle Riley Stephens, asst. atty. gen., for respondent.
SHORES, Justice.
A jury convicted the defendant J.C. Woodall of murder done for a pecuniary or other valuable consideration or pursuant to a contract or for hire, an offense made capital by § 13A-5-40(a)(7), Ala.Code 1975, and of attempted murder, §§ 13A-6-2 and 13A-4-2, Ala.Code 1975. The jury recommended the death sentence on the capital count by a 10-2 vote; the trial court followed that recommendation and sentenced the defendant to death by electrocution. On the attempted murder count, the trial court sentenced the defendant to a life term in the penitentiary. The Court of Criminal Appeals affirmed both convictions and the sentence of death, Woodall v. State, 730 So. 2d 627 (Ala.Cr.App.1997). We granted certiorari review, see Rule 39(c), Ala. R.App. P.; we now affirm the defendant's conviction and his sentence of life imprisonment on the count of attempted murder, but we reverse the judgment of the Court of Criminal Appeals affirming his conviction and his sentence of death on the murder-for-hire count, and we remand the case.
The facts of this case are stated in the opinion of the Court of Criminal Appeals. However, because we will address questions regarding the sufficiency of the evidence that were not presented to that court, we believe a statement of the facts would assist the reader.
Although he had lived in Kansas for many years, the defendant had been involved in a long-standing dispute with family members over certain real property located near Tallassee in Elmore County, Alabama. The defendant's strongest feelings of anger and resentment were directed toward his youngest *656 brother, Elmer "Stormy" Woodall, who had acquired the property and lived on it. The State's evidence tended to show that in March or April 1989 the defendant approached a longtime acquaintance, John Kennon, and inquired whether Kennon would be interested in going to Alabama to kill someone there who had caused the defendant some problems over land and money. Kennon declined, but told the defendant he knew someone who might perform such a task. Kennon introduced the defendant to Freddie Glenn Pope, who told the defendant he knew someone who would do the killing for $3,500, although Pope intended to carry out the killing himself. Pope testified that the defendant agreed to the price and later provided Pope with a picture that included Elmer Woodall, to indicate the target of the "hit," and a map showing the area near Tallassee where Elmer Woodall resided.
Pope arrived in Alabama on Sunday, June 25, 1989, after driving from Kansas, and he proceeded to Elmer Woodall's property, intending to kill him. No one was home at that time, but Pope noticed a new automobile in the carport at the house; this concerned him, because the defendant had told him that Elmer Woodall lived alone. Pope returned to Elmer Woodall's house early the following morning, Monday, June 26, but found that the intended victim and several others were working on the roof of the house, and Pope also observed from a distance a woman near a pond behind the house. Pope approached Elmer Woodall and told him he was a contractor from Mississippi and was interested in purchasing a large quantity of gravel, and he also showed Elmer Woodall the map the defendant had given him to locate the property. Elmer Woodall immediately recognized the map as one that he had colored on with a yellow marker to indicate certain plots of the family real estate and then had mailed to the defendant in September 1988 in connection with settlement negotiations regarding litigation over the land. Pope testified that he left the property and telephoned the defendant from a pay telephone at a service station/convenience store in Montgomery. Pope said he questioned the defendant about the new automobile in the carport and the defendant told him that it probably belonged to his sister from Florida. Pope said he then told the defendant that he was concerned that the plan could not work because "that woman can't be around there," to which he said the defendant responded, "[I]f she gets in the road, she has got to go." Telephone records introduced at trial confirmed that on the morning of June 26, 1989, a two-minute call was placed from the Montgomery service station pay telephone to the defendant's home telephone in Kansas.
After waiting several hours, Pope returned to the house, where he noticed an elderly woman in the yard. That woman, who also resided at the house, was 81-year-old Clemer Woodall, the mother of both the defendant and Elmer Woodall. Pope approached Elmer Woodall and requested to use his telephone. As Elmer Woodall led him toward the telephone on the back porch, Pope pulled a pistol and said that "this is nothing about no telephone conversation ...; this is a robbery." Pope attempted to force Elmer into the house, to prevent anyone from hearing gunshots, but Elmer began walking out toward the yard; Pope shot him in the head. Clemer Woodall, having witnessed the shooting of her youngest child, began screaming. Pope told her to shut up, but when she screamed again he shot her in the head, killing her. Pope then realized that Elmer was still making noises, so he shot him in the head again. Pope drove away, believing that both Elmer and Clemer Woodall were dead. Remarkably, however, Elmer Woodall survived and was able to provide information that allowed police to identify and arrest Pope. Pope confessed to the crimes, implicating the defendant and Kennon.
On July 14, 1989, an Elmore County grand jury returned a four-count indictment against J.C. Woodall, charging him with two counts of capital murder, under §§ 13A-5-40(a)(2) and (a)(7), Ala.Code 1975 (robbery-murder and murder-for-hire), in connection with the death of his mother, Clemer Woodall; and one count each of the noncapital offenses of attempted murder, §§ 13A-6-2, 13A-4-2, Ala.Code 1975, and assault in the first degree, § 13A-6-20, Ala.Code 1975, in connection with the shooting of his brother, Elmer Woodall. The defendant was arrested in *657 Kansas, and Alabama authorities sought his return in order to have him stand trial. After protracted extradition challenges in the state and federal courts in Kansas, see Kennon v. State, 248 Kan. 515, 809 P.2d 546 (1991); Kennon v. Hill, 44 F.3d 904 (10th Cir.), cert. den., 515 U.S. 1146, 115 S. Ct. 2586, 132 L. Ed. 2d 835 (1995), J.C. Woodall was delivered to Alabama authorities. In December 1995, after a trial in the Elmore County Circuit Court, he was convicted of capital murder on the count based upon § 13A-5-40(a)(7) and was convicted of attempted murder.
In his brief, the defendant presents over 25 issues for review. However, we find it necessary to address only three issues: (I) Whether the evidence was sufficient to sustain the defendant's conviction on the capital murder count, (II) whether there was sufficient evidence to corroborate the accomplice testimony to sustain his conviction on the capital murder count, and (III) whether the state's cross-examination of the defendant regarding his character and the subsequent introduction of evidence of three incidents involving uncharged misconduct require reversal of the capital murder conviction. The opinion of the Court of Criminal Appeals did not address any of these three issues; apparently they were not presented to that court. However, because this is a case in which the death penalty has been imposed, our review allows us to address any plain error or defect found in the proceeding under review, even if the error was not brought to the attention of the trial court. Rules 39(k) and 45A, Ala. R.App. P.[1] "`"Plain error"' arises only if the error is so obvious that the failure to notice it would seriously affect the fairness or integrity of the judicial proceedings.'" Ex parte Womack, 435 So. 2d 766, 769 (Ala.), cert. denied, 464 U.S. 986, 104 S. Ct. 436, 78 L. Ed. 2d 367 (1983). "`In other words, the plain-error exception to the contemporaneous objection rule is to be "used sparingly, solely in those circumstances in which a miscarriage of justice would otherwise result."`" Ex parte Land, 678 So. 2d 224, 232 (Ala.1996), quoting United States v. Young, 470 U.S. 1, 105 S. Ct. 1038, 84 L. Ed. 2d 1 (1985), quoting United States v. Frady, 456 U.S. 152, 163, n. 14, 102 S. Ct. 1584, 71 L. Ed. 2d 816 (1982). This Court may take appropriate action, however, when the error "has or probably has adversely affected the substantial rights of the petitioner." Rules 39(k) and 45A, Ala. R.App. P. We note that a failure to object at trial, while not precluding our review, will weigh against any claim of prejudice. Kuenzel v. State, 577 So. 2d 474 (Ala.Cr.App.1990), aff'd, 577 So. 2d 531 (Ala.), cert. denied, 502 U.S. 886, 112 S. Ct. 242, 116 L. Ed. 2d 197 (1991).
The defendant contends that his capital murder conviction and death sentence must be reversed because, he claims, the evidence was insufficient to support his conviction of the capital murder-for-hire of Clemer Woodall, as charged in the indictment. More specifically, the defendant argues that, even if there was sufficient evidence to indicate that he procured Pope to kill Elmer Woodall, there was insufficient proof indicating that he specifically intended that Pope kill Clemer Woodall, his mother.
No defendant can be found guilty of a capital offense unless he had an intent to kill, and that intent to kill cannot be supplied by the felony-murder doctrine. Beck v. State, 396 So. 2d 645, 662 (Ala.1981); see also Enmund v. Florida, 458 U.S. 782, 797, 102 S. Ct. 3368, 73 L. Ed. 2d 1140 (1982) (holding that imposing the death penalty upon the driver of a getaway car who did not "himself kill, attempt to kill, or intend that a killing take place or that lethal force will be employed" *658 constitutes cruel and unusual punishment). However, this Court has written:
Ex parte Raines, 429 So. 2d 1111, 1112 (Ala. 1982). Thus, one who hires another to commit a murder may be convicted of the capital offense delineated by § 13A-5-40(a)(7), Ala. Code 1975, under the doctrine of accomplice liability. See Haney v. State, 603 So. 2d 368, 380 (Ala.Cr.App.1991), aff'd, 603 So. 2d 412 (Ala.1992), cert. denied, 507 U.S. 925, 113 S. Ct. 1297, 122 L. Ed. 2d 687 (1993); see also § 13A-2-23, Ala.Code 1975. "The accomplice... is criminally responsible for acts which are the direct, proximate, natural result of the conspiracy formed," but "[he] is not responsible for any special act, not within the scope of the common purpose, but grow[ing] out of the individual malice of the perpetrator. 1 Wharton Crim.Law, § 397." Keller v. State, 380 So. 2d 926, 935 (Ala.Cr. App.1979), cert. denied, 380 So. 2d 938 (Ala. 1980).
The capital offense of which this defendant was convicted, see § 13A-5-40(a)(7), Ala.Code 1975, requires (1) proof of an intentional murder and (2) proof that the murder was committed for pecuniary gain, or pursuant to a contract, or for hire. Sockwell v. State, 675 So. 2d 4, 24 (Ala.Cr.App.1993). We agree with the defendant that his intent that Pope kill Elmer Woodall pursuant to a contract could not supply the intent necessary to convict the defendant for the capital murder-for-hire of Clemer Woodall. Cf. Tomlin v. State, 591 So. 2d 550 (Ala.Cr.App.1991) (holding that under the accomplice liability doctrine, a nontriggerman accomplice may be convicted of double murder, a capital offense under § 13A-5-40(a)(10), Ala.Code 1975, only if he had the particularized intent that both victims be killed). Rather, in order to convict the defendant of the capital offense charged, the State had to prove, beyond a reasonable doubt, that the defendant intended that Clemer Woodall be killed and that she was killed "for a pecuniary or other valuable consideration or pursuant to a contract or for hire." Sockwell, supra.
"In determining the sufficiency of the evidence to sustain a conviction, a reviewing court must accept as true all evidence introduced by the State, accord the State all legitimate inferences therefrom, and consider all evidence in a light most favorable to the prosecution. Faircloth v. State, 471 So. 2d 485 (Ala.Cr.App.1984), aff'd, 471 So. 2d 493 (Ala.1985)." Powe v. State, 597 So. 2d 721, 724 (Ala.1991). It is not the function of this Court to decide whether the evidence is believable beyond a reasonable doubt, Pennington v. State, 421 So. 2d 1361 (Ala.Cr.App. 1982); rather, the function of this Court is to determine whether there is legal evidence from which a rational finder of fact could have, by fair inference, found the defendant guilty beyond a reasonable doubt. Davis v. State, 598 So. 2d 1054 (Ala.Cr.App.1992). Thus, "[t]he role of appellate courts is not to say what the facts are. [Their role] is to judge whether the evidence is legally sufficient to allow submission of an issue for decision [by] the jury." Ex parte Bankston, 358 So. 2d 1040, 1042 (Ala.1978) (emphasis original).
The evidence tended to show that the defendant hired Pope expressly to kill the defendant's brother, Elmer Woodall. The evidence further indicated that, although he told Pope that Elmer Woodall lived alone, the defendant was aware that his mother, Clemer Woodall, resided at the house with Elmer Woodall. Pope testified that once he was in Alabama, but before committing the shootings, he telephoned the defendant in Kansas and that the defendant told him that the other person at the house was probably his sister from Florida and that "if she gets in the road she has got to go." Pope said he understood this to mean that whoever was present when the murder took place would have to be killed so that there would be no *659 witnesses. The defendant argues that Pope's testimony on this issue is not believable, but our function is only to assess whether the evidence is legally sufficient to sustain the defendant's capital murder conviction, not to second-guess the jury's assessment of the credibility of the testimony. We conclude that there was sufficient evidence to allow the jury to infer that the defendant hired Pope and intended that Pope, if doing so was necessary to complete his primary task of killing Elmer Woodall, should also kill Clemer Woodall or anyone else present who might be a potential witness to the crime. The defendant's claim on this ground is due to be denied.
The defendant argues that his capital conviction and death sentence must be reversed because, he claims, the State failed to present sufficient evidence to corroborate the testimony of his accomplices, Freddie Glenn Pope and John Kennon. He did not raise this claim below; therefore, we review it only for the purpose of determining whether "plain error" occurred. See Rule 39(k), Ala. R.App. P.
Section 12-21-222, Ala.Code 1975, provides:
The Court of Criminal Appeals, explaining this statute, has written:
Banks v. State, 647 So. 2d 46, 49 (Ala.Cr.App. 1994) (citation omitted).
In the instant case, there was the following corroborative evidence: The prosecution introduced undisputed evidence that the defendant and members of his family had been involved in a long-standing legal dispute over the property in Elmore County where Elmer and Clemer Woodall resided.[2] Elmer Woodall testified that Pope arrived at his property in an automobile bearing license plates from Kansas, the state where the defendant resided. Elmer Woodall further stated that Pope had with him a map of the property with distinctive markings upon it that allowed Elmer Woodall to identify the map as one he had sent to the defendant several months earlier in connection with settlement negotiations regarding the family property. And finally, Mark Finnegan, the son of the defendant's girlfriend, testified that, after the defendant had returned to Kansas after attending his mother's funeral and having been questioned by Alabama investigators, *660 the defendant and he were driving around together when the defendant stated to him, "I think they got me this time, Mark." We conclude that there was sufficient evidence to corroborate the testimony of the accomplices, Pope and Kennon.
The defendant argues that when he took the stand on his own behalf the State improperly impeached his testimony and attempted to show that he had a propensity for violence, by initiating, on cross-examination, an inquiry into his character and then presenting evidence of specific prior bad acts. The defendant did not properly preserve this alleged error in the trial court and did not argue it in the Court of Criminal Appeals. Thus, we review this alleged error only for "plain error." See Rule 39(k), Ala. R.App. P.
On cross-examination, the prosecutor asked the defendant, "You are not a violent person, are you?" The defendant answered that he was not. The prosecutor also asked the defendant whether he had ever been the person to "hit first" in a fight. The defendant denied being able to recall any time when he had been. The State responded by introducing evidence of an altercation between the defendant and a coworker that occurred in 1980, when the defendant was employed by the Boeing Military Airplane Company ("Boeing"). Boeing reports admitted into evidence stated that an internal investigation revealed that the defendant had hit a coworker in the head with his fist after the other man had called the defendant a "son of a bitch" because the defendant would not allow him to use a certain vehicle. A scuffle ensued and the men were separated. As a result of the incident, the defendant was dismissed from Boeing for violating a company rule against fighting.
The prosecutor then elicited evidence of another physical confrontation regarding the defendant, this time with an inmate during the time the defendant was in jail awaiting trial on the present charges. The prosecutor asked, "Do you always back up from contact with people, physical contact?" The defendant responded, "Just a good idea to back up." The prosecutor then asked the defendant whether he had "ever been into any confrontation with anybody while you have been in jail" and whether he had "had occasion to push [an inmate] into a wall." The defendant conceded that he had, because, he said, he believed the inmate had been talking about his case.
Finally, the prosecutor questioned the defendant about whether he had ever assaulted a child with a baseball bat. The defendant denied that he had ever done that. On rebuttal, the State called Mark Woodall, the defendant's 33-year-old estranged son, who testified as follows on direct examination by the prosecutor:
(R.T. 1555-56.)
During closing argument, the prosecutor referred to this beating incident. The trial court subsequently instructed the jury that it was to consider evidence of the defendant's violent past acts only for purposes of impeachment and that it could not use that evidence to draw any conclusions regarding his character.
In its brief, the State attempts to justify the admission of this evidence showing the defendant's specific prior violent conduct, by emphasizing that the defendant testified on cross-examination that he was not violent and that he sought to avoid physical confrontations. These broad assertions, the State contends, opened the door to questions regarding his character and permitted evidence of the prior bad acts as impeachment. We disagree.
"Good or bad character of the accused is never an issue upon which the state may offer evidence to prove guilt unless the accused has first chosen to make it an issue." C. Gamble, McElroy's Alabama Evidence, § 27.02(1) (5th ed.1996) (footnote omitted). "[T]he state cannot initiate the proving of the defendant's bad character to prove his guilt. `In a criminal prosecution, it is generally agreed that the state is not allowed to introduce evidence of the accused's bad character until the accused has first entered evidence of his good character.'" Dockery v. State, 659 So. 2d 219, 220-21 (Ala.Cr.App.1994) (citation omitted). See also Ala. R. Evid. 404.[3]
The State's argument in this case is identical to one rejected by the Court of Appeals of Georgia in a case with similar facts. In Arnold v. State, 193 Ga.App. 206, 387 S.E.2d 417 (1989), the prosecutor had on cross-examination asked the defendant three times whether he was a violent person. After the defendant responded by denying that he was violent, the prosecutor asked the defendant whether he had been convicted of aggravated assault. The defendant responded, "Yes[, but] that happened when I was young." 193 Ga.App. at 207, 387 S.E.2d at 418. On appeal, the defendant claimed that the prosecutor had improperly impeached his testimony and had attempted to show bad character. The prosecutor countered by contending that the questioning of the defendant regarding his prior conviction was permissible on the basis that the defendant had put his character in issue through his answers, given on cross-examination, indicating that he was not violent. The Court of Appeals rejected that argument and reversed the defendant's conviction, stating:
193 Ga.App. at 207-08, 387 S.E.2d at 419-20 (emphasis original).
We conclude that the reasoning of the Arnold court is persuasive here. The justification *662 the State offered in this present case for the admission of the evidence of the defendant's prior uncharged violent conduct, i.e., that his answers on cross-examination indicating that he was not violent opened the door to questions regarding his character, is due to be rejected. It may not be said that the defendant chose to put his character at issue merely by responding to the prosecutor's cross-examination designed to elicit testimony on that subject. Cf. Wilson v. Gray, 505 So. 2d 385 (Ala.1987) (wherein this Court noted its agreement with the trial court's determination that a civil defendant could not be impeached regarding his affirmative response to the question asked on cross-examination, whether the defendant considered himself to be a "responsible contractor," because the question asked by the plaintiffs counsel was an improper inquiry into the defendant's character).
Nor can we conclude that the defendant voluntarily chose to place his character in issue by virtue of his testimony on direct examination and thereby justified the prosecutor's line of cross-examination into his propensity for violence and specific acts indicating that propensity.[4] Although the State does not advance this argument in its brief, it might be claimed that the defendant had done so by giving direct testimony in which he indicated that he "would" not "under any circumstances" "ever" have hired someone to kill his mother or have told Pope that it was "okay" to kill her. However, we do not believe that such ambiguous statements, which appear to have been made in the context of attempting to show that the defendant had a close and loving relationship with his mother, and, hence, no motive to kill her, can be fairly construed as an unequivocal assertion of good character that would justify cross-examination about prior violence against others generally. Compare United States v. Collier, 29 M.J. 365 (C.M.A.1990) (holding that a defendant's answer on direct examination that he "would have at eased" if ordered to do so by a particular superior officer was not an unequivocal assertion that he possessed the character trait of obedience to orders, because the defendant's answer could be explained by showing a special relationship to that superior officer), with State v. Guritz, 134 Or.App. 262, 894 P.2d 1235 (1995) (upholding trial court's allowing state's cross-examination of defendant charged with sodomizing his five-year-old daughter, regarding his having been cited for purchasing *663 marijuana during a trip to the park with the victim, based upon the fact that the evidence of such misconduct directly contradicted defendant's extended testimony on direct examination detailing how he was a good father with a close relationship to the victim).
Furthermore, even if the defendant had chosen to place his character in issue, by presenting evidence that it was good, the state generally would not be permitted to present evidence showing that he was in fact guilty of committing prior specific uncharged bad acts:
"Id. at § 26.01(1) (footnotes omitted).
Snyder v. State, 644 So. 2d 1289, 1293 (Ala.Cr. App.1994). Accordingly, the trial court erred in allowing the State to present evidence to prove that the defendant had in fact committed the three prior uncharged violent acts; that evidence was improper impeachment and tended to suggest that the defendant was predisposed toward violence and thus was more likely to have committed the crimes charged. The question still remains, however, whether the admission of the evidence showing the defendant's commission of the three violent acts rises to the level of "plain error" requiring reversal of the defendant's capital conviction and death sentence.
In Ex parte Johnson, 507 So. 2d 1351 (Ala. 1986), this Court held it plain error to admit *664 into evidence a fingerprint record card of a capital defendant, containing a list of dates and prior arrests of the defendant for other offenses. After implicitly recognizing that "`[p]rior arrests of the accused on other charges which have no relevancy except as tending to show his bad character are not admissible,'" 507 So. 2d at 1353 (citation omitted), we stated:
Id. at 1356-57.
The Court of Criminal Appeals has, similarly, reversed a conviction under the plain error standard on the grounds that the trial court improperly admitted evidence of the defendant's bad character. In Tabb v. State, 553 So. 2d 628 (Ala.Cr.App.1989), the defendant had been found guilty of the capital offense of murder during a rape in the first degree. At trial, a police investigator testified that the defendant had told him that he was in Alabama "because he was a drug addict and to get off cocaine." 553 So. 2d at 630. The Court of Criminal Appeals stated, "We can find no purpose in the elicitation of this testimony, other than to show the bad character of the appellant," id., specifically noting, however, that the defendant did not testify at trial, id. at n. 1. The prosecutor, in closing argument, again mentioned the investigator's testimony that the defendant was "trying to get off cocaine." Id. The Court of Criminal Appeals concluded that the defendant's substantial rights had been affected, reasoning that his defense was based largely upon a claim of truthfulness, and that the State's introduction of improper testimony directly undermined his defense theory by suggesting that, because he was a drug addict, he was of bad character and lacked credibility. Id. at 631.
We conclude that the error in this present case is comparable to the errors in Johnson and Tabb, supra, and that it rises to the level of plain error. The state introduced evidence indicating that the defendant had been involved in three separate incidents, strongly implying a pattern of violent behavior. Especially troubling is the admission of direct testimony from Mark Woodall stating that, 20 years before trial and 13 years before the commission of the charged offenses, and while Mark Woodall was a child, the defendant had severely beaten him with a baseball bat, necessitating a trip to the emergency room. We believe that this testimony, which was again referred to by the prosecutor in closing arguments, "would have had an almost irreversible impact upon the minds of the jurors." Johnson, supra, 507 So. 2d at 1357. Furthermore, the defendant's defense was based almost entirely upon the jury's finding his trial testimony asserting his innocence to be more credible than the accusations leveled by Pope and Kennon. Thus, the trial court, by allowing improper impeachment of the defendant's testimony, substantially undercut his defense, and his substantial rights were probably adversely affected. We hold that this plain error requires the reversal of the defendant's murder-for-hire capital conviction and his sentence of death. Accordingly, the case must be remanded on that ground.
However, in addition to being convicted of the capital murder-for-hire of Clemer Woodall, the defendant was also convicted of the attempted murder of Elmer Woodall, for which the defendant received a sentence of life imprisonment. Still remaining, therefore, is the question of what action, if any, this Court should take with respect to this latter conviction, given our conclusion that plain error occurred at the defendant's trial. Under Rule 39(k), Ala. R.App. P., this Court is required to review the record for plain error "[i]n all cases in which the death penalty has been imposed." This plain error review operates as a "safeguard to insure *665 that the death sentence is not being imposed arbitrarily or capriciously." Beck v. Alabama, 396 So. 2d 645, 664 (Ala.1981). As the United States Supreme Court stated in Woodson v. North Carolina, 428 U.S. 280, 305, 96 S. Ct. 2978, 49 L. Ed. 2d 944 (1976):
Quoted in Knight v. State, 675 So. 2d 487, 496 (Ala.Cr.App.1995).
Because the defendant in this case was sentenced to death, we have complied with our obligation under Rule 39(k) and conducted a plain-error review. However, with respect to his attempted murder conviction, for which he received a sentence of less than death, we do not believe the defendant is entitled to benefit from our plain error review. We have found no Alabama decision dealing with the particular situation present here: a case in which plain error necessitated a reversal on a capital conviction and death sentence but in which the defendant was also sentenced to a term of imprisonment on another conviction. However, the defendant's sentence of imprisonment for his conviction of attempted murder does not implicate the same heightened degree of concern for reliability that attended his sentence of death for the capital conviction. It is well established that where a defendant receives only a prison sentence the plain-error doctrine is not applicable and an appellate court will not consider an alleged error that the defendant failed to preserve by making a proper and timely objection in the trial court. See Biddie v. State, 516 So. 2d 846 (Ala.1987); Harris v. State, 347 So. 2d 1363 (Ala.Cr.App. 1977), cert. denied, 347 So. 2d 1368 (Ala.1978). Indeed, it has been said that the plain-error doctrine "applies to death penalty cases, but not to other convictions." Pugh v. State, 355 So. 2d 386, 389 (Ala.Cr.App.), cert. denied, 355 So. 2d 392 (Ala.1977) (citations omitted) (emphasis added).
Had the defendant been convicted and sentenced to a term of imprisonment on the attempted murder count but either acquitted or sentenced to life imprisonment without the possibility of parole on the capital murder count, the plain-error doctrine would not have applied. Thus, we would not have even considered the error upon which we have predicated our reversal of his capital conviction and death sentence: the State's questioning of the defendant regarding his character and the subsequent introduction of evidence of specific incidents tending to indicate a propensity for violence. No objection to that questioning was raised at trial. The defendant should not be put in a more favorable position with respect to our review of his noncapital conviction simply because he was also found guilty of a capital offense and was sentenced to death. Thus, we conclude that the defendant's failure to object to the State's inquiry into his character or to the introduction of evidence of the three violent incidents precludes this Court from considering those grounds as the foundation for a reversal of his attempted-murder conviction, for which he received a sentence of less than death.
The defendant raises a number of other issues in his brief. Many of these pertain to the propriety of the sentencing phase of the trial or of the infliction of the death penalty itself; given our reversal of the defendant's capital conviction and death sentence, we need not address these claims at this time. Of the defendant's remaining claims, we conclude that they were adequately addressed by the Court of Criminal Appeals in its opinion or that, with respect to the defendant's noncapital conviction, they were not properly preserved for our review.
We have determined that, on the capital murder-for-hire count, the evidence was sufficient to establish guilt and that the accomplice testimony was sufficiently corroborated. However, we conclude that it was plain error to allow the State to question the defendant regarding his character and to admit evidence indicating that the defendant had been guilty of uncharged prior violent conduct on *666 three separate occasions. This evidence was not admissible to impeach the defendant's testimony, nor to prove his bad character. We also conclude that this plain error probably adversely affected the substantial rights of the defendant; his capital murder conviction and death sentence are, therefore, reversed and the case is remanded for further proceedings. However, because the defendant failed to object to this plain error at trial, we hold that it cannot form the basis for a reversal of his attempted-murder conviction, for which he received a sentence of life imprisonment. Because we find no properly preserved error warranting reversal of that noncapital conviction, it is hereby affirmed, as is the sentence for that conviction.
NONCAPITAL CONVICTION AND SENTENCE AFFIRMED; CAPITAL CONVICTION AND SENTENCE REVERSED; REMANDED FOR FURTHER PROCEEDINGS ON THE § 13A-5-40(a)(7) CAPITAL CHARGE.
HOOPER, C.J., and MADDOX, ALMON, HOUSTON, COOK, SEE, and LYONS, JJ., concur.
[1] Although we reverse the defendant's capital murder conviction and remand for a new trial on that count, based upon the state's questioning, and its introduction of evidence, regarding the defendant's character, we deem it appropriate to address, under our plain error review, his contentions that the evidence was insufficient to establish his guilt or to corroborate the accomplice testimony on the capital murder count. This is because the Double Jeopardy Clause of the Fifth Amendment to the United States Constitution would bar a retrial if the defendant is correct in arguing that the evidence was either insufficient to establish guilt, see Ex parte Roberts, 662 So. 2d 229 (Ala.1995), or insufficient to corroborate the accomplice testimony, see McCoy v. State, 397 So. 2d 577 (Ala.Cr.App.), cert. denied, 397 So. 2d 589 (Ala.1981).
[2] Proof of motive alone is not generally enough to satisfy the corroboration requirement of § 12-21-222. McCoy v. State, 397 So. 2d 577, 587 (Ala.Cr.App.1981). However, evidence of motive is legitimate evidence that may be used to corroborate an accomplice's testimony. Thompson v. State, 374 So. 2d 388 (Ala.1979).
[3] We note that the trial in this case began before January 1, 1996; therefore, the Alabama Rules of Evidence do not apply. Rule 1103, Ala. R. Evid.; see Norfolk Southern R.R. v. Thompson, 679 So. 2d 689, 693 n. 1 (Ala.1996).
[4] It is well established that an accused who voluntarily takes the stand is generally subject to impeachment, as is any other witness, Ex parte Pippens, 621 So. 2d 961 (Ala.1993). Thus, in order to test the veracity of a testifying defendant, the prosecution generally could, under the evidentiary rules applicable at the time of the defendant's trial, cross-examine a defendant about his prior convictions for crimes involving moral turpitude, see § 12-21-162, Ala.Code; Ex parte Bankhead, 585 So. 2d 112, 122 (Ala.1991), but not about uncharged misconduct, see Ex parte Jefferson, 473 So. 2d 1110, 1115 (Ala.1985). Further, a defense witness who testifies to the good character of the accused may be also questioned about having heard about relevant specific instances of misconduct by the accused that would be inconsistent with the good character asserted on direct examination, not to prove the accused's bad character but rather to test the foundation and knowledge of the witness's character testimony. See, e.g., Jarrell v. State, 251 Ala. 50, 36 So. 2d 336 (1948); Breeding v. State, 523 So. 2d 496, 502 (Ala.Cr.App.1987); Smith v. State, 446 So. 2d 68, 73 (Ala.Cr.App.1984); see also C. Gamble, McElroy's Alabama Evidence § 27.01(5), (6) (5th ed.1996). Thus, it has been recognized that should an accused be permitted to testify to his own good character, then the prosecution could similarly ask on cross-examination about relevant prior instances of inconsistent misconduct. See C. Gamble, McElroy's Alabama Evidence § 26.02(9) (5th ed.1996). However, even if a character witness denies on cross-examination having heard of or being aware of the inquired-about specific misconduct of the subject person, the cross-examining party still may not prove that the subject person is actually guilty of the misconduct, even to impeach the witness. Hussey v. State, 87 Ala. 121, 6 So. 420 (1889); see also Abston v. State, 548 So. 2d 624, 627 (Ala.Cr.App.1989) (holding that the objective truth or falsity of reports concerning a witness were not subject to further proof because such truth or falsity was a collateral matter). In any event, because we conclude that this defendant did not, through his direct examination testimony, assert that he was of a good character, the State was not permitted to cross-examine him regarding his alleged violent confrontations with others that did not result in criminal convictions, even if one assumes that other witnesses who attested to the defendant's nonviolent nature might have been questioned about having heard of such violent incidents. See Walker v. State, 205 Ala. 197, 200, 87 So. 833, 836 (1921). | 032eea8413d73903b41c5b5c4d7d639818d73cebfe152081e362a6325bb0485c | 1998-09-11 00:00:00 |
165b1192-63ca-479f-b381-2e6773b7823d | Ex Parte Carstens | 728 So. 2d 128 | 1970793 | Alabama | Alabama Supreme Court | 728 So. 2d 128 (1998)
Ex parte Robert Dale CARSTENS.
(Re Marianne Davidson v. Robert Dale Carstens).
1970793.
Supreme Court of Alabama.
August 7, 1998.
Opinion Overruling Rehearing November 6, 1998.
*129 James C. Alison, Huntsville, for petitioner.
Amy A. Slayden, Huntsville, for respondent.
MADDOX, Justice.
Robert Dale Carstens petitions for a writ of mandamus directing the Madison Circuit Court to dismiss an action pending in that court. The petition presents the question whether the Madison Circuit Court has jurisdiction to act on a petition for modification of the child support provisions of a judgment issued by that court in 1985, where neither the parents nor the child still lives in this State. For the reasons discussed below, we hold that it does have jurisdiction, and we therefore deny the petition.
Robert Dale Carstens and Marianne Davidson are the parents of a child born on April 7, 1980. The parents were not married at the time of the child's birth. The Circuit Court of Pinellas County, Florida, entered a final order concerning the custody rights and child support obligations of the parents on July 28, 1982. (Because the parents had not been married, this order was not, also, a divorce judgment.) That order granted the parents shared custody, but it made the mother's home the child's primary residence. The father was granted specified visitation rights. He was also required to pay $175 per month in child support, $50 per month in day care costs, and the costs for the child to attend college, until the age of 25. In its order, the court retained jurisdiction over the action for the purpose of resolving future disputes between the parents.
Within approximately a year of the entry of the Florida court's order, the mother and the child moved to Huntsville, Alabama. The father has apparently lived in Nebraska continuously since before the child's birth. He has never lived in Alabama.
On October 14, 1983, the mother filed a petition, case number DR-83-1661, in the Madison Circuit Court, under the provisions of the Uniform Child Custody Jurisdiction Act, § 30-3-20 et seq., Ala.Code 1975, for a modification of the child custody provisions of the Florida order. On March 27, 1984, upon the mother's motion, the Circuit Court of Pinellas County, Florida, entered an order declaring that it was an inconvenient forum, thereby terminating its own jurisdiction.[1]
On August 15, 1984, the father counterclaimed in the Madison County action, seeking a change in custody. On March 20, 1985, the father filed in the Madison Circuit Court a separate action, case number CV-85-323, seeking to have that court enforce a judgment for attorney fees of approximately $5,000 against the mother that the father claims had been entered by the Florida court before that court terminated its jurisdiction in 1984. On May 27, 1985, the Madison Circuit Court consolidated the two cases.
On October 18, 1985, the Madison Circuit Court entered an order incorporating the terms of an agreement the parties had entered. That order read, in part:
At some point following the entry of that 1985 order, the mother and the child returned to Florida. It is unclear from the materials before this Court precisely when the mother and the child moved out of Alabama. On April 22, 1997, the mother filed, in the Madison Circuit Court, a petition to modify the support provisions of the 1985 order. At that time both she and the child were residents of the State of Florida.
In her 1997 petition, the mother requested that the court order the father to pay, among other costs, "college expenses" and one half of the child's medical expenses not covered by insurance. The father filed a motion to dismiss, contending: (1) that the Madison Circuit Court lacked personal jurisdiction because, he claimed, he did not have contacts with the State of Alabama sufficient to establish personal jurisdiction; and (2) that the court lacked subject-matter jurisdiction because, he claimed, the 1985 order was issued under the Uniform Child Custody Jurisdiction Act, under which, he argues, an order compelling payment of support is not appropriate; and because the mother and the child had moved from Alabama. The trial court denied that motion, by an order that stated, in part:
The trial court subsequently denied the father's motion to "reconsider" its denial of the motion to dismiss. The father petitioned the Court of Civil Appeals for a writ of mandamus directing the Madison Circuit Court to dismiss the action. The Court of Civil Appeals denied his petition. Ex parte Carstens, (No. 2970428) ___ So.2d ___ (Ala.Civ.App. 1998) (table). The father now asks this Court to direct the circuit court to dismiss the action.
In his petition for the writ of mandamus, the father makes the following arguments:
We will address each of the father's arguments, in turn.
We first consider whether the Madison Circuit Court has personal jurisdiction over the father in this matter. That question is easily resolved. In the written, signed agreement between the father and the mother that the circuit court incorporated into its October 18, 1985, order, the parties stated:
In its subsequent order, "[t]he [Circuit] Court [determined] that [it had] jurisdiction over the parties to this action, the defendant having waived in writing any defects in jurisdiction *132 over his person." Further, the court expressly retained jurisdiction over this matter for the purpose of resolving future disputes growing out of its order.
One could scarcely ask for a clearer waiver of a claim that a court lacks in personam jurisdiction than is embodied in the written agreement of the parties. As a consequence, we hold that the circuit court correctly determined in its 1985 order that it had in personam jurisdiction over the father. Further, although a 10-year period has passed, we hold, because the trial court expressly retained jurisdiction and because of the continuing nature of orders in divorce, custody, and support cases,[2] that when the mother filed her motion for a modification of the support order, the trial court still had in personam jurisdiction over the father. Accordingly, we reject the father's first argument.
We now consider the question whether the trial court has subject-matter jurisdiction. In July 1982, the Circuit Court of Pinellas County, Florida, entered a final order settling questions of custody and support. In its order, the Florida court expressly retained jurisdiction over the parties and the subject matter for the purpose of deciding potential future disputes between the parties.
In 1983, the mother petitioned the Madison Circuit Court for a custody modification, and that court subsequently held that it had subject-matter jurisdiction over the issue in dispute. The mother's 1983 petition asserted that the Madison Circuit Court had jurisdiction under the Uniform Child Custody Jurisdiction Act. Section 30-3-23, Ala.Code 1975, the section she relied upon, provides, in part:
*133 Because the mother and the child were living in Huntsville when the mother filed her 1983 petition, we hold that the Madison Circuit Court had jurisdiction over issues of custody, under § 30-3-23(a)(1)a., as the mother asserted when she filed the petition.
Some months after the mother filed her petition, the father filed an independent action seeking to enforce a monetary judgment against the mother. Because that action did not involve a question of custody, the trial court would not have had jurisdiction under § 30-3-23 to hear it. However, because the Florida court had, by that time, expressly relinquished its jurisdiction over all issues involved between these parties, we hold that the Madison Circuit Court correctly held in its 1985 order that it had subject-matter jurisdiction to resolve all of the disputes raised by the parties. In essence, it is as if the Madison Circuit Court had been the initial forum.
During the period between the trial court's 1985 order and the mother's 1997 petition for modification, however, the mother and the child moved from Alabama back to Florida. As a result, neither the child nor either of the parties is currently a resident of Alabama. Alabama is thus no longer the child's "home state," and it had not been the child's home state within six months of the filing of the mother's petition to modify the support provisions.[3] Neither the child nor either of the parties has a "significant connection with this state." It is not the case that "[t]here is available in this state substantial evidence" relevant to the resolution of this dispute. The child has not been abandoned in this state. In short, § 30-3-23 specifies that an Alabama court has subject-matter "jurisdiction to make a child custody determination by ... modification decree if" certain conditions exist; none of those conditions is present in this case.
Section 30-3-23 was adopted by the Legislature as a part of the Uniform Child Custody Jurisdiction Act. Ala. Acts 1980, No. 80-92. It was adopted to
§ 30-3-21(a)(3), Ala.Code 1975. Further, § 30-3-21(b) requires that "[t]his article [i.e., the Uniform Child Custody Jurisdiction Act] shall be construed to promote the general purposes stated in this section." It appears, based on the information before this Court, that the mother and the child now have a "closer connection with" the State of Florida.
The act does not appear to have been designed to fulfill the same function with regard to disputes over support as it does for disputes over custody. The key section in question, § 30-3-23, deals with "jurisdiction [of courts] to make a child custody determination." See § 30-3-23(a). Section 30-3-22(2) defines "custody determination":
(Emphasis added.) In light of all of the above, we hold that the provisions of § 30-3-23 require the conclusion that the trial court no longer has subject-matter jurisdiction to modify its 1985 order as it relates to custody of the parties' child. However, that section does not deprive the trial court of continuing subject-matter jurisdiction to modify its 1985 order as it relates to child support "or any other monetary obligation of any person." See Brown v. Brown, 476 So. 2d 114 (Ala.Civ. App.1985). Therefore, we reject the father's second argument.
The father's third argument is that the mother's initial petition in the Madison Circuit Court, the 1983 petition, sought only a modification of the custody provisions of the Florida court's order. Specifically, she sought to have the father's visitation with the child restricted to the mother's home. In her petition, the mother stated that the trial court had jurisdiction under § 30-3-23. "Because the relief sought in the present petition for modification exclusively relates to child support, post-minority support, and other monetary obligations," the father argues, "the trial court lacks subject matter jurisdiction."
The father is correct when he asserts that § 30-3-23 does not relate to determinations of support and other monetary obligations. However, we note that the procedural history of this case does not support the father's position. As we have discussed above, the father's independent action, not related to custody, was consolidated with the mother's custody-modification action. As we have further set out above, the Florida court relinquished its jurisdiction, allowing the conclusion that when the Madison Circuit Court entered its 1985 order its subject-matter jurisdiction was the same as if that court had been the initial forum.
Accordingly, we hold that the trial court did not exceed its subject-matter jurisdiction in ruling on both custody and support matters in its 1985 order. Given the continuing nature of orders such as the 1985 order in this case, the trial court retains subject-matter jurisdiction to modify that 1985 order as to the matter of support. We must reject the father's third argument.
The father also argues that the circuit court lacks subject-matter jurisdiction because, he says, the 1985 judgment based on the parties' agreement was effective for only 10 years. He asserts that, because that period has expired, "there is presently existing no provision for child support or for no child support and thus there is no child support provision to modify." This assertion is unfounded.
Ralls v. Ralls, 383 So. 2d 857, 859 (Ala.Civ. App.1980) (overruled on other grounds). We conclude that, although the 10-year period contemplated in the parties' agreement has expired, the trial court nonetheless retains the authority to modify its order as changing circumstances warrant. We reject the father's fourth argument.
The father finally presents this question: "Can the trial court take jurisdiction of this action over the objection of [the] nonresident father, when jurisdiction properly lies in the State of Florida, where the original judgment was issued and where the child and the mother presently reside[?]" Arguing that the trial court cannot, the father relies on the clause in the Florida court's July 28, 1982, order by which it retained jurisdiction. We note, however, that that court subsequently terminated its own jurisdiction. As a result, and in light of our analysis above, we conclude that the Madison Circuit Court did not exceed its jurisdiction in denying the father's motion to dismiss.[4] We reject the father's fifth argument.
We conclude that the trial court has both in personam jurisdiction over the parties and subject-matter jurisdiction to modify its order with regard to support, although it no longer has subject-matter jurisdiction to *135 modify its previous order with regard to custody.
WRIT DENIED.
HOOPER, C.J., and SHORES, KENNEDY, and SEE, JJ., concur.
MADDOX, Justice.
On original submission, we noted that the petitioner "[did] not argue that the trial court should have declined to exercise jurisdiction on forum non conveniens grounds," and that "[w]e therefore [did] not consider that issue." 728 So. 2d at 134, n. 4. On application for rehearing, he now asks us to consider that issue. However, as we have held, "[t]his Court will not consider an argument raised for the first time on appeal; its review is limited to evidence and arguments considered by the trial court." Abbot v. Hurst, 643 So. 2d 589, 593 (Ala. 1994). The record does not reflect that Carstens raised this argument before the trial court; therefore, we will not consider it now.
OPINION OF AUGUST 7, 1998, CORRECTED; APPLICATION OVERRULED.
HOOPER, C.J., and SHORES, KENNEDY, and SEE, JJ., concur.
[1] That order read:
"ORDER ON PETITIONER'S MOTIONS
"This cause came on to be heard upon the motion of petitioner to determine Pinellas County an inconvenient forum and terminate jurisdiction, and upon motion of petitioner for relief from orders, both of said motions bearing certificate of service of February 9, 1984, and the court having heard argument of counsel and testimony of respondent, it is
"ORDERED that said Motion to Determine Pinellas County An Inconvenient Forum and Terminate Jurisdiction be, and the same hereby is granted and said cause shall hereafter be heard before the Circuit Court of Madison County, Alabama, in which county the minor child now resides; it is further
"ORDERED that the Motion for Relief from Orders be declared moot due to the ruling on the previous motion.
"ORDERED at St. Petersburg, Pinellas County, Florida, this 27[th] day of March, 1984."
[2] Hardy v. Hardy, 250 Ala. 297, 34 So. 2d 212 (1948); Brown v. Brown, 476 So. 2d 114 (Ala.Civ. App.1985).
[3] Although it is unclear when the mother and the child moved from Alabama back to Florida, it appears uncontested that they moved at some point at least six months before the mother filed her petition for modification.
[4] The father does not argue that the trial court should have declined to exercise its jurisdiction on forum non conveniens grounds, as the Florida court did in its March 27, 1984, order. We, therefore, do not consider that issue. | 13165785f1dfc107095d88236a4d728bc54f369f180204e5bb3b6aa64c7ee3e5 | 1998-11-06 00:00:00 |
9201c2bd-2e29-4e03-8dc9-f40febf09be7 | Ex Parte Russell Corporation | 725 So. 2d 264 | 1961114 | Alabama | Alabama Supreme Court | 725 So. 2d 264 (1998)
Ex parte RUSSELL CORPORATION.
(Re Russell Corporation v. Elizabeth McFadden).
1961114.
Supreme Court of Alabama.
August 28, 1998.
*265 W. Scears Barnes, Jr., of Barnes & Radney, P.C., Alexander City, for petitioner.
David W. Vickers of Vickers, Howell & Talkington, L.L.C., Montgomery, for respondent.
MADDOX, Justice.
This is a workers' compensation case involving an employee who, it appears from the record, suffered from carpal tunnel syndrome and related ailments. The trial court entered a judgment for the plaintiff, and the Court of Civil Appeals affirmed that judgment, without opinion. Russell Corp. v. McFadden, 705 So. 2d 888 (Ala.Civ.App.1997) (table). We have granted certiorari review. In order to permit the trial court to review the facts and to apply the law as set out in this opinion, we remand, with instructions.
Because we remand, we make no independent findings of fact, but we briefly set out some of the facts, as reflected in the record, for a better explanation of our decision and why we find it necessary to remand the cause for further proceedings in the trial court. This remand is necessary because we hold that this case is governed by the evidentiary requirement of § 25-5-81(c), Ala.Code 1975, which was added to the Workers' Compensation Statute by Act No. 92-537, Ala. Acts 1992.
Elizabeth McFadden was employed by Russell Corporation as a sewing machine operator. As a result of injuries she claimed to have sustained at work, including carpal tunnel syndrome, McFadden filed a workers' compensation action against Russell. The parties settled that action and the circuit court approved the settlement on August 31, 1993.
McFadden returned to work at Russell, but soon reported additional problems. On December 12, 1993, she filed an injury report with Russell, complaining of pain in her right hand. She was subsequently taken off work and evaluated by several physicians. Ultimately, McFadden filed a new workers' compensation action; that action was set for trial on May 30, 1996, but it was later continued until further discovery was conducted. McFadden amended her complaint to allege that her injury had occurred on October 21, 1994. On June 10, 1996, the circuit court conducted a nonjury trial. On July 25, 1996, the court entered an order finding that McFadden was 100% disabled. The court found that, although the evidence was conflicting, McFadden's complaints of pain were credible and were supported by the evidence. The trial court further found, "after weighing all the medical evidence, evidence which was also conflicting," that McFadden suffered from carpal tunnel syndrome, overwork syndrome or repetitive use syndrome, tenosynovitis, and chronic neuropathies. Finally, the trial court stated that these conditions were "work-related." It entered an amended judgment on August 12, 1996, but did not change McFadden's permanent disability rating. Russell filed a motion to alter, amend, or vacate the trial court's judgment; the *266 court denied that motion, and Russell appealed.
The Court of Civil Appeals, with one Judge dissenting, affirmed, without opinion. In its memorandum of affirmance, the Court of Civil Appeals cited as authority for its affirmance only this Court's case of Ex parte Trinity Industries, Inc., 680 So. 2d 262, 268-69 (Ala.1996). Russell petitioned this Court for certiorari review, arguing that Ex parte Trinity Industries does not apply the correct burden of proof to cases that involve injuries resulting from gradual deterioration or cumulative physical stress disorders and that there was insufficient evidence to indicate that McFadden suffered any injury arising out of and in the course of her employment.
For purposes of this case, McFadden alleged that she suffered her wrist injury in 1994; therefore, this case is governed by the Workers' Compensation Act as amended by Act No. 92-537, which became effective May 19, 1992. Generally, in a workers' compensation case, an appellate court will not reverse a trial court's finding of fact "if that finding is supported by substantial evidence." § 25-5-81(e)(2), Ala.Code 1975; Ex parte Trinity Industries, 680 So. 2d at 268-69. However, in § 26 of Act No. 92-537, codified at § 25-5-81, the Legislature modified the law regarding the evidentiary standard to be applied to workers' compensation cases involving injuries such as carpal tunnel syndrome. That Code section provides, in part:
(Emphasis added.)
It is undisputed that this case involves an injury that is alleged to have resulted from a "cumulative physical stress disorder"; therefore, it is clear that this case is governed by the evidentiary requirement of § 25-5-81(c). Therefore, in order to show that her injury was compensable, McFadden was required to show, by "clear and convincing" evidence, that her injury "arose out of and in the course of [her] employment." § 25-5-81(c).
In order to show why we remand the cause, we first address the Court of Civil Appeals' reliance on Ex parte Trinity Industries. That case involved a claimant who had suffered a stroke while at work. In that case, this Court addressed both the standard of proof required to prove causation in a workers' compensation case and the proper standard for reviewing a workers' compensation case. 680 So. 2d at 265. In terms of the standard of proof required to prove causation, the question presented was whether the claimant had presented "substantial evidence" indicating that his injury was work-related. Id. However, this Court did not discuss whether the evidentiary requirements of § 25-5-81(c) applied to the claim in that case. See Trinity Industries, Inc. v. Cunningham, 680 So. 2d 253, 262 (Ala.Civ. App.1995) (Crawley, J., concurring specially) (noting that the parties raised no issue regarding the requirements of § 25-5-81(c), either in the trial court or on appeal).
In contrast to the situation in Ex parte Trinity Industries, it is clear in the present case that McFadden alleged an injury that resulted from a "cumulative physical stress disorder" and that, therefore, the requirements of § 25-5-81(c) must be applied. Accordingly, to the extent that the Court of Civil Appeals' reliance on Ex parte Trinity Industries implied that McFadden needed only to present "substantial evidence" that her injury "arose out of and in the course of [her] employment," we conclude that that *267 reliance was misplaced. Instead, in order to show that her injury was compensable, McFadden was required to show, by "clear and convincing" evidence, that her injury arose out of and in the course of her employment. § 25-5-81(c), Ala.Code 1975.
In determining whether the plaintiff has met the statutory standard of proof, and in considering other legal issues, the appellate court does not give the trial court's decision a presumption of correctness. See § 25-5-81(e)(1), Ala.Code 1975. We could determine here whether McFadden met her burden in this case, but we believe that justice would best be served by remanding this case with instructions for the trial court to apply the law as set out in this opinion to the particular facts of this case.
This case is remanded for the Court of Civil Appeals to remand it to the circuit court for that court to conduct such further proceedings as are necessary for it to make a finding whether McFadden met her burden of proving by "clear and convincing" evidence that her injury arose out of and in the course of her employment and to enter such orders as the law requires. The Court of Civil Appeals is instructed to direct the circuit court to make a return to it within 60 days of the date of the Court of Civil Appeals' order remanding the case.
The Court of Civil Appeals is similarly instructed to take such action upon receiving the circuit court's return as it deems appropriate and to make a return to this Court within 60 days of the date the circuit court's return is filed in the Court of Civil Appeals.
REMANDED WITH INSTRUCTIONS.
HOOPER, C.J., and HOUSTON and SEE, JJ., concur.
SHORES, KENNEDY, COOK, and LYONS, JJ., concur in the result.
KENNEDY, Justice (concurring in the result).
Although I concur in the result reached by the main opinion, I disagree with the reasoning contained in several sections of that opinion. While the main opinion correctly states that the trial court should have applied the "clear and convincing evidence" standard, it appears to confuse this evidentiary standard with the standard we are to apply on review. In addition, that opinion mischaracterizes the reasoning in Ex parte Trinity Industries, Inc., 680 So. 2d 262 (Ala.1996), further blurring the line between the plaintiff's burden of proof at trial and our standard of review.
Regarding the plaintiff's burden of proof, § 25-5-81(c) specifies two different standards to be applied, depending on the nature of the worker's injury. Section 25-5-81(c) reads, in part:
(Emphasis added.)
In contrast, § 25-5-81(e) sets out the standards by which appellate courts shall review a trial court's findings of fact and rulings of law. Mirroring other common schemes of appellate review, that section reads:
(Emphasis added.) A clear reading of this section requires an appellate court to give deference to the trial court's findings of fact, while reviewing the trial court's legal determinations "without a presumption of correctness." In a workers' compensation action, appellate review of legal issues is de novo, *268 while review of factual determinations is under the "substantial evidence" rule. I respectfully disagree with those sections of the main opinion that indicate otherwise.
SHORES and COOK, JJ., concur.
LYONS, Justice (concurring in the result).
I concur in the judgment reversing the judgment of the Court of Civil Appeals and remanding this case for the trial court to determine whether it applied the "clear and convincing evidence" standard required by Ala.Code 1975, § 25-5-81(c), and, if not, for findings based on that standard. However, I do not think we should reach the issue of the correct standard of appellate review until such time as findings based upon the proper trial standard are before us. | cffdd2eb3f32464f2e866b849970c6d7cc1980c7f31b30154874999c361e7505 | 1998-08-28 00:00:00 |
068e6e8d-5225-4e5f-a164-518d277c1637 | Ex Parte Napier | 723 So. 2d 49 | 1961828 | Alabama | Alabama Supreme Court | 723 So. 2d 49 (1998)
Ex parte Ealon C. NAPIER and Laura Godfrey.
(In re Ealon C. Napier and Laura Godfrey v. John Manning et al.).
1961828
Supreme Court of Alabama.
November 6, 1998.
*50 Joseph C. McCorquodale III and Christopher A. Bailey of McCorquodale & McCorquodale, Jackson; and Timothy C. Hutchinson, Butler, for petitioners.
Jack B. Hinton, Jr., and Steven K. Herndon of Gidiere & Hinton, Montgomery, for John Manning.
Thomas S. Lawson, Jr., and James N. Walter, Jr., of Capell, Howard, Knabe & Cobbs, P.A., Montgomery, for Foremost Insurance Company.
K. Scott Stapp of Manley, Traeger, Perry & Stapp, Demopolis, for Larry D. Johnson, d/b/a Johnson Mobile Homes.
Robert A. Huffaker and Rachel Sanders-Cochran of Rushton, Stakely, Johnston & Garrett, P.A., Montgomery, for Green Tree Financial Servicing Corporation.
Bryan G. Duhé and Thomas H. Benton, Jr., Mobile, for amicus curiae Gifford J. Davis.
LYONS, Justice.
Ealon C. Napier and his sister Laura Godfrey are plaintiffs in an action pending in the Choctaw Circuit Court. They petition for a writ of mandamus directing Judge J. Lee McPhearson to vacate his orders of June 5, 1997, and July 14, 1997, granting the defendants' motions to compel arbitration and ordering the plaintiffs to initiate arbitration proceedings. For the reasons discussed below, we deny the petition.
On June 24, 1994, Napier and Godfrey purchased a new mobile home from Larry D. Johnson, doing business as Johnson Mobile Homes, for $37,028. They paid $10,000 down, and Green Tree Financial Servicing *51 Corporation ("Green Tree") provided financing for the balance of the purchase price. Napier and Godfrey executed a "Manufactured Home Retail Installment Contract and Security Agreement" ("the contract"). Napier and Godfrey were named as buyers, and Johnson Mobile Homes was named as seller. The contract contained an assignment to "Green Tree Financial Corp.-MS."[1] Paragraph 21 of the contract contains the following arbitration clause:
In connection with the sale of the mobile home, Johnson sold to Napier and Godfrey an insurance policy covering the mobile home; the policy was issued by Foremost Insurance Company ("Foremost"). The annual premium was $516 for the policy year 1994-95 and $546 for the policy year 1995-96. John Manning was the agent for Foremost in Alabama who countersigned the mobile home policy. Napier and Godfrey were required by the contract to name Green Tree as an additional insured under any insurance policy they obtained. Green Tree is so designated in the Foremost policy purchased by Napier and Godfrey.
On June 19, 1996, Napier and Godfrey sued Manning, Johnson, Foremost, Green Tree, and certain fictitiously named parties, alleging fraudulent misrepresentation, fraudulent suppression, deceit, and conspiracy to defraud in connection with the sale of the mobile home and the sale of the insurance policy covering the mobile home. They filed the action in the Choctaw Circuit Court. The defendants removed the case to the *52 United States District Court for the Southern District of Alabama, but that court remanded the case to the Circuit Court of Choctaw County. All of the defendants then filed motions to compel arbitration, and Napier and Godfrey opposed those motions. The trial court granted the motions to compel arbitration. Napier and Godfrey then filed this petition for the writ of mandamus.
"A writ of mandamus is an extraordinary remedy that requires the showing of: (1) a clear legal right in the petitioner to the order sought; (2) an imperative duty on the respondent to perform, accompanied by a refusal to do so; (3) the lack of another adequate remedy; and (4) the properly invoked jurisdiction of the court." Ex parte McNaughton, [Ms. 1961708, August 28, 1998] ___ So.2d ___, ___ (Ala.1998). A petition for a writ of mandamus is the proper means by which to challenge a trial court's order granting a motion to compel arbitration. Ex parte Phelps, 672 So. 2d 790 (Ala.1995). We review an order granting or denying a motion to compel arbitration under an abuse-of-discretion standard. Capital Investment Group, Inc. v. Woodson, 694 So. 2d 1268 (Ala. 1997).
Napier and Godfrey contend that the trial court abused its discretion in compelling arbitration without addressing their contentions that the contract lacked mutuality of remedy and that the contract was unconscionable. In support of their argument that the contract lacked mutuality and that in negotiating they were in an inferior bargaining position, Napier and Godfrey rely on Northcom, Ltd. v. James, 694 So. 2d 1329 (Ala. 1997). In Northcom, two Justices on this Court stated in dictum:
694 So. 2d at 1338. We rejected this reasoning in Ex parte McNaughton, ___ So.2d at ___; therefore, Napier and Godfrey's argument regarding the doctrine of mutuality of remedy must fail.
Napier and Godfrey also argue that the trial court abused its discretion in compelling arbitration without requiring a clear showing by the defendants that enforcement of the arbitration clause would not be unconscionable. A court should refuse to enforce an arbitration agreement where the record supports a determination of unconscionability. See Ex parte Dan Tucker Auto Sales, Inc., 718 So. 2d 33 (Ala.1998) (Lyons, J., concurring specially). The only evidence submitted on this issue is contained in Laura Godfrey's affidavit, in which she testified that she was 77 years old, did not finish high school, had poor eyesight, had difficulty reading, and could not read small print. Godfrey also testified that Napier, her brother, was 72 years old, did not finish high school, and had difficulty reading. Godfrey has not asserted, however, additional matters that could be germane to a determination of unconscionability, such as a refusal of her request for assistance after she had notified someone that she was unable to see or to understand; her inability to obtain the product made the basis of this action from this seller, or from another source, without having to sign an arbitration clause; the oppressiveness or unfairness of the mechanism of arbitration;[2] or the fairness of a discount or other quid pro quo in exchange for her accepting an arbitration agreement.
Napier and Godfrey again rely on dictum in Northcom to support their argument that the defendants should have the burden of proving that the arbitration clause is not unconscionable, because of the constitutional issues they say are raised by a plaintiff's *53 contention of unconscionability in the context of an arbitration clause. See Northcom, 694 So. 2d at 1339. We reject this argument regarding the allocation of the burden of proof. Under general principles of law, the party asserting the defense of unconscionability has the burden of proving unconscionability. If we shifted the burden of proof on the issue of unconscionability, because of the implications arising from alleged violations of the Alabama Constitution, then we would violate the principles of Doctor's Associates, Inc. v. Casarotto, 517 U.S. 681, 116 S. Ct. 1652, 134 L. Ed. 2d 902 (1996), a case condemning state law that assigns suspect status to arbitration agreements. Napier and Godfrey had the burden of proving that the arbitration clause was unconscionable. They did not present substantial evidence to support a finding of unconscionability.
Napier and Godfrey also contend that the trial court abused its discretion in compelling them to arbitrate their claims against Foremost Insurance Company and its agent Manning, because neither Foremost nor Manning was a signatory to the arbitration agreement. Foremost and Manning contend that the claims against them are so "intimately founded in and intertwined with" the claims against Green Tree and Johnson that all of the claims are subject to arbitration. See Sunkist Soft Drinks, Inc. v. Sunkist Growers, Inc., 10 F.3d 753, 757 (11th Cir. 1993), cert. denied, 513 U.S. 869, 115 S. Ct. 190, 130 L. Ed. 2d 123 (1994) (quoting McBro Planning & Dev. Co. v. Triangle Elec. Constr. Co., 741 F.2d 342, 344 (11th Cir. 1984)). Foremost and Manning argue that the scope of the arbitration agreement in this case is broad enough to encompass Napier and Godfrey's claims against them, even though they are not signatories to the contract containing the arbitration agreement, and that the plaintiffs' allegations of conspiracy against all defendants connect the claims against the nonsignatory defendants to the claims against the signatory defendants.
In Med Center Cars, Inc. v. Smith, [Ms. 1960214, September 4, 1998] ___ So.2d ___ (Ala. 1998), we examined the question whether claims against nonsignatories were subject to arbitration. Like Foremost and Manning, the nonsignatory defendants in Med Center Cars argued that the scope of the arbitration agreement was broad enough to encompass the claims against them and that the plaintiffs' allegations of conspiracy compelled the arbitration of intertwined claims. However, we concluded in Med Center Cars that the language of the arbitration agreement was not broad enough to encompass claims against nonsignatories and that the plaintiffs' conspiracy claims, which alleged generally that a combination of defendants had conspired to violate Alabama law, had not been developed sufficiently to allow us to determine which defendants, if any, had conspired against the plaintiffs. We are presented with a different situation in the case before us.
First, the arbitration clause in this case is broad enough to encompass Napier and Godfrey's claims against Foremost and Manning. In Ex parte Gates, 675 So. 2d 371 (Ala.1996), this Court discussed an arbitration clause identical to the arbitration clause in this case. In Ex parte Martin, 703 So. 2d 883 (Ala. 1996), the Court, distinguishing Gates, said that the arbitration clause in Gates contained language that was "particularly broad, encompassing not only the `disputes, claims, or controversies arising from' the contract, but also `the relationships' that resulted from it." Martin, 703 So. 2d at 886. Insurance coverage for potential physical damage to the mobile home was an indispensable element of the contract executed by Napier and Godfrey, without which Green Tree would not have agreed to finance their purchase. Therefore, the arbitration clause in the contract encompasses disputes arising out of the relationship of insured and insurer that resulted from the contract.
Second, we conclude that Napier and Godfrey's claims against the signatory defendants and those against the nonsignatory defendants are sufficiently intertwined that all claims must be arbitrated. Napier and Godfrey allege that the insurance on their mobile home was "force-placed," that the defendants misrepresented to them matters such as the necessity for the insurance and *54 the amount of the insurance, and that certain persons accepted "kickbacks."[3] Furthermore, Napier and Godfrey allege that the four named defendants conspired against them. Their conspiracy allegations state:
Unlike the general conspiracy allegations in Med Center Cars, which did not identify the defendants who were alleged to have been involved in the conspiracy, the complaint in this case makes specific allegations of conspiracy against Foremost and Manning, in addition to Green Tree and Johnson. Therefore, the claims against the nonsignatories have a connection to the claims against the signatories that is sufficient to subject all of the claims to arbitration.
We conclude that the trial court did not abuse its discretion in granting the defendants' motions to compel arbitration. Napier and Godfrey have not shown a clear legal right to the order they seek. Therefore, their mandamus petition is denied.
WRIT DENIED.
HOOPER, C.J., and MADDOX, HOUSTON, and SEE, JJ., concur.
COOK, J., concurs in the result.
ALMON, SHORES, and KENNEDY, JJ., dissent.
ALMON, Justice (dissenting).
The arbitration clause placed by Green Tree[4] into the financing contract of which it takes assignment should not be specifically enforced. Green Tree reserves to itself the right "to use judicial or non-judicial relief," 723 So. 2d at 51, and yet compels consumers to submit any claims they might have against Green Tree to arbitration, with an arbitrator "selected by Assignee." Further, when Green Tree files an action in a court of law, it retains the right to compel arbitration of a counterclaim filed by the consumer. Green Tree, the party in the superior position, gives itself the right of access to a court of law, but denies that right to the inferior party.
The inequity of this clause and its effect is shown by the fact that, before moving to compel arbitration, Green Tree removed the action to a federal court. Only when the federal court remanded the case did Green Tree move to compel arbitration. Surely this amounted to a waiver of the right to compel specific performance of the arbitration clause.
A majority of this Court, in Ex parte McNaughton, [Ms. 1961708, August 28, 1998] ___ So.2d ___ (Ala.1998), disapproved of the reasoning in Northcom, Ltd. v. James, 694 So. 2d 1329 (Ala. 1997), regarding contracts of adhesion, lack of mutuality of remedy (where one side can compel specific performance of an arbitration clause, but the other cannot), and unconscionability. Nevertheless, the Supreme Court of the United States, in Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, *55 Inc., 473 U.S. 614, 627, 105 S. Ct. 3346, 87 L. Ed. 2d 444 (1985), has stated the ground on which a court should not order specific performance of such a one-sided arbitration clause: "Of course, courts should remain attuned to well-supported claims that the agreement to arbitrate resulted from the sort of fraud or overwhelming economic power that would provide grounds `for the revocation of any contract.'" (Emphasis added.)
For the reasons stated herein and in my dissent in Ex parte McNaughton, supra, I dissent from the denial of the petition for the writ of mandamus.
[1] We note that the designation of the assignee in the contract executed by Napier and Godfrey is different from the designation of the Green Tree defendant in this case. None of the parties mentions this discrepancy, however, and Napier and Godfrey do not contend that the Green Tree entity they have sued is not the assignee named in their contract.
[2] For a provocative discussion of concepts of fairness in the context of arbitration of consumer claims, see A Due Process Protocol for Mediation and Arbitration of Consumer Disputes, American Arbitration Association, May 1998.
[3] In Ex parte Isbell, 708 So. 2d 571 (Ala. 1997), the Court declined to order arbitration as to claims against a nonsignatory where the plaintiffs' claims against the nonsignatory arose out of a separate warranty and not the sales contract. The Court held that the plaintiffs could not be compelled to arbitrate claims arising from the warranty. Here, we are not dealing with a claim arising under the insurance policy, but with alleged fraud in the sale of the product with accompanying insurance.
[4] I pass over the question whether the defendant in this action is the assignee of the contract, or whether two separate Green Tree corporations are involved. See footnote 1 to the majority opinion, 723 So. 2d at 51. | a3a544b433eda5c522d01d5399af13e2cf21832e6552fc1ea4fe23816631e105 | 1998-11-06 00:00:00 |
6dc07473-df1a-4f0f-846a-eccfb08dccad | Marriott Intern., Inc. v. deCELLE | 722 So. 2d 760 | 1962174 | Alabama | Alabama Supreme Court | 722 So. 2d 760 (1998)
MARRIOTT INTERNATIONAL, INC.
v.
Gregory T. deCELLE.
1962174.
Supreme Court of Alabama.
September 11, 1998.
*761 Barre C. Dumas of Dumas & McPhail, L.L.C., Mobile, for appellant.
Steven L. Nicholas of Olen, McGlothren & Nicholas, P.C., Mobile, for appellee.
SEE, Justice.
This case concerns whether a signatory to a guaranty contract is liable in his individual capacity. When the creditor sued to collect on the guaranty from the signatory in his individual capacity, the trial court granted the signatory's motion to dismiss. Because the contract as a whole is ambiguous as to whether the parties intended the signatory to be liable in his individual capacity, we reverse and remand.
From the record, the facts appear as follows: Sum Big Stores, Inc., was indebted to Marriott International, Inc. ("Marriott"). Marriott had Gregory deCelle, the president of Sum Big Stores, sign a continuing guaranty of the debt of Sum Big Stores. The first page of the guaranty agreement reads in pertinent part:
(Emphasis added.) The second page of the guaranty agreement reads in pertinent part:
After an apparent default, Marriott sued Mr. deCelle, in his individual capacity, on the guaranty contract for $52,217.11 owed by Sum Big Stores, Inc. Marriott attached to its complaint the second page of the two-page guaranty agreement signed by Mr. deCelle. Mr. deCelle moved to dismiss the action against him in his individual capacity. Before the trial court ruled on Mr. deCelle's motion to dismiss, Marriott submitted to the trial court a memorandum of law opposing Mr. deCelle's motion to dismiss and including the first page of the guaranty agreement.[1] The trial court then granted Mr. deCelle's motion to dismiss, with leave for Marriott to amend its complaint. Instead of amending *762 the complaint, Marriott filed a motion to alter, amend, or vacate the judgment of dismissal. The trial court denied the motion.
On appeal, Marriott argues that the trial court erred in dismissing its complaint. Mr. deCelle responds by arguing that the trial court correctly dismissed the complaint because he signed the guaranty agreement in his representative capacity and therefore could not be personally liable for the debt owed to Marriott.[2]
A trial court should grant a motion to dismiss only when the allegations of the complaint itself clearly demonstrate that the plaintiff does not have a claim. Carter v. Calhoun County Bd. of Educ., 345 So. 2d 1351, 1353 (Ala.1977). A motion to dismiss should be granted only if it appears that the plaintiff can prove no set of facts in support of his claims entitling him to relief. Smith v. Potts, 293 Ala. 419, 424, 304 So. 2d 578, 582 (1974).
The complaint alleges that Mr. deCelle is individually liable for the debt to Marriott. Although the guaranty agreement shows that Mr. deCelle signed in his representative capacity as president of Sum Big Stores, Inc., the body of the guaranty contract, provided by Marriott in its memorandum of law opposing the motion to dismiss, states that the undersigned "individual" guarantees the debts of Sum Big Stores, Inc. See Cue Fashions, Inc. v. LJS Distribution, Inc., 807 F. Supp. 334, 336 (S.D.N.Y.1992) (considering an insurance contract as the basis for the defendant's motion for judgment on the pleadings, even though the contract was not attached to the complaint but was supplied in the plaintiff's opposition papers) (citing Goldman v. Belden, 754 F.2d 1059, 1065-66 (2d Cir.1985), and I. Meyer Pincus & Assocs. v. Oppenheimer & Co., 936 F.2d 759, 762 (2d Cir.1991)).
The general rule of contract law provides that if a written contract exists, the rights of the parties are controlled by that contract and parol evidence is not admissible to contradict, vary, add to, or subtract from its terms. Clark v. Albertville Nursing Home, Inc., 545 So. 2d 9, 11 (Ala.1989). However, if the contract is ambiguous, parol or extrinsic evidence will be allowed to clarify the contract. Cummings v. Hill, 518 So. 2d 1246, 1247 (Ala.1987). In determining whether a contract is ambiguous as to the capacity in which a party signed it, this Court looks to the consistency between the body of the contract and the signature block. For example, in Professional Business Systems, Inc. v. Kaufman, 507 So. 2d 421 (Ala. 1987), this Court addressed whether a person signing a contract for the payment of a debt signed in his individual capacity or in his representative capacity. The body of the contract stated that the debtor was a corporation, and the signature block indicated that the person signed as an officer of the corporation. Id. at 422. This Court held that, taken as a whole, the contract consistently stated that the person was signing in his representative capacity. Id. Thus, the contract was not ambiguous, and the signatory was not liable in his individual capacity. Id.
In Lutz v. Van Heynigen Brokerage Co., 199 Ala. 620, 628-29, 75 So. 284, 287-88, this Court addressed whether a person had signed a contract for the charter of a schooner in his individual capacity or in his representative capacity. The body of the contract indicated that he had signed as a representative, but the signature block indicated that he had signed as an individual. Id. This Court held that, taken as a whole, the contract was *763 inconsistent as to the whether the person had signed in his individual capacity or in his representative capacity. Id. Thus, the contract was ambiguous, and parol evidence was admissible to determine the intent of the parties. Id.
In this case, the body of the guaranty contract indicates that Mr. deCelle, in his individual capacity, guaranteed the debt of Sum Big Stores, but the signature block indicates that Mr. deCelle, in his representative capacity, signed for Sum Big Stores. Taken, as a whole, the guaranty contract is inconsistent as to the whether Mr. deCelle signed in his representative capacity. Thus, the contract is ambiguous as to whether the parties intended Mr. deCelle to guarantee the debt in his individual capacity. See Lutz, 199 Ala. at 628-29, 75 So. at 287-88.
We do not think the allegations of the complaint clearly demonstrate that Marriott can prove no set of facts under which Mr. deCelle would be liable on the guaranty contract. Accordingly, we reverse the trial court's judgment dismissing the action and remand this case for further proceedings not inconsistent with this opinion.
REVERSED AND REMANDED.
HOOPER, C.J., and MADDOX, SHORES, HOUSTON, COOK, and LYONS, JJ., concur.
KENNEDY, J., concurs in the result.
[1] Mr. deCelle does not dispute that the document submitted with Marriott's memorandum of law was in fact the first page of the guaranty agreement that he signed.
[2] We note that as a continuing guaranty that is not payable at a definite time, the guaranty in this case is not a negotiable instrument and is thus not governed by the signature provision of Ala.Code 1975, § 7-3-402. See Ala.Code 1975, § 7-3-102(a) ("This article [Article 3] applies to negotiable instruments."); § 7-3-104(a) (defining a "negotiable instrument" as an unconditional promise to pay a fixed amount, payable to bearer or to order, on demand or at a definite time, and not stating any other undertaking or instruction by the person promising to pay); see, e.g., Woods-Tucker Leasing Corp. v. Kellum, 641 F.2d 210, 216 fn. 9 (5th Cir.1981) (stating that the Uniform Commercial Code was not applicable to a continuing guaranty); Liberty Bank v. Shimokawa, 2 Haw.App. 280, 282-83, 632 P.2d 289, 291-92 (1981) (stating that a continuing guaranty is not a negotiable instrument); Gregoire v. Lowndes Bank, 176 W.Va. 296, 342 S.E.2d 264 (1986) (same). | 56b0ac4458371cc4e5bd98b32097db823a7efddeaecef68a1f0d24812ea7bdb9 | 1998-09-11 00:00:00 |
0e22e248-84b5-4bfd-ae85-3587150a6dc0 | Georgia Power Co. v. Partin | 727 So. 2d 2 | 1961192 | Alabama | Alabama Supreme Court | 727 So. 2d 2 (1998)
GEORGIA POWER COMPANY and Jerry Ledbetter
v.
Jerry PARTIN and Brenda Partin.
1961192.
Supreme Court of Alabama.
September 4, 1998.
Rehearing Denied December 11, 1998.
*3 Vernon L. Wells II and Emily Sides Bonds of Walston, Wells, Anderson & Bains, Birmingham, for appellants.
*4 Mark A. Stephens, Deborah Alley Smith, and Rhonda Pitts Chambers of Rives & Peterson, P.C., Birmingham, for appellees.
LYONS, Justice.
Georgia Power Company and Jerry Ledbetter, defendants in an action pending in the Colbert Circuit Court, appeal from an order denying their motions to compel arbitration and to stay proceedings pending arbitration of the claims brought by the plaintiffs Jerry Partin and his wife Brenda Partin. We reverse and remand.
On October 7, 1991, Jerry Partin suffered an injury in the course of his employment as a maintenance foreman for Orba Corporation. On that day, Partin was occupied with loading coal at the Pride Transloading Facility ("Pride Facility"), which was owned by Georgia Power Company and operated by Orba Corporation. He was injured when he fell from a catwalk on the end of a slowly moving railcar owned and operated by Norfolk Southern Railway Company.
At the time of Partin's injury, Orba Corporation maintained the Pride Facility pursuant to a written "operations agreement" with Georgia Power. Among other things, the operations agreement required Georgia Power to construct and equip the Pride Facility and made Georgia Power responsible for any defects or deficiencies in the construction or maintenance of the facility. The operations agreement specified the duties of each party and it was signed by agents for Georgia Power and Orba Corporation. It contained an arbitration clause, which provided, in pertinent part:
Jerry Partin sued Georgia Power, Norfolk Southern, and his Georgia Power supervisor, Jerry Ledbetter, alleging that the defendants had negligently or wantonly failed to provide him with a safe workplace. In his claim against Georgia Power, Partin specifically alleged that Georgia Power had been negligent or wanton in failing to correct unsafe work procedures, in maintaining the Pride Facility, in failing to provide adequate lighting at the facility, and in failing to construct a crosswalk over the trains. Jerry Partin's wife, Brenda, joined his action, seeking damages for loss of consortium.
Over three years later, and after the case had been set for trial, the Partins moved to amend their complaint to add an additional claim against Georgia Power alleging a breach of the operations agreement between Georgia Power and Orba Corporation. The amended complaint alleged that the operations agreement established a master-servant relationship between Georgia Power and Orba Corporation; that the operations agreement provided specifications for the maintenance of the Pride Facility; that Georgia Power had failed to meet those specifications; and that Georgia Power's failure resulted in injury to Jerry Partin. The Partins specifically alleged that Jerry Partin was "a third-party beneficiary of said contract, and [that] the breach of said contract ... by Georgia Power Company was a direct and proximate cause of [his] injuries and damages as described in the original [complaint]."
The trial court granted the Partins' motion to amend and, 12 days later, Georgia Power and Ledbetter moved to compel arbitration of all claims and to stay proceedings pending arbitration of the claims, pursuant to the arbitration clause contained within the operations agreement between Georgia Power and Orba Corporation. The defendants argued that, although the Partins were not signatories to the agreement containing the arbitration provision, their claims were nevertheless arbitrable because Jerry Partin claimed to be a third-party beneficiary of the agreement.
The Partins argued to the trial court that the arbitration clause could not be enforced against Jerry Partin because he was not a signatory to the agreement between Georgia *5 Power and Orba Corporation. They further argued that the defendants had waived any right to enforce the arbitration agreement against Jerry Partin by delaying over three years before moving to compel arbitration. They also argued that the arbitration agreement was not enforceable against Brenda Partin in regard to her loss-of-consortium claim and that Jerry Ledbetter had no standing to enforce the arbitration clause because he was not a signatory to the contract. The trial court denied the arbitration motions, without stating its reasons for doing so. Georgia Power and Ledbetter appeal.
Under the Federal Arbitration Act, 9 U.S.C. § 2 et. seq., ("FAA"), a "written arbitration provision" is enforceable if it appears in a "contract evidencing a transaction involving [interstate] commerce." The parties do not dispute that Georgia Power and Orba Corporation entered into a valid arbitration agreement, nor do they dispute that the arbitration agreement appeared in a contract evidencing a transaction involving interstate commerce.
Both federal and state courts have consistently recognized that the duty to arbitrate is a contractual obligation and that a party cannot be required to arbitrate any dispute that he or she has not agreed to submit to arbitration. AT & T Technologies, Inc. v. Communications Workers of America, 475 U.S. 643, 106 S. Ct. 1415, 89 L. Ed. 2d 648 (1986); A.G. Edwards & Sons, Inc. v. Clark, 558 So. 2d 358 (Ala.1990). Because arbitration is a creature of contract, ordinary contract principles govern the interpretation of an agreement to arbitrate. Ex parte Jones, 686 So. 2d 1166 (Ala.1996). It is a well-established principle of Alabama law that a contract made for the benefit of a third person may, at his election, be accepted and enforced by him. Michie v. Bradshaw, 227 Ala. 302, 149 So. 809 (1933). However, "[i]f he claims the benefits [of the contract], he also assumes the burdens." Michie, 227 Ala. at 308, 149 So. at 814. See, also, Ex parte Dyess, 709 So. 2d 447 (Ala.1997) (non-signatory plaintiff claiming the benefit of a contract as a third-party beneficiary is subject to arbitration agreement within that contract). "The law is clear that a third party beneficiary is bound by the terms and conditions of the contract that it attempts to invoke. `The beneficiary cannot accept the benefits and avoid the burdens or limitations of a contract.'" Interpool Ltd. v. Through Transport Mut. Ins. Ass'n Ltd., 635 F. Supp. 1503, 1505 (S.D.Fla.1985), quoting Trans-Bay Engineers & Builders, Inc. v. Hills, 551 F.2d 370, 378 (D.C.Cir.1976). See, also, Dunn Constr. Co. v. Sugar Beach Condominium Ass'n, Inc., 760 F. Supp. 1479 (S.D.Ala. 1991); Lee v. Grandcor Medical Systems, Inc., 702 F. Supp. 252, 255 (D.Colo.1988) ("A third party beneficiary must accept a contract's burdens along with its benefits."). It is thus clear that a third-party beneficiary cannot accept the benefit of a contract, while avoiding the burdens or limitations of that contract. Jerry Partin brought his breach-of-contract claim as a third-party beneficiary of the operations agreement between Orba Corporation and Georgia Power, and, thus, has chosen to accept and enforce all of its terms, including the arbitration clause that he seeks to avoid.
Jerry Partin argues that, even if the arbitration clause applies to his breach-of-contract claim, it does not apply to his negligence claims against Georgia Power. He points out that the arbitration clause in the operations agreement provides that arbitration would apply "[i]n the event of any dispute, difference of opinion or controversy between the parties as to any question of fact which may arise under this Agreement," if either party requested arbitration. (Emphasis added.) He contends that this language makes the arbitration clause enforceable only as to disputes that are strictly contractual; however, in his brief to the trial court in support of his motion to amend the complaint, he admitted that "[t]he contract establishes certain elements of control by the defendant Georgia Power Company which create a master-servant relationship giving rise to its duty to the plaintiff and that "the contract in this case goes to he very heart of the merits of the action."
In order for a dispute to be characterized as arising out of the subject matter of *6 a contract, for the purposes of arbitration, it must at the very least raise some issue that cannot be resolved without a reference to, or a construction of, the contract itself. Koullas v. Ramsey, 683 So. 2d 415 (Ala.1996). It is clear that Jerry Partin's complaint alleging negligence, although initially expressed in ignorance of the contractual relationship, was later amended to assert a claim alleging the breach of certain duties that he alleges were owed to him by Georgia Power, and it is clear that these duties are alleged to have arisen from Georgia Power's operations contract with Orba Corporation. Because both the contract claims and the tort claims, after the amendment of the complaint, involve questions of fact as to Georgia Power's duties to Jerry Partin arising from the operations agreement, we agree that both kinds of claims are included within the scope of the arbitration agreement in that contract.
Georgia Power and Ledbetter next argue that the trial court erred in failing to grant their motion to compel arbitration of Jerry Partin's claims against Ledbetter, who was not a signatory to the operations agreement. At the time of the accident, Ledbetter was employed by Southern Company Services as Georgia Power's representative at the Pride Facility, and his presence at the Pride Facility was sanctioned by § 3.2(m) of the operations contract.[1] Jerry Partin's claims against Ledbetter are based solely on Ledbetter's alleged acts of negligence and/or wantonness as an agent of Georgia Power. Jerry Partin alleges that Ledbetter, as an agent for Georgia Power, controlled Jerry Partin's work methods and the conditions he worked in, so that Ledbetter's alleged failure to provide adequate lighting at the Pride Facility on the night of Jerry Partin's accident proximately caused his injury.
This Court has established that a party may not avoid an arbitration agreement merely by suing a nonsignatory employee of a principal. Ex parte Gray, 686 So. 2d 250 (Ala.1996). Jerry Partin is clearly suing Ledbetter in his capacity as a Georgia Power agent, based upon the alleged breach of certain duties he says were created by the operations agreement. Because he is essentially suing Georgia Power through his claims against Ledbetter, we agree that Ledbetter is entitled to the benefit of the contract signed by Georgia Power and may enforce its arbitration provision.
Georgia Power and Ledbetter next argue that the trial court erred in denying their motions to compel arbitration of Brenda Partin's loss-of-consortium claim. We have not previously considered whether a loss-of-consortium claim brought by a nonsignatory spouse must be arbitrated along with the claims of an injured spouse. We have held that although a loss-of-consortium claim is derivative of the claims of an injured spouse, Ex parte N.P., 676 So. 2d 928 (Ala.1996), it is also a separate claim that is distinct from the claims of the injured spouse, Mattison v. Kirk, 497 So. 2d 120, 123 (Ala.1986) ("The wife's right of recovery depends only upon a showing of liability on the part of [the] third-party [d]efendants. To make her case, she simply must prove that her husband's injury was caused by [the defendants'] wrongful acts and that, as a result, she lost her husband's consortium from the time of the injury...."). Brenda Partin alleges that her husband Jerry Partin was injured as a result of the same alleged breach of duties that Jerry Partin bases his personal-injury claims upon. Although her claim is for damages separate from his, it nevertheless springs from the same source, i.e., the operations contract, which the Partins admit goes to the very heart of this action.
Some jurisdictions that have addressed the issue of the arbitrability of a nonsignatory spouse's loss-of-consortium claim have determined that merely because a loss-of-consortium claim is derivative, it must be arbitrated along with the injured spouse's claims. See Bombalier v. Lifemark Hosp. of Florida, 661 So. 2d 849 (Fla.Dist.Ct.App.1995), review denied, 666 So. 2d 901 (Fla.1996) (spouse who has derivative claim for loss of consortium *7 has interest in litigation only in privity to the husband's claims, so that her claims must be arbitrated if her husband's claims are deemed arbitrable); Jozwiak v. Northern Michigan Hospitals, Inc., 207 Mich.App. 161, 524 N.W.2d 250 (1994) (like a spouse's claim for loss of consortium, a child's independent action for the loss of society and companionship of an injured parent is derivative and must be arbitrated along with the parent's claims).
However, we are more persuaded by the reasoning in A.L. Williams & Associates, Inc. v. McMahon, 697 F. Supp. 488 (N.D.Ga. 1988), where the United States District Court for the Northern District of Georgia held that an insurance agent's spouse, who was a nonsignatory to the agent's agreements with an insurer, could not assert a loss-of-consortium claims arising out of those agreements without abiding by the arbitration clauses contained therein. The court stated that "a party cannot have it both ways; it cannot rely on the contract when it works to its advantage and then [repudiate] it when it works to its disadvantage." Id., at 494. Thus, the court concluded, the agent's spouse could not assert claims allegedly arising out of the agreements executed by her husband, without being required, herself, to abide by the arbitration clauses in those agreements. Id.
Although Brenda Partin's loss-of-consortium claim is separate from her husband's, she alleges that her injury was caused by the same breach of duties that her husband says resulted in his injury. As we have discussed, the Partins themselves concede in their pleadings that the existence and scope of these duties are based upon the terms of the operations agreement between Georgia Power and Orba Corporation. We therefore agree that, because Brenda Partin's claims are based upon the contract, her claims are subject to the arbitration clause contained therein.
Having determined that the Partins' claims against Georgia Power and Ledbetter are subject to the arbitration agreement in the operations contract, we must address whether Georgia Power waived its right to compel arbitration by failing to do so until over three years after the litigation began. The Partins originally alleged tort claims only, based on Jerry Partin's personal injury; there was no claim based upon the operations agreement and no allegation that Jerry Partin was a third-party beneficiary of that agreement. Georgia Power argues that it did not have standing to compel arbitration pursuant to the operations agreement until the Partins amended their complaint to add a breach-of-contract claim based upon Jerry Partin's alleged status as a third-party beneficiary of that contract. Georgia Power moved to compel arbitration 12 days after the Partins amended their complaint.
A court will not find a waiver of the right to arbitration unless the party seeking arbitration has so substantially invoked the litigation process that to compel arbitration will substantially prejudice the party opposing it. Ex parte Phelps, 672 So. 2d 790 (Ala.1995). A party's participating in discovery at a time before the claim becomes arbitrable is not a factor to be considered in determining whether a waiver has occurred, Ex parte McKinney, 515 So. 2d 693 (Ala. 1987). The law does not require the futile gesture of asking for arbitration before a claim becomes arbitrable; any delay in seeking arbitration should be measured from the time the claim becomes arbitrable. Belke v. Merrill Lynch, Pierce, Fenner & Smith, 693 F.2d 1023, 1026 (11th Cir.1982), overruled on other grounds, Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213, 105 S. Ct. 1238, 84 L. Ed. 2d 158 (1985). The evidence shows that Georgia Power promptly moved to compel arbitration after the Partins' amended complaint made their claims subject to the arbitration clause in the operations agreement; therefore, the substantial litigation that had preceded the filing of the amended complaint is not a proper basis for finding a waiver in this case.[2]
*8 Based upon the foregoing, we hold that the trial court erred in denying the defendants' motions to compel arbitration of the Partins' claims and to stay proceedings pending arbitration. The circuit court's order denying the motions is reversed and the cause is remanded for the entry of an order consistent with this opinion.
REVERSED AND REMANDED.
HOOPER, C.J., and MADDOX, HOUSTON, and SEE, JJ., concur.
ALMON, SHORES, KENNEDY, and COOK, JJ., dissent.
SHORES, Justice (dissenting).
Under the holding in this case, the plaintiffs could have avoided arbitration by not amending their complaint to state a contract claim. I agree with this conclusion. However, it does not follow that the act of amending to state the contract claim makes the plaintiffs' noncontract claims also subject to arbitration. If, as the majority says, the contract goes to the "very heart" of the matter upon which the original complaint was based, 727 So. 2d at 5, then Georgia Power waived its right to compel arbitration as to the noncontract claims by engaging in the litigation process for three years. Ex parte Phelps, 672 So. 2d 790 (Ala.1995).
Georgia Power and Jerry Ledbetter (Jerry Partin's supervisor) substantially participated in the discovery process (15 depositions were taken) and sought judicial intervention by moving for a summary judgment. To move for a summary judgment is to substantially participate in litigation, and it clearly indicates an intention to abandon the right to arbitrate. Ex parte Prendergast, 678 So. 2d 778 (Ala.1996). The defendant's participating in the litigation process for three years amounts to an enforceable waiver of the right to arbitrate the noncontract claims, and it supports the trial court's denial of the defendants' motions to compel arbitration. Companion Life Insurance Co. v. Whitesell Mfg., Inc., 670 So. 2d 897, 899 (Ala.1995).
ALMON and KENNEDY, JJ., concur.
[1] Section 3.2(m) of the contract requires Orba Corporation to provide office space and incidental office services to "one representative of Georgia Power"; it is undisputed that Ledbetter was the representative referred to in this provision.
[2] Although the dissent refers to the Partins' "contract claim," 727 So. 2d at 8, we emphasize that the Partins' amended complaint was based on Jerry Partin's claim that he was a third-party beneficiary of the contract between Orba Corporation and Georgia Power. The Partins' original complaint asserted claims independent of the contract. Before Partin asserted his third-party beneficiary claim, Georgia Power and Ledbetter had no legal basis upon which they could have enforced the arbitration agreement, which appeared in a contract to which the Partins were not parties. Therefore, Georgia Power and Ledbetter could not waive their right to arbitrate the Partins' noncontract claims by participating in the litigation process as to those claims, until after the Partins, for the first time, affirmatively availed themselves of the benefits of the contract. Cf. Benoay v. Prudential-Bache Securities, Inc., 805 F.2d 1437 (11th Cir.1986) (even though defendants did not move to compel arbitration for over two years after commencement of civil action, they could not have obtained an order compelling arbitration until after the United States Supreme Court changed the law to require arbitration of pendent arbitrable claims even if arbitrable and nonarbitrable claims were intertwined; therefore, they did not waive their right to arbitrate, and their motion to compel, filed 10 weeks after their right to arbitrate accrued, was timely). Once the Partins amended their complaint, the tort claims they had originally asserted became intertwined with the contract claims, so that all of their claims now are subject to arbitration. | 2e8ff6a18b8787538386513a946a7a625752f7a09de04b57ffcb4efa670a40e9 | 1998-09-04 00:00:00 |
dd46543f-cb84-4b12-8776-293baff2f3d4 | Scott v. Villegas | 723 So. 2d 642 | 1971421 | Alabama | Alabama Supreme Court | 723 So. 2d 642 (1998)
Larry Shane SCOTT
v.
Armando VILLEGAS, Jr.
1971421.
Supreme Court of Alabama.
November 13, 1998.
W. Lloyd Copeland and T. Jefferson Deen III of Clark, Deen & Copeland, P.C., Mobile, for appellant.
Robert G. Jackson and Anthony M. Hoffman of Zieman, Speegle, Oldweiler & Jackson, L.L.C., Mobile, for appellee.
HOUSTON, Justice.
Larry Shane Scott sued Armando Villegas, Jr., alleging negligence and wantonness in connection with a motor-vehicle accident in which Scott was injured; he demanded a trial by jury. Villegas moved for a summary judgment, based on Alabama's Guest Statute, Ala.Code 1975, § 32-1-2, arguing that there was no evidence of wantonness, which would be required for liability to exist under the Guest Statute. Scott conceded that he was a guest in Villegas's automobile, but argued that he had the substantial evidence of wantonness necessary to create a fact question for the jury's determination. The trial court entered a summary judgment for Villegas. Scott appeals from the summary judgment, but only as to the count alleging wantonness.
Our standard for reviewing a summary judgment is well settled. See Ex parte Coleman, 705 So. 2d 392 (Ala.1997).
Scott argues that he presented the substantial evidence of wantonness necessary to create a jury question as to whether Villegas was liable under the Guest Statute and thereby to defeat Villegas's motion for summary judgment. According to Scott, there was substantial evidence from which a jury could reasonably infer that Villegas knew he was unable to safely handle the automobile he was driving, an automobile with which he was unfamiliar, "especially when giving it gas," but that he persisted in operating the automobile and operated it with knowledge that injury to himself or others would likely or probably result. Clearly, Scott says, the jury reasonably could have inferred that Villegas, who had lost control of the automobile three times before this particular accident, and in a manner similar to the way in which he lost control in this accident, knew the automobile was likely to spin or fishtail out of control and that he continued to drive the automobile heedless of the consequences.
For Villegas to be liable under the Guest Statute, Scott had to show that Villegas's *643 actions amounted to wanton conduct. The Guest Statute, § 32-1-2, reads:
(Emphasis added.) In Alfa Mutual Ins. Co. v. Roush, 723 So. 2d 1250 (Ala.1998), this Court clarified the definition of "wantonness":
Wantonness requires more than a mere showing of some form of inadvertence on the part of the driver; it requires a showing of some degree of conscious culpability. See Ex parte Anderson, 682 So. 2d 467, 469 (Ala. 1996); see, also, George v. Champion Ins. Co., 591 So. 2d 852 (Ala.1991). "The actor's knowledge may be proved by showing circumstances from which the fact of knowledge is a reasonable inference; it need not be proved by direct evidence." Hamme v. CSX Transp., Inc., 621 So. 2d 281, 283 (Ala.1993).
The applicable standard of review requires us to view the evidence in the light most favorable to Scott, the nonmoving party. Viewed in that light, the evidence suggests the following facts:
Villegas had just purchased a 1990 Ford Mustang GT-50 model automobile and at the time of the accident he was taking Scott to get fender trim for Scott's automobile. Scott was a nonpaying guest in Villegas's automobile. Villegas had driven the automobile only one time before he bought it and he was "kind of not used to" driving it because, he said, it was "souped up." The automobile had a 5-speed transmission and a V-8 engine. According to Villegas, "It was a fast car.... It was bad."
On the day of the accident, it had been raining and the roads were wet; at times it was misting. When Villegas pulled out of the driveway, around 4:30 or 5:00 p.m., the automobile stalled. Scott asked if he could drive. Scott had driven the automobile several times while it was owned by the person from whom Villegas purchased it. Villegas told him, "No. I want to drive my car."
Thereafter, as Villegas was driving down the road, he "[spun] off" because, he said, "I wasn't used to it because it was tight gears and you had to give it some gas. So I mean I fishtail[ed] a little bit, not much." At that point, Scott again asked if he could drive, and Villegas told him, "I want to drive my car." Then, at an intersection with a traffic light, Villegas "gave it a little too much gas and it spun a little bit more." Once again, Scott asked if he could drive, and Villegas told him, "I want to drive my car."
At another intersection with a traffic light, Villegas "[spun] off again." After this incident, Villegas told Scott, "If I mess up one more time, you can drive the car."
Subsequently, "because [Villegas and Scott were] in a hurry to get" to his destination, he shifted from fifth gear into third gear and passed another automobile; Villegas's automobile went into a spin, struck another automobile, spun some more, and turned over. When Villegas was asked what he thought caused the spin, he testified as follows:
According to Scott, the following occurred:
We are convinced from our review that Scott presented substantial evidence from which the jury could infer that Villegas was guilty of "wanton conduct," as that term is defined in Alabama statutory law and caselaw. Alfa Mut. Ins. Co. v. Roush, supra. In other words, viewing the evidence in the light most favorable to Scott, we conclude that there is substantial evidence from which the jury could find that Villegas acted with a reckless or conscious disregard of the rights or safety of others by consciously driving the automobile while knowing that he could not control it on the wet pavement and knowing that if he lost control of it, injury would likely or probably result. Therefore, the question of wantonness should have been submitted to the jury.
We reverse the judgment of the trial court and remand the cause for further proceedings consistent with this opinion.
REVERSED AND REMANDED.
HOOPER, C.J., and MADDOX, ALMON, SHORES, KENNEDY, COOK, SEE, and LYONS, JJ., concur. | fb10b512c32b024b26b155729a12cad8ac79b42a36d0e072eb9601c1d9f456e7 | 1998-11-13 00:00:00 |
d38d46b8-1710-4caa-a011-b1b01bd71b78 | Ex Parte Independent Life & Acc. Ins. Co. | 725 So. 2d 955 | 1971126 | Alabama | Alabama Supreme Court | 725 So. 2d 955 (1998)
Ex parte INDEPENDENT LIFE AND ACCIDENT INSURANCE COMPANY et al.
(Re Mary L. White, individually and as administratrix of the estate of Henry Jordan, deceased; and Joe G. Young
v.
Independent Life and Accident Insurance Company et al.)
1971126.
Supreme Court of Alabama.
September 11, 1998.
Rehearing Denied November 20, 1998.
*956 E. Glenn Waldrop, Jr., and William H. Brooks of Lightfoot, Franklin & White, L.L.C., Birmingham, for petitioners.
Paul C. Williams, Tyrone C. Means, and James L. Richey of Thomas, Means & Gillis, P.C., Montgomery, for respondents.
MADDOX, Justice.
This petition for a writ of mandamus arises from the trial court's denial of the defendants' motion to transfer an action pursuant to § 6-3-21.1, Ala.Code 1975, the forum non conveniens statute.
Independent Life and Accident Insurance Company and three of its agents, defendants in an action pending in the Lowndes Circuit Court, petition for an order directing that court to vacate an order denying a motion to transfer the cause to the Montgomery Circuit Court. Because the facts of this case clearly show that the defendants are entitled to the relief authorized by the Legislature under the forum non conveniens statute, we grant the petition.
In August 1995, Mary White and her common-law husband Joe Young bought several life insurance policies from Independent Life. One of those was a $10,000 policy insuring the life of White's father, Henry Jordan; he died 13 months later. Upon Jordan's death, White and Young filed a claim for benefits under the policy. Independent Life told them that Jordan's policy had lapsed for failure to pay premiums and, therefore, that no benefits were due.
White and Young sued Independent Life and three of its agents. Their action, filed in the Lowndes Circuit Court, alleged breach of contract; bad-faith failure to pay an insurance claim; fraudulent misrepresentation; fraudulent suppression; fraud by deceit; conversion; negligent hiring, training and supervision; and negligence or wantonness. In their answer, each of the defendants objected to having the action tried in Lowndes County. Independent Life subsequently moved to transfer the action to Montgomery County under § 6-3-21.1, Ala.Code 1975.[1] The trial court denied that motion, and this petition followed.
In its motion to transfer, Independent Life set forth the following facts:
(1) The plaintiffs live in Montgomery County.
In their brief to this Court, the defendants further point out that Independent Life maintains no office in Lowndes County.
One of the named defendants, Sonya Axel, lives in Lowndes County, but the materials before this Court indicate that Axel did not sell the plaintiffs any of the policies now at issue. Further, the defendants assert that Axel did not handle any of the premiums related to the plaintiffs' policies now at issue.
The question is not whether venue was proper in Lowndes County, but whether the trial court abused its discretion in denying the motion, made pursuant to § 6-3-21.1, to transfer the case to Montgomery County, where the plaintiffs reside and where the policies were sold.
Before we address our reasons for granting the mandamus petition, we point out that this Court's opinion in Ex parte First Family Financial Services, Inc., 718 So. 2d 658 (Ala. 1998), was released after the trial court had ruled on Independent Life's motion and after the parties had filed their briefs in this Court.
Our decision in First Family is controlling in this case. In First Family, this Court was presented with a strikingly similar set of facts: the plaintiff sued "`in a county where [the plaintiff] did not live, where the defendant has no office, and which has no relationship whatsoever to [the plaintiff] or [her] claims.'" 718 So. 2d at 659. In this present case, all of the transactions at issue took place in Montgomery County; the plaintiffs live in Montgomery County; the three agents all work out of Independent Life's Montgomery office; and, based on what is before us, it appears that the one agent who lives in Lowndes County did not sell any of the policies at issue, and, at most, played a minor role in the events giving rise to this action. Furthermore, it appears that each of that defendant's conversations with the plaintiffs took place at their house in Montgomery County, not in Lowndes County. From what is before this Court, therefore, it appears that this case has no nexus with Lowndes County that would justify burdening that county with the trial of this case.
Based on the factual similarity of this case to First Family, we conclude that First Family, with its interpretation of § 6-3-21.1, Ala.Code 1975, controls. Accordingly, the Lowndes Circuit Court is directed to vacate its order of March 3, 1998, denying the transfer motion and is directed to transfer the pending action to the Montgomery Circuit Court.
PETITION GRANTED.
HOOPER, C.J., and HOUSTON, KENNEDY, SEE, and LYONS, JJ., concur.
SHORES and COOK, JJ., dissent.
COOK, Justice (dissenting).
I respectfully dissent. I am now certain of what I suspected in Ex parte First Family Financial Services, Inc., 718 So. 2d 658 (Ala. 1998) (Cook, J., dissenting), namely, that a majority of this Court has begun reviewing change-of-venue cases de novo, on the basis of the "in the interest of justice" phrase appearing in Ala.Code 1975, § 6-3-21.1, the forum nonconveniens statute.[3] I stated in my dissent that case:
718 So. 2d at 662-63 (Cook, J., dissenting) (emphasis in First Family). Although the majority in this present case purports to consider "whether the trial court abused its discretion in denying [the defendant's] motion... to transfer," 725 So. 2d at 957, it is clear to me that the abuse-of-discretion standard is not the one it applies.
Will this Court always better understand what is "in the interest of justice" than the trial court? It seems so, according to the majority in the last two change-of-venue cases we have decided. The majority has seized upon the phrase as the foundation of a new doctrine.
The facts of this case illustrate my point even better than the facts in Ex parte First Family. In that case, although the defendant did not assert that it did not do business in the forum county, "the plaintiff [had] never lived in the forum county. No transaction between the plaintiff and the defendant [had] ever occurred there," and "[t]he defendant [had] no office, employees, or documents in the forum county." 718 So. 2d at 659.[4] In this present case, at least one of the defendants does live in the forum county and some of the defendants have "debit routes" that take them into the forum county.[5] Thus, the majority in this present case extends the rule it adopted in Ex parte First Family.
The Legislature did not include the phrase "in the interest of justice" as a means to provide appellate courts an excuse to review trial court orders de novo. Today's majority opinion directly opposes the will of the Legislature. For these reasons, I respectfully dissent.
SHORES, J., concurs.
[1] The materials before this Court suggest that only Independent Life moved for a transfer, but the three agents have joined Independent Life as petitioners seeking the writ of mandamus. The plaintiffs make no issue of the fact that the three agents did not join Independent Life's motion to transfer.
[2] These transactions all took place either at the plaintiffs' home, at the deceased's home, or at Independent Life's office. All three are located in Montgomery County.
[3] Section 6-3-21.1 provides in pertinent part:
"(a) With respect to civil actions filed in an appropriate venue, any court of general jurisdiction shall, for the convenience of parties and witnesses, or in the interest of justice, transfer any civil action or any claim in any civil action to any court of general jurisdiction in which the action might have been properly filed...."
(Emphasis added.)
[4] The majority held that the "`interest of justice'... would be served by transferring the case to a more convenient forum." 718 So. 2d at 659.
[5] In addition, I point out that the forum county is adjacent to the transferee county. In fact, the county seat of the forum county is approximately 20 miles from Montgomery, the seat of the transferee county. This Court has held that a distance of 35 miles from the seat of a forum county to the seat of the transferee county was "not so great that the trial court can be said to have abused its discretion" in refusing to transfer an action pursuant to § 6-3-21.1. Ex parte Moore, 642 So. 2d 457, 461 (Ala.1994). | c23ccde3636dff11773a706e046bf6a9995589c4b631ee2201558884e6fc0583 | 1998-09-11 00:00:00 |
a60c992c-5bb1-456c-b8c8-5825e91dd643 | Town of Loxley v. Coleman | 720 So. 2d 907 | 1961647 | Alabama | Alabama Supreme Court | 720 So. 2d 907 (1998)
TOWN OF LOXLEY and Barbara Denham
v.
Wilmer B. COLEMAN.
1961647.
Supreme Court of Alabama.
August 7, 1998.
Rehearing Denied October 23, 1998.
*908 M. Kathryn Knight of Miller, Hamilton, Snider & Odom, L.L.C., Mobile, for appellants.
Wilmer B. Coleman, appellee, pro se.
LYONS, Justice.
The Town of Loxley ("the Town") and Barbara Denham are defendants in an action pending in the Baldwin Circuit Court. We granted them permission, pursuant to Rule 5, Ala. R.App. P., to appeal from the trial court's order rejecting their claims of immunity and denying their motions for a summary judgment. We affirm in part, reverse in part, and remand.
The plaintiff, Wilmer B. Coleman, is a state prisoner who participated in a work-release program through which he worked for the Town. Denham is an employee of the Town. She was operating a truck, transporting inmates, when Coleman fell from the back of the truck. Coleman, acting pro se, sued the Town and Denham, alleging that they had negligently or wantonly caused the injuries he claims he incurred in the fall. The Town and Denham moved for a summary judgment, arguing that they were entitled to the protection of sovereign immunity. The trial court denied their summary judgment motions.
Article I, § 14, Ala. Const. of 1901, gives the State immunity from suit. Officers, employees, and other agents of the State enjoy immunity as well, except in circumstances where they are acting either "illegally, fraudulently, in bad faith, beyond [their] authority, or under a mistaken interpretation of law, or where the lawsuit seeks to compel the performance of a legal duty or a ministerial act or to enjoin the enforcement of an unconstitutional law, or where the action is brought under the Declaratory Judgment Act." Ex parte Alabama Dep't of Forensic Sciences, 709 So. 2d 455, 457 (Ala.1997).
We first must determine whether the Town and Denham were acting as agents of the State when Coleman fell. If so, they are entitled to the protection of the State's immunity from suit pursuant to § 14, Ala. Const. of 1901, unless one of the exceptions applies. See Alexsis, Inc. v. Terry, 675 So. 2d 1321 (Ala.Civ.App.1996) (holding that the company administering a self-insurance program for the Department of Transportation was an agent for the Department and was, therefore, immune from suit). See, also, Bowden v. Southern Risk Servs., Inc., 574 So. 2d 813 (Ala.Civ.App.1990), cert. quashed, 574 So. 2d 815 (Ala.1991). Had the Department of Corrections been transporting Coleman, there would be no question that the doctrine of sovereign immunity would apply. We conclude that the Town and Denham were acting as agents of the State, by reason of their service in transporting Coleman and other inmates as a part of the work-release program.
We next consider whether Denham was entitled to immunity in her individual capacity. Because on its face Coleman's complaint makes no allegation giving rise to a claim against Denham in her official capacity as a State agent, we need not address whether *909 Denham would have immunity in her official capacity. In addition, because the complaint makes no claim against Denham in her individual capacity for a tort committed by her while she was acting as an agent of the State and within the line and scope of her employment or duties (the allegation being that when Coleman fell, Denham was engaged in "horseplay" and thus was acting outside the line and scope of her employment or duties), we need not address the question whether a copy of the complaint should have been served on the attorney general. See § 36-1-6.1, Ala.Code 1975.
An agent of the State is not protected by absolute immunity when a complaint alleges negligent or wanton conduct, but in such a case the agent may be entitled to qualified immunity. Ex parte Alabama Dep't of Forensic Sciences, 709 So. 2d at 457-58. In the context of a State agent's tort liability, the agent claiming immunity must demonstrate that in regard to the action alleged, the agent was discharging a discretionary, rather than a ministerial, function. Id. The availability of immunity is a question of law to be decided by the trial court. Grant v. Davis, 537 So. 2d 7, 8 (Ala.1988).
Coleman alleges that Denham was engaged in "horseplay" when the accident occurred. The Town and Denham contend that when Coleman fell from the truck Denham was driving around potholes and thus was exercising her judgment in determining the best and safest way to negotiate road hazards and how best to return the inmates safely to their prison camp. "[D]iscretionary functions are characterized by planning and decision-making, while ministerial functions are characterized by operational tasks." Ex parte Alabama Dep't of Forensic Sciences, 709 So. 2d at 458. Where the exercise of a defendant's function requires due care, rather than difficult decision-making, the function is merely ministerial. Bell v. Chisom, 421 So. 2d 1239, 1241 (Ala.1982). Clearly, trying to avoid potholes while driving a motor vehicle is a ministerial, and not a discretionary, function. Denham was not entitled to qualified immunity in her individual capacity; therefore, the trial court properly denied the summary judgment as to Coleman's claims against Denham.
Coleman contends that the Town is liable under the doctrine of respondeat superior based upon Denham's acts. The Town argues that Denham's immunity should entitle it to immunity as well. Because we conclude that Denham is not entitled to immunity in her individual capacity, we need not address this argument.
Finally, we address the Town's argument that it is immune from Coleman's claims of "gross negligence" and wanton misconduct, by reason of § 11-47-190, Ala.Code 1975, which limits the liability of a municipality to negligence. The word "gross," when used in connection with the word "negligence," implies nothing more than simple negligence. Stringer v. Alabama Midland R.R., 99 Ala. 397, 13 So. 75 (1893). This Court has construed § 11-47-190 to exclude liability for wanton misconduct. Hilliard v. City of Huntsville, 585 So. 2d 889, 891 (Ala. 1991). The Town is entitled to a partial summary judgment as to Coleman's claim alleging wanton misconduct; however, the trial court properly denied the summary judgment as to Coleman's other claims against the Town.
We reverse that aspect of the trial court's order denying a summary judgment as to Coleman's wantonness claim against the Town; we affirm the order in all other respects. We remand this cause for the entry of a partial summary judgment in favor of the Town as to Coleman's wantonness claim and for further proceedings as to his remaining claims.
AFFIRMED IN PART; REVERSED IN PART; AND REMANDED.
HOOPER, C.J., and MADDOX, ALMON, SHORES, HOUSTON, KENNEDY, and SEE, JJ., concur.
COOK, J., concurs in the result. | bc66cb05bcfdbceae9dc33141f307d32f02912bbf48659eb36418b7be9fbc2d7 | 1998-08-07 00:00:00 |
5eb32ffb-5fe0-4580-9412-937ac4d9a9a1 | Ex Parte Thomas | 723 So. 2d 1261 | 1971197 | Alabama | Alabama Supreme Court | 723 So. 2d 1261 (1998)
Ex parte Billy THOMAS.
(Re Billy Thomas
v.
State of Alabama).
1971197.
Supreme Court of Alabama.
November 13, 1998.
*1262 Billy Thomas, petitioner, pro se.
Bill Pryor, atty. gen., and Stephanie M. Morman, asst. atty. gen., for respondent.
KENNEDY, Justice.
Billy Thomas, an inmate incarcerated in the Limestone Correctional Facility in Capshaw, petitions for a writ of mandamus directing Judge James W. Woodroof to grant his request to proceed in forma pauperis on a petition seeking medical treatment. We grant the petition in part.
Thomas petitioned the Circuit Court of Limestone County, in December 1997, for medical treatment. He alleged that he was suffering from head pains, chest pains, irregular heartbeat, blurred vision, and dizziness. Thomas alleged that he had informed the medical staff at the prison of the problems, but that he had been given no relief. Thereafter, Thomas, attempting to proceed in forma pauperis, filed an "affidavit of substantial hardship" and requested that the circuit court order the Alabama Department of Corrections to have him transported to a medical center for a CAT scan or an MRI test to determine the cause of his problems and to see if a neurologist's consultation would be necessary. On January 6, 1998, the Limestone County Circuit Court, without inquiry, denied Thomas's request to proceed in forma pauperis and dismissed his case for failure to state a claim upon which relief could be granted.
On January 27, 1998, Thomas again petitioned the circuit court for medical treatment and filed a second affidavit of substantial hardship. Judge Woodroof denied that petition, without inquiry, stating that "the court has no jurisdiction of this matter." On January 28, 1998, Thomas filed a notice of appeal with the clerk of the Court of Civil Appeals. Rather than return the notice of appeal for Thomas to file it with the Limestone Circuit Court, the Court of Civil Appeals transferred it to this Court. We decided to treat Thomas's improperly filed notice of appeal as a petition for the writ of mandamus. We ordered answers and briefs, limited to the issue whether the trial court had erred in denying Thomas in forma pauperis status.
We conclude that the Limestone Circuit Court erred when, without inquiry, it denied Thomas's request to proceed in forma pauperis. Moreover, the circuit court erred in ruling on the merits of Thomas's petition for medical treatment after denying his request to proceed in forma pauperis. When the circuit court denied his request to proceed in forma pauperis, it lacked jurisdiction to rule on the merits of his petition. The petition for the writ of mandamus is, therefore, due to be granted in part.
The circuit court is directed to vacate its order denying Thomas's request to proceed in forma pauperis and to permit Thomas to proceed with his petition for medical treatment, without paying a docket fee. However, the circuit court may require the payment of a docket fee if Thomas is not in fact indigent.
WRIT GRANTED.
*1263 MADDOX, SHORES, HOUSTON, COOK, and LYONS, JJ., concur.
HOOPER, C.J., dissents. | 9c5fc39c96f9f0c627ef85a34ee7b4d5624f5d1adb73935036ef0734c13765c6 | 1998-11-13 00:00:00 |
29e5a784-b0af-4b51-9b92-7665baf6a37b | Ex Parte Children's Hosp. of Alabama | 721 So. 2d 184 | 1970089, 1970092, 1970098 | Alabama | Alabama Supreme Court | 721 So. 2d 184 (1998)
Ex parte The CHILDREN'S HOSPITAL OF ALABAMA.
Ex parte The UNIVERSITY OF ALABAMA HEALTH SERVICES FOUNDATION, P.C., et al.
Ex parte Alan F. JACKS, M.D.
(Re John Curtis HOWELL et al. v. David Andrew ROWLAND et al.)
1970089, 1970092 and 1970098
Supreme Court of Alabama.
August 28, 1998.
*185 Robert E. Parsons and Dorothy A. Powell of Parsons, Lee & Juliano, P.C., Birmingham, for petitioner The Children's Hospital of Alabama.
Robert D. Norman and Thomas A. Kendrick of Norman, Fitzpatrick, Wood & Kendrick, Birmingham, for petitioners The University of Alabama Health Services Foundation, P.C., Dr. Patricia A. Aronin, and Dr. Michael Rauzzino.
Crawford S. McGivaren, Jr., and Melanie M. Bass of Cabaniss, Johnston, Gardner, Dumas & O'Neal, Birmingham, for petitioner Alan F. Jacks, M.D.
D. Leon Ashford and Bruce J. McKee of Hare, Wynn, Newell & Newton, Birmingham; and William H. Atkinson of Fite, Davis, Atkinson, Guyton & Bentley, P.C., Hamilton, for respondents John Curtis Howell, John W. Howell, and Teresa Howell.
SEE, Justice.
The Children's Hospital of Alabama; The University of Alabama Health Services Foundation, P.C.; Dr. Patricia Aronin; Dr. Michael Rauzzino; and Dr. Alan F. Jacks (collectively, the "Health Care Defendants") petition this Court for writs of mandamus directing the Circuit Court of Walker County *186 to grant their motions to transfer the medical malpractice claims filed against them to the Circuit Court of Jefferson County, which would require the severance of those claims from the non-medical malpractice claims remaining in the Circuit Court of Walker County. The Health Care Defendants maintain that under Ala.Code 1975, § 6-5-546, Jefferson County is the only appropriate venue for the malpractice claims because all of the alleged acts of malpractice occurred in Jefferson County. We grant the petitions.
In October 1992, Curt Howell, a minor, was severely injured when he was struck by an automobile while riding his bicycle near his home in Walker County. Howell was initially treated at Walker Regional Medical Center. He was then transferred to Children's Hospital in Jefferson County. The Health Care Defendants treated Howell in Jefferson County.
In 1992, Howell, acting through his parents, filed his initial complaint against the owner of the automobile and against several other defendants who were not health care providers. In May 1993, Howell filed his first amendment to the complaint, adding several medical malpractice claims and adding several health care providers as defendants. This first amendment to the complaint, among other things, listed fictitious defendants who he alleged had negligently failed to "provide a detailed, complete and reliable history of the ... treatment which had been rendered at Walker Regional Medical Center." In June 1993, Children's Hospital moved to transfer the claims to Jefferson County. The trial court denied the motion.
The parties conducted extended discovery spanning approximately four years. As discovery progressed, Howell filed additional amendments to his original complaint, adding new claims and new named and fictitious defendants. Each amendment continued to assert the claims made in the prior amendments, including the claims involving Walker Regional Medical Center. However, Howell listed only fictitious health care providers as defendants responsible for the alleged negligence at Walker Regional Medical Center.
On May 22, 1997, Howell filed his fifth and final amendment to the complaint. The amendment reiterated the claims made in the prior amendments, again listing only fictitious health care providers as defendants responsible for the alleged negligence at Walker Regional Medical Center. On September 9, the trial court accepted the final amendment. On September 16, Children's Hospital moved, pursuant to Ala.Code 1975, § 6-5-546, to transfer the claims to Jefferson County. The other Health Care Defendants made similar motions.
On October 1, 1997, the trial court held a hearing regarding the motions to transfer. At the hearing, Howell's attorney stated that Howell would name no Walker County health care providers as defendants. On October 8, the trial court issued an order denying as untimely the Health Care Defendants' motions to transfer. The Health Care Defendants petition this Court to direct the Walker Circuit Court to transfer the medical malpractice claims to Jefferson County.
A petition for the writ of mandamus is the proper procedure for challenging a trial court's refusal to transfer an action based on improper venue. Ex parte Alabama Power Co., 640 So. 2d 921, 922 (Ala. 1994). A writ of mandamus is appropriate when the petitioner makes a clear showing of error on the part of the trial court. Id. The Health Care Defendants argue that venue is proper in Jefferson County as to the medical liability claims against them and that they made a timely objection, under § 6-5-546, to venue in Walker County. Howell argues that although venue may have been proper in Jefferson County under the special venue provision of § 6-5-546, the Health Care Defendants did not timely object to venue in Walker County.
Before 1987, medical liability actions were governed by the general rules of venue found in the Code of Alabama 1975. See, e.g., Ala.Code 1975, § 6-3-2(a)(3) (providing for venue in the county where an individual *187 defendant resides); § 6-3-6 (providing for venue in a county where a defendant unincorporated organization or association does business or has a branch or local organization); § 6-3-7 (providing for venue in the county where the personal injury occurred or where the domestic corporation defendant does business); Ex parte Terrell, 503 So. 2d 847, 848 (Ala.1987) (stating that venue for a medical malpractice action against a corporate defendant was properly determined under § 6-3-7). Where, because of the joinder of several claims or parties, statutes make venue proper in more than one county, Rule 82(c), Ala. R. Civ. P., provides that venue will be proper "in any county in which any one of the claims could properly have been brought."[1]
With respect to the timing of challenges to venue in medical liability actions prior to 1987, Ala.Code 1975, § 6-3-21 provided the general rule that "[a] defendant in a civil action may move for a transfer of venue as provided in the Alabama Rules of Civil Procedure." Rule 12(h)(1) provides the general timing rule applicable to a defendant's challenge of venue by a motion or responsive pleading.[2] Rule 82(d)(2)(C)(i) provides the general timing rule for multiple-party actions, requiring a defendant to challenge venue within 30 days of the dismissal of the party that had made venue proper in the forum.[3] If the defendant did not strictly adhere to the timing requirements, his challenge to venue was waived. Rules 12(h)(1), 82(d)(2)(C)(iii), Ala. R. Civ. P.
Thus, in drafting a new statute with respect to a particular cause of action, the Legislature can either default to the general venue statutes, by not mentioning venue, or it can make special statutory provisions for venue for that particular cause of action. Similarly, with respect to challenges to venue, the Legislature can leave the timing of such challenges to the general provisions of the rules, by not mentioning a timing requirement for challenging venue; this is what it did in §§ 6-3-2, 6-3-6, and 6-3-7.[4]*188 Alternatively, it could make special provisions for the timing of challenges to venue, by specifically addressing such timing in the statute, as it did in § 6-3-20.[5]
In 1987, the Legislature enacted the Alabama Medical Liability Act of 1987 (the "1987 Act"). Acts 1987, No. 87-189, p. 261 (codified at Ala.Code 1975, §§ 6-5-540 to 552). The 1987 Act was designed to control "the spiraling costs ... of essential medical services caused by the threat of [medical liability] litigation." Ala.Code 1975, § 6-5-540. Evidently unsatisfied with the application of the general venue statutes to medical liability actions, the Legislature chose not to default to §§ 6-3-2, 6-3-6, and 6-3-7 by remaining silent. Instead, it expressly provided a special medical liability venue statute in the 1987 Act. See City of Birmingham v. Hendrix, 257 Ala. 300, 307, 58 So. 2d 626, 633 (1952) (stating that in attempting to discern the legislative intent of a statute, it is permissible to look to the law as it existed before the statute was enacted). Section 6-5-546 provides in pertinent part:
(Emphasis added.) Under § 6-5-546, if the acts or omissions giving rise to medical liability occurred in one county, an action based on those acts or omissions "must" be brought in that county. If the acts or omissions giving rise to medical liability occurred in more than one county, however, then an action based on those acts or omissions "must" be brought in the county where the plaintiff resided at the time of the acts or omissions.
In Ex parte Kennedy, 656 So. 2d 365 (Ala. 1995), this Court dealt with an action that involved both a workers' compensation claim and medical liability claims. These claims respectively made venue proper in Walker County and in Jefferson County. Under the general provision of Rule 82(c), Ala. R. Civ. P., if venue was proper as to any claim or defendant, then it was proper as to all claims or defendants. This Court rejected a construction of § 6-5-546 that would have made that statute subject to Rule 82(c), holding instead that § 6-5-546 required that a medical liability action "must" be brought in the county where the act or omission took place. Concluding that the statute and the rule were in conflict, this Court held that § 6-5-546 took precedence over the rule. Kennedy, *189 656 So. 2d at 367-68. This Court further held that the medical malpractice claims had to be severed from the workers' compensation claims and transferred to Jefferson County. Id. at 368-69.
In the case now before us, if Howell had named a defendant health care provider responsible for the negligence alleged to have occurred at Walker Regional Medical Center, then, under § 6-5-546, the presence of both Walker County defendants and the Jefferson County Health Care Defendants would have placed venue in Walker County, where Howell resided. See § 6-5-546 (stating that where "acts or omissions ... took place in more than one county within the State of Alabama, the action must be brought in the county wherein the plaintiff resided"). When Howell's counsel conceded that Howell would name no health care defendants regarding acts or omissions alleged to have occurred in Walker County, § 6-5-546 required that the health care claims "must" be transferred to Jefferson County, upon motion of any defendant. All of the Health Care Defendants moved to transfer the claims to Jefferson County. Howell contends that their motions were untimely under the general timing provisions of Rule 12(h)(1) and Rule 82(d)(2)(C)(i). Based on the plain language of the timing sentence of § 6-5-546, we disagree.[6]
The 1987 Act also addressed the timing of venue challenges. Evidently unsatisfied with the application of the general timing provisions of the rules to medical liability actions, the Legislature chose not to default to Rule 12(h)(1) or Rule 82(d)(2)(C)(i) by remaining silent. Instead, it expressly provided a special timing sentence in § 6-5-546. See Hendrix, 257 Ala. at 307, 58 So. 2d at 633. The special timing sentence in § 6-5-546 reads:
(Emphasis added.) The plain meaning of these words is that if "at any time prior to the commencement of the trial," any party "show[s]" that venue is improper under § 6-5-546, a single defendant may then make a "motion" to transfer the malpractice claims, and the trial court "shall" grant that motion. See City of Montgomery v. Water Works & Sanitary Sewer Bd., 660 So. 2d 588, 592 (Ala. 1995) (requiring that words used in a statute be given their natural, plain, ordinary, and commonly understood meaning); Tuscaloosa County Comm'n v. Deputy Sheriffs' Ass'n, 589 So. 2d 687, 689 (Ala.1991) (stating that where plain language is used, a court is bound to interpret the language to mean exactly what it says). By providing that both the showing of improper venue and the motion to transfer could be made "at any time prior to the commencement of the trial," the Legislature showed a clear intent to assure that the new venue benefit conferred on health care defendants would not be vitiated by the strict timing provisions of Rule 12(h)(1) and Rule 82(d)(2)(C)(i).
Despite the plain language of the sentence in § 6-5-546 specifically addressing the timing of venue challenges in medical liability actions, Howell argues that the timing provisions of Rule 12(h)(1) or of Rule 82(d)(2)(C)(i) control whether the Health Care Defendants waived their right to challenge venue.[7] Specifically, Howell argues *190 that although § 6-5-546 may conflict with Rule 82(c), as this Court held in Kennedy, supra, the statute's timing provisions do not conflict with Rule 82(d). This attempt to retain the action in Walker County by avoiding a conflict between the rules and the timing sentence of § 6-5-546 fails because it neither avoids conflict nor allows the key phrase of the statutory sentence "at any time prior to the commencement of the trial" a meaningful field of operation.
First, it could be argued that a conflict between the rule and § 6-5-546 could be avoided by construing the statutory phrase "at any time prior to the commencement of the trial" to modify only the phrase "it is shown," and not the phrase "on motion of any defendant." Under such a construction, motions to transfer under § 6-5-546, if not showings of improper venue, could still be subject to the rules. Such a construction, however, does not avoid a conflict. Rule 82(d)(2)(C)(i) expressly allows a showing of improper venue to be made even after "the trial of the action has commenced."[8] To the contrary, the timing sentence of § 6-5-546 expressly requires that any showing of improper venue be made "at any time prior to the commencement of the trial." (Emphasis added.) Under the rule, a post-commencement showing of venue is allowed; under the statute, it is not. Moreover, Rule 82(d)(2)(A) provides that "the court, on motion of less than all remaining defendants, in its discretion, may ... transfer." (Emphasis added.) To the contrary, the timing sentence of § 6-5-546 provides that "on motion of any defendant the court shall transfer." (Emphasis added.) Under the rule, fewer than all of the remaining defendants do not have the power to require a transfer; under the statute, they do. Thus, even if the key phrase of the timing sentence of § 6-5-546 "at any time prior to the commencement of the trial" is artificially construed to modify only the "showing" and not the "motion," the statute still conflicts with the rule.[9]
Second, if the key phrase of the timing sentence of § 6-5-546 "at any time prior to the commencement of the trial" is construed to modify neither the showing of improper venue nor the motion to transfer, then the phrase would be rendered meaningless. Before the enactment of § 6-5-546, Rule 12(h)(1) and Rule 82(d)(2)(C)(i) governed the timing of motions to challenge venue. Presuming, as we must, that the Legislature was aware of these rules, the Legislature could not have intended to include a meaningless phrase "at any time *191 prior to the commencement of the trial" in a sentence governing the timing of venue challenges. See Blue Cross & Blue Shield of Alabama, Inc., v. Nielsen, 714 So. 2d 293 (Ala.1998) ("It is a familiar principle of statutory interpretation that the Legislature, in enacting new legislation, is presumed to know the existing law."); Elder v. State, 162 Ala. 41, 45, 50 So. 370, 371 (1909) (stating that it is unreasonable to hold that the Legislature employed meaningless words); Sheffield v. State, 708 So. 2d 899, 909 (Ala.Crim. App.) ("`There is a presumption that every word, sentence, or provision was intended for some useful purpose, has some force and effect, and that some effect is to be given to each, and also that no superfluous words or provisions were used.'") (quoting 82 C.J.S. Statutes § 316 (1953)), cert. denied, 708 So. 2d 911 (Ala.1997); McDonald v. State, 32 Ala. App. 606, 609, 28 So. 2d 805, 807 (1947) ("A legislature will not be presumed to use language without any meaning or application...."). Moreover, even such an unnatural construction would not avoid the conflict between Rule 82(d)(2)(A), which provides for a discretionary transfer upon the motion of "less than all remaining defendants," and the statutory timing sentence, which provides for a mandatory transfer upon the motion of "any defendant."
We decline to engage in the exercise of cutting and pasting both the timing sentence of § 6-5-546 and the provisions of the rules so as to accomplish judicially what the Legislature has time and again accomplished by simply omitting from venue statutes language addressing the timing of challenges to venue. See, e.g., Ala.Code 1975, § 6-3-2 (providing general rules of venue for actions against individuals, but omitting language addressing the timing of challenges to venue); § 6-3-3 (providing for the venue of actions regarding work or labor done, but omitting language addressing the timing of challenges to venue); § 6-3-4 (providing for the venue of actions against unincorporated insurers, but omitting language addressing the timing of challenges to venue); § 6-3-5 (providing for the venue of actions regarding insurance policies, but omitting language addressing the timing of challenges to venue); § 6-3-6 (providing for the venue of actions against unincorporated organizations and associations, but omitting language addressing the timing of challenges to venue); § 6-3-7 (providing for the venue of actions against corporations, but omitting language addressing the timing of challenges to venue). Instead, we construe the timing sentence of § 6-5-546 as it is written, so that both the showing and the motion may be made "at any time prior to the commencement of the trial." This construction allows health care defendants to take full advantage of the new venue rule of § 6-5-546, as long as they move to transfer before trial. This construction is consistent with the Legislature's purpose in passing the 1987 Act to control "the spiraling costs ... of essential medical services caused by the threat of [medical liability] litigation." § 6-5-540.[10]
The Health Care Defendants moved on September 16 and 17, 1997, to transfer for improper venue; this was before the trial commenced. The motions to transfer were also made before the October 1 concession by Howell's counsel that Howell would name no Walker County health care defendants and that there thus was no allegation of an act or *192 omission occurring in Walker County that gave rise to medical liability. Under § 6-5-546, the motions for a transfer were timely.
We conclude that the Health Care Defendants have demonstrated a clear legal right under § 6-5-546 to have the claims against them severed and transferred to Jefferson County, where the alleged acts of malpractice occurred. Therefore, we grant their petitions for the writ of mandamus.
HOOPER, C.J., and MADDOX, J., concur.
ALMON and HOUSTON, JJ., concur specially.
SHORES, KENNEDY, COOK, and LYONS, JJ., concur in the result.
HOUSTON, Justice (concurring specially).
I concur, based upon Ala.Code 1975, § 6-5-546, as interpreted by Ex parte Kennedy, 656 So. 2d 365 (Ala.1995), and Ex parte Father Walter Memorial Child Care Center, 656 So. 2d 369 (Ala.1995). Section 6-5-546, as applied in Kennedy and in this case, requires the plaintiffs to split their cause of action. I think the law of judgments should be modified in these cases based on split causes of action so that if the plaintiffs should obtain judgments in their favor in both trials, the satisfaction of one judgment should merely cause a pro tanto reduction of the other judgment, not pose an absolute bar.
ALMON, J., concurs.
LYONS, Justice (concurring in the result).
These petitions present difficult questions concerning the interplay between a portion of the Medical Liability Act of 1987, § 6-5-540 et seq., Ala.Code 1975 ("the Act"), specifically the portion relating to transfer for improper venue, based on events occurring after the commencement of a medical liability action (§ 6-5-546) and provisions of the Rules of Civil Procedure generally applicable to post-complaint changes giving rise to transfers for improper venue. Pursuant to Rule 81(a)(32), procedural matters specified by a statute that conflict with the rules are controlled by the statute. The question whether the procedures prescribed under the Act conflict with the rules and therefore dictate an inconsistent procedure are at the heart of this case. In close cases, such as this one, I would indulge in a presumption against inconsistency, on the ground that the public is best served by a rule that promotes the greatest uniformity.
In Ex parte Kennedy, 656 So. 2d 365 (Ala. 1995), this Court found the provisions of Rule 82(c) allowing for pendent venue (the rule that venue being good for one, it is good for all) to directly conflict with the Act. However, I do not find an analogous conflict in this case between the rules and § 6-5-546. The statute provides:
I would read the phrase "at any time" to refer to the time of the showing and not as a standard applicable to the timeliness of the required motion.
Fictitious parties can be dropped in two ways. Under Rule 4(f), fictitious parties are dropped when a plaintiff announces ready for trial against other defendants sued by their true names. Under Rule 21, "[p]arties may be dropped ... on motion of any party ... at any stage of the action and on such terms as are just." In the instant case, the Howells were under an obligation to amend "at least 90 days before trial." § 6-5-551, Ala.Code 1975. The statute is silent as to whether the deadline runs from the first trial setting.[11] Under the Act, a continuance of the action would give rise to the running of a new 90-day period for seeking leave to make amendments. In the instant case, as long as the *193 possibility of a continuance existed, there remained the opportunity for the Howells to amend the complaint to substitute parties sued by their true names for fictitious parties.
When the Howells sought leave to serve the fifth amended complaint, they tendered a pleading that continued to make allegations against fictitiously named Walker County health care providers. Under Rule 12(h)(1), the defense of improper venue is waived if it is omitted from a responsive pleading. I do not think that rule has any bearing on this present action, because the improper-venue defense was not available when the responsive pleadings were served, rather than because of a conflict with § 6-5-546, as the main opinion holds. Not until the oral argument on the motions for a transfer based on improper venue did the Howells dismiss the fictitious Walker County defendants. The clock began to run at that time on the Health Care Defendants' right to move for a change of venue.[12]
Rule 82(d)(2)(C)(i) governs the timeliness of a motion to transfer an action based upon improper venue after a plaintiff voluntarily dismisses a party, and that rule specifies that the motion must be served within 30 days of the dismissal, unless the case is less than 30 days away from trial, in which event the motion must be made as soon as practicable.[13] Here, the Health Care Defendants' motions were filed two weeks before the Howells dismissed the fictitious parties. The Health Care Defendants' motions, therefore, were harmlessly premature.
The main opinion, after assuming the validity of the limitation of the phrase "at any time" to modify only the phrase "it is shown" and not the phrase "on motion of any defendant," works through an imaginative and thorough series of hypothetical situations to develop inconsistencies between the timing provision of the statute and provisions of Rule 82(d)(2)(C)(i) not at issue. We are not dealing with the assertion of a motion to transfer made during trial, nor are we faced with a situation where fewer than all defendants seek a transfer, so conflicting provisions in Rule 82(d)(2)(C)(i) and the statute are not before us. Were they at issue, we would weigh the terms of the statute against the rule and make a determination consistent with both the statute and Rules 81 and 82. I am unwilling to back away from what the main opinion calls "the exercise of cutting and pasting both the timing sentence of § 6-5-546 and the provisions of the rules," 721 So. 2d at 191, when it is necessary in order to accomplish judicially that which is our authority and responsibility under Rule 81 and Rule 1.
I concur with the decision of the main opinion to issue the writ of mandamus, but I would not leave the text of the statute vulnerable to a construction that would allow a defendant to sit until the eve of trial on a venue defect created by § 6-5-546.
I also concur with Justice Houston's suggestion in his special concurrence that the law of judgments should be modified in cases, such as this one, in which the plaintiffs are required to split their causes of action.
SHORES, KENNEDY, and COOK, JJ., concur.
[1] Rule 82(c), Ala. R. Civ. P., reads in its entirety:
"Venue Where Claim or Parties Joined. Where several claims or parties have been joined, the suit may be brought in any county in which any one of the claims could properly have been brought. Whenever an action has been commenced in a proper county, additional claims and parties may be joined, pursuant to Rules 13, 14, 22, and 24, as ancillary thereto, without regard to whether that county would be a proper venue for an independent action on such claims or against such parties."
[2] Rule 12(h)(1) provides:
"A defense of lack of jurisdiction over the person, improper venue, insufficiency of process, or insufficiency of service or process is waived (A) if omitted from a motion in the circumstances described in subdivision (g), or (B) if it is neither made by motion under this rule nor included in a responsive pleading or an amendment thereof permitted by Rule 15(a) to be made as a matter of course."
Rule 12(g), Ala. R. Civ. P., provides:
"A party who makes a motion under this rule may join with it any other motions herein provided for and then available to the party. If a party makes a motion under this rule but omits therefrom any defense or objection then available to the party which this rule permits to be raised by motion, the party shall not thereafter make a motion based on the defense or objection so omitted, except a motion as provided in subdivision (h)(2) hereof on any of the grounds there stated."
[3] Before 1987, Rule 82(d)(2)(C)(i) read:
"Voluntary Dismissal. A motion to transfer after voluntary dismissal of a party shall be served as soon as practicable if the action has been set for trial within less than thirty days of the dismissal or if the trial of the action has been commenced and, in all other instances, within thirty days of the dismissal."
Effective September 1, 1987, Rule 82(d)(2)(C)(i) was amended to start the running of the 30-day period from the date of the service of notice of the dismissal of a party, instead of from the date of the order of dismissal. See Rule 82, Ala. R. Civ. P., cmts.
[4] Ala.Code 1975, § 6-3-2, which does not mention the timing of venue challenges, provides in pertinent part:
"(a) In proceedings of a legal nature against individuals:
"....
"(3) All other personal actions, if the defendant or one of the defendants has within the state a permanent residence, may be commenced in the county of such residence or in the county in which the act or omission complained of may have been done or may have occurred."
Ala.Code 1975, § 6-3-6, which does not mention the timing of venue challenges, provides:
"Action against an unincorporated organization or association may be commenced in any county where such organization or association does business or has in existence a branch or local organization." [Footnote cont'd.]
Ala.Code 1975, § 6-3-7, which does not mention the timing of venue challenges, provides:
"A foreign corporation may be sued in any county in which it does business by agent, and a domestic corporation may be sued in any county in which it does business by agent or was doing business by agent at the time the cause of action arose; provided, that all actions against a domestic corporation for personal injuries must be commenced in the county where the injury occurred or in the county where the plaintiff resides if such corporation does business by agent in the county of the plaintiff's residence."
[5] The Legislature specifically addressed timing in Ala.Code 1975, § 6-3-20:
"Either party to a civil action may move the court to change the venue at any time before final trial, making affidavit that for causes set forth, he cannot have a fair and impartial trial in the county where the action is pending. The court may direct a change to the nearest county free from proper objection by either party, to be determined by affidavits and, whenever it will best secure the ends of justice, it may require the applicant to give bond and security for costs. The same party can have the venue changed but once."
(Emphasis added.)
[6] Howell also argues that the Health Care Defendants should have known on August 12, 1997, that he would not name Walker County health care providers as defendants. On that date, Howell supplied the Health Care Defendants with his final disclosure of expert-witness evidence, which indicated no negligence on the part of Walker County health care providers. However, the Health Care Defendants' filing of their motions to transfer, coming barely a month after this disclosure, and still before trial, was sufficiently timely to avoid any argument of an implied waiver of venue.
[7] Rule 82(d)(4), Ala. R. Civ. P., provides that once a defendant moves to transfer venue, only defendants named within 75 days of the filing of the motion will be considered for purposes of determining venue. Howell argues that this rule negates the Health Care Defendants' reliance on the possibility that the fictitious Walker County health care providers would be named as defendants. Specifically, Howell asserts that pursuant to Rule 82(d)(4), the Health Care Defendants could have required him to name any Walker County health care providers at any time. Within 75 days of filing a motion to transfer, the Health Care Defendants would have known if acts of malpractice were alleged in more than one county and thus whether the malpractice claims could not be transferred to Jefferson County. Of course, the plaintiff, who had the most intimate knowledge of what claims he would make and what defendants he would sue, also could have named or excluded any Walker County health care provider defendants at any time. More importantly, Howell's circuitous argument fails because neither the statute nor the rule requires health care providers to force the plaintiff to name all defendants before the commencement of trial.
[8] Rule 82(d)(2)(C)(i), Ala. R. Civ. P., provides:
"Voluntary Dismissal. A motion to transfer after voluntary dismissal of a party shall be served as soon as practicable if the action has been set for trial within less than thirty (30) days of the dismissal or if the trial of the action has commenced; and, in all other instances, within thirty (30) days after the plaintiff serves a notice of the voluntary dismissal on all other parties and files a copy of the notice with the clerk."
[9] Further, construing the phrase "at any time prior to the commencement of the trial" to modify only the showing of improper venue, and not the motion, would effectively render the phrase "at any time" meaningless with respect to Rule 12, Ala. R. Civ. P. Before the 1987 Act, a plaintiff could make a showing of improper venue any time before trial, by dropping a claim. The timing of a defendant's motion was governed by Rule 12(d) and (h)(1). Presuming that the Legislature was aware of pre-1987 law, it would not have included the phrase "at any time" in § 6-5-546 for the purpose of retaining the timing provisions of Rule 12(d) and (h)(1) a result that would have occurred had the phrase been omitted. See Blue Cross & Blue Shield of Alabama, Inc., v. Nielsen, 714 So. 2d 293 (Ala. 1998) ("It is a familiar principle of statutory interpretation that the Legislature, in enacting new legislation, is presumed to know the existing law."); McDonald v. State, 32 Ala.App. 606, 609, 28 So. 2d 805, 807 (1947) ("A legislature will not be presumed to use language without any meaning or application....").
[10] Of course, the right to challenge venue, even under § 6-5-546, may be waived. See Jordan v. Guaranty Pest Control, Inc., 292 Ala. 601, 605-06, 298 So. 2d 244, 248 (Ala. 1974) (distinguishing venue, which may be waived, from subject matter jurisdiction). On a party's motion or on its own motion, the trial court may schedule a hearing on a § 6-5-546 venue matter. After granting appropriate continuances to resolve factual disputes, the trial court can rule on the applicability of a transfer for improper venue. If a defendant does not seek a writ of mandamus in a timely manner, he will have waived any further challenges to venue. See Ex parte Swift Loan & Finance Co., 667 So. 2d 706, 708 (Ala. 1995) (stating that a mandamus petition is the proper method for challenging a venue ruling); Medical Service Administration v. Dickerson, 362 So. 2d 906 (Ala. 1978) (holding that a writ of mandamus is the proper relief for an improper transfer based on venue); Evans v. Insurance Co. of North America, 349 So. 2d 1099, 1101 (Ala. 1977) (stating that a petition for the writ of mandamus will be held untimely upon a showing of unreasonable delay and prejudice).
[11] Compare Rule 15(a), allowing amendments without leave of court as long as they are made more than 42 days before the "first setting of the case for trial."
[12] Rule 82(d)(4) states: "No defendant still designated as a fictitious party pursuant to Rule 9(h) 75 days after the filing of a motion to transfer shall be considered for the purpose of deciding the correct venue of the action." When a defendant moves to transfer, the plaintiff must act within 75 days to amend the pleadings to substitute the true name of any defendant who remains designated as a fictitious party. I agree with the main opinion in the conclusion that this time limit does not impose a duty on a defendant to file a motion that might force the joinder of another defendant. But, as long as the defendant delays in filing such a motion, the plaintiff may still amend so as to substitute a party sued by its correct name for a fictitious party, and such an amendment would relate back for purposes of determining proper venue. Ex parte Smith, 423 So. 2d 844 (Ala. 1982).
[13] Although the waiver provision in Rule 12(h)(1) does not apply in this case, Rule 82(d) contains its own waiver provision. If the Health Care Defendants had not served their motion to transfer within 30 days of the Howells' dismissal of the fictitious Walker County defendants, then their defense of improper venue would have been waived. Rule 82(d)(2)(C)(iii). | f8467963d8a7ce38c239ebcdc62c1809618b54369d161fb2e7041a3109c98d76 | 1998-08-28 00:00:00 |
939f8ad4-0835-4d2d-bdb8-e8746dea2412 | EX PARTE McCARTNEY CONSTRUCTION COMPANY | 720 So. 2d 910 | 1970686 | Alabama | Alabama Supreme Court | 720 So. 2d 910 (1998)
Ex parte McCARTNEY CONSTRUCTION COMPANY.
(Re Maurice Dwight TIMMONS v. McCARTNEY CONSTRUCTION COMPANY et al.)
1970686.
Supreme Court of Alabama.
August 7, 1998.
Jack W. Torbert of Torbert & Torbert, P.A., Gadsden, for petitioner.
Daniel B. King of King, King & King, P.C., Gadsden, for respondent.
COOK, Justice.
McCartney Construction Company ("McCartney"), a defendant in an action pending in the Etowah Circuit Court, petitions for a writ of mandamus directing that court to vacate its order denying McCartney's motion to dismiss, and to dismiss McCartney as a defendant. We grant the petition.
Maurice Dwight Timmons, the plaintiff in the pending action, is an employee of McCartney. He suffered an on-the-job injury. The documents filed with this Court indicate that Timmons is covered by the provisions of the Workers' Compensation Act, Ala.Code 1975, § 25-5-1 et seq. Timmons sued McCartney and a co-employee for damages based on his injury, alleging that they had intentionally and willfully failed to provide him with a safe workplace, in violation of § 25-1-1.
McCartney moved to dismiss the complaint on the ground that it was entitled to immunity pursuant to §§ 25-5-52 and 25-5-53 (the "exclusive remedy" provisions of the Workers' Compensation Act). The trial court denied the motion to dismiss, holding that, because Timmons alleged intentional and willful misconduct on the part of the defendants, McCartney was not entitled to immunity.
The immunity provided employers by the Workers' Compensation Act is found at § 25-5-52 and at § 25-5-53:
Section 25-5-11 authorizes the injured employee to bring an action against "any party other than the employer" who is also legally responsible for the injury, and provides:
In Murdock v. Steel Processing Services, Inc., 581 So. 2d 846, 848 (Ala.1991), this Court held:
And, in Padgett v. Neptune Water Meter Co., 585 So. 2d 900, 901 (Ala.1991), we held:
See, also, Powell v. United States Fidelity & Guaranty Co., 646 So. 2d 637 (Ala.1994).
McCartney is entitled to the relief it seeks; therefore, the petition for the writ of mandamus is granted.
PETITION GRANTED.
HOOPER, C.J., and MADDOX, HOUSTON, KENNEDY, SEE, and LYONS, JJ., concur. | 59cee21859f02713189cc55afc5e2fff45291784ccd552b3edc0002168556b67 | 1998-08-07 00:00:00 |
008fc0fb-8f34-420a-a292-fbc276b6633d | Ex Parte Nat. SEC. Ins. Co. | 727 So. 2d 788 | 1970718 | Alabama | Alabama Supreme Court | 727 So. 2d 788 (1998)
Ex parte NATIONAL SECURITY INSURANCE COMPANY
(Re Louise Smoke v. National Security Insurance Company, et al.)
1970718.
Supreme Court of Alabama.
October 23, 1998.
Rehearing Denied February 12, 1999.
Richard A. Ball, Jr., and Joana S. Ellis of Ball, Ball, Matthews & Novak, Montgomery, for petitioner.
Paul C. Williams, Tyrone C. Means, and James L. Richey of Thomas, Means & Gillis, P.C., Montgomery, for respondents Louise Smoke and Judge H. Edward McFerrin.
SEE, Justice.
This petition for the writ of mandamus arises from the trial court's denial of a motion to transfer an action pursuant to § 6-3-21.1, Ala.Code 1975, the forum non conveniens statute. National Security Insurance *789 Company ("National Security"), the defendant in an action pending in the Lowndes Circuit Court, petitions for a writ directing the circuit court to vacate its order denying the motion to transfer the cause to the Elmore Circuit Court. Because the facts of this case clearly show that National Security is entitled to the relief authorized by the Legislature under the forum non conveniens statute, we grant the petition.
Louise Smoke, a resident of Elmore County, sued National Security in connection with one life insurance policy and two accident and health insurance policies that she had applied for and purchased in Elmore County. Smoke claims that she was charged, and paid, premiums on these policies during periods in which the policies were not in effect. The premiums were collected in Elmore County by various home service agents of National Security.
Smoke filed her complaint in the Lowndes Circuit Court in March 1997, alleging, among other things, breach of contract and fraud. National Security filed motions to dismiss or to transfer the action to the Elmore Circuit Court, based on improper venue and on the doctrine of forum non conveniens. The trial court denied the motions, holding that venue was proper in Lowndes County and that National Security had failed to meet its burden for invoking the doctrine of forum non conveniens.
The proper method for obtaining review of a denial of a motion for a change of venue in a civil action is to petition for the writ of mandamus. Lawler Mobile Homes, Inc. v. Tarver, 492 So. 2d 297, 302 (Ala.1986). "Mandamus is a drastic and extraordinary writ, to be issued only where there is (1) a clear legal right in the petitioner to the order sought; (2) an imperative duty upon the respondent to perform, accompanied by a refusal to do so; (3) the lack of another adequate remedy; and (4) properly invoked jurisdiction of the court." Ex parte Integon Corp., 672 So. 2d 497, 499 (Ala.1995). "When we consider a mandamus petition relating to a venue ruling, our scope of review is to determine if the trial court abused its discretion, i.e., whether it exercised its discretion in an arbitrary and capricious manner." Id. Our review is further limited to those facts that were before the trial court. Ex parte American Resources Ins. Co., 663 So. 2d 932, 936 (Ala.1995).
In 1987, the Legislature enacted § 6-3-21.1(a), Ala.Code 1975, and adopted the doctrine of forum non conveniens. Section 6-3-21.1(a) states in pertinent part:
(Emphasis added.) A defendant moving for a transfer under § 6-3-21.1 has the initial burden of showing that the transfer is justified, based on the convenience of the parties and witnesses or based on the interest of justice. See generally Ex parte First Family Fin. Services, Inc., 718 So. 2d 658 (Ala. 1998) (quoting Ex parte Gauntt, 677 So. 2d 204, 221 (Ala.1996) (Maddox, J., dissenting)).
This Court's recent decisions in First Family and Ex parte Independent Life & Accident Ins. Co., 725 So. 2d 955 (Ala.1998), regarding the doctrine of forum non conveniens, are controlling in this case. In First Family, 718 So. 2d at 662, the plaintiff filed the action in the Marengo Circuit Court and the defendant moved for a transfer to the Dallas Circuit Court. This Court stated:
718 So. 2d at 662. Under those circumstances, this Court held that the "interest of justice" required the transfer of the action from a county with little, if any, connection to the action, to the county with a strong connection to the action. 718 So. 2d at 662.
It is undisputed that at the time of filing National Security maintained no office, and kept no documents, in Lowndes County. Smoke did not live in Lowndes County. No meetings between National Security and Smoke occurred in Lowndes County. In fact, all meetings between Smoke and employees of National Security occurred in Elmore County, where National Security seeks to have the case transferred. Further, Smoke was treated in Elmore County for her alleged mental anguish arising from her dealings with National Security. All of Smoke's witnesses reside in Elmore County, and no witness for either party resides in Lowndes County. Under these circumstances, the "interest of justice" requires the transfer of the action from a county with little, if any, connection to the action, Lowndes County, to the county with a strong connection to the action, Elmore County.
Notwithstanding these facts, Smoke argues that the close geographical proximity of Lowndes County and Elmore County precludes a showing of the significant benefit of convenience that she argues is necessary before a transfer under § 6-3-21.1 is warranted. This argument ignores the words "interest of justice" as a basis for transferring an action. This language was included by the Legislature in § 6-3-21.1 and has been interpreted by this Court to require a transfer even between contiguous counties. In Independent Life, 725 So. 2d at 957, this Court required the transfer from Lowndes County to Montgomery County of an action involving breach-of-contract and fraud allegations against an insurer. Although Lowndes County and Montgomery County are contiguous, this Court noted that the plaintiffs lived in Montgomery County, that all relevant transactions took place in Montgomery County, and that most of the witnesses lived in Montgomery County. 725 So. 2d at 957. This Court concluded that the action had "no nexus with Lowndes County that would justify burdening that county with the trial of [that] case." 725 So. 2d at 957. This Court then relied on First Family, 718 So. 2d at 662, and, thus, the "interest of justice" factor of § 6-3-21.1, to require a transfer from Lowndes County to contiguous Montgomery County. Independent Life, 725 So. 2d at 957.
Similarly, in this case, there is no witness, no document, no transaction, or anything else that would give the action a nexus with Lowndes County that would justify burdening that county with the trial of the case. Based on First Family and Independent Life, and their interpretation of § 6-3-21.1, we hold that the trial court abused its discretion in denying the motion to transfer this case from Lowndes County to Elmore County.[1]
Accordingly, the Lowndes Circuit Court is directed to vacate its order of December 2, 1997, denying National Security's motion to transfer. The Lowndes Circuit Court is further directed to transfer the pending action to the Elmore Circuit Court.
WRIT GRANTED.
HOOPER, C.J., and MADDOX, HOUSTON, KENNEDY, and LYONS, JJ., concur.
ALMON, SHORES, and COOK, JJ., dissent.
SHORES, Justice, dissenting.
I again express my view that this Court reads the forum non conveniens statute (§ 6-3-21.1, Ala.Code 1975) too broadly. I do not believe that in enacting that statute the legislature intended to deprive a plaintiff of the traditional right to choose any appropriate venue to file his or her action. I believe the legislature intended to permit a trial court, in its discretion, to transfer a case *791 (even though filed in a proper venue) to another county only if the defendant produces evidence indicating that justice requires nullifying the plaintiffs choice of forum. By its construction of this statute in this and in other cases, a majority of this Court mandates that the trial court transfer a case merely on the motion of a defendant. I dissent.
ALMON, J., concurs.
COOK, Justice, dissenting.
I respectfully dissent. The reasons for my dissent are the same as those expressed in my dissents in Ex parte Independent Life & Accident Insurance Co., 725 So. 2d 955 (Ala. 1998); and Ex parte First Family Financial Services, Inc., 718 So. 2d 658 (Ala.1998).
[1] Because we conclude that § 6-3-21.1, Ala. Code 1975, requires a transfer to Elmore County, we pretermit discussion of the application of §§ 6-3-5 and 6-3-7. | 947e2124d67c85946f78aceb25db5b4b6580b24d9e018044ec968b02e984c7ac | 1998-10-23 00:00:00 |
053edd27-f51c-4c2c-9d4d-050c0cf861d3 | Ex Parte Taylor | 728 So. 2d 635 | 1970008 | Alabama | Alabama Supreme Court | 728 So. 2d 635 (1998)
Ex parte Betty Jean TAYLOR and J.D. Davis.
(Re Scott Paper Company v. Betty Jean Taylor and Scott Paper Company v. J.D. Davis).
1970008.
Supreme Court of Alabama.
October 23, 1998.
Rehearing Denied December 11, 1998.
*636 John Gibbons and William H. Reece of Gardner, Middlebrooks, Fleming & Gibbons, P.C., Mobile, for petitioners.
Scott G. Brown of Armbrecht, Jackson, DeMouy, Crow, Holmes & Reeves, L.L.C., Mobile, for respondent.
COOK, Justice.
We granted Betty Jean Taylor and J.D. Davis's petition for the writ of certiorari to review the judgment of the Court of Civil Appeals reversing the trial court's judgment awarding them workers' compensation benefits pursuant to the scheduled-injury provision, Ala.Code 1975, § 25-5-57(a)(3)a.18. See Scott Paper Co. v. Taylor, 728 So. 2d 632 (Ala.Civ.App.1997). We reverse and remand.
On May 25, 1994, J.D. Davis sued Scott Paper Company for workers' compensation benefits based on hearing loss suffered after long-term exposure to harmful levels of noise during his employment with Scott Paper Company. On June 24, 1994, Betty Jean Taylor sued Scott Paper Company for workers' compensation based on hearing loss suffered while she was employed by Scott Paper Company. On October 17, 1995, the trial court awarded workers' compensation and medical benefits to Taylor, finding that she had suffered a 24.4% permanent partial disability. On October 26, 1995, the trial court awarded Davis workers' compensation benefits and medical benefits, finding that he had suffered an 11.9% permanent partial disability. Scott Paper appealed both awards. Davis and Taylor moved to have their cases consolidated, and the Court of Civil Appeals granted their motion. The Court of Civil Appeals reversed the judgments and remanded the cases with instructions, holding that Scott Paper could reduce the workers' compensation awards by the amount of the benefits Davis and Taylor received under the company-provided retirement plan.
The issue is whether Scott Paper Company is entitled to reduce the amount of workers' compensation benefits paid to Taylor and Davis by the amount of retirement benefits paid to them, pursuant to Ala.Code 1975, § 25-5-57(c)(1). More specifically, the issue is whether the legislature intended for normal retirement benefits to be set off against workers' compensation benefits. We hold that § 25-5-57(c)(1) does not allow an employer to set off, against workers' compensation benefits, the amount of benefits the worker received from a retirement plan that are unrelated to a job-related injury or compensation therefor.
Section 25-5-57(c)(1) states:
Scott Paper contends that § 25-5-57(c)(1) allows it to deduct Taylor and Davis's retirement payments from their workers' compensation payments, arguing that the statutory phrase "providing for sick pay" does not modify "retirement plan" and, therefore, that all company-provided retirement benefits reduce a workers' compensation award. However, the employees contend that § 25-5-57(c)(1) does not allow employers to set off retirement plan payments against workers' compensation benefits; they argue that the phrase "providing for sick pay" modifies "retirement plan" as well as "other plan" and, therefore, that the set-off applies only to retirement plans that provide for some form of sick pay. We agree.
The basic rule of statutory interpretation is to determine and give effect to the intent of the legislature as manifested in the language of the statute. See Ex parte State Department of Revenue, 683 So. 2d 980, 982 (Ala.1996). The principle of noscitur a sociis as a rule of construction is particularly relevant. "[W]here general and specific words which are capable of an analogous meaning are associated one with the other, they take color from each other, so that the general words are restricted to a sense analogous to that of the less general." Winner v. *637 Marion County Comm'n, 415 So. 2d 1061, 1064 (Ala.1982). Thus, we conclude that the more specific phrase "other plan providing for sick pay" qualified the two preceding phrases "disability plan" and "retirement plan."
In Ex parte Dunlop Tire Corp., 706 So. 2d 729, 733 (Ala.1997), we discussed the importance of a court's ascertaining legislative intent when interpreting a statute:
When it amended the Workers' Compensation Act in 1992, by Act No. 92-537, Ala. Acts 1992, the legislature announced its intent, in § 1 of that Act:
(Emphasis added.)
We do not agree that the Court of Civil Appeals' interpretation of § 25-5-57(c)(1) is the result intended by the legislature. It is clear from § 1 of Act No. 92-537, that the legislature's intent behind the amendment of the Workers' Compensation Act was to prevent "double recovery," such as payments from a disability plan or sick plan that a worker might receive as a result of an injury in addition to workers' compensation benefits. Although § 25-5-57(c)(1) names "retirement plan" as one of the plans from which benefits would be set off against workers' compensation benefits, we conclude that a plan providing for disability benefits, such as the plan involved in Ex parte Dunlop Tire Corp., supra, would be more in line with the intent of the statute than would a normal retirement plan such as the one involved in this case.
In Ex parte Dunlop Tire Corp., supra, we interpreted § 25-5-57(c)(1) as allowing an employer to set off disability-plan benefits against awards of workers' compensation. These present cases are readily distinguishable from Dunlop in that the issue in Dunlop was whether to set off benefits received from a medical disability plan, based on a jobrelated injury, against workers' compensation benefits. In Dunlop, receiving benefits *638 under the disability plan and receiving workers' compensation benefits would have constituted a double recovery from the employer. Therefore, we held that the employer was entitled to a set-off of benefits. Id. at 735.
The retirement plan in these present cases is a "normal retirement plan" and is independent of any plan providing for sick pay or any plan providing for disability benefits. The retirement benefits provided by Scott Paper Company are based solely upon the age of an employee and the length of service rendered by an employee to Scott Paper Company. We conclude that the legislature did not intend that benefits from the "normal retirement plan" in these present cases be set off against workers' compensation benefits. We hold that § 25-5-57(c)(1) allows benefits to be set off against workers' compensation benefits if the plan whose benefits are to be set off has additional benefits based on the injury, e.g., sick pay.
The petitioners Taylor and Davis are retired employees of Scott Paper Company. As such, they are to receive retirement benefits provided by Scott Paper based upon the number of years they were employed by Scott Paper. It is not reasonable to think the legislature intended that an employee, such as Taylor or Davis, who happens to be injured on the job should receive reduced workers' compensation benefits because of the retirement planretirement pay is a benefit these employees would have received regardless of the occurrence of an on-the-job injury.
We reverse the judgment of the Court of Civil Appeals and remand these cases for the entry of a judgment consistent with this opinion.
REVERSED AND REMANDED.
ALMON, SHORES, KENNEDY, SEE, and LYONS, JJ., concur.
HOOPER, C.J., and MADDOX and HOUSTON, JJ., dissent. | 123e26c2bd9661f216b2fedc92e06a7f81412394d7d2aafc367c3a78352b89da | 1998-10-23 00:00:00 |
20976a65-927c-47a6-afc5-68d7d2f35177 | In Re Anonymous | 720 So. 2d 497 | 1971860 | Alabama | Alabama Supreme Court | 720 So. 2d 497 (1998)
In re ANONYMOUS, a minor.
(In re In the Matter of ANONYMOUS, a minor).
1971860.
Supreme Court of Alabama.
August 3, 1998.
*498 PER CURIAM.
This case involves an order of a trial court granting a 17-year-old minor's petition for a waiver of parental consent to have an abortion, pursuant to the provisions of §§ 26-21-1 to -8, Ala.Code 1975 (commonly referred to as "Parental Consent Statute"). The trial court appointed a guardian ad litem to represent the interests of the fetus at the hearing of the case; the guardian appealed to the Court of Civil Appeals, seeking review of the trial court's decision.
The Court of Civil Appeals held that the guardian ad litem had no statutory right to appeal the trial court's order, in that the right to appeal was limited to cases in which a minor's request to have an abortion without obtaining parental consent had been denied. The Court of Civil Appeals dismissed the appeal. In the Matter of Anonymous, 720 So. 2d 497 (Ala.Civ.App.1998). The guardian ad litem timely petitioned this Court to review the judgment of the Court of Civil Appeal dismissing the appeal; a complete record of the proceeding was filed in this Court, and the parties have briefed the issues raised.[1]
After considering the opinion of the Court of Civil Appeals, the petitioner's brief; the briefs filed by the guardian ad litem appointed for the minor; and the brief filed by the attorney general, we affirm the judgment of the Court of Civil Appeals dismissing the appeal and holding that the guardian ad litem could not seek a review of the trial court's order.
For a better understanding of the reasons why we hold that the Court of Civil Appeals properly dismissed the guardian ad litem's appeal, we set out the basic facts involved in *499 this case. On July 6, 1998, a minor, age 17, and seven- to nine-weeks pregnant, sought an order from the trial court authorizing her to obtain an abortion without getting parental consent. Relying on Rule 17(c) of the Alabama Rules of Civil Procedure,[2] the trial court appointed a guardian ad litem to represent the interests of the fetus. The trial court also appointed a guardian ad litem to represent the interests of the minor. After conducting a hearing, at which evidence was presented both by the minor, acting by and through her guardian ad litem, and by the guardian ad litem appointed to represent the fetus, the trial court granted the waiver of parental consent.
The guardian ad litem appointed to represent the fetus appealed to the Court of Civil Appeals. That court, after citing and quoting § 26-21-4(h), Ala.Code 1975,[3] held that "[b]ecause the right of appeal is purely statutory, strict compliance with the statute authorizing the appeal is required." 720 So. 2d at 497. That court concluded, in part, as follows:
720 So. 2d at 497 (emphasis original).
The guardian ad litem for the fetus, within three days after the entry of that order, petitioned this Court to review that decision, and the complete record was subsequently filed. The guardian has raised three legal issues:
Pet. brief at 1-2. Because this petition raised a question whether the Parental Consent Statute was constitutional, the guardian served proper notice on the attorney general.
We granted the petition for the writ of certiorari, and we first consider whether the Court of Civil Appeals erred in dismissing the appeal. Having reviewed the briefs submitted by the parties, we affirm the judgment of the Court of Civil Appeals.
Based upon well-established Alabama caselaw, reaffirmed by this Court on July 31, 1998, we must presume that in 1987, when it enacted Ala.Code 1975, § 26-21-1 et seq. (the Parental Consent Statute), the Alabama Legislature knew the limit of its constitutional authority. See Abbott Laboratories v. Durrett, [Ms. 1960464, July 31, 1998], ___ So.2d ___ (Ala.1998), citing Siegelman v. Chase Manhattan Bank (USA), N.A., 575 So. 2d 1041 (Ala.1991); Ex parte Dixie Tool & Die Co., 537 So. 2d 923 (Ala.1988); Ex parte Louisville & N.R.R., 398 So. 2d 291 (Ala.1981); and Ellis v. Pope, 709 So. 2d 1161 (Ala.1997). The Legislature, as the Court of Civil Appeals correctly noted, did not provide a right to appeal from an order granting a petition for a waiver of parental consent. We can conclude only that the Legislature understood its subordinance to the Supremacy *500 Clause of the United States Constitution and that it recognized that, pursuant to the United States Supreme Court's decision in Roe v. Wade, 410 U.S. 113, 93 S. Ct. 705, 35 L. Ed. 2d 147 (1973), it could not constitutionally confer upon a nonviable fetus the right to appeal, through a guardian ad litem, an order granting a minor's request to have an abortion. See, also, Planned Parenthood of Central Missouri v. Danforth, 428 U.S. 52, 96 S. Ct. 2831, 49 L. Ed. 2d 788 (1976); Bellotti v. Baird, 443 U.S. 622, 99 S. Ct. 3035, 61 L. Ed. 2d 797 (1979); City of Akron v. Akron Center for Reproductive Health, Inc., 462 U.S. 416, 103 S. Ct. 2481, 76 L. Ed. 2d 687 (1983), overruled, Planned Parenthood of Southeastern Pennsylvania v. Casey, 505 U.S. 833, 112 S. Ct. 2791, 120 L. Ed. 2d 674 (1992); Planned Parenthood Ass'n of Kansas City, Mo., Inc. v. Ashcroft, 462 U.S. 476, 103 S. Ct. 2517, 76 L. Ed. 2d 733 (1983). (Each of these decisions dealt with the matter of parental consent for a minor seeking an abortion and predated the adoption of the 1987 Parental Consent Statute.)
We now address the guardian ad litem's argument that § 26-21-4, Ala.Code 1975, unconstitutionally deprives custodial parents of due process of law by permitting a court to take away, without any notice, the custodial parents' right to rear their minor child. Although we recognize that the Legislature specifically stated that in enacting the statute it was intending to foster "the family structure," to preserve the family "as a viable social unit," and to protect "the rights of parents to rear children who are members of their household," § 26-21-1(a), we do not believe the statute unconstitutionally denies custodial parents due process of law. See Alabama State Federation of Labor v. McAdory, 246 Ala. 1, 9-10, 18 So. 2d 810, 814-15 (1944), cert. dismissed, 325 U.S. 450, 65 S. Ct. 1384, 89 L. Ed. 1725 (1945).
We last address the ultimate question whether the trial court erred in granting the minor's request for a waiver of parental consent.
The record shows that the trial judge conducted an adversarial hearing and gave both the guardian ad litem appointed for the minor and the guardian ad litem appointed for the fetus the opportunity to present evidence and to argue their respective positions. Based on our reading of that record, and considering the law that the trial judge and this Court must apply, we conclude that the guardian ad litem has not shown that the trial court erred; therefore, the judgment of the trial court is due to be affirmed.
AFFIRMED.
ALMON, SHORES, HOUSTON, and KENNEDY, JJ., concur.
COOK, J., concurs in the result.
HOOPER, C.J., and MADDOX, SEE, and LYONS, JJ., concur specially in part and dissent in part.
HOOPER, Chief Justice, and MADDOX, SEE, and LYONS, Justices (concurring specially in part and dissenting in part).
The per curiam opinion, after granting the petition for certiorari review, holds that the Court of Civil Appeals properly dismissed the appeal filed by the guardian ad litem appointed to represent the unborn child. We disagree with that holding. We address not only that issue but each of the issues presented to this Court by the parties, including whether the trial court erred in appointing a guardian ad litem to represent the unborn child.
We first address the question whether the trial court had the authority to appoint a guardian ad litem for the unborn child.
The Court of Civil Appeals, in dismissing the appeal, determined that the guardian ad litem appointed to represent the unborn child, even if the appointment of that guardian was authorized, could not appeal. The Court of Civil Appeals did not address the issue whether the trial court could appoint a guardian ad litem for the unborn child, but based its judgment solely upon its interpretation of the Parental Consent Statute: that *501 the Legislature had granted the right of appeal only to a minor who has been denied a waiver of the requirement of parental consent. We cannot agree with the Court of Civil Appeals' narrow interpretation of its appellate jurisdiction. We recognize that the present proceedings are largely controlled by the Parental Consent Statute, which was adopted to recognize in the State a compelling interest in regard to the protection of immature minors who lack the ability to make fully informed choices about abortion, and we also recognize that the Parental Consent Statute provides no specific authorization for the trial court to appoint a guardian ad litem for an unborn child. Nevertheless, we believe that the provisions of Rule 17(c), Ala.R.Civ.P., especially when construed in the manner prescribed by Rule 1, authorized the trial judge to make the appointment. Accord §§ 12-12-11 and -34, Ala.Code 1975. The fact that an unborn child has many legal rights is of ancient origin.[4]
Rule 17(c) has historically been applied to protect property interests of those yet unborn, and very often those not yet conceived, and it is applicable in divorce proceedings. See Ex parte Martin, 565 So. 2d 1 (Ala.1989), recognizing the necessity for the appointment of a guardian ad litem for an unborn child of a pregnant woman in statutory proceedings governing a divorce that could lead to a determination that the unborn child was illegitimate. In Martin, this Court held that § 30-2-12, Ala.Code 1975, providing that a divorce granted on the basis that at the time of the marriage the wife was pregnant by a man other than the husband bastardized the child, was unconstitutional when applied to hold the later-born child illegitimate, unless the unborn child was represented by a guardian ad litem in the divorce proceeding. Id. at 4. In Martin, Justice Adams, joined by seven Justices, with one Justice not voting, wrote:
565 So. 2d at 4 (emphasis original).
If a guardian ad litem is required for an unborn child when its legitimacy is at stake, then, a fortiori, it would appear that the appointment of a guardian ad litem, although not specifically provided for in the Parental Consent Statute, would be at least authorized, if not required, in a case such as this one, involving a minor who is seeking a waiver of parental consent to have an abortion.[5]
It is well settled that a guardian ad litem appointed to protect the interests of the unborn has a right to appeal. See, e.g., Motley v. Calhoun, 521 So. 2d 28 (Ala.1988). Although the general rule is that, in proceedings based upon a statutory remedy, the statute governs matters of procedure, an exception applies when the statute is silent, as the Parental Consent Statute is. In that event the Rules of Civil procedure fill the void, pursuant to Rule 81(a)(32). Peseau v. Civil Service Bd. of Tuscaloosa County, 401 So. 2d 79 (Ala.Civ.App.), cert. denied, 401 So. 2d 82 (Ala.1981).
In considering the issues presented in this case, we find it very helpful to look to the intent of the Legislature in adopting the Parental Consent Statute. The legislative intent and purpose are stated in § 26-21-1:
In view of this stated legislative intent and purpose, it seems clear that the Legislature intended, in adopting the Parental Consent Statute, to preserve the life of the unborn, and that it deliberately was doing what it could within the constraints of the Federal Constitution, as interpreted by the Supreme *503 Court of the United States, to accomplish that purpose.
To accomplish its goals of protecting the life of the unborn, the Legislature required the appointment of a guardian ad litem for a minor who seeks a waiver of parental consent, and, although the statute does not specifically require the appointment of a guardian ad litem for the unborn child, it appears to us that this Court, in the Martin case, involving substantially similar questions regarding the rights of an unborn child, not only authorized the appointment of a guardian ad litem for the unborn child but stated that it was necessary to guarantee due process of law. The general rule of law is that guardians ad litem are desirable in many proceedings to ensure that the proceedings will have the adversariness necessary for the full presentation of the issues, and in the proceedings now here for review such an appointment would be consistent with the purpose and intent of the Legislature in adopting the Parental Consent Statute. In another setting, several years ago, this Court addressed the value and necessity for adversariness in judicial proceedings, holding that when a court has before it no "adversary parties," it can issue no judgment or decree. Dickinson v. Jordan, 210 Ala. 602, 98 So. 886 (1924).
We now consider whether a guardian ad litem appointed for the unborn child can appeal a trial judge's order granting a minor a waiver of parental consent. The answer to this admittedly close question of procedure depends on whether § 26-21-4(h), providing a right of appeal to any minor to whom the court denies a waiver of parental consent, was intended to prohibit any other party to a proceeding under the Parental Consent Statute, such as a guardian ad litem, from seeking a review of an order granting a waiver of parental consent. The Court of Civil Appeals held that it was. We think otherwise.
This Court has applied the maxim expressio unius est exclusio alterius "as an aid to construction" in cases in which, "in the natural association of ideas, that which is expressed is so set over by way of contrast to that which is omitted that the contrast enforces the affirmative inference that that which is omitted must be intended to have opposite and contrary treatment." Weill v. State ex rel. Gaillard, 250 Ala. 328, 334, 34 So. 2d 132, 137 (1948). However, Rule 81(a)(32) requires the application of a different standard construing omissions from statutes. See, State v. Washburn, 349 So. 2d 20, 22 (Ala.1977), dealing with impeachment proceedings governed by statutes. The applicable statutes dealt with the testimony of witnesses in such proceedings by stating only that witnesses were "entitled to the same fees ... as witnesses in civil cases"; the statutes were "otherwise silent regarding discovery procedures." 349 So. 2d at 22. Therefore, this Court held, Rule 81 "supplies otherwise nonexistent procedures for the conduct of [the] proceedings" and makes applicable the Rules of Civil Procedure, including the rules for discovery. Id.
Based on the foregoing, we conclude that the Legislature, when it provided the minor a right to appeal, did not intend to prohibit a guardian ad litem appointed to represent the interest of an unborn child from appealing from an adverse order.[6] Stated differently, we do not believe that the Legislature, by failing specifically to provide in the Parental Consent Statute for a guardian ad litem's right to appeal, intended, by omission, to defeat such a right of appeal.
The per curiam opinion addresses the argument made by the guardian ad litem on behalf of the unborn child that § 26-21-4, Ala.Code 1975, unconstitutionally deprives custodial parents of due process of law by permitting a court to take away, without notice, the custodial parents' right to rear their minor child, and concludes that the Parental Consent Statute does not unconstitutionally deny the custodial parents due process of law. We concur with that holding. See Alabama State Federation of Labor v. McAdory, 246 Ala. 1, 9-10, 18 So. 2d 810, *504 814-15 (1944), cert. dismissed, 325 U.S. 450, 65 S. Ct. 1384, 89 L. Ed. 1725 (1945).
We now address the question whether the trial court erred in granting the minor's request for a waiver of parental consent.
We agree with the per curiam opinion that the trial judge conducted an adversarial hearing and gave both the guardian ad litem appointed for the minor and the guardian ad litem appointed for the unborn child the opportunity to present evidence and to argue their respective positions. Based on our reading of that record, and considering the law that the trial judge and this Court must apply, we agree with the per curiam opinion that the guardian ad litem has not shown the judgment of the trial court is erroneous; therefore, the judgment of the trial court is due to be affirmed.
We do note that the trial judge, although stating in his order that he "[did] not condone abortion," felt that he was nevertheless "confined to the issue of waiver of parental consent pursuant to § 26-21-4." He, therefore, granted the waiver.
We would further note that we have reviewed the record, and we find that the guardian ad litem for the unborn child, on very short notice, quite effectively presented substantial evidence that would weigh against a decision to terminate a pregnancy simply for the convenience of the mother. Likewise, the guardian ad litem strenuously argued in the trial court, and argues here, that the trial judge should not have granted the minor's request for a waiver of parental consent.
The issues presented in this case are the subject of debate across this State and across the Nation, and the fact that we agree with the per curiam opinion that the trial court did not err in granting the waiver should not be construed or understood as expressing our personal views on whether abortion is right or wrong, whether the decisions of the United States Supreme Court that govern us in this area are sound, or whether those decisions will be modified or overruled in the future. We would also hasten to add that nothing in the per curiam decision or in our special writing would prevent the minor, whom the trial judge has determined to be mature, from changing her mind and allowing some parental involvement, which, the Legislature has found, "is usually desirable and in the best interests of the minor."
[1] See § 26-21-4(h), Ala.Code 1975, and the Temporary Rules Governing Procedures for Petitions by an Unemancipated Minor Requesting Waiver of Parental Consent for the Performance of an Abortion. Those Rules provide, in part, that "[t]he Supreme Court shall have five days [computed pursuant to Rule 6(a), Alabama Rules of Civil Procedure,] from the filing of the completed record on appeal from the Court of Civil Appeals, the filing of the petition for review, or oral argument, whichever is later, to render and file a written order or issue an opinion." Rule 15. The guardian ad litem's petition was filed in this Court on July 24, 1998, and the completed record was filed in this Court on July 27.
[2] Rule 17(c) provides that "[w]hen the interest of an infant unborn or unconceived is before the court, the court may appoint a guardian ad litem for such interest."
[3] Section 26-21-4(h) provides that "[a]n expedited confidential and anonymous appeal shall be available to any minor to whom the court denies a waiver of consent."
[4] "An infant ... in the mother's womb, is supposed in law to be born for many purposes. It is capable of having a legacy ... [i]t may have a guardian assigned to it, and it is enabled to have an estate limited to its use...." 1 W. Blackstone, Commentaries *130.
More recently, some courts and commentators have determined that it is inappropriate to appoint a guardian ad litem to represent the interests of the unborn child when the pregnant woman is seeking to have an abortion. However, as one commentator on the question notes, as a result of recent medical and scientific advances, physicians and courts have recognized in other contexts that an unborn child has identifiable interests and that those interests may be adverse to the interests of the pregnant woman, and some courts have approved the appointment of guardians ad litem in other contexts. See, e.g., Susan Goldberg, Of Gametes and Guardians: The Impropriety of Appointing Guardians Ad Litem for Fetuses and Embryos, 66 Wash. L.Rev. 503 (1991), for a discussion of these developments in the law as it relates to fetuses and embryos.
Professor Goldberg, in her article, although stating that she opposed the appointment of guardians ad litem, nevertheless recognized that some courts have appointed guardians ad litem in cases involving forced medical treatment, and that guardians ad litem have been appointed to represent fetuses in prosecutions of drug-abusing pregnant women under state criminal and childabuse provisions. See, also, the following commentaries on the question of the legal status of fetuses and the appointment of guardians ad litem for fetuses: Glaze, Combating Prenatal Substance Abuse: The State's Current Approach and the Novel Approach of Court-Ordered Protective Custody of the Fetus, 80 Marq. L.Rev. 793 (1997); Morris, Technology and the Legal Discourse of Fetal Autonomy, 8 U.C.L.A. Women's L.J. 47 (1997); Best, Fetal Equality? The Equality State's Response to the Challenge of Protecting Unborn Children, 32 Land & Water L.Rev. 193 (1997); Romney, Prosecuting Mothers of Drugexposed Babies: The State's Interest in Protecting the Rights of a Fetus Versus the Mother's Constitutional Rights to Due Process, Privacy and Equal Protection, 17 J. Contemp. L. 325 (1991); Lee, State ex rel. Angela M.W. v. Kruzicki: The Wisconsin Court of Appeals Introduces a Dangerous New Weapon in the Battle Over "Fetal Rights," 30 Ga. L.Rev. 1183 (1996); Misner, What if Mary Sue Wanted an Abortion Instead? The Effect of Davis v. Davis on Abortion Rights, 3 Am. U.J. Gender & L. 265 (1995); Hartsoe, Person or ThingIn Search Of The Legal Status Of A Fetus: A Survey Of North Carolina Law, 17 Campbell L.Rev. 169 (1995); Flannery, Court-Ordered Prenatal Intervention: A Final Means to the Gestational Substance Abuse, 30 J. Fam. L. 519 (1991/92); Axelrod, Whose Womb is it Anyway: Are Paternal Rights Alive and Well Despite Danforth?, 11 Cardozo L.Rev. 685 (1990); Dargatz, Legal Representation of a Fetus: The Mother and Child Disunion?, 18 Cap. U.L.Rev. 591 (1989); Rickhoff and Cukjati, Protecting the Fetus from Maternal Drug and Alcohol Abuse: A Proposal for Texas, 21 St. Mary's L.J. 259 (1989); Balisy, Maternal Substance Abuse: The Need to Provide Legal Protection for the Fetus, 60 S. Cal. L.Rev. 1209 (1987).
[5] See generally Planned Parenthood of Southeastern Pennsylvania v. Casey, 505 U.S. 833, 874, 112 S. Ct. 2791, 120 L. Ed. 2d 674 (1992) ("The fact that a law which serves a valid purpose, one not designed to strike at the right itself, has the incidental effect of making it more difficult or more expensive to procure an abortion cannot be enough to invalidate it.").
[6] See Rule 28(A)(1)(a), (2)(b), Ala.R.Juv.P.; §§ 12-12-34 and -72, Ala.Code 1975. | 6292f1a3927c68ab5fe4635604dc59795a1497771f4347f6d30d1163af0f4699 | 1998-08-03 00:00:00 |
348f4d59-d09a-498f-8c70-ca8aa58e1a91 | Hogan v. State Farm Mut. Auto. Ins. Co. | 730 So. 2d 1157 | 1970775 | Alabama | Alabama Supreme Court | 730 So. 2d 1157 (1998)
Allison D. HOGAN and Joseph D. Hogan, Jr.
v.
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY.
1970775.
Supreme Court of Alabama.
September 4, 1998.
Rehearing Stricken October 16, 1998.
Belinda M. Kimble, Birmingham; and Samuel L. Masdon of Masdon & Masdon, Haleyville, for plaintiffs.
Ronald G. Davenport and William H. Webster of Rushton, Stakely, Johnston & Garrett, Montgomery, for defendant.
MADDOX, Justice.
The United States District Court for the Middle District of Alabama, acting pursuant to Rule 18, Ala.R.App.P., has certified to this Court the following question:
The facts, as submitted by the district court, are as follows:
(Emphasis in the original.)
The certified question presented to us requires an interpretation of two Alabama statutes, viz.: the so-called Alabama Guest Statute, § 32-1-2, Ala.Code 1975, and the Uninsured Motorist Statute, § 32-7-23, Ala. Code 1975. The Guest Statute provides:
§ 32-1-2, Ala.Code 1975. The Uninsured Motorist Statute provides that automobile insurance policies issued in this state shall cover "persons insured thereunder who are legally entitled to recover damages from owners or operators of uninsured motor vehicles because of" injury. § 32-7-23(a), Ala. Code 1975.
The basic question we are asked to answer is whether the Hogans can recover under the terms of their uninsured motorist policy even though they cannot recover from the alleged tortfeasor because the tortfeasor is immune from liability through the operation of the Guest Statute. The Hogans claim that the fact that the Guest Statute immunizes the tortfeasor does not affect their right to recover uninsured motorist benefits. They cite this Court's decision in State Farm Mut. Auto. Ins. Co. v. Jeffers, 686 So. 2d 248 (Ala.1996), in support of their argument that the alleged tortfeasor, Brunson, should be deemed "uninsured." We agree with their argument.
In Jeffers, which also involved a certified question from a federal court, a collision occurred between an automobile driven by the plaintiff, Mrs. Jeffers, and an automobile driven by a Houston County sheriff's deputy. This Court held that "[b]ecause of the application of the doctrine of substantive immunity, Deputy Anderson, in effect, was not insured." 686 So. 2d at 250. In Jeffers, the deputy's vehicle was covered by an insurance policy, as the alleged tortfeasor's vehicle is in this case. Except for the fact that the Jeffers case involved an application of the doctrine of substantive immunity and this case involves an application of the Guest Statute, we believe that these cases are so similar *1159 that the same principle of law that was applied in Jeffers should be applied in this case.
The decision in Jeffers was based in large part on this Court's interpretation of the Uninsured Motorist Statute in State Farm Auto. Ins. Co. v. Baldwin, 470 So. 2d 1230 (Ala.1985). In Baldwin, this Court held that an insured who was precluded from suing the owner or the operator of an uninsured motor vehicle was nevertheless "legally entitled to recover damages" under the Uninsured Motorist Statute.
State Farm argues that Jeffers and Baldwin should not control this case, arguing that "[u]nlike the plaintiffs in those two cases, Mrs. Hogan is not barred from recovery." State Farm contends that she "simply has a higher burden to meet than that of ordinary negligence." We cannot accept that distinction. As we view our holding in Jeffers, it was based on an interpretation of the intent of the Legislature in adopting the Uninsured Motorist Statute. In Jeffers, the fact that the plaintiff could not sue the tortfeasor because of the doctrine of substantive immunity did not affect the plaintiffs legal right to recover damages. In response to State Farm's argument that this case is distinguishable on the basis that the plaintiffs here "simply [have] a higher burden to meet," we note that the Court of Appeals, in McDonald v. Amason, 39 Ala.App. 492, 104 So. 2d 716 (1958), held that "the very wording of the [Guest Statute] ..., shows that its purpose is only to preclude recovery under degrees of fault rising only to the level of negligence." 39 Ala.App. at 494-95, 104 So. 2d at 718 (emphasis added). We agree with the plaintiffs that the reasoning this Court used in Jeffers and Baldwin controls here.[1]
We answer the question in the affirmative. The passenger, even though she may be precluded from suing the owner or the operator of the vehicle in which she was a passenger, because of the provisions of the guest statute, may nevertheless be "legally entitled to recover damages" under the Uninsured Motorist Statute.
CERTIFIED QUESTION ANSWERED.
HOOPER, C.J., and SHORES, KENNEDY, and COOK, JJ., concur.
SEE and LYONS, JJ., dissent.
LYONS, Justice (dissenting).
I respectfully dissent because I consider the holdings of State Farm Auto. Ins. Co. v. Baldwin, 470 So. 2d 1230 (Ala.1985), and State Farm Mut. Auto. Ins. Co. v. Jeffers, 686 So. 2d 248 (Ala.1996), to misapply the rather plain limitation in § 32-7-23(a), Ala. Code 1975. The statute requires coverage for persons carrying uninsured motorist insurance when such persons are "legally entitled to recover damages from owners or operators of uninsured motor vehicles." Id. I believe that whether an insured is "legally entitled to recover" depends entirely on the merits of the insured's claim against a tortfeasor under the laws of the state. However, today's decision, like Baldwin and Jeffers, has construed that phrase to mean "legally entitled to recover but for a defense that does not arise out of any wrongful conduct of the insured," a defense such as immunity or an insured's status as a guest.
Under the majority's expansive rationale, an employee/ passenger in a company-owned automobile who is precluded, by § 25-5-11, Ala.Code 1975, from recovering against a fellow employee/ driver for negligence or *1160 wanton misconduct would be entitled to payment under his or her uninsured motorist coverage.[2] The expansive interpretation the majority reiterates today, which is not in harmony with the law of other states,[3] has not provoked any amendments to the Uninsured Motorist Statute, § 32-7-23(a), since the Baldwin decision. I cannot equate the legislature's inaction with approval of the Court's treatment in prior cases of the phrase "legally entitled to recover damages from owners or operators of uninsured motor vehicles."[4]
The public, not the insurer, ultimately will bear the cost, through increased insurance premiums, of today's decision to require expanded uninsured motorist coverage. Expanded coverage is appropriate when the policyholder and the insurer contract for it or when the legislature requires it. But, such coverage should not be imposed by a court through an expansive interpretation of clear statutory language.
SEE, J., concurs.
Note from the reporter of decisions: On October 16, 1998, the Supreme Court entered an order stating: "The application for rehearing filed in this cause is stricken." The order cited Burnham Shoes, Inc. v. West American Insurance Co., 504 So. 2d 238, 242 (Ala.1987). Chief Justice Hooper and Justices Shores, Houston, Kennedy, and Cook concurred. Justices Maddox, See, and Lyons dissented. Justice Maddox issued the following opinion:
MADDOX, Justice (dissenting).
I respectfully dissent from the per curiam order striking the application for rehearing. It is my opinion that such applications can and should be addressed by this Court on their merits. See Roe v. Mobile County Appointment Board, 676 So. 2d 1206, 1264 (Ala.1995) (Maddox, J., dissenting on application for rehearing). In dissenting from the order striking the application, I should not be understood as expressing any opinion on the merits of the arguments raised in the application.
SEE and LYONS, JJ., concur.
[1] We note that, Jeffers was decided on December 13, 1996, and that Baldwin was decided on May 10, 1985. The Legislature has convened many times since this Court interpreted the uninsured motorist statute in Baldwin, and the Legislature has also met twice since this Court released its decision in Jeffers. We can assume that the Legislature has been aware of the interpretation this Court made of the uninsured motorist statute in those cases. Cf. Jones v. Conradi, 673 So. 2d 389 (Ala.1995) ("when the legislature readopts a [Code] section, or incorporates it into a subsequent [Code,] prior decisions of this court permeate the statute, and it is presumed that the legislature ... adopted the statute with knowledge of this court's interpretation"), quoting Edgehill Corp. v. Hutchens, 282 Ala. 492, 495-96, 213 So. 2d 225, 227-28 (1968). Although it has not chosen to do so in the years since Baldwin, the Legislature, of course, has the prerogative to change the statute so as to avoid the interpretation adopted by this Court in Baldwin, Jeffers, and this case. If the interpretation we make is inconsistent with the legislative intent, the Legislature is free to correct that inconsistency through legislation.
[2] The "exclusivity" provisions of the Workers' Compensation Statute bar an injured worker from suing a coworker unless the coworker caused the injury by willful conduct. § 25-5-11, Ala.Code 1975.
[3] See, e.g., Sayan v. United Services Auto. Ass'n, 43 Wash. App. 148, 716 P.2d 895, review denied, 106 Wash. 2d 1009 (table) (1986); Byrn v. American Universal Ins. Co., 548 S.W.2d 186 (Mo.Ct. App.1977). For further discussion, see 7 Am. Jur.2d Automobile Insurance § 297 (1980) and 9 Lee R. Russ, Couch on Insurance 3d §§ 123:18, 123:20 (1997), and cases cited therein.
[4] For legislative inaction to constitute approval of a court interpretation, the legislature must have amended or reenacted the statute after the court's interpretation, without changing the part that had been interpreted. State, Dep't of Revenue of Jefferson County v. Alabama Leasing Co., 336 So. 2d 1353, 1356 (Ala.1976). | bd6c7f91ddfe5b057cd9cfb5effc454885711f2990c9452cd0026a65735fe265 | 1998-10-16 00:00:00 |
81edaff4-0fa4-4a76-bf16-b25a08a3deca | Life Ins. Co. of Georgia v. Johnson | 725 So. 2d 934 | 1970037 | Alabama | Alabama Supreme Court | 725 So. 2d 934 (1998)
LIFE INSURANCE COMPANY OF GEORGIA
v.
Daisey L. JOHNSON.
1970037.
Supreme Court of Alabama.
August 21, 1998.
Rehearing Denied November 20, 1998.
*935 J. Mark Hart of Olschner & Hart, P.C., Birmingham; and Davis Carr and Kathleen *936 Cobb Kaufman of Carr, Alford, Clausen & McDonald, Mobile, for appellant.
Sidney W. Jackson III and Robert J. Hedge of Jackson, Taylor & Martino, P.C., Mobile; and Wyman O. Gilmore, Jr., of Gilmore & Gilmore, Grove Hill, for appellee.
SHORES, Justice.
This is the third time this case has been before this Court. The issue now concerns postjudgment interest.
Daisey L. Johnson's action against the Life Insurance Company of Georgia resulted in a jury verdict awarding Ms. Johnson $250,000 in compensatory damages and $15 million in punitive damages. The trial court entered a judgment on that verdict on June 2, 1994. At that time, the parties agreed that interest on the punitive damages portion of the judgment would be waived for 30 days to allow the trial court to rule on various posttrial motions filed by Life of Georgia. In disposing of those motions, the trial court remitted the punitive damages award to $12.5 million. On appeal, this Court affirmed, on the condition that Ms. Johnson accept a remittitur of the punitive damages award to $5 million. Life Ins. Co. of Georgia v. Johnson, 684 So. 2d 685 (Ala.1996) (Johnson I).
Following this Court's ruling in Johnson I, Life of Georgia conceded its obligation to pay the compensatory damages portion of the judgment. On June 18, 1996, Life of Georgia tendered to Ms. Johnson's counsel a check in the amount of $306,142.60, in satisfaction of the $250,000 compensatory damages portion of the judgment, plus interest accrued on that amount through May 18, 1996. Ms. Johnson accepted the money, without objection, but did not sign any document indicating that the check was accepted as partial satisfaction of the entire judgment.
Meanwhile, Life of Georgia sought certiorari review by the United States Supreme Court, contending that the punitive damages award violated the Due Process Clause of the Fourteenth Amendment to the United States Constitution. On October 15, 1996, the United States Supreme Court granted Life of Georgia's petition for certiorari review, vacated the judgment of this Court, and remanded the case for reconsideration in light of that Court's opinion in BMW of North America v. Gore, 517 U.S. 559, 116 S. Ct. 1589, 134 L. Ed. 2d 809 (1996). Life Ins. Co. of Georgia v. Johnson, ___ U.S. ___, 117 S. Ct. 288, 136 L. Ed. 2d 207 (1996) (memorandum). On remand, this Court issued an opinion, on August 15, 1997, again affirming the trial court's judgment, conditioned upon Ms. Johnson's accepting a remittitur of the punitive damages award to $3 million, alternatively ordering a new trial should she fail to accept that amount. Life Ins. Co. of Georgia v. Johnson, 701 So. 2d 524 (Ala.1997) (Johnson II). On August 20, 1997, Ms. Johnson accepted the remittitur of the punitive award. On August 21, 1997, Life of Georgia tendered to Ms. Johnson checks for $3 million and $986.30, in satisfaction of the punitive damages award and the interest accruing upon it from August 20 to August 21, 1997. This Court issued its certificate of judgment on September 3, 1997, which provided in pertinent part: "IT IS NOW CONSIDERED, ORDERED AND ADJUDGED that the judgment of the circuit court for punitive damages be reduced to $3,000,000 and, as thus reduced, the judgment of the circuit court is hereby affirmed, with interest and costs."
Thereafter, a dispute arose between the parties regarding postjudgment interest. On September 8, 1997, Ms. Johnson filed in the circuit court a motion pursuant to Rule 65.1, Ala. R. Civ. P., to "calculate interest, enter judgment and enforce surety's liability to pay $1,129,315 in accrued interest," claiming that Life of Georgia and its sureties still owed interest in that amount on the $3 million punitive damages award from June 2, 1994, the date the trial court entered its judgment. On September 11, 1997, Life of Georgia filed in the circuit court an objection to Ms. Johnson's motion and filed a motion requesting this Court to amend its September 3, 1997, certificate of judgment to specify that postjudgment interest began accruing on August 20, 1997, the date Ms. Johnson filed her acceptance of the remittitur. On September 18, 1997, Ms. Johnson filed in the circuit court a supplemental motion, contending that the payment of $306,142.60 on June 18, 1996, and the payments of $3 million and $986.30 *937 on August 21, 1997, should be applied first to interest on the entire $3.25 million judgment, leaving a principal balance of $1,167,278.45, which, she claimed, continued to accrue interest at 12% per annum.
On September 22, 1997, the trial court issued an order stating in relevant part as follows:
This order adopted Ms. Johnson's position that interest on the judgment began accruing on June 2, 1994, the date of the original judgment on the jury's verdict, but was suspended for 30 days pursuant to the parties' agreement; thus, the trial court calculated interest beginning July 2, 1994. The trial court's order also accepted Ms. Johnson's argument that Life of Georgia's payments on June 18, 1996, and August 21, 1997, were "partial payments" to be applied first to interest and then to principal on the entire amount of the judgment, without respect to any division of the judgment as to punitive versus compensatory damages. Thus, the trial court's order held as ineffective Life of Georgia's attempt to stop the accrual of interest on the compensatory damages portion of the judgment via its $306,142.60 payment on June 18, 1996.
Life of Georgia appeals the trial court's order. Life of Georgia has also filed a motion to consolidate its appeal with its motion of September 11, 1997, requesting this Court to amend its September 3, 1997, certificate of judgment. We grant the motion to consolidate, and we consider together the appeal and the motion to amend the certificate of judgment.
Life of Georgia concedes that 12% per annum postjudgment interest applies to the punitive damages award.[1] However, it maintains that interest began to accrue on August 20, 1997, the date upon which Ms. Johnson filed her acceptance of the remittitur of the punitive damages award following our decision in Johnson II, rather than on July 2, 1994 (30 days after the entry of the original judgment), as the trial court held. In fact, Life of Georgia asserts that the trial court had no authority to enter an order awarding postjudgment interest before August 20, 1997, because this Court's certificate of judgment, while allowing Ms. Johnson to recover "interest," did not specify the date on which interest would begin to accrue.
In support of its position, Life of Georgia directs our attention to a line of federal decisions emanating from the United States Supreme Court's ruling in Briggs v. Pennsylvania R.R., 334 U.S. 304, 68 S. Ct. 1039, 92 L. Ed. 1403 (1948). The plaintiff in Briggs obtained a jury verdict awarding money damages, but the trial court held that the defendant was, as a matter of law, entitled to a judgment of dismissal. The court of appeals reversed and directed the trial court to reinstate the jury's verdict and to enter a judgment in favor of the plaintiff, but the appellate court's mandate made no mention of interest. The Supreme Court held that the trial court was bound to follow the mandate of the appellate court and was therefore powerless to award interest for the period before the entry of the judgment on remand, *938 where the appellate court's mandate did not authorize such action. 334 U.S. at 307-08.
Life of Georgia also emphasizes the importance of Ala. R.App. P. 37, which provides:
This rule is virtually identical to the federal rule, F.R.App. P. 37, and this Court has noted that an interpretation of a federal rule is persuasive authority for our interpretation of a corresponding state rule. See, e.g., Smith v. MBL Life Assur. Corp., 604 So. 2d 406, 407-08 (Ala.1992). The Advisory Committee's Comments to F.R.App. P. 37 state:
See also DeLong Equipment Co. v. Washington Mills Electro Minerals Corp., 997 F.2d 1340, 1341 (11th Cir.1993) (stating that Rule 37, F.R.App. P., "codifies" the result in Briggs).
Life of Georgia claims that, for the purposes of Ala. R.App. P. 37, our judgment in Johnson II, affirming the trial court's judgment, conditioned upon Ms. Johnson's accepting a remittitur, effectively "modified" the trial court's initial judgment "with a direction that a judgment for money be entered in the trial court." Life of Georgia contends that the second sentence of Ala. R.App. P. 37 is therefore applicable. And because this Court's certificate of judgment did not specify that interest awarded was to be calculated based upon the initial trial-court judgment of June 2, 1994, Life of Georgia argues that, under the Briggs rule, the trial court, on remand, was without authority to calculate interest until Ms. Johnson first petitioned this Court to amend its certificate of judgment.
We must consider the Briggs rule and Ala. R.App. P. 37 along with controlling statutes. The Alabama legislature, unlike the Congress, has directly addressed this issue. Section 12-22-71, Ala.Code 1975, provides:
(Emphasis added). It has long been the rule in Alabama that where, pursuant to this section, an appellate court affirms a judgment based upon an appellee's accepting a remittitur of excessive damages, interest on the reduced amount is to be calculated from the date of the rendition of the judgment in the trial court. See, e.g., Louisville & N. R.R. v. Parker, 223 Ala. 626, 138 So. 231 (1931); United States Fidelity & Guaranty Co. v. Millonas, 206 Ala. 147, 89 So. 732 (1921); Montgomery Iron Works v. Capital City Ins. Co., 162 Ala. 420, 50 So. 358 (1909).
*939 Indeed, this Court has held that when an appellate court affirms a money judgment but alters the amount due, the total sum so fixed bears interest from the date of the trial court's judgment, even without an express provision to that effect, because that is the "legal effect" of the affirmance. Kinney v. Pollak, 225 Ala. 229, 231, 142 So. 390 (1932). Thus, subsequent action by an appellate court in reducing a judgment does not prevent interest from attaching upon the reduced amount and running from the date of the original judgment. Lowe v. General Motors Corp., 527 F. Supp. 54 (N.D.Ala.1981). See also Schulte v. Smith, 708 So. 2d 138 (Ala.1997) (holding that postjudgment interest began to accrue on a remitted damages award on the date of the trial court's original judgment, where this Court held, on the plaintiff's appeal, that a statutory damages limitation the trial court had applied to the plaintiff's award was unconstitutional, and, on the defendants' appeal, that the jury's damages award was excessive); Smith v. MBL Life Assur. Corp., 604 So. 2d 406 (Ala.1992) (holding that when a judgment is affirmed on appeal postjudgment interest accrues from the initial entry of a money judgment, as if no appeal had been taken, even if the delay in payment partially results from the plaintiff's appeal from a JNOV granted in favor of the defendant as to a portion of the jury's verdict).
In this case, the trial court entered a final judgment in favor of Ms. Johnson on her fraud claims. On appeal, this Court affirmed that judgment, conditioned upon Ms. Johnson's accepting a remittitur of the punitive damages to $3 million. She filed an acceptance of that remittitur. By the operation of § 12-22-71, our judgment entered in Johnson II for the reduced amount "[was] and remain[ed] the judgment of the lower court and ... date[d] back to the time of the entry or rendition of the judgment in the lower court." Accordingly, there was no necessity for this Court to give the trial court a "direction that a judgment for money be entered in the trial court." We agree with Life of Georgia that Rule 37, Ala. R.App. P., must be read in pari materia with § 12-22-71; cf. Burlington Northern R.R. v. Whitt, 611 So. 2d 219 (Ala.1992) (Rule 37 must be read in pari materia with § 8-8-10, Ala. Code 1975). However, for the purposes of Rule 37, our action in Johnson II is deemed, under § 12-22-71, to have "affirmed" the judgment of the trial court, rather than to have "modified" it with a direction to enter a money judgment. Thus, under Rule 37, Ala. R.App. P., interest on Ms. Johnson's judgment would have been "payable from the date the judgment was entered in the trial court"June 2, 1994. Parker; Millonas; Montgomery Iron Works, supra. The parties, however, agreed to suspend the accrual of interest on the punitive damages portion of the judgment for 30 days, until July 2, 1994. Therefore, the trial court correctly concluded that postjudgment interest on the remitted $3 million punitive damages award is to be calculated from July 2, 1994.
We also note that Briggs and the other federal cases cited by Life of Georgia are distinguishable from the instant case. The federal cases involve situations where there was no valid judgment on a plaintiff's successful claim until a judgment was entered by the trial court on remand, in compliance with an appellate mandate. In several cases, the appellate court simply reversed a judgment entered by the trial court in favor of the defendant and directed the trial court to enter a judgment for the plaintiff on remand, see Briggs, supra; Indu Craft, Inc. v. Bank of Baroda, 87 F.3d 614 (2d Cir.1996); Affiliated Capital Corp. v. City of Houston, 793 F.2d 706 (5th Cir.1986); see also DeLong, supra (appellate court ordered reinstatement of a jury verdict for the plaintiff, after the trial court had granted the defendant's motion for a new trial). In other cases, the appellate court "modified" a trial court's judgment in favor of the plaintiff, so as effectively to invalidate the judgment entered below. See Leroy v. City of Houston, 906 F.2d 1068 (5th Cir.1990) (appellate court held that the plaintiffs had not been entitled to recover on the claim upon which the trial court had entered the judgment, but that they should have prevailed upon other claims the trial court erroneously denied); Gele v. Wilson, 616 F.2d 146 (5th Cir.1980) (appellate court "modified" the trial court's judgment by directing the trial court to reallocate fault for *940 damages and directed the entry of a new judgment). Accordingly, without a valid prior judgment on a successful claim, there was no existing obligation in favor of the plaintiff for the defendant to satisfy, and no interest could be said to have accrued. In contrast, the trial court in this present case entered a judgment in favor of Ms. Johnson on her fraud claims, thereby creating an obligation on the part of Life of Georgia. Pursuant to § 12-22-71, this Court affirmed and its judgment related back to the date the trial court had entered its judgment, validating Life of Georgia's preexisting obligation. Life of Georgia is not entitled to relief on this ground.
Life of Georgia next argues that the October 15, 1996, memorandum order of the United States Supreme Court, which granted Life of Georgia's petition for certiorari review, vacated the judgment, and remanded the case to this Court for reconsideration, had the effect of nullifying the punitive damages award from its inception. Therefore, Life of Georgia argues, there was no valid punitive damages judgment until this Court issued its opinion on remand. We disagree.
The Supreme Court's action had the effect of nullifying only this Court's Johnson I judgment affirming conditionally the trial court's judgment. The Supreme Court's order did not void the underlying judgment entered by the trial court. This is evident from the fact that Ms. Johnson was not required upon remand to secure a second judgment in the trial court. Rather, the Supreme Court's mandate directed this Court to reconsider the propriety of the judgment the trial court had entered on June 2, 1994. See Johnson II, 701 So. 2d at 525 ("On certiorari review, the Supreme Court of the United States vacated this Court's judgment and remanded this case for us to determine whether the punitive damages awarded in this case are reasonable under the guidelines established by the Supreme Court in BMW of North America, Inc. v. Gore ....") (emphasis added). Life of Georgia's argument on this ground is due to be rejected.
Life of Georgia next argues that the trial court's order incorrectly authorizes the recovery of postjudgment interest under the supersedeas bond. Life of Georgia points out that the terms of the bond stipulate that the obligation assumed in the bond is to "satisfy such judgment, penalties, and costs, including such costs of appeal as may be awarded...." Life of Georgia argues that the bond does not specifically mention "interest" and, therefore, does not create an obligation on the part of the surety to pay postjudgment interest.[2]
In Hudson v. Hudson, 555 So. 2d 1084 (Ala.Civ.App.1989), the Court of Civil Appeals encountered an argument similar to that now advanced by Life of Georgia. In Hudson, the wife in a divorce case was found to be in contempt of court for her failure to deed certain property to the husband pursuant to a divorce judgment. In order to prosecute her appeal, the wife posted a supersedeas bond in which she agreed to "satisfy such judgment, penalties, costs, including costs of appeal as may be rendered in this case"; that is substantially the same language appearing in the bond in the instant case. After a judgment in favor of the husband, the husband sued on the bond to recover attorney fees incurred, depreciation, interest on the value of the land, taxes, and interest on the mortgage debt during the time that the wife unlawfully retained title to the land. The wife argued that "because `attorney fees,' `taxes,' `interest,' and `expert witness fees' were not specifically designated as damages recoverable under the bond, the husband [could] not recover these as `costs of appeal.'" 555 So. 2d at 1085. The Court of *941 Civil appeals rejected the wife's argument, recognizing that the purpose for requiring the bond is "`to keep the parties in statu quo pending the appeal. The purpose, we now say, reached not only to possession of the property, but every other consequence of the judgment, including costs, and the evidential status and value of the judgment pending appeal.'" Hudson, 555 So. 2d at 1085-86, quoting Fidelity & Deposit Co. of Maryland v. Torian, 221 Ala. 131, 133, 127 So. 829, 831 (1930), and citing other cases. The Court of Civil Appeals upheld the award of the items sought by the husband, concluding that under Rule 8, Ala. R.App. P., it was not required that the specific items of "damages" be set out in the supersedeas bond. Hudson, 555 So. 2d at 1085-86.
We conclude that the trial court correctly held that the supersedeas bond imposed liability upon the sureties for interest on the judgment principal. Under Hudson, the accrued interest might be considered to be included within the "costs of appeal." Further, the supersedeas bond provided that the sureties promised to "satisfy such judgment... as may be awarded." The "judgment" of this Court on appeal in Johnson II was that Ms. Johnson was entitled to recover $3 million in punitive damages, "with interest." Thus, the bond obligated the sureties to "satisfy" that "judgment." We find no error in this regard.
Life of Georgia argues that the trial court ruled erroneously regarding the application of "partial payments" on Ms. Johnson's judgment. Following our decision in Johnson I, Life of Georgia, on June 18, 1996, tendered a check for $306,142.60 to Ms. Johnson's counsel. With this check was a letter stating, in pertinent part:
It is undisputed that Ms. Johnson accepted the check without reservation or objection. It is also uncontested that Ms. Johnson did not sign any document regarding the application of the funds to the judgment debt and that no credit or partial satisfaction of judgment was entered on the record.
The trial court concluded that Life of Georgia's payment did not satisfy the compensatory damages portion of the judgment and was not even to be considered a partial payment of compensatory damages. Rather, the court accepted Ms. Johnson's argument that the check constituted a partial payment that, pursuant to § 8-8-11, Ala.Code 1975, was due to be applied first to the interest that had accrued upon the entire $3.25 million judgment ($3 million punitive + $250,000 compensatory) for the period from July 2, 1994 (30 days following the entry of judgment) until June 18, 1996 (the date of Life of Georgia's payment), without respect to any division between the compensatory and punitive portions of the judgment. Thus, the trial court held that Life of Georgia's payment did not operate to halt the accrual of interest upon any portion of the judgment principal. Life of Georgia maintains, however, that Ms. Johnson accepted the $306,142.60 check as payment toward the compensatory damages award plus interest accruing thereon and, therefore, Life of Georgia claims, she waived her right to argue that the payment should be deemed, retrospectively, merely a partial payment on the entire judgment.
Whether Life of Georgia's payment on June 18, 1996, was to be applied to interest and principal as to the compensatory damages portion of the award or to the interest that had accrued on the entire judgment award raises what appear to be questions of first impression in Alabama. However, it has elsewhere been recognized:
Bassett v. Eagle Telecommunications, Inc., 750 P.2d 73, 77 (Colo.App.1987).
We see no reason why a defendant who concedes his liability as to a portion of a judgment should not be able to make payments toward satisfying, and halting the accrual of interest upon, that part while his appeal of another part of the judgment is pending. Life of Georgia's correspondence to Ms. Johnson expressly stated that the payment of $306,142.60 was for the conceded liability regarding the compensatory damages award. Ms. Johnson accepted this payment without reservation. It is unmistakable that both Ms. Johnson and Life of Georgia at that time considered the payment to be applicable to the compensatory damages award, plus the interest accrued thereon. We conclude that the trial court erred when it failed to apply the payment in that manner. It is true that, absent a contract to the contrary, when a partial payment on a debt is made, the payment is to be first applied on the amount of interest due and the balance applied on the principal. Selman v. Bryant, 261 Ala. 53, 58, 72 So. 2d 704, 708 (1954); De Moville v. Merchants & Farmers Bank of Greene County, 237 Ala. 347, 186 So. 704 (1939); § 8-8-11, Ala.Code 1975. However, the question here is whether the parties intended Life of Georgia's payment to be credited to the compensatory damages portion of the judgment, as opposed to the punitive damages portion. We conclude, given the evidence in this case, that they did, and the trial court should have treated the payment in accordance with the parties' intentions.
Ms. Johnson argues that she never signed a partial satisfaction of judgment as to the compensatory award and that no acknowledgment of satisfaction of that award was entered on the record. She asserts, therefore, that Life of Georgia's payment should not be credited toward the compensatory damages award. However, she concedes that she received Life of Georgia's letter explaining the purpose of the payment and that she accepted the check without objection and deposited it. Where it is undisputed that payment has been received, a judgment may be satisfied notwithstanding that a formal entry of satisfaction has not been entered on the record. Butler v. GAB Business Services, Inc., 416 So. 2d 984 (Ala. 1982). It undoubtedly would have been preferable for the parties to make an express agreement regarding the application of the payment to the compensatory damages award and to enter a satisfaction on the record; however, we conclude that their failure to do so should not, under the facts of this case, prevent Life of Georgia's payment from being credited toward the compensatory damages award, as the parties clearly intended. Thus, we reverse the judgment of the trial court insofar as it did not apply Life of Georgia's payment of $306,142.60 toward the amount owed on the compensatory damages portion of the award.[3]
Finally, Life of Georgia claims that an award of postjudgment interest dating from July 2, 1994, on the $3 million punitive damages award is impermissibly punitive and violates the Due Process Clause of the Fourteenth Amendment. Life of Georgia argues that to uphold an award of such interest would be to exact a penalty for successfully challenging a constitutional wrong; to exact such a penalty would, Life of Georgia asserts, violate "`[e]lementary notions of fairness enshrined in our constitutional jurisprudence,'" appellant's brief at 30, quoting BMW, supra, 517 U.S. at 574. Life of Georgia also contends that an award of such interest would violate its right to due process because, it says, the interest award would bear no rational *943 relationship to the legitimate state interests at issue.
Life of Georgia cites no authority holding that an award of postjudgment interest from the date of the entry of the initial judgment on a later-remitted damages award is a denial of due process. Indeed, we can find no such case. However, Life of Georgia is charged with knowledge of the law and was therefore on notice that under Rule 37, Ala. R.App. P, and §§ 8-8-10 and 12-22-71, and under cases interpreting that rule and those statutes, postjudgment interest is deemed to accrue on a remitted damages award from the date of the original judgment in the trial court. Cf. County of Los Angeles v. Salas, 38 Cal. App. 4th 510, 45 Cal. Rptr. 2d 61 (1995) (defendant was charged with knowledge that California law provided for postjudgment interest on a child support arrearage; thus the defendant's due process "notice" claim was invalid). Indeed, it is apparent from the record that Life of Georgia's counsel had actual knowledge that postjudgment interest began to accrue on the punitive damages award as soon as the trial court entered its judgment on the jury's verdict.
We also note that, contrary to Life of Georgia's argument, postjudgment interest on the punitive damages award is not "punitive" in nature, except perhaps insofar as an award of interest operates to assure that the civil punishment assessed against Life of Georgia is not weakened by the mere passage of time. Postjudgment interest is, rather, "just compensation to ensure that a money judgment will be worth the same when it is actually received as when it was awarded." Dunn v. HOVIC, 13 F.3d 58, 60 (3d Cir. 1993); see also Elmore County Comm'n v. Ragona, 561 So. 2d 1092, 1093-94 (Ala.1990). The State has interests in ensuring that valid judgments are paid promptly and that a punishment assessed against a civil defendant is not diluted by inflation and the passage of time. We recognize that a defendant who appeals a damages award as excessive is in somewhat of a difficult position to the extent that the principal amount upon which postjudgment interest is deemed to have accrued may not be finally ascertainable until after the appeal is final. Thus, the exact amount due is clearly, in some sense, unliquidated during the appeal process, and the defendant will be unable to know how much he must pay to halt the accrual of all postjudgment interest. This situation has been exacerbated in the instant case because appellate litigation has been so substantial and extended. However, it must also be recalled that the plaintiff is not at fault for the delay in receiving payment and that it is she who has secured a judgment for the payment of money as the result of the defendants' wrongdoing. Interest would begin to accrue on Ms. Johnson's entire judgment once it was entered in the trial court; the effect of our ruling here simply allows interest to accrue only to the extent that the damages award was valid. We also note that other federal and state courts have granted postjudgement interest on remitted damages awards based upon the date of the entry of the original judgment. See, e.g., Dunn, supra; Coal Resources, Inc. v. Gulf & Western Industries, Inc., 954 F.2d 1263 (6th Cir.1992); Varney v. Taylor, 81 N.M. 87, 463 P.2d 511 (1969); Atlantic Coast Line R.R. v. Watkins, 99 Fla. 395, 126 So. 489 (1930); see also Klein v. Grynberg, 127 F.3d 1109 (10th Cir.1997) (table) (No. 96-1255, Oct. 20, 1997) (opinion not reported in F.3d). We hold that the trial court's order awarding postjudgment interest on the punitive damages award from July 2, 1994, does not violate the right to due process.
In conclusion, we affirm the trial court's determination that interest on Ms. Johnson's punitive damages award began to accrue on July 2, 1994, notwithstanding the United States Supreme Court's subsequent order vacating this Court's judgment in Johnson I. We also affirm the trial court's conclusions that an award of postjudgment interest from July 2, 1994, does not violate the Due Process Clause and that the supersedeas bond obligates the sureties for such postjudgment interest. We reverse the trial court's order, however, to the extent that it applied Life of Georgia's $306,142.60 payment on June 18, 1996, toward the interest accrued upon the entire $3.25 million judgment. We hold that the trial court should have credited that payment toward the compensatory damages portion of the judgment, as the parties intended.
*944 This case is remanded for the trial court to recalculate postjudgment interest in a manner consistent with this opinion.
MOTION TO CONSOLIDATE GRANTED; AFFIRMED IN PART; REVERSED IN PART; AND REMANDED.
HOOPER, C.J., and ALMON, HOUSTON, KENNEDY, COOK, and LYONS, JJ., concur.
MADDOX and SEE, JJ., concur in part, concur in the result in part, and dissent in part.
MADDOX, Justice (concurring in part, concurring in the result in part, and dissenting in part).
I concur in the result as to Part I. I agree with the views expressed by Justice See as to Parts II, III, IV, and V.
SEE, Justice (concurring in part, concurring in the result in part, and dissenting in part).
I concur with the majority's conclusion in Parts I and II that the accrual of interest on the entire amount of the judgment in this case began to run 30 days after the entry of the original judgment, pursuant to the parties' agreement and pursuant to Ala.Code 1975, §§ 8-8-10 and 12-22-71, and Louisville & N. R.R. v. Parker, 223 Ala. 626, 647, 138 So. 231, 250 (1931). I also concur with that portion of Part IV holding that the trial court erred in not applying the $306,142.60 payment by Life Insurance Company of Georgia ("Life of Georgia") toward the compensatory damages portion of the judgment. Butler v. GAB Business Services, Inc., 416 So. 2d 984 (Ala.1982). I concur in the result as to the majority's conclusion in Part III that the supersedeas bond covers interest on punitive damages, see generally Fidelity & Deposit Co. v. Torian, 221 Ala. 131, 133, 127 So. 829, 831 (1930), and as to its conclusion in Part V that the payment of interest on punitive damages does not violate the Due Process Clause of the Fourteenth Amendment to the Constitution of the United States, see generally Alabama State Federation of Labor v. McAdory, 246 Ala. 1, 9, 12-13, 17, 18 So. 2d 810, 814-15, 818, 822-23 (1944), cert. dismissed, 325 U.S. 450, 65 S. Ct. 1384, 89 L. Ed. 1725 (1945).
I dissent, however, from Part IV insofar as it fails to render a judgment in favor of Life of Georgia with respect to the satisfaction of Johnson's compensatory damages award. 725 So. 2d at 942 n. 3. Where a claimant accepts a check in settlement of a claim and that check is marked "payment in full," the acceptance extinguishes all liability with respect to that claim. See Public Nat'l Life Ins. Co. v. Highsmith, 47 Ala.App. 488, 495, 256 So. 2d 912, 918-19 (1971) (citing Hand Lumber Co. v. Hall, 147 Ala. 561, 567, 41 So. 78, 80 (1906) (holding that the acceptance of payment in settlement of a claim is the acceptance of the conditions of payment, including the condition that the payment settles the claim in full)). The undisputed evidence shows that Johnson cashed the check, which Life of Georgia tendered on the express condition that it would extinguish all liability for compensatory damages and interest thereon. In my view, Johnson's accepting and cashing the check operated to extinguish Life of Georgia's liability for compensatory damages and any interest thereon.
[1] Justice Maddox has previously opined in dissent to the denial of an application for rehearing that postjudgment interest should not accrue on a punitive damages award. See American Pioneer Life Ins. Co. v. Williamson, 681 So. 2d 1040 (Ala.1995) (Maddox, J., dissenting). However, we note that postjudgment interest on judgments for the payment of money is mandatory under § 8-8-10, Ala.Code 1975, which provides: "Judgments for the payment of money ... shall bear interest at the rate of 12 percent per annum... from the day of entry." Further, because Life of Georgia did not argue the point, we would not hold the trial court in error on that point.
[2] Ms. Johnson claims that Life of Georgia's argument on this issue "is largely moot" because "[a]ll money remaining due on August 21, 1997some $1,129,315was judgment principal, since the $3 million payment was used to pay accrued interest first." Appellee's brief at 15 n. 5. However, the trial court's order expressly states that "interest continues to accrue at 12% per annum on the $1,167,278.45 principal balance remaining." Because the trial court's order would impose liability upon the sureties to pay interest, we do not agree that the issue is moot.
[3] We do not here decide whether Life of Georgia's payment of $306,142.60 is to be considered as satisfaction of the $250,000 compensatory award plus all interest accrued thereon to the date of payment or is to be considered merely a partial payment on the compensatory award, applied first to accrued interest and then to principal, § 8-8-11, Ala.Code 1975. The trial court did not rule on the matter and that matter has not been fully briefed in this Court. We note, however, that the record is somewhat unclear as to this issue, because Life of Georgia's letter states that the payment included interest on the compensatory award "through May 18, 1996," rather than through June 18, 1996, the date of the payment. | 65acddbbc5a570b16b5aad1a22f9ac4b58c6b03b60e89e39251f1a64eb719a0d | 1998-08-21 00:00:00 |
c688a6c0-78bd-4ec5-a8ad-d8608de1fdc7 | Ex Parte Boles | 720 So. 2d 911 | 1970297 | Alabama | Alabama Supreme Court | 720 So. 2d 911 (1998)
Ex parte Donald Neil BOLES.
(Re Donald Neil BOLES v. John Earl KELLEY and State Farm Mutual Automobile Insurance Company).
1970297.
Supreme Court of Alabama.
August 14, 1998.
*912 Daine Sharpe of Sharpe & Reynolds, Dadeville, for petitioner.
William A. Austill and Conley W. Knott of Maddox, Austill & Parmer, P.C., Birmingham, for respondent John Earl Kelley.
COOK, Justice.
Donald Neil Boles petitions for a writ of mandamus directing the Tallapoosa Circuit Court to vacate its order transferring Boles's lawsuit against John Earl Kelley and State Farm Mutual Automobile Insurance Company to the Lee Circuit Court. We grant the petition.
Boles, a resident of Tallapoosa County, and Kelley, a resident of Lee County, were involved in an automobile accident that occurred in Russell County on October 13, 1996. Boles's insurance carrier, State Farm, is a foreign corporation that does business by agent in Tallapoosa County. On February 26, 1997, Boles filed a complaint in the Tallapoosa Circuit Court, stating a personal-injury claim against Kelley and a claim alleging that State Farm was obligated to pay uninsured/underinsured motorist benefits pursuant to Boles's policy with State Farm.
On May 14, 1997, pursuant to this Court's decision in Lowe v. Nationwide Ins. Co., 521 So. 2d 1309 (Ala.1988), State Farm filed a notice of its election not to participate in the litigation. Thereafter, on August 7, 1997, Kelley moved to change the venue of the action, relying on Rule 82(b)(1)(A), Ala. R. Civ. P.:
Kelley moved for a transfer of the action. He alleged that the accident occurred in Russell County, that he is a resident of Lee County, that Boles's lawsuit is a personal injury action, and that he is now the only remaining defendant in that action. Therefore, Kelley reasoned, he was entitled, pursuant to Rule 82(b)(1)(A), to have the action transferred to the Lee Circuit Court.
Boles objected, claiming that, pursuant to Ala.Code 1975, § 6-3-7; Rule 82, Ala. R. Civ. P.; and Ala. Const.1901, § 232 (as amended by Amendment 473), he could sue State Farm in any county in which it was doing business when he filed his action, including Tallapoosa County. If venue is proper as to one defendant it is proper as to all defendants, argued Boles, and, because venue was proper as to State Farm in Tallapoosa County when the action was filed, he argues, it was proper there as to both defendants.
Kelley responded by arguing that because State Farm had elected not to participate in *913 the lawsuit it was no longer a party upon whose presence venue could be based. After a hearing, the trial court transferred the action to the Lee Circuit Court.
Boles maintains that the trial court erred, as a matter of law, in transferring the action to the Lee Circuit Court, because the trial court's order, says Boles, ignored Ala. Code 1975, § 6-3-5(a) and § 6-3-7; Ala. Const.1901, § 232 (as amended by Amendment 473); and Ex parte Gauntt, 677 So. 2d 204 (Ala.1996). We believe Boles has correctly analyzed the applicable statutes and precedents and that he is entitled to the relief he seeks.
Section 6-3-5, the statute governing venue of actions against insurance corporations, provides, in part:
Section 6-3-7, the general statute governing venue of actions against corporations, provides:
Ala. Const.1901, § 232, as amended in 1988 by Amendment 473, provides, however, that a foreign corporation "may be sued only in those counties where such suit would be allowed if the said foreign corporation were a domestic corporation."
In Ex parte Gauntt, 677 So. 2d 204 (Ala. 1996), this Court held that, pursuant to § 6-3-7 and Amendment 473, if a plaintiff's cause of action alleges properly joined contract and personal injury claims, a foreign corporate defendant in that action may be sued in any county in which it does business. Therefore, when Boles filed his complaint against Kelley and State Farm, venue was proper in Tallapoosa County as to State Farm and as to Kelley as well, under the rule that if venue is proper as to one defendant, it is proper as to other properly joined defendants.
Kelley argues that, pursuant to the decisions in Lowe v. Nationwide Ins. Co., 521 So. 2d 1309 (Ala.1988); Ex parte Edgar, 543 So. 2d 682 (Ala.1989); and Ex parte Aetna Casualty & Surety Co., 708 So. 2d 156 (Ala. 1998), State Farm's election not to participate in the litigation made Tallapoosa County an improper venue for this action.
In Lowe, the Court stated the issue as "[w]hether an insured may file a claim for underinsured motorist coverage against his or her own insurer in the same lawsuit with the insured's claim against the alleged underinsured motorist and litigate all the issues in one proceeding." 521 So. 2d 1309. We answered that question in the affirmative and provided a procedure under which the parties to such an action could accommodate several considerations underlying that issue: 1) protecting the right of the insurance carrier to know of, and participate in, the lawsuit; 2) protecting the right of the injured insured to litigate all claims in one action and thereby avoid a waste of time and money; and 3) protecting the liability phase of the trial from prejudice that might arise from "extraneous and corrupting influences, namely, evidence of insurance." 521 So. 2d 1309.
521 So. 2d at 1310 (some emphasis original; some emphasis added).
In Edgar and Aetna, the uninsured motorist carriers were named as defendants; however, pursuant to Lowe, the carriers elected not to participate in the trial, but attempted to reserve the right to participate or monitor discovery and to reenter the trial at a later time. Kelley finds support for his position in the following language from this Court's opinions addressing mandamus petitions filed by the insurance companies in Edgar and Aetna:
Ex parte Edgar, 543 So. 2d at 684 (emphasis added).
Ex parte Aetna Casualty & Surety Co., 708 So. 2d at 158.
Pursuant to Edgar and Aetna, argues Kelley, when State Farm elected not to participate in Boles's lawsuit, State Farm was "dismissed" as a party to the action and venue of the action was no longer proper in Tallapoosa County. We disagree. Although Edgar and Aetna speak of the insurer's being "dismissed" from the pending action, it is clear that, pursuant to Lowe, State Farm has simply withdrawn from the litigation by exercising its option "not to participate in the trial." 521 So. 2d at 1310.
The question of proper venue is ordinarily determined when the action is commenced. Elmore County Commission v. Ragona, 540 So. 2d 720 (Ala.1989); Ex parte Shelby County, 516 So. 2d 525 (Ala.1987). Rule 82(d)(2)(B), Ala. R. Civ. P., provides an exception to this rule:
Kelley argues that State Farm has been dismissed and that he, therefore, is the only remaining defendant. Thus, he says, the trial court correctly granted his motion to transfer, pursuant to the requirement of Rule 82(d)(2)(B) that "the court, ... on motion of all remaining defendants, shall transfer the action." However, under Rule 82(d)(2)(B), this requirement to transfer arises only after the dismissal of the defendant "has been made a final judgment as to that defendant pursuant to Rule 54(b)." The *915 materials before us indicate no judgment as to State Farm.
Because State Farm has not been "dismissed" as a defendant, Rule 82(d)(2)(B) is inapplicable here. We must conclude that proper venue for this action was determined when the action was filed. Kelley's argument that Rule 82(d)(2)(B) required the trial court to grant Kelley's motion to transfer is without merit.
Kelley also claims that State Farm's presence as a defendant in Boles's action should not be a basis for determining proper venue, because, he argues, State Farm was never a "material defendant." We disagree.
Isbell v. Smith, 558 So. 2d 877, 880 (Ala.1990).
In Elmore County Commission v. Ragona, supra, we held that the insurer in that case was a "material defendant," based, in part, on the fact that the insurer had refused to pay uninsured motorist benefits to its insured (the plaintiff), and on the fact that the insurer's interest was actually aligned with that of the other defendants. Here, State Farm has refused to pay Boles's claims for uninsured motorist benefits, and State Farm's interest in the case is certainly aligned with that of Kelleythe uninsured, or underinsured, motorist whose liability, if any, will be the basis for State Farm's being required to pay Boles's claims.
Tallapoosa County was a proper venue when this action was commenced, and that county was not made an improper venue by State Farm's election not to participate in the case. The trial court erred in granting Kelley's motion to transfer the case to the Lee Circuit Court. Boles has made a clear showing that the trial court erred to his detriment (Ex parte Harrington Manufacturing Co., 414 So. 2d 74 (Ala.1982))a detriment for which Boles has no remedy except by a writ of mandamus; therefore, Boles's petition is granted.
WRIT GRANTED.
ALMON, SHORES, and KENNEDY, JJ., concur.
HOOPER, C.J., and HOUSTON, SEE, and LYONS, JJ., concur specially.
MADDOX, J., concurs in the result.
HOOPER, Chief Justice (concurring specially).
I agree with the special writings in this case authored by Justice Houston and Justice Lyons. John Earl Kelley states in his brief: "Within a reasonable time after the action was filed, State Farm timely moved to withdraw under Lowe v. Nationwide [Insurance Co.], 521 So. 2d 1309 (Ala.1988). The trial court granted the motion, dismissing State Farm as a party to the case." If the trial court has granted State Farm's motion to withdraw, then only the procedural step of issuing a final judgment as to that motion is necessary to determine the proper venue. It appears that the wording of Rule 82, Ala. R. Civ. P., has swallowed up the substance and allowed forum shopping to occur, even though the posture of the parties in this case indicates that the action should be transferred. And as Justice Lyon's special writing points out, it may be that this Court in Lowe created the problem. Therefore, I too would support amending Rule 82 to correct this problem.
I have in the past expressed my opposition to forum shopping. See Ex parte Gauntt, 677 So. 2d 204 (Ala.1996) (Hooper, C.J., dissenting); Ex parte Associates Financial Services Co. of Alabama, Inc., 705 So. 2d 836 (Ala.1997) (Hooper, C.J., dissenting); and Ex *916 parte Dorsey, 700 So. 2d 1349 (Ala.1997) (Hooper, C.J., joining See, J., dissenting). See also Ex parte First Family Financial Services, Inc., 718 So. 2d 658 (Ala.1998). As a trial judge, I found the practice of forum shopping intolerable. As a Justice on this Court, I still find it so. It is my opinion that that is what is happening in this case.
HOUSTON, Justice (concurring specially).
This Court, for the sake of consistency, should amend Rule 82(d)(2)(B), Ala. R. Civ. P., to permit a trial court to transfer a case such as this one. However, as it presently reads, that rule does not permit a transfer in this case.
LYONS, Justice (concurring specially).
I concur specially to point out that Rule 82(d)(2)(B) was adopted before this Court, in Lowe v. Nationwide Ins. Co., 521 So. 2d 1309 (Ala.1988), established the practice of allowing a defendant insurance company to elect not to participate in an action. I suggest that the advisory committee on the Alabama Rules of Civil Procedure consider updating the rule so as to make it conform to the practice established in Lowe.
SEE, J., concurs. | 72a8b0106181740888034a7ace8557590e1aa1b50412ad7ad2432555354344ad | 1998-08-14 00:00:00 |
b270018e-e62f-46b7-94b4-1f2a7d322570 | Ex Parte Wal-Mart Stores, Inc. | 725 So. 2d 279 | 1970426 | Alabama | Alabama Supreme Court | 725 So. 2d 279 (1998)
Ex parte WAL-MART STORES, INC.
(Re Wal-Mart Stores, Inc. v. Joseph P. Hines III).
1970426.
Supreme Court of Alabama.
September 25, 1998.
*280 Charles F. Carr, Glenn E. Ireland, and Sarah J. Carlisle of Carr, Allison, Pugh, Oliver & Sisson, P.C., Birmingham, for petitioner.
Debra H. Coble and Frank V. Potts of Potts & Young, L.L.P., Florence, for respondent.
SHORES, Justice.
We granted certiorari review to consider the opinion of the Court of Civil Appeals, which held that the trial court had acted within its discretion in ordering that a judgment approving a workers' compensation settlement agreement between Wal-Mart Stores, Inc., and Joseph P. Hines III be set aside under Rule 60(b)(6), Ala. R. Civ. P., to the extent the judgment barred Hines from pursuing a pending claim seeking damages for an alleged retaliatory discharge. See Wal-Mart Stores, Inc. v. Hines, 725 So. 2d 275 (Ala.Civ.App.1997). We reverse and remand.
Hines injured his right shoulder on January 5, 1995, while working at a store operated by his employer, Wal-Mart. He filed a claim for workers' compensation benefits.[1] On June 30, 1995, Wal-Mart terminated Hines's employment. On August 30, 1995, Frank V. Potts, an attorney in Florence, sent a letter to Wal-Mart's corporate headquarters, in Bentonville, Arkansas, stating that Hines had contacted him and that he intended to file an action alleging that Wal-Mart had wrongfully terminated Hines in retaliation for his having filed a claim for workers' compensation benefits.[2] Brad L. Karren, an Arkansas attorney retained by Wal-Mart, sent a reply letter to Potts dated January 22, 1996, stating that it would be necessary for Karren to contact the Wal-Mart store involved to conduct a preliminary investigation and that Potts might expect a formal response by February 19, 1996. After receiving no further correspondence, Potts filed, on February 28, 1996, on Hines's behalf, an action against Wal-Mart, in the Lauderdale Circuit Court, alleging retaliatory discharge. That action was assigned No. CV-96-127.
Three weeks later, on March 21, 1996, Hines signed a workers' compensation settlement *281 agreement with Wal-Mart ("the settlement"). Although he was represented by counsel in the pending retaliatory discharge action, Hines neither brought an attorney with him when he signed the settlement agreement nor consulted with his attorney before signing it. The settlement agreement provided in pertinent part:
This language was drafted by Alabama lawyers that Wal-Mart had retained. In exchange for Hines's release, Wal-Mart agreed to pay Hines a lump sum of $8,500.
On the same day they executed the settlement agreement, the parties filed a joint petition in the Circuit Court of Lauderdale County to have the settlement approved. See § 25-5-56, Ala.Code 1975. That petition was given case No. CV-96-206, and it was assigned to Judge N. Michael Suttle. Judge Suttle explained to Hines, who appeared pro se, that he had the right to legal representation and that he, Judge Suttle, was not acting as his lawyer and was not giving him legal advice. Hines replied by stating that he understood that, but that he did not want a lawyer. Unaware that Hines had pending an action (CV-96-127) seeking damages for retaliatory discharge and that in that action he was represented by counsel, Judge Suttle entered a judgment on March 21, 1996, approving the settlement, and Hines acknowledged acceptance of the $8,500 settlement check.
On April 4, 1996, Hines's attorney in the retaliatory-discharge action (CV-96-127) sought a default judgment in that action, on the ground that Wal-Mart had not answered the complaint. On April 16, 1996, Judge Suttle entered a default judgment for Hines in case No. CV-96-127, the retaliatory-discharge action. On May 2, 1996, Wal-Mart moved to set aside that default judgment. Wal-Mart alleged that Hines's complaint had been addressed to Wal-Mart's general delivery address in Bentonville, Arkansas, rather than to its agent in Alabama designated to receive service of process, and that Hines's motion for a default judgment had been made on the 31st day after the certified mail receipt showed the arrival of the complaint at Wal-Mart's address in Bentonville. According to a supporting affidavit, the complaint arrived in the Wal-Mart mail room in Bentonville on March 4, 1996, but it was not received by Wal-Mart's legal department until April 9, 1996. On May 7, 1996, Judge Suttle set aside the default judgment, and Wal-Mart answered the complaint.
On September 26, 1996, Wal-Mart moved for a summary judgment on Hines's retaliatory discharge claim, asserting that it was precluded by the judgment approving the parties' settlement and release in case No. CV-96-206. On October 23, 1996, Hines filed a motion, styled as a motion pursuant to Rule 60(b)(6), Ala. R. Civ. P., seeking to set aside the judgment approving the settlement. In that motion, Hines claimed that when he signed the settlement he thought he was merely waiving his right to recover any future medical expenses and/or future vocational rehabilitation benefits resulting from his injury, not his right to recover for the alleged retaliatory discharge. Hines maintained that he was not told that the settlement could have such an effect, until Wal-Mart moved for a summary judgment in case No. CV-96-127. Hines also alleged that, when its lawyers negotiated the settlement with him, Wal-Mart knew that he had filed his retaliatory-discharge action and knew that he had retained counsel in that case; thus, he argued, "[Wal-Mart] can not state that the negotiated settlement included all claims, including the wrongful discharge claim, in that to include the wrongful discharge claim in the release would be a fraud upon the court because of [Wal-Mart's] prior knowledge of the lawsuit and representation." (Emphasis original.)
Also on October 23, 1996, Hines moved to consolidate the workers'-compensation-settlement case with the retaliatory-discharge case. Judge Suttle recused himself and assigned *282 the case to Judge Larry Mack Smith on November 4, 1996. Judge Smith set a hearing on Hines's Rule 60(b) motion, his motion to consolidate, and Wal-Mart's motion for a summary judgment. On December 3, 1996, Judge Smith entered an order stating, in pertinent part:
Wal-Mart appealed. The Court of Civil Appeals affirmed the order setting aside the judgment approving the settlement. That court held that Judge Smith had not abused his discretion in granting relief pursuant to Rule 60(b)(6). Without addressing whether Hines's motion stated a proper ground for relief under Rule 60(b)(6) or whether the motion was timely filed, the Court of Civil Appeals reasoned that there was evidence supporting the finding that, when he signed the settlement agreement on March 21, 1996, Hines had not intended to release Wal-Mart from liability in his pending retaliatory-discharge action. Therefore, the Court of Civil Appeals held, it was equitable for Judge Smith to modify the settlement order "to reflect the true intention of the parties." 725 So. 2d at 278.
In this Court, Wal-Mart argues that Hines's motion to set aside the judgment was based upon an allegation of mistake or inadvertence and that Hines was therefore, in reality, seeking relief under Rule 60(b)(1). Wal-Mart further contends that Hines's motion was, therefore, untimely and that it cannot be made timely by merely styling it as a Rule 60(b)(6) motion.
As a threshold matter, we note that the question whether the language of the approved settlement order would, if the order was not set aside, preclude Hines's retaliatory discharge action is not now before us. In setting aside the judgment, Judge Smith concluded that Hines's retaliatory-discharge claim was "arguably" released by the settlement.[3] Thus, the trial court did not expressly decide the issue, resolving the controversy instead by simply granting relief under Rule 60(b)(6). Thus, the issue in this Court, as it was in the Court of Civil Appeals, is whether the trial court erred in granting Hines's Rule *283 60(b) motion to set aside the judgment of March 21, 1996, which approved the settlement.
Rule 60(b) provides in pertinent part:
In R.E Grills, Inc. v. Davison, 641 So. 2d 225 (Ala.1994), this Court stated:
641 So. 2d at 229.
When considering Rule 60(b) motions, trial courts "attempt to balance the desire to remedy injustice against the need for finality of judgments." Raine v. First Western Bank, 362 So. 2d 846, 848 (Ala. 1978). "Whether to grant or deny relief under Rule 60(b)(6) is within the discretion of the trial judge, and the trial judge's ruling on that question will not be reversed except for an abuse of that discretion." Ex parte American Resources Ins. Co., 663 So. 2d 932, 936 (Ala.1995).
In Chambers County Comm'rs v. Walker, 459 So. 2d 861 (Ala.1984), this Court encountered a case with some elements that are also present in the case now before us. In Walker, the parties to a lawsuit had entered into a settlement whereby the defendants had agreed to pay the plaintiffs a sum in satisfaction of claims for personal injuries and property damage suffered as a result of an automobile accident. Because one of the plaintiffs was a minor, the court held a pro ami hearing, following which it entered a consent judgment based upon the settlement. Later, the plaintiffs brought another action, against the county commissioners, alleging that the county had negligently or wantonly constructed, operated, and maintained the intersection where the automobile accident had occurred and that their negligence or wantonness had caused the accident. The commissioners moved for a summary judgment, claiming that, as a matter of law, the satisfaction of the consent judgment based upon the settlement precluded the action against the county based upon the same accident. Three years after the entry of the consent judgment, the plaintiffs filed a motion for relief, under Rule 60(b)(6). 459 So. 2d at 863-64. The plaintiffs alleged as grounds for the motion, among other things, that before *284 entering into the settlement that formed the basis of the consent judgment they had been "assured" by their attorney and the presiding trial judge that the consent judgment would not prevent a subsequent action against the county and its commissioners arising out of the same facts. Id. at 864. The plaintiffs further alleged that, but for this assurance, they would not have consented to the entry of the first judgment. Id. The trial court granted relief based on Rule 60(b)(6), and the defendants appealed. This Court reversed, holding that the stated grounds "amount to a claim of mistake and/or inadvertence on the part of plaintiffs' counsel as to the effect the settlement, release, and judgment in the first action would have on any subsequent suit plaintiffs sought to maintain against the Commissioners," id. at 865, and fell within Rule 60(b)(1), not within the "extraordinary circumstances" contemplated by Rule 60(b)(6), id. at 866. Because the plaintiffs' motion sought relief based on Rule 60(b)(1), but was filed more than four months after the entry of the judgment, it was untimely. Id.
As was the case with the plaintiffs in Walker, Hines believed that a consent judgment incorporating an approved settlement would not bar a separate lawsuit brought by him, and he was granted relief under Rule 60(b)(6). Our holding here is similar to that in Walker: Hines's erroneous understanding of the effect of the settlement upon his retaliatory-discharge claim amounts to mistake and/or inadvertence on his part, which, if cognizable at all under Rule 60(b),[4] falls under Rule 60(b)(1). Hines emphasizes that, unlike the plaintiffs in Walker, he had already filed the action that was held to be barred by the judgment approving the settlement. However, this distinction does not remove Hines's claim for relief from the domain of Rule 60(b)(1); we still must conclude that Hines is alleging that he mistakenly and/or inadvertently entered into the settlement and consented to the judgment approving that settlement because he misapprehended the potential effect upon his then pending retaliatory-discharge claim. It is undisputed that Hines's Rule 60(b) motion was filed more than four months after the entry of the judgment approving the settlement and is, therefore, untimely under Rule 60(b)(1). Because the grounds listed in the various subsections of Rule 60(b) are mutually exclusive, Hines cannot obtain relief under Rule 60(b)(6) for grounds encompassed within Rule 60(b)(1).
Hines points out, however, that we have recognized that aggravating circumstances may allow a trial court to treat what would otherwise be a Rule 60(b)(1) motion as a Rule 60(b)(6) motion. See R.E. Grills, Inc. v. Davison, supra, 641 So. 2d at 229; Chambers County Comm'rs v. Walker, supra; Giles v. Giles, 404 So. 2d 649 (Ala.1981); and Rebel Oil Co. v. Pike, 473 So. 2d 529 (Ala.Civ.App. 1985). But in R.E. Grills, Inc. v. Davison, supra, 641 So. 2d at 230, this Court noted:
We conclude that Hines has failed to show such aggravating circumstances regarding *285 his mistaken understanding of the effect of the settlement on his pending retaliatory-discharge claim. Indeed, this particular mistake was Hines's very own, not that of his attorney. Hines made a voluntary choice to represent himself in connection with the settlement and not to consult with his retained attorney before entering into it.[5] "Rule 60(b)(6) [cannot] be used `for the purpose of relieving a party from the free, calculated, and deliberate choices he has made. A party remains under a duty to take legal steps to protect his own interest.'" Chambers County Comm'rs v. Walker, supra, 459 So. 2d at 866, quoting 11 C. Wright & A. Miller, Federal Practice and Procedure, § 2864, at 214-15 (1973).
We similarly hold that the testimony of Judge Suttle, indicating that he would not have approved the settlement had he known that Hines had pending a retaliatory-discharge claim in which he was represented by counsel, does not give rise to the "extraordinary circumstances" required for relief under Rule 60(b)(6). Judge Suttle's testimony amounts to a claim that he entered the judgment because he was under a mistaken impression as to the existence of certain facts, and perhaps also as to the legal effect of the settlement's preclusive language. However, it appears that Hines himself shoulders substantial responsibility for Judge Suttle's lack of awareness. When he appeared before Judge Suttle to have the settlement approved, Hines was obviously aware that he had filed a retaliatory-discharge claim and that he had retained counsel, yet he failed to notify Judge Suttle of these facts, even though the issue of his right to legal representation was specifically raised. Moreover, if Judge Suttle was not aware that the settlement could preclude a retaliatory-discharge action, it appears that the trial judge in Chambers County Comm'rs v. Walker, supra, had a similar misunderstanding; the plaintiffs in that case alleged that the trial judge had mistakenly "assured" them that their subsequent action against the county would be viable. 459 So. 2d at 864. Despite this fact, we concluded that the granting of Rule 60(b)(6) relief was inappropriate in that case, and we conclude likewise here.
Finally, Hines argues that, even if his Rule 60(b) motion was untimely as a motion seeking relief based upon allegations of mistake and/or inadvertence, Judge Smith's granting of that motion was justified on the basis that Wal-Mart had engaged in misconduct and fraud. Hines alleges that when he and Wal-Mart entered the settlement agreement, Wal-Mart knew both that he had filed a retaliatory-discharge action and that he was represented by counsel in that action. Hines contends that Wal-Mart's settling the retaliatory-discharge claim with him personally, as part and parcel of its settlement of his claim for workers' compensation benefits, when it knew that he was represented by counsel in the retaliatory-discharge case, was fraudulent and was tantamount to "an end run around the legal system." Respondent's brief at 10.
Section 25-5-56, Ala.Code 1975, states, "Settlements made may be vacated for fraud, undue influence, or coercion, upon application made to the judge approving the settlement at any time not later than six months after the date of settlement." Rule 60(b)(3), Ala. R. Civ. P., which is subject to a four-month limitation, similarly permits a judgment to be set aside where the judgment is the result of "fraud (whether heretofore denominated intrinsic or extrinsic), misrepresentation, or other misconduct of an adverse party." Rule 60(b)(3) is inapplicable here, however, because § 25-5-56 provides "`the exclusive method for vacating a workers' compensation settlement for fraud.'" Jenkins v. United States Fidelity & Guar. Co., 698 So. 2d 765, 767 (Ala.1997), quoting Clark v. Liberty Mut. Ins. Co., 673 So. 2d 395, 397 (Ala.1995). See also Hawkins v. Jim Walter *286 Resources, Inc., 600 So. 2d 1052 (Ala.Civ.App. 1992).
Hines's motion to set aside the order approving the settlement was styled as a Rule 60(b) motion, rather than as a motion filed pursuant to § 25-5-56, but it was, in fact, presented to the same trial judge who had approved the settlement on March 21, 1996. However, even assuming that Hines's motion otherwise qualified as a request under § 25-5-56 for relief from the settlement, based on fraud, it was filed on October 23, 1996, more than seven months after the date of the order approving the settlement. Thus, it was untimely under § 25-5-56. Jenkins, Clark, supra.
Moreover, we note that despite Hines's allegations of fraud and wrongdoing, the trial court's order did not contain findings suggesting that Wal-Mart or its attorneys were guilty of misconduct. While it is undisputed that Wal-Mart had received a letter indicating that Hines was at least contemplating filing a retaliatory-discharge claim, it appears that the trial court might have believed Wal-Mart's contention that its legal representatives were not aware that such an action had actually been instituted until after the settlement was approved on March 21, 1996.[6] Further, Hines admits that Wal-Mart's attorneys in Alabamawho negotiated the settlement, drafted the settlement agreement, and appeared at the hearing to have it approveddid not engage in any wrongdoing; Hines concedes that these lawyers did not know of Hines's pending retaliatory-discharge action, in which he was represented by counsel,[7] and that they simply drafted a settlement instrument with broad release language in order to provide maximum protection for their client. See Respondent's brief at 10.
Hines does not contend that Wal-Mart or its attorneys actually made a false representation to the effect that the settlement would not preclude a retaliatory-discharge action. He seems to contend, rather, that Wal-Mart committed fraud by failing to disclose to him that the settlement language could have the legal effect of precluding his pending retaliatory-discharge claim. However, neither Wal-Mart nor its attorneys had a duty to explain to Hines all of the potential legal consequences flowing from the settlement that might adversely affect his interests. Cf. Henson v. Estes Health Care Center, Inc., 439 So. 2d 74 (Ala.1983) (holding that an employer and its workers' compensation carrier had no duty to disclose to a worker acting pro se in settlement negotiations what legal rights she had under the workers' compensation statutes, because the law is accessible and is presumed to be known).
Based upon the foregoing, we hold that the trial court abused its discretion in setting aside, on the basis of Rule 60(b)(6), the judgment approving the settlement. Accordingly, the judgment of the Court of Civil Appeals is reversed and the cause is remanded.
REVERSED AND REMANDED.
HOOPER, C.J., and MADDOX, COOK, and SEE, JJ., concur.
LYONS, J., recuses himself.
[1] According to the opinion of the Court of Civil Appeals, Hines filed a complaint seeking workers' compensation benefits. It appears, however, that Hines never actually initiated a civil lawsuit by filing a complaint, but rather merely filed with his employer a claim for workers' compensation benefits.
[2] See § 25-5-11.1, Ala.Code 1975; see also McClain v. Birmingham Coca-Cola Bottling Co., 578 So. 2d 1299, 1301 (Ala.1991) (holding that a terminated worker can maintain an action alleging retaliatory discharge even though the worker claims to have been fired solely for filing a "claim" for workers' compensation benefits, rather than for filing an "action," i.e., a lawsuit, for such benefits, as a literal reading of § 25-5-11.1 would seem to require).
[3] We note that the language of the settlement between Hines and Wal-Mart is similar to that contained in judicially approved settlements that have been held to preclude claims alleging retaliatory discharge. See Gates Rubber Co. v. Cantrell, 678 So. 2d 754 (Ala.1996); Ex parte Aratex Services, Inc., 622 So. 2d 367 (Ala.1993); Brown v. B & D Plastics, Inc., 873 F. Supp. 1511 (M.D.Ala.1994).
[4] After Judge Smith had entered the order granting Hines's Rule 60(b) motion, the Court of Civil Appeals held that a worker's mistake concerning the effect of a workers' compensation settlement on a future retaliatory-discharge claim is a mistake of law that is not a proper ground for relief under Rule 60(b). See Dow-United Technologies Composite Products, Inc. v. Webster, 701 So. 2d 22, 24 (Ala.Civ.App.1997). See also Daugherty Associates v. Silmon, 535 So. 2d 135, 137 (Ala. 1988). Wal-Mart now, likewise, argues that Hines's mistaken understanding of the effect of the settlement agreement upon his pending retaliatory-discharge claim is a mistake of law that cannot be a proper basis for relief under Rule 60(b). However, it does not appear that Wal-Mart advanced this specific argument in the trial court; therefore, we will not address it. This Court cannot put a trial court in error for failing to or consider a matter that, according to the record, was not presented to or decided by the trial court. Rodriguez-Ramos v. Williams, 580 So. 2d 1326 (Ala.1991).
[5] We also note that lack of counsel is not a ground under Rule 60(b) for setting aside a consent judgment. Briscoe v. Briscoe, 600 So. 2d 290 (Ala.Civ.App.1992); Porter v. Mobile Pulley & Mach. Works, 507 So. 2d 529 (Ala.Civ.App. 1987). Thus, it does not matter that Hines's mistaken understanding as to the effect of the settlement might have been caused by his not consulting an attorney either when he signed the settlement or when he went to court to have the settlement approved.
[6] This was the position Wal-Mart argued to Judge Suttle in its successful effort to have the default judgment in the retaliatory-discharge action set aside.
[7] Rule 4.2, Ala. R. Prof. Conduct, provides: "In representing a client, a lawyer shall not communicate about the subject of representation with a party the lawyer knows to be represented by another lawyer in the matter, unless the lawyer has the consent of the other lawyer or is authorized by law to do so." | eb863373729a2d830717ce1d7b2ecd918db85e892a158d6f1cb7df4146212022 | 1998-09-25 00:00:00 |
b910d8e9-75cc-450e-966c-451adc8d45d4 | Anderson Bros. Chrysler Plymouth Dodge, Inc. v. Hadley | 720 So. 2d 895 | 1961143 | Alabama | Alabama Supreme Court | 720 So. 2d 895 (1998)
ANDERSON BROTHERS CHRYSLER PLYMOUTH DODGE, INC.
v.
Glarin HADLEY.
1961143.
Supreme Court of Alabama.
July 31, 1998.
Paul M. James, Jr., of Rushton, Stakely, Johnston & Garrett, Montgomery, for appellant.
Joseph C. McCorquodale III and Jaqualyn S. Bradley of McCorquodale & McCorquodale, Jackson; and Wyman O. Gilmore, Jr., Grove Hill, for appellee.
COOK, Justice.
Anderson Brothers Chrysler Plymouth Dodge, Inc. ("Anderson Brothers"), appeals from the trial court's order denying arbitration of claims filed against it by Glarin Hadley. We reverse.
On January 3, 1996, Glarin Hadley purchased from Anderson Brothers, an automobile dealership, a used 1993 Chevrolet Cavalier automobile. As part of the negotiations for the sale of the automobile, Hadley signed an arbitration agreement. On November 6, 1996, Hadley filed a four-count complaint against Anderson Brothers: two counts alleged *896 fraud; one count alleged negligence; and one count sought a declaratory judgment regarding the arbitration agreement. On December 5, 1996, Anderson Brothers filed a motion to stay proceedings and to compel arbitration of all claims stated in Hadley's complaint. On December 17, 1996, Hadley filed her response opposing Anderson Brothers' motion. Subsequently, Hadley filed a motion to stay arbitration.
On March 5, 1997, the trial court denied Anderson Brothers' motion to stay proceedings and to compel arbitration. In the same order, the trial court granted Hadley's motion to stay arbitration, for the reasons enumerated in Count IV, Paragraph 6(c), of the complaint. On April 3, 1997, Anderson Brothers sought permission to appeal, pursuant to Ala.R.App.P. 5, and we granted that permission.
(Emphasis added.)
The primary issue before this Court is whether the fact that the name "Anderson Bros CPD" appears on the signature line on the arbitration agreement, but appears there without the signature of a designated agent of Anderson Brothers, renders the arbitration agreement unenforceable. Specifically, Hadley argued that the arbitration agreement is void and unenforceable; the trial court agreed, stating the following in its order of March 5, 1997:
Hadley asserts that the Federal Arbitration Act ("FAA"), 9 U.S.C. § 1-16 provides that arbitration agreements are judicially enforceable, except upon such grounds as exist at law or equity for the revocation of any contract 9 U.S.C. § 2 (1994); Ex parte Williams, 686 So. 2d 1110 (Ala.1996). However, Anderson Brothers asserts that Hadley's claim that the arbitration agreement is void and unenforceable is without merit; it contends that the agreement is within the scope of agreements encompassed by the FAA. Therefore, Anderson Brothers argues, Hadley should be compelled to arbitrate any and all claims, demands, disputes, and controversies between Hadley and Anderson Brothers, including the issue Hadley has raised in this Court.
We first determine whether the trial court properly found the arbitration agreement to be unilateral in nature and unenforceable. The question is whether Anderson Brothers would be bound by the arbitration agreement, given that it was not signed by a designated agent of Anderson Brothers and that the language contained in the body of the agreement refers to it as the "dealer," whereas, the signature line identifies it as the "seller(s)/lessee(s)."
The law in this State is well settled that if a written agreement is ambiguous, then parol evidence is admissible to clarify its terms. Whether a writing is ambiguous is a question of law for the court. Medical Clinic Board v. Smelley, 408 So. 2d 1203, 1206 (Ala. 1981)
The name "Anderson Bros CPD" appears on the line that is designated for the name of the "seller(s)/lessor(s)." Hadley contends that the absence of a signature by a designated agent renders the "signature" "Anderson Bros CPD"invalid, so that the dealership is not bound to the arbitration agreement. In addition, the plaintiff Hadley says that the arbitration clause is not enforceable because the signature line is designated by the words "seller(s)/lessor(s)," whereas the body of the arbitration agreement refers to an agreement between the "buyer/lessee" and the "dealer." For the reasons expressed below, we conclude that the wording of the agreement and that of the signature line create no ambiguity and, thus, that the contract is not unilateral in nature; that is, we conclude that the arbitration agreement is binding on Anderson Brothers.
In Professional Business Systems, Inc. v. Kaufman, 507 So. 2d 421 (Ala.1987), where there was no indication of the capacity in which A.F. Austin signed his name to the contract, this Court held that the initials "AFA," appearing in the body of the contract, clearly referred to a companyA.F. Austin & Associatesand not to the signee A.F. Austin, individually, as the plaintiffs contended. The Court reasoned, considering the entire contract, that the initials "AFA" refer to the company, which, besides the plaintiffs Kaufman, was the only other contracting party, as indicated by the introductory paragraph of the contract. The problem caused by the lack of adequate titles on the signature line in Professional Business Systems is very similar to the problem caused by the absence of a title on the signature line at issue in this case. It is undisputed that no other legal entity is designated on the signature line, and no one contends that "Anderson Bros CPD" is not one and the same as the defendant Anderson Brothers Chrysler Plymouth Dodge, Inc.
According to the signature line on the arbitration agreement, "Anderson Bros CPD" is the "seller/lessor." The language in the body of the agreement describes the transaction as being between the "buyer/lessee" and a "dealer," and it refers to no other party. Therefore, we conclude that the signature "Anderson Bros CPD" is not ambiguous and does not make the arbitration agreement a unilateral agreement on the part of *898 the plaintiff Hadley. That "signature" could refer only to Anderson Brothers. Anderson Brothers is the only legal entity contracting with Hadley, as shown by paragraphs two and three of the arbitration agreement.
Having determined that the arbitration agreement is not unilateral in nature, we now consider whether the trial court correctly denied Anderson Brothers' motion to stay proceedings and to compel arbitration.
Hadley argues that the trial court properly denied Anderson Brothers' motion to stay proceedings and to compel arbitration, and properly granted her motion to stay arbitration. She argues that the arbitration agreement is void and cannot be enforced against her. Hadley contends that the trial court's ruling was a finding in her favor on all of her claims, including the claim that she lacked the capacity to understand the arbitration document; that there was a lack of consideration for the agreement; and that the agreement lacked mutuality because, she contends, only one party signed it. Hadley also argues that if the ruling of the trial court was correct for any reason, even a reason not specified, then it is due to be affirmed. Marvin's, Inc. v. Robertson, 608 So. 2d 391, 393 (Ala. 1992); Yarbrough v. C & S Family Credit, Inc., 595 So. 2d 880, 881 (Ala.1992).
Anderson Brothers argues that the only claim of the plaintiff ruled on by the trial court was the claim stated in Count IV, Paragraph 6(c), of the plaintiff's complaint that the arbitration agreement was not "signed" by Anderson Brothers and thus was "unilateral" and unenforceable. We agree with Anderson Brothers that the trial judge expressly stated that this was his reason for granting Hadley's motion to stay arbitration and that the record contains no evidence to support the order on any other ground. Consequently, this is the ruling from which Anderson Brothers appeals.
The order denying arbitration, based upon Count IV, Paragraph 6(c), is reversed.
REVERSED AND REMANDED.
HOOPER, C.J., and SHORES, HOUSTON, KENNEDY, and LYONS, JJ., concur.
MADDOX and SEE, JJ., concur in the result. | 432a125ff1d669a0cc310d40a9c8e9b084f08b2679eaf4da7d6a23a3c0d54993 | 1998-07-31 00:00:00 |
4548adf9-06b0-4048-a231-d518bc918c13 | City of Birmingham v. Business Realty Inv. Co. | 722 So. 2d 747 | 1961823, 1961889 | Alabama | Alabama Supreme Court | 722 So. 2d 747 (1998)
CITY OF BIRMINGHAM
v.
BUSINESS REALTY INVESTMENT COMPANY, an Alabama Corporation.
Business Realty Investment Company and Rick Bentley
v.
City of Birmingham.
1961823, 1961889.
Supreme Court of Alabama.
September 11, 1998.
*748 Edward E. May and Lawrence Cooper of Edward E. May & Associates, Birmingham, for appellant/cross appellee City of Birmingham.
William D. Jones III and Anthony A. Joseph of Johnston, Barton, Proctor & Powell, L.L.P., Birmingham, for appellees/cross appellants Business Investment Company and Rick Bentley.
KENNEDY, Justice.
This case involves several construction contracts between the City of Birmingham and Business Realty Investment Company ("BRIC").
BRIC is a general contractor. In 1989 and 1990, the City entered into contracts with BRIC by which BRIC was to build several street connectors and sidewalks for the City. United States Fidelity & Guaranty Company ("USF&G") was BRIC's bonding company. USF&G provided the bond on the contracts between BRIC and the City.
*749 On January 16, 1992, USF&G sued BRIC and its president, Rick Bentley, seeking to be exonerated of liability under certain surety bonds it had issued in favor of the City, specifically, liability based on the City's claim that BRIC was in default on one of its contracts (the 24th Street project) and the City's demand that USF&G complete the contract. On August 21, 1992, USF&G filed a motion for summary judgment. The trial court granted the motion as to amounts USF&G actually had paid to the City.
Subsequently, BRIC and Bentley filed a third-party complaint against the City. In their complaint, they alleged that the City had breached five separate construction contracts it had entered into with BRIC. Specifically, those contracts involved the following projects: (1) the 24th Street project; (2) the 11th Avenue project; (3) the 36th Avenue project; (4) the 10th & Jersey Street project; and (5) the Ensley Sidewalk Phase II project. BRIC further alleged, with regard to the 24th Street project, that the City had breached an implied warranty with respect to plans, layout stakes, and instructions; that it had negligently supervised the project; and that it had negligently designed and maintained a sewer drainage system that flooded adjoining property owned by BRIC. BRIC also alleged that the City had intentionally interfered with its business relationship with USF&G. The City generally denied all the allegations and asserted no affirmative defenses.
A jury returned verdicts in favor of BRIC on all five of its breach-of-contract claims, totalling $80,391.69.
The jury also found in favor of BRIC on its claim alleging intentional interference with business relations, awarding damages of $172,500. As to BRIC's claim alleging a breach of implied warranty on the 24th Street project, the jury awarded $48,763.89 in damages to BRIC. The jury also awarded $48,763.89 on BRIC's claim alleging negligent supervision of the 24th Street project. It found in favor of the City on the negligent-design claim related to the 24th Street project. (C.R.806-11.)
The trial court awarded BRIC an additur of $97,527.78 (the amount of USF&G's verdict against BRIC), because the jury failed to include this in its award for the breach of contract on the 24th Street project. The City refused to accept the additur and the trial court ordered a new trial on the implied warranty issue.
The City appealed. It argues that the trial court erred in submitting the intentional-interference-with-business-relations claim to the jury, based on § 11-47-190, Ala.Code 1975. The City argues, in the alternative, that if it is liable, it cannot be liable for more than $100,000 in damages on the intentional-interference claim. The City also argues that the breach-of-implied-warranty and negligent-supervision claims are irreconcilably inconsistent. Last, the City argues that the trial court erred in awarding the additur on the breach-of-contract claim based on the 24th Street contract. On cross-appeal, BRIC and Bentley argue that the trial court erred in limiting Bentley's testimony concerning the damage to BRIC's property adjoining the 24th Street project.
The City argues that it cannot be held liable for intentional interference with business relations because § 11-47-190 limits the liability of municipalities to liability for injuries suffered through "neglect, carelessness or unskillfulness." In Scott v. City of Mountain Brook, 602 So. 2d 893, 894-95 (Ala.1992), we held that "the terms `neglect,' carelessness,' and `unskillfulness,' given their plain meanings, [did not] encompass intentional interference with a business relationship" and that the municipal defendant, therefore, was immune from the claim.
The issue here is whether the City waived its right to use immunity as a defense by failing to raise it in its pleadings or at trial. Rule 8(c), Ala.R.Civ.P., provides that a party must set forth affirmatively any "matter constituting an avoidance or affirmative defense." An "affirmative defense" is defined as a "matter asserted by [the] defendant which, assuming the complaint to be true, constitutes a defense to it." Black's Law Dictionary (6th ed.1990).
In Bechtel v. Crown Central Petroleum Corp., 451 So. 2d 793 (Ala.1984), we held that an employer's immunity provided by the Workers' Compensation Act is an affirmative defense and is subject to the pleading requirements of Rule 8(c). BRIC argues that the municipal immunity provided by § 11-47-190 is an affirmative defense that must be specifically pleaded. In Bechtel, the trial court entered a summary judgment based on the affirmative defense of statutory employer immunity, a defense that was not raised in the defendant's pleadings. We held that the trial court erred, because the language of Rule 8(c) is mandatory and the defendant had never amended its answer to include the defense.[1]
The Court in Kershaw v. Knox Kershaw, Inc., 523 So. 2d 351 (Ala.1988), held that the defendant's failure to plead the affirmative defense of illegality before post-trial motions were filed precluded a consideration of that defense. In State Department of Revenue v. Price-Williams, 594 So. 2d 48 (Ala.1992), we held that the defense of sovereign immunity is an affirmative defense that can be waived if it is not affirmatively pleaded.
Following Bechtel, Kershaw, and Price-Williams, we conclude that the defense of statutory municipal immunity is an affirmative defense that, under Rule 8(c), must be specifically pleaded. Although statutory municipal immunity, like the statutory employer immunity provided by the Workers' Compensation Act and like sovereign immunity, is not specifically listed in Rule 8(c), it quite obviously is of the same nature as those defenses specifically listed there. We must now determine if the City ever raised the defense.
The City did not in its answer plead immunity as a defense. The City never amended its answer to include the affirmative defense of immunity. More than two years after the action was filed, the trial court entered a pretrial order stating that "the filing of any further claims, including counterclaims, crossclaims, third-party claims, amended answers and amended or additional defenses is barred." (C.R.505.) The trial court also ordered that "each attorney was to bring a short written summary of the claims and causes of action and the position of the party such attorney represents." (C.R.506.) In response to this, the City stated *751 that it denied having "intentionally, willfully, or maliciously interfered" with BRIC's business relationship with USF&G. (C.R. 511.) The City never raised the defense of statutory immunity under § 11-47-190. Moreover, the City did not move for a judgment as a matter of law, either at the close of BRIC's case or at the close of all the evidence, and it did not object when the trial court submitted the intentional-interference claim to the jury.[2] The City did file a postverdict motion for a judgment as a matter of law or, in the alternative, a new trial; in that motion, it asserted that "Alabama law prevents any recovery of damages from municipalities on claims of intentional interference with business relations." (C.R.793.)
The City, like any other defendant, must follow the procedural rules. Because the City did not properly raise the defense of immunity, the court properly allowed the claim of intentional interference with business relations to go to the jury. Certainly, matters that could have been foreseen earlier should not be asserted for the first time after trial. A fair trial demands that both parties and the court have the opportunity to address questions of liability and defensive matters in a timely manner. The City had every opportunity to raise the defense of immunity and failed to do so. Consequently, any immunity defense under the Act that might have been asserted with regard to the intentional-interference-with-business-relations claim has been waived.
Now we must address whether the City is limited to $100,000 in damages under § 11-93-2, which provides as follows:
In Macon v. Huntsville Utilities, 613 So. 2d 318 (Ala.1992), a municipal employee sued his former employer, Huntsville Utilities, alleging wrongful termination. The jury awarded the employee $228,658.27. The trial court reduced the award to $100,000 based on § 11-93-2. We reversed, holding that the $100,000 cap did not apply to the amount of damages recoverable against a governmental entity for wrongful termination:
613 So. 2d 318, 319-20 (footnotes omitted).
This Court in Macon went on to define "tangible property" as "corporeal property, that is, `that which may be felt or touched; such property may be seen, weighed, measured, and estimated by the physical senses; that which is visible and corporeal; having substance and body as contrasted with incorporeal property rights.'" 613 So. 2d at 322.
Similarly, in this present case, we conclude that damages based on intentional interference with business relations are not subject to the statutory cap of § 11-93-2. BRIC's right to conduct a business relationship with USF&G, like the right to seek employment, is an intangible property right. Therefore, BRIC is entitled to the entire amount of the jury award for intentional interference with business relations.
The City next argues that BRIC's claims of negligent supervision and breach of implied warranty are irreconcilably inconsistent. However, it offers no authority to support its argument. When an appellant fails to cite any authority for an argument on a particular issue, this Court may affirm the judgment as to that issue, for it is neither this Court's duty nor its function to perform an appellant's legal research. Rule 28(a)(5); Spradlin v. Birmingham Airport Authority, 613 So. 2d 347 (Ala.1993).
With regard to the City's argument that the trial court erred in granting BRIC's motion for an additur, we conclude, again, that the City has not properly presented that argument in its brief. The City did attach to its brief a copy of its motion in opposition to BRIC's motion, which the City filed in the trial court. However, the City did not include in that motion in opposition any evidence indicating that BRIC is not entitled to the additur. Where damages are determined to be inadequate, the court may, in lieu of a new trial and with the consent of the defendant, increase the damages, where the amount to be added is certain. Norman v. Baldwin County, 652 So. 2d 1145 (Ala. 1994). Here, the additur was based on the amount awarded USF&G against BRIC, which in turn prompted BRIC's third-party complaint against the City. At trial, the jury found that this breach of contract, which had caused USF&G to pay on the bond, was the City's fault. The City's brief contains nothing to contradict this amount other than its bare assertion that the jury "obviously included" that amount in its other awards to BRIC. (City's reply brief.)
We find no error in the trial court's exclusion of Bentley's testimony, offered as that of *753 an expert, as to the damage to BRIC's property.
Accordingly, we affirm the judgment of the trial court.
AFFIRMED.
HOOPER, C.J., and MADDOX, HOUSTON, and LYONS, JJ., concur.
ALMON and SEE, JJ., concur in the result.
[1] On remand, the trial court allowed the defendant in Bechtel to amend its answer to assert the affirmative defense of employer immunity. The trial court then entered another summary judgment for the defendant, and the plaintiff again appealed. We concluded that the trial court did not err in allowing the amendment, holding that it was in the court's discretion to do so, under Rule 15, Ala.R.Civ.P. Bechtel v. Crown Central Petroleum Corp., 495 So. 2d 1052 (Ala. 1986). In this present case, however, the City never amended its complaint to include the affirmative defense of statutory immunity.
[2] Under Rule 50, Ala.R.Civ.P., a party must make a preverdict motion for a judgment as a matter of law in order to be entitled later to a postverdict judgment as a matter of law. | 73f670d07661b949f14809991d82f010e8a652011f6fb964ffa8f8587c165f06 | 1998-09-11 00:00:00 |
b653dd0b-6ca8-4e0d-82b9-168c4f80f9cc | Ex Parte Paulk | 722 So. 2d 171 | 1960743 | Alabama | Alabama Supreme Court | 722 So. 2d 171 (1998)
Ex parte McIver L. PAULK et al.
(In re McIver L. Paulk et al. v. Buccaneer Homes of Alabama, Inc., et al.)
1960743.
Supreme Court of Alabama.
August 28, 1998.
Andrew J. Smithart III of Pearson & Smithart, P.C., Tuscaloosa; and Lynn W. Jinks III and L. Bernard Smithart of Jinks, Smithart, Jackson & Daniel, L.L.C., Union Springs, for petitioners.
Robert C. Black and John R. Bradwell of Hill, Hill, Carter, Franco, Cole & Black, P.C., Montgomery; John W. Lowe of Lowe, Mobley & Lowe, Haleyville; and John W. Waters, Jr., of Alley & Waters, P.C., Union Springs, for respondent.
Louis C. Rutland of Rutland & Braswell, L.L.C., Union Springs, for amicus curiae A.C. King d/b/a King's Mobile Homes.
James H. Seale III, Greensboro, for amicus curiae Causey & Graves, Inc.
James M. Galese, Birmingham, for amicus curiae Southern Energy Homes, Inc.
*172 Robert E. Sasser, Dorothy Wells Littleton, and Tamara A. Stidham of Sirote & Permutt, P.C., Montgomery, for amicus curiae Alabama Manufactured Housing Institute, Inc.
Richard H. Monk III of Bradley, Arant, Rose, & White, L.L.P., Birmingham, for amici curiae Champion Home Builders Co., Patriot Homes, Inc., and the Alabama Industry and Manufacturers Ass'n.
COOK, Justice.
The opinion of March 20, 1998, is withdrawn, and the following is substituted therefor.
The plaintiffs, McIver L. Paulk, Thomas B. Paulk, Sr., and Annie Pearl Smith, petition for a writ of mandamus directing Judge William T. Gaither of the Bullock Circuit Court to vacate his order transferring their action from Bullock County to Marion County. We grant the petition.
In August 1994, McIver L. Paulk, a resident of Montgomery County, and Thomas B. Paulk, Sr., a resident of Bullock County, purchased a mobile home in Bullock County from King's Mobile Homes, Inc. ("King"). The mobile home was manufactured by Buccaneer Homes of Alabama, Inc. ("Buccaneer"), located in Marion County. In May 1994, Annie Pearl Smith, a resident of Bullock County, purchased a Buccaneer mobile home from King. Buccaneer sold mobile homes in Bullock County through King, pursuant to a "Dealer Agreement." Buccaneer provided a written warranty covering each mobile home for defects in material and workmanship. On August 25, 1994, King stopped selling Buccaneer mobile homes. On August 4, 1995, the plaintiffs filed a complaint in the Bullock Circuit Court against Buccaneer and several fictitiously named defendants. The complaint alleged breach of warranty and stated two counts of fraud. The plaintiffs sought compensatory damages, including damages for mental anguish arising under the breach-of-warranty claim, and punitive damages under the two fraud claims.
In September 1995, Buccaneer moved to have the action dismissed for improper venue or, alternatively, to have the action transferred to the Circuit Court of Marion County. On November 18, 1996, Judge Gaither granted Buccaneer's motion to transfer the action to Marion County. Buccaneer argues that under Ala.Code 1975, § 6-3-7, venue is proper only in Marion County.
The plaintiffs allege breach of warranty, fraudulent misrepresentation, and fraudulent suppression against Buccaneer, and they seek compensatory damages, including damages for mental anguish, and punitive damages. We must determine whether venue for these claims was proper in Bullock County, where the action was filed, or, as Buccaneer contends, was proper only in Marion County.
Buccaneer is a domestic corporation; therefore, the venue statute to be applied is that portion of § 6-3-7, Ala.Code 1975, relating to domestic corporations. Because we find that there is substantial evidence that misrepresentations were made in Bullock County and substantial evidence that an agency relationship existed between Buccaneer and King, we will pretermit discussion of the breach-of-warranty claim. Therefore, the rule applicable in this case is that rule set out in what we here label as subpart 2 of § 6-3-7:
It is only in personal injury actions against domestic corporations that the legislature, by the proviso contained in § 6-3-7, has limited venue to the county where the injury occurred or the county of the plaintiff's residence if the corporation does business there. See Ex parte Blount, 665 So. 2d 205 (Ala. 1995); Ex parte Townsend, 589 So. 2d 711 (Ala.1991); Ex parte W.S. Newell, Inc., 569 So. 2d 725 (Ala.1990).
The plaintiffs purchased their mobile homes from King in Bullock County. Two of *173 the plaintiffs, Thomas B. Paulk, Sr., and Annie Pearl Smith, reside in Bullock County. On each mobile home manufactured by Buccaneer and sold by King, Buccaneer provided a warranty covering defects in materials and workmanship. Pursuant to the "Retailer Service Agreement" between King and Buccaneer, King was required to present each customer with a copy of the Buccaneer warranty before the retail sales contract was executed and to provide Buccaneer with a completed warranty card stating the customer's name, address, and date of purchase. King was also required to notify Buccaneer of any defects in a Buccaneer home no later than five business days after receiving the service request.
Buccaneer contends that it was not doing business by agent in Bullock County. Specifically, Buccaneer argues that King cannot be its agent because the Dealer Agreement expressly states that no agency relationship exists. Buccaneer also argues that no agency relationship existed between it and King because it had no control over the activity of the dealer. The plaintiffs contend, however, that the Retailer Service Agreement constituted substantial evidence suggesting an agency relationship under which King was Buccaneer's agent for presenting the manufacturer's warranty and for doing warranty repair in Bullock County. This Court stated in Tomlinson v. G.E. Capital Dealer Distributor Finance, Inc., 624 So. 2d 565, 567 (Ala.1993), that a contract term disavowing an agency relationship is not conclusive and will not preclude a finding of an agency relationship if there is independent evidence of a retained right of control. The Retailer Service Agreement provides, among other things, the following:
In Wood v. Shell Oil Co., 495 So. 2d 1034 (Ala.1986), we stated:
495 So. 2d at 1036. This Court in Brown v. Commercial Dispatch Pub. Co., 504 So. 2d 245 (Ala.1987), expressed the principle thus:
504 So. 2d at 246.
This case is conceptually difficult because the result sought to be accomplished by Buccaneer (i.e., the expeditious repair or setup of mobile homes under warranty) is one and the same as the manner in which that result was sought to be accomplished. If King performed repairs expeditiously with service personnel and facilities deemed adequate in Buccaneer's judgment, then it also accomplished the result sought by Buccaneer. King was also under the direct supervision of Buccaneer in that Buccaneer retained the right to terminate the contract if, in Buccaneer's judgment, King did not comply with the terms of the agreement. Thus, the plaintiffs presented substantial evidence indicating that Buccaneer directed the manner in which warranty repairs were to be performed, as well as how they were to be performed, under the Retailer Service Agreement.
The plaintiffs also presented substantial evidence indicating that oral misrepresentations were made to them in Bullock County by a representative of King, at a time when King was acting as an agent of Buccaneer Homes. The plaintiffs presented the affidavit of A.C. King, president of King's Mobile Homes, who stated, in pertinent part:
(Emphasis added.)
The plaintiffs also presented affidavits from Thomas B. Paulk, Sr., Annie Pearl Smith, and McIver L. Paulk. Each of them stated in the affidavit that one of the reasons they purchased a Buccaneer home was the warranty presented to them and explained by Mr. King, who they said they believed was an agent of Buccaneer with knowledge of the intricacies of the Buccaneer warranty. We find that these affidavits present substantial evidence indicating that oral misrepresentations were made by King's Mobile Homes in Bullock County to the plaintiffs in Bullock County at the time of the sale of the mobile homes.
The plaintiffs' fraud claims alleging that King's Mobile Homes, as an agent of Buccaneer, committed fraudulent acts against them in Bullock County are based upon these oral misrepresentations, which occurred in Bullock County. Therefore, under § 6-3-7, venue as to the fraud claims against Buccaneer is clearly proper in Bullock County. Because venue is proper in Bullock County for the fraud claim, it is also proper in that county for the breach-of-warranty claims.
Where venue is proper in more than one county, the plaintiff may elect the forum county and the election stands, unless venue is improper in the chosen forum or the defendant demonstrates that under the doctrine of forum non conveniens the case should be transferred to another county. See Medical Service Administration v. Dickerson, 362 *175 So. 2d 906 (Ala.1978). The plaintiffs elected Bullock County as the forum, and we conclude that Bullock County is a proper forum, given the facts of this case.
Because venue is proper in Bullock County, the trial court incorrectly granted Buccaneer's motion to dismiss the action for improper venue or, alternatively, to transfer it to the Marion Circuit Court. Buccaneer has not shown a clear legal right to have the action dismissed or transferred to the Marion Circuit Court.
The plaintiffs' petition for the writ of mandamus is, therefore, due to be granted. The trial court is directed to vacate the order transferring the cause to the Circuit Court of Marion County and to restore the cause to the docket of the Circuit Court of Bullock County.
APPLICATION OVERRULED; OPINION OF MARCH 20, 1998, WITHDRAWN; OPINION SUBSTITUTED; WRIT GRANTED.
ALMON, SHORES, and KENNEDY, JJ., concur.
HOOPER, C.J., and HOUSTON, J., concur specially.
SEE and LYONS, JJ., concur in the result.
MADDOX, J., dissents.
HOUSTON, Justice (concurring specially).
Section 6-3-7, Ala.Code 1975, provides in pertinent part:
(Emphasis added.) If a person seeks damages for personal injuries in a breach-of-warranty action, as authorized by Ala.Code 1975, § 7-2-715(2)(b), he is suing for damages for personal injuries. Section 6-3-7 refers to "all actions" for personal injuries ("all" means "all," unless we are going to rewrite the statute, which I refuse to do). On original submission, I concluded that the proviso meant that a breach-of-warranty action in which the plaintiff seeks damages for personal injuries must be brought under the proviso. Although the discussion of the breach-of-warranty claim has now been deleted from the opinion on second application for rehearing, I adhere to that conclusion.
Also, on original submission, I concluded that the second prong of the proviso, "does business by agent," has been interpreted by this Court as "was doing business [by agent] in that county at the time the suit was filed." Ex parte Snoddy, 487 So. 2d 860, 861 (Ala. 1986) (Maddox, Jones, Almon, Shores, Beatty, and Adams, JJ., concurring in the per curiam opinion). I joined Chief Justice Torbert's dissent, but the majority opinion created a rule that was not without precedent: Ex parte McGugin, 423 So. 2d 1367 (Ala.1982); Bolton v. White Motor Co., 239 Ala. 168, 194 So. 510 (1940). The trial court found that Buccaneer Homes was not doing business in Bullock County when this action was filed. After reexamining the briefs and the record, I cannot say that the trial court was wrong; therefore, I remain convinced that our writ of mandamus cannot be issued under the second prong of the proviso to § 6-3-7.
Following precedent, Ex parte SouthTrust Bank of Tuscaloosa County, 619 So. 2d 1356 (Ala.1993), I originally concluded that the injury occurred in Marion County, not Bullock County, because the record indicates that the written warranty originated in Marion County. However, after reexamining the complaint, I am now satisfied that the plaintiffs are basing their fraud claims on allegations of acts or omissions that occurred in Bullock County, where the dealer explained the warranty to them. This, I believe, distinguishes this case from Ex parte SouthTrust Bank of Tuscaloosa County. For this reason, I now concur to issue our extraordinary writ of mandamus, under the first prong of the proviso, i.e., "in the county where the injury occurred."
HOOPER, C.J., concurs.
*176 LYONS, Justice (concurring in the result).
I agree that the allegations of the complaint and the affidavits are sufficient, at this stage of the proceedings, to make venue in Bullock County appropriate. However, this Court's discussion of the issues should not go beyond that conclusion, lest that discussion be viewed as barring motions for partial summary judgment that, if granted, would give rise to grounds for a transfer pursuant to Rule 82(d)(2)(B), Ala. R. Civ. P.
SEE, J., concurs. | 893e0b21c1dd0f741350a38926fca883437636f6765d5d34f3f5e596da3f77c8 | 1998-08-28 00:00:00 |
d26a11f6-3be0-407f-a35f-8c54b2abaf63 | James v. State | 723 So. 2d 786 | 1971709 | Alabama | Alabama Supreme Court | 723 So. 2d 786 (1998)
Ex parte State of Alabama.
(Re Joe Nathan JAMES, Jr.
v.
STATE).
1971709.
Supreme Court of Alabama.
October 30, 1998.
Bill Pryor, atty. gen., and A. Vernon Barnett IV, asst. atty. gen., for petitioner.
Bryan Stevenson and Drew Colfax of Equal Justice Initiative of Alabama, Montgomery, for respondent.
KENNEDY, Justice.
The petition for the writ of certiorari is denied.
In denying the petition for the writ of certiorari, this Court does not wish to be understood as approving the Court of Criminal Appeals' holding that it was not reversible error for the trial court to instruct the jury before the parties made their closing arguments. Rule 21.1, Ala.R.Crim.P., provides that "the court shall instruct the jury after the arguments are completed." Additionally, § 13A-5-46(d), Ala. Code 1975, regarding the sentencing phase of death penalty cases:
Giving jury charges after the parties have given their closing arguments allows the trial court the opportunity to be heard last. In this present case, the last thing the jurors heard before beginning their deliberations was the prosecutor stating:
By mandating that the trial court instruct the jury after the closing arguments have been completed, the rule and the statute focus the jurors on the law and the jurors' responsibilities and allows the jurors a time to recover from the purely emotional aspects of the lawyers' arguments before beginning deliberations.
WRIT DENIED.
HOOPER, C.J., and ALMON, SHORES, HOUSTON, COOK, and LYONS, JJ., concur.
SEE, J., concurs in the result. | 757fe2d3d86c72f97e2d3d44556c4dfee231db8f35c821a180014f9e7f1f4484 | 1998-10-30 00:00:00 |
adf58bc6-e57c-408a-b8ff-59bd792f4da0 | Eldridge v. Loftis | 723 So. 2d 562 | 1961193, 1961301 | Alabama | Alabama Supreme Court | 723 So. 2d 562 (1998)
Mary Ann ELDRIDGE, et al.
v.
Deloris LOFTIS, et al.
Deloris Loftis a/k/a Annie Deloris Loftis, et al.
v.
Mary Ann Eldridge, et al.
1961193 and 1961301
Supreme Court of Alabama.
April 10, 1998.
Order Modifying Opinion Modified on Overruling of Rehearing September 25, 1998.
*563 Wallace H. Lindsey III, Butler, for appellants/cross appellees.
Joseph C. McCorquodale III and Jacqualyn S. Bradley of McCorquodale & McCorquodale, Jackson; Joseph W. Hutchinson III, Butler; and Timothy C. Hutchinson, Butler, for appellees/cross appellants.
ALMON, Justice.
The question in this appeal is whether the counterclaimants presented sufficient evidence of a parol gift of real property by a grandmother to her grandson, coupled with adverse possession by the grandson, to overcome a provision of the grandmother's will giving her grandson only a life estate in that same real property. We hold that the grandson received a life estate.
At the time of trial, both the grandmother, Dotsie McAllister, and the grandson, McAllister Loftis, were deceased. Dotsie McAllister died in 1958. By her will McAllister Loftis was to receive a life estate in several tracts of land, including the one on which he lived; that tract was called the "homeplace." The will gave remainder interests to his four children by his first wife, Elizabeth.
McAllister died in 1988. McAllister's children by his wife Elizabeth instituted an eviction action against Deloris Loftis, who was McAllister's second wife and his widow. McAllister's five children by his wife Deloris intervened; Deloris and those children counterclaimed to quiet title in themselves to the homeplace and three other parcels.[1] The circuit court awarded the homeplace to Deloris but denied the other relief sought, effectively holding that Deloris and her children had met their burden of proving a parol gift and adverse possession as to the homeplace but not as to the other three tracts.
In 1950, Dotsie McAllister built a house on the homeplace for McAllister and Elizabeth and their children to live in. In 1953, McAllister divorced Elizabeth and married Deloris. Dotsie McAllister's will included the following provision:
(Emphasis added.) The devise provides further for McAllister's use of the land during his life and then gives the land to Elizabeth's four children, by name, for their lifetimes and then to their heirs.
Dotsie McAllister executed this will in July 1957. The will does not mention Deloris Loftis or any children of McAllister's second marriage, other than as to one item in which one of Deloris's sons takes a part interest. Nevertheless, Deloris and her children claim an interest in the tracts of land at issue on the theory that Dotsie McAllister made a parol gift of the tracts to McAllister Loftis in or about 1950; that he thereupon went into *564 possession of those tracts; that the possession was adverse to Dotsie McAllister; and that his adverse possession ripened into title upon the expiration of either the 10-year period of adverse possession or the 20-year period of prescription.
Deloris and her children claim that McAllister obtained title pursuant to the alleged gift and adverse possession, by virtue of the principle stated in Pendley v. Pendley, 338 So. 2d 405 (Ala.1976). As evidence that Dotsie made a parol gift in 1950, Deloris and her children introduced the written contract relating to the construction of the house; that document includes this notation in Dotsie McAllister's handwriting: "This home is a gift from grandmother McAllister to grandson McAllister Loftis." Other than this writing, the principal evidence of a parol gift was the testimony of Deloris. However, the alleged gift would have taken place at least three years before she married McAllister, and her testimony does not show that she had firsthand knowledge regarding the alleged parol gift of the real property.
In Pendley v. Pendley, 338 So. 2d 405, 406 (Ala.1976), the Court stated the issue thus: "Is possession by the grantee of an oral conveyance, which is invalid to pass title, adverse to the grantor of such conveyance?" The Court held that, because there was evidence that "the father attempted to make an oral conveyance of the 80 acres to his son, C.B.," id., the son's possession was adverse to the father, not permissive, and the son acquired title by adverse possession upon the running of the 20-year prescriptive period.
However, in this case, the devise in Dotsie McAllister's will of a life estate indicates that she had not intended seven years earlier to make an oral conveyance of the homeplace, informally memorialized by the writing on the construction contract. The will is evidence that McAllister Loftis's possession was permissive rather than adverse. As the Court said in Pendley, "`Permissive' denotes retention of title by the owner." 338 So. 2d at 407. Dotsie McAllister's devise of a life estate in her will indicates that she had intended to retain at least some interest in the land and to dispose of that land otherwise than by making a gift to McAllister Loftis in fee simple. The 1950 handwritten notation is consistent with the conclusion that Dotsie McAllister intended a gift of a life estate, and so does not necessarily contradict the will.
The circuit judge who conducted the trial of this action left the bench without rendering a judgment. The district judge who thereafter decided the case had before him only the record that is now before us. In these circumstances, the ore tenus rule does not apply and no presumption of correctness attends the findings of the trial judge. Phillips v. Knight, 559 So. 2d 564, 567 (Ala.1990); Hacker v. Carlisle, 388 So. 2d 947, 950 (Ala.1980); § 12-2-7(1), Ala. Code 1975.
A parol gift of land is ineffective to pass title, but it may create a tenancy at will, which, coupled with adverse possession, may ripen into title in the donee. Pendley, supra; Collins v. Collins, 253 Ala. 288, 44 So. 2d 756 (1950). However, evidence in support of a gift must be clear and convincing. Tierce v. Macedonia United Methodist Church of Northport, 519 So. 2d 451, 459 (Ala.1987); DeMouy v. Jepson, 255 Ala. 337, 51 So. 2d 506 (1951).
To the extent that the handwritten note may be evidence that Dotsie McAllister attempted in 1950 to make a parol gift of the fee in these parcels, its evidentiary value is outweighed by that of the will and the attendant circumstances. The handwritten note is only an informal writing on a contract between Dotsie McAllister and a third party. It is in no respects similar to a deed or any other conveyance and is at most indirect evidence of a then-existing intent to make some sort of gift to McAllister. There is nothing unusual or conclusive in the fact of a grandmother building a house for her grandson on property she owns. There was evidence that Dotsie McAllister had a sophisticated knowledge of property and conveyancing at the time she allegedly attempted to make a parol gift in 1950. For example, in May 1953, she deeded 1,642 acres to McAllister. Also, her will devised seven lots in the town of York to McAllister. The record contained evidence of numerous other real estate transactions by Dotsie McAllister. She knew how to convey real *565 property, so it is unlikely that she would have attempted to convey real property by parol gift.
In contrast to the informal notation on the construction contract, the will is a solemn document requiring deliberate planning and formal execution. See, e.g., Ala. Code 1975, § 43-8-131; Black v. Seals, 474 So. 2d 696 (Ala.1985); First National Bank of Birmingham v. Klein, 285 Ala. 505, 234 So. 2d 42 (1970). A testatrix's intent as shown in her will is not to be lightly defeated. Id. Title to real property is made certain by formal conveyances in writing, recorded in the probate office. See generally Ala. Code 1975, § 35-4-50 et seq. All of these rules and other rules regarding the solemnity of wills weigh heavily against any finding of a parol gift in 1950 in contradiction to Dotsie McAllister's 1957 will. Because the will provides clear, written evidence that Dotsie McAllister in 1957 considered herself to hold title to these properties, the ambiguous writing on the contract with a third party is not sufficient evidence to establish that in 1950 she had intended to part with fee simple title. Furthermore, we find no other significant evidence in the record that is sufficient to support a finding that in 1950 Dotsie McAllister had intended to relinquish title by a parol gift.
Because the evidence does not support a finding that Dotsie McAllister intended to relinquish title in 1950, we must conclude that McAllister Loftis's possession was not adverse to Dotsie McAllister, but was permissive. Before her death, he lived on, cut timber from, and farmed the land, all with her knowledge and permission. After her death, he possessed and used the land as a life tenant, and not adversely to his first four children, the holders of a remainder interest. A life tenant cannot possess adversely to a remainderman. Sims v. Sims, 502 So. 2d 722 (Ala.1987).
Alternatively, even if we viewed the evidence as supporting a finding of a parol gift in 1950, the probate of the will in 1958 cut off any adverse possession that later might have ripened into title in McAllister Loftis.
Collins v. Collins, 253 Ala. 288, 290, 44 So. 2d 756, 758 (1950) (emphasis added). Therefore, even if we considered the evidence as proving that Dotsie McAllister attempted to make a parol gift of the land in 1950, the tenancy at will created thereby would have been terminated in 1958 by the probate of her will. This date would be before any adverse possession by McAllister Loftis would have ripened into a fee simple title.[2]
There is even less evidence of any parol gift of the parcels of land other than the homeplace. Deloris and her children have cross appealed from the judgment insofar as it failed to grant them title to those parcels. In that respect, the judgment is affirmed.
For the foregoing reasons, the judgment is affirmed to the extent that it denied relief to Deloris Loftis and her children on their counterclaim, and it is reversed to the extent that it granted them title to the homeplace.
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.
HOOPER, C.J., and MADDOX, SHORES, HOUSTON, KENNEDY, COOK, SEE, and LYONS, JJ., concur.
ALMON, Justice.
In their application for rehearing, Deloris Loftis and her children argue that the will *566 does not actually describe the homeplace. However, the inconsistency in the descriptions of the land is a self-correcting typographical error because the will described the homeplace as being in Township 12 North rather than in Township 13 North, where the property is actually situated. No issue was made at trial pertaining to this discrepancy, and, in fact, counsel for Deloris and her children stipulated that there was no disagreement as to the properties that are at issue in this case, stating:
Although such discrepancies might pose problems in cases where successors in interest have relied on record title, such a situation is not present in this case, because all the parties were familiar with each other and with the property, and because the nature of the title that McAllister Loftis took from Dotsie McAllister did not come into question until this action was filed.
OPINION OF APRIL 10, 1998, MODIFIED; APPLICATION OVERRULED.
HOOPER, C.J., and MADDOX, SHORES, HOUSTON, KENNEDY, COOK, SEE, and LYONS, JJ., concur.
[1] Deloris's children claim an interest because, in 1985, McAllister and Deloris Loftis executed deeds purporting to convey the parcels in issue to these five children, retaining life estates in themselves.
[2] Deloris and her children assert that they submitted evidence indicating that Dotsie had made a parol gift of the land as early as 1947. There was complex and conflicting evidence that tenants on the parcels paid rents either to Dotsie McAllister or to McAllister Loftis. We find no clear and convincing evidence that Dotsie McAllister made a parol gift of any of these tracts of land in 1947 or at any time thereafter. | 8212ddd6b52f2a0a5853914123bc02c61c30bc37ea73a33c0d4b03f75fb5b06f | 1998-09-25 00:00:00 |
f418e95f-1b0a-4f72-be68-f53af27af2ee | Dunlop Tire Corp. v. Allen | 725 So. 2d 960 | 1941845 | Alabama | Alabama Supreme Court | 725 So. 2d 960 (1998)
DUNLOP TIRE CORPORATION
v.
Mickey ALLEN.
1941845.
Supreme Court of Alabama.
October 2, 1998.
Rehearing Denied November 20, 1998.
*961 D. Edward Starnes III and Jeffrey T. Kelly of Lanier Ford Shaver & Payne, P.C., Huntsville, for appellant.
Jimmy Alexander and Robert M. Baker of Alexander, Corder, Plunk & Baker, P.C., Athens, for appellee.
SHORES, Justice.
Mickey Allen filed a retaliatory-discharge action against Dunlop Tire Corporation (hereinafter "Dunlop") pursuant to Ala.Code 1975, § 25-5-11.1, claiming that his employment with Dunlop had been terminated solely because he had instituted an action against Dunlop to recover workers' compensation benefits. After a trial on the merits, the jury returned a verdict for Allen, awarding him $65,000 in past damages, $735,000 in future damages, and $1.2 million in punitive damages. Dunlop appealed the trial court's denial of its alternative motions for a JNOV, for a new trial, for a remittitur of the compensatory damages award, or to alter, amend, or *962 vacate the judgment. On April 24, 1998, the plaintiff moved this Court to "reduce and remit the award of punitive damages awarded in the trial court from $1.2 million to $250,000, being a total remittitur of $950,000.00 from the award of punitive damages."
First, Dunlop argues that it is entitled to a new trial because three members of the jury venire, who were eventually selected as jurors, failed to disclose on voir dire examination that they had been involved in previous litigation. The trial court, in exercising its discretion, determined that the jurors' failure to respond had resulted in no actual prejudice to Dunlop. A reversal based on Dunlop's contention requires a showing of probable prejudice, and we will reverse only if the trial court abused its discretion. Land & Associates, Inc. v. Simmons, 562 So. 2d 140 (Ala.1989).
The trial court held an extensive hearing on this issue, and it was in the best position to determine whether probable prejudice occurred as a result of the jurors' failure to respond to questions during voir dire. Land & Associates, 562 So. 2d at 149. Under the facts of this case, we cannot say that the trial court abused its discretion by finding that Dunlop was not prejudiced as a result of what the court considered a misunderstanding, on the part of the jurors, of Dunlop's questions. Their failure to respond was clearly due to confusion over the questions and inadvertence, and was not due to willfulness or an attempt at falsification. We also find that the trial court's use of the term "actual prejudice," instead of probable prejudice, is not reversible error, because the record showed no evidence of prejudice, either actual or probable, to Dunlop.
Dunlop next contends that the trial court should have granted its motion for a JNOV, because, it argues, Allen had failed to present substantial evidence in support of his retaliatory-discharge claim. Reviewing Dunlop's contention requires us to apply the same standards the trial court applied when it ruled on the motion. Motion Industries, Inc. v. Pate, 678 So. 2d 724 (Ala.1996). Like a motion for a directed verdict presented during trial, a JNOV motion challenging the sufficiency of the evidence is appraised by applying the "substantial evidence rule." § 12-21-12(a), Ala.Code 1975; Med Plus Properties v. Colcock Constr. Group, Inc., 628 So. 2d 370, 373-74 (Ala.1993). The ultimate question is whether the party bearing the burden of proof presented substantial evidence in support of its position. Med Plus Properties, 628 So. 2d at 373-74, citing § 12-21-12(d), Ala.Code 1975. "`Substantial evidence' is `evidence of such weight and quality that fair-minded persons in the exercise of impartial judgment can reasonably infer the existence of the fact sought to be proved.'" Id., quoting West v. Founders Life Assurance Co. of Florida, 547 So. 2d 870, 871 (Ala.1989). Our analysis requires us to review the evidence in a light most favorable to the party who secured the jury verdict and to consider the reasonable evidentiary inferences that the jury could have drawn. Carter v. Henderson, 598 So. 2d 1350, 1353 (Ala. 1992).
Ala.Code 1975, § 25-5-11.1, provides:
Initially, we note that the legislature's purpose in enacting this section was to offset the harsh effects of the employment-at-will doctrine. Morgan v. Northeast Alabama Regional Medical Center, 624 So. 2d 560 (Ala. 1993). Because this is remedial legislation, intended to prevent instances of retaliatory discharge, "we apply the rule that the statute is to be construed liberally to effect its purposes." Twilley v. Daubert Coated Products, Inc., 536 So. 2d 1364, 1367 (Ala.1988). In Twilley, 536 So. 2d 1364, 1369 (Ala.1988), the Court interpreted this section as it regards the prohibition against discharging an employee "solely" because the employee has made a workers' compensation claim. Culbreth v. Woodham Plumbing Co., 599 So. 2d 1120, 1122 (Ala.1992). The Twilley court established the following test:
Twilley, 536 So. 2d at 1369. The Court of Civil Appeals has added:
Beaulieu of America, Inc. v. Kilgore, 680 So. 2d 288, 296 (Ala.Civ.App.1996). Chesser v. Mid-South Electrics, Inc., 652 So. 2d 240, 242 (Ala.1994).
Under the facts presented here, the trial court correctly submitted the issue to the jury. Chesser v. Mid-South Electrics, Inc., 652 So. 2d 240, 242 (Ala.1994). The court determines initially whether the employee has presented substantial evidence from which a jury could conclude "that he was `terminated' because he sought to recover [workers'] compensation benefits," Twilley, supra. The employee cannot leave that as an assumption for the court to make. See Hayden v. Bruno's, Inc., 588 So. 2d 874 (Ala. 1991); Ala.Code 1975, § 12-21-12(a).
In Culbreth, supra, this Court elaborated on its holding in Twilley, addressing the method to follow after the employee has established a prima facie case:
Culbreth, 599 So. 2d at 1122 (citations omitted). In other words, after the plaintiff makes out a prima facie case, the defendant must present, by substantial evidence, Ala. Code 1975, § 12-21-12(a), a legitimate reason for the termination, sufficient to establish that there is no genuine issue as to that fact and that the defendant is therefore entitled to a judgment as a matter of law. Rule 56(c)(3), Ala. R. Civ. P. Only if the defendant satisfies this burden does the plaintiff have to produce enough evidence to refute that showing. Culbreth, 599 So. 2d at 1122; Motion Industries, Inc. v. Pate, 678 So. 2d 724 (Ala. 1996).
The evidence, viewed in a light most favorable to Allen, Carter, supra, tends to show the following: Allen began working at Dunlop in 1975. On August 20, 1982, Allen injured his left shoulder while working as a tire builder. He was off work intermittently and received workers' compensation benefits for two years. Having been medically disqualified from the tire-building position, he was assigned to a position as a machine cleaner.
On March 24, 1988, Allen injured his left knee while working as a machine cleaner. He was off work most of the time until February 12, 1990. During that period, he received workers' compensation benefits. In September 1988, Dr. Howard Miller performed arthroscopic surgery on Allen's knee. The surgery revealed a condoral fracture around the knee cartilage. Dr. Louis Horn concluded that Allen had a knee strain, chondromalacia of the patella, and crepitation. On February 15, 1989, Dr. Robert Mitchell performed surgery on Allen's knee in order to shave and smooth loosened cartilage that was affecting the injured area.
*964 From February through March 21, 1990, Dr. Mitchell treated Allen for complaints of swelling, soreness, and pain due to both the injury and the consequential reduction in muscle mass in Allen's left leg. Dr. Mitchell provided steroid injections to reduce the swelling and the pain and had Allen regularly attend physical therapy sessions to increase strength in the knee joint. Dr. Miller again examined Allen's knee on March 2, 1989. He agreed that Allen had a permanent partial impairment to the knee that was consistent with Allen's complaints throughout his treatment. Allen's injury had put him on crutches until July 1989; after postoperative treatment had improved his ability to extend his leg, Allen began using a cane to help his mobility. On August 16, 1989, Allen returned to work at Dunlop under a restricted, light-work status. On February 7, 1990, Dr. Mitchell felt that Allen was ready to return to his regular work activity. A good physical therapy report had shown full motion through the knee, with no swelling. Dr. Mitchell felt that Allen had a 20% permanent partial impairment of his left leg. Allen returned to his regular work activity, with restrictions, on February 12, 1990.
In June 1991, Allen received an injury not related to his work, a fractured ankle. He was out of work until September 17, 1991, when he returned to his past position as a tire builder. On March 27, 1992, Allen left that job because of foot problems not related to his work. On June 27, 1992, he returned to work again as a tire builder.
On August 21, 1992, Allen slipped in oil while working as a tire builder and reinjured his left knee. For this injury, Allen received workers' compensation benefits from August 21 to November 30, 1992. Dr. Davis, Dunlop's plant doctor, referred Allen to Dr. Horn, an orthopedic surgeon, who performed arthroscopic surgery on Allen's knee in October. The surgery revealed significant changes in the cartilage surrounding the knee, and revealed fragments of cartilage floating in the injured area. Dr. Horn used a small drill to remove some of the damaged cartilage. An MRI revealed that a small surface area of Allen's knee had developed a circulatory impairment. This circulatory impairment had caused a small portion of bone in his knee to die, and this condition further impaired the circulation to the knee. Dr. Horn testified that this condition is normally caused by trauma. On November 30, 1992, Dr. Horn, concluding that Allen had reached maximum medical improvement, considering his previous permanent physical impairment, released Allen to return to work, with no physical restrictions. Despite this fact, Dr. Horn did acknowledge that Allen clearly had suffered an anatomical injury of "functional significance," which, in his opinion, caused an estimated 7% impairment of Allen's leg.
Allen returned to work as a tire builder; the record establishes that this job is one of the hardest jobs at Dunlop. After about five hours of work, Allen reported to the plant nurse that he was experiencing pain and swelling in his knee. The nurse made Allen an appointment with Dr. Horn for the following day and iced down his leg. The nurse told Allen that he had to return to his job, but that, until the appointment, he could have ice applied to his leg three times a day. On December 2, 1992, Allen went to see Dr. Horn. Allen claims, however, that Dr. Horn did not examine his knee; that he merely stuck his head in the door and did not look at, or touch, his knee; and that the nurse returned to tell Allen, pursuant to Dr. Horn's directive, that he was to return to work. Dr. Horn's notes reflected that Allen would have "probable continued problems." At this point, Allen alleges, because Dr. Horn did not even examine his knee, he became very dissatisfied. For this reason, he requested that the nurse provide another physician to examine his knee. As a result, Dr. Davis, who is the plant doctor and a specialist in his field, examined Allen on December 3, 1992. His notes reflected Allen's comments that his left knee was making work unbearable. The notes stated that the pain existed when the leg was fully extended. Dr. Davis prescribed a "job change with no prolonged standing, walking, or climbing." Dr. Davis advised Allen that he could give the injury more time to resolve itself, or make a panel selection for another orthopedist.
Dunlop moved Allen from the tire-building job to a job performing light-duty work in *965 the plant's tire-repair area. Allen was assigned to work as a SRI Apex machine operator for a 12-hour shift; that work required climbing a three-step ladder 25-40 times per shift. Allen claims that Dunlop had jobs on 4 or 5 SRI machines that did not involve climbing, but that Dunlop did not assign Allen to any of those jobs. On February 22, 1993, Allen visited a non-Dunlop orthopedist, Dr. Bacon, who told him to limit his work activity to an 8-hour day, and a 40-hour week, with no squatting, climbing, or kneeling, and no climbing stairs for 2 months; however, the jobs at Dunlop were based on 12-hour shifts. Nevertheless, Dunlop did not consider Dr. Bacon as the treating physician, so it did not follow these restrictions.
Despite Dunlop's knowledge of Dr. Davis's restrictions, which prohibited climbing, and Dr. Bacon's restrictions, Allen began the job as an SRI Apex machine operator on February 23, 1993, a job that required him to climb three stairs about 25 to 40 times during his shift. On February 26, Allen filed a claim for workers' compensation benefits for his prior, August 1992, injury. The next day, February 27, Allen reinjured his left knee while descending the steps of the ladder of the SRI Apex machine. Allen reported the injury to the plant nurse, who "wrote it up" and sent Allen back to perform his job. Allen testified that he attempted to return to the nurse on the following day, February 28, but that his immediate supervisor, Robert Rogers, informed him that he could not see the nurse or go to the first aid office, and was to continue working. Allen did continue working; he stated that he was not allowed to see the nurse during February or March.
The note had Rogers's name at the top of it and the initials "R.R." on the bottom of it.
On May 10, 1993, Allen saw Dr. Bacon. Dr. Bacon testified that Allen's last cortisone injection had provided two weeks of relief from the pain and the swelling, but that his symptoms had now recurred and had been aggravated by his activity level. Dr. Bacon again gave him restrictions to do only light work, with no squatting, kneeling, or crawling; to avoid stairs; and to work only eight-hour shifts for a period of three months. On May 19, 1993, Allen delivered a certified *966 letter to Dunlop stating his dissatisfaction with Dr. Horn and again requesting a panel selection of physicians.
On May 28, 1993, Allen was called into a meeting with one of his supervisors, David Bell, who informed Allen that Dunlop was suspending him without pay while it reviewed his record as an employee. Dunlop's reason for the suspension was that Allen had been placed in a job within the qualifications set by Dr. Horn, but had been unable to perform the assigned Job. Rick Ledsinger testified that the main reason for the suspension was Mickey Allen's "walking off the job." Mr. Bell added that their concern was whether Allen could, or wanted to, work at Dunlop. At the meeting, Max Wright, Allen's union representative, requested an opinion from another doctor as to whether Allen should have performed the job operating the SRI Apex machine in the first instance, but Dunlop refused.
In July 1993, Allen was hospitalized three days for two surgical proceduresarthroscopic surgery and tibial osteotomy, a procedure in which the doctor, in this case, Dr. Bacon, cuts the tibia (the bone below the kneecap) to realign the knee and to shift stress off the injured parts. After the surgery, Allen's left leg was placed in a whole-leg cast for 5-6 weeks and then placed in a smaller cast or brace that extended from his knee to his ankle.
On September 17, 1993, Dunlop notified Allen that he was terminated for "failing to make proper effort to perform [his] assigned job, exaggerating [his] degree of alleged disability, and malingering." In November, a "grievance meeting" was held between Dunlop and Allen's union. As a result of this meeting, Allen was supposedly "reinstated" at Dunlop and was paid sickness and accident benefits of $275 a week for one year through an insurance policy. At Dunlop's request, in June 1994 Allen saw Dr. Keith Anderson, who agreed with Dr. Bacon's limitations (except for the eight-hour-shift limitation), stating that although Allen was experiencing pain he could work a 12-hour shift with no squatting, climbing, or kneeling, and with no stair climbing for two months. Dr. Anderson stated that the goal would be to put Allen back to work to see if he functioned well; if so, Dunlop could increase his work activities. Allen claims that while there were jobs at Dunlop that he could have performed, such as clerical positions, Dunlop never again allowed him to return to work. Dunlop argues that Allen failed to return to work because there were no jobs that conformed to his physical limitations.
The first question is whether Allen presented substantial evidence from which a jury could conclude that he was terminated because he sought to recover workers' compensation benefits. Twilley, supra. We find that Allen did meet this burden. He presented substantial evidence to support his claim of retaliatory discharge, by presenting evidence of circumstances suggesting that the termination came in response to his having sought workers' compensation benefits.
Clearly, putting Allen into a position that eventually caused his termination was wrongfulhis job required him to climb a three-step ladder 25-40 times per shift; this climbing violated the limitation imposed by Dr. Davis, a Dunlop specialist, who had stated that Allen was to do "no climbing." When it allowed Allen to work as an SRI Apex machine operator, Dunlop had the findings of the arthroscopic surgery performed by Dr. Horn, which showed broken fragments of cartilage in Allen's knee, and it had the MRI, which showed a circulatory impairment. These facts, in addition to Dunlop's actively keeping Allen from seeking medical aid, taken in light of a "functionally significant" injury to his knee that impaired at least 7% of his entire left leg, showed a total lack of concern for Allen's safety. A jury could find that this progressive pattern of conduct, by which Allen was eventually terminated and was arguably prevented from reinstatement, supported Allen's allegation that he was really terminated solely because he had filed several claims for workers' compensation benefits. Therefore, we find that Allen established a prima facie case of retaliatory discharge.
Because Allen established a prima facie case, the burden shifted to Dunlop to present substantial evidence indicating that it had a legitimate reason for the termination, evidence *967 sufficient to establish that there was no genuine issue as to that fact and that Dunlop was therefore entitled to a judgment as a matter of law. Rule 56(c)(3), Ala. R. Civ. P; Culbreth, 599 So. 2d at 1122; Motion Industries, Inc. v. Pate, 678 So. 2d 724 (Ala. 1996). The evidence in the record does not tend to support the three reasons offered by Dunlop for terminating Allen: 1) failure to make a proper effort; 2) exaggeration; and 3) malingering.
While Allen was working as an SRI Apex machine operator, his performance was significantly better than that of his more experienced coemployees. According to the record, Allen's average performance percentage as an SRI Apex machine operator for the time before his suspension was 72%. During this period, Allen was new to the position, had an injured knee, and had left early from only one shift because of his injury. By contrast, the average performance percentage for the other SRI Apex machine operators during this period was only 58%. For each shift, Allen was either the top performer or one of the top performers, except for the shift in which he reinjured his knee. No employee during this period was terminated for maintaining a low production percentage, even though some employees' percentages ranged from 65% to 23%, or 57% to 38%. Allen, on the other hand, kept his rate above 70% for the most part, reaching 91% at his peak, and dropping to 35% on the day he reinjured his knee. Consequently, it cannot be said that Allen failed to make a proper effort at his job. His gradual decline in performance was not due to inadequate or improper effort, but, as Allen testified, was due to the worsening of his injury that occurred as time progressed.
With respect to Dunlop's contention that Allen was exaggerating the degree of his disability and was malingering, the record does not support Dunlop's contention. Dunlop's medical staff agreed that Allen had a permanent partial disability to his left leg. Dr. Mitchell went so far as to conclude that the leg had a permanent partial impairment of 20%. Allen had arthroscopic surgeries and an MRI test, which revealed a chrondral fracture, cartilage damage, cartilage fragmentation, and dead bone in the knee. After two surgeries, one to shave portions of the cartilage and another to remove cartilage fragments, Allen had to have his tibia cut and his knee realigned. Accordingly, the opinions of Dunlop's doctors clearly acknowledged that Allen's complaints of pain were consistent with his injury. In light of the objective medical findings and the remedial surgeries, we cannot say that the record contains substantial evidence sufficient to support Dunlop's contentions that Allen was faking and exaggerating the degree of his disability. Rather, we find that "the plaintiff's prima facie case is strong, and the defendant's evidence of an asserted reason is weak or equivocal." Culbreth, 599 So. 2d at 1122 (citations omitted). Assuming that Dunlop had satisfied the directed verdict standard established by the Court in Culbreth, Allen had, nevertheless, presented substantial evidence to rebut the reasons proffered by Dunlop. We therefore hold that the trial court properly denied Dunlop's JNOV motion.
Dunlop next argues that the trial court erred by excluding from evidence the judgment entered on Allen's workers' compensation claim. "The decision to admit or to exclude evidence is within the discretion of the trial judge, and [this Court] will not reverse such a decision absent an abuse of discretion." City of Birmingham v. Moore, 631 So. 2d 972, 974 (Ala.1994). Further, "the mere showing of error is not sufficient to warrant a reversal; it must appear that the appellant was prejudiced by that error." Id. at 973-74, citing Rule 45, Ala.R.App.P.; see also Industrial Risk Insurers v. Garlock Equip. Co., 576 So. 2d 652, 658 (Ala.1991); Preferred Risk Mut. Ins. Co. v. Ryan, 589 So. 2d 165, 167 (Ala.1991). At the time of the trial in this present case, Allen's workers' compensation case was pending on appeal in the Court of Civil Appeals. The trial court ruled that while evidence relating to the workers' compensation claim was irrelevant and might mislead the jury, Dunlop could introduce evidence of the amount of the benefits awarded to Allen and that evidence of conflicting testimony offered in the workers' compensation case could be introduced for purposes of impeachment. We conclude that *968 this ruling by the trial court did not amount to an abuse of discretion and, therefore, that the trial court did not err by excluding from evidence the judgment entered on Allen's workers' compensation claim.
Dunlop next argues that the trial court erred in charging the jury with respect to lost wages. In Volkswagen of America, Inc. v. Marinelli, 628 So. 2d 378 (Ala.1993), this Court stated:
628 So. 2d at 384-85. Rule 51 provides, in pertinent part:
We conclude that trial court's charge substantially and fairly covered the same principles as the instructions that Dunlop says the trial court should have given. Accordingly, we find no error in the record with respect to this contention.
Dunlop next contends that the jury's award of $735,000 in future damages was not authorized by the trial court's instructions. As required by Ala.Code 1975, § 6-11-3, the trial court used a verdict form that itemized damages by listing a separate space for past, future, and punitive damages. Dunlop did not object to the provision for future damages on the verdict form. The trial court instructed the jury that "[t]he form which you would use, if you reach a verdict for the plaintiff, has a place for past damages, future damages, punitive damages, and a total of all of them."
Because the verdict form on its face had a place for future damages if, according to the trial court, the jury reached a verdict for the plaintiff, we conclude that the jury was authorized to award future damages. The jury did not violate the trial court's instructions. Moreover, if Dunlop had thought that future damages were not recoverable in this action, it should have asked to have that category omitted from the itemization. See Ala.Code 1975, § 6-11-3.
That portion of the judgment awarding compensatory damages ($65,000 in past damages and $735,000 in future damages) is affirmed. Because the plaintiff presented no clear and convincing evidence that Dunlop acted with oppression or malice, the award of punitive damages is reduced to $0. If the plaintiff does not, within 28 days of the date of this opinion, file in this Court a remittitur of $1.2 million, then the defendant shall be granted a new trial.
AFFIRMED CONDITIONALLY.
ALMON, KENNEDY, and COOK, JJ., concur.
HOUSTON and LYONS, JJ., concur specially.
HOOPER, C.J., and MADDOX, J., dissent.
SEE, J., dissents and files statement of nonrecusal.
HOUSTON, Justice (concurring specially).
The majority opinion addresses what the appellant, Dunlop Tire Corporation, argues in its brief as its fifth contentionthat "the trial court erred in denying Dunlop's motion for JNOV, because Allen failed to prove by substantial evidence that he was terminated solely because he filed a claim for workers' compensation benefits." See Appellant's brief, pp. 54-62.
Dunlop's brief sets out the text of the termination letter given by Dunlop to Allen on September 17, 1993:
At trial, Dunlop presented evidence indicating that the reasons stated in this letter were its reasons for terminating Allen. Rick Ledsinger, Dunlop's personnel manager, testified that Allen "was terminated for withholding efforts to perform his job, ... was terminated for exaggerating the extent of his injury [, and] was terminated for malingering." Appellant's brief, p. 56. There is evidence from which the trier of facts could infer that all of this was true. However, there is also substantial evidence indicating that Allen did not withhold efforts to perform his job, that he did not exaggerate the extent of his injury, and that he did not malinger. See the statement of facts in the majority opinion.
Who resolves these issues, under our law and our standards of review? The trial court? This Court? Or the entity that Allen had demanded as his trier of factsthe jury? Under our law and our standards of review, it has been, and still is, according to the majority opinion in this case, the jury.
I do not disagree with any of the law cited in Justice See's dissent. Two other Justices and I, who are concurring in the majority opinion, concurred in Harrison v. Southern Pine Electric Cooperative, 603 So. 2d 1004 (Ala.1992). Four other Justices and I, who are concurring in the majority opinion, concurred in Smith v. Dunlop Tire Corp., 663 So. 2d 914 (Ala.1995). These cases are distinguishable from this present case. Here, material issues of fact had to be resolved by the trier of facts. In Harrison and Smith there were no material issues of fact to be resolved by the trier of fact.
LYONS, Justice (concurring specially).
An employee must prove both a willingness and an ability to return to work, in order to establish a retaliatory dismissal from employment because of the employee's seeking workers' compensation benefits. Recent decisions of the Court of Civil Appeals have described the ability to return to work as an essential element of a retaliatory-discharge claim. See, e.g., Hammock v. Ryder Dedicated Logistics, Inc., 716 So. 2d 215 (Ala. Civ.App.1998); Rice v. Bruno's, Inc., 705 So. 2d 486 (Ala.Civ.App.1997); Watwood v. White Consol. Indus., Inc., 699 So. 2d 210 (Ala.Civ.App.1997); Lambert v. Beverly Enterprises, Inc., 695 So. 2d 44 (Ala.Civ.App. 1997); Consolidated Stores, Inc. v. Gargis, 686 So. 2d 268 (Ala.Civ.App.), cert. denied, 686 So. 2d 278 (Ala.1996). Because Allen's physician at the time of his discharge, Dr. Bacon, had restricted Allen to working only 8 hours per day, Allen offered evidence that he was not able to return to work at Dunlop, where employees are required to work 12-hour shifts. Allen also testified to his inability to return to work. However, as the majority opinion states, there was also evidence of Allen's ability to return to work.
In order to prevent this inconsistent evidence from creating a jury question, we would have to hold that Allen was judicially estopped from assuming a position inconsistent with that evidence that suggested he was unable to return to work. This we have not been asked to do.
HOUSTON, J., concurs.
SEE, Justice (dissenting).
I respectfully dissent. In my view, Mickey Allen failed to present substantial evidence indicating that Dunlop Tire Corporation ("Dunlop"), his employer, discharged him solely for filing a workers' compensation claim.
Viewed in the light most favorable to Allen, the evidence suggests that during Allen's 18-year employment with Dunlop he suffered a number of injuries. After injuring his shoulder working as a tire builder in 1982, Allen filed for and received workers' compensation benefits. He was absent from work intermittently for a two-year period, but Dunlop did not terminate Allen's employment at that time. After injuring his left knee at work in 1988, Allen filed for and received workers' compensation benefits. He was absent *970 from work during most of the next two years, but Dunlop did not terminate Allen's employment at that time. After suffering non-work-related injuries to his ankle and foot in 1991 and 1992, Allen was absent from work for several months, but Dunlop did not terminate Allen's employment at that time.
In August 1992, Allen suffered the injury that is the subject of this dispute. He reinjured his left knee when he slipped after stepping in oil. As a result of this injury, Dr. Louis Horn, Allen's treating physician, performed arthroscopic surgery on Allen's knee. Allen filed for and received workers' compensation benefits and was absent from work for several months, but Dunlop did not terminate Allen's employment at that time.
In December 1992, Allen returned to work with no medical limitations imposed by Dr. Horn. After working only a short time, Allen complained of pain. Dunlop's plant doctor, Dr. Jan Davis, recommended that Allen be moved to light-duty employment that did not require "prolonged standing, walking, [or] climbing." (Emphasis added.) Dunlop reassigned Allen from the tire-building job to that of SRI Apex machine operator"one of the easiest jobs in the plant"after Dr. Davis inspected and approved the SRI work site for Allen. Operating his SRI Apex machine, Allen could sit for most of his 12-hour shift and had to climb only three stairs approximately three times per hour during the shift. Dunlop provided Allen with a stool that was designed to allow the operator to control the machine by using his right foot.
Without informing Dunlop, Allen sought the services of a third physician, Dr. John Bacon.[1] Dr. Bacon placed restrictions on Allen, prohibiting him from doing any squatting, climbing, or kneeling, and from working more than an 8-hour shift. Dunlop is a 12-hour-per-shift facility.
Faced with statements by two physicians, Dr. Davis and Dr. Horn, that Allen could perform the SRI Apex machine operator's job, and a statement by one physician, Dr. Bacon, that Allen could not, Dunlop had Allen report to his light-duty job as an SRI Apex machine operator. Allen started performing that light-duty job on February 23, 1993. Three days later, he filed a workers' compensation claim for his August 1992 knee injury. The following day, February 27, Allen alleged that he reinjured his knee while descending the three-step ladder on his SRI Apex machine.
Allen performed his light-duty employment without complaint until April 1993, when he complained of increased pain. On May 7, against the instructions of his supervisor, Allen walked off the job. Then, on May 28, after Allen had experienced numerous injuries; after nearly five years of total prior absences over an 18-year employment history, counseling regarding absenteeism, declining performance on the SRI Apex machine operator's job;[2] and after Allen had asserted that he could not perform his SRI Apex machine operator's job, even though it was the opinion of two physicians that he could, Dunlop finally suspended Allen, without pay. Dunlop told Allen that he was being suspended because (1) he had been placed in a job within his qualifications and had failed to perform that job, and (2) he had walked away from the job site, against the instructions of his supervisor. Dunlop instructed Allen that during his term of suspension it would evaluate his employment record to determine whether it would terminate his employment.
In July 1993, Dr. Bacon performed surgery on Allen's left knee, but Allen did not inform Dunlop of this surgery. Unaware of the surgery, Dunlop decided to terminate Allen. This decision was based on Allen's entire employment record, his diminishing performance, and his walking off the job *971 despite the medical opinions of Allen's treating physician, Dr. Horn, and the plant physician, Dr. Davis, that he could perform the SRI Apex machine operator's job. On September 17, members of Dunlop management met with Allen to inform him of the decision to terminate his employment for "failing to make proper effort to perform [his] assigned job, exaggerating [his] degree of alleged disability, and malingering." At the September 17 meeting, however, Allen arrived, with a cast on his leg, and announced that Dr. Bacon had performed surgery on his knee. Allen stated that he wanted to return to work. Accordingly, after a grievance meeting among Dunlop personnel, Allen, and Allen's union representative, Dunlop reinstated Allen in November, with full benefits. However, Dunlop was unable to find a job that Allen could perform in compliance with the post-surgery medical restrictions placed on him by Dr. Bacon. Accordingly, Allen did not return to work at Dunlop. Allen filed this retaliatory-discharge claim.
Alabama's Workers' Compensation Act provides medical benefits, disability benefits, and numerous other benefits to employees who sustain work-related injuries. Ala.Code 1975, §§ 25-5-77; 25-5-57; 25-5-60; 25-5-111. Before 1984, however, the Alabama Legislature did not provide a cause of action for employees who were fired in retaliation for seeking workers' compensation benefits. In Meeks v. Opp Cotton Mills, Inc., 459 So. 2d 814 (Ala.1984), this Court declined to create an exception to the employment-at-will doctrine for retaliatory discharges.
The legislatures and courts of some other states did provide a narrow exception to the employment-at-will doctrine for retaliatory discharge of those who sought workers' compensation benefits. See Theresa Ludwig Kruk, Annotation, Recovery for discharge from employment in retaliation for filing workers' compensation claim, 32 A.L.R.4th 1221-38 (1984). The exception took one of two forms: (1) that the filing for workers' compensation benefits was a substantial cause of the termination, see, e.g., Chism v. Mid-South Milling Co., 762 S.W.2d 552, 556 (Tenn.1988) (requiring that the filing for workers' compensation benefits be a "substantial factor" in the termination decision), Azar Nut Co. v. Caille, 720 S.W.2d 685, 687 (Tex.App.1986) (filing for workers' compensation benefits must be a "determining factor" in the termination decision), aff'd, 734 S.W.2d 667 (Tex.1987); or (2) that the filing for workers' compensation benefits was the sole cause of the termination, Frampton v. Central Indiana Gas Co., 260 Ind. 249, 297 N.E.2d 425, 428 (1973) (filing for workers' compensation benefits must be the sole cause of termination); Hansome v. Northwestern Cooperage Co., 679 S.W.2d 273, 275 (Mo. 1984) (stating that employee's filing for workers' compensation benefits must be the exclusive cause of termination).
In 1984, the Alabama Legislature made the policy decision to provide a narrow exception to the employment-at-will doctrine for a retaliatory discharge that occurred solely because of the filing of a workers' compensation claim. Section 25-5-11.1, Ala.Code 1975, provides in pertinent part:
(Emphasis added.)
To survive a motion for a judgment as a matter of law on a claim for retaliatory discharge under § 25-5-11.1, an employee must make a prima facie showing that he was terminated for seeking workers' compensation benefits. Twilley v. Daubert Coated Products, Inc., 536 So. 2d 1364, 1369 (Ala. 1988); Rule 50, Ala. R. Civ. P. Once a prima facie case has been established, the burden shifts to the employer to present substantial evidence indicating that the termination was for a legitimate reason. Id. Once the employer has demonstrated a legitimate reason for discharging the employee, the burden shifts back to the employee. The employee must then rebut the employer's proffered reasons with substantial evidence indicating that these reasons are mere pretexts for an otherwise impermissible termination. Id.; *972 see Lozier Corp. v. Gray, 624 So. 2d 1034 (Ala.1993).[3]
Legitimate reasons for discharge (that is, reasons that are not a mere pretext for retaliation) may include "the employee's own shortcomings, such as unexplained tardiness, excessive absenteeism, lying with respect to previous compensation claims, or physical inability to do the job." 2A A. Larson, The Law of Workmen's Compensation, § 68.36(d), pp. 188-91 (1990); see, e.g., Smith v. Dunlop Tire Corp., 663 So. 2d 914 (Ala.1995) (holding that an employer could terminate an employee pursuant to a "no fault" absentee policy even though the employee's absences were caused by work-related injuries); Noble v. AAA Plumbing Pottery Corp., 677 So. 2d 765, 768 (Ala.Civ.App. 1995) (holding that "physical inability to perform a job, where the employer has no other jobs that the employee can perform, constitutes a legitimate, nondiscriminatory reason for termination of employment"); Terry v. Lee Apparel Co., 656 So. 2d 811 (Ala.Civ.App. 1994) (upholding a summary judgment for an employer on a retaliatory-discharge claim where the employee was discharged for leaving work without permission).
Allen presented evidence indicating that Dunlop terminated him solely because he filed for workers' compensation benefits. Dunlop then presented evidence indicating that it terminated Allen because he either would not or could not perform his job.
Two physicians, Dr. Horn, Allen's treating physician, and Dr. Davis, the plant physician, stated that Allen could perform the light-duty SRI Apex machine operator's job to which Allen was assigned. Nonetheless, Allen walked off the job. Given this action and Allen's entire employment record, Dunlop terminated Allen's employment in September 1993 for lack of performance. Dunlop reinstated Allen in November, but at trial it presented evidence indicating that it was unable to find another even lighter-duty job at its 12-hour-per-shift facility that would comply with the medical restrictions prescribed by Dr. Bacon, Allen's new treating physician. This shifted the burden back to Allen to produce substantial evidence to rebut these two reasons and thereby leave Allen's filing for workers' compensation benefits as the sole reason for his termination. Allen attempts to rebut Dunlop's proffered reason that he either would not or could not perform his job, by arguing, first, that he really was disabled and, second, that he really was not disabled.[4]
First, Allen argues that, consistent with Dr. Bacon's diagnosis, he really was disabled when he walked off his job, and thus that Dunlop's proffered reasonthat Allen would not perform his jobwas untrue. This is not substantial evidence to rebut Dunlop's position that it relied on the opinions of two of the three physicians, including Allen's treating physician, Dr. Horn, that Allen could perform his job.[5] Even if Dunlop had relied on the diagnosis of the third physician, Dr. Bacon, Dunlop had no 8-hour job for Allen to perform at its 12-hour-per-shift facility. Given Dunlop's prior history of working with *973 Allen's multiple injuries and absences, cf. Continental Eagle Corp. v. Mokrzycki, 611 So. 2d 313, 319-20 (Ala.1992), one must conclude that Allen's attempted rebuttal fails to establish that the sole reason for Allen's termination was his filing for workers' compensation benefits. See Consolidated Stores, Inc. v. Gargis, 686 So. 2d 268, 272 (Ala.Civ. App.1996) (noting that an implicit requirement for establishing a claim of retaliatory discharge is that the "employee must be willing and able to perform the job in order to assert a retaliatory discharge claim").
Second, Allen attempts to rebut Dunlop's evidence that after Dunlop reinstated him, he could not perform any job available at the plant. Allen argues that he was capable of performing certain jobs at the plant. Dunlop presented forceful evidence indicating that it made a good-faith, but unsuccessful, effort to find an existing job that Allen could perform. First, Dunlop's labor-relations manager testified that he met with Allen and Allen's union representative to determine if there were any existing jobs that Allen could perform at the plant, given the job requirements and Allen's medical restrictions.
Under Dunlop's union contract, Allen was eligible only for those jobs for which he had seniority. Three jobs were explored: (1) maintenance clerk; (2) porter's cleaner; and (3) mold cleaner. Allen did not meet the educational requirement for maintenance clerk; thus, Dunlop's labor-relations manager explored whether the medical restrictions imposed after his July 1993 operation would prevent him from performing the porter's-cleaner job or the mold-cleaner job.
After Dr. Bacon's July 1993 operation on Allen's knee, Dr. Bacon permanently restricted Allen to 8-hour days, with "no standing or walking for fifteen minutes at a time, no climbing of stairs, no squatting, kneeling, or lifting more than fifteen pounds." Dunlop asked Allen to see another physician, Dr. Keith Anderson; it was Dr. Anderson's opinion that Allen, after his July 1993 operation, could work 12-hour days, but that Allen should be subject to the other permanent physical restrictions imposed by Dr. Bacon. Dunlop's labor-relations manager testified that, based on the post-operation physical restrictions upon which the medical experts agreed, Allen could not perform the porter's-cleaner job, because it required lifting and climbing stairs.[6] The labor-relations manager spoke with Dr. Davis regarding the mold-cleaner job and determined that Allen could not perform that job, because of the physical restrictions placed on him.[7]
In response, Allen offered only his own testimony that he could perform the jobs of mold cleaner and maintenance clerk. This testimony is insufficient under Twilley, 536 So. 2d at 1369, to constitute substantial evidence that Dunlop's decision (that Allen could not perform the mold-cleaner and maintenance-clerk jobs) was a mere pretext and that the sole reason Dunlop terminated Allen was his filing for workers' compensation benefits. Allen testified at trial, "I have been physically unable to return to Dunlop." Further, Dunlop produced evidence indicating (1) that Allen had filed for private insurance disability benefits, claiming that a physical disability prevented him from working, and (2) that Allen had filed for Social Security benefits, claiming that a physical disability prevented him from working. In determining whether a plaintiff's evidence rises to the level of substantial evidence rebutting the evidence of the defendant, this Court must examine the weight and quality of that evidence. See generally K.S. v. Carr, 618 So. 2d 707, 713 (Ala.1993) (stating that substantial evidence is "evidence of such weight and quality that fair-minded persons in the exercise of impartial judgment can reasonably infer the existence of the fact sought to be proved") (quoting West v. Founders Life Assurance Co. of Florida, 547 So. 2d 870, 871 (Ala.1989)) (emphasis added). Even under the old scintilla rule of evidence, let alone the substantial evidence rule applicable here, this Court concluded that contradictory statements *974 by a plaintiff failed to create a genuine issue of material fact to preclude a judgment as a matter of law. Robinson v. Hank Roberts, Inc., 514 So. 2d 958, 961 (Ala.1987) (citing Van T. Junkins & Associates, Inc. v. U.S. Industries, Inc., 736 F.2d 656, 657 (11th Cir.1984)). Accord Reigel v. Kaiser Foundation Health Plan, 859 F. Supp. 963, 970 (E.D.N.C.1994) (stating that with respect to claims under the Americans with Disabilities Act a plaintiff "cannot speak out of both sides of [his] mouth with equal vigor and credibility"). Under the significantly higher evidentiary standard embodied in the substantial evidence rule, I would hold that Allen's mere assertion that he could perform certain jobs fails to establish "substantial evidence" that Dunlop's stated reasonthat Allen could not perform those jobswas a mere pretext.[8]
Because Allen failed to offer substantial evidence that Dunlop's refusal to let him perform a job for which he is not qualified was a pretext, Allen's case depends on whether it is permissible for Dunlop to terminate his employment for his physical inability to perform his job. In Harrison v. Southern Pine Electric Cooperative, 603 So. 2d 1004 (Ala.1992), this Court upheld a summary judgment for an employer on a retaliatory-discharge claim where the treating physician had indicated that the employee, who had suffered a work-related injury, was physically unable to perform his regular job or other jobs available at the employer's plant. Similarly, in Smith, 663 So. 2d at 918-19, this Court upheld a summary judgment for an employer on a retaliatory-discharge claim where an employee was terminated for violating a neutrally applied absentee policy, even though his work-related injury precipitated the absences.[9]
Although it is not binding on this Court, the cogent opinion of United States District Judge Hancock in Cheatwood v. Roanoke Industries, 891 F. Supp. 1528 (N.D.Ala.1995), is particularly enlightening. Judge Hancock applied Ala.Code 1975, § 25-5-11.1, to a work-related injury for which Cheatwood had obtained a permanent medical restriction that disqualified him from any work at his employer's plant. Id. at 1533-34. In order to obtain disability benefits, Cheatwood represented that his medical disability prevented him from performing his job. Id. at 1534-35, 1540. Judge Hancock discounted the fact that Cheatwood had been terminated six months after filing for workers' compensation benefits and noted that Cheatwood had not informed his employer that his condition had improved to the point where he could perform his old job. Id. at 1540. Holding that the termination of an employee whose permanent disability prevented him from adequately performing his job was a termination for a legitimate reason, Judge Hancock stated:
Id. (quoting Cardwell v. American Linen Supply, 843 P.2d 596, 599 (Wyo.1992)); see Ala.Code 1975, § 25-5-57 (providing partial and total disability benefits for employees who sustain work-related injuries).
Similarly, after suffering a work-related injury, Allen obtained a permanent medical restriction for "no standing or walking for fifteen minutes at a time, no climbing of stairs, no squatting, kneeling, or lifting more than fifteen pounds." These restrictions disqualified him from any work at Dunlop's plant. In order to obtain disability benefits, Allen represented that his medical disability prevented him from performing his job. Allen was terminated six months after filing for workers' compensation benefits, and he never informed his employer that the permanent medical restriction had been lifted. Dunlop's termination of Allen's employment for physical inability to perform his job was legitimate. See Harrison, 603 So.2d 1004-05; Smith, 663 So.2d at 918-19; Cheatwood, 891 F. Supp. at 1540. Lambert v. Beverly Enterprises, Inc., 695 So. 2d 44, 47 (Ala.Civ.App. 1997) (holding that an employee was properly terminated for inability to perform her duties and declining to expand the Alabama Workers' Compensation Act to include provisions that would require employers to make accommodations to assist employees in performing duties they otherwise would not be able to perform). Indeed, had Dunlop acted otherwise, it would have been acting contrary to Allen's safety and well-being. See Noble, 677 So. 2d at 768 (stating that a failure to terminate an employee for a work-related disability that proscribed work at the employer's plant "would have demonstrated an almost total lack of concern for [the employee's] safety").
In my view, Allen failed to present substantial evidence indicating that there were no legitimate reasons for his termination and, thus, failed to present substantial evidence indicating that the sole reason for the termination of his employment was his filing for workers' compensation benefits. Accordingly, I would reverse the trial court's denial of Dunlop's motion for a judgment as a matter law and render a judgment in favor of Dunlop.[10]
Therefore, I dissent.
HOOPER, C.J., and MADDOX, J., concur.
SEE, Justice (statement of nonrecusal).
The plaintiff, Mickey Allen, through his attorneys, has moved for my recusal in this case.[11] Because the facts upon which the recusal motion is based are distinct from and unrelated to any material matter in this case, and, as a matter of fact and law, do not affect my impartiality in ruling on matters involving the plaintiff, I decline to recuse.
In September 1996, during my campaign for this office, my campaign committee issued a press release that mentioned a political contribution and Mr. John M. Plunk. Beginning on April 16, 1998, Mr. Plunk's law firm, Alexander, Corder, Plunk & Baker, P.C., filed motions seeking my recusal in a number of cases, including this present case.[12] The recusal motion includes an affidavit *976 in which Mr. Plunk threatened to sue me based on his characterization of the statement in the press release as libelous. The recusal motion does not allege any actual or apparent bias on my part against the plaintiff.
The law of recusal reflects two fundamental judicial policies: First, it is the duty of a judge to decide cases. Second, a judge should be a neutral, or impartial, decision-maker. The Constitution of the United States and the Constitution of Alabama of 1901 impose on judges the duty to decide cases. See U.S. Const. art. III, § 1 (vesting the "judicial Power of the United States ... in one supreme court, and in such inferior courts as the Congress may from time to time ordain and establish"); id. at art. VI ("[A]ll ... judicial Officers, both of the United States and of the several States, shall be bound by Oath or Affirmation, to support this Constitution...."); Plaut v. Spendthrift Farm, Inc., 514 U.S. 211, 218-19, 115 S. Ct. 1447, 131 L. Ed. 2d 328 (1995) ("Article III establishes a `judicial department' with the `province and duty' ... to decide ... `case[s].'") (quoting Marbury v. Madison, 5 U.S. (1 Cranch) 137, 177, 2 L. Ed. 60 (1803) (emphasis added)); Marbury, 5 U.S. at 180 (stating that a judge's oath to support the Constitution requires that he exercise the judicial power and decide cases in a manner consistent with fundamental law); Pierson v. Ray, 386 U.S. 547, 554, 87 S. Ct. 1213, 18 L. Ed. 2d 288 (1967) ("It is a judge's duty to decide all cases within his jurisdiction...."); Ala. Const.1901 amend. 328, § 6.01(a) ("[T]he judicial power of the state shall be vested exclusively in a unified judicial system which shall consist of a supreme court ...."); id. at § 279 (requiring "all officers, executive and judicial, ... [to] take the following oath or affirmation: `I, ___________, solemnly swear ... that I will support the Constitution of the United States, and the Constitution of the State of Alabama ... and that I will faithfully and honestly discharge the duties of the office upon which I am about to enter'"); Federated Guaranty Life Ins. Co. v. Bragg, 393 So. 2d 1386, 1389 (Ala.1981) ("`[I]t is the duty of the judge to adjudicate the decisive issues involved in the controversy... and to make binding declarations concerning such issues, thus putting the controversy to rest ....'") (citation omitted).
The Due Process Clauses of the Constitution of the United States and of the Alabama Constitution require that a judge be a neutral decision-maker. U.S. Const. amend. XIV, § 1 ("No State shall ... deprive any person of life, liberty, or property, without due process of law...."); Concrete Pipe & Products of California, Inc. v. Construction Laborers Pension Trust for Southern California, 508 U.S. 602, 617, 113 S. Ct. 2264, 124 L. Ed. 2d 539 (1993) ("[D]ue process requires a `neutral and detached judge....'"); Aetna Life Ins. Co. v. Lavoie, 475 U.S. 813, 106 S. Ct. 1580, 89 L. Ed. 2d 823 (1986) (examining due process ramifications of a state Justice's financial interest in the outcome of a case on which he had ruled); Stallworth v. City of Evergreen, 680 So. 2d 229, 233-34 (Ala.) ("An unbiased and impartial decision-maker is one of the most, if not the most, fundamental ... requirements of fairness and due process."), cert. denied, ___ U.S. ___, 117 S. Ct. 509, 136 L. Ed. 2d 399 (1996); Ala. Const.1901, § 6 ("[I]n all criminal prosecutions, the accused... shall not be ... deprived of life, liberty, or property, except by due process of law...."); id. at § 13 ("[E]very person, for any injury done him, in his lands, goods, person, or reputation, shall have a remedy by due process of law...."); Ex parte Wilkey, 233 Ala. 375, 377, 172 So. 111, 113 (1937) (recognizing that §§ 6 and 13 of the Constitution of Alabama of 1901 require courts to be "impartial tribunals").
Thus, the recusal law embodied in statutes, court decisions, and codes of ethics reflects both the duty to decide cases and the requirement of impartiality. See, e.g., 28 U.S.C. § 455 (requiring federal judges to recuse themselves from any proceeding in which their "impartiality might reasonably be questioned"); Ala.Code 1975, § 12-1-12 (prescribing general grounds for disqualification of Alabama judges from the trial of cases). The following general rule is established by Canon SC., Ala. Canons of Jud. Ethics:
(Emphasis added.)
Canon 3C's general rule of recusal must be applied in a manner that balances the policy requiring a judge to decide cases and the policy requiring a judge to be a neutral decision-maker. To support the policy of impartiality, the courts will require recusal not only for actual bias, but also for the appearance of bias. See, e.g., Ala. Jud. Inquiry Comm'n Adv. Op. No. 84-226 (1984) (stating that a judge should recuse when he has "become so biased or prejudiced because of the lawsuit that he could not give the client of the attorney or the firm the impartial hearing to which the client is entitled"); Ex parte Duncan, 638 So. 2d 1332, 1334 (Ala.) (stating that recusal depends on "whether there is an appearance of impropriety"), cert. denied, 513 U.S. 1007, 115 S. Ct. 528, 130 L. Ed. 2d 432 (1994).
Where a party seeks a judge's recusal based on conduct of the judge that shows personal and official bias related to the case at bar, recusal will generally be required because the appearance of partiality outweighs the duty of the judge to decide that case. Crowell v. May, 676 So. 2d 941, 944 (Ala.Civ.App.1996) (stating that "[t]he strictest application of this rule may `sometimes bar trial by judges who [are impartial] and who would do their very best to weigh the scales of justice equally between contending parties, ... to perform its high function in the best way "justice must satisfy the appearance of justice."'") (quoting In re Murchison, 349 U.S. 133, 136, 75 S. Ct. 623, 99 L. Ed. 942 (1955)).
On the other hand, in order to support the policy favoring the deciding of cases, the courts generally will not require recusal based on alleged personal, or unofficial, partiality that is not related to the case. See, e.g., Gipson v. State, 646 So. 2d 701 (Ala. Crim.App.1994) (stating that recusal was not required where the attorney seeking recusal made allegations that the judge had manifested hostility toward him in the past and had unlawfully held the attorney in contempt in an unrelated proceeding); Henderson v. G & G Corp., 582 So. 2d 529 (Ala.1991) (stating that a judge was not required to recuse where the judge had given testimony against the attorney in an unrelated proceeding); McLeod v. State, 581 So. 2d 1144, 1153 (Ala. Crim.App.1990) (stating that the mere filing of a civil action by an attorney against a judge does not require the judge's recusal in unrelated matters concerning that attorney); see also, e.g., Ex parte Balogun, 516 So. 2d 606, 609 (Ala.1987) (stating that there is a presumption that a judge is a neutral decision-maker) (citing Fulton v. Longshore, 156 Ala. 611, 46 So. 989 (1908)). Accordingly, where a party seeks to create an artificial appearance of bias by, for example, filing a separate lawsuit against the judge, recusal will generally not be required, because the duty of the judge to decide that case outweighs the appearance of partiality. "To hold otherwise would allow a litigant to control judicial proceedings whenever a litigant becomes dissatisfied with the course of the proceedings." Ala. Jud. Inquiry Comm'n Adv. Op. No. 97-686 (1997). Accord McLeod, 581 So. 2d at 1153 ("`It is axiomatic that a litigant cannot control pending litigation by the mere filing of [a civil action] against the trial judge. To base disqualification on the mere filing of such an action would create chaos in the judicial system and could prevent cases from ever being tried.'") (quoting Ala. Jud. Inquiry Comm'n Adv. Op. No. 86-273 (1986)); 46 Am.Jur.2d Judges § 155 (1994) ("A judge is not automatically disqualified solely because a party in a case pending before the judge files a complaint against the judge ... [;] to hold otherwise would invite the filing of a ... complaint solely to obtain a judge's disqualification and would invite judge shopping.") (citing, e.g., Thomas v. State, 611 So. 2d 416 (Ala.Crim. App.), cert. denied, 611 So. 2d 420 (Ala.1992); Ham v. State, 540 So. 2d 805 (Ala.Crim.App. 1988)).
The motion for my recusal is based on a threatened lawsuit concerning a political *978 statement contained in a press release issued by my campaign committee during my 1996 campaign for this office. The political statement dealt with a campaign contribution and was in no way related to this case. Therefore, Mr. Plunk's threatened lawsuit does not require my recusal from this case. See Reach v. Reach, 378 So. 2d 1115 (Ala.Civ.App. 1979) (refusing to require recusal of the trial judge in a proceeding involving a petition for an increase in child support, even though the attorney appearing before the judge had been the campaign manager for the attorney who opposed the judge in a recent judicial campaign), cert. denied, 378 So. 2d 1118 (Ala. 1980); Richard E. Flamm, Recusal and Disqualification of Judges, § 21.5 (1996) ("The rule that suing a judge does not create legitimate grounds for disqualifying that judge applies, a fortiori, where suit against the judge has been threatened but not filed."); see also Ala. Jud. Inquiry Comm'n Adv. Op. No. 97-686; McLeod, 581 So. 2d at 1153; Thomas, 611 So. 2d 416; Ham, 540 So. 2d 805.
Because the plaintiff's motion fails to establish actual or apparent partiality with respect to the case at issue, my constitutional duty to decide this case requires that I decline to recuse myself.
[1] Allen had requested that another physician examine his knee. Because the treating physician, Dr. Horn, indicated that no further treatment of Allen's knee was needed, Dunlop declined to provide a third physician. See Ala.Code 1975, § 25-5-77(a) ("If the employee is dissatisfied with the initial treating physician selected by the employer and if further treatment is required, the employee may so advise the employer, and the employee shall be entitled to select a second physician from a panel or list of four physicians selected by the employer.") (emphasis added).
[2] Allen's performance ratings on the SRI Apex machine operator's job began high81% and 91% during February and March 1993but decreased to only 35% during May.
[3] Alabama has abandoned the "scintilla rule" of evidence, for the significantly higher standard embodied in the "substantial evidence rule." See Ala.Code 1975, § 12-21-12; Brown v. Gamble, 537 So. 2d 476 (Ala.1989).
[4] Allen also argues that Dunlop acted in bad faith by placing him on an SRI Apex machine that required climbing, when a few of the SRI Apex machines required no climbing. Dunlop reassigned Allen from the tire builder's job, which placed significant stress on his knee, to the SRI Apex machine operator's job, which placed substantially less stress on his knee, only after Dr. Davis inspected and approved the SRI work site. This significant evidence of good faith is not undermined by the possibility that Dunlop could have removed some additional increment of stress. See Hammock v. Ryder Dedicated Logistics, Inc., 716 So. 2d 215 (Ala.Civ.App. 1998) (holding that "under the workers' compensation law, [the employer is] not required to create a light-duty position, nor [is the employer] required to provide the employee with accommodations to aid his ability to perform the job") (citing Lambert v. Beverly Enterprises, Inc., 695 So. 2d 44 (Ala.Civ.App.1997)).
[5] Allen also argues that Dunlop failed to use its standard termination procedure with him. Allen did not afford Dunlop an opportunity to do so, however, when he walked off the job and presented a medical prescription that prevented him from performing any job at Dunlop's 12-hour-per-shift facility.
[6] The maintenance-clerk job also required some climbing of stairs.
[7] After Allen's July 1993 operation, Dr. Horn did not reevaluate his original opinion that Allen could work 12-hour days.
[8] Although Dunlop did not expressly argue on appeal that Allen should be "estopped" from arguing that he could perform certain jobs, after he had stated that he could not perform any job, I note that the doctrine of estoppel would bar such a tactic. See, e.g., Consolidated Stores, Inc. v. Gargis, 686 So. 2d 268, 274-75 (Ala.Civ.App. 1996) (holding that an employee who, for the purpose of obtaining Social Security disability benefits, asserted that he was disabled could not assert that he was not disabled, for the purpose of prosecuting his retaliatory-discharge claim); Garcia-Paz v. Swift Textiles, Inc., 873 F. Supp. 547, 554-56 (D.Kan.1995) (rejecting the plaintiff-employee's argument that she was terminated for a discriminatory reason in violation of the Americans with Disabilities Act where she had applied for and had received private insurance and Social Security disability benefits).
[9] Other courts have reached the same conclusion. See, e.g., Judson Steel Corp. v. Workers' Compensation Appeals Bd., 22 Cal. 3d 658, 667, 586 P.2d 564, 569, 150 Cal. Rptr. 250, 255 (1978) (stating that employers are not required to ignore the realities of business and retain all injured employees or reemploy unqualified employees or employees for whom positions are no longer available); St. Clair v. District of Columbia Dep't of Employment Services, 658 A.2d 1040 (D.C. 1995) (holding that a physical disability that prevented an employee from working the number of hours required by his employer was a legitimate reason for termination); Conklin v. City of Newburgh, 205 A.D.2d 841, 613 N.Y.S.2d 287 (1994) (upholding an administrative decision for an employer on a retaliatory-discharge claim where termination was for excessive absences caused by medical restrictions arising from a work-related injury); Anderson v. Standard Register Co., 857 S.W.2d 555 (Tenn.1993) (upholding a summary judgment for an employer on a retaliatory-discharge claim where the termination was for excessive absences caused by medical restrictions arising from a work-related injury).
[10] Because I conclude that Dunlop terminated Allen for legitimate reasons, I pretermit discussion of Dunlop's allegations of jury misconduct and its argument that the trial court gave improper jury instructions.
[11] Although it is unclear whether the motion requesting my recusal is addressed to me or to the entire Court, recusal is a matter properly submitted first to the Judge or Justice whose recusal is sought. Aetna Life Ins. Co. v. Lavoie, 470 So. 2d 1060, 1089 (Ala.1984), vacated on other grounds, 475 U.S. 813, 106 S. Ct. 1580, 89 L. Ed. 2d 823 (1986). I therefore treat this motion as one directed to me.
[12] Members of Mr. Plunk's firm are the plaintiff's attorneys of record in this case. Mr. Plunk's name does not appear on the briefs for this case. | 50012cb297fb59c89cb97f748b90f9c3338d89f8b373294f3ff9e355e09a507c | 1998-10-02 00:00:00 |
1f60996c-5c8b-4eb4-92c7-561e56b64b64 | Ex Parte Davis | 721 So. 2d 685 | 1970535 | Alabama | Alabama Supreme Court | 721 So. 2d 685 (1998)
Ex parte Warden Leoneal DAVIS and Deputy Warden Charles Boutwell.
(In re Leola PINKNEY, as administratrix of the estate of inmate Donald L. Williams v. Leoneal DAVIS and Charles Boutwell).
1970535.
Supreme Court of Alabama.
September 4, 1998.
*686 Ellen Leonard, asst. atty. gen., Department of Corrections, for petitioner.
Jill T. Karle of Karle & Green, L.L.C., Alabaster, for respondent.
LYONS, Justice.
Leoneal Davis, as warden of the Draper Correctional Facility, and Charles Boutwell, as deputy warden of that facility, are defendants in an action pending in the Montgomery Circuit Court. They petition for a writ of mandamus directing that court to enter a summary judgment in their favor, based upon their defenses of absolute sovereign immunity and/or discretionary-function immunity. We grant their petition.
Leola Pinkney, as administratrix of the estate of Donald L. Williams, deceased, who had been an inmate in the Alabama prison system, brought a wrongful death action against Leoneal Davis, in his official capacity as warden of the Draper Correctional Facility ("Draper"); Charles Boutwell, in his official *687 capacity as a deputy warden of Draper; and certain other correctional officers at Draper. She alleged that the defendants had a duty to maintain the security, care, and welfare of the inmates at Draper; that they had breached this duty by failing to provide Williams with adequate medical care; and that their failure had caused Williams's death.[1]
On the defendants' motion, the action was removed to the United States District Court for the Middle District of Alabama. That court entered a summary judgment in favor of the defendants on certain federal claims included in the complaint. That court then remanded the case to the Montgomery Circuit Court. The defendants then moved for a summary judgment in the circuit court, arguing that they were immune from suit, pursuant to Article I, § 14, of the Alabama Constitution. The trial court entered a summary judgment in favor of all the defendant correctional officers except Davis and Boutwell, on the basis of discretionary function immunity. The trial court held that only Davis and Pinkney were charged with the responsibility for Williams's health and care and that these duties were discretionary functions; however, the trial court concluded that the evidence created genuine issues of material fact as to whether Davis and Boutwell, in performing their discretionary functions, had caused Williams's death by actions undertaken willfully, maliciously, or in bad faith, and that the defense of sovereign immunity therefore would not apply to them.
In July 1993, Williams was sentenced to serve three years in the custody of the Alabama Department of Corrections. Williams suffered from sarcoidosis, an autoimmune disease that primarily affected his lungs and caused him to experience shortness of breath, chest pain, and recurrent bouts of pneumonia. Although sarcoidosis is incurable, it is not always fatal; certain medications, primarily Prednisone, a corticosteroid, can induce remission of the disease. When he was sentenced, Williams was regularly taking prescribed medication, including Prednisone, to control his sarcoidosis.
After being sentenced, Williams entered the Montgomery County Correctional Facility to await transfer to a state correctional facility; while incarcerated in the Montgomery County facility, Williams was provided with his medication. Williams was transferred to the Kilby Correctional Facility on August 12, 1993. At that time, QuestCare, Inc., a private corporation, was under contract with Kilby prison to provide necessary medical care to inmates in that prison. The day after Williams arrived, a licensed practical nurse employed by QuestCare completed a "report of health assessment" for Williams; in it, she noted that Williams suffered from sarcoidosis and that his current prescribed medications were Prednisone, inhalers, and an antidepressant. The patient note/physician orders do not indicate any treatment or the issuance of any medication to Williams.
During August 1993, Williams reported to the Kilby health care unit several times, complaining of shortness of breath and chest pain, and was twice admitted to the Kilby hospital unit. A QuestCare physician confirmed that Williams suffered from sarcoidosis and prescribed Prednisone for him; initially, he prescribed only half the dosage Williams was taking before he was incarcerated, but he increased the dosage after receiving Williams's medical records. In September, Williams again reported to the health care unit, this time with a fever, a low pulse, and marked wheezing. A QuestCare physician changed Williams's Prednisone dosage, first doubling it, then gradually reducing it to zero at the end of five days.
Approximately two weeks later, Williams was transferred to Draper; at that time, his medication records listed his only medications as a bronchial dilator, an inhaler, and Elavil. Williams was not prescribed Prednisone at the time of the transfers. Draper, likewise, had a contract with QuestCare, whereby Questcare would provide medical *688 care to the inmates at Draper. Six days after he arrived at Draper, Williams appeared at the facility's health care unit complaining of breathing problems. He was not referred to a physician. Several days later, he again reported to the health care unit, and on that visit he told the attending nurse that he had sarcoidosis. Over the course of the next several weeks, he was given an inhaler, but was not prescribed Prednisone.
During this period, Williams regularly telephoned his mother, Leola Pinkney, to report that he was feeling ill and that he was not receiving his proper medication. After each of these calls, Pinkney would telephone Boutwell's office and alert his secretary, Janet Findley, that Williams was ill and needed medical care. Findley testified in deposition that she did not recall immediately passing this information on to Boutwell, but that she did inform him of Pinkney's concerns. Findley testified that each time Pinkney called, Findley notified the prison medical staff and relayed to Pinkney any further information she could get about Williams's condition.
On November 13, 1993, Pinkney visited her son and was shocked at his apparent ill health. On that date, she scheduled an appointment for Williams to be examined on November 19 at a local Veterans Administration ("VA") hospital outside the prison, and the appointment was approved by one of the prison doctors. However, Pinkney did not inform any prison officials about the appointment until November 17, when she telephoned Findley to ask about transportation for Williams. Findley informed Pinkney that any outside medical appointments for inmates had to be made through the prison and that the prison had certain mandatory security procedures for transporting prisoners to such appointments. She told Pinkney that two days' notice was not sufficient to arrange for Williams to be transported to his appointment. Findley personally telephoned the VA hospital and cancelled the appointment Pinkney had made; however, she rescheduled an appointment for Williams for November 30. Findley notified Boutwell that she had made an appointment for Williams to be examined at the VA hospital and told him about Pinkney's concerns for her son's health.
On November 20, 1993, Pinkney received a telephone call from a Draper inmate, who notified her that she should not come to visit her son because he was too weak to get out of his bed. There is evidence that on November 23 Pinkney telephoned Warden Davis and told him her son was very ill and that she was afraid he might die. She asked Davis to allow her son to be taken to an emergency room in a hospital outside the prison. There ensued a discussion concerning the possible transfer of Williams; however, the QuestCare physician on duty declined to authorize the transfer and Davis did not overrule the doctor's decision.
On November 28, Williams visited the health care unit; the nurse noted that he was emaciated, that he weighed 121 pounds, and that he had not been eating because "he is too weak to go to chow." Later that day, Williams returned to sick call in a disoriented condition and told the attending nurse that he had been having breathing problems all day. He was transferred to the Montgomery Regional Medical Center, and he arrived there with a collapsed lung and a temperature exceeding 104°. A chest X-ray revealed that he was suffering from pneumonia, and he was further diagnosed with malnutrition, at a weight of 117 pounds. He remained at the hospital approximately three weeks, until his death on December 22, 1993, from multiple organ failure, sarcoidosis, and sepsis.
We note that Article I, § 14, of the Alabama Constitution of 1901, provides "[t]hat the State of Alabama shall never be made a defendant in any court of law or equity," and that this sovereign immunity extends to State employees acting within the general scope of their authority in performing functions that involve a degree of discretion. McDuffie v. Roscoe, 679 So. 2d 641 (Ala.1996). "Discretionary acts" are defined as "those acts as to which there is no hard and fast rule as to the course of conduct that one must or must not take and those acts requiring exercise in judgment and choice and involving what is just and proper under *689 the circumstances." Wright v. Wynn, 682 So. 2d 1, 2 (Ala.1996). To claim the benefit of sovereign immunity, a defendant State employee has the burden of establishing that the plaintiff's claims arise from the employee's performance of discretionary functions for the State. Wright.
However, a State officer or employee is not protected by discretionary immunity if in performing his discretionary functions he willfully, maliciously, fraudulently, or in bad faith injures someone. Barnes v. Dale, 530 So. 2d 770 (Ala.1988). Once a defendant demonstrates that a plaintiff's claims arise from the defendant's performance of a discretionary function, the burden then shifts to the plaintiff to establish that the defendant acted in bad faith or with malice or willfulness, in order to deny the defendant discretionary immunity from suit. Wright v. Wynn, supra. The applicability of the doctrine of discretionary function must be determined on a case-by-case basis, and it is a question of law to be decided by the trial court. McDuffie v. Roscoe, supra. A petition for a writ of mandamus is the proper means for achieving appellate review of a trial court's denial of absolute and discretionary-function immunity. Ex parte Wanger, 709 So. 2d 455 (Ala.1997).
As noted, the trial court found that Pinkney's claims against Davis and Boutwell arose from their performance of discretionary functions; however, the court then found that there was substantial evidence creating a genuine question of material fact as to whether Davis and Boutwell had caused Williams's death by performing these functions willfully, maliciously, or in bad faith.
Pinkney bases her claims against Leoneal Davis on the theory that, as a warden of Draper, Davis was charged with the responsibility of ensuring that inmates receive prompt medical care; that he was aware on November 23, 1993, at the very latest, that Williams was seriously ill; and that he breached his duty to Williams by failing to supervise the medical personnel at Draper or to take prompt action to give Williams medical attention on November 23.
Pinkney concedes that it was the duty of QuestCare, not Davis, to provide actual medical services to Williams. The record shows that after Davis spoke with Pinkney on November 23, he notified the prison medical personnel of Williams's condition, and that it was QuestCare medical personnel who decided not to approve Williams's transfer to an outside hospital. Davis has no medical training, and he did not question the decision of Williams's doctors not to hospitalize Williams that night. Instead, Davis left Williams in the care of doctors who had been treating Williams since he arrived at Draper, and he did not intervene to override their decisions as to Williams's course of treatment.
Williams was undeniably ill on November 23, and there is evidence that Davis was aware of this; however, the evidence does not suggest that Davis acted willfully, maliciously, or in bad faith in failing to override QuestCare's decision not to hospitalize Williams on that day. The evidence merely shows that Davis chose to accept the decision of Williams's doctors, who had more knowledge than Davis did about medicine in general and about Williams's case in particular. The QuestCare medical staff was on contract with the prison to make such decisions based on their expertise, and the fact that they did not successfully treat Williams's illness does not make Davis liable for leaving Williams to their care. The trial court properly determined that in referring Williams to the care of QuestCare physicians Davis was performing a discretionary function; however, there being no evidence that in performing this function Davis caused Williams's death by acting maliciously, willfully, or in bad faith, the court erred in denying Davis a summary judgment on Pinkney's claims.
Pinkney bases her claims against Charles Boutwell on allegations that Boutwell had a duty to ensure that inmates received prompt medical care when necessary and that, although Boutwell had had direct knowledge, over at least a two-week period, that Williams's health was deteriorating, he nevertheless refused to allow Williams to keep *690 his appointments with an outside VA hospital.
We note that, according to the record, the assistant warden's job description requires him to "insure that each inmate receives prompt medical attention when necessary." The record shows that, during a period of approximately two weeks before Williams was hospitalized on November 28, Pinkney made numerous telephone calls to Janet Findley to report that her son was very ill. However, the evidence does not show that Boutwell had direct knowledge of Williams's condition, until November 17. On that day, Pinkney telephoned Findley and informed her that she had scheduled an appointment for Williams to be examined at a local VA hospital on November 19. Findley advised Pinkney that, because the appointment had not been made through the prison and adequate supervision of Williams could not be arranged on such short notice, the appointment would have to be canceled. Findley obtained approval from QuestCare physicians to allow Williams to be examined outside the prison, then rescheduled the appointment at the local VA hospital. Findley informed Boutwell that she had made the appointment for Williams.
Williams did not keep the appointment Findley made for him, and this is the crux of Pinkney's claim against Boutwell; Pinkney argues that, although Boutwell's determining whether to allow Williams to see an outside doctor was a discretionary act, Boutwell performed the act maliciously by failing to enable Williams to keep his VA hospital appointment. As to the first appointment, it is clear that Boutwell himself was not involved in canceling it; rather, his secretary determined that it had not been made pursuant to the procedures Draper requires to be followed when an inmate is allowed to go beyond the grounds of the prison.[2] As to the second appointment, which Findley made for Williams, Boutwell points out that the appointment was made for November 30, two days after Williams was admitted to the Montgomery Regional Medical Center. Pinkney does not dispute the date of the appointment. Clearly, there was no reason for Boutwell to arrange for Williams to keep his November 30 appointment, when Williams was undergoing emergency treatment at another outside hospital. There is no evidence to support a finding that Boutwell maliciously or willfully failed to obtain reasonable medical care for Williams. The trial court, therefore, erred in denying Boutwell's motion for a summary judgment based upon discretionary-function immunity.
A writ of mandamus should be issued only where the petitioner has a clear legal right to the order sought and has no other adequate remedy. C & G Development v. Planning Comm'n of the City of Homewood, 548 So. 2d 451 (Ala.1989). Davis and Boutwell have demonstrated that, based on the defense of sovereign immunity, they have a clear legal right to a judgment on Pinkney's claims against them. Their petition for the writ of mandamus is granted.
PETITION GRANTED.
HOOPER, C.J., and MADDOX, SHORES, HOUSTON, and SEE, JJ., concur.
COOK, J., dissents.
[1] Pinkney also made claims against QuestCare, Inc., a company that had contracted with the State of Alabama to provide medical care to inmates in the Alabama prison system; these claims are not relevant to this petition.
[2] Obviously, concerns of public safety and preventing escapes make these precautions necessary, and Findley properly adhered to them. | 17be39fadf8763e473d7bdd599e7f4b799c74d33d940f9eda376d679d8bee258 | 1998-09-04 00:00:00 |
edc567dc-a702-4969-bde6-ae63ed47f277 | EMPLOYEES'BENEFIT ASS'N v. Grissett | 732 So. 2d 968 | 1961766 | Alabama | Alabama Supreme Court | 732 So. 2d 968 (1998)
EMPLOYEES' BENEFIT ASSOCIATION
v.
Richard D. GRISSETT.
1961766.
Supreme Court of Alabama.
September 11, 1998.
*970 Janie Salmon Gilliland of Memory & Gilliland, L.L.C., Montgomery, for appellant.
Sam E. Loftin of Loftin, Herndon, Loftin & Miller, Phenix City, for appellee.
LYONS, Justice.
The defendant, Employees' Benefit Association ("EBA"), appeals from a judgment entered in favor of the plaintiff, Richard D. Grissett. We affirm conditionally.
Grissett is a truck driver who has been employed for 18 years by Consolidated Freightways, Inc. EBA is a corporation that was formed in 1942 to provide certain benefits for the employees of Consolidated Freightways, Freightliner, Inc., and their *971 subsidiaries. Membership in EBA is entirely voluntary. EBA provides the following benefits for each member: life insurance of $25,000, additional group accidental death and dismemberment insurance, a funeral benefit of $300, and disability benefits in the amount of $15 per day for a maximum of six months for nonoccupational illness and injuries not covered by workers' compensation laws. In addition, EBA provides life insurance of $2,000 to any retiring member who has the requisite years of service. EBA provides its life insurance and accidental death benefits through a group life insurance policy that it obtains from a separate company; however, EBA provides its disability benefits from its own funds, which are received from the dues of its members. Each member pays dues of $6.75 per week.
EBA is governed by a five-member board of trustees; all of the board members must be members of the association. Four trustees are elected by EBA's membership; the fifth is appointed by the elected trustees. The board sets the policies of the association and controls its funds, both investments and disbursements. The board also appoints a manager to conduct the association's business. At all times pertinent to this case, Charles Prehn was EBA's manager. At the time of trial, he had served in that capacity for 17 years. A full-time secretary and a part-time bookkeeper are EBA's only other employees. EBA's offices are located in Portland, Oregon.
Upon joining EBA, each new member is provided with a copy of the association's articles of incorporation, its bylaws, and an informational pamphlet. A new member must agree to abide by the terms of the bylaws, which specify the time frame for submitting claims, the method for notice, and the forms necessary for use by the members when requesting disability payments. Grissett joined EBA in 1990. He acknowledged that upon joining he had received a copy of the bylaws and that he had agreed to abide by their terms.
On December 5, 1992, Grissett suffered a cerebral aneurysm at his home in Pittsview. He underwent neurosurgery in Birmingham on December 7 and was hospitalized until December 15. He then went home to recuperate. Grissett testified that he continued to take pain medication for about two months and that his doctors prescribed antiseizure medication for him until April 1993. He was not allowed to drive while he was taking this medication. Although Grissett's doctors had estimated that he would be disabled for six months, he was released on April 23, 1993, to return to work. Because his illness was not related to his job, Grissett was eligible for the disability benefits provided by EBA.
In order to file a claim for disability benefits, an EBA member is required to submit the claim on a particular form within a certain time. The version of the bylaws that was in effect when Grissett was disabled stated:
(Emphasis added.)
Grissett testified that his employer did not have any claim forms, so his wife telephoned the EBA office and requested EBA Claim Form # 1. After the Grissetts received the form, he said, he had to mail it to his doctor in Birmingham and wait for the doctor to complete his portion of the form and return it and that his wife then had to take the form to his employer in Phenix City to have the employer's portion completed. Only then, Grissett said, could he complete his portion of the form and submit it to EBA. EBA received Grissett's initial claim form on January 11, 1993, which was 37 days after he had first become disabled. According to EBA's bylaws, if a member filed a claim later than 31 days after the start of his or her disability, no benefits would be paid for the period before the claim was filed, unless the trustees were satisfied with the reason for the delay. Even though Grissett's claim was late, however, EBA paid the claim in full the day after it was received. Grissett received a $345 check dated January 12, representing payment for 23 days of disability for the period December 14, 1992, through January 5, 1993.[1] With this payment, EBA enclosed its Form # 2 for supplemental claims.
EBA Form # 2 must be completed by the member's attending physician and by the employer. Grissett testified that he again went through the process of mailing the form to his physician and waiting for the physician to complete it and mail it back, then having his wife take the form to his employer, and finally submitting the form to EBA. EBA received Grissett's second claim on February 16, 1993. EBA also considered this form to be late because it was filed more than four weeks after Grissett had submitted his first claim. Nevertheless, EBA paid the second claim also, sending Grissett a $585 check dated February 16, representing payment for 39 days of disability for the period January 6 through February 13. With the check, EBA sent Grissett another Form # 2. EBA also included a letter containing reminders to its members about the procedure for filing their claims, including the following:
Grissett testified that he thought the language in the reminder letter meant he *973 could get a check whenever he wanted it. He also testified that he did not interpret either the bylaws or the reminder letter to contain a requirement that claims be filed within exactly four weeks.
EBA received Grissett's third claim on April 5, 1993. This time, Prehn denied Grissett's claim because, he said, it was late and because Grissett had not heeded the reminder letter sent to him with his second check. On April 6, Prehn sent a letter to Grissett informing him that his claim had been denied because its submission "substantially exceed[ed] the time limit allowed in Item 7 page 16 of your By-Laws." Prehn's letter also stated: "If you would care to present your reason for delay to the Board of Trustees which is satisfactory to them we can at that time process your claim." Grissett then wrote Prehn a letter, in which he stated: "I see no requirement that form # 2, for continuing disability, be filed in 31 days. It looks to me that form # 2 can be filed whenever I want another check for disability." Prehn responded with a letter in which he emphasized the importance of an EBA member's following the rules for submitting claims. In a reply, Grissett argued that the "rules" did not state that the second claim form "must be in within 31 days." (Emphasis in Grissett's letter.) Grissett also pointed out to Prehn that he had had neurosurgery and was taking strong medication.
On May 10, Prehn sent Grissett a letter responding to certain of his questions. The letter then stated:
With the letter, Prehn included a $165 check dated May 10, representing Grissett's disability benefits for the period March 26 through April 5. Prehn also enclosed another EBA Form # 2 for Grissett to complete, and he stated: "Get it back to us within four weeks or [the checks] will stop again."
Grissett again went through the process of having the claim form completed. His physician and his employer signed the form on May 25 and May 28, respectively. EBA received the form on June 18. Prehn's secretary wrote a note in the file stating that the form was received eight days late. That claim was not paid.
On June 13, Grissett wrote a letter to the board of trustees, requesting that it consider the payment of his third claim. He stated that, in his opinion, the language in the bylaws about the claims-filing process was ambiguous because it stated that a claim form "should" be filed within four weeks, rather than stating that it "must" be. Grissett then explained to the board the difficulty he had had in complying with the four-week deadline:
Prehn submitted Grissett's claim to the secretary of EBA's board of trustees, who denied his appeal. Prehn explained at trial that he took this action because EBA policy called for the board's secretary to consider appeals that were filed between regularly scheduled meetings of the board. On June 22, Prehn notified Grissett that *974 the secretary had denied his appeal. On July 22, 1993, EBA's board of trustees considered Grissett's appeal and denied it. The board also amended EBA's bylaws during the July 1993 meeting to reflect that the time in which a member submits an EBA Form # 2 "must not exceed a four-week period."
During July and August, Grissett and Prehn exchanged additional letters regarding Grissett's appeal to the board and the disposition of his fourth and final claim. Grissett also cancelled his membership in EBA. Finally, on August 27, Prehn wrote the following letter to Grissett:
Grissett sued EBA, alleging breach of contract and bad-faith refusal to pay insurance claims. The case was tried to a jury. During the trial, the court denied Grissett's preverdict motion for a judgment as a matter of law ("JML")[2] on the contract claim. The court also denied EBA's preverdict motions for a JML on the contract claim and the bad-faith claim. The jury returned a verdict for Grissett, assessing compensatory damages at $880 and awarding punitive damages of $150,000. On February 13, 1997, the trial court entered a judgment in favor of Grissett for $150,880. On March 13, EBA moved for a JML, or, in the alternative, for a new trial or a remittitur. On April 17, the court held a hearing on EBA's postjudgment motion. That motion was denied on June 11 by operation of law pursuant to Rule 59.1, Ala. R. Civ. P.
EBA argues that the trial court erred in denying its preverdict and postverdict motions for a JML on Grissett's breach-of-contract and bad-faith claims. EBA also argues that the trial court erred in denying its motion for a new trial or remittitur because, it argues, the punitive damages award was excessive.
When reviewing a ruling on a motion for a JML, this Court uses the same standard the trial court used initially in granting or denying a JML. Palm Harbor Homes, Inc. v. Crawford, 689 So. 2d 3 (Ala.1997). Regarding questions of fact, the ultimate question is whether the non-movant has presented sufficient evidence to allow the case or the issue to be submitted to the jury for a factual resolution. Carter v. Henderson, 598 So. 2d 1350 (Ala. 1992). For actions filed after June 11, 1987, the nonmovant must present substantial evidence in order to withstand a motion for a JML. See § 12-21-12, Ala. *975 Code 1975; West v. Founders Life Assurance Co. of Florida, 547 So. 2d 870, 871 (Ala.1989). A reviewing court must determine whether the party who bears the burden of proof has produced substantial evidence creating a factual dispute requiring resolution by the jury. Carter, 598 So. 2d at 1353. In reviewing a ruling on a motion for a JML, this Court views the evidence in the light most favorable to the nonmovant and entertains such reasonable inferences as the jury would have been free to draw. Id. Regarding a question of law, however, this Court indulges no presumption of correctness as to the trial court's ruling. Ricwil, Inc. v. S.L. Pappas & Co., 599 So. 2d 1126 (Ala.1992).
In order to establish that a breach of contract has occurred, a plaintiff must prove: "(1) the existence of a valid contract binding the parties in the action, (2) his own performance under the contract, (3) the defendant's nonperformance, and (4) damages." Southern Medical Health Systems, Inc. v. Vaughn, 669 So. 2d 98, 99 (Ala.1995) (citations omitted). EBA argues that Grissett did not prove all of the elements that would have established a breach of contract; therefore, it says, it was entitled to a JML on the breach-of-contract claim. Grissett insists that he did prove all of the elements, and he argues that the trial court erred only to the extent that it did not grant his motion for a JML on that claim.
As to the first element, it is clear that a valid contract existed. "The constitution, bylaws, and regulations of a voluntary association constitute a contract between the association's members which is binding upon each member so long as the bylaws, etc., remain in effect." Scott v. East Alabama Educ. Foundation, Inc., 417 So. 2d 572, 573 (Ala.1982). Neither party argues that EBA and Grissett did not have a valid contract.
As to the second element, EBA argues that Grissett breached the contract by not adhering to the procedures in the bylaws regarding the timely submission of claim forms. Although Grissett repeatedly was unable to file the requisite forms within the times specified in the bylaws, the parties disputed the interpretation of the meaning of the provisions in the bylaws regarding the time frames established for submitting claims. If the terms of a contract are ambiguous in any way, the meaning of the contract presents a question of fact for the jury to resolve. McDonald v. U.S. Die Casting & Dev. Co., 585 So. 2d 853 (Ala.1991). Because the interpretation of the contract presented a jury question, the question whether Grissett performed his contractual obligations also was a jury question.
As to the third element, Prehn himself conceded that EBA had not fulfilled its contractual obligations, at least as to the fourth claim. After reviewing that claim at trial, Prehn testified that EBA's failure to pay the last claim was a mistake and that EBA "probably should have gone back and paid it in the correct way and maybe sent another Form 2 to do it correctly."
As to the fourth element, Grissett testified that he did not receive $880 in disability benefits to which he thought he was entitled.[3] He also testified that he had depended on the disability benefits to pay bills while he was unable to work and that he was under a great deal of stress wondering if EBA would pay the benefits.
We conclude that the trial court properly submitted the breach-of-contract claim to the jury.
In Chavers v. National Security Fire & Casualty Co., 405 So. 2d 1 (Ala.1981), this *976 Court, in a 5-to-4 decision, recognized a new tort action for the bad-faith failure to pay an insurance claim. Liability was grounded on either (1) the defendant's failure to pay the claim, with no lawful basis for the refusal, coupled with the defendant's knowledge of the fact that it had no lawful basis or (2) the defendant's intentional failure to determine whether there was any lawful basis for such refusal. 405 So. 2d at 7. In National Savings Life Insurance Co. v. Dutton, 419 So. 2d 1357 (Ala.1982), the Court modified those standards and recognized the "normal" versus the "abnormal" bad-faith case. In "normal" cases, the plaintiff's contract claim had to be so strong that the plaintiff would be entitled to a preverdict JML; if a fact issue made a JML inappropriate, then the defendant was entitled to a JML on the plaintiff's bad-faith claim. 419 So. 2d at 1362. Even so, a trial court's failure to enter a JML on the plaintiff's breach-of-contract claim is not fatal as long as the trial court correctly determines that the plaintiff has met the standard of proof required for a JML. Loyal American Life Ins. Co. v. Mattiace, 679 So. 2d 229, 235 n. 2 (Ala.), cert. denied, 519 U.S. 949, 117 S. Ct. 361, 136 L. Ed. 2d 252 (1996).
EBA points to the standard set out in National Security Fire & Casualty Co. v. Bowen, 417 So. 2d 179 (Ala.1982). That case set out these requirements for a plaintiff to prove a bad-faith failure to pay:
417 So. 2d at 183. Requirements (a) through (d) represent the "normal" case. Requirement (e) represents the "abnormal" case.
The rule in "abnormal" cases dispensed with the predicate of a preverdict JML for the plaintiff on the contract claim if the insurer had recklessly or intentionally failed to properly investigate a claim or to subject the results of its investigation to a cognitive evaluation. Blackburn v. Fidelity & Deposit Co. of Maryland, 667 So. 2d 661 (Ala.1995); Thomas v. Principal Financial Group, 566 So. 2d 735 (Ala.1990).[4] A defendant's knowledge or reckless disregard of the fact that it had no legitimate or reasonable basis for denying a claim may be inferred and imputed to an insurer when it has shown a reckless indifference to facts or proof submitted by the insured. Gulf Atlantic Life Ins. Co. v. Barnes, 405 So. 2d 916, 924 (Ala.1981).
So, a plaintiff has two methods by which to establish a bad-faith refusal to pay an insurance claim: he or she can prove the requirements necessary to establish a "normal" case, or, failing that, can prove that the insurer's failure to investigate at the time of the claim presentation procedure was intentionally or recklessly omissive. Moreover, in a "normal" case, the insurer cannot use ambiguity in the contract as a basis for claiming a debatable reason not to pay the claim. Otherwise, an insurer would have the incentive to write ambiguous polices in order to *977 create an absolute defense to a bad-faith claim. Blackburn, 667 So. 2d at 669.
Applying these standards, EBA first urges that it is not an insurance company and, therefore, that the inquiry ends here. We disagree. The relationship between the parties, whereby Grissett paid dues into EBA's membership fund, from which disability claims were payable pursuant to a written agreement between the parties, provides ample indicia of an agreement to which the doctrine of bad faith is applicable. See Schoepflin v. Tender Loving Care Corp., 631 So. 2d 909 (Ala.1993). The instant case is distinguishable from Peninsular Life Insurance Co. v. Blackmon, 476 So. 2d 87 (Ala.1985), where benefits were payable out of general operating revenue under an oral supplemental temporary-disability plan without any standards for the evaluation of claims.
Grissett's claims fell into two categories. One claim, for $615, was based upon a contention that EBA wrongfully denied his third request for benefits by treating that request as having been filed too late, under EBA's interpretation of its contract language. A second claim, for $270see note 3was based on a contention that EBA erroneously denied his fourth request for benefits even though it was not late. EBA maintains that Grissett failed to prove a breach of contract and that, on the contrary, Grissett himself breached the contract by not adhering to the policies and procedures set forth in the bylaws. EBA also asserts that Grissett failed to present sufficient evidence to prove that EBA intentionally refused to pay his claim and to prove that EBA did not have a debatable reason for refusing to pay, as required under National Security Fire & Casualty Co. v. Bowen, 417 So. 2d at 183.
With reference to the claim for $615, EBA says that after paying two claims that it considered untimely, it warned Grissett about the need for adherence to the time limits stated in the bylaws. The operative portion of the timeliness requirement as to supplemental claims is expressed as "should be filed" rather than as "must be filed." Grissett points out that after he had difficulties with EBA, the wording was changed from "should" to "must." However, "should" has been determined to be the equivalent to "it is your duty." Tidwell v. State, 40 Ala.App. 580, 581, 118 So. 2d 292, 293 (1960). At most, couching the duty in terms of "should" creates an ambiguity. The structure of the deadlines written into the bylaws was the subject of disputed interpretations, Grissett describing them in correspondence as ambiguous. The absence of a debatable reason not to pay a claim cannot be grounded on the vagaries of construction of an ambiguity. Blackburn v. Fidelity & Deposit Co. of Maryland so holds. 667 So. 2d at 669. The requirement imposed by National Savings Life Insurance Co. v. Duttonthat the plaintiff be entitled to a directed verdict on the breach-of-contract claimis limited to the "normal" case, and it does not apply when the contract of insurance has an ambiguity. 419 So. 2d at 1362. As it regards the $615 claim, the contract at issue in this case has an ambiguity.
With reference to the claim for $270, Grissett elicited admissions that EBA should have paid that final claim. Because Grissett thus proved a breach of contract as to the claim submitted in the fourth EBA Form # 2 (on which the defendant admitted owing benefits of $15 per day for 18 days for a total of $270), he successfully proved the elements necessary for the first method of establishing a bad-faith refusal to pay an insurance claim (the "normal" case). Whether to accept the defendant's self-serving statement that it had made a "mistake" in failing to pay was a question for the jury.
Grissett also elicited from Prehn an admission that EBA had not investigated his claims and statements suggesting that EBA's review procedures lacked depth. Prehn's testimony included the following:
Under the evidence, the jury also could have found that Grissett's appeals to the secretary and then to the board were not properly and fairly consideredthat any consideration they received was merely superficial.
We conclude that Grissett also proved the elements necessary for the second method of establishing a bad-faith refusal to pay an insurance claimhe presented evidence from which the jury could find that EBA recklessly or intentionally failed to properly investigate his claim or to subject the results of an investigation to a cognitive evaluation. The trial court properly submitted the bad-faith claim to the jury.
Before we discuss EBA's arguments regarding the award of punitive damages, we note that what was once thought to be a rarely applicable remedy, recovery for the tort of an insurer's bad-faith failure to pay a claim, appears now with great frequency.[5] The result in this present case should give no comfort to those who, almost 20 years ago, saw a narrow niche for the new tort. Concern over the present status of the remedy is expressed in Stephen D. Heninger and Nicholas W. Woodfield, "A Practitioner's Guide to Alabama's Tort of Bad Faith," Alabama Lawyer, September 1996. For a general analysis of current trends, see John H. Bauman, "Emotional Distress Damages and the Tort of Insurance Bad Faith," 46 Drake L.Rev. 717 (1998); Alan O. Sykes, "`Bad Faith' Breach of Contract by First-Party Insurers," 25 J. Legal Stud. 405 (1996); and Douglas R. Richmond, "An Overview of Insurance Bad Faith Law and Litigation," 25 Seton Hall L.Rev. 74 (1994).
We now must consider the defendant's arguments concerning the amount of punitive damages awarded. EBA argues that even if it was not entitled to a JML, it is entitled to a new trial or at least to a remittitur of the punitive damages award because, it insists, the punitive damages award was excessive.
EBA challenges the punitive damages award both on the basis of the "guide-posts" established by the United States Supreme Court in BMW of North America, Inc. v. Gore, 517 U.S. 559, 116 S. Ct. 1589, 134 L. Ed. 2d 809 (1996) ("Gore I"), and on the basis of the factors this Court set out in Hammond v. City of Gadsden, 493 So. 2d 1374 (Ala.1986), and Green Oil Co. v. Hornsby, 539 So. 2d 218 (Ala.1989). In other words, EBA argues that the award exceeds any amount justified by the evidence and thus is a denial of due process. In reviewing a punitive damages award, this Court considers the "guide-posts" established in Gore I and the factors set out in Hammond and Green Oil that pertain to the question of excessiveness. BMW of North America, Inc. v. *979 Gore, 701 So. 2d 507 (Ala.1997) (on remand from the United States Supreme Court) ("Gore II").
We first analyze the punitive damages award pursuant to the guideposts established by the United States Supreme Court in Gore I.
"Perhaps the most important indicium of the reasonableness of a punitive damages award is the degree of reprehensibility of the defendant's conduct." Gore I, 517 U.S. at 575, 116 S. Ct. 1589. Although the Supreme Court did not provide any definitive rule by which to measure reprehensibility, it acknowledged that trickery and deceit are more reprehensible than negligence and that affirmative conduct, such as a deliberate false representation, is more reprehensible than the misconduct encompassed by an innocent representation. Id.
This present case involves no false representations. Immediately upon receiving his third claim, EBA informed Grissett that it would be denied because it was late. When Grissett challenged the denial, EBA stood by its decision, based upon its interpretation of its bylaws. While EBA's conduct may have been dogmatic, Grissett presented no evidence that EBA acted with any malicious intent to injure him. Moreover, EBA apparently operates its disability fund with no profit motive. The degree of reprehensibility in this case is low.
A second indicium of either reasonableness or excessiveness is the ratio between the punitive damages award and the actual harm to the plaintiff. Gore I, 517 U.S. at 580, 116 S. Ct. 1589. The guaranty of due process does not require that this Court apply a mathematical formula to determine whether a punitive damages award is excessive; therefore, a remittitur generally is not justified solely on the basis of a high ratio. The ratio between the compensatory and punitive damages awards must be reasonable; however, a higher ratio may be justified in cases in which the harm to the plaintiff is hard to detect or the monetary value of noneconomic harm is difficult to determine. Id. This Court has found constitutionally acceptable ratios ranging from 1:1 in Ford Motor Co. v. Sperau, 708 So. 2d 111 (Ala.1997), to 121:1 in Foremost Insurance Co. v. Parham, 693 So. 2d 409 (Ala. 1997).
The punitive award of $150,000 is 170 times the compensatory award of $880. That 170:1 ratio is unacceptable. We have in this case an employees' association, not operated for profit and providing nominal benefits for modest dues, being held to the standards of a business regulated by the insurance laws of this state. EBA clearly is not such a business.
We know of no civil or criminal penalties that could have been imposed in this case.
Our analysis of the Gore I guideposts, particularly the low level of reprehensibility and the high ratio between punitive and compensatory damages, indicates that the punitive damages award was excessive.
We now consider the factors enumerated by this Court in Hammond and Green Oil.
"`Punitive damages should bear a reasonable relationship to the harm that is likely to occur from the defendant's conduct as well as to the harm that actually has occurred. If the actual or likely harm is slight, the damages should be relatively small. If grievous, the damages should be *980 much greater.'" Green Oil, 539 So. 2d at 223, quoting Aetna Life Insurance Co. v. Lavoie, 505 So. 2d 1050, 1062 (Ala.1987) (Houston, J., concurring specially).
EBA's denial of two of Grissett's disability claims caused him to lose the income upon which he testified he was depending during the period in which he could not work. Although the actual amount of the disability income Grissett would have received is relatively small, he testified that he worried about the status of his claims during the time when he was trying to recover from major surgery. However, the jury did not award Grissett compensatory damages other than in the amount of his claims.[6]
Furthermore, the evidence reflects that an EBA member in Grissett's circumstances had virtually no chance of complying with the claims procedure established by EBA's bylaws. The member could do nothing until he had received EBA Claim Form # 2 in the mail with his check for the previous claim. In Grissett's case, he then had to begin the process of getting the form completed by his physician and his employer during a time when he could not drive. He testified that he had to rely upon the mail to get the form to and from his physician in Birmingham and that he had to wait for his physician to have time to complete the form. Grissett's wife then had to take the form to his employer. Finally, Grissett could mail the form to Portland, but, he said, mail between Alabama and Oregon usually took four to five days. In the case of Grissett's fourth claim, he did not even receive the claim form until after the four-week period already had run.
We believe the evidence supports an award of more than token punitive damages; therefore, this factor weighs against a finding of excessiveness of the punitive damages award.
Our assessment of the degree of the reprehensibility of the defendant's conduct is broader in a Hammond/Green Oil review than our assessment in a Gore I review. At this point, we consider "`[t]he duration of this conduct, the degree of the defendant's awareness of any hazard which his conduct has caused or is likely to cause, and any concealment or "cover up" of that hazard, and the existence and frequency of similar past conduct.'" Green Oil, 539 So. 2d at 223.
The reprehensibility of EBA's conduct lies in EBA's dogmatic adherence to rules and bylaws that are inartfully drafted and therefore unworkable. Prehn consistently testified that he denied Grissett's final two claims because Grissett "didn't follow the rules." Because EBA had so many members, Prehn said, it held its members to a "high degree of conformity" in order to keep its costs down. Prehn also relied upon the importance of a member's following the rules when he testified that EBA could not investigate a member's individual circumstances before deciding to deny a claim. Nevertheless, the evidence indicates that EBA's attempts to enforce its rules at Grissett's expense were merely clumsy and dogmatic, not malicious. There was no evidence at all to indicate that EBA tried to conceal its actions.
Although EBA's conduct supports an award of more than token punitive damages, it does not reflect the degree of reprehensibility, often marked by greed, that has been the basis of large punitive damages awards in the past. Therefore, this factor weighs in favor of a finding that the punitive damages award was excessive.
If the defendant's wrongful conduct was profitable, then we consider whether the punitive damages award removes the profit and whether it exceeds the profit so that the defendant recognizes a loss. Green Oil, 539 So. 2d at 223. There is no evidence that EBA recognized any profit from its failure to pay Grissett's claims. To the extent that EBA may have profited, it is clear that the punitive damages award not only removed any profit, but far exceeded it. Therefore, this factor weighs in favor of a finding of excessiveness.
The record contains no specific evidence regarding EBA's financial position. During the hearing on its postjudgment motion, however, EBA's attorney stipulated that it would not be crippled financially if it had to pay the punitive damages award. Therefore, this factor weighs against a finding of excessiveness.
We must also consider whether the punitive award sufficiently rewarded the plaintiffs counsel for assuming the risk of bringing the lawsuit and encouraged other plaintiffs to bring wrongdoers to trial. Green Oil, 539 So. 2d at 223. Grissett's lawyer presented no evidence to indicate that costs in this matter were excessive. The case action summary does not reflect an excessive amount of pretrial activity and the case culminated in a two-day trial. Based upon the lack of evidence presented, therefore, we conclude that this factor weighs neither for nor against a finding of excessiveness.
No criminal sanctions have been imposed upon EBA; therefore, this factor is inapplicable.
The record does not suggest that any other civil actions have been filed against EBA. Therefore, this factor weighs against a finding of excessiveness.
Summary of the Hammond/Green Oil analysis:
After considering the seven Hammond/Green Oil factors, we conclude that one of the factors is inapplicable and that one is neutral as to the issue of excessiveness. Two of the factors weigh in favor of a finding of excessiveness: the degree of reprehensibility of EBA's conduct and the degree to which EBA profited. Three of the factors weigh against a finding of excessiveness: the relationship of the damages award to the harm done to Grissett or likely to be done to him, EBA's financial position, and the lack of any other civil actions against EBA.
We now return to a final consideration of the excessiveness of the punitive damages award in light of Gore I. A punitive damages award of $15,000 would reduce the ratio of punitive damages to compensatory damages to 17:1. Based on the low degree of reprehensibility of EBA's conduct, coupled with Grissett's modest economic loss and the absence of any compensatory award for loss or harm other than the denied benefits, such as any award for pain and suffering, we conclude that a $15,000 punitive damages award would be sufficient to punish EBA and to deter it from further conduct similar to that evidenced in this case, without compromising its due process rights.
The judgment is affirmed on the condition that Grissett file with this Court within 21 days a remittitur of punitive damages to the sum of $15,000; otherwise, the judgment will be reversed and the cause remanded for a new trial.
*982 AFFIRMED CONDITIONALLY.[*]
HOOPER, C.J., and SHORES and HOUSTON, JJ., concur.
MADDOX, J., concurs in the result.
KENNEDY, J., concurs in part and dissents in part.
SEE, J., concurs in part, concurs in the result in part, and dissents in part.
MADDOX, Justice (concurring in the result).
I concur in the result. I write specially only to state that in view of the United States Supreme Court's holding in BMW of North America, Inc. v. Gore, 517 U.S. 559, 116 S. Ct. 1589, 134 L. Ed. 2d 809 (1996), and its remand orders in Union Security Life Ins. Co. v. Crocker, 517 U.S. 1230, 116 S. Ct. 1872, 135 L. Ed. 2d 169 (1996), and American Pioneer Life Ins. Co. v. Williamson, 517 U.S. 1231, 116 S. Ct. 1872, 135 L. Ed. 2d 169 (1996), it may be time for this Court to look again at the history of the establishment of the tort of bad-faith failure to pay an insurance claim and to consider replacing it with a more appropriate remedy.
The tort of bad-faith failure to pay an insurance claim was created by this Court, in a 5-to-4 decision, in Chavers v. National Security Fire & Casualty Co., 405 So. 2d 1 (Ala.1981). The tort was subsequently modified in National Savings Life Insurance Co. v. Dutton, 419 So. 2d 1357 (Ala. 1982).[7]
From the beginning, I have recognized that our law provided inadequate remedies in many cases involving an insurer's breach of an insurance contract, but I dissented in Chavers because I did not believe the remedy created in that case was the most appropriate remedy for the wrong alleged. Although I dissented in Chavers, I have always recognized the need for legislative or judicial action to fill the void in the case where an insurer wrongfully refuses to pay a legitimate claim under a policy. The proliferation of cases alleging bad-faith failure to pay and the size of jury verdicts suggest that remedial measures were in order, but we should ask whether the most appropriate remedy was to recognize the tort of bad faith and to allow juries unbridled discretion to award punitive damages. I did not think so.
I joined Chief Justice Torbert's dissenting opinion in Aetna Life Ins. Co. v. Lavoie, 470 So. 2d 1060 (Ala.1984), in which he suggested an alternative remedy:
470 So. 2d at 1078-80. It seems to me that former Chief Justice Torbert, in his dissent in Aetna, pointed out many of the problems associated with awards of punitive damages in cases involving first-party insurance claims, problems the Supreme Court of the United States mentioned in BMW v. Gore, supra.
Given the requirements of BMW v. Gore, I suggest that it very well may be appropriate for this Court, or for the Legislature, to reexamine the tort of bad-faith failure to pay and to do so in light of what former Chief Justice Torbert said in his dissenting opinion in Aetna v. Lavoie 14 years ago.[8]
*985 KENNEDY, Justice (concurring in part and dissenting in part).
I concur in the holding that the trial court properly submitted the plaintiff's bad-faith and breach-of-contract claims to the jury. However, I dissent from that part of Justice Lyons's opinion holding that the jury's award of punitive damages should be reduced by 90%from $150,000 to $15,000.
SEE, Justice (concurring in part, concurring in the result in part, and dissenting in part).
I concur in Part I.A. of the main opinion regarding the breach of contract claim. See McDonald v. U.S. Die Casting & Dev. Co., 585 So. 2d 853 (Ala.1991). I join Justice Maddox's opinion concurring in the result with respect to Part I.B. of the main opinion, regarding the bad-faith-failure-to-pay claim. See Aetna Life Ins. Co. v. Lavoie, 470 So. 2d 1060, 1078 (Ala.1984) (Torbert, C.J., dissenting). I concur in that portion of Part II. of the main opinion holding that the punitive damages award is excessive.
I respectfully dissent, however, from that portion of Part II. of the main opinion holding that a $15,000 punitive award would be appropriate. If the defendant's conduct is reprehensible at all, then, as the main opinion recognizes, "[t]he degree of reprehensibility in this case is low." 732 So. 2d at 979. Further, no combination of factors justifies an extraordinary punitive award. Nonetheless, the main opinion approves a 17:1 ratio of punitive damages to compensatory damages. 732 So. 2d at 981. I would approve no more than a 3:1 ratio of punitive damages to compensatory damages, based on the rationale I set forth in Life Insurance Co. of Georgia v. Johnson, 701 So. 2d 524, 535 (Ala.1997) (See, J., concurring in part and dissenting in part). Accord Union Sec. Life Ins. Co. v. Crocker, 709 So. 2d 1118, 1125 (Ala.1997) (See, J., dissenting) (noting the arbitrary amounts of punitive awards approved by this Court since BMW of North America, Inc. v. Gore, 517 U.S. 559, 116 S. Ct. 1589, 134 L. Ed. 2d 809 (1996)), cert. denied, ___ U.S. ___, 118 S. Ct. 1515, 140 L. Ed. 2d 668 (1998).
[1] On his initial claim form, Grissett stated that his disability began on December 5, 1992; however, his doctor's portion of the form stated that Grissett's disability began on December 7. EBA treated the disability as beginning on December 7.
[2] Effective October 1, 1995, Rule 50, Ala. R. Civ. P., was amended, as a matter of form only, so as to rename "motions for directed verdict" and "motions for judgment notwithstanding the verdict" as "motions for judgment as a matter of law." Rather than continue to use the terminology of the former rule, which terminology sometimes is used in the briefs and the record in this proceeding, we have used in this opinion the terms used in the amended rule.
[3] Grissett testified that he was due a total of $880 in benefits, for 59 days of disability, that EBA refused to pay. We note, however, that the correct calculation of benefits for 59 days of disability at $15 per day would have been $885.
[4] We have come very far from Justice Jones's concurrence in Continental Assurance Co. v. Kountz, 461 So. 2d 802, 810 (Ala.1984), where he expressed concern that indiscriminate references to recklessness might cause confusion that could lead to the imposition of liability for bad faith without proof of an intentional injury.
[5] Compare the reference to "rare and extreme cases" in Waldon v. Cotton States Mutual Insurance Co., 481 So. 2d 340, 341 (Ala. 1985), with the observation in United Insurance Co. of America v. Cope, 630 So. 2d 407, 412 (Ala.1993), that rarity of bad-faith claims has not been the experience.
[6] We will not parse the record for evidence of mental anguish in an attempt to reduce the ratio between compensatory and punitive damages when the jury has not awarded damages for such harm. Compare Life Ins. Co. of Georgia v. Smith, 719 So. 2d 797 (Ala.1998) (holding that the Court will not parse the record for evidence of compensatory or nominal damage to justify an award of punitive damages only).
[*] Note from the reporter of decisions: On January 6, 1999, the Supreme Court issued the following order:
"This Court having been advised by the appellee, Richard D. Grissettt, on or about December 28, 1998, that he elects not to accept the remittitur,
"IT IS ORDERED that the judgment of the trial court is reversed and the cause is remanded for new trial pursuant to this Court's opinion of September 11, 1998."
[7] In Dutton, this Court set out the elements of the tort and stated that in the "normal case" a cause of action would not be judicially recognized if there was a fact issue concerning the plaintiff's contract claim.
[8] On several occasions I have suggested that there are attractive alternatives to the tort of bad-faith failure to pay, and I have even suggested in one opinion that the Legislature might consider providing an alternative remedy. See Loyal American Life Ins. Co. v. Mattiace, 679 So. 2d 229 (Ala.1996) (Maddox, J., dissenting); Independent Fire Ins. Co. v. Lunsford, 621 So. 2d 977 (Ala.1993) (Maddox, J., concurring in part; dissenting in part); Aetna Life Ins. Co. v. Lavoie, 505 So. 2d 1050 (Ala. 1987) (Maddox, J., concurring specially); and Continental Assurance Co. v. Kountz, 461 So. 2d 802 (Ala.1984) (Maddox, J., dissenting). | 3a5aec801123662a876244066ce109d5576b3d3d6811c168f0efcc6234115d0f | 1998-09-11 00:00:00 |
3c5d5c4c-89be-4907-86e2-d6eb474187b2 | Ex Parte Jenkins | 723 So. 2d 649 | 1961520, 1961531 | Alabama | Alabama Supreme Court | 723 So. 2d 649 (1998)
Ex parte Willson JENKINS, guardian ad litem for minor child J.B.
Ex parte State of Alabama ex rel. C.T.G.
(Re State ex rel. C.T.G. v. M.A.B.; and Guardian ad litem for minor child J.B. v. M.A.B.)
1961520 and 1961531
Supreme Court of Alabama.
July 17, 1998.
*650 R. Willson Jenkins of Jester & Jenkins, P.C., Florence, guardian ad litem for petitioner J.B.
J. Coleman Campbell and Lois Brasfield, asst. attys. gen., Department of Human Resources, for petitioner State ex rel. C.T.G.
No brief filed for respondents.
SEE, Justice.
These petitions concern the reopening of a final judgment of paternity. The trial court allowed a man who had previously been adjudicated the father of a child to proffer deoxyribose nucleic acid ("DNA") evidence indicating that he was not the child's biological father. The trial court reopened the judgment of paternity, pursuant to Ala.Code 1975, § 26-17A-1; entered an order finding the previously adjudicated father not to be the child's biological father; and set aside the earlier order requiring him to pay child support. The Court of Civil Appeals affirmed. State ex rel. C.T.G. v. M.A.B., 723 So. 2d 644 (Ala. Civ. App.1997). We granted the petitions of the guardian ad litem and the State for certiorari review. We hold that the previously adjudicated father's action was not barred by the statute of limitations; that he is not entitled to relief under § 26-17A-1 because the statute, if applied retroactively, would violate the separation-of-powers principle, *651 but that he may be entitled to relief under Rule 60(b), Ala. R. Civ. P. Therefore, we reverse and remand.
C.T.G. (the mother) and M.A.B. (the previously adjudicated father) were divorced on October 1, 1984. Immediately following her divorce from M.A.B., the mother learned she was pregnant. The child, J.B., was born six and one-half months after the divorce.
In 1985, the State, on behalf of C.T.G., filed a paternity action, asking the court to declare M.A.B. the father. M.A.B. acknowledged paternity. The paternity judgment became final in 1986. The trial court ordered M.A.B. to pay $25 per week in child support.
In December 1995, the State, on behalf of the mother, petitioned for an increase in child support. M.A.B. responded and sought to reopen the 1986 paternity judgment, pursuant to § 26-17A-1 and Rule 60(b), alleging that he had received information that at the time of conception the mother was engaged in a sexual relationship with another man. After a hearing, the court took the matter under advisement. While the ruling was pending, M.A.B had DNA testing performed on himself and on J.B. The test results excluded M.A.B as the biological father of J.B.; M.A.B. notified the trial court of the test results, and the trial court ordered additional testing, over the objections of both the State and the guardian ad litem for J.B. The subsequent testing also indicated that M.A.B. was not the biological father of J.B. In 1996, the trial court reopened the 1986 paternity judgment, pursuant to § 26-17A-1, and then held that M.A.B. was not the father and was not liable for child support. The Court of Civil Appeals affirmed. In their petitions for certiorari review, the State and the guardian ad litem make numerous arguments; those arguments are best understood in the context of the history leading up to the enactment of § 26-17A-1.
In 1984, the Alabama Legislature passed the Alabama Uniform Parentage Act. Ala. Acts 1984, Act No. 84-244, p. 375 (codified as amended at Ala.Code 1975, § 26-17-1 to -22). Section 26-17-5(a)(1) creates a presumption of paternity between a man and a child born during the man's marriage to the child's mother or born within 300 days after the termination of the marriage. Section 26-17-5(b) provides that a presumption of paternity can be rebutted in an action by "clear and convincing evidence" that the presumed father is not the biological father.
Until 1994, if an action to establish the existence of a presumed paternity relation had been reduced to a final judgment subject to the principles of res judicata, the presumed father could ask a court to reopen that final judgment only under Rule 60(b), Ala. R. Civ. P. Under Rule 60(b)(6), Alabama courts allowed a previously adjudicated father, who obtained blood test evidence or DNA evidence indicating that he was not the biological father, to reopen a final judgment of paternity. The previously adjudicated father, however, was required to make his motion to reopen the final judgment within a "reasonable time" after discovering reason to doubt his paternity. See, e.g., K.W. v. State ex rel. S.G., 581 So. 2d 855 (Ala.Civ.App.1991) (holding that a previously adjudicated father could challenge a 4-year-old paternity judgment because he acted within a "reasonable time" of learning that he might not be the father); Ex parte State ex rel. McKinney, 567 So. 2d 366 (Ala.Civ.App.1990) (holding that a previously adjudicated father could challenge a 12-year-old paternity judgment because he challenged it within a "reasonable time" after learning of his sterility). In 1993, however, this Court denied Rule 60(b)(6) relief to a man who challenged a 9-year-old paternity judgment with DNA evidence that showed he was not the biological father. Ex parte W.J., 622 So. 2d 358, 360 (Ala.1993). Because the man had had reason to doubt his paternity at the time of the original proceeding, but had failed to act within a "reasonable time," the previous paternity judgment was res judicata. Id. at 362.
In 1994, apparently in reaction to this Court's denial of relief in W.J., supra, on res judicata grounds, the Legislature enacted § 26-17A-1. See City of Birmingham v. Hendrix, 257 Ala. 300, 307, 58 So. 2d 626, 633 (1952) (stating that in attempting to discern *652 the legislative intent of a statute, it is permissible to examine the law as it existed before the statute was enacted). Section 26-17A-1 provides in pertinent part:
(Emphasis added.)[1] Under § 26-17A-1(a), a previously adjudicated father can petition for a reopening of the final judgment of paternity, without regard to the "reasonable time" requirement of Rule 60(b)(6), if he presents scientific evidence indicating that he is in fact not the biological father. Of course, the trial court must determine that the evidence is indeed scientifically valid and therefore reliable. See generally Turner v. State, [Ms. 1952024, January 16, 1998] ___ So.2d ___ (Ala.1998) (discussing the definition of "scientific" evidence).
The State contends that the reopening procedure of § 26-17A-1 is not available to M.A.B., because, it argues, the five-year limitations period of § 26-17-6(a), a part of the Alabama Uniform Parentage Act, bars this action to establish the nonexistence of paternity presumed under § 26-17-5(a)(1). We disagree.
Section 26-17-6(a) provides that a mother, a child, or a presumed father may, within five years of the child's birth, bring an action to establish the "existence" of the paternity relationship presumed under § 26-17-5(a)(1). The State contends that the five-year limitations period of § 26-17-6(a) prohibits an action brought by a presumed father to establish the nonexistence of paternity presumed under § 26-17-5(a)(1). A plain reading of § 26-17-6(a) and (b) refutes this contention. Section 26-17-6(a) and (b) provide:
(Emphasis added.)
Section 26-17-6(a) expressly limits to five years after a child's birth an action to declare the "existence" of the father and child relationship presumed under § 26-17-5(a)(1), (2), or (3). Had the Legislature intended the same five-year limitations period to apply to an action to establish the "non-existence" of the relationship, it would have included the term "non-existence" in § 26-17-6(a), as it did in § 26-17-6(b). The choice to exclude the word "non-existence" in § 26-17-6(a) indicates that the Legislature did not intend to impose a strict five-year limitations period on actions brought to challenge a presumption of paternity. See Commonwealth v. O'Brien, 390 Pa. 551, 136 A.2d 451 (1957) (holding that a statute providing for blood testing in "any proceeding to establish paternity" did not authorize blood tests in a proceeding by the putative father to challenge paternity); see generally House v. Cullman County, 593 So. 2d 69, 75 (Ala.1992) (stating that a court should not arbitrarily disregard marked differences in terminology, but should infer that material differences in language in different clauses of a statute were not inadvertent).[2]
The child's guardian ad litem argues that the legislative command of § 26-17A-1that trial courts reopen final judgmentsimpinges on the judicial power to render final judgments, thereby violating the separation-of-powers principle embodied in §§ 42 and 43 of the Constitution of Alabama of 1901.[3] Sections 42 and 43 mandate that the three principal powers of government shall be exercised by separate departments. Section 42 provides:
Section 43 provides:
*654 The separation-of-powers principle embodied in §§ 42 and 43 may be traced to the French political philosopher Montesquieu. In 1748, Montesquieu posited the political maxim that an individual's liberty depends directly upon separation of the legislative, executive, and judicial powers of government. Montesquieu stated:
Montesquieu, The Spirit of the Laws 157 (Cohler et al. trans., Cambridge Univ. Press 1989).[4] Expounding on the proposed federal Constitution's embodiment of Montesquieu's separation-of-powers principle, James Madison stated:
The Federalist No. 51, at 322-23 (James Madison) (Clinton Rossiter ed., 1961) (emphasis added).
The People of the United States, and the People of Alabama, transformed Montesquieu's maxim from political philosophy into fundamental law by ratifying Constitutions that expressly vest the three great powers of government in three separate branches. See U.S. Const. art. I, § 1 (vesting the legislative power in Congress); id. at art. II, § 1, cl. 1 (vesting the executive power in the President); id. at art. III, § 1 (vesting the judicial power in the Supreme Court and inferior federal courts); Ala. Const.1901, § 44 (vesting the legislative power in the Legislature); id. at § 113 (vesting the executive power in the Governor); id. at amend. 328, § 6.01(a) (vesting the judicial power in the Unified Judicial System). The political maxim posited by Montesquieu and embodied in the United States and Alabama Constitutions as a fundamental legal principle mandates that no branch of government be allowed to exercise any power vested in another branch and not vested in it. Since the ratification of the federal and Alabama Constitutions, the application of the separation-of-powers principle in actual cases has constructed the specific boundaries that separate the powers of the three branches of government. See, e.g., Youngstown Sheet & Tube Co. v. Sawyer, 343 U.S. 579, 72 S. Ct. 863, 96 L. Ed. 1153 (1952) (holding that President Truman's seizure of the nation's steel *655 mills was an invalid usurpation of the legislative power); Buckley v. Valeo, 424 U.S. 1, 96 S. Ct. 612, 46 L. Ed. 2d 659 (1976) (holding that Congress's appointment of purely executive officers to the Federal Election Commission was an invalid usurpation of the executive power); United States v. Klein, 80 U.S. (13 Wall.) 128, 20 L. Ed. 519 (1871) (holding that Congress's prescription of rules of decision for Article III courts was an invalid usurpation of the judicial power); Pennsylvania v. Wheeling & Belmont Bridge Co., 59 U.S. (18 How.) 421, 431, 15 L. Ed. 435 (1855) (recognizing that an act of Congress cannot annul a judgment of the Supreme Court that finally determines the rights of private parties).[5]
This Court has held that an attempt by the Legislature to reopen previously rendered final judgments violated the Alabama Constitution's separation-of-powers principle:
Sanders v. Cabaniss, 43 Ala. 173, 186 (1869) (emphasis added);[6]id. at 184 (citing Wheeling & Belmont Bridge Co., 59 U.S. (18 How.) at 431). Accord Broadway v. State, 257 Ala. 414, 60 So. 2d 701 (1952) (holding that a statute requiring courts to grant new criminal trials impermissibly impinged on the judicial power).
Under the federal constitution, the Supreme Court of the United States has held that three types of legislation violate the separation-of-powers principle by encroaching on the judicial power. Plaut v. Spendthrift Farm, Inc., 514 U.S. 211, 218-19, 115 S. Ct. 1447, 131 L. Ed. 2d 328 (1995). First, legislation that prescribes rules of decision for the Judiciary is, under certain circumstances, unconstitutional. Id. at 218, 115 S. Ct. 1447 (citing Klein, 80 U.S. (13 Wall.) 128, 20 L.Ed. 519). Second, legislation that requires the review of judicial decisions by the other branches of government is impermissible. Plaut, 514 U.S. at 218, 115 S. Ct. 1447 (citing Hayburn's Case, 2 U.S. (2 Dall.) 408 (1792)). Third, legislation that would change the law incorporated into a final judgment rendered by the Judiciary violates the separation-of-powers principle. Plaut, 514 U.S. at 218-19, 115 S. Ct. 1447.
In Plaut, 514 U.S. at 225, 115 S. Ct. 1447, the Supreme Court applied the third component of the separation-of-powers principle to strike down a statute that required courts to reopen judgments that had previously become final. The Supreme Court elaborated on the third component of the separation-of-powers principle as it affected the contours of the judicial power:
Plaut, 514 U.S. at 218-19, 115 S. Ct. 1447 (second emphasis added).[8]
The Supreme Court continued:
Plaut, 514 U.S. at 227, 115 S. Ct. 1447 (emphasis in original) (citations omitted). Thus, the core judicial power is the power to declare finally the rights of the parties, in a particular case or controversy, based on the law at the time the judgment becomes final. In the words of the Supreme Court:
Plaut, 514 U.S. at 234, 115 S. Ct. 1447. Therefore, to the extent § 26-17A-1 is applied retroactively to change the reopening provisions incorporated into paternity judgments that became final before that section was enacted, it impinges on the core judicial power.[9]
*657 This conclusion is buttressed by the Plaut Court's rejection of the argument that Congress could amend Rule 60(b), Fed.R.Civ.P., to reopen final judgments retroactively.[10] While the Plaut Court recognized that Congress could amend Rule 60(b), Fed.R.Civ. P.,[11] it stated that to give such an amendment retroactive effect would impermissibly change the law that was incorporated into the final judgment. Plaut, 514 U.S. at 234-37, 115 S. Ct. 1447.[12]
*658 Similarly, the Alabama Legislature cannot retroactively amend Rule 60(b), Ala. R. Civ. App., to change the law of finality that was incorporated into final judgments before the Legislature's amendment. The paternity judgment in this case became final in 1986, approximately eight years before § 26-17A-1 became law. Thus, the trial court and the Court of Civil Appeals erred in applying § 26-17A-1 to change the rules of finality incorporated into M.A.B.'s 1986 final judgment of paternity.[13]
Although retroactive application of § 26-17A-1 to reopen final judgments would violate the separation-of-powers principle by encroaching on the core judicial power, to the extent that § 26-17A-1 is applied only prospectively to judgments that have become final since that section was enacted there is no violation of the separation-of-powers principle. The Supreme Court has stated, "Congress could undoubtedly enact prospective legislation permitting, or indeed requiring, this Court to make equitable exceptions to an otherwise applicable rule of finality, just as district courts do pursuant to Rule 60(b)." Plaut, 514 U.S. at 237, 115 S. Ct. 1447 (emphasis original). Accord Sanders, 43 Ala. at 180 (discussing the separation-of-powers principle and stating, "`[T]o declare what the law is, or has been, is a judicial power; to declare what the law shall be, is legislative.' ") (quoting Thomas M. Cooley, Constitutional Limitations 91-95 (1868)). Similarly, the Alabama Legislature may amend Rule 60(b), Ala. R. Civ. P., but it may not do so in a manner that impinges on the judicial power by retroactively changing the laws that were incorporated into the judgment when it became final.
In Board of Education of Choctaw County v. Kennedy, 256 Ala. 478, 482, 55 So. 2d 511, 514 (1951), this Court stated: "`It is the duty of the court to construe a statute so as to make it harmonize with the constitution if this can be done without doing violence to the terms of the statute and the ordinary canons of construction.'" (Quoting Almon v. Morgan County, 245 Ala. 241, 246, 16 So. 2d 511, 516 (1944)). This Court has long recognized:
Greenwood v. Trigg, Dobbs & Co., 143 Ala. 617, 619, 39 So. 361, 361 (1905) (emphasis added) (citation omitted). Accord In re Moneys Deposited in and Now Under the Control of the United States District Court for the Western District of Pennsylvania, 243 F.2d 443, 448 (3d Cir.1957) ("[A] prospective construction is the more appropriate where as here it will eliminate a serious question of constitutional validity which would arise if the statute were to be given retroactive effect."); Norman J. Singer, Sutherland Statutory Construction, § 41.04 (5th ed. 1991) ("The principal explanation offered by the courts is that the statute must be construed to sustain its constitutionality and thus prospective operation will be presumed where a retroactive operation would produce invalidity."). Thus, if § 26-17A-1 can reasonably be construed to operate prospectively, a holding of constitutional infirmity can be avoided.
The statutes struck down in Plaut and in Sanders expressly required retroactive operation.[14] In contrast, the act codified at § 26-17A-1 does not expressly require retroactive operation, but instead provides: "This act shall become effective immediately upon its passage and approval by the Governor, or upon its otherwise becoming a law." Ala. Acts 1994, Act No. 94-633, § 4. Accordingly, we construe § 26-17A-1 to eliminate the "reasonable time" limitations period of Rule 60(b)(6) only for those judgments of paternity that become final on or after April 26, 1994, when that section became law.
Although § 26-17A-1 is not available to M.A.B., whose paternity judgment became final in 1986, Rule 60(b)(6), which was incorporated into that judgment, is available to M.A.B. Rule 60(b)(6), unlike § 26-17A-1, requires a previously adjudicated father to make a motion to reopen the judgment "within a reasonable time."[15] Previously, this Court has rigidly interpreted the "reasonable time" limitation of Rule 60(b), holding that a "reasonable time" began to run when a previously adjudicated father had any reason to doubt that he was the biological father. See, *660 e.g., W.J., 622 So. 2d at 362 (holding that the reasonable time allowed by Rule 60(b)(6) began to run when the previously adjudicated father had some reason to doubt that he was the biological father).
Upon further consideration, we believe that in a paternity case a trial court should apply equitable principles, including the doctrine of laches, in determining when the "reasonable time" allowed by Rule 60(b)(6) begins to run and when it expires. See, e.g., Merrill v. Merrill, 260 Ala. 408, 411, 71 So. 2d 44, 46 (1954) (stating that the doctrine of laches does not depend on any particular period of time, "but is a principle of good conscience dependent upon the facts of each case"). In determining whether a "reasonable time" has expired, the trial court should consider several factors, including the circumstances under which the original paternity judgment was rendered; the circumstances under which, and when, the previously adjudicated father came to doubt that he was the biological father; when he sought to obtain scientific evidence to determine paternity; when he presented the scientific evidence to the trial court or asked the trial court to order scientific testing; and the burdens imposed on the previously adjudicated father and on the child by the continued enforcement of the prior paternity adjudication or by the reopening of the judgment. See generally Rule 1(c), Ala. R. Civ. P. (stating that the Rules of Civil Procedure "shall be construed ... to secure the just ... determination of every action"); W.J., 622 So. 2d at 363 (Maddox, J., dissenting); id. at 363-64 (Houston, J., dissenting).[16]
In this case, the trial court premised its holding on a retroactive application of § 26-17A-1 and did not address M.A.B.'s Rule 60(b)(6) motion. On remand, it should consider that motion; in doing so, it should review the facts and circumstances and consider the factors set out above, in determining whether M.A.B. filed his Rule 60(b)(6) motion within a reasonable time.
In sum, we hold that the limitations period of § 26-17-6(a) does not apply to actions to establish the nonexistence of paternity and that § 26-17A-1, interpreted to apply prospectively, does not violate the separation-of-powers principle. A paternity judgment that became final before the effective date of § 26-17A-1April 26, 1994is subject to being reopened only under Rule 60(b)(6), and then only if the motion to reopen it is filed within a "reasonable time." A paternity judgment that became final on or after April 26, 1994, is subject to being reopened under Rule 60(b)(6) or under § 26-17A-1, which contains no "reasonable time" requirement. We further hold that although the trial court did not reach the issue, M.A.B. may be entitled to relief under Rule 60(b)(6). Accordingly, we reverse the judgment of the Court of Civil Appeals with instructions for that court to order further proceedings in the trial court not inconsistent with this opinion.
REVERSED AND REMANDED.
HOOPER, C.J., and HOUSTON and LYONS, JJ., concur.
MADDOX, J., concurs in Part II; dissents from Part III.A; and concurs in the result as to Part III.B.
ALMON and SHORES, JJ., concur in Parts II, III.A, and IV, and dissent from Part III.B.
KENNEDY, J., concurs in Parts II, III.A, and IV, and dissents from Part III.B.
COOK, J., concurs in Parts II, III.B, and IV, and dissents from Part III.A.
*661 MADDOX, Justice (concurring in part; concurring in the result in part; and dissenting in part).
I concur in Part II; I dissent from Part III.A.; and I concur in the result as to Part III.B. Although I agree that one adjudicated to be the father of a child should be permitted to attempt to reopen the paternity adjudication if he has scientific evidence indicating that he is not the father, I cannot agree with the main opinion's discussion of the separation of powers provision of the Alabama Constitution or with the conclusion that the Legislature was without the constitutional power to provide for the reopening of a judgment of paternity that became final before the effective date of § 26-17A-1April 26, 1994.[17] I write specifically to state why I believe the Legislature, as the policy-making branch of government, can adopt measures that address changing societal needs in the area of family law, an area of the law that determines so many rights and responsibilities growing out of the parent-child relationship.
The decision to vest in individual judges the sole discretion to determine the ultimate question of which judgments of paternity can be reopened might have been the better policy choice, but it is not the choice that the Legislature made, and, except where rights and responsibilities have become vested under a prior paternity judgment, I see absolutely no separation of powers problem. On the contrary, I can see tremendous problems that could be created if a man is forced to support and educate a child that the whole world knows is not his.
This case, unfortunately, is merely symptomatic of the myriad problems that have been caused by an increasingly prevalent immorality and the breakdown of the traditional nuclear family. The breakdown of the nuclear family has caused millions of American children to spend at least some part of their lives in an alternative family arrangement, an arrangement that too often is not an adequate substitute for a stable nuclear family. The arguments made in support of the welfare of these displaced children, many of whom are illegitimate, as is the case here,[18] are very persuasive, but the Legislature has determined that a man who can scientifically show that he is not the father of a child should be allowed to do so and thereby cut off any further parental obligations and responsibilities and any rights of inheritance.
Illegitimate births, such as the one that is the subject of this case, have caused problems throughout history. At common law, illegitimate children were considered to be nonpersons, and the law developed a presumption of legitimacy if a man was married to the mother of the child at the time of conception. As the number of illegitimate *662 births increased, however, there was a concomitant rise in the capacity of science to determine who, in fact, was the father of a child.
Because the breakdown of the nuclear family and the rise in the number of illegitimate children occurred at the same time that scientific testing was improving, several policy questions were presented. One of these questions was the appropriateness of continuing to apply the principle of law that tends to legitimate children, if possible. For several years now, this Court, the Court of Civil Appeals, the trial courts, and indeed the other branches of government, both state and federal, have increasingly been called upon to help address the questions that arise when there is a question whether a particular child is the product of a particular marriage.
For some time I have been troubled by the application of the common law presumptions of legitimacy that a majority of this Court has applied in paternity proceedings, and I have dissented in some of those cases,[19] the most recent being Ex parte W.J., 622 So. 2d 358 (Ala.1993), in which I stated that the petitioner there should not have been required to support a child that scientific tests conclusively showed was not his child. Justice Houston also dissented in that case, stating:
622 So. 2d at 364.
Although I do not know whether the Legislature, in adopting Act No. 94-633, Acts 1994, now codified as § 26-17A-1, was responding to this Court's holding in W.J., I do know that the power of the Legislature is plenary, and I believe this plenary power enables the Legislature to correct what it might perceive to be an injustice of requiring a man to support a child that he did not sire, but that was apparently the product of an adulterous relationship. The legislative branches of both the State and the Federal Government have attempted to address the problems created by the breakdown of the nuclear family, and no one should be allowed to question the rights of government to require fathers to support their children. These exercises of plenary power should not be so circumscribed that the Legislature could not adopt a statute that would allow a man to reopen a paternity judgment under certain circumstances, as the Legislature did in this case. In the remainder of this opinion I will show, after stating some of the history of the presumption of legitimacy, why I think the Legislature had the power to do what it did.
Historically, courts determined paternity based on a presumption that a child born during a marriage, provided that access to the husband at the time of conception was not impossible, was legitimate and the child was a child of the husband, whether that was true or not. This presumption was based on the policy of the law to confer legitimacy upon children whenever possible, and it was applied even in cases where the wife was guilty of infidelity during the possible period of conception. The strict rule of the common law was eventually relaxed and repudiated, or at least greatly modified, and it ultimately gave way to the modern doctrine that the presumption of paternity may be rebutted by competent and relevant evidence showing that the husband could not have been the father of the child. See Arthur v. Arthur, 262 Ala. 126, 77 So. 2d 477 (1955). Indeed, those are the facts in this case. Here, M.A.B. has shown by competent and relevant evidence that he could not have been the father of J.B.
*663 In analyzing whether the Legislature had the power to require the reopening of a paternity judgment in certain factual settings, I am guided first by the well-established principles that duly enacted statutes are presumed to be constitutional and that this Court should sustain a statute "unless it is clear beyond reasonable doubt that it is violative of the fundamental law." Alabama State Federation of Labor v. McAdory, 246 Ala. 1, 9, 18 So. 2d 810, 815 (1944). After considering § 26-17A-1 and the distinctive subject matter that statute addresses, I am not convinced beyond a reasonable doubt that the Legislature exceeded its authority when it attempted to modify Alabama domestic relations law.
In analyzing the separation of powers issue, the main opinion relies heavily on Plaut v. Spendthrift Farm, Inc., 514 U.S. 211, 115 S. Ct. 1447, 131 L. Ed. 2d 328 (1995). However, in Plaut, the rights of parties to the judgment had become vested, and the judgment at issue was not a judgment that determined future rights and responsibilities of a parent and rights of inheritance that had not become vested. The statute in question in Plaut was Congress's response to Lampf, Pleva, Lipkind, Prupis & Petigrow v. Gilbertson, 501 U.S. 350, 111 S. Ct. 2773, 115 L. Ed. 2d 321 (1991). Before the entry of the judgment in Lampf, there was not a national statute of limitations governing federal securities fraud cases; in general, the statute of limitations for such actions was borrowed from a comparable state statute of limitations. In Lampf, the United States Supreme Court established that the limitations period applicable to private actions alleging violations of § 10(b) of the Securities and Exchange Act of 1934 and Securities and Exchange Commission Rule 10b-5 was one year after the discovery of the facts constituting the violation or three years after the violation. Plaut, 514 U.S. at 214, 115 S. Ct. 1447. As a result of this decision, some private actions that would have been timely under the old statute of limitations were time-barred under the new statute of limitations. In response, Congress amended the Securities and Exchange Act of 1934 to provide that any action that was commenced on or before the date of the Lampf decision and that had been held untimely, based on Plaut, but that would have been timely under the old statute of limitations, could be reinstated by the plaintiff. The United States Supreme Court struck down the amendment as a violation of the separation of powers doctrine.
I agree with the Supreme Court's decision in Plaut, given the facts of that case, and I am firmly committed to the doctrine of separation of powers. However, I do not believe Plaut is relevant to the peculiar situation this Court must address in this case. In this case, M.A.B. was erroneously adjudicated to be the father of a child, in all probability because he was married to the child's mother and the common law presumption of legitimacy was applied. M.A.B. was required to make continuing child support payments based on that adjudication, and he could have been held in contempt of court for his failure to do so. The basic question is whether he should continue to have to support that child when it is possible to show conclusively that he is not the child's father. In my opinion, this is primarily a question of public policy, and the Alabama Legislature has provided a procedure for reopening such adjudications.
A majority of this Court concludes that the Legislature was without power to authorize one adjudicated to be the father of a child to reopen the adjudication if it was made before the effective date of the Act. I do not share that view, and I believe the majority errs in its logic. My domestic relations professor in law school often stated, "When you are dealing with domestic relations you have to get down a different set of books." My professor was right. Cases involving family law in general, and paternity adjudications in particular, are equitable in nature and most judgments based on that law are modifiable when circumstances change. Cf. Hartigan v. Hartigan, 272 Ala. 67, 128 So. 2d 725 (1961) (stating that a provision in a divorce judgment requiring periodic payments of alimony is not final in the sense that it cannot be changed, and that a court may modify provisions requiring periodic payments of alimony upon proof of a change in conditions). I realize, of course, that in Hartigan this Court exercised its equitable powers to set aside the prior adjudication; however, does that *664 mean that the Legislature is without power to do so? I think the Legislature has that power, except as to rights that have become vested, such as child support payments previously made.
I recognize the importance of a paternity adjudication and the effect such an adjudication has on the future rights of a child as to support and maintenance and as to inheritance. Because paternity adjudications affect so many rights of a parent and child, they affect the public interest, more so now than when the nuclear family was more intact. Because of that fact, the Legislature has within its plenary power the power to make the policy choices it deems necessary and proper to protect those public interests, including the power to reopen a past adjudication of paternity. Cf. Hartigan, 272 Ala. at 67, 128 So. 2d at 728 (explaining that divorce actions have a tripartite character, with the public occupying, in effect, the position of a third party).
In short, I believe that the Legislature, in adopting § 26-17A-1, recognized two things: (1) the changing circumstances that exist in today's society regarding the traditional nuclear family and (2) the advent of accurate scientific tests that can show paternity with certainty. In the context of these recognitions, the Legislature obviously balanced the interests of the child against the interest of the person adjudicated to be the father and concluded that a man should not be forced to continue to pay support for a child that he could scientifically prove was not his.
I have always personally believed that there was something wrong with requiring a man, against his will, to support a child that he did not father, especially when the child is the result of his wife's unfaithfulness.[20]
Based on the foregoing, I conclude that the Legislature did not violate the Constitution by adopting § 26-17A-1, but that it merely determined, as a matter of public policy, that one adjudicated to be the father of a child may reopen the paternity case if he can present scientific evidence indicating that he is not the father. Consequently, I believe the trial court properly reopened this paternity adjudication under § 26-17A-1, and I must respectfully disagree with the holding to the contrary.
ALMON, Justice (concurring in part and dissenting in part).
I agree that the principle of separation of powers, as set out in §§ 42 and 43 of the Alabama Constitution of 1901, prevents the retrospective application of § 26-17A-1, Ala. Code 1975, to judgments that became final before its effective date. Therefore, I concur in Part III.A. of the lead opinion. However, I would also hold that the same principle, for slightly different reasons, prevents the prospective application of that Code section to decisions rendered after its effective date. Therefore, I respectfully dissent from Part III.B. of the lead opinion, that portion of the opinion accepting § 26-17A-1 as constitutional in part.
I believe that the prospective application of § 26-17A-1 to reopen paternity adjudications without any time limitation and without any discretion in the circuit court violates the separation of powers doctrine for two reasons. One, the reopening of such determinations at long-delayed times may disturb settled expectations based on the long-accepted adjudication of paternity. We are reviewing these cases in relation to child support issues, but the adjudication of paternity would also affect other questions, such as inheritance. My second basis for concluding that the statute violates the principle of separation of powers is the directive that "the case shall be reopened." § 26-17A-1(a) (emphasis added). To the extent that this purports *665 to require a setting aside of the paternity adjudication based only on the results of DNA or other paternity tests, I think it violates the judicial decision-making function of deciding each case on its own merits. The equity conscience of the court should be involved, for example, in determining whether to disrupt perceived family ties and estate plans.
Nevertheless, I would respect the intent of the legislature in its adoption of that section by announcing a new rule of application of Rule 60(b), Ala. R. Civ. P., in challenges, such as this one, to paternity adjudications. I would hold that a Rule 60(b) challenge to a paternity judgment entered after April 26, 1994, the effective date of § 26-17A-1, should be decided under the standard of review adopted today in Part IV of the lead opinion for Rule 60(b) challenges to paternity judgments entered before that date. Under that standard, the "reasonable time" within which a person must file a Rule 60(b)(6) motion depends upon all the circumstances, with due regard for the legislative attempt to provide for review more broadly than was allowed in cases decided by this Court before the enactment of § 26-17A-1, such as Ex parte W. J., 622 So. 2d 358 (Ala.1993), and Ex parte State ex rel. G.M. F., 623 So. 2d 722 (Ala.1993). However, I would hold this construction of the "reasonable time" requirement to apply to paternity judgments that became or become final on or after April 26, 1994, as well as to those that became final before that date.
In Ex parte W.J., this Court held that "W. J.'s unreasonable delay bars his relief in this case." 622 So. 2d at 363. This holding was based on the fact that at the time of the 1981 paternity action against him W.J. had some "reason to doubt," 622 So. 2d at 362, that he was the father of the child, but did not bring his action seeking relief from that adjudication until 1990. The 1990 challenge to the paternity adjudication was based on DNA tests that W.J. obtained on himself and the child in 1989; one could infer that he had the testing done because the court had doubled the amount of child support he was required to pay. Thus, under a generous reading of the "reasonable time" requirement of Rule 60(b)(6), the circuit court reasonably could have found that W.J. first had an evidentiary basis for challenging his alleged paternity in 1989 and that he filed his Rule 60(b) motion within a reasonable time thereafter. I dissented in Ex parte W.J., but I followed the rule of Ex parte W.J. in writing the majority opinion in Ex parte State ex rel. G.M.F., supra.
In light of the legislature's indication that it disapproves of the strict application of the "reasonable time" limitation of Rule 60(b)(6), I would apply a more expansive reading of that limitation to cases such as this one. I would apply the standard discussed in Part IV of the lead opinion to paternity challenges henceforth. Thus, I concur in Part IV of the lead opinion.
I also concur in Part II of the lead opinion.
SHORES, J., concurs.
KENNEDY, Justice (concurring in part and dissenting in part).
I concur in Part II, Part III.A., and Part IV of the main opinion. I dissent as to Part III.B. I agree that § 26-17A-1, Ala.Code 1975, when applied retroactively, violates the doctrine of separation of powers. However, I believe that prospective application of the statute also violates the separation of powers doctrine. Additionally, I believe that § 26-17A-1 violates the equal protection guaranties of the United States Constitution and the Alabama Constitution.
As early as 1869, this Court held that the legislature could not pass an act requiring courts to reopen cases and grant new trials, because to do so would violate the separation of powers doctrine. Sanders v. Cabaniss, 43 Ala. 173 (1869). In Sanders, the post-Civil War legislature passed a bill requiring courts, if petitioned, to reopen judgments that had been rendered after May 25, 1865, if the actions in which the judgments were entered had originated before that date.
43 Ala. at 186.
In 1949, the Alabama legislature enacted a law requiring circuit courts to grant new trials under certain circumstances. Codified at Title 15, § 305, Ala.Code of 1940, that law provided that if the prosecutor in a criminal case "makes any comment concerning the defendant's failure to testify, [then] a new trial must be granted on motion filed within thirty days from entry of the judgment." See Broadway v. State, 257 Ala. 414, 415, 60 So. 2d 701 (1952).
In Broadway, this Court recognized that the courts derive their powerincluding the authority of the circuit courts to grant new trialsfrom the constitution:
257 Ala. at 417-18, 60 So. 2d at 704.
The Broadway Court stated that, except insofar as the constitution authorizes it to do so, "`the legislature cannot ... diminish the essentials of the jurisdiction, functions, or judicial powers so conferred on [the courts], nor abrogate or abridge their inherent powers or functions. In other words, the legislature cannot take from courts power which it does not give.'" 257 Ala. at 418, 60 So. 2d at 704, quoting 21 C.J.S. Courts, § 122 (emphasis added in Broadway).
Broadway, 257 Ala. at 418, 60 So. 2d at 704-05.
As Judge Crawley noted in his well-reasoned dissent in K.M. v. G.H., 678 So. 2d 1084 (Ala.Civ.App.1995), other state courts have struck down similar attempts by legislatures to reopen final judgments. In Ratcliffe v. Anderson, 72 Va. (31 Gratt.) 105 (1878), the Virginia Supreme Court of Appeals struck down a post-Civil War statute authorizing the reopening of judgments rendered after 1866. In Ratcliffe, a debtor wanted to reopen a case after a final judgment had been rendered, in order to show that he had contracted with his creditor using Confederate currency as the standard of value, and to have his debt reduced from its face amount to its post-War depreciated value. "[T]he legislature interfered to provide a new remedy for the benefit of a class of persons to obtain a rehearing in suits in which judgments and decrees had been made, and became final against them." 72 Va. (31 Gratt.) at 111.
In Lawson v. Jeffries, 47 Miss. 686, 12 Am. Rep. 342 (1873), the Mississippi Supreme Court held that legislation granting new trials in all cases where the judgments were *667 rendered after 1861 violated the separation of powers provisions in the state and federal Constitutions. As the Mississippi Supreme Court aptly noted:
47 Miss. at 704, 12 Am. Rep. at 351.
The Mississippi court also correctly stated:
47 Miss. at 704, 12 Am.Rep. at 353.
Long before the "new trial" cases arose following the Civil War, the New Hampshire legislature had attempted to order a court to grant a new trial to the losing party in a probate proceeding. In Merrill v. Sherburne, 1 N.H. 199, 202, 8 Am.Dec. 52, 55 (1818), the New Hampshire Supreme Court noted that the act "does not empower the court in their discretion to grant or refuse a new trial; but directs that `the cause shall be heard' again; and thus amounts to an absolute reversal of the judgment...." In discussing the separation of powers doctrine, the court stated:
1 N.H. at 210, 8 Am.Dec. at 61-62 (emphasis added).
As recently as 1984, the Massachusetts Supreme Judicial Court struck down a statute that would have restored a dismissed case to the active docket of a trial court. The court wrote:
Spinelli v. Commonwealth, 393 Mass. 240, 242, 470 N.E.2d 795, 796 (1984).
In 1995, the United States Supreme Court in Plaut v. Spendthrift Farm, Inc., 514 U.S. 211, 115 S. Ct. 1447, 131 L. Ed. 2d 328 (1995), held that by requiring federal courts to reopen final judgments entered pursuant to § 10(b) of the Securities Exchange Act, Congress had violated the fundamental principle of separation of powers. Plaut involved Congress's reaction to the Supreme Court's earlier decision in Lampf, Pleva, Lipkind, Prupis & Petigrow v. Gilbertson, 501 U.S. 350, 111 S. Ct. 2773, 115 L. Ed. 2d 321 (1991), in which the Court had adopted a uniform national limitations period for civil actions brought under § 10(b). After Lampf was decided, a number of § 10(b) actions were dismissed as untimely; Plaut's case was among them. Plaut did not appeal the dismissal. Some months later, Congress enacted a statute that rejected the holding in Lampf for cases filed before Lampf was decided; that statute effectively required a court to reinstate a *668 § 10(b) action on the motion of the plaintiff if the action would have been considered timely under the law that was applicable before Lampf was decided.
The Supreme Court held that the Article III grants the federal courts "the power, not merely to rule on cases, but to decide them, subject to review only by superior courts in the Article III hierarchy." Plaut, 514 U.S. at 218-19, 115 S. Ct. 1447. The Supreme Court concluded that "[b]y retroactively commanding the federal courts to reopen final judgments, Congress has violated this fundamental principle." 514 U.S. at 219, 115 S. Ct. 1447.
The separation of powers doctrine is "violated when an individual final judgment is legislatively rescinded for even the very best of reasons, such as the legislature's genuine conviction (supported by all the law professors in the land) that the judgment was wrong; and it is violated 40 times over when 40 final judgments are legislatively dissolved." Plaut, 514 U.S. at 228, 115 S. Ct. 1447.
The Supreme Court in Plaut addressed the argument that the statute was similar to Rule 60(b), F.R.Civ.P., which authorizes the trial courts to relieve parties from final judgments for grounds such as excusable neglect, newly discovered evidence, fraud, or any other reason justifying relief. Rule 60(b), F.R.Civ.P. (which is virtually identical to Rule 60(b), Ala.R.Civ.P.), calls for the exercise of the trial court's discretion. The Supreme Court said of that Rule:
514 U.S. at 233-34, 115 S. Ct. 1447.
The legislature's mandate in § 26-17A-1 that a trial court reopen a final judgment will, whether applied retroactively or applied prospectively, undermine the checks and balances built into our system of government. The Alabama Constitution gives the judicial branch the power to interpret the law. That power necessarily includes the power to render dispositive judgments. It is understandable that the legislature would want to undo the injustice of forcing a man to pay child support when scientific proof excludes his being the biological father of that child. However, the legislature was without the power to do so. The power to undo such a judgment remains with the trial court, under Rule 60(b), Ala.R.Civ.P.
Section 26-17A-1 also violates the equal protection doctrine of the United States Constitution and the Alabama Constitution because it allows only one group of people affected by paternity determinations to reopen a case. Under the statute, neither mothers nor children could undo a paternity adjudication.
Section 26-17A-1 states: "Upon petition of the defendant ..., where the defendant has been declared the legal father, the case shall be reopened if there is scientific evidence presented by the defendant that he is not the father." A court construing a statute must give the words used in the statute "their plain, natural, ordinary, and commonly understood meaning." Ex parte New England Mutual Life Ins. Co., 663 So. 2d 952, 955 (Ala.1995).
Ex parte Presse, 554 So. 2d 406, 411 (Ala. 1989). Clearly, only a father can reopen a paternity judgment under this statute, given *669 unambiguous language in the statute. If the legislature had intended to allow mothers and children to reopen final adjudications of paternity, it would have so stated in the statute.
The equal protection doctrine requires that all "similarly situated" persons be treated alike. For purposes of this case, other similarly situated persons would include those persons who were parties to a prior paternity adjudication that is now challenged. Does the legislature's clear exclusion of mothers and children affected by paternity judgments from the group allowed to reopen judgments violate the Equal Protection Clause of the Fourteenth Amendment or the equal protection guaranty of Alabama law?
The Fourteenth Amendment to the United States Constitution provides that "No state shall ... deny to any person within its jurisdiction the equal protection of the laws." In considering whether a state statute violates the Equal Protection Clause, we apply different levels of scrutiny to different types of classifications. At the lowest level, a statutory classification must be rationally related to a legitimate government interest. At the highest level, classifications based on race or national origin, or affecting fundamental rights, are given strict scrutiny. Between these lies a level of intermediate scrutiny, which has been applied to discriminatory classifications based on gender or illegitimacy. Clark v. Jeter, 486 U.S. 456, 108 S. Ct. 1910, 100 L. Ed. 2d 465 (1988).
To withstand intermediate scrutiny, a statutory classification must be substantially related to an important governmental objective. Does the distinction made in § 26-17A-1 bear a substantial relationship to some important state interest?
Section 26-17A-1 authorizes a defendant in a paternity action to reopen an adjudication of paternity if he has scientific proof indicating that he is not the biological father of the child. The purpose of the statute, to remedy the injustice of erroneous paternity adjudications, is an important government interest. However, the classifications established by the legislature are not "substantially related" to that purpose. By allowing only defendant fathers to refute an adjudication of paternity, the goal of remedying erroneous paternity adjudications is achieved for only some of those persons who are similarly situated. Therefore, the classification violates the equal protection guaranties of the United States Constitution and the laws of Alabama.
In Caban v. Mohammed, 441 U.S. 380, 99 S. Ct. 1760, 60 L. Ed. 2d 297 (1979), the United States Supreme Court dealt with a New York Domestic Relations Law provision that made a distinction between unwed fathers and unwed mothers; that provision permitted an unwed mother, but not an unwed father, to block the adoption of their child simply by withholding consent. The Supreme Court held that that distinction was substantially related to the state's interest in providing adoptive homes for its illegitimate children. The distinction "`must be reasonable, not arbitrary, and must rest upon some ground of difference having a fair and substantial relation to the object of the legislation, so that all persons similarly circumstanced shall be treated alike.'" Caban, 441 U.S. at 391, 99 S. Ct. 1760, quoting Royster Guano Co. v. Virginia, 253 U.S. 412, 415, 40 S. Ct. 560, 64 L. Ed. 989 (1920), and Reed v. Reed, 404 U.S. 71, 76, 92 S. Ct. 251, 30 L. Ed. 2d 225 (1971).
This Court has determined that §§ 1, 6, and 22 of the Declaration of Rights of the Alabama Constitution combine to guarantee equal protection under the laws of Alabama. Moore v. Mobile Infirmary Ass'n, 592 So. 2d 156 (Ala.1991). I conclude that the statutory classification created by § 26-17A-1 is not substantially related to the object of the legislation, and therefore violates both the United States Constitution and the laws of Alabama.
COOK, Justice (concurring in part and dissenting in part).
I concur with those portions of the lead opinion holding (1) that the statute of limitations does not bar M.A.B.'s petition to reopen the question of his paternity; (2) that Ala. Code 1975, § 26-17A-1, does not, when applied prospectively, violate the principle of separation of powers; and (3) that the "reasonable time" element of Ala. R. Civ. P. *670 60(b)(6) is, in this class of cases, to be construed much more liberally than it has been in the past. I dissent, however, from that portion of the opinion holding that § 26-17A-1 violates the separation-of-powers principle if applied retroactively; therefore, I also dissent from the judgment of reversal.
Relying primarily on, and quoting, Judge Crawley's dissent in K.M. v. G.H., 678 So. 2d 1084, 1097 (Ala.Civ.App.1995), Jenkins, the guardian ad litem for the minor child, contends that "`the legislature may not, without violating the separation of powers doctrine, order a court to reopen a final judgment and grant a new trial.'" Brief in Support of Petition of Guardian ad Litem for Writ of Certiorari, at 13. Cases cited in support of this proposition are: Sanders v. Cabaniss, 43 Ala. 173 (1869); Lawson v. Jeffries, 47 Miss. 686 (1873); Ratcliffe v. Anderson, 72 Va. (31 Gratt.) 105 (1878); and Broadway v. State, 257 Ala. 414, 60 So. 2d 701 (1952). Because, he insists, § 26-17A-1 has this effect, it violates the separation-of-powers principle. I find these cases to be inapposite.
Sanders v. Cabaniss involved the effect of Act No. 59, §§ 5-6, 1868 Ala. Acts 415, which, significantly, was entitled: "An act to delare void certain judgments, and to grant new trials in certain cases therein mentioned, and to repeal sections 2876 and 2877, of the [Ala.Code 1867]." (Emphasis added.) Section 5 provided:
Section 6 provided: "That on all new trials of causes originating under the provisions of this act, the defendant shall be entitled to all the rights he would have had if no suit had been previously commenced." (Emphasis added.)
Pursuant to these provisions of the statute, and upon the motion of William H. Sanders and Virginia H. Markham, a court of chancery, on January 1, 1869, reinstated an action in which a decree had been entered on August 11, 1868. 43 Ala. at 174-75. That decree had established a lien, which was to be satisfied by Sanders and Markham, against "certain lands." Id. at 174. The broad, substantive issue presented to this Court was whether the above-quoted provisions of the statute violated the principle of separation of powers. The Court held that they did.
In so holding, it explained that the "lines of separation" between powers allocated to the judicial and legislative departments respectively "some times approach so near to each other, that, in some cases, it requires great precision to determine where the true line of separation is." Id. at 180. The Court then set forth some general principles applicable in defining the "line of separation." It explained, for example: "`[T]o declare what the law is, or has been, is a judicial power; to declare what the law shall be, is legislative....'" Id. at 180 (emphasis added). "It has been said, that which distinguishes a judicial from a legislative act is," the Court continued, "that the one is a determination what is the existing law in relation to some particular thing already done or happened, while the other is a predetermination of what the law shall be, for the regulation and government of all future cases falling under its provisions." 43 Ala. at 181.
The Court in Sanders also relied in part on Alabama Life Insurance & Trust Co. v. Boykin, 38 Ala. 510 (1863), explaining:
*671 43 Ala. at 187 (emphasis added). The Court concluded that Act No. 59, § 5, violated the separation-of-powers principle in that it rendered the chancellor "the mere instrument of the legislature to register their will; nothing more." 43 Ala. at 188.
Similarly, in the second case cited by Jenkins, the Virginia Court of Appeals held that the legislature could not constitutionally grant the judiciary power to void and set aside a final judgment for the purpose of depreciating the amount of the judgment to its value in Confederate currency. Ratcliffe v. Anderson, 72 Va. (31 Gratt.) 105 (1878). The court explained:
72 Va. (31 Gratt.) at 110 (emphasis added).
In the third case cited by Jenkins, the Supreme Court of Mississippi considered the constitutionality of an act passed by the Mississippi legislature purporting to abrogate and annul all judgments entered between January 9, 1861, and April 29, 1868, upon an affidavit by the unsuccessful litigant stating that the affiant had not been represented by counsel in the prior adjudication. Lawson v. Jeffries, 47 Miss. 686 (1873). The court stated:
Id. at 701. The court concluded that the act "was a judicial act [as opposed to legislative], and, therefore, unauthorized." Id. at 707.
Finally, Jenkins cites Broadway v. State, 257 Ala. 414, 60 So. 2d 701 (1952), in which this Court held that the legislature could not require the judiciary summarily to grant a criminal defendant a new trial merely upon a showing that the "prosecuting attorney [made some] comment concerning the defendant's failure to testify." Id. at 415, 60 So. 2d at 702. It reasoned that a legislative act having that effect would "deprive the circuit court of its constitutional power to function in a judicial way in that respect." Id. at 418, 60 So. 2d at 704.
At first glance, the 19th century cases cited by Jenkins appear to support his argument. Closer examination, however, reveals that they resemble this case only superficially. Indeed, more to the point are more recent United States Supreme Court decisions, which I will now discuss, considering their applications to the peculiar facts of this case, and contrasting this case with those cases cited by Jenkins.[21]
United States v. Sioux Nation of Indians, 448 U.S. 371, 100 S. Ct. 2716, 65 L. Ed. 2d 844 (1980), is particularly analogous to this case. There, the Supreme Court considered whether Congress could, without violating the principle of separation of powers, authorize the *672 United States Court of Claims to reopen and relitigate a claim against the United States barred by the doctrine of res judicata, "to take new evidence in the case, and to conduct its review on the merits de novo." Id. at 389, 100 S. Ct. 2716. It answered that question in the affirmative.
That claim was asserted by the Sioux Nation against the United States, seeking compensation, with interest accruing from 1877,[22] for the "taking" of the Black Hills of South Dakota without just compensation. It was first adjudicated in 1942 and a judgment rendered in favor of the United States. Id. at 384, 100 S. Ct. 2716. See Sioux Tribe of Indians v. United States, 97 Ct.Cl. 613 (1942), cert. denied, 318 U.S. 789, 63 S. Ct. 992, 87 L. Ed. 1155 (1943). At that time, the Court of Claims held that it was not legally authorized "to question whether the compensation afforded the Sioux by Congress in 1877 was an adequate price for the Black Hills." 448 U.S. at 384, 100 S. Ct. 2716.
Subsequently, Congress enacted legislation creating an "Indian Claims Commission" (the "Commission") to inquire into "tribal grievances." Id. See Indian Claims Commission Act, 25 U.S.C. § 70 et seq. The Sioux Nation reasserted its claim with the Commission, which concluded that the United States was liable to pay "just compensation for the taking of the Black Hills." 448 U.S. at 386, 100 S. Ct. 2716. The United States appealed to the Court of Claims, which, in 1975, "held that the merits of the Sioux' taking claim had been reached in 1942, and ... was [in 1975] barred by res judicata." Id. at 388, 100 S. Ct. 2716 (emphasis added). See United States v. Sioux Nation, 207 Ct.Cl. 234, 518 F.2d 1298, cert. denied, 423 U.S. 1016, 96 S. Ct. 449, 46 L. Ed. 2d 387 (1975).
Three years later, Congress passed Pub.L. 95-243, 92 Stat. 153, amending 25 U.S.C. § 70s(b); that new law provided for de novo review in the Court of Claims "of the merits" of the taking claim, "without regard to the defenses of res judicata and collateral estoppel." 448 U.S. at 389, 100 S. Ct. 2716. Pursuant to that statute, the Court of Claims reexamined the merits of the Sioux Nation's claims. Id. It held that the "1877 Act [had] effected a taking of the Black Hills," for which the United States was required to pay just compensation, and it awarded the Sioux Nation a sum representing the 1877 fair market value of the Black Hills, plus annual interest "dating from 1877." Id. at 389, 390, 100 S. Ct. 2716.
On the petition of the United States for certiorari review, the Supreme Court considered, among other things, whether Congress violated the separation-of-powers doctrine in providing for the abrogation of the Court of Claims judgments of 1942 and 1975, and the reconsideration of the merits of the Sioux Nation's claims. Id. at 391, 100 S. Ct. 2716. The Court concluded that it had not. Id. at 397, 100 S. Ct. 2716. It explained that "Congress has the power to waive the res judicata effect of a prior judgment entered in the Government's favor on a claim against the United States." Id. Sioux Nation's rationale applies with equal force to the situation presented in this case. This is so because the Alabama Legislature, no less than Congress, possesses the power to enact legislation waiving the res judicata effect of a judgment entered in its favor on a claim against the State. A paternity adjudication in a case where the State has provided assistance through the "Aid to Families with Dependent Children" program ("AFDC"), or in which the action was brought in the name of the State, pursuant to Ala.Code 1975, § 26-17-7,[23] is a judgment in favor of the State, and the readjudication of paternity pursuant *673 to § 26-17A-1 is a claim "against," or adverse to, the State.
These conclusions follow from the role exercised by the State in providing AFDC, pursuant to the Child Support Programs, Ala.Code 1975, §§ 38-10-1 to -53, and in bringing actions pursuant to § 26-17-1, which is the statutory directive providing that paternity actions be brought in the name of the State of Alabama. For example, the Child Support Programs authorize the Department of Human Services ("DHR") to "operate [such] child support programs [as] locating absent parents, establishing paternity, establishing or modifying support orders, enforcing support obligations and related matters." Section 38-10-3(a). "As a condition of eligibility for aid, each recipient of aid to families with dependent children shall be deemed, by accepting aid, to have made an assignment to the department of the right to any support owed up to the amount of aid paid by the department...." Section 38-10-4. DHR is then "subrogated to the right of such child or recipients ... to collect and receive all child support payments and to initiate any support action existing now or in the future under the laws of Alabama." Id. Having disbursed public funds for AFDC, and, consequently, having acquired the right of subrogation, the State becomes the real party in interest in litigation affecting its right of recovery. Ex parte W.J., 622 So. 2d 358, 363 (Ala.1993) (Houston, J., dissenting); State ex rel. Robertson v. Robertson, 675 So. 2d 422, 424-25 (Ala.Civ.App.1995).
Thus, a paternity adjudication in a case where the State has provided AFDC is a judgment in favor of the State. Conversely, an action pursuant to § 26-17A-1 to set aside a prior adjudication of paternity is a claim "against," or adverse to, the State, because, if the prior adjudication is set aside, the State loses its right to recoup AFDC payments it has made from the party formerly adjudicated liable for child support.
The real effect, therefore, of § 26-17A-1 is to deny the State the benefit of a res judicata defense in those cases in which the State has acquired an interest. This the legislature may do without violating the doctrine of separation of powers. Sioux Nation, supra.
In that respect, § 26-17A-1 differs remarkably from the statutes invalidated in the cases on which Jenkins relies. Very simply, none of the statutes under review in those cases involved claims against the State directly implicating the state treasury. But there are other dispositive distinctions that will become more apparent after a brief discussion of Plaut v. Spendthrift Farm, Inc., 514 U.S. 211, 115 S. Ct. 1447, 131 L. Ed. 2d 328 (1995).
The dispute in Plaut involved the power of Congress retroactively to reopenin private, civil actions based on the Securities Exchange Act of 1934, § 10(b), codified as amended, 15 U.S.C. § 78j(b), and Securities Exchange Commission Rule 10b-5final judgments holding that the claims were barred by the limitations period applicable when the judgments became final. The legislative action reviewed in Plaut was Congress's response to Lampf, Pleva, Lipkind, Prupis & Petigrow v. Gilbertson, 501 U.S. 350, 111 S. Ct. 2773, 115 L. Ed. 2d 321 (1991), in which the Supreme Court decided, for the first time, that the limitations period applicable to private actions alleging violations of § 10(b) and Rule 10b-5 was "one year after the discovery of the facts constituting the violation and ... three years after such violation." 514 U.S. at 213, 115 S. Ct. 1447. The lower federal courts had, until Gilbertson was decided, applied "applicable state limitations period[s]." 514 U.S. at 216, 115 S. Ct. 1447.
In response to Gilbertson, Congress amended the Securities Exchange Act of 1934 by a provision codified at 15 U.S.C. § 78aa-1. The amendment provided that any such action that was "commenced on or before" the Gilbertson decision; that was adjudicated on the basis of the new rule to be "time barred," but would have been "timely" under the former rule; could "be reinstated on motion by the plaintiff." See 514 U.S. at 214-15, 115 S. Ct. 1447. The Court held that § 78aa-1, "to the extent ... it require[d] federal courts to reopen final judgments in private civil actions under § 10(b)," violated the principle of separation of powers. 514 U.S. at 213, 115 S. Ct. 1447.
*674 In the Court's view, the validity of § 78aa-1 turned on whether it operated prospectively or retroactively. According to the Court, "Congress could undoubtedly enact prospective legislation permitting, or indeed requiring, [a court] to make equitable exceptions to an otherwise applicable rule of finality, just as district courts do pursuant to Rule 60(b)," 514 U.S. at 237, 115 S. Ct. 1447 (emphasis in original). More specifically, if the law applicable to the case at the time the judgment is entered "says that the judgment may be reopened for certain reasons, that limitation is built into the judgment itself, and its finality is so conditioned." 514 U.S. at 234, 115 S. Ct. 1447.
What Congress could not do, the Court explained, was "`reverse a determination once made, in a particular case.'" 514 U.S. at 225, 115 S. Ct. 1447. "When retroactive legislation requires its own application in a case already finally adjudicated," the Court continued, "it does no more and no less than `reverse a determination once made, in a particular case.'" Id. at 225, 115 S. Ct. 1447 (emphasis added). "Congress may not declare by retroactive legislation that the law applicable to that very case was something other than what the courts said it was." 514 U.S. at 227, 115 S. Ct. 1447 (emphasis in original). The Court concluded that § 78aa-1 was legislation of the latter type, and, therefore, unconstitutional. 514 U.S. at 227-28, 115 S. Ct. 1447.
The Court's discussion of § 78aa-1 illustrates a fundamental distinction between that statute and § 26-17A-1, the statute involved in this case. In fact, the legislation involved in Sanders v. Cabaniss, 43 Ala. 173 (1869); Lawson v. Jeffries, 47 Miss. 686 (1873); and Ratcliffe v. Anderson, 72 Va. (31 Gratt.) 105 (1878), differed in no substantive respect from that in Plaut. The legislation, which, in all four cases, was fully retroactive, aimed to allow the losing party to retry the case with the possibility of getting a judgment in his favor. In other words, every case involved the destruction of rights that had become fully vested by the prior adjudication.
In Sanders, for example, the statute provided that "on all new trials of causes originating under the provisions of [the] act, the defendant [should] be entitled to all the rights he would have had if no suit had been previously commenced." Act No. 59, § 6, 1868 Ala. Acts 415 (emphasis added). In this way, Act No. 59 divested Cabaniss of the right to enforce the lien to which he was entitled pursuant to the prior adjudication. Thus, Act No. 59 not only destroyed rights that had vested in plaintiffs, but subjected plaintiffs to the possibility of liability to the defendants in subsequent actions. See also Alabama Life Insurance & Trust Co. v. Boykin, 38 Ala. 510, 513 (1863) (separation-of-powers doctrine prohibits legislation that, in voiding a judgment, "divest[s] a title out of one, and vest[s] it in another").
This feature of Act No. 59 was characteristic of the legislation involved in the other three cases. See Plaut (under § 78aa-1a, a Rule 10b-5 action defendant, whose nonliability had been adjudicated, faced anew the prospect of liability to the plaintiff); Lawson, 47 Miss. at 701 (a judgment "becomes a vested right, by force of the constitution and the existing laws; and a statute designed to retroact on such a case ... is unconstitutional and void"); Ratcliffe, 72 Va. (31 Gratt.) at 110 ("[t]he rights of Anderson and those claiming under him had become fixed and vested; and any attempt on the part of the legislature to impair these vested rights was an invasion of judicial authority, and must be treated as unconstitutional and void").
By contrast, § 26-17A-1 disturbs no vested right. This is so, partly because of the peculiar nature of the subject matter it concerns, and partly because of § 26-17A-2, which narrowly restricts the statute's operation and effect. As to the scope of its operation and effect, § 26-17A-2 provides: "In any decree setting aside an order of paternity pursuant to this chapter, there shall be no... reimbursement or recoupment of money or damages against the mother, the State, or any employee or agent of the State." (Emphasis added.) Thus, § 26-17A-2 expressly prohibits a paternity defendant from recovery of any sort, including past payments of child support. In doing so, it focuses exclusively on the duty to pay child support, rendering the operation and effect of § 26-17A-1 prospective only. In other words, the only *675 relief afforded a party seeking to set aside a prior paternity adjudication is purely prospective prospective from the date of the second judgment. In this way, § 26-17A-1 differs fundamentally from the retrospective statutes invalidated in Plaut, Sanders, Lawson, and Ratcliffe.
Similarly, the peculiar nature of the subject matter upon which the statute operates brings it squarely within the class of legislation Plaut excepted from the constitutional prohibition. To reiterate, Plaut stated that "Congress could undoubtedly enact prospective legislation permitting, or indeed requiring, [a court] to make equitable exceptions," 514 U.S. at 237, 115 S. Ct. 1447 (emphasis in original), and that if the law applicable to the case at the time the judgment is entered "says that the judgment may be reopened for certain reasons, that limitation is built into the judgment itself, and its finality is so conditioned." 514 U.S. at 234, 115 S. Ct. 1447.
These principles have particular application to § 26-17A-1, because judgments ordering the payment of child support are always modifiable upon a showing of changed circumstances. Ala. R. Jud. Admin. 32(A)(3); Hall v. Hall, 280 Ala. 275, 192 So. 2d 727 (1966); Whitt v. Whitt, 276 Ala. 685, 166 So. 2d 413 (1964); Jones v. Jones, 682 So. 2d 1387 (Ala.Civ.App.1996); Williams v. Williams, 601 So. 2d 1023 (Ala.Civ.App. 1992); Lee v. Lee, 518 So. 2d 137 (Ala.Civ. App.1987). Child support payments become "final judgments" only upon accrual. Ex parte State ex rel. Lamon, 702 So. 2d 449, 450 (Ala.1997). Corollarily, "judgments as to child support are never res judicata." Tucker v. Tucker, 681 So. 2d 592, 594 (Ala.Civ.App. 1996); Thistlethwaite v. Thistlethwaite, 590 So. 2d 317 (Ala.Civ.App.1991). Thus, no party has a vested right to unaccrued child support payments. Based on these principles, I conclude that § 26-17A-1, which affects only such payments as were unaccrued as of the time the statute was enacted, disturbs no vested right.
Also significant is the fact that each support payment becomes a "final judgment" upon accrual. Ex parte State ex rel. Lamon, supra. Section 26-17A-1 attached, therefore, to the first such "judgment" that accrued after passage of the statute, and to every such "judgment" as it accrued thereafter. In other words, § 26-17A-1 became the law applicable to the case, governing the defendant's duty to pay child support on the basis of every payment that accrued after passage of the statute. In that way, § 26-17A-1, which "says that the judgment may be reopened for certain reasons," was "built into the judgment itself, and its finality [became] so conditioned." 514 U.S. at 234, 115 S. Ct. 1447. This, the legislature may do.
Broadway v. State, 257 Ala. 414, 60 So. 2d 701 (1952), the fourth case cited by Jenkins, differs from the other three in that Broadway did not involve retroactivity. However, Broadway is distinguishable from this case in other respects. In Broadway, a criminal defendant was granted a new trial based on a single comment made by the solicitor during the trial, namely: "`[Defendant's counsel] criticizes our witness in this case, but [defendant's counsel] has not given us any witness to criticize.'" Id. at 415, 60 So. 2d at 702. The defendant did not object or, in any way, direct the trial court's attention to the remark until it was made the basis of a motion for a new trial, pursuant to Act No. 124, 1949 Ala. Acts 150, which, as I have stated previously in this opinion, provided: "If the solicitor or other prosecuting attorney makes any comment concerning the defendant's failure to testify, a new trial must be granted...." The statute applied to every "criminal proceeding[]" conducted in Alabama. Id.
This Court stated that a legislative act having that effect would "deprive the circuit court of its constitutional power to function in a judicial way in that respect." 257 Ala. at 418, 60 So. 2d at 704. Of the statute, the Court observed:
257 Ala. at 415-16, 60 So. 2d at 702 (emphasis added).
Obviously, because of its very breadth and its application in every "criminal proceeding," this statute would have played havoc with the judiciary. Orderly judicial process in all criminal proceedings would have become an anachronism. It is easily seen that the statute represented an extreme example of such legislative intrusion as is prohibited by the separation of powers.
Section 26-17A-1 is, by contrast, singularly un intrusive. It is narrowly drafted and applies in a very narrow class of cases. Moreover, when it does apply in a particular case, it does nothing to interfere with the orderly judicial process in the case. Unlike the statute in Broadway, § 26-17A-1 does nothing to impugn the effect or operation of statements or evidence presented in the prior adjudication. In other words, it leaves the trial court free to function judicially in the prior, as well as in the subsequent, paternity adjudication. For these reasons, § 26-17A-1 does not violate the principle of separation of powers.
Finally, Jenkins contends that § 26-17A-1 violates public policy. Specifically, he states: "Our state's public policy has heretofore prohibited parents from abandoning their parental responsibilities once voluntarily assumed." Brief in Support of Petition for Writ of Certiorari, at 17. "Section 26-17A-1 is against the policy of the state," he adds, "if no timeliness requirement is [read into] to the statute." Id. at 19 (emphasis added).
These contentions essentially mirror the public-policy challenges to § 26-17A-1 that were addressed and rejected by the Court of Civil Appeals in K.M. v. G.H., 678 So. 2d 1084 (Ala.Civ.App.1995). That court in K.M. reversed a judgment of the trial court that had held that § 26-17A-1 "violates the public policy favoring the legitimacy of children and the right to rely on finality of judgments." 678 So. 2d at 1086. Because the Court of Civil Appeals' discussion of the public policy argument is particularly succinct and applicable to this case, I include substantial portions of that discussion:
678 So. 2d at 1087 (emphasis added).
As the Court of Civil Appeals correctly observes, it is quintessentially the prerogative of the legislature to declare and define public policy. Rogers v. City of Mobile, 277 Ala. 261, 281, 169 So. 2d 282, 302 (1964) ("Except as inhibited by specific constitutional provisions, the Legislature has the power to determine and declare the public policy of the state ...."); see Giuliani v. Guiler, 951 S.W.2d 318, 321 (Ky.1997) ("It is beyond challenge that public policy is determined by the constitution and the legislature through the enactment of statutes."); Michaels v. Nemethvargo, 82 Md.App. 294, 309, 571 A.2d 850, 857 (1990) ("the judiciary has generally declared that it is the province of the Legislature to determine the public policy of the State"). To the extent, therefore, that the statute is constitutionaland I would hold that it isthe legislature has the right to declare the public policy of the State on this question.
These disclaimers notwithstanding, I point out that the policy implemented by § 26-17A-1 has much to commend it in relation to the rules the judiciary had formulated based on its conception of former policy. In at least one class of cases, the former policy, as it was understood and applied by the courts of Alabama, worked results that were manifestly inconsistent and fundamentally unfair. That was so when the policy combined with "`[p]ater est quem nuptiae demonstratthe presumption that the husband of the mother of a child born during marriage is the father of that child.'"[24]Ex parte Presse, 554 So. 2d 406, 413 (Ala.1989). The presumption "`is often said to be one of the strongest presumptions known to the law.'" Id. In Alabama, it was not "conclusive," but could be rebutted "by proof of impotency on the husband's part, or by want of access to his wife during the time when pregnancy might have occurred, and other conditions in which it was impossible that the husband could have been the father of the child of his wife [born] during the marriage." Adams v. State, 428 So. 2d 117, 120 (Ala.Civ.App.1983). See Jackson v. Jackson, 259 Ala. 267, 66 So. 2d 745 (1953). The anomalies resulting from the combination of pater est quem nuptiae demonstrat with former, public-policy notions are illustrated by the following hypothetical.
Assume that Mr. and Mrs. A were married on January 1, 1980. Baby A1 was born on January 1, 1981, Baby A2 on January 1, 1983, and Baby A3 on January 1, 1985. Mr. and Mrs. A obtained a final judgment of divorce on January 1, 1987. Mr. A was ordered to make periodic payments for the support of the children.
The marital presumption applies to all three children. But, assume that, in fact, Babies A1 And A3 are not the children of Mr. A. Assume not only that this fact was unknown to Mr. A, but, also, that he had no information at the time of the divorce that would have put him on notice of that fact. Assume further that in 1997, Mr. A discovered, for the first time, facts that caused him to question Mrs. A's fidelity and that he promptly petitioned the court, pursuant to Rule 60(b), to reopen and reexamine the question of the paternity of the children.
If Mr. A argues to the trial court that he, like all the world, did, and should have been able to, rely on the marital presumption, namely, that he was the father of the children born to Mrs. A during the marriage, his argument will be rejected summarily. That is so, because cases decided before the adoption of § 26-17A-1 that would have barred his petition as untimely are legion. He will learn that he should have challenged paternity at the time of the divorce. Mr. A will *678 learn, in other words, that all the world was entitled to rely on this presumption, except the husband of the wife, whose children were born during the marriage.
In practice, therefore, a husbandunlike all otherswas deemed to have relied on the marital presumption at his peril. In order to avoid the untimeliness bar of Rule 60(b), he was required to challenge his wife's fidelity at the earliest opportunity, thus adding to the trauma of a disunited family. Rule 60(b), as applied by our courts to such cases, in effect, penalized husbands who were not always latently, at least, suspicious of their wives. These are "public policies" of which, by the passage of § 26-17A-1, we are well rid.
Furthermore, under the peculiar circumstances out of which paternity adjudications arise, it is fundamentally unfair to ignore on the basis of res judicataevidence that incontrovertibly eliminates the defendant as the biological father, where the other party to that intimate relationship has, in the initial proceeding, either misrepresented the truth to the court and to the defendant, or, as the plaintiff did in this case, suppressed crucial information about paternity. But "fundamental fairness" is the "touchstone," or essence, of due process. Walters v. National Ass'n of Radiation Survivors, 473 U.S. 305, 364 n. 11, 105 S. Ct. 3180, 87 L. Ed. 2d 220 (1985) (superseded on other grounds by 102 Stat. 4105, 4113-22); Gagnon v. Scarpelli, 411 U.S. 778, 790, 93 S. Ct. 1756, 36 L. Ed. 2d 656 (1973) (modified in part on other grounds by statute). "Court proceedings are held for the solemn purpose of endeavoring to ascertain the truth which is the sine qua non of a fair trial." Estes v. Texas, 381 U.S. 532, 540, 85 S. Ct. 1628, 14 L. Ed. 2d 543 (1965). "It is precisely the function of a judicial proceeding to determine where the truth lies." Imbler v. Pachtman, 424 U.S. 409, 439, 96 S. Ct. 984, 47 L. Ed. 2d 128 (1976) (White, J., concurring in the judgment).
Thus, § 26-17A-1 was enacted to address the injustice that results when a man is required to support a child where scientific evidence excludes him as the father, and it arose naturally out of the reluctance of the judiciary in cases such as this one to remedy that injustice. Also, it illustrates a legal system that is struggling to adjust to the new and ever-changing realities thrust upon it by rapidly accelerating advancements in society's genetic identification capacity.
Finally, this opinion should not be construed as callous toward the interests of children. To be sure, there is a facile advantage to children to be supported by some man, even one who is not the biological father. But this advantage is only a short-term advantage. Children also have strong interests in knowing who, in fact, their fathers are, or, conversely, in knowing who their fathers are not.
While debate continues over the relative influences of heredity and environment, one thing is clearthe mystic bonds of blood are strong. The strength of these bonds is illustrated in various ways and is observable in ordinary experience. A familiar example is that of adopted children who are nurtured to maturity by exemplary adoptive parents, but, nevertheless, ultimately feel compelled to seek out their biological parents.
A strong sense of personal identity is an asset, and personal identity derives in large measure from knowledge of, and association with, individuals of biological kinship. Thus, blood bonds can, and do, provide long-term stability and support. Section 26-17A-1 does nothing to impair that long-term goal, and, in fact, facilitates it.
In summary, § 26-17A-1 does not violate the principle of separation of powers, even when applied "retroactively." It simply focuses on the duty to pay child support and prohibits a paternity defendant from a recovery of any sort, including past payments of child support. The legal and practical effect of § 26-17A-1 is purely prospective. Therefore, I concur in part and dissent in part.
[1] By addressing "paternity," instead of "child support," the Legislature evidenced an intent to expand the scope of Rule 60(b)(6)'s exception to res judicata with respect to paternity judgments. Compare Ex parte W.J., 622 So. 2d 358 (Ala.1993) (holding that a prior judgment determining "paternity" was subject to res judicata), with Tucker v. Tucker, 681 So. 2d 592, 594 (Ala.Civ.App.1996) (stating that "judgments as to child support are never res judicata").
Moreover, § 26-17A-2, which limits the relief available upon the setting aside of a paternity judgment, provides:
"In any decree setting aside an order of paternity pursuant to this chapter, there shall be no claim for damages against the court rendering the initial order of paternity nor any reimbursement or recoupment of money or damages against the mother, the State, or any employee or agent of the State."
(Emphasis added.) Thus, in addition to using the word "paternity," instead of the term "child support," the Legislature precluded the "recoupment of ... damages against the mother." The word "damages," as used in § 26-17A-2, prevents not only the recovery of previously paid child support, but also the recovery of damages for the false accusation of paternity, or for defamation. See K.M. v. G.H., 678 So. 2d 1084, 1088 (Ala.Civ.App.1995) (stating that § 26-17A-2 prevents the recovery of damages against the mother for the false accusation of paternity), cert. quashed, 678 So. 2d 1084 (Ala.Civ.App.), cert. denied, ___ U.S. ___, 117 S. Ct. 511, 136 L. Ed. 2d 401 (1996); see generally Anderton v. Gentry, 577 So. 2d 1261, 1263-64 (Ala.1991) (explaining the elements of defamation and slander related to accusations concerning sexual conduct). It therefore appears that the Legislature intended § 26-17A-1 to provide a broader avenue for relief from the numerous consequences of erroneous paternity determinations than was provided by Rule 60(b)(6) as interpreted in W.J., 622 So. 2d at 360.
[2] We note that § 26-17A-1 provides for the reopening of a final judgment of paternity "[u]pon petition of the defendant in a paternity proceeding where the defendant has been declared the legal father." (Emphasis added.) The phrase "paternity proceeding" is a broad phrase, and its plain meaning encompasses any legal proceeding at which paternity is determined. See generally State ex rel. Johnson v. Independent School Dist. No. 810, 260 Minn. 237, 245, 109 N.W.2d 596, 602 (1961) (defining "proceeding" to include "actions and special proceedings before judicial tribunals as well as proceedings pending before quasi-judicial officers and boards"). In Alabama, an action to determine paternity "may be joined with an action for divorce, annulment, separate maintenance or support." Ala.Code 1975, § 26-17-9(a). We conclude that § 26-17A-1 applies to allow a court to reopen any judgment of paternity, whether entered pursuant to a paternity action, a divorce action, or some other action. Cf. Latourell v. Dempsey, 518 N.W.2d 564, 566 (Minn.1994) (construing "proceedings under [the Minnesota Parentage Act]" to include child custody and visitation proceedings). Our conclusion makes unnecessary any discussion of the guardian ad litem's argument that § 26-17A-1 discriminates against certain children based on the type of proceeding at which paternity was adjudicated.
[3] We note that although the parties raised no issue regarding the Contracts Clause, this Court has previously stated that "[a] judgment is a contract." Weaver v. Lapsley, 43 Ala. 224, 233 (1869). In Weaver, at 230-31, 233, this Court held that a statute declaring certain final judgments void and granting new trials violated both the separation-of-powers principle and the Contracts Clause of the Constitution of Alabama of 1865. See generally Ala. Const.1901, § 22 ("[N]o ex post facto law, nor any law, impairing the obligations of contracts ... shall be passed by the legislature...."); § 95 ("There can be no law of this state impairing the obligation of contracts by destroying or impairing the remedy for their enforcement....").
[4] Montesquieu further posited:
"The political liberty of the subject is a tranquillity of mind arising from the opinion each person has of his safety. In order to have this liberty, it is requisite the government be so constituted as one man need not be afraid of another.
"When the legislative and executive powers are united in the same person, or in the same body of magistrates, there can be no liberty; because apprehension may arise, lest the same monarch or senate should enact tyrannical laws, to execute them in a tyrannical manner.
"Again, there is no liberty, if the judiciary power be not separated from the legislative and executive. Were it joined with the legislative, the life and liberty of the subject would be exposed to arbitrary control; for the judge would be then the legislator. Were it joined to the executive power, the judge might behave with violence and oppression."
I Montesquieu, The Spirit of the Laws 151-52 (Thomas Nugent trans., 1900). Montesquieu's theory reflected the practical lessons of history concerning the concentration of governmental power. 1 Joseph Story, Commentaries on the Constitution of the United States § 524 (5th ed. 1891) ("The general reasoning by which the [separation-of-powers] maxim, is supported ... seems entirely satisfactory[, but w]hat is of far more value than any mere reasoning, experience has demonstrated it to be founded in a just view of the nature of government, and the safety and liberty of the people.").
[5] Thus, the Framers' intent to incorporate Montesquieu's separation-of-powers maxim into the architecture of the Constitution became a practical reality:
"By the time of President Jackson, the structure of separated powers was so well institutionalized that, as Professor Forrest McDonald has written, `... The order was firmly established and self-maintaining: constitutional government had become part of the second nature of homo politicus Americanus.' Thus the intent of the Framers has survived not merely as a theory of how this government should work but as an explanation of how it does in fact work."
John S. Baker, Jr., Constitutional Architecture, 16 Harv. J.L. & Pub. Pol'y 59, 65-66 (1993) (quoting Forrest McDonald, Novus Ordo Seclorum: The Intellectual Origins of the Constitution 292 (1985)).
[6] Sanders dealt with the predecessor to § 42 of the Constitution of Alabama of 1901Article III of the Constitution of Alabama of 1865which provided:
"§ 1. The powers of the government of the state of Alabama shall be divided into three distinct departments, each of which shall be confided to a separate body of magistracy to wit: Those which are legislative to one; those which are executive to another; and those which are judicial to another.
"§ 2. No person, or collection of persons, being of one of those departments, shall exercise any power properly belonging to either of the others, except in the instances hereinafter expressly directed or permitted."
[7] Chief Justice Marshall, the author of Marbury v. Madison, had strong convictions about the separation-of-powers principle. See Jean Edward Smith, John Marshall: Definer of a Nation 78 (1996) ("From Montesquieu, whose seminal work, The Spirit of the Laws, was translated into English in 1750, Marshall derived a crisp understanding of the doctrine of the separation of powers.").
[8] The principle of separation of powers is especially pertinent with respect to the reopening of judicial decrees. Alexander Hamilton noted:
"A legislature, without exceeding its province, cannot reverse a determination once made in a particular case; though it may prescribe a new rule for future cases."
The Federalist No. 81, at 484 (Alexander Hamilton) (Clinton Rossiter ed., 1961).
[9] Justice Maddox and Justice Cook suggest that the separation-of-powers principle should operate only to prevent a statute from depriving a person of a "vested right." 723 So. 2d at 663 (Maddox, J., concurring in part, concurring in the result in part, and dissenting in part); 723 So. 2d at 669 (Cook, J., concurring in part and dissenting in part). Justice Maddox and Justice Cook state that Plaut can be distinguished from this case because Plaut dealt with an extension of the statutory limitations period that affected vested rights of the parties.
Although mentioned in dicta in cases interpreting various constitutional provisions, the concept of "vested rights" primarily concerns due process and common-law protections of individual interests from governmental action, not the specific source of the governmental action. See, e.g., Bingham v. City of Tuscaloosa, 383 So. 2d 542, 544 (Ala.1980) (stating that "on general due process grounds, ... any regulatory scheme enacted by the City that fails to recognize vested rights of prior interest holders" is invalid) (emphasis added); Barrington v. Barrington, 200 Ala. 315, 76 So. 81 (1917) (holding that although a statute did not violate the Constitution by impairing a contract or imposing an ex post facto punishment, it would not be applied retroactively because it affected a vested right). In contrast, the separation-of-powers principle primarily concerns the manner in which the government exercises power, not the status of a specific right harmed by the exercise of that power. See, e.g., Plaut, 514 U.S. at 239, 115 S. Ct. 1447 ("[T]he doctrine of separation-of-powers is a structural safeguard rather than a remedy to be applied only when specific harm, or risk of specific harm, can be identified.") (emphasis in original); Broadway v. State, 257 Ala. 414, 60 So. 2d 701 (1952) (holding, without finding any vested right, that the Legislature could not usurp the power to reopen judgments made final by the Judiciary); see generally Weaver v. Graham, 450 U.S. 24, 29-31 nn. 10 & 13, 101 S. Ct. 960, 67 L. Ed. 2d 17 (1981) (stating that the Ex Post Facto Clause, which operates on statutes regardless of their effect on "vested rights," supports the separation-of-powers principle by confining the Legislature to the enactment of prospective criminal sanctions, and the Judiciary to the application of existing criminal law).
This distinction was clearly illustrated in Plaut, where the Supreme Court recognized that Congress's retroactive extension of a limitations period does not violate the Due Process Clause by depriving defendants of a vested right. Plaut, 514 U.S. at 227-29, 115 S. Ct. 1447 (stating that Congress may retroactively extend a limitations period without violating the Due Process Clause) (citing Chase Securities Corp. v. Donaldson, 325 U.S. 304, 311 n. 8, 316, 65 S. Ct. 1137, 89 L. Ed. 1628 (1945) (noting that the retroactive extension of a statutory limitations period did not deprive defendants of a "vested right")). Nonetheless, the Supreme Court held that Congress violated the separation-of-powers principle by commanding the Judiciary to reopen final judgments to accommodate the extended limitations period. Plaut, 514 U.S. at 219, 115 S. Ct. 1447 (stating that Congress's command to reopen final judgments to accommodate the retroactive extension of the statutory limitations period violated the separation-of-powers principle).
[10] The federal version of Rule 60(b) is substantially similar to the Alabama version of Rule 60(b). The major differences are: (1) that while Alabama's rule provides 120 days to file motions to reopen judgments on the basis of mistake, newly discovered evidence, or fraud, the federal rule provides 1 year; and (2) that while Alabama's rule provides for an independent proceeding to set aside certain judgments within 3 years, the federal rule provides for no such proceeding.
[11] Both Congress and the Alabama Legislature may modify or replace rules of procedure, within constitutional limits. Under the Rules Enabling Act, 28 U.S.C. §§ 2072 and 2074, the Supreme Court promulgates rules of civil procedure and submits them to Congress for approval. In Sibbach v. Wilson & Co., 312 U.S. 1, 9-10, 61 S. Ct. 422, 85 L. Ed. 479 (1941), the Supreme Court stated: "Congress has undoubted power to regulate the practice and procedure of federal courts, and may exercise that power by delegating to this or other federal courts authority to make rules not inconsistent with the statutes or constitution of the United States...." Similarly, § 6.11 of Amendment 328 of the Constitution of Alabama of 1901 authorizes the Legislature to change rules of practice and procedure for Alabama courts "by a general act of statewide application."
Although § 6.11 permits the Alabama Legislature to change rules of procedure by statutes of statewide application, this rulemaking power, like that of Congress, is not plenary. Thus, the Legislature could not, by a statute purporting to replace a rule of appellate procedure, strip the Judiciary of the power to make judgments final, and vest that power, for example, in the Alabama Senate. See Ala. Const. §§ 42, 43; amend. 328, § 6.01, 6.02; see generally Kline v. Burke Constr. Co., 260 U.S. 226, 234, 43 S. Ct. 79, 67 L. Ed. 226 (1922) (noting that Congress may not restrict the constitutional jurisdiction of the Supreme Court); Martin v. Hunter's Lessee, 14 U.S. (1 Wheat.) 304, 328-31, 4 L. Ed. 97 (1816) (stating that the full judicial power must be vested in some court). Nor could the Legislature, by a statute purporting to replace a rule of civil procedure, divest itself of the power to tax and spend and vest that power in the Judiciary. See Ala. Const. §§ 42, 43, 72; amend. 328, § 6.01; Opinion of the Justices No. 211, 291 Ala. 262, 265, 280 So. 2d 97, 100 (1973) ("The levying of a tax is a purely legislative power...."); Opinion of the Justices No. 64, 244 Ala. 386, 389, 13 So. 2d 674, 677 (1943) (stating that under § 72 of the Constitution of Alabama of 1901 "no money shall be paid out of the State treasury except by an appropriation by the Legislature").
[12] Justice Cook states that the holding of the Supreme Court in United States v. Sioux Nation of Indians, 448 U.S. 371, 100 S. Ct. 2716, 65 L. Ed. 2d 844 (1980), establishes that § 26-17A-1 does not violate the separation-of-powers principle. 723 So. 2d at 671-72 (Cook, J., concurring in part and dissenting in part). In Sioux Nation, 448 U.S. at 407, 100 S. Ct. 2716, the Supreme Court held simply that where the Government is a party to a case, it can waive its own res judicata defense without violating the separation-of-powers principle. But § 26-17A-1 does more than waive the State's own res judicata defense in paternity actions; it clearly applies to numerous cases in which the State is not a party because the mother and child have not received financial assistance from the State. See, e.g., Gann v. Gann, 705 So. 2d 509 (Ala.Civ.App.1997) (addressing a paternity challenge by a previously adjudicated father, where the State was not a party); Simmons v. Ellis, 628 So. 2d 804, 804 (Ala.Civ.App.1993) (holding that a paternity challenge was barred by the doctrine of res judicata in an action where the State was not a party); Quebedeaux v. Lord, 599 So. 2d 51 (Ala.Civ.App. 1992) (holding that the issue of paternity was barred by the doctrine of res judicata in an action where the State was not a party). Indeed, in R.L.T. v. S.V.P., 703 So. 2d 1002 (Ala.Civ.App. 1997), the Court of Civil Appeals expressly applied § 26-17A-1 to reopen a paternity judgment in which the State was not a party. Justice Cook cites no authority, nor are we aware of any, that empowers the State to assert or to waive the defense of res judicata on behalf of others in cases to which the State is not a party.
Consequently, Justice Cook's argument, like that of the dissenters in Plaut, 514 U.S. at 255-56, 115 S. Ct. 1447 (Stevens, J., dissenting), depends on a substantial broadening of the precedent of Sioux Nation to exempt from the operation of the separation-of-powers principle remedial legislative measures that do more than waive the Government's own res judicata defense. The majority of the Supreme Court expressly rejected the attempt to broaden the holding of Sioux Nation, concluding:
"[O]ur holding was as narrow as the precedent on which we had relied: `In sum, ... Congress' mere waiver of the res judicata effect of a prior judicial decision rejecting the validity of a legal claim against the United States does not violate the doctrine of separation of powers.'"
Plaut, 514 U.S. at 230-31, 115 S. Ct. 1447 (quoting Sioux Nation, 448 U.S. at 407, 100 S.Ct. 2716).
[13] We note that in K.M. v. G.H., 678 So. 2d 1084 (Ala.Civ.App.1995), cert. quashed, 678 So. 2d 1084 (Ala.Civ.App.), cert. denied, ___ U.S. ___, 117 S. Ct. 511, 136 L. Ed. 2d 401 (1996), the Court of Civil Appeals concluded that § 26-17A-1 did not violate various provisions of the Constitution of Alabama, despite a spirited dissent arguing a separation-of-powers violation, id. at 1089, 1091-97 (Crawley, J., dissenting). This Court's order quashing the writ of certiorari in K.M., like a denial of a writ of certiorari, constituted no expression of approval, on the merits, of the opinion of the Court of Civil Appeals. See generally Ex parte Gentry, 689 So. 2d 916, 920 n. 2 (Ala. 1996). Our holding today overrules K.M. to the extent that decision upheld the retroactive application of § 26-17A-1.
[14] Section 27A(b) of the Securities Exchange Act of 1934, the statute struck down by the Supreme Court in Plaut, 514 U.S. at 214-15, 115 S. Ct. 1447, expressly reopened prior final judgments, by providing:
"(b) Effect on dismissed causes of action
"Any private civil action implied under section 78j(b) of this title that was commenced on or before June 19, 1991
"....
"shall be reinstated on motion by the plaintiff not later than 60 days after [§ 27A(b)'s becoming law on] December 19, 1991."
Similarly, § 5 of the 1868 act under consideration in Sanders, 43 Ala. at 177, provided:
"Be it further enacted, That any judgments or decrees rendered since the 25th day of May, 1865, when the original cause of action originated prior to that date, such judgment or decree shall be opened on application as hereinbefore provided, accompanied with an affidavit that such cause of action did originate prior to the 25th day of May, 1865."
[15] Rule 60(b), Ala. R. Civ. P., provides in pertinent part:
"Mistakes; Inadvertence; Excusable Neglect; Newly Discovered Evidence; Fraud, etc. On motion and upon such terms as are just, the court may relieve a party or a party's legal representative from a final judgment, order, or proceeding for the following reasons: (1) mistake, inadvertence, surprise, or excusable neglect; (2) newly discovered evidence which by due diligence could not have been discovered in time to move for a new trial under Rule 59(b); (3) fraud (whether heretofore denominated as intrinsic or extrinsic), misrepresentation, or other misconduct of an adverse party; (4) the judgment is void; (5) the judgment has been satisfied, released, or discharged, or a prior judgment upon which it is based has been reversed or otherwise vacated, or it is no longer equitable that the judgment should have prospective application; or (6) any other reason justifying relief from the operation of the judgment. The motion shall be made within a reasonable time, and for reasons (1), (2), and (3) no more than four (4) months after the judgment, order, or proceeding was entered or taken."
(Emphasis added.)
[16] Justice Kennedy states that § 26-17A-1 violates the Equal Protection Clause of the Fourteenth Amendment to the Constitution of the United States. 723 So. 2d at 665 (Kennedy, J., concurring in part and dissenting in part). This broad equal protection argument was not raised by the parties, and we reach no conclusion on the matter. We note, however, that § 26-17A-1's provision of relief for previously adjudicated fathers accommodates the practical difficulties inherent in proving paternity, as contrasted with proving maternity. See Lalli v. Lalli, 439 U.S. 259, 99 S. Ct. 518, 58 L. Ed. 2d 503 (1978). Further, we note that the more flexible "reasonable time" requirement we announce today for Rule 60(b)(6), Ala. R. Civ. P., is available to all parties to a paternity judgment.
[17] The statute in question reads:
"§ 26-17A-1. Reopening of paternity case.
"(a) Upon petition of the defendant in a paternity proceeding where the defendant has been declared the legal father, the case shall be reopened if there is scientific evidence presented by the defendant that he is not the father. The court shall admit into evidence any scientific test recognized by the court that has been conducted in accordance with established scientific principles or the court may order a blood test, or a Deoxyribose Nucleic Acid test of the mother, father, and child. Whenever the court orders a test and any of the persons to be tested refuse to submit to the test, the fact shall be disclosed at the trial, unless good cause is shown.
"(b) The test shall be made by a qualified expert approved by the court. The expert may be called by the court or any party as a witness to testify to the test results and shall be subject to cross-examination by the parties. The test results may be admitted into evidence. If more than one test is performed and the results are conflicting, none of the test results shall be admissible as evidence of paternity or nonpaternity.
"(c) Compensation of the expert witness shall be paid by the petitioner.
"(d) In the event the child has been adopted the matter of paternity may not be reopened under this chapter."
This provision is followed by § 26-17A-2, which provides:
"In any decree setting aside an order of paternity pursuant to this chapter, there shall be no claim for damages against the court rendering the initial order of paternity nor any reimbursement or recoupment of money or damages against the mother, the State, or any employee or agent of the State."
(Emphasis added.)
[18] When I use the term "illegitimate" I refer not only to a child born out of wedlock, but also to a child born in wedlock but fathered by a man who is not the mother's husband. See, Leonard v. Leonard, 360 So. 2d 710 (Ala.1978).
[19] For example, in Leonard v. Leonard, 360 So. 2d 710 (Ala.1978), I dissented because the evidence clearly showed that the children in that case were illegitimate. In Ex parte Presse, 554 So. 2d 406 (Ala.1989), I dissented because the evidence clearly showed that the child that was the subject of that proceeding was illegitimate.
[20] The question whether the Legislature has the power to impact the payments and other obligations already fulfilled by the man adjudicated to be the father is not raised in this case. In § 26-17A-2, the Legislature specifically stated that a man who successfully obtains relief from a prior paternity adjudication under § 26-17A-1 may not make a claim for reimbursement or recoupment of money or damages against the mother, the State, or any employee or agent of the State. In other words, § 26-17A-1 cannot affect a prior paternity judgment insofar as it relates to money already paid to and received by the mother, because there can be no reimbursement or recoupment of money from the mother or other damages against her. K.M. v. G.H., 678 So. 2d 1084 (Ala.Civ.App.1995), cert. denied, ___ U.S. ___, 117 S. Ct. 511, 136 L. Ed. 2d 401 (1996).
[21] Of course, the separation-of-powers decisions of federal courts do not control the application of this principle in cases based on the Alabama Constitution. Because the concept has the same genesis, however, whether applied in the court system of the United States or in the court system of Alabama, decisions of the United States Supreme Court are highly persuasive. See Quinton v. General Motors Corp., 453 Mich. 63, 77-78, 551 N.W.2d 677, 683 (1996).
[22] The Act of February 28, 1877, 19 Stat. 254 ("the 1877 Act"), codified an "agreement" in which the Sioux Nation ceded the Black Hills to the United States. 448 U.S. at 382-83, 100 S. Ct. 2716.
[23] Section 26-17-7 provides:
"Actions commenced under this chapter by the Department of Human Resources shall be in the name of the State of Alabama on relation of the complaining witness or party against the person claimed to be the father or against the person alleged to owe a duty of support as the defendant. In any action brought by the department, the district attorney, special prosecutor, or attorney otherwise authorized to represent the State of Alabama shall appear and prosecute the proceedings brought under this chapter."
(Emphasis added.)
[24] The presumption applies in this case because J.M.B was born within the 300-day, statutory period. See Ala.Code 1975, § 26-17-5(a)(1) ("A man is presumed to be the natural father of a child if ... the child is born during the marriage, or within 300 days after the marriage is terminated by ... divorce"). | ed9486661a1325a0e229369c3056707080d41ea550045e2bf5aab47da8c52bf4 | 1998-07-17 00:00:00 |
cdf40d68-fec7-4acd-b60d-eb1f7610fb67 | Yeager v. General Motors Acceptance Corp. | 719 So. 2d 210 | 1961483 | Alabama | Alabama Supreme Court | 719 So. 2d 210 (1998)
Richard A. YEAGER
v.
GENERAL MOTORS ACCEPTANCE CORPORATION and Solomon Chevrolet Motor Company, Inc.
1961483.
Supreme Court of Alabama.
August 28, 1998.
Frederick T. Kuykendall III, Joe R. Whatley, Jr., Russell Jackson Drake, and Charlene P. Cullen of Cooper, Mitch, Crawford, Kuykendall & Whatley, L.L.C., Birmingham; Samuel A. Cherry and Larry E. Givens of Cherry, Givens, Peters, Lockett & Diaz, P.C., Dothan; and Richard A. Freese of Langston, Fraser, Sweet & Freese, P.A., Birmingham, for appellant.
Jere C. Segrest and Kevin Walding of Hardwick, Hause & Segrest, Dothan, for General Motors Acceptance Corp.
Lee E. Bains, Jr., Jarred O. Taylor II, and Edward A. Hosp of Maynard, Cooper & Gale, P.C., Birmingham, for amicus curiae World Omni Financial Corp.
COOK, Justice.
The plaintiff Richard Yeager appeals from a summary judgment for the defendants General Motors Acceptance Corporation ("GMAC") and Solomon Chevrolet Motor Company, Inc. We affirm.
The facts are undisputed. On or about May 24, 1995, Richard Yeager entered into a lease agreement with the Solomon Chevrolet dealership for the lease of an automobile. In accordance with the lease agreement, Yeager was required to pay a refundable security deposit of $350.00. The lease agreement was later assigned to GMAC. On June 27, 1996, Yeager sued, on behalf of himself and all others similarly situated, alleging that GMAC and Solomon Chevrolet had violated § 7-9-207, Ala.Code 1975, and had committed fraudulent suppression; he based the claims on the defendants' alleged failure to pay interest on the $350.00 security deposit. On September 11, 1996, Yeager amended his complaint to include claims that GMAC and Solomon Chevrolet had violated the Consumer Leasing Act by failing to disclose that it would not pay interest on the security deposit, and to ask for an equitable reformation of the lease agreement.
On April 23, 1997, the trial court entered a summary judgment for the defendants, agreeing with their contention that § 7-9-207(2)(c) did not require that the lessor of an automobile pay the lessee interest on the security deposit made under the automobile lease agreement. On May 28, 1997, Yeager appealed.
In pertinent part, the lease agreement provides, with respect to the security deposit:
The issue is whether Alabama's Uniform Commercial Code, specifically § 7-9-207(2)(c), applies, that is, whether there is a security interest created in a security deposit under an automobile lease agreement that entitles the lessee to interest on the security deposit. Although this issue has been squarely addressed in several other jurisdictions, it is a matter of first impression in this state.
Section 7-9-102(1)(a), a part of Alabama's version of the Uniform Commercial Code, states that Article 9 of the U.C.C., "Secured Transaction" (§ 7-9-101 through § 7-9-507) applies "[t]o any transaction (regardless of its form) which is intended to create a security interest in personal property or fixtures." A "security interest" is defined within the U.C.C. as "an interest in personal property or fixtures which secures payment or performance of an obligation." § 7-1-201(37)a.
Yeager claims that his automobile lease is a "transaction," as that word is used in § 7-9-102(1)(a), because, he says, the security deposit made pursuant to the automobile lease agreement was money deposited to secure payment of the amounts due under the lease agreement. This claim is premised on the theory that "security deposits" are "security interests," and, therefore, are "collateral" under the U.C.C. Yeager argues that the deposits, as collateral, would be subject to § 7-9-207(2)(c), which reads:
GMAC and Solomon Chevrolet argue that when money is paid as a security deposit ownership of the money is transferred to the holder of the deposit. They further contend that Yeager retained no interest in the funds, but, instead, held a contract right to have an equivalent amount of money, or some lesser amount, returned to him at the termination of the lease. Consequently, GMAC and Solomon Chevrolet argue that the security deposit cannot be classified as "collateral" subject to the requirements of § 7-9-207(2)(c). They argue that Yeager's making a refundable security deposit created a debt, not a pledge of collateral, and that the lease agreement in no way indicated any intention on his part or on their part to create a security interest in the security deposit.
Other jurisdictions have addressed this issue, often with guidance from statutes that speak specifically to whether a security deposit for an automobile lease should be returned to the lessee with interest. The rule governing security deposits in New York appears in the New York General Obligations Law § 7-101 (as amended 1997), which changes the common-law relationship by providing that a security deposit is held by the lessor in trust for the lessee. New York General Obligations law § 7-101 (1998) reads in pertinent part:
In Illinois, the enactment of the U.C.C. had no discernible effect on the lessor's duties concerning the lessee's security interest, because Illinois had enacted a statute in 1921 governing security deposits made in regard to leases of personal property. Subsequently, the Consumer Deposit Security *212 Act of 1987, 815 Ill. Comp. Stat. 165/1-5 (West 1998), was enacted to address the specific issue of security deposits with regard to consumer transactions, and that Act replaced the 1921 statute. The Consumer Deposit Security Act of 1987 requires that the lessor either file a surety bond with the Illinois attorney general, or place the full amount of the security deposit received in an account in the name of the lessor; advise the lessee of the name and address of the institution holding the account; and clearly denote that the account is for the purpose of handling security deposits. 815 Ill. Comp. Stat. 165/3(b). Generally, if the account is an interest-bearing account, then the party entitled to the deposit at the end of the lease is entitled to all interest accrued on the deposit. Id. If the deposit amount is less than $150, interest shall accrue to the account of the lessor. Id.
Yeager argues that because this Court does not have to address a conflicting state statute and there is no common-law precedent specifically addressing this issue, the provisions of § 7-9-207(2)(c), Ala.Code 1975, clearly control the transaction in this case. We disagree.
Yeager relies primarily on Demitropoulos v. Bank One Milwaukee, N.A., 924 F. Supp. 894 (N.D.Ill.1996). In Demitropoulos, a federal district court in Illinois decided the case based on how it thought Wisconsin state courts would construe the applicability of the Wisconsin U.C.C. to security deposits made in regard to automobile lease agreements:
924 F. Supp. at 897. Furthermore, the Demitropoulos court refers to Werbosky v. Ford Motor Credit Co., [No. 95 Civ. 1876(KTD), 1996 WL 76133, February 22, 1996] (S.D.N.Y.1996) (not published in F.Supp.), quoting the following language from that case: "`[T]he defendant car lessor "correctly concede[d]" that the equivalent provision of the New York commercial code governed the security deposits at issue.'" Demitropoulos, 924 F. Supp. at 897.
Although the court in Demitropoulos relied on the authority of Werbosky, it did not recognize the underlying reasoning of Werbosky. Werbosky is cited primarily for its holding concerning the disclosure requirements of the Consumer Leasing Act ("C.L.A."), 15 U.S.C. § 1667a. The court's holding in Werbosky concerning the applicability of the New York U.C.C. as it relates to security deposits is narrowly premised and is limited to the fact that the parties did not argue or debate the applicability of the U.C.C. to security deposits made in regard to automobile lease agreements. The court noted that because the arguments were postured for the purpose of a motion to dismiss, all allegations in the complaint must be presumed true. In Werbosky, the defendant conceded that the New York U.C.C. governs the security deposit involved in the lease and that § 9-207 of the New York U.C.C imposes a duty to account to the debtor for any increases or profits; however, the defendant primarily argued, to no avail, that it did not have a duty under the C.L.A. to disclose the fact that it retained the profits.
However, in this present case, GMAC and Solomon Chevrolet make no concessions as to the applicability of § 7-9-207(c)(2) in Alabama's U.C.C. Therefore, we conclude, as several other jurisdictions have concluded, that the holding in Demitropoulos is not persuasive authority. See Wiskup v. Liberty Buick Co., 953 F. Supp. 958 (N.D.Ill.1997); Steinmetz v. Toyota Motor Credit Corp., 963 F. Supp. 1294 (E.D.N.Y.1997).
In Jester v. State, 668 So. 2d 822, at 823-24 (Ala.Civ.App.1995), the Court of Civil Appeals outlines the analysis a court must make in order to determine whether, as a matter of law, contract language shows an intention to create a security interest:
This Court utilized this analysis in General Electric Credit Corp. v. Alford & Assocs., Inc., 374 So. 2d 1316 (Ala.1979), when asked to determine whether § 7-9-207(2)(c) required the defendant lender to remit to the defendant debtor whatever profits it had earned on its reserve accounts that were specifically being held by the lender as security for a retail financing agreement between two commercial businesses. Before applying § 7-9-207(2)(c) to those reserve accounts, this Court examined the language in the agreement to determine whether that language manifested an intent to create a security interest, as required by § 7-9-102(1)(a). Alford, 374 So. 2d at 1322. After doing so, the Court wrote: "The intent to create a security interest in the reserve funds is specifically spelled out in the retail financing agreement, wherein it is stated, `It is agreed that such reserves are to be held as security for and not in lieu of performance.'" Id.
If no such intent is specifically expressed in the agreement, then no security interest is created. After applying the analysis articulated in Jester, we find no such intent specifically expressed in the language of the lease agreement executed between Yeager, GMAC, and Solomon Chevrolet. The language of the lease, with respect to security deposits, does not expressly and specifically indicate that the parties intended to create a security agreement.
Because we conclude that the trial court correctly held that § 7-9-207(2)(c) does not apply to security deposits made pursuant to an automobile lease agreement, we pretermit discussion of the other issues presented.
AFFIRMED.
HOOPER, C.J., and MADDOX, ALMON, SHORES, HOUSTON, KENNEDY, SEE, and LYONS, JJ., concur. | 56d01c20f4f5e2e8749851e785e6980e623ddc785be35c85279ff022313769b2 | 1998-08-28 00:00:00 |
785ab20f-a2c4-4224-ab15-befe25f84574 | Ex Parte Matthews | 724 So. 2d 1143 | 1971157 | Alabama | Alabama Supreme Court | 724 So. 2d 1143 (1998)
Ex parte Roderick MATTHEWS.
(In re Ex parte State of Alabama (In re State v. Roderick Matthews)).
1971157.
Supreme Court of Alabama.
August 28, 1998.
Rehearing Denied October 16, 1998.
Mark McDaniel and John Butler, Huntsville; and Cliff Hill, Madison, for petitioner.
Bill Pryor, atty. gen.; Yvonne A.H. Saxon, asst. atty. gen.; and Robert J. Becher, asst. district atty., Madison County, for respondent.
The Court of Criminal Appeals filed a "Response to Petition for Writ of Mandamus and Motions to Dismiss or in the Alternative Motion to Deny Petition," stating that "[i]f the Supreme Court grants the motion to dismiss and this case is reviewed by way of certiorari petition, this Court respectfully moves that this response be treated as an amicus curiae brief."
HOUSTON, Justice.
The Court of Criminal Appeals granted in part the defendant's petition for the writ of mandamus. State v. Matthews, 724 So. 2d 1140 (Ala.Cr.App.1998) (on application for rehearing). Pursuant to Rule 21(e)(3), Ala. R.App.P., this Court has treated the defendant's request for the writ of mandamus as a petition for a writ of certiorari under Rule 39, Ala.R.App.P., and has granted review. The judgment of the Court of Criminal Appeals is affirmed.
AFFIRMED.
HOOPER, C.J., and MADDOX, ALMON, SHORES, KENNEDY, COOK, SEE, and LYONS, JJ., concur. | 59515802684818ad7f38d6b1810887652e8b255004989b757d64121bf9e3144e | 1998-08-28 00:00:00 |
8967510e-236d-426c-8ca8-4a7f5bb30642 | Ex Parte Gilliam | 720 So. 2d 902 | 1971012 | Alabama | Alabama Supreme Court | 720 So. 2d 902 (1998)
Ex parte Christopher GILLIAM.
(In re Christopher GILLIAM v. WESTERN AUTO SUPPLY COMPANY et al.).
1971012.
Supreme Court of Alabama.
August 7, 1998.
*904 Lawrence T. King of Dillard, Goozee & King, Birmingham, for petitioner.
James J. Jenkins of Phelps, Jenkins, Gibson & Fowler, L.L.P., Tuscaloosa, for respondents.
LYONS, Justice.
Christopher Gilliam petitions for a writ of mandamus directing Judge Thomas S. Wilson of the Tuscaloosa Circuit Court to reinstate a default judgment entered in his favor in a retaliatory discharge action. For the reasons discussed below, we deny the petition.
On September 15, 1997, Gilliam sued Western Auto Supply Company, alleging that it had violated § 25-5-11.1, Ala.Code 1975, by unlawfully discharging him in retaliation for claiming and receiving workers' compensation benefits. On September 25, 1997, Western Auto's law department received from its agent the summons, the complaint, and Gilliam's initial discovery requests. Apparently, the complaint was sent to Western Auto's "risk administrator" for notification of its insurance company. Western Auto's insurance company, on October 8, 1997, denied coverage and declined to defend Western Auto. The risk administrator then sent a copy of the complaint to Western Auto's general counsel for further action.
On October 22, 1997, Western Auto's general counsel asked Gilliam's counsel for an extension of time, to allow Western Auto to retain Alabama counsel and then to file an answer. Gilliam's counsel agreed to an extension until November 15, 1997. Western Auto did not answer by November 15, and Gilliam applied for a default judgment on November 25, 1997. After an entry of default and a hearing to prove damages, the trial court entered a default judgment for Gilliam in the amount of $375,000. Not until Western Auto's general counsel received a bill of costs on January 14, 1998, did Western Auto retain Alabama counsel; on January 20, 1998, Alabama counsel filed a motion to set aside the default judgment, under Rule 55(c), Ala. R. Civ. P. The trial court granted that motion on March 4, 1998, but awarded Gilliam $1,000 in sanctions for Western Auto's delay.
In its order, the trial court found that Western Auto had failed to answer the complaint because of negligence, not willful misconduct or bad faith. Western Auto contends that the negligence occurred because it was undergoing significant corporate restructuring in September, including a downsizing of its law department. Also, Western Auto says, the position of risk administrator was eliminated in that restructuring, resulting in the transfer of 130 litigation files, including Gilliam's original complaint, to the law department in early November. These files were indexed in December, but Gilliam's complaint apparently was overlooked. Western Auto's general counsel stated that he had a copy of Gilliam's complaint on his desk or in his nearby file cabinet from October 22, 1997, to January 14, 1998, but that that copy also was inadvertently neglected.
The trial court also found that Western Auto had presented substantial evidence of a meritorious defense. This evidence consisted of an affidavit from Gilliam's supervisor stating that Western Auto terminated Gilliam because he had failed to report to work or to call in on August 18, 20, 21, 22, and 23, 1997. *905 The supervisor also stated that he had no responsibility for handling workers' compensation claims and that neither Gilliam's injury nor his compensation claim had anything to do with the termination. Western Auto also contends that it terminated Gilliam for failing to report on days prior to August 1997.
When reviewing a petition for a writ of mandamus directing a trial court to reinstate a default judgment, our review is confined to determining whether the trial court abused its discretion in setting aside the default judgment. Kirtland v. Fort Morgan Auth. Sewer Serv., Inc., 524 So. 2d 600, 604 (Ala.1988). When deciding whether to grant a motion to set aside a default judgment, a trial court has broad discretion. Id. at 604. That discretion, although broad, requires the trial court to balance two competing policy interests associated with default judgments: judicial economy and a litigant's right to defend on the merits. Id. at 604. These interests must be balanced under the two-step process we established in Kirtland.
The Kirtland rule mandates that we begin with the presumption that cases should be decided on the merits whenever it is practicable to do so. Id. This presumption exists because the right to have a trial on the merits outweighs the need for judicial economy. Id. Second, the trial court must apply a three-factor analysis in deciding whether to grant a motion to set aside a default judgment. These factors are "(1) whether the defendant has a meritorious defense; (2) whether the plaintiff will be unfairly prejudiced if the default judgment is set aside; and (3) whether the default judgment was a result of the defendant's own culpable conduct." Id. at 605.
Gilliam first contends that the trial court abused its discretion when it found that Western Auto had a meritorious defense to his retaliatory discharge claim. Specifically, Gilliam argues that Western Auto is collaterally estopped from defending against his claim by asserting that he was terminated for failing to report for work or to call in on August 18, 20, 21, 22, and 23, 1997. This estoppel claim is based on a decision of a Department of Industrial Relations appeals referee finding that Gilliam was fired on August 17.[1] Thus, Gilliam asserts, Western Auto cannot now defend on the basis that it fired him for failing to report to work after he was fired.
Even assuming, arguendo, that the doctrine of collateral estoppel applies to bar Western Auto's defense, we still cannot conclude that the trial court abused its discretion in finding evidence of a meritorious defense. A "meritorious defense," for Rule 55(c) purposes, simply means that the defendant has some plausible defense. Kirtland, 524 So. 2d at 605. From the record, the trial court could have concluded that Western Auto has at least two other plausible defenses.
Western Auto seeks to defend Gilliam's claim on the basis that it fired him because he failed to report to work on days other than the five days in August 1997, and that Gilliam's termination had nothing to do with his claiming and receiving workers' compensation benefits. Both of these reasons could be defenses to a retaliatory discharge claim under § 25-5-11.1, Ala.Code 1975. We have held that having excessive absences constitutes a legitimate reason for termination. Smith v. Dunlop Tire Corp., 663 So. 2d 914 (Ala.1995). Also, a defendant can defend a retaliatory discharge claim by rebutting a plaintiff's prima facie case. See Twilley v. Daubert Coated Prods., 536 So. 2d 1364 (Ala.1988). Cf. Alabama Great Southern Railroad Co. v. Morrison, 281 Ala. 310, 316, 202 So. 2d 155, 160 (1967). Thus, by claiming that Gilliam's dismissal had nothing to do with his claiming and receiving workers' compensation benefits, Western Auto seeks to rebut his prima facie case showing that he was fired for making the workers' compensation claim. Therefore, the trial *906 court did not abuse its discretion in finding that Western Auto has a meritorious defense.
When ruling on a Rule 55(c) motion, a trial court must also consider any prejudice that would result to the nondefaulting party should the default judgment be set aside. Kirtland, 524 So. 2d at 606. This prejudice must be substantial. Id. at 607. Gilliam alleges that he has suffered prejudice because, he says, he has had increased economic and emotional duress because of the delay of the litigation, and because the delay, he says, has caused a loss of evidence. We consider these arguments in turn.
First, this Court has consistently held that mere delay or increased cost is not sufficient to justify a refusal to set aside a default judgment. See, e.g., Cunningham v. Gibson, 618 So. 2d 1342, 1344 (Ala.1993). Thus, Gilliam's increased costs would not constitute substantial prejudice. Furthermore, we have held that an award of costs and attorney fees can offset any prejudice to a litigant caused by increased cost. See Storage Equities, Inc. v. Kidd, 579 So. 2d 605, 608 (Ala.1991). Because the trial court awarded Gilliam $1,000 in costs and attorney fees, it alleviated any prejudice to Gilliam.
Second, Gilliam alleges that he has been substantially prejudiced because, he says, the passage of time has undoubtedly affected the memories of witnesses and the availability of evidence. As a general rule, a delay that results in loss of evidence may amount to substantial prejudice. Sanders v. Weaver, 583 So. 2d 1326, 1329 (Ala.1991). However, Gilliam presented no concrete facts indicating that any witnesses are now unavailable or that any evidence has been lost. Instead, he relies merely on his allegations and conclusions. We have held that mere allegations and conclusory statements do not constitute sufficient evidence to establish facts. See Hall v. Chrysler Corp., 553 So. 2d 98, 100 (Ala.1989). Thus, the trial court did not abuse its discretion in finding that Gilliam would not incur any substantial prejudice from an order setting aside the default judgment.
Last, a trial court must evaluate "the culpability of the defaulting party's conduct." Kirtland, 524 So. 2d at 607. To warrant a refusal to set aside a default judgment, the defaulting party's actions must constitute willful conduct or conduct committed in bad faith, because "[n]egligence by itself is insufficient." Id. Bad faith or willfulness is identified by "incessant and flagrant disrespect for court rules, deliberate and knowing disregard for judicial authority, or intentional nonresponsiveness." Id. at 608.
The trial court found that Western Auto's conduct amounted to mere negligence. A trial court's finding with respect to the culpability of the defaulting party is subject to great deference. Jones v. Hydro-Wave of Alabama, Inc., 524 So. 2d 610, 616 (Ala.1988). Gilliam, however, asserts that he presented evidence of bad faith or willful misconduct by showing that Western Auto had no system for answering lawsuits in a timely fashion; that it delegated that responsibility to a paralegal; and that Western Auto's general counsel had known of the extension date.
The rule, however, is that "a defaulting party's reasonable explanation for inaction and noncompliance may preclude a finding of culpability." Kirtland, 524 So. 2d at 608. Western Auto maintains that Gilliam's complaint was overlooked because of an increased workload in its law department, an increase attributable to corporate restructuring. Western Auto also says that the complaint was "dropped through the crack" when 130 litigation files were moved to the law department for indexing and when Western Auto's general counsel inadvertently neglected the file. Western Auto also claims that its telephone call to Gilliam's counsel and its immediate response to the bill of costs indicate good-faith intentions.
These facts are similar to those in other cases in which we have held that a trial court might, in its discretion, find a reasonable explanation that precluded a finding of culpability. See E.H. Smith & Son Elec. Contractors, Inc. v. Springdale Mall Joint Venture, *907 592 So. 2d 574 (Ala.1992) (where company president's affidavit explained that the company did not receive notice because the employee who had received it apparently lost, misplaced or threw away the complaint); Bailey Mortgage Co. v. Gobble-Fite Lumber Co., 565 So. 2d 138 (Ala.1990) (employees' affidavits stated that summons and complaint were misplaced because of inadvertence, mistake, and neglect, and the company took immediate action to set aside the default). In light of these cases, and Western Auto's apparent good faith intentions, we cannot say that the trial court abused its discretion in finding that Western Auto's conduct amounted to negligence, but not bad faith or willful misconduct.
As stated, our review is confined to determining whether the trial court abused its discretion in setting aside the default judgment. Because we find no abuse of that discretion, we deny Gilliam's petition.
PETITION DENIED.
HOOPER, C.J., and MADDOX, ALMON, SHORES, HOUSTON, KENNEDY, COOK, and SEE, JJ., concur.
[1] Western Auto did not appeal from this decision. | 9262af33b6a86790bdff1b6719615da979d08713a8d945b209f1eae7ea5f2dd4 | 1998-08-07 00:00:00 |
f0b99e67-166a-46ab-b3cb-cfa0038c6259 | Ex Parte Prudential Ins. Co. of America | 721 So. 2d 1135 | 1971019 | Alabama | Alabama Supreme Court | 721 So. 2d 1135 (1998)
Ex parte The PRUDENTIAL INSURANCE COMPANY OF AMERICA.
(In re Iola Y. GOODSON, etc., et al.
v.
The PRUDENTIAL INSURANCE COMPANY OF AMERICA).
1971019.
Supreme Court of Alabama.
August 21, 1998.
*1136 M. Christian King and Floyd D. Gaines of Lightfoot, Franklin & White, L.L.C., Birmingham; and Wayne A. Schrader and Jonathan K. Tycko of Gibson, Dunn & Crutcher, L.L.P., Washington, D.C., for petitioner.
Russell Jackson Drake of Cooper, Mitch, Crawford, Kuykendall & Whatley, L.L.C., Birmingham; Whitney North Seymour, Jr., of Landy & Seymour, Jr., New York, NY; J.L. Chestnut, Jr., of Chestnut, Sanders, Sanders & Pettaway, P.C., Selma; and Joseph W. Phebus of Phebus & Winkelmann, Urbana, IL, for respondents.
HOUSTON, Justice.
The Prudential Insurance Company of America ("Prudential"), the defendant in an action pending in the Greene Circuit Court, petitions for a writ of mandamus directing the trial court to vacate its order of August 16,1996, conditionally certifying the action as a class action. We grant the writ.
Iola Y. Goodson, as attorney in fact for her incapacitated mother, Iola M. Young; and Gloria F. Pagliughi; Earnest Clay; and Joseph J. Nevills ("plaintiffs"), claiming to act on behalf of themselves and others similarly situated nationwide, sued Prudential, in the Circuit Court of Greene County, seeking damages based upon allegations that Prudential had charged the plaintiffs excessive premiums for Medicare supplement coverage, by agreeing to pay an insured treated by a physician the difference between the amount paid by Medicare and the amount of the plaintiff's physician's bill, up to the "usual and prevailing charges." On the same day they filed the complaint, the plaintiffs also filed a "Motion for Immediate and Conditional Class Certification Under Rules 23(b)(3) and 23(d)[, Ala.R.Civ.P.]." Within 17 days of the filing of that motion, and without notice to Prudential or a hearing, the trial court entered the following order:
The Greene County Circuit Court is directed to vacate its order conditionally certifying the class. Ex parte Frontier Corp., 709 So. 2d 1197 (Ala.1998); Ex parte Equity National Life Ins. Co., 715 So. 2d 192 (Ala.1997); Ex parte Citicorp Acceptance Co., 715 So. 2d 199 (Ala.1997); Ex parte First National Bank of Jasper, 717 So. 2d 342 (Ala.1997); Ex parte American Bankers Life Assur. Co., 715 So. 2d 186 (Ala.1997); and Ex parte Mercury Finance Corp. of Alabama, 715 So. 2d 196 (Ala.1997).
Before a trial court can certify a class, upon motion of the plaintiff, it must first give notice to the defendant. Ex parte Citicorp Acceptance Co., supra, 715 So. 2d at 199. The trial court also must make a "rigorous analysis" to ensure that the following Rule 23(a), Ala.R.Civ.P., prerequisites of a class action have been met:
In Ex parte Citicorp Acceptance Co., 715 So. 2d at 203, the Court held:
The trial court has not ruled on Prudential's motion for summary judgment.[1] However, we note that the uncontested evidence in the record before us indicates that none of the named plaintiffs, nor Ms. Young, has Medicare supplement coverage issued by Prudential by which Prudential agrees to pay the insured the difference between the amount paid by Medicare and the physician's bill, up to the "usual and prevailing charges." (Affidavit of Thomas H. Lindquist, with attachments, presented in support of Prudential's motion for summary judgment, appearing as Exhibit 18 to the appendix to the petition for the writ of mandamus.) Rule 23(a) "inherently mandates that the person bringing the action must be a member of the class he seeks to represent." Amason v. First State Bank of Lineville, 369 So. 2d 547, 549 (Ala. 1979). If a named plaintiff has not been injured by the wrong alleged in the complaint, then no case or controversy is presented and the plaintiff has no standing to sue either on his own behalf or on behalf of a class. Ex parte Blue Cross & Blue Shield of Alabama, 582 So. 2d 469, 474 (Ala.1991); Ex parte Exide Corp., 678 So. 2d 773, 777 (Ala. 1996); Ex parte Izundu, 568 So. 2d 771, 772 (Ala.1990).
Three persons, none of whom was an Alabama resident, moved to intervene. One of them, Harriet Byan, was the named plaintiff in a then-pending New York case, Byan v. Prudential Insurance Company of America, in which the claims were identical to the claims pleaded in the movants' amended complaint in this present case. After this motion to intervene was filed, the Supreme Court of New York, New York County, granted Prudential's motion to dismiss the Byan case and entered a judgment for Prudential. That judgment was upheld on appeal. Byan v. Prudential Ins. Co. of America, 242 A.D.2d 456, 662 N.Y.S.2d 44 (1997). Prudential filed an "Opposition to [Motion] to Intervene." Byan withdrew from the motion to intervene, and the trial court granted the motion as to the two remaining movants, who were not named plaintiffs in the New York action: Hans Raymond, who is described in the motion as "an adult resident of the State of Florida"; and Nettie Yelen, who is described in the petition as "an adult resident of the state of New Jersey." Prudential moved to dismiss, without prejudice, pursuant to Ala.Code 1975, § 6-5-430, or, in the alternative, to transfer the action to Jefferson County, Alabama, pursuant to Ala.Code 1975, § 6-3-21.1. The intervenors contend that the trial court denied the motion to dismiss on August 19, 1997. However, there is no notation on the case action summary showing such a denial; there is no written document showing such a denial; there is no order in a memorandum showing such a denial; and there is no order appended to a memorandum showing such a denial. These are the methods by which the trial court may render an order or judgment. Rule 58(a), Ala.R.Civ.P.
The following comments were made at a hearing on August 19, 1997:
The attorneys for the intervenors drafted and sent to the trial court a proposed order denying the motion, but nothing in the record indicates that the trial court rendered or entered an order in compliance with Rule 58(a) or (c). Therefore, we must assume that no order on Prudential's motion has been entered.
Alabama Code 1975, § 6-5-430, provides, in pertinent part:
(Emphasis added.)
Yelen is a resident of New Jersey. Prudential is incorporated in New Jersey (see "Class Action Complaint Amendment," appendix to petition for writ of mandamus, Exhibit 2), and has its principal office there. It is evident that a New Jersey court would be "a more appropriate forum outside [the State of Alabama]." The Legislature used the words "shall" and "must" in § 6-5-430.
Tuscaloosa County Comm'n v. Deputy Sheriffs' Ass'n of Tuscaloosa County, 589 So. 2d 687, 689 (Ala.1991) (citations omitted); see also Ex parte New England Mutual Life Ins. Co., 663 So. 2d 952 (Ala.1995), and State Dep't of Transportation v. McLelland, 639 So. 2d 1370 (Ala.1994). The word "shall" is clear and unambiguous and is imperative and mandatory. Tuscaloosa County Comm'n v. Deputy Sheriffs' Ass'n of Tuscaloosa, supra; Taylor v. Cox, 710 So. 2d 406 (Ala.1998); Ex parte First Family Financial Services, Inc., 718 So. 2d 658 (Ala.1998) (on application for rehearing) (interpreting the word "shall" as used in § 6-3-21.1). The word "shall" has been defined as follows:
Black's Law Dictionary 1375 (6th ed.1991).
Therefore, a trial court is compelled to apply the doctrine of forum non conveniens in determining whether to accept or decline to take jurisdiction of an action based upon a claim originating outside the state.
The word "must" is clear and unambiguous and is imperative and mandatory. See State Dep't of Transportation v. McLelland, 639 So.2d at 1371: "[W]e hold that the language of [Ala.Code 1975,] § 18-1A-282 [`The commissioners must, within 20 days from their appointment, make a report in writing to the probate court ....'] mandated that the probate court set aside the commissioners' report because the report was untimely."
Therefore, a trial court is compelled to dismiss the action without prejudice if, upon motion of a defendant, it is shown that there exists a more appropriate forum outside the state, taking into account the location where the acts giving rise to the action occurred, the convenience of the parties and witnesses, and the interest of justice. This Court, in Ex parte First Family Financial Services, Inc., supra, applying the phrase "in the interest of justice," held that it was an abuse of discretion for the trial court not to grant a forum non conveniens motion to transfer, when the defendant maintained no office in the county in which the case was filed and kept no documents in that county; the plaintiff did not live in that county; and no meetings had taken place between the plaintiff and employees of the defendant in that county.
The pertinent facts in this case have virtually no connection with Greene County, Alabama. None of the four named original plaintiffs resides in Greene County (although the evidently incompetent mother of one plaintiff resides in Greene County); Yelen and Raymond, who were allowed to intervene, *1139 reside in New Jersey and Florida, respectively, not in Greene County; there are no defendants who reside in Greene County; Prudential, the lone defendant in this matter, has no office in Greene County; and no material witness to any of the acts or omissions forming the basis of the complaint or the intervenors' amended complaint resides in Greene County. No documents maintained by Prudential that are relevant to or pertain to the plaintiffs' or the intervenors' policies or to any claims that may have been made under those policies are located in Greene County. None of Prudential's employees with knowledge of the matters at issue in this case is located in, or resides in, Greene County or even in Alabama. The one person who resides in Greene County, the mother of one of the plaintiffs, does not own a policy that contains the language about which the plaintiffs complain. Of the 6,002 policies sold to Alabama residents that were of the type sold to the named plaintiffs and intervenors, only 11, or less than 1/5 of 1 percent, are owned by Greene County residents, as compared to 427 owned by Jefferson County residents. Not one Greene County resident's policy contains the "usual and prevailing" language, which is the gravamen of the named plaintiffs' and the intervenors' complaints. The trial court was required to dismiss Yelen and Raymond's claims in the "interest of justice." Ex parte First Family Financial Services, Inc., supra.
The record before this Court shows that after this action was filed, Mary K. Mason moved to intervene in this action. Mason describes herself in the motion as "an adult resident citizen of Jefferson County, Alabama," and she states that she is the owner of a Prudential policy that contains the "usual and prevailing" language. (Answer to petition for writ of mandamus, Exhibit F.)
Prudential moved to dismiss without prejudice, pursuant to § 6-5-430, or to transfer the case to Jefferson County, pursuant to § 6-3-21.1. Section 6-5-430 requires dismissal without prejudice "in the interest of justice," and § 6-3-21.1 requires a transfer to another county "in the interest of justice." The trial court has the discretion to allow Mason to intervene and then to transfer the action to Jefferson County pursuant to § 6-3-21.1 (Ex parte New England Mutual Life Ins. Co., 663 So. 2d 952 (Ala.1995)); or to dismiss the intervenors' claims without prejudice, subject to such conditions as the trial court may impose that are consistent with § 6-5-430. It is directed to vacate its certification order of August 16, 1996, and to choose one of those alternatives.
WRIT GRANTED.
HOOPER, C.J., and MADDOX, SEE, and LYONS, JJ., concur.
KENNEDY, J., concurs in the result.
ALMON, SHORES, and COOK, JJ., concur in part and dissent in part.
SHORES, Justice (concurring in part and dissenting in part).
On December 16, 1997, this Court issued five opinions relating to class-action certification. Ex parte Equity National Life Ins. Co., 715 So. 2d 192 (Ala.1997); Ex parte Citicorp Acceptance Co., 715 So. 2d 199 (Ala. 1997); Ex parte First National Bank, 717 So. 2d 342 (Ala.1997); Ex parte American Bankers Life Assurance Co., 715 So. 2d 186 (Ala.1997); Ex parte Mercury Finance Co., 715 So. 2d 196 (Ala.1997). In effect, these cases held that the practice of ex parte conditional certification of class actions was improper, although trial courts had, apparently routinely, been entering such orders, relying upon the authority of Ex parte Voyager Guaranty Ins. Co., 669 So. 2d 198 (Ala.Civ. App.1995). These five cases disapproved of the practice Ex parte Voyager had spawned, and they required trial courts, before certifying a class, to hold an evidentiary hearing, at which the plaintiffs are required to carry the burden imposed by Rule 23, Ala. R. Civ. P. These cases attempted to set out the minimum requirements that must be met before a trial court may conditionally certify a class pursuant to Rule 23.
The ex parte class certification order in this case was issued on August 16, 1996. *1140 Under the holdings of the December 16, 1997, cases, that order is to be vacated, and the trial court is to hold a hearing as prescribed by Rule 23 and by those cases. No one disputes this.
Both Prudential and the plaintiffs filed motions to vacate the August 1996 order conditionally certifying the class, calling the court's attention to the five cases released on December 16, 1997. The plaintiffs acknowledged that the class certified in the earlier order was overly broad and asked the court to set an evidentiary hearing (as required by the five cases), to permit the plaintiffs to present evidence in discharge of their burden to establish all criteria for class certification under Rule 23.
These motions are still pending before the circuit court. Before a hearing could be set, Prudential moved to stay all proceedings in the trial court and filed this petition for the writ of mandamus, asking this Court to order the trial court to vacate an order that all parties agree should be vacated. Prudential also asks this Court to stay the evidentiary hearing that this Court has held is required before a valid conditional class certification can be entered. Prudential also asks this Court to order the trial court to dismiss the action without a hearing ever having been held.
In support of its argument that the trial court should be ordered to dismiss this case, Prudential relies on the doctrine of forum non conveniens (§ 6-5-430, Ala.Code 1975). However, Prudential's motion to dismiss on forum non conveniens grounds was not filed until after the case had been pending for five months and countless hours of lawyer time and judicial time had been devoted to the case. The petition for the writ of mandamus, complaining of the trial court's refusal to dismiss, was not filed in this Court until more than seven months after the trial court had denied the motion to dismiss. Even if the motion had been timely filed, we would conclude that the trial court did not abuse its discretion in denying it on the grounds that Prudential had waived any objections to venue.
Traditionally in Alabama, one must object to venue at the earliest possible time, or else the objection is waived. Rule 12, Ala. R. Civ. P.
Rule 12(b)(3), Ala. R. Civ. P. There is no question that Prudential does business in Alabama and sells many policies to the citizens of Alabama and is thus subject to the jurisdiction of Alabama's courts. By enacting § 6-5-430, the Legislature has given a defendant that is subject to the jurisdiction of the courts of Alabama the right to show that it is entitled to have the court refuse to exercise its jurisdiction, a right defendants did not previously have. However, a defendant over whom a court has jurisdiction must object to venue (on whatever grounds) in a timely manner. Rule 12, Ala. R. Civ. P.
Prudential waited five months before objecting to venue in Greene County. Although the entire record is not before us on this petition for the writ of mandamus, what is before us indicates that many hours of court time and lawyer time have been committed to this litigation. The plaintiffs admit that the original complaint was deficient in some respects; they say those deficiencies have been cured and that the delay in curing them was the result of Prudential's failure to produce discovery material for more than a year after the trial court entered an order to produce. The plaintiffs state that they are ready and able to show by evidence that they meet all Rule 23(a) requirements to maintain this class action. They argue that all deficiencies claimed by Prudential as to their ability to maintain the action will be eliminated once the trial court holds a hearing. The trial court has not denied their motion to set a hearing. This Court should not prevent a hearing by granting this mandamus petition.
*1141 The trial court should not be ordered to dismiss this action without first allowing the plaintiffs a hearing to meet the evidentiary requirements of Rule 23. Nor should the trial court be ordered by this Court to dismiss this action on forum non conveniens grounds. Prudential did not object to venue on that ground in a timely manner in the trial court and did not in a timely manner challenge in this Court the trial court's failure to transfer or to dismiss the case. Prudential has failed to establish that it is entitled to the writ of mandamus in any respect, except to have the trial court vacate its original order, which everyone agrees will be done when the trial court's action is no longer stayed.
For these reasons, I concur in part and dissent in part.
ALMON and COOK, JJ., concur.
[1] In its petition for the writ of mandamus, Prudential also asked this Court to direct the trial court to rule on its motion for summary judgment. We denied that portion of the petition on May 8, 1998, without opinion. | 3b87dda1ab285d4344e8c25a2465158d1fc26e8cc8182f840911584c62ffc2c8 | 1998-08-21 00:00:00 |
8de7faae-c7da-48db-9e9b-2c06877a30d9 | M & Associates, Inc. v. City of Irondale | 723 So. 2d 592 | 1962143 | Alabama | Alabama Supreme Court | 723 So. 2d 592 (1998)
M & ASSOCIATES, INC.
v.
CITY OF IRONDALE.
1962143.
Supreme Court of Alabama.
July 31, 1998.
Rehearing Denied October 16, 1998.
Susan S. Wagner, Frank S. James III, and Elise B. May of Berkowitz, Lefkovits, Isom & Kushner, P.C., Birmingham, for appellant.
Frank R. Parsons, Birmingham, for appellee.
Kenneth Smith, league counsel, for amicus curiae Alabama League of Municipalities.
HOUSTON, Justice.
This appeal concerns the validity of a city ordinance that bases the amount to be paid for a business license on the total gross receipts from the sales of the business both from its facilities inside the city limits and from its facilities outside the city limits. The trial court entered a judgment upholding the ordinance. We reverse and remand.
M & Associates, Inc., d/b/a Industrial Electric Supply Company, is an Alabama corporation engaged in the wholesale electrical supply business. The company, which is headquartered in the City of Irondale, sells electrical supplies from its Irondale facility, as well as from its facilities in Mobile; Marietta, Georgia; Nashville, Tennessee; Pascagoula, Mississippi; and Belle Chasse, Louisiana. M & Associates does invoicing and billing from its corporate headquarters, through a centralized accounting system. All gross receipts are transmitted to its headquarters in Irondale.
From 1990 to 1994, M & Associates calculated its business license taxes based solely on the gross receipts from sales made from its Irondale facility. Based on those calculations, M & Associates paid $5,072.84 in 1990; $6,050.50 in 1991; $5,173.00 in 1992; $5,223.86 in 1993; and $4,584.20 in 1994. Following an audit in 1994, the City of Irondale notified M & Associates that it had not properly calculated its license taxes over the previous five-year period and that it owed $116,223.46 in past-due license taxes and penalties. *593 The city based that assessment on its Ordinance No. 805-89, entitled "An Ordinance to Prescribe and Fix Licenses for Businesses, Occupations and Professions in the City of Irondale, Alabama."[1] The ordinance applied to "diverse businesses, vocations, occupations, and professions engaged in or carried on in the City of Irondale." M & Associates was classified under § 1(107) of the ordinance, which assessed a license tax against corporations "engaged in the business of offering for sale, taking or soliciting orders for sale, or selling merchandise of any description, including any such products stored in a warehouse for sale, distribution or delivery, whether as owner, dealer, agent or cosignee." M & Associates was charged the "basic rate," which was "$100.00 plus an amount equal to 1/10 of 1% of gross receipts in excess of $50,000 during the preceding year." Section 3(a) of the ordinance provided:
(Emphasis added.)
After M & Associates questioned the city's authority to tax its sales made from facilities outside the city limits, the city filed an action in the Jefferson County Circuit Court, seeking a judgment for the amount of its assessment. The city also threatened to revoke M & Associates' business license if it did not pay the assessment. M & Associates paid $92,677.97 to the city, under protest, as payment in full for the taxes the city claimed were due for the years 1990-1994. The city agreed to accept this amount (reserving its right to sue to recover the interest it claimed was owed) and to dismiss its action; M & Associates filed this present action to recover its payment, plus attorney fees and expenses of litigation, under the Alabama Litigation Accountability Act, Ala. Code 1975, § 12-19-270 et seq. The trial court's order read, in pertinent part, as follows:
"Whereas:
(Emphasis original.)
Section 11-51-90, Ala. Code 1975, provides in pertinent part:
(Emphasis added.) Section 11-45-1, Ala. Code 1975, provides:
Section 11-51-90(b) "was an admonition to municipalities to so frame their tax ordinances as to avoid transgression of the commerce clause of the federal Constitution." Ingalls Iron Works Co. v. City of Birmingham, 248 Ala. 417, 421, 27 So. 2d 788, 791 (1946) (construing Title 37, § 735, Code of 1940, the predecessor to § 11-51-90). Ordinance No. 805-89 specifically recognized that its scope was limited by federal and state law:
Relying on a number of decisions from the United States Supreme Court, including Gwin, White & Prince v. Henneford, 305 U.S. 434, 59 S. Ct. 325, 83 L. Ed. 272 (1939); Complete Auto Transit, Inc. v. Brady, 430 U.S. 274, 97 S. Ct. 1076, 51 L. Ed. 2d 326 (1977); and Tyler Pipe Industries, Inc. v. Washington State Department of Revenue, 483 U.S. 232, 107 S. Ct. 2810, 97 L. Ed. 2d 199 (1987), M & Associates contends that the ordinance upon which the city's tax assessment is based violated the Commerce and Due Process Clauses of the United States Constitution by authorizing a tax based on the total gross receipts from sales made at its facilities outside the state. Citing Complete Auto Transit, which sets out a four-part test for determining the constitutionality of local taxes on interstate commerce, M & Associates argues that a tax of the sort imposed on it by the city can be upheld against a Commerce Clause challenge only "when the tax is applied to an activity with a substantial nexus with the taxing state, is fairly apportioned, does not discriminate against interstate commerce, and is fairly related to the services provided by the State." 430 U.S. at 279, 97 S. Ct. at 1079.[2] M & Associates maintains *595 that the ordinance runs afoul of the second (fair apportionment) and fourth (fair relation) parts of the Complete Auto Transit test and, therefore, that it violates § 11-51-90. M & Associates also contends that the ordinance violates § 11-51-90 by authorizing a tax based on the gross receipts from in-state sales made at its Mobile facility.
The city contends that the Commerce Clause does not exempt businesses engaged in interstate commerce from paying a reasonable business license tax for the privilege of doing business in the city, provided that interstate commerce is not unduly burdened or discriminated against by the tax. It argues that it had the statutory authority to impose the tax and a concomitant statutory duty to enforce it. The city maintains that the amount of its tax assessment was reasonable when compared to the amount of M & Associates' gross receipts over the five years in question (approximately $110,000,000) and when considered in light of the number of services the city provides to all city residents (police protection, fire protection, water service, street maintenance, etc.).
We note at this point that business license ordinances are presumed to be reasonable and that the burden rests upon the business challenging a license tax charged to it to prove that that tax is unreasonable or that the ordinance was illegally adopted or violates the statutory or fundamental law of the United States or the State of Alabama. State Department of Revenue v. Reynolds Metals Co., 541 So. 2d 524 (Ala.1988).
It is well settled that upon a challenge, a court must evaluate, under the Complete Auto Transit test, whether a local tax is fairly apportioned; it does this by examining the nature of the tax to see whether the tax is "internally and externally consistent." The "internal consistency" test is passed only when the tax is structured so that if every state imposed an identical tax, no multiple taxation would result. In Goldberg v. Sweet, 488 U.S. 252, 260-61, 109 S. Ct. 582, 588, 102 L. Ed. 2d 607 (1989), the Supreme Court stated:
More recently, in Oklahoma Tax Comm'n v. Jefferson Lines, Inc., 514 U.S. 175, 115 S. Ct. 1331, 131 L. Ed. 2d 261 (1995), surveying its previous decisions dealing with the Commerce Clause's limitations on state taxation *596 of interstate commerce, the Court reaffirmed the long-standing principle that a state tax calculated on the basis of the gross receipts of a business must not violate the prohibition against multiple state taxation that was recognized in earlier cases such as Gwin, White & Prince, Inc. v. Henneford, supra.
In Gwin, White & Prince, the sole question was whether a Washington privilege tax measured by the gross receipts of the appellant from its business of marketing fruit shipped from Washington to different places of sale in various states and in foreign countries was an unconstitutional burden on interstate commerce. The Court held that it was, and reversed the judgment of the Washington Supreme Court:
305 U.S. at 435-41, 59 S. Ct. 325 (reversing 193 Wash. 451, 75 P.2d 1017 (1938)).
Based on these statements in Gwin, White & Prince, we conclude that the license tax authorized by Ordinance No. 805-89 was not "internally consistent," as that term has been defined by the United States Supreme Court, because, if local governments in other states in which M & Associates does businessGeorgia, Louisiana, Mississippi, and Tennesseewere to impose license taxes based on gross receipts from sales made within their respective jurisdictions, then multiple state taxation of interstate commerce would result. In other words, if M & Associates were to sell a certain piece of electrical equipment from its facility in Marietta, Georgia, that one sale would be subject to taxation in both Georgia and Alabama. A license tax ordinance that creates the possibility of such multiple taxation does not satisfy the "fair apportionment" part of the Complete Auto Transit test and, therefore, violates the Commerce Clause. In this respect we note, contrary to the city's assertions, that the Supreme Court has "categorically rejected" the necessity of a showing that any other state has actually imposed a license tax based on gross receipts.[3] See Tyler Pipe Industries, Inc. v. Washington State Department of Revenue, supra; Armco Inc. v. Hardesty, 467 U.S. 638, 104 S. Ct. 2620, 81 L. Ed. 2d 540 (1984); American Trucking Ass'ns, Inc. v. Scheiner, 483 U.S. 266, 107 S. Ct. 2829, 97 L. Ed. 2d 226 (1987). We hold, therefore, that Ordinance No. 805-89, insofar as it assessed a license tax based on M & Associates' gross receipts from out-of-state sales, violated the Commerce Clause.[4] See Oklahoma Tax Comm'n v. Jefferson Lines, Inc., supra, at 185, 115 S. Ct. 1331 ("A failure of internal consistency *599 shows as a matter of law that a State is attempting to take more than its fair share of taxes from the interstate transaction, since allowing such a tax in one State would place interstate commerce at the mercy of those remaining States that might impose an identical tax.").
The record does not indicate that the issue whether Ordinance No. 805-89 violated § 11-51-90 by authorizing a tax based on the gross receipts from sales made at M & Associates' Mobile facility was presented to the trial court as part of the stipulation of the parties; therefore, that issue is not properly before this Court.[5] In any event, we note that this Court has held that a city "can impose on businesses located within its corporate limits a license fee based upon the gross receipts of those businesses despite the fact that some of those receipts are derived from transactions conducted outside the city's corporate limits." See City of Tuscaloosa v. Tuscaloosa Vending Co., 545 So. 2d 13, 14 (Ala.1989):
Tuscaloosa Vending controls the question whether a city can base its business license tax on the gross receipts from sales made by a business outside the city limits and the police jurisdiction.
For the foregoing reasons, the judgment is reversed and the cause is remanded.
REVERSED AND REMANDED.
HOOPER, C.J., and MADDOX, ALMON,[*] SHORES, COOK, SEE, and LYONS, JJ., concur.
[1] The city repealed Ordinance No. 805-89 effective January 1, 1995, and replaced it with an ordinance that did not base license taxes on a business's total gross receipts (Ordinance No. 4-1194). However, effective January 1, 1998, the city returned to a business license tax based on total gross receipts (Ordinance No. 6-1197).
[2] The United States Supreme Court has on a number of occasions considered whether state taxes violate the Commerce Clause. The wavering doctrinal lines of the Court's pre-Complete Auto Transit cases reflect the tension between two competing concepts: the view that interstate commerce enjoys a "free trade" immunity from state taxation; and the view that businesses engaged in interstate commerce may be required to pay their own way. Complete Auto Transit sought to resolve this tension by specifically rejecting the view that the states cannot tax interstate commerce, while at the same time imposing limits on state taxation of interstate commerce. The purpose of the Complete Auto Transit test was to establish a consistent and rational method of inquiry focusing on the practical effect of a challenged tax. See Goldberg v. Sweet, 488 U.S. 252, 259-60, 109 S. Ct. 582, 102 L. Ed. 2d 607 (1989), and the cases cited therein. Since the Complete Auto Transit decision, the Supreme Court has applied its four-part test on numerous occasions. We have applied it as well. See, e.g., White v. Reynolds Metals Co., 558 So. 2d 373 (Ala.1989); Ex parte Fleming Foods of Alabama, Inc., 648 So. 2d 577 (Ala.1994).
[3] M & Associates' attorney indicated during the oral argument of this case that the record was silent as to whether any other state has imposed a gross-receipts-based license tax on M & Associates. Although the record does not appear to be completely silent, it is by no means clear. For example, Teresa Stowe, a former accounting manager and controller with M & Associates, testified by deposition:
"Q. Okay. Which of the cities and the offices that you had under your control paid a license based on gross receipts?
"A. To the best of my knowledge, the Mobile office did, the Marietta office did. I don't believe the Pascagoula office did. I never examined the licenses for Belle Chasse. At one point the Memphis license was. I do not believe that the Nashville license was based on gross receipts, but I'm not exactly sure."
Walter E. Mason, the president of the company, testified by deposition that he was not aware that the Marietta, Georgia, business license was based on gross receipts.
[4] In light of our holding that the ordinance did not pass constitutional muster under the "internal consistency" test, we pretermit any discussion of M & Associates' other arguments concerning the constitutionality of the ordinance.
[5] Also not properly before this Court is the issue whether M & Associates is entitled to an award of attorney fees and expenses under the Alabama Litigation Accountability Act. It does not appear that that issue was presented to the trial court; even if it was, the trial court, because of its holding, never reached it.
[*] Although Justice Almon was not present at oral argument in this case, he has listened to the tape of oral argument. | b08d509f324354647be8f3785b59604a705b9b8421ddff5e9c1052dc43a8831a | 1998-07-31 00:00:00 |
fd2908aa-9eaf-4299-a948-d561a764fe45 | Ex Parte Crabtree Industrial Waste, Inc. | 728 So. 2d 155 | 1970203 | Alabama | Alabama Supreme Court | 728 So. 2d 155 (1998)
Ex parte CRABTREE INDUSTRIAL WASTE, INC., and Curtis Larry Ryals II.
(Re Richard McDaniel v. Crabtree Industrial Waste, Inc., and Curtis Larry Ryals II).
1970203.
Supreme Court of Alabama.
August 21, 1998.
*156 Henry T. Morrissette and Richard M. Gaal of Hand Arendall, L.L.C., Mobile, for petitioners.
Richard D. Home, Mobile, for respondent.
PER CURIAM.
We have granted certiorari review to consider whether the Court of Civil Appeals properly applied the doctrine of res ipsa loquitur.
The facts of this case are set out fully in the Court of Civil Appeals' opinion. McDaniel v. Crabtree Industrial Waste, Inc., 728 So. 2d 151 (Ala.Civ.App.1997). A wheel came off a moving truck and caused the plaintiff to be injured. The plaintiff filed an action against the driver and the owner of the truck. The evidence showed that no one knows what caused the wheel to come off. The plaintiff relied on the doctrine of res ipsa loquitur. The driver of the truck testified that he had inspected the truck on the morning of the accident and had found no visible problems. The evidence shows that the wheel had been repaired by a third party only three days before the accident occurred, and there is evidence that at least two of the studs on the truck wheel had broken off at the hub.
For the doctrine of res ipsa loquitur to supply an inference of negligence where there is no direct evidence of negligence, the following test must be met:
Alabama Power Co. v. Berry, 254 Ala. 228, 236, 48 So. 2d 231, 238 (1950); Ward v. Forrester Day Care, Inc., 547 So. 2d 410, 411 (Ala.1989); Khirieh v. State Farm Mut. Auto. Ins. Co., 594 So. 2d 1220, 1223 (Ala. 1992).
The circuit court's final order stated:
The circuit court entered a summary judgment for the defendants. The Court of Civil Appeals reversed, stating that the plaintiff's evidence "raise[d] genuine questions of material fact under his theory of recovery," the doctrine of res ipsa loquitur. 728 So. 2d at 154.
This Court finds the observations of the circuit court particularly compelling. The doctrine of res ipsa loquitur may not be applied to hold the owner or the operator of a vehicle liable simply because a component of the vehicle has failed. The evidence presented would support an inference that the wheel came off as a result of negligence on the part of the third party, Mr. Carney, who repaired the tire three days before this event, and that no effects of any such negligence were visible to these defendants. The evidence could also support an inference that the studs broke with no warning, because of some materials failure or some other cause.
*158 Therefore, this Court disagrees with the opinion of the Court of Civil Appeals. The record suggests that the wheel could have broken loose as a result of a materials failure in two or more of the truck's studs or as a result of negligence by the third party who had repaired the tire. Because the plaintiff failed to present substantial evidence to foreclose such possibilities as these, he did not satisfy the second element of the doctrine of res ipsa loquitur, according to which "the circumstances must be such that according to common knowledge and the experience of mankind the accident could not have happened if those having control of the [instrumentality] had not been negligent." Alabama Power Co. v. Berry, supra. If one can reasonably conclude that the accident could have happened without any negligence on the part of the defendants, then the res ipsa loquitur presumption does not apply. We agree with the circuit court that the doctrine of res ipsa loquitur does not support an inference of negligence in this case.
For the foregoing reasons, the judgment of the Court of Civil Appeals is reversed, and the cause is remanded.
REVERSED AND REMANDED.
HOOPER, C.J., and MADDOX, ALMON, SHORES, HOUSTON, KENNEDY, COOK, SEE, and LYONS, JJ., concur. | 0a05521d46017797292bee0d20c7305041ff00695a391482995309625ada4031 | 1998-08-21 00:00:00 |
c2df410b-32e1-4a3a-8fe7-0edfb8c89871 | Ex Parte Hutcherson | 727 So. 2d 861 | 1970629 | Alabama | Alabama Supreme Court | 727 So. 2d 861 (1998)
Ex parte Larry Eugene HUTCHERSON.
(Re Larry Eugene Hutcherson, alias Larry Eugene Bonner v. State).
1970629.
Supreme Court of Alabama.
July 31, 1998.
Rehearing Denied December 18, 1998.
Therese H. Green, Mobile, for petitioner.
Bill Pryor, atty. gen., and A. Vernon Barnett IV, asst. atty. gen., for respondent.
SEE, Justice.
Larry Eugene Hutcherson petitioned this Court for a writ of certiorari to the Court of *862 Criminal Appeals, for review of that court's judgment affirming his capital murder conviction and his death sentence. We granted the petition, pursuant to Rule 39(c), Ala. R.App. P., and now affirm.
Hutcherson's case has been before this Court on an earlier petition. See Ex parte Hutcherson, 677 So. 2d 1205 (Ala.1996). In that proceeding, this Court reversed the judgment of the Court of Criminal Appeals, holding that the improper admission of deoxyribose nucleic acid evidence was not harmless error.
On remand, Hutcherson withdrew his plea of not guilty and pleaded guilty to capital murder.[1] Section 13A-5-42, Ala.Code 1975, provides:
The State presented its case to the jury. The jury convicted Hutcherson of capital murder and recommended by a vote of 11 to 1 that Hutcherson be sentenced to death. The trial court then proceeded to determine the sentence, considering the jury's advisory verdict, the presentence investigation report, and other relevant evidence that was presented.
The trial court found two aggravating factors: (1) that the murder was committed while Hutcherson was engaged in a burglary; and (2) that the offense was especially heinous, atrocious, or cruel. Hutcherson broke into the home of 89-year-old Irma Gray. He mercilessly beat Irma, smashing her nose and breaking her ribs. Hutcherson then raised his knife and, despite Irma's desperate plea for mercy, slashed deep into her throat time and time again. He discarded Irma's almost decapitated corpse as her blood seeped onto the floor of her home. Hutcherson then stole Irma's microwave oven, television, and radio.
The trial court found the following nonstatutory mitigating circumstances: (1) that Hutcherson's mother had not provided a nurturing, caring environment, and (2) that Hutcherson suffered periods of depression caused by the death of his adoptive father. The trial court also found the following statutory mitigating circumstances: (1) that Hutcherson had had no significant history of prior criminal activity, and (2) Hutcherson's age at the time of the crime. After weighing these circumstances, the trial court sentenced Hutcherson to death by electrocution. The Court of Criminal Appeals affirmed the conviction and the sentence. Hutcherson v. State, 727 So. 2d 846 (Ala.Crim.App.1997).
We have carefully reviewed all of the issues presented in the petition, the briefs, and the oral argument. All of the issues Hutcherson raises have been fully addressed by the Court of Criminal Appeals. We have studied the opinion of the Court of Criminal Appeals and have examined the record for plain error. We find no error, plain or otherwise, in either the guilt phase or the sentencing phase of Hutcherson's trial that would warrant a reversal of his conviction or his sentence. We therefore affirm the judgment of the Court of Criminal Appeals.
AFFIRMED.
HOOPER, C.J., and MADDOX, ALMON, SHORES, HOUSTON, KENNEDY, COOK, and LYONS, JJ., concur.
[1] Hutcherson had been indicted on two counts of capital murder: (1) intentional murder during a burglary, in violation of Ala.Code 1975, § 13A-5-40(a)(4); and (2) intentional murder during the commission of sodomy, in violation of § 13A-5-40(a)(3). When Hutcherson pleaded guilty, the State elected to proceed before the jury on only the count alleging intentional murder during a burglary. | a1312e2cf25a86922e7b003ced37603f4e34ac16a41bab32de56d269c7da6db0 | 1998-07-31 00:00:00 |
3b56b0a5-6435-485a-8bb8-7c4bfa2b953a | Ex Parte Lewter | 726 So. 2d 603 | 1961775 | Alabama | Alabama Supreme Court | 726 So. 2d 603 (1998)
Ex parte Fred LEWTER and Linda Lewter.
(Re Chris Myers Pontiac-GMC, Inc., and David P. Shepherd
v.
Fred Lewter and Linda Lewter.)
1961775.
Supreme Court of Alabama.
July 17, 1998.
Rehearing Denied October 23, 1998.
*604 Richard M. Beckish, Jr., Mobile, for petitioners.
Mark S. Gober, Fairhope, for appellee.
ALMON, Justice.
The controversy underlying this certiorari review arose when Chris Myers Pontiac-GMC, Inc., installed a new engine in a van owned by Fred Lewter and his wife Linda Lewter and the Lewters refused to pay for it, asserting that they had not authorized Myers Pontiac to make that repair. Because the repair had not been paid for, Myers Pontiac retained possession of the van; it held the van until the Lewters filed an action against Myers Pontiac, alleging conversion, and obtained a writ of seizure. Myers Pontiac counterclaimed, alleging fraud and requesting compensation under the theories of open account, quantum meruit, and unjust enrichment. The Lewters moved for a summary judgment on the counterclaim and sought attorney fees under the Alabama Litigation Accountability Act ("ALAA"), §§ 12-19-270 to -276, Ala.Code 1975.
The circuit court entered a summary judgment for the Lewters on most of the claims presented in Myers Pontiac's counterclaim and granted the Lewters' request for attorney fees pursuant to the ALAA. A jury trial *605 was held on the Lewters' remaining claims and on the remaining claims stated in the counterclaim. The jury returned a verdict awarding Myers Pontiac $1,547.85, "which[, the jury said,] is engine costs," and a verdict in favor of the Lewters stating, among other things, "punitive damages [as] legal fees." The jury was then sent back to the jury room while the judge and the attorneys had a brief discussion regarding the "punitive damages" award. The judge told the attorneys that she was "going to have to bring [the jury] back in and instruct them again," whereupon the jury was brought back to the courtroom and given the following instructions:
Myers Pontiac did not object to this instruction. After further deliberation, the jury returned to the courtroom with a verdict in favor of the Lewters stating that "punitive damages [are] thirty-eight thousand dollars." The judge then asked the attorneys for the two sides if they had anything further, and they both answered "No."
The circuit court entered a judgment on the jury verdicts. Myers Pontiac filed a motion to alter, amend, or vacate the judgment, arguing, among other things, that the jury had improperly awarded attorney fees as punitive damages. The circuit court denied the motion. Myers Pontiac appealed to the Court of Civil Appeals, complaining of the judgment entered for the Lewters on their complaint and of the ruling in their favor on the conterclaim, and also complaining of the award of attorney fees. Myers Pontiac's trial attorney, David P. Shepherd, joined the appeal, complaining of the circuit court's award of attorney fees pursuant to the ALAA. The Court of Civil Appeals affirmed the summary judgment entered for the Lewters on most of the counterclaim counts; reversed the award of attorney fees to the Lewters made pursuant to the ALAA; reversed the circuit court's denial of Myers Pontiac's post-trial motion to alter, amend, or vacate the judgment; and remanded. Chris Myers Pontiac-GMC, Inc. v. Lewter, 697 So. 2d 478 (Ala.Civ.App.1997).
We granted the Lewters' petition for certiorari review. They contend that Myers Pontiac failed to preserve any appealable issue in regard to the jury's award of attorney fees as punitive damages by failing to object at trial to the instruction to "translate for us what that amount is that you are indicating on legal fees." See Rule 51, Ala. R. Civ. P., which states that "[n]o party may assign as error ... the giving of an ... improper oral charge unless that party objects thereto before the jury retires ..., stating the matter objected to and the grounds of the objection." The Court of Civil Appeals held that Myers Pontiac did not waive the alleged error, holding that the jury, not the trial court, had erred.
The Court of Civil Appeals based this holding on McCain v. Redman Homes, Inc., 387 So. 2d 809 (Ala.1980). To the extent that McCain holds that a judgment may be reversed based on an argument that the jury erred, rather than on an argument that the trial court erred, it is today overruled. It is hornbook law that an appellate court reviews the action of the trial court for error; it does not directly review the conduct or the actions of the jury. Any improper conduct of the jury must be brought to the attention of the trial court by way of an objection or a motion, and it is the ruling on that objection or motion that can be made the subject of appellate review.
This principle is embodied in Rule 51, and it was the basis for this Court's finding no reversible error in Bush v. Alabama Farm Bureau Mut. Cas. Ins. Co., 576 So. 2d 175, 181 (Ala.1991):
Here, the circuit court properly instructed the jury in its original instructions as to the measure of punitive damages, should it decide to award them:
In spite of this correct instruction, the jury's initial verdict was to award simply "legal fees" as punitive damages. The circuit court properly instructed the jury that such an award was "not an acceptable verdict." Although the circuit court incorrectly instructed the jury to "translate for us what that amount is that you are indicating on legal fees," Myers Pontiac did not object to this instruction. This constituted a waiver of any error in that charge. BIC Corp. v. Bean, 669 So. 2d 840 (Ala.1995), cert. denied, 516 U.S. 1160, 116 S. Ct. 1045, 134 L. Ed. 2d 192 (1996); Bush v. Alabama Farm Bureau, supra.
Myers Pontiac's argument could be viewed as asserting that the initial verdict awarding "legal fees" as punitive damages was an indication of incurable misconduct or confusion by the jury. However, we see no reason why the jury's mistake could not have been cured by the court's instructing it that the verdict was improper and repeating for it the earlier instructions on the measure of punitive damages, or simply by reminding the jury of the correct law, such as by a brief statement indicating that punitive damages are awarded to punish and deter and that the measure of the amount of such damages is the gravity of the wrong and the need for deterrence. Instead, the circuit court gave a confusing instruction that was not entirely correct. Myers Pontiac could have, and should have, objected at that point, and upon that objection the circuit court could have cleared up the confusion with proper instructions. By failing to object, Myers Pontiac failed to preserve error in the circuit court's submission of the cause to the jury. The final verdict was unobjectionable, a simple award of $38,000 as punitive damages, and did not provide a proper basis for Myers Pontiac's motion for a new trial.
The circuit court properly denied Myers Pontiac's motion for a new trial.[1] Accordingly, we reverse the judgment of the Court of Civil Appeals to the extent that it reversed the denial of that motion. In other respects, that judgment is affirmed.
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.
HOOPER, C.J., and SHORES, KENNEDY, and COOK, JJ., concur.
HOUSTON, SEE, and LYONS, JJ., concur in the result.
[1] We note that, as the Court of Civil Appeals points out, Myers Pontiac's motion was actually framed as a motion to alter, amend, or vacate the judgment. See Rule 59(e), Ala. R. Civ. P. However, the asserted error Myers Pontiac argues here is one that would have supported an award of a new trial, if anything; thus, the motion would be treated as a motion for a new trial under Rule 59(a). The substance of a motion, not what a party has called it, determines the nature of the motion. Sexton v. Prisock, 495 So. 2d 581 (Ala.1986); Ex parte Hartford Ins. Co., 394 So. 2d 933 (Ala.1981). | 9b174eb3a9132fc1c5f0c26d158514677b67a5d129d3ea1cae3475c1f1bf2bbf | 1998-07-17 00:00:00 |
69a581b1-a77f-44cf-bfb8-ceeec936499e | United Companies Lending Corp. v. Autrey | 723 So. 2d 617 | 1970246 | Alabama | Alabama Supreme Court | 723 So. 2d 617 (1998)
UNITED COMPANIES LENDING CORPORATION
v.
Cecil AUTREY et al.
1970246.
Supreme Court of Alabama.
August 14, 1998.
Rehearing Denied October 16, 1998.
*618 M. Christian King and Wynn M. Shuford of Lightfoot, Franklin & White. L.L.C., Birmingham; and John N. Leach, Jr., of Helmsing, Sims & Leach, P.C., Mobile, for appellant.
George W. Finkbohner III and Royce A. Ray III of Finkbohner & Lawler, L.L.C., Mobile, for appellees.
John R. Chiles and Christopher J. Willis of Sirote & Permutt, P.C., Birmingham, for amici curiae Alabama Lenders Ass'n, Alabama Financial Services Ass'n, and Alabama Mortgage Brokers Ass'n.
H. Hampton Boles, Alan T. Rogers, and N. DeWayne Pope of Balch & Bingham, L.L.P., Birmingham, for amici curiae Alabama Bankers Ass'n and Automobile Dealers Ass'n of Alabama, Inc.
KENNEDY, Justice.
The question presented in this appeal is whether amendments to a section of the Code of Alabama may constitutionally be given retroactive effect "given that these amendments were enacted after the class members' contracts had been consummated, after this lawsuit had been pending more than two years, and after the class had been certified." (Trial court's order, C.R. 1544.) The plaintiffs were charged 8% in points on mortgage loans from United Companies Lending Corporation ("UCLC"), although § 5-19-4(g), Ala.Code 1975, prohibited lenders from charging points in excess of 5%. At the time UCLC made the loans, at the time the plaintiffs filed their complaint, and at the time their action was certified as a class action, § 5-19-19, Ala.Code 1975, provided for damages to be awarded in an action filed by debtors who had been charged illegal, excessive finance charges. The amount of recoverable damages increased if the creditor did not respond to a written demand for a refund and if the creditor made the excess finance charge in deliberate violation of, or in reckless disregard for, the law. Later, the Legislature amended § 5-19-19 to reduce the amount of damages recoverable by debtors who are charged excess finance charges.
The trial court held that a retroactive application of that amendment to the plaintiffs' claims in this action would violate Article I, § 13; Article I, § 22; and Article IV, § 95, of the Alabama Constitution of 1901.
Article I, Section 13, declares:
Section 22 declares:
Article IV governs the Legislative Department. Section 95 therein declares:
(Emphasis added.)
UCLC petitioned for, and this Court granted, permission to appeal from the interlocutory order of the circuit court holding that the statutory amendment could not be retroactively applied to the plaintiffs' claims. Rule 5, Ala. R.App. P. The only question presented is the amount of damages recoverable, i.e., whether the amendment reducing allowable damages applies to these plaintiffs' claims.
The action pending in the Mobile Circuit Court is a class action requesting damages as provided for in § 5-19-19, Ala.Code 1975, as that section read at the times pertinent to this action and until its amendment by Act No. 96-576, 1996 Ala. Acts p. 887. Section 5-19-19 is part of the Mini-Code, which the legislature enacted in 1971. Act No. 2052, 1971 Ala. Acts p. 3290. Until the May 20, 1996, amendment of § 5-19-19 by Act No. 96-576, that section had remained unchanged since the enactment of the Mini-Code in 1971. Section 5-19-19 was codified from Act No. 2052, § 15, which read:
This present action pertains to consumer home mortgage loans made by UCLC to members of the plaintiff class in 1991. Cecil Autrey and Willie Mae Autrey, husband and wife, filed a complaint against UCLC on April 20, 1994, alleging that UCLC had violated § 5-19-4(g), which prohibits creditors from charging "points" in excess of 5% of the original principal balance of the loan. The Autreys amended their complaint on May 11, 1994, to allege claims on behalf of a class of similarly situated plaintiffs. UCLC charged 8% in points on the mortgage loans that are the subject of the class allegations. On June 6, 1994, UCLC removed the action to a federal court; on January 3, 1995, after extensive proceedings, the federal court remanded the cause.
On April 10, 1995, four additional persons filed a motion to intervene as plaintiffs, and the circuit court granted that motion on June 5, 1995. Through discovery, 910 members of the plaintiff class were identified. On September 8, 1995, the plaintiffs, acting pursuant to the provisions of § 5-19-19, demanded a refund of the finance charges to all of the named plaintiffs and all of the class members. UCLC did not respond to this request, and the plaintiffs' attorney filed an affidavit on January 12, 1996, stating that "therefore, more than four (4) months have passed since the written demand, and Defendant UCLC has declined within a reasonable time after written demand to refund the finance charges." On January 9, 1996, the circuit court certified the action as a class action, pursuant to Rule 23(b)(3), Ala. R. Civ. P.
On January 12, 1996, the plaintiffs filed a motion for a partial summary judgment, based on the circuit court's holding in a similar case that UCLC was not exempt from the provisions of the Mini-Code. On January 17, UCLC opposed that motion and sought a stay of a ruling on it until an interlocutory appeal from that holding in that other case was decided by this Court. On February 26, the circuit court granted the requested stay. The appeal in question was *620 decided on October 11, 1996. United Companies Lending Corp. v. McGehee, 686 So. 2d 1171 (Ala.1996). This Court affirmed the holding that UCLC is not exempt from the Mini-Code. The Supreme Court of the United States denied certiorari review. 520 U.S. 1197, 117 S. Ct. 1555, 137 L. Ed. 2d 703 (1997).
Meanwhile, on May 20, 1996, the Governor approved Act No. 96-576. That Act revised several sections of the Mini-Code, including § 5-19-19, which it completely rewrote. That section now reads, in pertinent part:
Section 4 of Act No. 96-576 reads:
The amendment substantially reduces the damages that may be recovered from a creditor charging an excess finance charge.
The plaintiffs filed a motion to have the amendments to § 5-19-19 declared unconstitutional to the extent that they would apply to this pending action. The attorney general was properly served, as provided for in § 6-6-227, Ala.Code 1975. On May 28, 1997, after proceedings on this motion, the circuit court granted it.
In its appeal, UCLC argues first that the plaintiffs do not have a cause of action under § 5-19-19 at all, because the remedy for the wrongs alleged comes, UCLC says, not from § 5-19-19 but from § 5-19-11. Section 5-19-11(b), as amended by Act No. 90-384, 1990 Ala. Acts p. 526,[1] provided:
(Emphasis added.) Thus, § 5-19-11(b) was a catchall or residual remedy for violations as to which no specific remedy was otherwise provided in the Mini-Code. UCLC argues that § 5-19-19 did not provide a remedy for the wrongs alleged by the plaintiffs because the charging of points in excess of 5% is not the charging of an excess finance charge, citing Williams v. E.F. Hutton Mortgage Corp., 555 So. 2d 158 (Ala.1989).
Three simple propositions demonstrate that § 5-19-19 provides a cause of action for a violation of § 5-19-4(g): (1.) Points are a "finance charge":
§ 5-19-1 (emphasis added).[2] (2.) Points may not exceed 5%. § 5-19-4(g). (3.) Section 5-19-19 provides the amount a debtor may recover from a creditor who charges a finance charge that exceeds the amount allowed by the Mini-Code, which includes all of chapter 19 of title 5, Ala.Code 1975.
UCLC relies on the last sentence of the definition in § 5-19-1(1) for its argument that a claim based on a violation of § 5-19-4(g) is not within the terms of § 5-19-19. However, that sentence simply allows points to be "spread over the stated term of the loan" for "the purpose of determining the permissible finance charge." This applies to the "maximum finance charge" provided by § 5-19-3(a), but not to the limitation on points in § 5-19-4(g), because the "spread[ing] [of the 5% points limitation] over the stated term of the loan" would have no effect. Section 5-19-3(a)'s maximum finance charge is expressed as a certain amount per year. As to § 5-19-3(a)'s maximum finance charge, a prepaid finance charge such as points could cause a greatly inflated finance charge in the first year if the points were not "spread over the stated term of the loan." However, that problem has no bearing on the flat prohibition against charging points in excess of 5%. In short, a charge for points in excess of 5% is an excess finance charge within the meaning of § 5-19-19, and the language at the end of § 5-19-1(1) does not affect this fact.
The circuit court held that retroactive application of the amendments to § 5-19-19 would violate §§ 22 and 95 of the Constitution by impairing the obligations of the contracts evidenced by the notes and mortgages between the plaintiffs and UCLC and by "destroying or impairing the remedy for their enforcement," § 95. The court held that § 5-19-4(g)'s prohibition of points in excess of 5% and § 5-19-19's original provisions for damages to be awarded for making an excess finance charge were part of the obligations of the contracts, by operation of law.
Barber Pure Milk Co. v. Alabama State Milk Control Bd., 275 Ala. 489, 494, 156 So. 2d 351, *622 355 (1963). As Justice Houston correctly held in Ex parte Brannon, 683 So. 2d 994 (Ala.1996):
683 So. 2d at 996. Each of the plaintiffs' promissory notes stated, "I agree that this Note and loan are to be governed under Alabama law."
UCLC responds by arguing that the damages recoverable under the original § 5-19-19 constitute a penalty and that the legislature can remit a penalty before it is enforced. It says that this principle, too, should be considered as incorporated into the contracts. However, we hold that the plaintiffs' right to recover damages under 5-19-19 was part of the obligations of the contracts, within the meaning of §§ 22 and 95 of the Constitution, and was the "remedy for their enforcement," within the meaning of § 95. Furthermore, their right of recovery had vested, within the meaning of § 13 of the Constitution, and any attempt to reduce the damages recoverable in this action would violate the last sentence of § 95, which states: "After suit has been commenced on any cause of action, the legislature shall have no power to take away such cause of action, or destroy any existing defense to such suit."
As to UCLC's argument that the damages are merely a penalty that the legislature could constitutionally remit, rather than a vested right for which the plaintiffs had a cause of action, and, for that matter, a pending action, the cases relied upon do not support a retroactive application of this amendment to these plaintiffs.
In City of Mobile v. Merchants National Bank of Mobile, 250 Ala. 159, 33 So. 2d 457 (1948), this Court held that the rate of interest applicable to redemption could be reduced after the execution of the debt and the security instruments that were later foreclosed. The Court held that the reduction in that rate was not an impairment of the obligations of the contracts. This holding was based on a conclusion that so much of the interest rate that exceeded the legal interest rate, 6%, was a penalty and could be remitted by the legislature.
However, the reduction in the interest rate took place before the debt was in default, before the foreclosure, and before the redemption. Absent a default and a foreclosure, there is no question of a redemption, much less the interest to be paid upon a redemption. Thus, as to the parties in City of Mobile, there was no injury, no obligation of contract to be impaired, and no vested right affected when the legislature decreased the interest rate to be paid upon redemption. The Court held that the legislature could constitutionally reduce the interest rate for a redemption before the bonds were foreclosed. City of Mobile simply does not present a question of a reduction in an amount recoverable by a plaintiff after the plaintiff's right to recover that amount has accrued and after the plaintiff has filed an action for damages based on that accrued right.
Another case that figures prominently in the law cited by UCLC is distinguishable in the same way as City of Mobile. In Ewell v. Daggs, 108 U.S. 143, 2 S. Ct. 408, 27 L. Ed. 682 (1883), the Supreme Court of the United States held that a repeal of the Texas usury laws by an adoption of a new constitution for the State of Texas applied so as to defeat a defense of usury as to a contract entered into before the adoption of that constitution. However, the question there was the application of Art. I, § 10, U.S. Const., not the constitutional provisions at issue here. "[T]he decisions of the Supreme Court... cannot exert any controlling influence upon the courts of the several states when those courts are proceeding according to their own practice, and within the constitutional limits of their own State Constitution; no federal question being involved." Kraas *623 v. American Bakeries Co., 231 Ala. 278, 282, 164 So. 565, 568 (1935).
Moreover, Ewell v. Daggs is further distinguishable because of the Court's decision not to apply a Texas case cited by the appellant:
108 U.S. at 151, 2 S. Ct. 408 (emphasis added). It is understandable that Ewell relied on Smith v. Glanton, 39 Tex. 365 (1873), because the report of that case includes the statement, appearing as headnote 1 of the reporter's summary, that "The Constitution repealing usury laws did not legalize usurious contracts of date prior to its adoption." 39 Tex. at 365. The opinion of the Supreme Court of Texas does not, however, unambiguously support that statement, so it cannot be said that the Supreme Court of the United States, in disregarding that reporter's headnote, refused to follow Texas law that would have decided the case in Ewell's favor. However, the Smith v. Glanton opinion squarely holds that the adoption of the 1870 Texas constitution did not affect usury defenses in actions filed before the adoption of that constitution. The trial court had denied a plea "that usurious interest was contracted for and paid by [the defendants] in an amount sufficient to extinguish the note." 39 Tex. at 366. The Supreme Court of Texas reversed a judgment for the plaintiff, holding that the usury defense should have been allowed:
Smith v. Glanton, 39 Tex. at 366.
The statements relied upon by UCLC from Ewell and City of Mobile, therefore, are not so broadly applicable as to support a retroactive application of the amendment to § 5-19-19. The same is true of the other cases relied upon by UCLC. City of Mobile v. Merchants National Bank, supra, includes the following statement:
250 Ala. at 163, 33 So. 2d at 460. As we have shown above, there was no vested right in City of Mobile to recover the former interest rate that the Court held to be a penalty, because that rate had been reduced before the bonds had gone into default. Similarly, the cases of this Court that are cited in the quotation above were cases in which the *624 plaintiff sued not based on an injury, but only on a statute that imposed a penalty that was not contingent upon the plaintiff's having suffered an injury.
In Pope v. Lewis, 4 Ala. 487, 488 (1842), Lewis filed a qui tam action against Pope "for selling rope and bagging without inspection." Lewis was spoken of as "a common informer." Id. Broughton v. Branch Bank at Mobile, 17 Ala. 828 (1850), was an action against a sheriff to recover a penalty for failure to return an execution within the time allowed by law. An 1848 statute was held to have repealed any right to recover the penalty. Owen v. Peebles, 42 Ala. 338, 339 (1868), was "a proceeding for the settlement of the accounts of a deceased guardian by his executor." The ward sought to disallow a credit to the guardian's account of an amount of the ward's money that was invested in Confederate bonds. An 1861 statute authorized such an investment by a guardian, but required the guardian to make a report of the investment to the proper court. If the guardian failed to make the report or to show good cause for not making the report, the statute disallowed a credit to the guardian for this use of the ward's funds. The Court allowed retroactive application of an 1866 act that repealed the penalty for failing to make the report if the ward was not injured thereby, but held that, if the ward could show that he had been injured, he was entitled to recover for his injury.
Thus, the proposition that the legislature may remit a penalty cannot constitutionally apply when a person has suffered a legal injury and has a cause of action for the recovery of damages based on that injury. Both § 13 and § 95 of the Constitution of 1901 prohibit the legislature from taking away a vested right § 13 does so regardless of whether an action has been brought upon the right, and § 95 does so after "suit has been commenced," i.e., after an action has been filed.
Pickett v. Matthews, 238 Ala. 542, 545, 192 So. 261, 263 (1939) (emphasis added).
When the notes and mortgages in question were made and given, § 5-19-4(g) prohibited a creditor from charging points in excess of 5%. Nevertheless, UCLC did so in the notes executed by the members of the plaintiff class. The obligations under those notes are governed by the prohibition in 5-19-4(g) of points in excess of 5% and by the provision in the original § 5-19-19 that in the case of an excess finance charge a debtor can recover the entire finance charge or the greater amounts specified therein for the higher degrees of wrongful conduct described. The plaintiffs suffered a legal injury when UCLC charged the excess points.
We affirm the order of the trial court. The obligations of the plaintiffs' contracts were determined in 1991, when they made the notes and gave the mortgages to UCLC. Those obligations included the law, as stated in § 5-19-4(g), that a creditor was prohibited from charging points in excess of 5% and, in the original § 5-19-19, that a creditor charging an excess finance charge was required to return the finance charge or a higher amount as specified therein. The plaintiffs filed their action in April 1994, they made specific written demands in September 1995 for return of the finance charge, and their action was certified as a class action in January 1996. Section 5-19-19 was not amended until May 1996. A retroactive change in § 5-19-19 would impair the obligations of the plaintiffs' contracts, in violation of §§ 22 and 95 of the Constitution of Alabama of 1901; it would destroy vested rights, in violation of § 13 of the Constitution; and it would take away the plaintiffs' cause of action, in violation of § 95 of the Constitution.
AFFIRMED.
*625 ALMON, SHORES, and COOK, JJ., concur.
HOUSTON, J., concurs in the result.
HOOPER, C.J., and MADDOX and SEE, JJ., dissent.
LYONS, J., recuses himself.
HOUSTON, Justice (concurring in the result).
I am on the horns of a dilemma! I can dissent and allow a Special Justice to decide this case, or I can concur in the result and satisfy myself that this decision will not jeopardize the fundamental law of Alabama.
I adhere to the views I expressed in my dissent in United Companies Lending Corp. v. McGehee, 686 So. 2d 1171, 1179-83 (Ala. 1996), and my special writing in Ex parte Watley, 708 So. 2d 890, 898-99 (Ala.1997); and I fervently believe 1) that United Companies Lending Corporation is an approved mortgagee under the provisions of the National Housing Act and that it is exempt under Ala.Code 1975, § 5-19-31, from the provisions of Alabama's Mini-Code; and 2) that Ala.Code 1975, § 5-19-4, did not amend § 8-8-5. However, this Court has held otherwise. If I continue to dissent, by disregarding the doctrine of stare decisis, there will be a 4-4 division on this Court, and it will be necessary for the appointing authority to appoint a Special Justice to cast the deciding vote in this case. In my opinion, a Special Justice should be and would be bound by this Court's decisions in McGehee and Watley. Following the doctrine of stare decisis, I concur in the result, for the following reasons.
I am persuaded that some of the statements of law in Justice Kennedy's writing in this case are erroneous, even if the holdings in McGehee and Watley are the law. If I dissented to the opinion as a whole, and a Special Justice was appointed, then these erroneous statements might also become holdings of this Court. To keep this from happening, I concur in the result.
I am satisfied that the 1996 amendments to the Mini-Code did not violate Article I, § 13, of the Alabama Constitution of 1901. See Tyson v. Johns-Manville Sales Corp., 399 So. 2d 263, 269 (Ala.1981), and State Board of Optometry v. Lee Optical Co., 284 Ala. 562, 226 So. 2d 623 (1969). Justice Kennedy's conclusion to the contrary causes me to fear that the specter of Grantham v. Denke, 359 So. 2d 785 (Ala.1978), may be returning to deprive the Alabama legislature of its constitutional right to make and to change the law. In his dissent in Fireman's Fund American Ins. Co. v. Coleman, 394 So. 2d 334, 355-58 (Ala.1980), Justice Beatty exposed the fallacy upon which Grantham was based, and in my opinion in Reed v. Brunson, 527 So. 2d 102 (Ala.1988), I forcefully demonstrated why the holding in Grantham should never have been the law. I do not want the holding in Grantham reestablished as the law in Alabama. I am also satisfied that the 1996 amendments did not violate Article I, § 22, of the Constitution. See Ewell v. Daggs, 108 U.S. 143, 150-51, 2 S. Ct. 408, 27 L. Ed. 682 (1883), and Reynolds v. Lee, 180 Ala. 76, 60 So. 101 (1912). I dissent as to Justice Kennedy's statements with respect to these issues (i.e., his statements that applying the 1996 amendments to § 5-19-19 to these plaintiffs' claims would violate § 13 and § 22), so that those statements do not become holdings of this Court.
The plaintiffs commenced this action before the legislature amended the Mini-Code in May 1996. The legislature's otherwise permissible retroactive remission of the statutory penalty set out in § 5-19-19, see City of Mobile v. Merchants National Bank of Mobile, 250 Ala. 159, 163, 33 So. 2d 457, 460 (1948), cannot pass constitutional muster in this particular case, because the legislature amended § 5-19-19 after the plaintiffs had filed this action. Article IV, § 95, of the Constitution provides: "After suit has been commenced on any cause of action, the legislature shall have no power to take away such cause of action...." A "cause of action" is defined in Black's Law Dictionary (6th ed.1990) as "[a] situation or state of facts which would entitle [a] party to sustain [an] action and give him [the] right to seek a judicial remedy in his behalf." When they filed this action, the plaintiffs had a particular remedy under § 5-19-19. That remedy included the right to collect a penalty for a lender's making an excessive finance charge. *626 By amending § 5-19-19 and reducing the penalty portion of the plaintiffs' statutory remedy, the legislature impermissibly impinged upon the plaintiffs' cause of action. The last sentence in § 95, which is clear on its face, provides a "safe harbor" for these particular plaintiffs.
I do not reach the question of what the plaintiffs are entitled to under § 5-19-19 as it read before the 1996 amendment.
I concur in the result only.
HOOPER, Chief Justice (dissenting).
There is one point that would moot the entire question in this case. The Mini-Code does not apply to real estate loans over $2,000 in value. Section 8-8-5, Ala.Code 1975, applies. See my special writing in Ex parte Watley, 708 So. 2d 890 (Ala.1997) (Hooper, C.J., concurring in the result). United Companies Lending Corporation ("UCLC") should not be liable at all under § 5-19-4(g). The market determines when points are excessive. I believe that is why the legislature reduced the maximum amount of the loans subject to Mini-Code treatment from $100,000 to $2,000. The loan to the named plaintiffs in this case was far above $2,000; therefore, the Mini-Code does not apply.
However, the problems in the lead opinion do not end with the misapplication of the Mini-Code. If I were to accept the application of § 5-19-19 to UCLC in this case, I would still dissent. The damages in this case could potentially include the forfeiture of principal the plaintiffs borrowed from UCLC. I question why UCLC should be held to have been aware of the requirement that it not charge more than 5% in points. In United Companies Lending Corp. v. McGehee, 686 So. 2d 1171 (Ala.1996), this very Court was unable to determine whether United was under such a restriction until it was reviewing the case on rehearing. This Court's first opinion in that case had stated that, based on federal law, United was not bound to that requirement.
The lead opinion has also turned the "impairment of contracts" clause of the constitution on its head. In this case, the plaintiffs made an agreement with UCLC. The constitution should protect that agreement from interference by the civil government. Not in this case. The lead opinion interprets § 95 of the constitution in this way: The statute giving the plaintiffs the right to recover principal and interest from a company that charges more than 5% as points is incorporated into the contract between UCLC and the plaintiffs; any change in the damages that can be awarded to the plaintiffs is an impairment of that contract. Never mind that § 95 mentions nothing about the damages that can be awarded. It reads in part: "There can be no law of this state impairing the obligation of contracts by destroying or impairing the remedy for their enforcement...." The change in the damages portion of the particular statute in question does not impair or destroy the remedy of the enforcement of the contract between the plaintiffs and UCLC. The remedy is to refund any excess points charged. The amended statute does not impair that remedy.
Section 5-19-19, as it read before May 20, 1996, established the condition for a plaintiff to recover the principal of a loan: "If the creditor has made an excess finance charge in deliberate violation of or in reckless disregard for this chapter, the creditor shall have no right to receive or retain the principal or any finance charge whatsoever and the transaction shall be void." Even taking § 5-19-19 as it read before May 20, 1996, how can this Court, which came to the "right" conclusion in McGehee, only after two attempts, conclude that UCLC's act of charging 8% and not refunding the interest is "reckless?" Was this Court's original opinion in McGehee "reckless?" Such decisions truly call for the public's ire against what appears to be hypocrisy on the part of the judiciary. I know of nothing more destructive of justice than to call a party's acting lawfully and legitimately to defend its rights a deliberate disregard for the law and therefore worthy of punishment. UCLC, just like this Court, did not know that the Mini-Code applied the 5% limit to its business. If, at the time UCLC entered into this agreement with the plaintiffs, this Court did not know and had not issued an opinion indicating that a lender such as UCLC could not charge over 5%, how is UCLC to be charged with reckless or intentional conduct?
This discussion leads to the issues presented in BMW of North America, Inc. v. Gore, *627 517 U.S. 559, 116 S. Ct. 1589, 134 L. Ed. 2d 809 (1996). One of the three "guideposts" the United States Supreme Court set up in that case for determining a constitutional award of punitive damages was "reprehensibility." Without notice that a particular action could result in liability, a defendant cannot be held liable for engaging in that activity. That is why the trial court in BMW could not hold the defendant BMW liable for actions it had taken in other states where its conduct was not considered tortious. That analysis also bears on the question of UCLC's reprehensibility in this case. Because UCLC did not have notice that it was subject to the 5% limit, the reprehensibility element, so necessary for punishing a defendant, is lacking in this case.
The lead opinion justifies the heavy penalty because the penalty is based on a statute. However, in Gore the United States Supreme Court placed no such condition on its analysis of a punitive award. Just because the punishment is imposed by statute does not mean that this Court should not decide how reprehensible, and, therefore, how deserving of punishment UCLC may be in this case. If UCLC had notice that its act of charging 8% would subject it to liability, then I might be inclined to agree that a statutory penalty of this magnitude would be justified. But UCLC did not have notice. The judgment in this case is akin to an ex post facto punishment. The defendant is being punished for conduct that even this State's highest court did not know was punishable with respect to this class of defendants. The similarity to BMW in this respect is striking.
I make these observations because I am concerned about the just application of § 5-19-4. I hope that on remand these comments will be shown to have been academic. The trial judge will supervise the final award of any damages and the appropriateness of the amount of that award.
For these reasons, I dissent.
MADDOX, J., concurs.
[1] Section 5 of Act No. 96-576 provides: "The provisions of Section 5-19-11(b) are transferred to, and restated and amended in, Section 5-19-19(c). The remainder of Section 5-19-11 is repealed." Act No. 96-576 does not purport to make its transfer, amendment, and repeal of the provisions of § 5-19-11 retroactive.
[2] We have quoted § 5-19-1(1) as it read before it was amended by Act No. 96-576. That Act did not purport to make its amendment to this section retroactive.
[3] This is the usury statute cited in Ewell, and the earlier cited section of the constitution is the one cited in Ewell. | bceb398f1a21c2984b3680683f616d2fa789323c275deff5680961b1447695e7 | 1998-08-14 00:00:00 |
07dbffdb-96a8-454c-8694-5a7f85315b4e | Ex Parte Conway | 720 So. 2d 889 | 1960770 | Alabama | Alabama Supreme Court | 720 So. 2d 889 (1998)
Ex parte James Hugh CONWAY.
(Re James Hugh CONWAY v. STATE of Alabama ex rel. DEPARTMENT OF HUMAN RESOURCES on Behalf of Denise BRANNON).
1960770.
Supreme Court of Alabama.
July 31, 1998.
Joseph McNamee Tucker, Lafayette, for petitioner.
J. Coleman Campbell and Lois Brasfield, asst. attys. gen., Department of Human Resources, for respondent.
SEE, Justice.
The Court of Civil Appeals affirmed the judgment of the trial court in this paternity case without an opinion. Conway v. State ex rel. Department of Human Resources, 696 So. 2d 1091 (Ala.1996) (table). In light of Ex parte Jenkins, [Ms. 1961520, July 17, 1998] ___ So.2d ___ (Ala.1998), we quash the writ as improvidently granted. We express no opinion as to whether the petitioner would be entitled to relief under Rule 60(b)(6), Ala. R. Civ. P., as that rule was interpreted in Jenkins, *890 because the petitioner has yet to make a Rule 60(b)(6) motion to the trial court.
WRIT QUASHED.
HOOPER, C.J., and ALMON, SHORES, HOUSTON, KENNEDY, and LYONS, JJ., concur.
COOK, J., concurs in the result.
MADDOX, J., dissents.
COOK, Justice (concurring in the result).
This case presents issues similar to those recently addressed by this Court in Ex parte Jenkins, [Ms. 1961520, July 17, 1998] ___ So.2d ___ (Ala.1998). Although I dissented from that part of the Jenkins opinion holding that § 26-17A-1, Ala.Code 1975, could not be applied to judgments that became final before the adoption of that statute, I concur in the result in this case. The evidence presented does not establish that the trial court abused its discretion in denying the petitioner's motion for a blood test. When the petitioner moved for a blood test, he did not present scientific evidence to rebut the adjudication of paternity.
MADDOX, Justice (dissenting).
James Hugh Conway challenges a paternity judgment that was entered in 1981, before the Legislature adopted § 26-17A-1, Ala. Code 1975, which authorizes the reopening of such a judgment when certain facts can be shown. The majority quashes the writ as having been improvidently granted, relying on the reasoning applied in Ex parte Jenkins, [Ms. 1961520, July 17, 1998] ___ So.2d ___ (Ala.1998), a case in which I concurred in part, concurred in the result in part, and dissented in part. I specifically disagreed with the holding that the Legislature could not permit the reopening of a paternity judgment, such as the one involved in this case, that was entered before the effective date of § 26-17A-1.
I cannot agree with the result reached in this present case because the trial court and the Court of Civil Appeals have refused to permit a man adjudicated to be the father of a child to receive the benefits of a Code section that was adopted precisely for men like him. In my opinion, one of the primary reasons the Legislature adopted § 26-17A-1 in the first place was to relieve a man adjudicated to be the father of a child from the obligation to support the child if he can prove, by scientific evidence, that he is not the father.[1]
Because this case involves the same basic legal issue as Jenkins, I could simply dissent in this case and refer to the dissenting views I expressed in Jenkins. However, this case specifically presents the situation that led me to disagree in Jenkins, that is, a situation in which a man is required to pay child support under a threat of a finding of contempt of court, even though the Legislature has stated that he should be able to have the trial court reopen the original judgment upon which the order to pay support is based. Accordingly, I elect to further explain why I must respectfully disagree with other members of the Court on the separation-of-powers question that was discussed in Jenkins and that is also presented in this case. In essence, I believe that a legislature that has the power to impose an obligation upon a man to pay child support certainly can authorize the removal of that obligation if the man shows that the judgment on which the obligation is based was procured by what could be described as a legal fraud practiced upon the court when the paternity adjudication was initially made. Cf. Hartigan v. Hartigan 272 Ala. 67, 128 So. 2d 725 (1961) (decree of divorce could be set aside upon a showing that a fraud was committed upon the court to obtain jurisdiction); *891 Stone v. Gulf American Fire & Casualty Co., 554 So. 2d 346 (Ala.1989) (a judgment relating to a decedent's estate was reopened to allow an illegitimate child to show that a legal fraud was committed by personal representatives of the estate by withholding from the court evidence that the decedent was in fact her father and that he had acknowledged that fact); Duncan v. Johnson, 338 So. 2d 1243 (Ala.1976) (remaindermen could attack a 20-year-old decree ordering the sale of land and a division of the proceeds, where the decree ordering the sale and division was procured on the basis of fraudulent representations by the owner of the life estate, who was the purchaser at the sale).
In this case, the Court, by quashing the writ, gives effect to a trial judge's refusal to reopen a judgment involving the same issue, the same legislative act, and substantially similar facts as Jenkins. By refusing to permit the proceeding to go forward under § 26-17A-1, the Court necessarily seems to create a jurisprudence that allows trial judges to determine on a case-by-case basis which paternity judgments will be reopened and which will remain closed. I would not permit this type of inconsistency, but would instead apply the provisions of the legislative act, which authorizes any man adjudicated to be the father of a child to have the paternity judgment reopened in every case in which he can show the evidence specified in the act.
The facts are undisputed. James Hugh Conway and Denise Brannon were divorced in 1981. While they were married, Denise gave birth to three children. The divorce judgment ordered Conway to pay child support for the three children. At the time of the divorce proceedings, Conway did not challenge his paternity of any of the three children, and he did not in those proceedings challenge the order to pay child support. In 1989, the court granted a joint petition for modification of the custody order, placing the oldest child with Conway and the other two children with Denise. Again, Conway did not at that time challenge his paternity of any of the children.
Subsequently, Conway defaulted on his child support obligations, and in 1995 the State of Alabama, on Denise's behalf, filed a "Contempt Petition for Nonpayment of Support." For the first time, Conway, in his answer, stated that he did not believe he was the father of the two younger children, specifically asserting that § 26-17A-1, which had been enacted in 1994, allowed him to introduce scientific evidence to challenge his paternity. He asked the trial court to order blood tests, but the trial court refused that request and, instead, ordered Conway to pay the child support arrearage. The Court of Civil Appeals affirmed, without an opinion. Conway v. State ex rel. Department of Human Resources, 696 So. 2d 1091 (Ala.Civ.App. 1996) (table).
In support of his petition for certiorari review of the Court of Civil Appeals' judgment, Conway argued that § 26-17A-1 allowed him to challenge paternity at any time, regardless of whether he had previously had the opportunity to challenge it. The State argues, among other things, that § 26-17A-1 applies only to allow a man who was a "defendant" in a prior "paternity proceeding" to "reopen" that proceeding, and the State argues that a contempt proceeding based on the 1981 divorce judgment is not a "paternity proceeding." Even Jenkins refutes the State's argument on this point; it clearly recognizes that the provisions of § 26-17A-1 are broad enough to reach paternity determinations contained in divorce judgments.[2] See Ex parte Jenkins, ___ So.2d at ___.
The determinative question is whether the trial judge was required, by the provisions of § 26-17A-1, to reopen the judgment.[3] The majority upholds the trial court's dismissal of Conway's claim. I think the majority errs, because I believe the trial judge was required *892 to allow Conway to present scientific evidence to prove that he was not the father of the two children. The Legislature specifically used the word "shall" when it adopted the statute.
On the ultimate issue of allowing the judgment to be reopened, the trial court and the Court of Civil Appeals concluded that § 26-17A-1 did not require the trial court to reopen the paternity judgment. In quashing the writ, a majority of this Court apparently concludes that the trial judge had no obligation under § 26-17A-1 to reopen the prior judgment; implicit in that conclusion is a reaffirmation of the holding in Jenkins that the Legislature was without power to mandate the reopening of a paternity judgment entered before the effective date of § 26-17A-1. See Jenkins, ___ So.2d at ___. My views of the separation-of-powers principle are simply different from those of the majority.
As I explained in my dissenting opinion in Jenkins, addressing the separation-of-powers issue, I agree that there are some judgments that the Legislature cannot require courts to reopen, and, as I stated there, I do not think the Legislature intended to affect any rights that have become vested before the person adjudicated to be the father seeks to reopen the paternity judgment. In other words, I do not believe the Legislature intended that a party who has received benefits under a judgment of paternity would be, or should be, required to return those benefits. Clearly, however, one adjudicated to be the father should be allowed to show that he should no longer be bound by the judgment, if he can show, by scientific evidence, that the judgment was based not on fact but on a species of legal fraud. Cf. Stone, supra, where this Court permitted an illegitimate child of the late Hank Williams to show that a species of legal fraud had been practiced upon her.
As I stated in Jenkins, the field of family relationships involves duties of support and issues of heirship, and I believe the Legislature has the constitutional power to require the reopening of paternity judgments to prevent a person, who can show by scientific evidence that he is not the father of a child, from having a legal obligation to support that child. Clearly, he should not suffer a loss of liberty by being held in contempt of court for his failure to pay support from the date he files his petition seeking the benefits of § 26-17A-1. Stated differently, I do not believe that the Legislature is powerless to prevent such an egregious wrong, especially when the judgment is based on supposed facts that can be scientifically proven to be untrue. With the development of scientific testing, facts that were once unknown can now be known. Our society is more and more frequently using DNA analysis to prove heretofore unknown or disputed facts.[4]
I am a great believer in the basic power of courts to declare finally the rights of the parties in a particular case or controversy, and I agree that there are cases where courts should use their power to declare a legislative act unconstitutional because of a violation of the separation-of-powers doctrine. However, I believe just as strongly that the Legislature has the power to say that a man should not have to suffer the possible loss of his liberty or property if he fails to support a child that he can show, by scientific evidence, is not his.
The Department of Human Resources, on behalf of the mother, has strongly urged that Conway be required to continue to support two children that he says he can show, by scientific evidence, are not his. I can appreciate the Department's desire to find someone to support the children, but it is my considered judgment that the people of this State, through their elected representatives, have provided for the reopening of the judgment in this case, and that the Department's desires should be subservient to the will of the people as it has been expressed by the Legislature in § 26-17A-1.
Although I realize that the order quashing the writ is not necessarily based on the principle that the children should be provided for *893 even if Conway is not the biological father, I note that the Legislature, being charged with the responsibility of determining how the interests of the children will be protected, has determined that one who can prove he is not the father of a child should not be further required to support that child.[5] I believe the Legislature knew what it was doing when it enacted § 26-17A-1 and that it specifically intended to allow a man in Conway's position to reopen a prior paternity judgment, and I cannot see how the Alabama constitution stands in the way. Consequently, I respectfully dissent.
[1] Section 26-17A-1 provides, in pertinent part:
"(a) Upon petition of the defendant in a paternity proceeding where the defendant has been declared the legal father, the case shall be reopened if there is scientific evidence presented by the defendant that he is not the father. The court shall admit into evidence any scientific test recognized by the court that has been conducted in accordance with established scientific principles or the court may order a blood test, or a Deoxyribose Nucleic Acid test of the mother, father, and child. Whenever the court orders a test and any of the persons to be tested refuse to submit to the test, the fact shall be disclosed at the trial, unless good cause is shown."
(Emphasis added.)
[2] Ala.Code 1975, § 26-17-9(a), provides that paternity actions under the Alabama Uniform Parentage Act may be part of a divorce proceeding.
[3] See the statute, quoted in note 1. The State argues that Conway did not present scientific evidence, but the record clearly shows that the trial judge's denial of relief was not based on a lack of scientific evidence indicating that Conway was not the father. It is undisputed that the trial court refused to allow him to offer scientific evidence.
[4] For example, the United States Government has recently removed the remains of an Air Force pilot from the Tomb of the Unknown Soldier at Arlington Cemetery, after DNA testing made it possible to identify the remains. See Steve Vogel, "Unknown Soldier" is Air Force Pilot, Washington Post, June 30, 1998, at A1.
[5] I can appreciate the position of the Department of Human Resources, which seeks to find a person upon whom to pin the obligation of support, but the Department's argument that the Legislature did not intend to relieve a man adjudicated to be the father of a child from that obligation, it seems to me, is misplaced. | 8c4a7a60048925d177ce8d0af4a5142ab1a0154f398a6b9e5e97c2afd7e5194a | 1998-07-31 00:00:00 |
e015edf0-c6fc-4100-98ce-0acc17b4ae84 | Mutual Sav. Life Ins. Co. v. James River Corp. | 716 So. 2d 1172 | 1961506 | Alabama | Alabama Supreme Court | 716 So. 2d 1172 (1998)
MUTUAL SAVINGS LIFE INSURANCE COMPANY, et al.
v.
JAMES RIVER CORPORATION OF VIRGINIA and Merrill Lynch, Pierce, Fenner & Smith, Inc.
1961506.
Supreme Court of Alabama.
June 19, 1998.
*1174 J. Michael Rediker, Peyton D. Bibb, Jr., and Thomas L. Krebs of Ritchie & Rediker, L.C., Birmingham; and J. Timothy Kyle of Russell, Straub & Kyle, Decatur, for appellants.
Thomas E. Spahn and Thomas McGonigle of McGuire, Woods, Battle & Boothe, L.L.P., Richmond, VA; Michael L. Edwards and Edward S. Allen of Balch & Bingham, Birmingham; and John S. Key of Eyster, Key, Tubb, Weaver & Roth, Decatur, for appellee James River Corp. of Virginia, on original submission.
N. Lee Cooper, Patrick C. Cooper, and Carranza Pryor of Maynard, Cooper & Gale, P.C., Birmingham, for appellee Merrill Lynch & Company, Inc., on original submission.
Thomas E. Spahn and Thomas McGonigle of McGuire, Woods, Battle & Boothe, L.L.P., Richmond, VA; Michael L. Edwards and Edward S. Allen of Balch & Bingham, Birmingham; John S. Key of Eyster, Key, Tubb, Weaver & Roth, Decatur; Patrick C. Cooper of Maynard Cooper, Frierson & Gayle, P.C., Birmingham, for appellees James River Corp. of Virginia and Merrill Lynch & Company, Inc., on application for rehearing.
William T. Stephens, general counsel, Retirement Systems of Alabama, for amicus curiae Retirement Systems of Alabama.
HOOPER, Chief Justice.
The opinion of April 17, 1998, is withdrawn, and the following opinion is substituted therefor.
The plaintiffs in this class action invested in 30-year 10.75% debentures issued by James River Corporation of Virginia. Merrill Lynch, Pierce, Fenner & Smith, Inc., was the dealer-manager for a tender offer made by James River to the bondholders. The tender offer is the subject of this dispute. The plaintiffs are Mutual Savings Life Insurance Company, Transamerica Occidental Insurance Company, and Larry Wasserman. The class includes Protective Life Insurance Company, individual investors; mutual benefit societies; and small institutional investors. The plaintiffs named James River and Merrill Lynch as defendants.
The plaintiffs alleged that James River, with the knowing assistance and active encouragement of Merrill Lynch, wrongfully, fraudulently, and prematurely called, retired and refunded with lower-rate debt its $250,000,000 issue of 10.75% debentures. The company issued these 30-year bonds in 1988, and the tender took place in 1992. James River bought back the tendered bonds with the proceeds of a sale of $200,000,000 in notes at 6.75%. The bonds that were not tendered were redeemed with the proceeds of an issuance of preferred stock. The investors claim that this retiring of the bonds violated a clause in their contract known in the bond market as a "non-refund covenant."
A brief explanation of the financial terminology used in this case will be helpful. The plaintiffs invested in 10.75% debentures, also known as bonds. A contract known as an indenture governs a bond issuance. One of the key provisions of an indenture defines the ability of the issuer to buy back the bond before the latest possible maturity date. The most common way this is done is through a call and redemption. A redemption occurs when the issuer of a bond compels the bondholder to sell back the bond at a specified price. The indenture defines the call price the price at which the redemption takes place.
However, certain limitations exist. The indenture in this case (as in most all indentures) prohibited the issuer from paying for the redeemed bonds with money borrowed at an interest rate lower than that of the *1175 bond10.75% in this case. The issuer must pay for the redeemed bonds with qualified funds (also known as "clean cash"). Thus, the money used to redeem the bonds must be from a qualified source. Callable bonds may be called and redeemed at any time as long as they are paid with qualified funds.
An issuer of bonds also is entitled to make a tender offer at any time for the bonds. Unlike a call and redemption, a tender offer is not governed by the indenture. A company may make a tender offer for noncallable bonds. Because a tender offer is not governed by the indenture, there are no restrictions on the type of funds that an issuer may use to buy back tendered bonds. In other words, an issuer can use lower-rate borrowed money to pay for tendered bonds. Also, when a tender offer is made, the issuer must pay a premium to the bondholder that it would not have to pay if it called the bonds. For example, the call price in this case was $1,086.00 per $1,000 par value, and the tender price was $1,093.75 per $1,000 par value. Therefore, a tender offer is different from a call and redemption.
When a tender offer is made, the bondholder may accept or hold. By holding, the bondholder rejects the tender offer. In this case, James River made a tender offer to buy back its 30-year 10.75% bonds. In the letter notifying bondholders of the tender offer, James River expressed its intention to call any bonds that were not tendered. On the day that the tender offer expired, James River called all of the bonds. Ninety-eight percent of the bondholders accepted the tender offer, while the other 2% of the bondholders chose to have their bonds called. James River paid the bondholders who accepted the tender offer with the proceeds from the sale of $200,000,000 worth of 6.75% medium-term notes. Thus, James River bought back the tendered bonds with money that was borrowed at a rate lower than 10.75%. James River then redeemed the remaining 2% of the bonds. It paid for the redeemed bonds with qualified fundsthe proceeds of the issuance of preferred stock. The investors claim that the process of retiring these bonds violated the redemption clause in the indenture because James River replaced the debt with lower-rate debt.
This case involves the interpretation of one paragraph in the contract between James River and the investors regarding redemption of the bonds. That paragraph reads:
(Emphasis added.) We interpret this paragraph to mean that James River cannot redeem the bonds before the date specified by using money borrowed at a rate lower than the rate at which it had issued the bonds 10.75%.
The plaintiff investors claimed that James River, with the assistance of Merrill Lynch, breached its contract with them by refunding its bonds in violation of the redemption clause. They also made several tort claims based on the defendants' failure to inform them that the company did not have sufficient qualified funds and on James River's failure to fully disclose its plan to retire the bonds. The investors also made a claim under the Trust Indenture Act ("TIA"), which provides a cause of action when an issuer of bonds has defaulted in payments of interest or principal. The investors also made a separate claim against Merrill Lynch alleging tortious interference with a business relation. The trial court certified a class for the breach-of-contract claim. However, the trial court denied class certification on the tort claims because the laws of each investor's home state would control the claims.
The trial court entered a summary judgment for the defendants on the breach-of-contract claim, and it dismissed the tort claims under Rule 12(b)(6), Ala.R.Civ.P. The trial court dismissed the TIA claim because the bondholders had received all of the interest to which they were entitled. Also, the trial court entered a summary judgment for *1176 Merrill Lynch on the tortious-interference claim because that claim was dependent on the breach-of-contract claim, which the trial court disposed of by a summary judgment. The plaintiffs appeal all aspects of the trial court's ruling.
We hold that there was not substantial evidence to counter the defendants' summary judgment motion as to the breach-of-contract claim, the tortious-interference claim, and the TIA (Trust Indenture Act) claim. The trial court properly dismissed the tort claims because the investors did not present a cognizable cause of action. Finally, we conclude that the trial court properly denied class certification as to the tort claims. We affirm the judgment of the trial court.
The investors claimed that James River breached the contract by buying back the bonds with money borrowed at a lower rate than the rate at which it had issued the bonds. The trial court entered a summary judgment for the defendants on this issue. "In reviewing the disposition of a motion for summary judgment, we utilize the same standard as that of the trial court in determining whether the evidence before the court made out a genuine issue of material fact." Bussey v. John Deere Co., 531 So. 2d 860, 862 (Ala. 1988). When the movant makes a prima facie showing that there is no genuine issue of material fact, the burden shifts to the nonmovant to present substantial evidence creating such an issue. Bass v. SouthTrust Bank of Baldwin County, 538 So. 2d 794 (Ala. 1989). "[S]ubstantial evidence is evidence of such weight and quality that fair-minded persons in the exercise of impartial judgment can reasonably infer the existence of the fact sought to be proved." West v. Founders Life Assurance Co. of Florida, 547 So. 2d 870, 871 (Ala.1989). On a motion for summary judgment, this court must review the record in a light most favorable to the nonmovant and must resolve all reasonable doubts against the movant. Hanners v. Balfour Guthrie, Inc., 564 So. 2d 412 (Ala.1990).
The investors argue that the defendants breached the contract in order to save James River several million dollars per year in interest payments. They argue that the tender offer was, in effect, a redemption. They claim that the sole purpose for making the tender offer was to refund the bonds, i.e., James River wanted to replace higher-rate debt with lower-rate debt. The investors claim that such a refunding violated the indenture because James River bought back the tendered bonds with money borrowed at a rate less than 10.75%.
The investors also claim that the defendants participated in what has become known as a "simultaneous tender and call" (STAC). They claim that James River, in essence, made its tender offer at the same time that it called the bonds. Because it did so, the investors claim, they were coerced into accepting the tender offer. They argue that this would allow James River to obtain a better rate than it would have received had it bought back the bonds at the call price. They argue that James River accomplished the tender/call so that it could retire the bonds without having to comply with the redemption clause. This is the case because tendered bonds can be bought back with money borrowed at a lower rate than the issue rate. The investors claim that they were faced with the "threat" of accepting the tender offer (with only a slightly higher premium than the call price) or being forced to sell back their bonds at the call price. The investors' major objection to the STAC process is that it is coercive. In a simultaneous tender and call situation, they argue, the investor, knowing the bonds will be redeemed in the call anyway, effectively has no choice but to accept the tender offer.
The trial court determined that the tender offer made by James River must be considered separately from the call. Therefore, the trial court found that the tender and call were not simultaneous. We agree with the trial court. It is first necessary to determine whether the tender offer was distinguishable from a call. The trial court set out a three-part test for making this determination:
The trial court determined that the offer made by James River was a tender offer rather than a call. We agree. There was a premium over the call price for tendering the bonds. Also, James River employed Merrill Lynch to assist it in soliciting acceptances of the offer. Finally, the tender offer was not binding and the bondholders did not have to accept it. In its letter announcing the offer, James River stated:
Thus, the decision to accept the offer was voluntary. We find no error in the trial judge's holding that the offer was a tender offer. Thus, we conclude that James River did not violate the terms of the contract, because the tender offer was not subject to the indenture and, therefore, was not subject to the limitation regarding the use of money borrowed at a lower rate. The trial judge correctly stated: "Since the non-refund covenant does not apply to tender offers, James River's use of lower interest cost debt proceeds to purchase the debentures is an immaterial fact."
The restrictions in the indenture regarding the lower-rate borrowed money apply only to redemptions. The trial judge correctly referred to the fact that the indenture did not broadly define "redeem" to encompass a tender offer or other mode of acquisition. The indenture also failed to mention any limitations on the use of a tender offer to buy back the bonds. The trial judge stated, "Tender offers for nonrefundable debentures clearly appear repugnant to the broad purpose underlying the non-refund covenant. Nonetheless, the Court must give meaning to the express terms set forth in the redemption provisions of the contract documents." If the investors had intended to restrict the use of tender offers to retire the bonds, then they should have included in the indenture a provision that would do that.
The next question we must address is whether the tender and the call were simultaneously made in order to coerce the investors to accept the tender offer. We hold that the trial court correctly determined that the tender and the call should be considered separately. First, we note that the investors took the risk that their bonds would be called at any time, by buying callable bonds. They could have purchased noncallable bonds (at a lower interest rate) if they wanted long-term certainty in their investment. Coercion is a contracted-for element (inherent in the indenture) of a redemption of callable bonds. The issuer has the right to call the bonds at any time. Also, in this case, the tender was a separate voluntary transaction that the investors did not have to accept. The investors could have exercised their right to hold the bonds. In fact, one of the plaintiffs, Larry Wasserman, did not accept the tender offer. He chose to wait for the call and redemption.
At worst, the combined tender offer/redemption notice was designed to exert legitimate economic pressure on most of the debenture holders, who would logically choose to receive the higher tender price instead of the lower redemption price. James River could have called all the bonds without making a tender offer. The tender offer, which resulted in a slightly higher rate of return than the redemption, offered a benefit to the bondholders above that offered in the redemption. The exertion of such economic pressure did not violate the express terms of the indenture. James River's exercise of its ability to effect a mandatory redemption with the proceeds of a preferred stock issuance did not violate the indenture. Thus, James *1178 River could, pursuant to the indenture, make a tender offer with borrowed funds followed by a mandatory redemption with the preferred stock proceeds. To the extent debenture holders are dissatisfied with such an arrangement, they should require issuers to prohibit such arrangements in future indentures.
Because we conclude that the tender offer was separate from the call, the only remaining question is whether James River used qualified funds to buy back the redeemed bonds (2% of the bonds). It is undisputed that James River paid for the redeemed bonds with the proceeds of the issuance of preferred stocka qualified source for the money. The plaintiffs argue that the practical effect of the proffered tender (with an announced future call) produced the same result that would have occurred if James River had simply called all the bonds by using the lower rate debt. However, that result-focused argument ignores the fundamental difference between a tender and a call. The language of the indenture clearly indicates that the non-refund covenant refers to an involuntary call and redemption. The tender offer was a separate transaction that 98% of the investors voluntarily accepted.
The investors contend that the language of the indenture stating that no redemption could be made "directly or indirectly, in whole or in part," with unqualified funds requires the Court to apply an "underlying economic reality" test. The investors cite Shenandoah Life Ins. Co. v. Valero Energy Corp., (No. 9032, June 21, 1988) 14 Del. J. Corp. L. 396 (Del. Ch.1988) (not published in Atlantic Reporter), in which similar language was at issue, and they ask this Court to focus on the final result of the complete transaction. The investors urge that, under Shenandoah, if it is found that the redemption of the bonds, albeit lawfully made with qualified funds, would not have occurred but for a tender for other bonds using unqualified funds, then an indirect redemption with unqualified funds has occurred. James River responds by pointing out that the courts in Shenandoah and Morgan Stanley & Co. v. Archer Daniels Midland Co., 570 F. Supp. 1529 (S.D.N.Y.1983), also dealing with refund limitation language, confined their scrutiny to analyses of the funds actually used to redeem. We would add that both courts in those cases ruled that the defendants had not violated the subject indentures. We also note that those courts did not restrict their analyses to the result alone, but studied the economic realities underlying the subject transactions. However, those courts used the "source of funds" rule, a rule that we consider more appropriate for deciding whether James River violated the indenture.
In Shenandoah, using the "source of funds" rule, the court illustrated the potential sweep of the language condemning direct or indirect use of unqualified funds to redeem by hypothesizing that an issuer might buy an asset with lower-rate borrowed money and sell the asset to generate "qualified" funds for a redemption. Shenandoah, 14 Del. J. Corp. L. at 409. Under such a scenario, the actual source of the funds would not be the asset but the borrowed money that was used to acquire the asset that was then liquidated to cash. We hold that the refunding limitation, couched in terms that prohibit direct and indirect activity in whole or in part, should be applied with focus on the funds used for the redemption rather than on the entire transaction involving the successful tender for some bonds and redemption of other bonds. James River did not use lower-rate borrowed money to pay for the redeemed bonds. James River complied with the restrictions in the contract regarding the redemption of the bonds. A broader interpretation of the transaction would effectively rewrite the contract to give the investors more than they bargained for in an arm's-length transaction between sophisticated parties. The trial judge correctly entered the summary judgment for the defendants on the breach-of-contract claim.
The investors also alleged conversion, the tort of bad faith, and fraud. The trial court dismissed these claims, under Ala. R. Civ. P. 12(b)(6), for failure to state a claim. "The appropriate standard of review under Rule 12(b)(6) is whether, when the allegations of the complaint are viewed most *1179 strongly in the pleader's favor, it appears that the pleader could prove any set of circumstances that would entitle her to relief." Nance v. Matthews, 622 So. 2d 297, 299 (Ala. 1993).
The trial court dismissed the conversion claim because it concluded that James River did not wrongfully take any property of the investors. "To have a conversion claim, there must be (1) a wrongful taking, (2) an illegal assumption of ownership, (3) an illegal use or misuse of another's property, or (4) a wrongful detention or interference with another's property." Gillis v. Benefit Trust Life Ins. Co., 601 So. 2d 951, 952 (Ala.1992). The trial judge correctly stated:
We agree. The trial court properly dismissed the conversion claim.
The investors also argue that the defendants breached an implied covenant of good faith and fair dealing. Thus, they argue that the defendants acted in bad faith by retiring the bonds in the manner that they did. The trial judge correctly dismissed the bad faith claim, stating: "The tort of bad faith is recognized in this state only in the context of insurance policies. No insurance policy is involved in this case. While an obligation of good faith and fair dealing is implied in all contracts, it is directive rather than remedial." Because no insurance policy is involved, we conclude that the trial court properly dismissed the bad-faith claim. See Aplin v. American Sec. Ins. Co., 568 So. 2d 757 (Ala.1990).
The investors also claim that the defendants acted fraudulently by failing to disclose a variety of data regarding the financial condition of the company and the availability of qualified funds required for redemption of the bonds. The investors argue that this case presents a special situation where the defendants had "an affirmative duty to speak, and to disclose the concealed facts." The investors argue that they would have acted differently had they known the intentions of the defendants. The trial court dismissed the fraud claim because there was no showing that the defendants had a duty to disclose the information. "The elements of a suppression claim are 1) a duty to disclose the facts, 2) concealment or nondisclosure of material facts by the defendant, 3) inducement of the plaintiff to act, and 4) action by the plaintiff to his injury." Foremost Ins. Co. v. Parham, 693 So. 2d 409, 423 (Ala.1997). The defendants were not bound to disclose the facts the investors claimed that they should have been told. The trial court correctly stated:
The investors' fraud claim is grounded on what James River did not say, not on what it did say. They argue that James River, with the complicity of Merrill Lynch, perpetrated a "bluff" that allowed James River to redeem the debentures that were not tendered, when it would not have been able to do so but for the bluff. The bluff, which we would characterize as a calculated economic decision based on Merrill Lynch's statistical analysis, was the act of proffering a tender, which conceivably could have resulted in James River's not receiving enough tendered bonds to allow it to proceed with the announced redemption. They say that James River concealed its "desperately short cash position," thereby lulling the debenture holders into accepting the tender. The investors want the power to refuse to tender and to force James River either to find more qualified funds or to cancel the announced call. We do not interpret the indenture to give the bondholders that kind of power over the *1180 financial decisions of the corporation. The claim is speculative at best, in that it assumes that James River could not have sold more preferred stock to accomplish the redemption if that had been necessary. We agree with the trial court that James River had no duty to disclose its cash status to the investors. Therefore, the investors have failed to prove a claim of suppression. We hold that the trial court properly dismissed that claim.
The plaintiffs appealed the ruling on the Trust Indenture Act claim, and they have made a brief argument as to that claim upon their application for rehearing. That Act protects the "right of any holder of any indenture security to receive payment of the... interest on such indenture security." Because we conclude that no bondholder's payment of interest was impaired by the actions of James River, we affirm James River's summary judgment as to the TIA claim.
The investors claim that Merrill Lynch interfered with the contract between James River and the investors. They state that Merrill Lynch created the scheme to retire the bonds with lower-rate borrowed money. The trial court entered a summary judgment for Merrill Lynch on this tortious-interference claim because this claim was dependent on the success of the breach-of-contract claim. The trial judge determined that the tortious-interference claim failed because he held there had been no breach of contract. For a different reason, we agree with the trial court that Merrill Lynch did not tortiously interfere with the contract. An intentional-interference-with-business-relations claim requires:
Gross v. Lowder Realty Better Homes & Gardens, 494 So. 2d 590, 597 (Ala.1986).
We conclude that Merrill Lynch's actions were justified because James River had employed that firm to assist with the retirement of the bonds. Thus, the investors did not satisfy the fourth element. Merrill Lynch did not tortiously interfere with the contract between James River and the investors. The trial court properly dismissed the tortious-interference claim.
The investors argue that the trial court improperly denied class certification for the tort claims. The court denied certification because the plaintiffs are from different states and, therefore, different state laws would govern any fraud claims. However, there is no need to analyze this issue, because of our conclusion that the trial court properly dismissed the tort claims. There would be no reason to certify a class on a claim that is not viable. Therefore, we do not address the merits of the investors' argument on this issue.
Because the tender offer was not subject to the restrictions set out in the redemption clause and because James River bought back the redeemed bonds with qualified funds, the defendants did not breach the contract with the investors. The trial court properly entered the summary judgment for the defendants on the breach-of-contract claim and for Merrill Lynch on the tortious-interference claim. The trial court also properly dismissed the tort claims. Therefore, the judgment of the trial court is affirmed.
OPINION OF APRIL 17, 1998, WITHDRAWN; OPINION SUBSTITUTED; APPLICATION OVERRULED; AFFIRMED.
MADDOX, HOUSTON, SEE, and LYONS,[*] JJ., concur.
*1181 ALMON, SHORES, KENNEDY,[**] and COOK, JJ., dissent.
ALMON, Justice, dissenting.
The question here is whether the summary judgment was correctly entered on the investors' claims against James River and Merrill Lynch arising out of the simultaneous tender and call ("STAC") of James River's 10¾% debentures (sometimes referred to as bonds).[1] The indenture, pursuant to which the debentures were issued, prohibits redemption within the first 10 years (until October 1, 1998) with money borrowed at less than 10¾%. James River purchased about $200,000,000 of the debentures under the tender offer with money borrowed at 6¾% and redeemed less than $5,000,000 of the debentures with the proceeds of an issue of preferred stock. Of the total of $250,000,000 in debentures, James River purchased about $45,000,000 pursuant to the tender offer with other funds, which the plaintiffs allege were also the proceeds of low-cost debt. Thus, the holders of about $245,000,000 of the debentures responded to the tender offer. The plaintiffs contend that James River breached the indenture, and that James River and Merrill Lynch acted tortiously,[2] by using the $200,000,000 in funds borrowed at 6¾% toward the retirement of the bonds.
The circuit court held there was no breach of the indenture and, therefore, no tortious conduct, because James River used only qualified fundsthe proceeds of the sale of preferred stocktoward the redemption. The circuit court's order construes the complaint as confusing the tender offer with the redemption and as taking the position that the indenture prohibits James River from making a tender offer with low-cost borrowed funds. This is not the plaintiffs' position. Under the plaintiffs' construction, the indenture would allow a tender offer with low-cost borrowed funds, so long as the threat of a follow-up redemption did not coerce acceptance of the tender offer at an artificially lowered price. In short, it is the very coordination of the tender offer with the redemption, the simultaneous aspect of the STAC, that violates the debenture.
Here are the figures that demonstrate the plaintiffs' theory. The indenture allows redemption with qualified funds (e.g., retained earnings or proceeds of a sale of stock) in fiscal 1992 at a price of 108.60% of the principal amount of the indentures, plus accrued interest. On September 18, 1992, Merrill Lynch published notice of the STAC, making a tender offer at $1093.75 per $1,000 of principal of the bonds, plus accrued interest. The STAC letter stated that James River "currently intends to redeem Bonds not purchased pursuant to the offer as provided in the Indenture." The letter later notes that the indenture provides for redemption between October 1, 1992, and September 30, 1993, "at 108.60% of their principal amount, and at prices decreasing annually thereafter to 100% of their principal amount on or after October 1, 2008." In short, the letter said, "Either tender at $1093.75 per $1,000 or we will redeem at $1086.00 (or less) per $1,000."
Absent the threat of the redemption, the tender offer would have to be made at or near the market value of the debentures. The plaintiffs provided evidence that Merrill Lynch calculated a value of the bonds in June 1992, assuming they could remain outstanding until 1998, at $1146.16 per $1,000, and, in July 1992, calculated a value of $1210.20 per $1,000. Thus, the tender offer was more than $50 less than the June calculation and more than $116 less than the July calculation of market value per $1,000 in principal amount.
Nevertheless, because the tender offer was backed by the threat of a redemption, at an even lower price, to conclude the retirement of the bonds, the bondholders could not afford to ignore the tender offer. The activity that the plaintiffs refer to as tortious is the *1182 concealment of the fact that, at the time of the STAC, James River had only $3,000,000 in qualified funds on hand and could not raise more than $100,000,000 from the sale of preferred stock. In fact, from that sale, $80,000,000 was used to retire other high-cost debt that similarly required the use of qualified funds. Therefore, the plaintiffs presented evidence that James River had a maximum of only $23,000,000 available for the threatened redemption. If the bondholders had known this, they say, they would not have tendered at what they considered an unfairly low price of $1,093.75.
The indenture prohibits redemption in the first 10 years
(Emphasis added.) This is termed a "non-refund" provision, because the extinguishment of debt with other debt is a "refunding" of the debt.
The parties and the circuit court have treated three cases as being the most dispositive cases, most closely on point: Franklin Life Ins. Co. v. Commonwealth Edison Co., 451 F. Supp. 602 (S.D.Ill.1978), aff'd, 598 F.2d 1109 (7th Cir.), cert. denied, 444 U.S. 900, 100 S. Ct. 210, 62 L. Ed. 2d 136 (1979); Morgan Stanley & Co. v. Archer Daniels Midland Co., 570 F. Supp. 1529 (S.D.N.Y.1983); and Shenandoah Life Ins. Co. v. Valero Energy Corp., (No. 9032, June 21, 1988) 14 Del.J.Corp.L. 396 (Del. Ch.1988) (not published in Atlantic Reporter).[3] These three cases were published before these indentures were issued in October 1988; James River and Merrill Lynch argue that they provided notice that the non-refund provision would not prevent a STAC. However, I do not find them to support the circuit court's judgment. I note the following two points as the principal distinguishing features: (1) None of these three cases involved a STAC; in all three cases, all of the securities or bonds were redeemed. (2) In each case, the redeeming issuer had enough qualified funds available to effect the entire redemption. The investors' argument was that incurring substantial low-cost debt contemporaneously with the redemption violated the non-refund provision. The court in each case held that, because the issuer was careful to segregate the qualified funds and to use only qualified funds for the redemption, the fact that the issuer was also engaging in low-cost borrowing at the same time would not establish an indirect use of the low-cost debt to refund the bonds (or, in Franklin Life, 10¾% preferred stock that was subject to a non-refund provision). This is called the "source rule" because the court looks only at the source of the funds actually used for the redemption, not at the redeeming issuer's overall debt and capital structure.
Those three cases can easily be distinguished. In each of them, the issuer of the bonds had sufficient qualified funds on hand to retire the entire nonrefundable bond issue, so the redemption using those funds did not violate the non-refund provision. Here, James River could not retire the entire principal amount of the 10¾% bonds with qualified funds, and it concealed that fact from its investors when making the STAC. By retiring 98% of the bonds through 6¾% debt proceeds and other nonqualified funds, James River was able to reduce the amount of outstanding bonds to an amount that it could redeem with qualified funds. This, say the plaintiffs, amounts to an indirect use of the 6¾% debt to effect a redemption, in violation of the non-refund provision.
I agree with the plaintiff investors that a fact question is presented on these issues. I would hold that the summary judgment was inappropriate on the contract count. I think *1183 some of the tort counts could probably also present fact questions, but in view of the majority's holding it is not necessary for me to address those counts.
For the foregoing reasons, I dissent.
SHORES, KENNEDY, and COOK, JJ., concur.
[*] Justice Lyons was not a member of this Court when this case was orally argued; however, he has listened to the tape of the oral argument.
[**] Although Justice Kennedy was not present at oral argument, he has reviewed the videotape of the oral argument.
[1] Three of the plaintiffs' claimsfraud, conversion, and bad faithwere actually dismissed, but I will not discuss those claims separately in this dissent.
[2] The complaint also included a count alleging that the defendants had violated the Trust Indenture Act, 15 U.S.C. § 77ppp(b).
[3] Mann v. Oppenheimer & Co., 517 A.2d 1056 (Del.1986), is factually similar to this case in some respects. In that case, Oppenheimer did not follow through with a redemption, and the question was whether it had fraudulently threatened to follow the tender offer with a redemption without truly intending to redeem the bonds not tendered. The Supreme Court of Delaware reversed a summary judgment for Oppenheimer, holding that a fact question was presented on the fraud claim. The result in Mann does not support the summary judgment here. | 0f378ee005a524f83757697053b79b7bc08051613e48df7a9e30cc8fafe890d2 | 1998-06-19 00:00:00 |
3bdd0137-bc64-4f63-b5ce-dee3bb21e2a4 | Alfa Mut. Ins. Co. v. Roush | 723 So. 2d 1250 | 1950232 | Alabama | Alabama Supreme Court | 723 So. 2d 1250 (1998)
ALFA MUTUAL INSURANCE COMPANY
v.
Richard Charles ROUSH et al.
1950232.
Supreme Court of Alabama.
September 11, 1998.
*1251 Thomas M. Galloway, Jr., and Robert H. Smith of Collins, Galloway & Smith, Mobile, for appellant, on original submission.
Joseph M. Brown, Jr., Andrew T. Citrin, Kelli D. Taylor, and David G. Wirtes, Jr., of Cunningham, Bounds, Yance, Crowder & Brown, L.L.C., Mobile, for appellees, on original submission.
Thomas M. Galloway, Jr., and Robert H. Smith of Galloway, Smith, Wettermark & Everest, Mobile; and William P. Gray, Jr., of Gray & Jauregui, Montgomery, for appellant, on application for rehearing.
Joseph M. Brown, Jr., and David G. Wirtes, Jr., of Cunningham, Bounds, Yance, Crowder & Brown, L.L.C., Mobile, for appellees, on application for rehearing.
Michael L. Roberts of Cusimano, Keener, Roberts & Kimberley, P.C., Gadsden, for amicus cuiae Alabama Trial Lawyers Ass'n, on application for rehearing.
PER CURIAM.
The opinion of July 2, 1998, is withdrawn and the following is substituted therefor.
Alfa Mutual Insurance Company ("Alfa") appeals from a judgment entered upon a jury verdict in favor of the plaintiffs Richard Charles Roush, Randy Earl Townsend, and Sea Breeze Seafood, Inc., on claims alleging wrongful acts on the part of Alfa's agent Roland Patronas. We reverse and remand.
Roush, Townsend, and Sea Breeze sued Alfa and Patronas, alleging that Patronas, as Alfa's agent, had purported to sell them workers' compensation insurance from a "pool coverage" insurer; that Patronas converted their premium payment for his own use and misrepresented to them that he had procured the insurance for them; and that *1252 Alfa was vicariously responsible for Patronas's misconduct. The plaintiffs further alleged that Alfa had wantonly and recklessly failed to supervise Patronas and that Alfa had wantonly encouraged and required its agents to sell pool insurance coverage for its own benefit without providing any safeguards for the insureds.
The trial court denied Alfa's summary judgment motions, and the case went to trial on the issues of vicarious liability and wantonness. Alfa moved for a directed verdict at the close of the evidence and renewed the directed verdict motion at the close of all the evidence. The trial court denied these motions. [1] The jury returned a verdict in favor of the plaintiffs, awarding them $100,000 in compensatory damages and $1,000,000 in punitive damages. Alfa moved for a JNOV or, in the alternative, a new trial or a remittitur of the damages awards. The court denied that motion and entered a judgment on the verdict. Alfa appeals from the denial of its directed verdict and JNOV motions.
A directed verdict is proper if the nonmoving party has not presented substantial evidence regarding some element essential to the claim or if there is no disputed issue of fact upon which reasonable persons could differ. Teague v. Adams, 638 So. 2d 836 (Ala.1994). The court applies this same standard to a motion for a JNOV. Williams v. Allstate Ins. Co., 591 So. 2d 38 (Ala.1991). When reviewing the trial court's ruling on the motion, we must view the evidence most favorably toward the nonmovant to determine whether there was sufficient evidence to create an issue of fact for the jury. Bussey v. John Deere Co., 531 So. 2d 860 (Ala. 1988). With these standards of review in mind, we note the following facts from the record:
In 1979, Alfa hired Roland Patronas as its agent, under an exclusive agency contract, which prohibited Patronas from writing any insurance other than Alfa policies and Alfa-approved pool insurance policies. The approved pool insurance was available through the National Council on Compensation Insurance, Inc. ("NCCI"); the Alabama Insurance Underwriters Association ("AIUA"); and the National Flood Insurance Program. Alfa did not write pool insurance coverage.
Alfa provided Patronas with an office and an Alfa business sign, as well as business equipment and office personnel. Alfa also provided Patronas with preprinted insurance application forms for both Alfa Insurance and pool insurance. Alfa and Patronas shared the expense of television, radio, and billboard advertisements for Alfa, including a billboard in the Grand Bay area that featured Patronas's picture. Some of these advertisements included the slogan "One call, one agent, one less hassle"; and Patronas explained in his testimony at trial that, throughout his career with Alfa, he had represented to the public that he was the "one-stop" shopping center for insurance purchasers. Patronas also explained that Alfa had encouraged him to write pool coverage for his clients if Alfa could not provide a policy they needed; and that by his doing so, Alfa could avoid losing customers that it could not directly insure. Alfa did not publicly distinguish itself from the insurers providing pool coverage and did not otherwise inform its customers that it would not be responsible for pool coverage written by its agents.
Before August 1993, Alfa's "field procedure manual" outlined a strict system for controlling, monitoring, and auditing how agents handled Alfa's money. Alfa agents were required to produce a field receipt for any Alfa money they received, and an Alfa secretary and/or customer service representative maintained a daily transaction sheet to record all of the money that was brought in for Alfa. There were fixed Alfa procedures for handling all receipts of Alfa's money in any form. Alfa established a bank account for Patronas and required him, or his secretary, to deposit all of Alfa's money into that account within 24 hours of receiving it. Alfa *1253 did not, however, have any safeguards for handling money received from the sale of pool coverage; it had no procedures for the daily accounting for such money, nor did it conduct any audits to monitor the sale of pool insurance coverage. Alfa agents were not required to keep any records regarding the sale of pool insurance policies to Alfa customers.
In 1992, Patronas received a telephone call from Richard Roush, a client who had recently established a new business, Sea Breeze Seafood, Inc. Roush told Patronas that a representative from the Alabama Department of Industrial Relations had informed him that the corporation was required to obtain workers' compensation insurance. Patronas met with Roush and Roush's business partner, Randy Townsend, on the premises of Sea Breeze and told them that he would "take care of" their workers' compensation insurance; however, Patronas did not inform Roush and Townsend of the fact that Alfa did not write workers' compensation insurance and that he could obtain coverage for them only through a pool insurance provider. Roush wrote a $2,824 check from Sea Breeze's account, made payable to Patronas, for the insurance premium. During the course of the meeting, Patronas also sold Roush and Townsend, on behalf of Sea Breeze, Alfa policies for general liability, products-liability, and automobile insurance.
Patronas subsequently wrote the Alfa liability and automobile insurance policies for Sea Breeze, collected premiums for these policies, and forwarded the money to Alfa, in accordance with Alfa's procedures for reporting sales. However, Patronas did not procure the workers' compensation coverage for Sea Breeze; instead, he cashed the Sea Breeze check, converted the funds for his personal use, and then misrepresented to Roush that he had procured the workers' compensation insurance.
Approximately two months later, a Sea Breeze employee suffered an on-the-job injury and sought workers' compensation benefits. Roush, under the mistaken belief that Patronas had procured workers' compensation coverage for Sea Breeze, completed an incident report form and returned it to Alfa's Grand Bay office. One month later, a second employee sought workers' compensation for a work-related injury; Roush followed the same procedure.
Roush and Townsend subsequently began receiving the medical bills for services rendered to Sea Breeze's two injured employees. Roush asked Patronas when Alfa would begin paying the medical bills. Patronas represented to Roush that the workers' compensation policy had not been issued yet, but that the bills would be taken care of eventually. Patronas suggested that Roush have Sea Breeze pay the bills and then wait until the end of the year, or until the claims were processed, to get a refund. Patronas also suggested that Sea Breeze could avoid an increase in its workers' compensation premium rates by paying the claims itself and not submitting any claims to Alfa.
Soon thereafter, a representative from the Department of Industrial Relations again contacted Roush to determine whether Sea Breeze had obtained workers' compensation coverage. Roush gave the representative Patronas's telephone number; when Patronas received a call from the Department of Industrial Relations representative to verify Sea Breeze's coverage, he told the representative that Sea Breeze did indeed have workers' compensation coverage and gave her a false policy number.
On July 29, 1993, Jerry Grace, Alfa's district manager in Mobile, received a letter from a woman named Janice Stewart. Ms. Stewart's letter stated that she had applied for certain pool insurance coverage through Patronas two years earlier, that Patronas had purported to obtain this coverage for her, and that he had cashed her $3,471 premium check. Ms. Stewart's letter further stated that she had never received a copy of the policy and that Patronas had refused to answer her inquiries about the coverage.
Grace forwarded Stewart's letter to Alfa's internal audit director, Connie Whitecotton, who received it on August 2, 1993. On that same day, Whitecotton assigned Tommy Fikes, a certified fraud examiner and senior auditor at Alfa, to investigate Patronas's business activities. Fikes began an audit of *1254 Patronas's Grand Bay office on August 4, and on that day Patronas was given a two-week suspension.
On August 5, 1993, Fikes met with two Alfa customer service representatives at Alfa's Grand Bay "service center." Fikes learned that Sea Breeze had attempted to file with Alfa two claims for benefits under a policy of workers' compensation insurance that Patronas had promised to procure for Sea Breeze. Both customer service representatives were under the impression that Patronas had actually obtained the insurance, and one of them informed Fikes that both Roush and Townsend believed Patronas had done so. Fikes noted that the Sea Breeze file had no record of any such insurance.
Grace instructed Fikes to find out whether Sea Breeze had workers' compensation coverage. Fikes visited Townsend at his home; he learned from Townsend that Roush believed Patronas had obtained the coverage for Sea Breeze. Fikes admitted to Townsend that the workers' compensation policy was not listed in the file and that he did not know whether Sea Breeze had the coverage. Fikes told Townsend that he would check into the matter and report back to him.
On August 9, 1993, an Alfa investigator telephoned NCCI to inquire whether Sea Breeze or Townsend had workers' compensation insurance with NCCI and learned that NCCI had no record of such insurance under either name. Fikes then telephoned to determine whether there was NCCI coverage under Roush's name; he learned that there was no such coverage. Fikes telephoned Townsend on August 10 and asked Townsend to provide a copy of the premium check.
On August 18, 1993, Townsend telephoned Fikes and informed Fikes that Patronas had confessed to Roush that he had not used the premium check to buy workers' compensation insurance for Sea Breeze. Townsend asked Fikes what Alfa was going to do about it, and Fikes told Townsend he would consult Alfa's legal department. Ms. Whitecotton then telephoned Townsend and informed him that "Alfa wanted to make him whole" and that someone from Alfa would contact him to negotiate how Alfa could make him whole.
On August 19, 1993, Terry McCollum, Alfa's senior vice president of claims, was notified of the suspicions against Patronas. McCollum immediately assigned a claims adjuster, Terry Barnes, to contact Patronas's other clients and determine whether Patronas had converted any of their premium payments for his own use. McCollum instructed Barnes to find out what Patronas had promised the clients and, if Patronas's promises had not been kept, to give the clients whatever coverage they had been promised, to pay whatever claims had been made, and to refund premiums where necessary.
Barnes contacted Roush and Townsend on August 19, 1993, requesting that they provide him documentation regarding the medical bills and lost wages of the two Sea Breeze workers who had made workers' compensation claims. After several conversations with Barnes over the next few days, Roush and Townsend demanded that Alfa provide coverage for the workers' compensation claims and guarantee that payment of these claims would create no problems with their personal insurance coverage. They also demanded that Alfa reimburse them for the premium they had paid to Patronas and pay them each $20,000. After Roush and Townsend had this conversation with Barnes, a representative of the Department of Industrial Relations informed Roush and Townsend that the Department was aware that Sea Breeze did not have workers' compensation insurance. Townsend and Roush then hired a lawyer. When Barnes contacted them shortly thereafter to accept their demands, they told him they had hired a lawyer. Alfa terminated Patronas's employment on August 27, 1993. Townsend and Roush filed this lawsuit five days later, on September 1, 1993.
Alfa subsequently learned that Patronas had stolen over $83,000 from Alfa customers who had sought pool insurance through him. Alfa reported Patronas's thefts to the Mobile County district attorney. Patronas ultimately pleaded guilty to four counts of theft by deception in the first degree, one count of theft by deception in the second degree, and one count of theft by deception in the third degree. Patronas was sentenced to five *1255 years' probation and was ordered to pay restitution of $56,674.
The trial court presented to the jury two theories upon which the plaintiffs sought punitive and compensatory damages: (1) that Alfa was vicariously liable under § 6-11-27, Ala.Code 1975, for Patronas's acts and (2) that Alfa had wantonly failed to supervise Patronas's sale of pool insurance coverage and was directly liable for its own failure. Alfa argues that neither theory was supported by the evidence and that the trial court thus erred in denying its motions for directed verdict and JNOV.
Alfa first argues that it is not vicariously liable under § 6-11-27 for Patronas's theft of Sea Breeze's insurance premium and his misrepresentations to Roush and Townsend. Section 6-11-27(a) provides, in pertinent part:
(Emphasis added.)
Thus, an employer may be "vicariously liable for acts of its employee that were done for the employer's benefit, i.e., acts done in the line and scope of employment or... acts done for the furtherance of the employer's interest." Potts v. BE & K Constr. Co., 604 So. 2d 398, 400 (Ala.1992). It is clear that Alfa expressly authorized and encouraged its agents to sell pool insurance coverage to Alfa customers who needed a kind of insurance coverage that Alfa could not write. An Alfa agent who obtained pool insurance coverage for a customer could, at the same time, attempt to sell that customer the kinds of insurance Alfa could write. Moreover, Alfa compiled customer lists and customer-identification data through those agents who obtained pool insurance coverage for Alfa customers, thereby generating the opportunity to solicit further business from these customers in the future. Thus, by encouraging its agents to sell pool insurance coverage, Alfa could market itself as a "one stop" insurance center, thereby developing customer loyalty and expanding its base of contacts for selling more of its policies.
When Patronas was an Alfa agent, Alfa had a strict and elaborate system of safeguards to prevent an agent from misappropriating the premiums for Alfa policies that an agent is able to sell in the course of obtaining pool insurance coverage for customers. [2] However, at that time, Alfa did not require an accounting from an agent who obtained pool insurance coverage for a customer; it had no form of precaution to discourage an agent from pocketing the premium the customer paid for pool insurance coverage. Instead, Alfa relied solely upon the pool insurance providers to monitor the sale of these policies by Alfa agents, avoiding the extra expense or inconvenience of providing its own "backup" safeguard.
It is evident how Alfa directly benefited from its encouraging Patronas to obtain pool insurance coverage for Alfa's customers without Alfa's providing any means of monitoring his performance. Roush contacted Patronas for the sole purpose of obtaining workers' compensation insurance for Sea Breeze; he was not seeking any other kind of coverage. However, when Patronas visited Roush to collect the $2,824 workers' compensation premium check, he was able to sell Roush and *1256 Townsend three separate Alfa policies. Alfa's lack of supervision of Patronas's "sale" of the pool insurance policy enabled him to steal the premium intended for that policy, while Alfa's elaborate system of monitoring the sales of its own policies ensured that it would receive the premiums from those sales. The evidence was sufficient to support a finding that Alfa encouraged Patronas to sell pool insurance policies; that it provided no supervision of his sales; and that, in this regard, Alfa acted purely for its own profit. The trial court thus correctly denied Alfa's motions for directed verdict and JNOV on the issue of Alfa's vicarious liability for Patronas's misconduct.
Alfa next argues that the trial court erred in denying its motions for a directed verdict and later its motion for a JNOV on the plaintiffs' claims that Alfa acted wantonly in encouraging Patronas to sell pool insurance coverage but not supervising his sales. This Court has previously observed that § 6-11-27 modifies the common-law rule of vicarious liability by requiring proof of a higher degree of culpability on the part of the principal. Thus, as a logical matter, plaintiffs who meet the statutory requirement for vicarious liability will, in many cases, also have established the elements of a claim alleging wantonness in the hiring and supervision of the agent. Northwestern Mut. Life Ins. Co. v. Sheridan, 630 So. 2d 384 (Ala.1993). We agree, however, that this is not true in every case; a plaintiff who establishes a principal's vicarious liability for its agent's acts does not automatically establish a claim of wantonness against the principal.
We agree that the evidence would support a finding that Alfa was heedless in encouraging its agents to sell pool insurance coverage in order to procure more business for Alfa, without establishing any form of agent accountability for the premiums paid for the pool insurance coverage. However, the evidence is not sufficient in itself to establish that Alfa wantonly encouraged this practice. To prove that, the plaintiffs had to present evidence that Alfa knew that the practice would likely or probably result in the harm or loss that Patronas caused. "Wantonness" is statutorily defined as "[c]onduct which is carried on with a reckless or conscious disregard of the rights or safety of others." Ala.Code 1975, § 6-11-20(b)(3). "Wantonness" has been defined by this Court as the conscious doing of some act or the omission of some duty, while knowing of the existing conditions and being conscious that, from doing or omitting to do an act, injury will likely or probably result. Bozeman v. Central Bank of the South, 646 So. 2d 601 (Ala.1994). To prove wantonness, it is not essential to prove that the defendant entertained a specific design or intent to injure the plaintiff. Joseph v. Staggs, 519 So. 2d 952 (Ala.1988). We pause here to note the concern expressed by the bench and bar over the definition of wantonness set out in Lynn Strickland Sales & Service, Inc. v. Aero-Lane Fabricators, Inc., 510 So. 2d 142, 145 (Ala.1987). Certain language in Lynn Strickland suggested that a specific design or intent to injure the plaintiff was an element of a claim for wantonness. To the extent that Lynn Strickland deviates from the statutory definition of wantonness, as followed by this Court, it is hereby overruled.
Although Alfa did not provide its own safeguards against an agent's stealing pool insurance premiums, it instructed its agents to comply with whatever regulations a pool insurer required for the sale of its policies. The record shows that Alfa agents normally dealt directly with the pool insurers in procuring pool insurance and that they abided by those insurers' instructions in reporting sales and transferring premiums. It is undisputed that before Patronas's actions became apparent, Alfa had received no complaints about agents' converting pool insurance coverage premiums for their own use and had no notice that any Alfa agent had ever done that. Moreover, it is clear that Alfa did not know, or have reason to suspect, that Patronas was a dishonest or "rogue" agent and would scheme to steal pool insurance coverage premiums from Alfa customers. On the contrary, the record is replete with testimony indicating that Patronas was a trusted Alfa employee, that he was well respected by his customers and colleagues, and that he was popular *1257 and active in community affairs. It is well established that news of Patronas's wrongdoing came as a shock to those who knew him personally and professionally. It is also clear that once Alfa received the first notice of possible wrongdoing on the part of Patronas, it acted quickly to uncover the facts about his thefts, to rectify any damage he had caused, and to remove him from its employment.
After carefully reviewing the evidence in the record, we agree that it does not support a finding that Alfa knew that its lack of supervision over the sale of pool insurance policies would likely or probably result in Patronas's theft of pool insurance policy premiums. The trial court, therefore, erred in denying Alfa's motion for a directed verdict, which was argued with specificity, and, later, its motion for a JNOV, as to the claim of wantonness.
As we have discussed, the plaintiffs sought damages based upon the claim that Alfa was both vicariously liable for Patronas's acts and directly liable for its own failure to supervise Patronas. The claim alleging a wanton failure to supervise was not supported by the evidence and should not have been presented to the jury. When a jury returns a general verdict upon two or more claims, as it did here, it is not possible for this Court to determine which of the claims the jury found to be meritorious. Therefore, when the trial court submits to the jury a "good count"one that is supported by the evidenceand a "bad count" one that is not supported by the evidence and the jury returns a general verdict, this Court cannot presume that the verdict was returned on the good count. In such a case, a judgment entered upon the verdict must be reversed. See, Aspinwall v. Gowens, 405 So. 2d 134 (Ala.1981); see, also, St. Clair Federal Sav. Bank v. Rozelle, 653 So. 2d 986 (Ala.1995). The jury did not specify which claim it based its verdict upon, and we cannot presume that it was based solely upon the "good" count, i.e., the claim that Alfa was vicariously liable under § 6-11-27 for Patronas's intentional acts. The jury could have based its verdict, awarding compensatory and punitive damages, solely upon the "bad" count, i.e., the claim that Alfa had wantonly failed to supervise Patronas. The judgment is, therefore, reversed, and the cause is remanded for a new trial.
OPINION OF JULY 2, 1998, WITHDRAWN; OPINION SUBSTITUTED; APPLICATION OVERRULED; REVERSED AND REMANDED.
KENNEDY and LYONS, JJ., concur.
HOUSTON and COOK, JJ., concur specially.
ALMON and SHORES, JJ., concur as to Part I; as to Part II, dissent in part and concur in the order remanding for a new trial.
HOOPER, C.J., and SEE, J., dissent as to Part I; concur in part as to Part II; and dissent from the order in Part II remanding for a new trial.
HOUSTON, Justice (concurring specially).
I dissented in Lynn Strickland Sales & Service, Inc. v. Aero-Lane Fabricators, Inc., 510 So. 2d 142 (Ala.1987), based on the distinction between negligence and wantonness. I wrote, at 510 So.2d at 148-49:
(Citations omitted.)
Although Chief Justice Torbert and Justice Steagall joined my dissent, the majority of the Court held:
510 So. 2d at 145-46. This became the law of Alabama in Lynn Strickland, and the Legislature in 1987 adopted this Lynn Strickland definition of wantonness in Ala.Code 1975, § 6-11-20(b)(3). I now adhere to the majority's distinction between negligence and wantonness. See Coca-Cola Bottling Co. United, Inc. v. Stripling, 622 So. 2d 882, 884-85 (Ala.1993).
Having said that, however, I note again, as I have in the past, that the Court, in Lynn Strickland Sales & Service, Inc. v. Aero-Lane Fabricators, Inc., supra, at 145, muddied the waters by stating that "wantonness is characterized as an act which cannot exist without a purpose or design, a conscious or intentional act." Those words suggest willful or intentional wrongdoing, not wantonness. The Court today overrules Lynn Strickland to the extent that this particular language from that case is inconsistent with the statutory definition of wantonness. This should eliminate any unnecessary confusion in future cases.
I concur with that portion of the per curiam opinion holding that the evidence was sufficient to support a finding of vicarious liability on Alfa's part. I also concur with respect to that portion of the opinion holding that the evidence was insufficient to establish wantonness. The judgment is due to be reversed on the authority of Aspinwall v. Gowens, 405 So. 2d 134 (Ala.1981).
COOK, Justice (concurring specially).
I concur in Part I of the per curiam opinion holding that the count seeking to impose vicarious liability on Alfa was properly submitted to the jury. I also concur in Part II, which addresses the wantonness count and concludes that the plaintiffs did not present sufficient evidence to submit the wantonness count to the jury. I write specially to express my agreement with the overruling of Lynn Strickland Sales & Serv., Inc. v. Aero-Lane Fabricators, Inc., 510 So. 2d 142, 145 (Ala.1987), to the extent that that case infused the definition of "wantonness" with the concept of intent. My disagreement with the concept of wantonness as expressed in Lynn Strickland is based upon the recognition that Lynn Strickland tends to treat "knowledge" and "intent" as synonymous terms. The Court today distinguishes these terms by pointing out that to establish wantonness it is not necessary to prove that the defendant harbored a specific design or intent to injure the plaintiff. 723 So. 2d at 1256. It is only required that the plaintiff prove that the defendant caused harm by the conscious doing of some act or the conscious omission of some duty, while knowing of the existing conditions and being conscious that, from doing or omitting to do an act, injury would likely or probably result. See Bozeman v. Central Bank of the South, 646 So. 2d 601 (Ala.1994).
ALMON, Justice (concurring as to Part I; as to Part II, dissenting in part and concurring in the order remanding for a new trial).
I respectfully dissent from the reversal. I agree that the count seeking to impose vicarious liability on Alfa was properly submitted to the jury, and I therefore concur as to Part I of the per curiam opinion. I disagree, however, with the per curiam opinion insofar as it holds that there was not substantial evidence supporting the allegation that Alfa should be held directly responsible for wantonly failing to provide adequate safeguards for the handling of pool insurance premiums. Because I agree that the vicarious liability count was properly submitted to the jury, I agree that, in light of the majority's decision to reverse the judgment, the case is due to be retried on the vicarious liability count. For that reason, I concur in the order remanding for a new trial.
I agree with the majority's decision to overrule Lynn Strickland Sales & Service, Inc. v. Aero-Lane Fabricators, Inc., 510 So. 2d 142, 145 (Ala.1987), regarding the standard for proof of wantonness. Although I concurred in Lynn Strickland, I see in reviewing the arguments in this case that some of its statements are slightly misleading, at *1259 least when taken out of context. Part of this confusion comes from the fact that the Lynn Strickland opinion was contrasting negligence, on the one hand, with wanton, reckless, or willful conduct, on the other hand. The following statements, without actually saying so, tend to imply that wantonness requires proof of intentional wrongdoing:
510 So. 2d at 145 (emphasis added). The first two portions of the text that I have emphasized are correct statements of the law, but notice that the second emphasized phrase is simply saying what is not present in negligence; it does not say that "intent" is an element of wantonness. The last statement is correct insofar as it says that wantonness requires a "conscious ... act," but incorrect insofar as it requires, for wantonness, "a purpose or design, a[n] ... intentional act." These words describe willful or intentional wrongdoing, not wantonness.
In my judgment, substantial evidence of wantonness is apparent from the per curiam opinion. Alfa established effective safeguards for the handling of money received to pay premiums on Alfa policies, but, as the per curiam opinion states, "Alfa did not, however, have any safeguards for handling money received from the sale of pool coverage." 723 So. 2d at 1253. The very fact that Alfa established controls for the handling of its money by its agents and employees is evidence that it was acting "while knowing of the existing conditions and being conscious that, from doing or omitting to do an act, injury [would] likely or probably result." Bozeman v. Central Bank of the South, 646 So. 2d 601, 603 (Ala.1994). That is, those controls are evidence of Alfa's consciousness that there is a likelihood that unsupervised handling of money will result in theft or misappropriation. Why should it be deemed any less conscious of that same possibility in regard to the pool insurance money?
The per curiam opinion states, "Alfa's lack of supervision of Patronas's `sale' of the pool insurance policy enabled him to steal the premium intended for that policy, while Alfa's elaborate system of monitoring the sales of its own policies ensured that it would receive the premiums from those sales." 723 So. 2d at 1256. (Emphasis added.) The very contrast between the "lack of supervision" and the "elaborate system of monitoring" seems, to me, to provide a sustainable inference of wantonness. Indeed, I agree that Alfa "enabled" Patronas to steal the premiums, and I think the jury was properly allowed to conclude that it wantonly did so.
The per curiam opinion states that "Alfa relied solely upon the pool insurance providers to monitor the sale of these policies by Alfa agents, avoiding the extra expense or inconvenience of providing its own `backup' safeguard." 723 So. 2d at 1255. It is not clear to me how the pool insurers could have adequately monitored the offices of an Alfa agent such as Patronas, who was selling pool insurance only incidentally to, and in furtherance of, the agent's sales of Alfa insurance policies. It seems to me that it is Alfa that was in a position to institute the "primary" safeguard and that the pool insurers, if anything, might have sought some "backup" safeguard. Certainly, at the least, "avoiding the extra expense or inconvenience" of adding the pool insurance premiums to the existing safeguards is the kind of failure to act, with knowledge of likely consequences, that can fairly be characterized as wantonness.
The following passage from the per curiam opinion further illustrates that the plaintiffs presented substantial evidence of wantonness:
723 So. 2d at 1256 (emphasis added). To my understanding, "heedless" conduct is "wanton" conduct. See, e.g., Berry v. Fife, 590 So. 2d 884 (Ala.1991). Alfa's wanton conduct was not the act of "encourag[ing][the] practice" of selling pool insurance; it was the act of doing so without instituting any of the safeguards it considered important in regard to its own insurance premiums. I agree that harm must be likely or probable, but I am not sure that the terms "likely or probably" here means "more probable than not," and that term certainly does not mean "almost certain." Is it not a jury question if there is a sufficient degree of probability for a reasonable, prudent person to guard against it?
Further, I agree that "the plaintiffs had to present evidence that Alfa knew that the practice would likely or probably result in" harm or loss, but not necessarily "the harm or loss that Patronas caused." 723 So. 2d at 1256. The per curiam opinion also states that the evidence "does not support a finding that Alfa knew that its lack of supervision over the sale of pool insurance policies would likely or probably result in Patronas's theft of pool insurance policy premiums." 723 So. 2d at 1257. (Emphasis added.) This sounds as though Alfa was not conscious of the risk that agents would steal pool money unless it knew exactly which agent might do so. This thought is also expressed in the statement that testimony indicated that "Patronas was a trusted Alfa employee, that he was well respected by his customers and colleagues, and that he was popular and active in community affairs." 723 So. 2d at 1256. I do not take the plaintiffs to be suggesting that Alfa should have instituted controls over pool money only in Patronas's office. Rather, the wantonness is in the failure to attend on an institutional basis to the likelihood that, somewhere among Alfa's agents, one would eventually fall prey to the temptation to abscond with some of the unsupervised pool insurance premiums.
The per curiam opinion cites the evidence indicating that Alfa had not previously received complaints about agents' converting pool insurance premiums. I agree that this evidence tends to negate the inference of wantonness, but I do not believe that it conclusively precludes the possibility of a finding of wantonness. To state the point hyperbolically, the fact that no one had previously stolen money that Alfa had left lying unattended did not mean that it was unlikely that anyone ever would. Also, I agree that Alfa's prompt and effective actions upon receiving notice of Patronas's failure to place pool insurance for Roush, Townsend, and Sea Breeze is evidence tending against a finding of culpable conduct by Alfa. Again, however, the jury found that Alfa was wanton, and the fact that it acted promptly to rectify its agent's wrongdoing does not absolve it from liability for its "heedless" conduct that made such wrongdoing more likely.
I believe this case is unlike Cessna Aircraft Co. v. Trzcinski, 682 So. 2d 17 (Ala. 1996). The Cessna safety harness that failed and thereby contributed to Trzcinski's injury was improperly stitched, but there was "no evidence presented that the seamstress knowingly left out the stitching or acted with a conscious or reckless disregard in manufacturing the harness." 682 So. 2d at 20-21. As the opinion explains, Cessna had carefully designed and tested the harnesses and had established inspection procedures to safeguard against faulty construction of individual harnesses. In short, the evidence established only simple negligence in an isolated case, not a wanton failure to institute adequate safeguards.
Furthermore, I see a distinction between this case and Harco Drugs, Inc. v. Holloway, 669 So. 2d 878 (Ala.1995). Harco Drugs considered, but did not implement, a procedure for its employees to verify that the pharmacist had correctly filled a prescription. The number of incidents of misfilled prescriptions was very small, and many of those incidents were not the pharmacist's fault (such as the cashier's giving a customer another customer's prescription). Dissenting in Harco *1261 Drugs, I expressed the opinion that there was not substantial evidence of wantonness. To analogize Harco Drugs to the facts of this case, it would be as though Harco had instituted safeguards regarding the filling of some prescriptions but not others. Moreover, the majority found evidence of wantonness in Harco Drugs; that seems inconsistent with the holding here that there was not substantial evidence of wantonness.
For the foregoing reasons, I respectfully dissent from the reversal of the judgment. I concur in the result of remanding the cause for a new trial on the vicarious liability count.
SHORES, J., concurs.
SEE, Justice (dissenting as to Part I; concurring in part as to Part II; and dissenting from the order in Part II remanding for a new trial).
I respectfully dissent from Part I of the main opinion, which holds that on the evidence presented Alfa Mutual Insurance Company ("Alfa") could be held vicariously liable for the actions of Patronas in selling a non-Alfa insurance policy. I concur in Part II of the main opinion insofar as it holds that the evidence regarding Alfa's conduct did not establish wantonness. Because Alfa was entitled to a judgment as to both counts, however, I dissent from that portion of Part II of the main opinion remanding for a new trial.
This case involves Patronas's conversion of premium payments that he received for the sale of a workers' compensation pool insurance policy to be issued by the National Council on Compensation Insurance, Inc. ("NCCI").[3] The main opinion holds that Alfa is liable for Patronas's sale of NCCI policies, under Ala.Code 1975, § 6-11-27(a), because "the acts of the agent[, Patronas,]... were calculated to or did benefit the principal[, Alfa]." 723 So. 2d at 1255 (emphasis added). The main opinion interprets the word "benefit" to include indirect marketing benefits from Patronas's sale of the NCCI policy that I deem insufficient to support the imposition of vicarious liability on Alfa.
Alfa had no right to, and did not, receive or retain any of the premiums paid on the NCCI policy, or any other direct financial benefit with respect to that policy. Cf. In re Tuskegee Inst. v. May Refrigeration Co., 344 So. 2d 156, 158 (Ala.1977) (stating that a "master's" retention of a financial benefit generated by its "servant's" conduct constitutes a ratification of the servant's conduct that also subjects the master to liability for the servant's conduct). Any indirect marketing benefit Alfa might have received by allowing Patronas to contract with NCCI to sell NCCI's pool insurance policies in addition to Alfa automobile and liability policies is no greater than the benefit any casualty insurance company would receive from an independent agent's sale of noncasualty policies in addition to the company's casualty policies. This collateral advantage derived from a policy Alfa did not issue and from premiums it did not collect is too remote, too indefinite, and too speculative a benefit on which to premise Alfa's vicarious liability under § 6-11-27(a).
The plaintiffs quite properly seek relief against Patronas, who pocketed their premiums. There may well have been an unmet responsibility on the part of NCCI to monitor the sale of its policy. But, the plaintiffs fail to demonstrate that Alfa benefited from the alleged wrong.
HOOPER, C.J., concurs.
[1] This case was tried before the amendment of Rule 50, Ala. R. Civ. P., effective October 1, 1995, which renames the "motion for directed verdict" as a "motion for judgment as a matter of law," and renames the "motion for judgment notwithstanding the verdict" as a "renewal of the motion for a judgment as a matter of law." See Committee Comments to October 1, 1995, Amendment to Rule 50.
[2] Alfa's field procedure manual contains a detailed system for controlling, monitoring, and auditing the manner in which its agents handle Alfa money. The agent, the customer service representative, and the secretary in every Alfa office are required to keep a detailed daily account of Alfa receipts and transactions, and Alfa had a system of audits in place to discover fraud, misconduct, or theft on the part of an agent.
[3] NCCI, not Alfa, had the responsibility to monitor the sale of the workers' compensation policies. | 6fe0d2f044a783e16472cfda544b060ec9256d27acc068f94350e5f9a4d75d76 | 1998-09-11 00:00:00 |
f2a2e4dd-b9c9-4a90-8963-2946b9038d1a | HM v. Jefferson County Bd. of Educ. | 719 So. 2d 793 | 1961607 | Alabama | Alabama Supreme Court | 719 So. 2d 793 (1998)
H.M. and M.M.
v.
JEFFERSON COUNTY BOARD OF EDUCATION.
1961607.
Supreme Court of Alabama.
July 17, 1998.
*794 Wendy Brooks Crew and Jeffrey P. Mauro of Baddley & Crew, P.C., Birmingham, for appellants.
Carl Johnson and Whit Colvin of Bishop, Colvin, Johnson & Kent, Birmingham, for appellee.
MADDOX, Justice.
This case concerns whether a school board can be held liable under Title IX of the Education Amendments of 1972, § 909, as amended, 20 U.S.C. §§ 1681-1688, for a male teacher's alleged sexual harassment of one of his male students.
The trial court entered a summary judgment in favor of the school board. The facts of this case are strikingly similar to the facts in Gebser v. Lago Vista Independent School District, ___ U.S. ___, 118 S. Ct. 1989, 141 L. Ed. 2d 277 (1998). In that case, the United States Supreme Court held in favor of the defendant school district because there was no showing that the school district had received actual notice of the alleged sexual misconduct and after receiving it had demonstrated deliberate indifference to that misconduct. We believe that Gebser controls the resolution of this case; we therefore affirm the judgment of the trial court.
H.M. and M.M. filed a complaint on their own behalf and on behalf of their minor son against the Jefferson County Board of Education (the "Board"), and one of its teachers, Jerry Dale Talbot, alleging that Talbot, their son's teacher and coach, had sexually harassed and abused him over a four-year period while he was a student in one of the Board's schools.
The plaintiffs initially claimed that the Board should be held liable on the basis that it had negligently hired Talbot, or had failed to properly supervise him, but they later amended their complaint to assert a claim for damages under Title IX of the Education Amendments of 1972. The trial court entered a summary judgment for the Board on all of the claims against it.
On appeal, the plaintiffs do not challenge the summary judgment as to their state tort claims, but they do claim that the summary judgment was improper as to their Title IX claims against the Board.[1]
For purposes of this appeal, there are several undisputed facts. First, the Board does not dispute that Jerry Talbot engaged in sexual misconduct toward the plaintiffs' son while the son was a student at one of the Board's schools. Instead, the Board argues that, even assuming that Talbot sexually harassed the plaintiffs' son, it should not be held liable under Title IX for this misconduct. To support this argument, the Board notes that it is undisputed that when the plaintiffs' son reported the harassment to one of his other teachers: (1) that teacher immediately reported the harassment to the school administration; (2) the Board promptly investigated the claim; and (3) the Board placed Talbot on leave and initiated termination proceedings against him. In addition, the Board also notified local law enforcement authorities about the incident.[2]
*795 The plaintiffs base their Title IX claim on three theories: (1) that Talbot required their son, as a quid pro quo, to submit to sexual advances in exchange for permission to participate in school-sponsored athletics; (2) that Talbot's actions created a hostile educational environment; and (3) that the Board failed to comply with the requirements of Title IX regarding the implementation, publication, and dissemination of an acceptable sexual harassment/abuse policy and grievance procedure and that that failure would make the Board liable.
Title IX prohibits educational institutions that receive federal assistance from discriminating on the basis of sex. 20 U.S.C. § 1681 (1990). To state a cause of action under Title IX, a plaintiff must show: (1) that he or she was excluded from participation in, was denied benefits of, or was subjected to discrimination in, an educational program; (2) that the program receives federal assistance; and (3) that the exclusion, denial, or discrimination was on the basis of sex. Seamons v. Snow, 84 F.3d 1226 (10th Cir.1996).
In Franklin v. Gwinnett County Public Schools, 503 U.S. 60, 112 S. Ct. 1028, 117 L. Ed. 2d 208 (1992), the United States Supreme Court held that a teacher's sexual abuse against a student could constitute discrimination on the basis of sex and that private litigants could use Title IX to recover monetary damages for a teacher's sexual abuse of a student. Therefore, there seems to be little doubt that Title IX encompasses claims based on a teacher's sexual harassment of a student. See, e.g., Gebser v. Lago Vista Independent School District, supra; Smith v. Metropolitan School District of Perry Township, 128 F.3d 1014, 1021 (7th Cir.1997); Davis v. Monroe County Board of Education, 120 F.3d 1390, 1400 n. 14 (11th Cir.1997) ("[w]e assume that Franklin created a cause of action for teacher-student sexual harassment under Title IX").
Nevertheless, the Board contends that the plaintiffs failed to state a cause of action under Title IX because, it argues, they failed to demonstrate that the sexual misconduct directed toward their son amounted to the kind of sex discrimination that Title IX was adopted to curb or prevent. The Board asserts that Title IX prohibits only discrimination on the basis of sex and that this prohibition denotes a particular species of unlawful conduct: gender-based mistreatment. The Board asserts that because this case involves a male teacher and a male student, the plaintiffs have no claim under Title IX.
The Board relies primarily on cases in which the United States Court of Appeals for the Fifth Circuit ruled that discrimination on the basis of sex does not encompass sexual impropriety or activity between members of the same sex. See Garcia v. Elf Atochem North America, 28 F.3d 446 (5th Cir.1994) (harassment by male supervisor against male subordinate does not state claim under Title VII). We cannot agree with the Board. The United States Supreme Court's recent case of Oncale v. Sundowner Offshore Services, Inc., ___ U.S. ___, ___, 118 S. Ct. 998, 1000, 140 L. Ed. 2d 201 (1998), presented "the question whether workplace harassment can violate Title VII's prohibition against `discriminat[ion]... because of ... sex,' 42 U.S.C. § 2000e-2(a)(1), when the harasser and the harassed employee are of the same sex." The Supreme Court specifically held "that nothing in Title VII necessarily bars a claim of discrimination `because of ... sex' merely because the plaintiff and the defendant (or the person charged with acting on behalf of the defendant) are of the same sex." Id., ___ U.S. at ___, 118 S. Ct. at 1001-02. We believe that the Supreme Court's Oncale definition of "discrimination on the basis of sex" demonstrates that same-sex harassment may constitute discrimination on the basis of sex and that such discrimination is, therefore, actionable under Title IX, provided, of course, a plaintiff proves the remaining statutory factors. See Kinman v. Omaha Public School District, 94 F.3d 463, 468 (8th Cir. 1996).
We now address the appropriate standard of liability to be applied under Title IX to determine whether the Board should be held liable for the sexual misconduct alleged in this case. Until recently, this standard was unclear because the federal courts of appeals had adopted a variety of approaches for assessing whether a school district was liable for a teacher's harassment of a student. Cf. Nelson v. Almont Community Schools, 931 F. Supp. 1345, 1355 (E.D.Mich.1996) (applying the intentional-discrimination standard governing claims brought under Title VI of the Civil Rights Act of 1964); Kracunas v. Iona College, 119 F.3d 80, 82 (2d Cir.1997) (applying the agency-like principles developed under Title VII); and Doe v. Lago Vista Independent School District, 106 F.3d 1223 (5th Cir.1997) (holding that a school district could be held liable for a teacher's sexual harassment of a student only if a school official who had actual knowledge of the abuse was invested by the school board with the duty to supervise the offending employee and the power to take action that would end such abuse and had failed to do so).
However, in Gebser v. Lago Vista Independent School District, the United States Supreme Court clarified the standard of liability to be applied in cases such as this one. The Court specifically held that damages may not be recovered from a school district based on the sexual harassment of a student by one of its teachers "unless an official of the school district who at a minimum has authority to institute corrective measures on the district's behalf has actual notice of, and is deliberately indifferent to, the teacher's misconduct." ___ U.S. at ___, 118 S. Ct. at 1993.
It is not difficult to apply Gebser to this case. It is undisputed that until the plaintiffs' son reported the harassment no Board official with supervisory authority knew of Talbot's alleged sexual harassment and that, once the Board learned of the misconduct, it took prompt action to correct it and to prevent it from occurring in the future. Accordingly, we conclude that the trial court properly entered the summary judgment for the Board.
We note that the plaintiffs contend that the Board should be held liable under Title IX because, they argue, it failed to comply with the procedural and administrative requirements of Title IX. Specifically, they argue that the Board may be held liable on the basis that it had failed to promulgate and enforce an adequate grievance procedure or otherwise maintain an adequate policy with regard to sexual harassment. However, this argument was expressly rejected by the United States Supreme Court in Gebser. See Gebser, ___ U.S. at ___, 118 S. Ct. at 1992 ("[The school district's] alleged failure to comply with the [administrative] regulations, however, does not establish the requisite actual notice and deliberate indifference. And in any event, the failure to promulgate a grievance procedure does not itself constitute `discrimination' under Title IX."); see also Seamons v. Snow, 84 F.3d 1226, 1233 (10th Cir.1996); Bougher v. University of Pittsburgh, 713 F. Supp. 139 (W.D.Pa.1989), aff'd, 882 F.2d 74 (3d Cir.1989) (simply alleging that a university did not have a grievance procedure in place was not sufficient to state a claim for relief).
The summary judgment in favor of the Board is affirmed.
AFFIRMED.
HOOPER, C.J., and ALMON, SHORES, HOUSTON, KENNEDY, COOK, SEE, and LYONS, JJ., concur.
[1] Their claims against Jerry Talbot are still pending in the trial court. In entering the Board's summary judgment, the trial court specifically stated that it was not ruling on the claims against Talbot, and it made the Board's summary judgment final pursuant to Rule 54(b), Ala. R. Civ. P.
[2] Upon receiving notice of the termination proceedings, Talbot resigned; he ultimately pleaded guilty and was convicted of sexually assaulting and sodomizing the plaintiffs' son. | 7ff9a452d3f9b1d2e7fc083e9e5721e5beb37fbd91c32cd0437813ef0385a7be | 1998-07-17 00:00:00 |
f66784c9-7caa-4ae2-afbb-ea93ff8f1952 | Ex Parte Burgess | 723 So. 2d 770 | 1970146 | Alabama | Alabama Supreme Court | 723 So. 2d 770 (1998)
Ex parte Alonzo Lydell BURGESS.
(Re Alonzo Lydell Burgess v. State).
1970146.
Supreme Court of Alabama.
August 28, 1998.
Rehearing Denied October 23, 1998.
*771 Ellen L. Wiesner of Equal Justice Initiative of Alabama, Montgomery, for petitioner.
Bill Pryor, atty. gen., and Michael B. Billingsley, asst. atty. gen., for respondent.
ALMON, Justice.
Alonzo Lydell Burgess petitioned for a writ of certiorari to the Court of Criminal Appeals, which had affirmed his conviction and death sentence on one count of murder made capital by his killing three people pursuant to one scheme or course of conduct. See Ala.Code 1975, § 13A-5-40(a)(10). This Court issued the writ of certiorari as a matter of right, pursuant to Ala.R.App.P. 39(c).
We have carefully reviewed all of the issues presented in the petition, the briefs, and oral argument. With one exception, all of the issues now raised by Burgess were addressed by the Court of Criminal Appeals. See Burgess v. State, 723 So. 2d 742 (Ala. Crim.App.1997). The single issue not addressed by the Court of Criminal Appeals whether the imposition of the death penalty constitutes cruel and unusual punishment lacks merit. "The United States Supreme Court has held that the penalty of death, if constitutionally applied, does not constitute cruel and unusual punishment." Ex parte Harrell, 470 So. 2d 1309, 1317 (Ala.1985), cert. denied, 474 U.S. 935, 106 S. Ct. 269, 88 L. Ed. 2d 276 (1985) (citing Gregg v. Georgia, 428 U.S. 153, 96 S. Ct. 2909, 49 L. Ed. 2d 859 (1976)).
In its opinion, the Court of Criminal Appeals stated that "no plain error occurs when the trial court instructs the jury in accordance with ... pattern jury instructions." 723 So. 2d at 758. However, that statement is not entirely accurate, in light of Ex parte Wood, 715 So. 2d 819 (Ala.1998), in which this Court held that following the pattern jury instructions does not necessarily foreclose error. Nonetheless, there is no cause for a reversal in this case, because the Court of Criminal Appeals did not base its affirmance of Burgess's conviction and sentence on the premise that reciting pattern instructions cannot give rise to error. We have read the circuit court's jury charge and do not find reversible error.
The Court of Criminal Appeals also addressed an apparent issue of first impression. In sentencing Burgess to death, the circuit court found, as an aggravating circumstance, that Burgess had committed the murders in this case while he was "under sentence of imprisonment," within the meaning of Ala.Code 1975, § 13A-5-49(1). The "sentence of imprisonment" that Burgess was under at the time of the murders was a two-year suspended sentence he had received for violating a municipal ordinance. More particularly, he had, less than a year before committing capital murder, been convicted of making harassing communicationssee generally, *772 Ala.Code 1975, § 13A-11-8(b)directed toward the mother and grandmother of the victims in this case.
Burgess argues that the legislature could not have intended that his being under a suspended sentence for violating a municipal ordinance would support the finding of an aggravating circumstance under § 13A-5-49(1). The Court of Criminal Appeals rejected that argument, noting that the term "sentence of imprisonment," as defined in § 13A-5-39(7), specifically includes suspended sentences, and stating that that section "does not exclude from its scope any category of criminal violation." 723 So. 2d at 766. Thus, the court held that, given the facts of this case, the circuit court did not err by finding the existence of a § 13A-5-49(1) aggravating circumstance. Further, the Court of Criminal Appeals held that, in deciding whether to impose the death penalty, "the sentencer is free to assign [such an aggravating circumstance] great weight or no weight at all." 723 So. 2d at 767.
The relevant statutes do not appear to exclude the use of a sentence for a municipal violation as an aggravating circumstance. In assigning weight to such an aggravating circumstance, however, the sentencing court should keep in mind the gravity and relevance of the underlying offense.
Carr v. State, 640 So. 2d 1064, 1074 (Ala.Crim. App.1994) (quoting Murry v. State, 455 So. 2d 53, 66-67 (Ala.Crim.App.1983), rev'd on other grounds, 455 So. 2d 72 (Ala.1984)) (emphasis added). Accordingly, in capital cases in which an aggravating circumstance is found to exist, on the basis of the defendant's having been under a sentence of imprisonment for violating a municipal ordinance that involved the commission of a relatively minor crime, that aggravating circumstance should generally be given little weight.
In particular instances, however, an aggravating circumstance that is found to exist based on a sentence for a municipal conviction might be afforded more weight. The circumstance would have particular relevance, for example, when the defendant was under a sentence of imprisonment for already having committed a crime against a person whom he later murdered. Such a consideration is present here, because Burgess's municipal conviction was for harassing communications directed at his murder victims' mother and grandmother. Burgess mentioned his bad relationship with the victims' mother and grandmother as one reason for committing the murders in this case. Thus, his conviction for a municipal violation was relevant to his conviction for capital murder, and his being under a sentence for that conviction was indeed an aggravating circumstance to which the circuit court could have attributed some weight.
The fact that Burgess was under a sentence for his municipal conviction was not the only aggravating circumstance the circuit court considered in imposing the death penalty. Burgess had previously been convicted of two counts of kidnapping, and his convictions on those offenses qualified as aggravating circumstances under Ala.Code 1975, § 13A-5-49(2), because they constituted prior convictions for felonies "involving the use or threat of violence to the person." These prior felony convictions provide weighty aggravating circumstances supporting Burgess's death sentence. Consequently, the fact that he was under a suspended sentence for a municipal conviction need not be given undue weight in order to sustain Burgess's death sentence.
No error resulted from Burgess's being absent, without his attorney's objecting, for two brief periods during procedural discussions. Ex parte DeBruce, 651 So. 2d 624 (Ala.1994).
We have studied the record in this case, and we find no error, in either the guilt phase or the sentencing phase of Burgess's trial, that would warrant a reversal of his conviction or sentence. Although all of the Justices do not necessarily approve of all the *773 reasoning in the opinion of the Court of Criminal Appeals, that court reached the correct result. Therefore, we affirm the judgment of the Court of Criminal Appeals.
AFFIRMED.
HOOPER, C.J., and MADDOX, SHORES, HOUSTON, COOK, and SEE, JJ., concur. | ba49d8c5bf93df968ff39879fedf7c7fefd371c780de87ba2a5a4fd24994da9f | 1998-08-28 00:00:00 |
d3bf38db-717a-424b-baad-c2ddeb450b5c | Ex Parte Frazier | 729 So. 2d 253 | 1962041 | Alabama | Alabama Supreme Court | 729 So. 2d 253 (1998)
Ex parte Roger Dale FRAZIER.
(Re Roger Dale Frazier, alias v. State).
No. 1962041.
Supreme Court of Alabama.
July 31, 1998.
*254 D. William Rooks, Birmingham, for petitioner.
Bill Pryor, atty. gen., and James B. Prude, asst. atty. gen., for respondent.
ALMON, Justice.
Roger Dale Frazier was arrested and subsequently indicted for two counts of first-degree robbery in violation of Ala. Code 1975, § 13A-8-41. On one count, the jury convicted him of first-degree robbery and on the other count it convicted him of the lesser-included offense of second-degree robbery. See Ala.Code 1975, § 13A-8-42. The circuit court sentenced Frazier under the Habitual Felony Offender Act to life imprisonment without parole on the first-degree robbery conviction, and to life imprisonment on the second-degree robbery conviction. The Court of Criminal Appeals affirmed Frazier's convictions, with an unpublished memorandum. Frazier v. State, 717 So. 2d 896 (Ala. Crim.App.1997) (table).
In his petition for certiorari review, Frazier alleged that his constitutional rights were violated when the circuit court allowed a State's witness to identify Frazier in court as one of the three men who committed the crimes for which he was charged. Frazier argued in his petition, as he had before the Court of Criminal Appeals, that the witness's identification was tainted by an unnecessarily suggestive pretrial one-man showup, and that the circuit court should therefore have suppressed the witness's identification from evidence. The appeals court rejected Frazier's argument, concluding that the witness's identification satisfied the five criteria for reliability set out in Neil v. Biggers, 409 U.S. 188, 93 S. Ct. 375, 34 L. Ed. 2d 401 (1972). However, the decision of the Court of Criminal Appeals provided no analysis of the particular facts of Frazier's case, and this Court granted certiorari review to determine whether the record shows that the witness's in-court identification was indeed reliable under the Neil v. Biggers test.
The United States Supreme Court has long recognized that the practice of showing a suspect singly for purposes of identification "has been widely condemned" as being unnecessarily suggestive and conducive to irreparable mistaken identifications that constitute a denial of due process. Manson v. Brathwaite, 432 U.S. 98, 104, 97 S. Ct. 2243, 2248, 53 L. Ed. 2d 140, 147 (1977) (quoting Stovall v. Denno, 388 U.S. 293, 302, 87 S. Ct. 1967, 1972, 18 L. Ed. 2d 1199, 1206 (1967)). In United States v. Wade, 388 U.S. 218, 87 S. Ct. 1926, 18 L. Ed. 2d 1149 (1967), the Supreme Court sharply criticized suggestive pretrial identifications, such as one-man showups, calling them "[a] major factor contributing to the high incidence of miscarriage of justice from mistaken identification":
Wade, 388 U.S. at 228-29, 87 S. Ct. at 1933, 18 L. Ed. 2d at 1158-59 (citations omitted).
The danger inherent in a one-man showup, where a witness is shown a single suspect and asked, "Is that the man?" is twofold. First, a one-man showup conveys a clear message that "the police suspect this man." Williams v. State, 546 So. 2d 705, 706 (Ala.Crim.App.1989) (quoting Biggers v. Tennessee, 390 U.S. 404, 407, 88 S. Ct. 979, 981, 19 L. Ed. 2d 1267, 1269 (1968) (Douglas, J., dissenting) (emphasis in original)). Second, a one-man showup does not give the witness a choice of identifying any other person as being the perpetrator of the crime charged. See Brazell v. State, 369 So. 2d 25 (Ala.Crim. App.1978), cert. denied, 369 So. 2d 31 (Ala. 1979). Consequently, when a one-man showup is used to identify the perpetrator of a crime, the reliability of the witness's identification is not put to an objective test, such as a live or photographic lineup, in which a single suspect must be chosen from a group of persons possessing similar physical characteristics.
Undisputedly, the pretrial identification of Frazier was the linchpin of the State's case against him. However, the method used to secure that identificationthat is, a one-man showupcalls into question the reliability of the identification itself. If the circuit court allowed the State to use an inherently unreliable identification to secure Frazier's robbery convictions, then his right to due process was violated. If that is the case, then Frazier's convictions are due to be reversed.
Shortly before 12:50 a.m. on July 28, 1994, Kimberly Howard and Kristie Richardson were leaving a nightclub known as Charlie's Go-Go, where they worked as dancers, in Jefferson County. They were accompanied by Jerry Lamar Metcalf, who was Richardson's boyfriend at the time. It was Howard's birthday, and she had wanted to leave because she was upset over having just lost a dance contest inside the nightclub. When the three reached Howard's car in the parking lot of the nightclub, Howard, who was crying, got into her car and sat in the front seat. Richardson and Metcalf stood beside the vehicle and talked with Howard, attempting to console her. Momentarily, Richardson left Howard and Metcalf and went back toward the nightclub to retrieve Howard's birthday cake, which they had left inside.
Richardson testified that just before she left Howard's car to return to the building she saw a "dark color car, like a red" enter the parking lot. She further testified that there were three black men in the car, and that there was also a fan in the back seat. Although she could not describe the two passengers in the car, Richardson testified that she got a good look at the driver. However, Richardson later testified that she was initially unsure of the car's color because, she said, "I had only got a glimpse of it."[1]
Howard and Metcalf testified that while they were in the parking lot, an older, reddish-colored car pulled behind Howard's vehicle and two black men stepped out. They stated that the two men went to a pay telephone near Howard's car; that one of them picked up the receiver of the telephone for a couple of seconds and then slammed it down; and that then they both drew pistols and pointed them at Howard and Metcalf. Howard and Metcalf said the two men proceeded to rob them at gunpoint, while the driver of the robbers' car remained in the vehicle. Neither Howard nor Metcalf actually saw the driver of the car, however, and Metcalf testified, regarding the driver, only that the driver's voice sounded like that of a man in his 30s or upper 30s.
*256 After Howard told one of the robbers that they were being videotaped by the nightclub's security camera,[2] both robbers quickly returned to the vehicle in which they had arrived, and the vehicle left the parking lot. Howard then ran inside Charlie's Go-Go, screaming that she had just been robbed. Seeing Howard return, Richardson dropped Howard's birthday cake and left the nightclub to find out what had happened to Metcalf. Richardson testified that when she went outside she saw the same red car, which she had seen only a few minutes earlier, leaving the nightclub's parking lot and driving away. Outside, Richardson also found Metcalf, who was unharmed.
About 15 minutes later, a deputy from the Jefferson County Sheriff's Department responded to a call reporting the robbery. The deputy interviewed Howard, Metcalf, and Richardson, and he then completed an incident report. In that report, the deputy indicated that Howard had described the robbers' vehicle as being a brown and tan station wagon. In addition, despite the fact that Richardson testified that she told the deputy on the scene that the car she saw was dark-colored, and possibly was red, and that there was a fan inside the vehicle, nothing to that effect was reflected in the deputy's incident report. Similarly, even though Richardson later stated that she told the deputy that the driver of the car was a tall, black male who was in his 30s and who weighed approximately 160 pounds, that information was not included in the incident report. Likewise, while Metcalf stated at trial that he had described the robbers' vehicle as appearing rust-colored, his description of the car was not noted in the deputy's report. Finally, the deputy's report indicated that a fourth witness, Ronald Darty, saw the robbers' vehicle leaving the parking lot of the nightclub. Despite this, the report did not show that Darty ever gave a description of the vehicle.
Within hours after the robbery at Charlie's Go-Go, Frazier was arrested by Birmingham police and was placed in the custody of the Jefferson County Sheriff's Department.[3] Although Frazier was not driving the vehicle at the time of his arrest, he stated that he had been driving his mother's red 1967 Chevrolet Impala automobile earlier that night. Law enforcement authorities subsequently impounded the Impala, and a search revealed a fan and a .32-caliber revolver in the vehicle. Although Howard testified at trial that one of the robbers had used a revolver, she could not say for certain that the .32-caliber pistol found in Frazier's mother's car was in fact used in the robbery.[4] Moreover, no one was with Frazier at the time of his arrest,[5] and law enforcement authorities did not discover in his mother's vehicle any of the possessions that had been stolen from Howard and Metcalf earlier that morning.
*257 After Howard, Metcalf, and Richardson left Charlie's Go-Go, they went to the Jefferson County Sheriffs Department to give further statements regarding the robbery. When they arrived, they saw the Impala belonging to Frazier's mother; it had just been impounded. When a sheriffs investigator showed them the Impala, a fan was visible in the back seat. Howard and Richardson positively identified the Impala as being the car that was used in the robbery. Metcalf said that the vehicle was probably the same car, but that he could not make a positive identification because he had seen the robbers' vehicle only out of the corner of his eye. Ronald Darty, who had also seen the vehicle used in the robberies, was apparently not asked to identify the car belonging to Frazier's mother, and the State did not call him as a witness against Frazier.
Sometime between 4:00 and 5:20 a.m., a sheriffs investigator took Richardson to view Frazier through a two-way mirror; the investigator asked her if Frazier was the man she had seen driving into the parking lot of Charlie's GoGo just before the robbery. At the time, Frazier was handcuffed and was seated alone in a small, brightly lit polygraph room in the sheriffs department. Before showing her Frazier alone behind the two-way mirror, the sheriffs investigator did not ask Richardson to identify Frazier in either a lineup or a photographic array. After seeing Frazier in the one-man showup, Richardson stated that Frazier was indeed the man she had seen driving the car into the parking lot of Charlie's Go-Go shortly before the robbery took place.
It would be mere sophistry to argue that the one-man showup used to secure Richardson's identification of Frazier was not unnecessarily suggestive. See Brazell at 29. The record tends to show, and the State has not refuted, that there were no exigent circumstances requiring that Frazier be immediately identified by Richardson. Frazier was not apprehended in direct flight from committing a crime, and Richardson's identification of him was not made at or near the scene of the robbery. See Bates v. United States, 405 F.2d 1104 (D.C.Cir.1968); Hobbs v. State, 401 So. 2d 276 (Ala.Crim.App.1981). Also, Richardson's life was in no peril that would have required her to identify Frazier immediately. See Stovall, supra. Furthermore, the record suggests no reason why the sheriffs investigator could not have asked Richardson to identify Frazier in a lineup or from a photographic array rather than in a suggestive one-man showup. The investigator testified that the sheriffs department, where Richardson identified Frazier, was directly across the street from the county jail, where lineups were usually held during criminal investigations conducted by the sheriffs department. Similarly, the investigator testified that he had had an opportunity to photograph Frazier before Richardson was asked to identify him, but no one attempted to assemble a photographic array for her.
However, even though the one-man showup used to secure Richardson's identification of Frazier was unnecessarily suggestive, "admission of evidence of a showup without more does not violate due process." Manson, 432 U.S. at 106, 97 S. Ct. at 2249, 53 L. Ed. 2d at 148 (quoting Neil v. Biggers, 409 U.S. at 198, 93 S. Ct. at 382, 34 L.Ed.2d at 411). Rather, the determination of whether a pretrial showup in fact violates the due process requirement turns on "the central question [of] whether under the `totality of the circumstances' the identification was reliable even though the confrontation procedure was suggestive." Neil v. Biggers, 409 U.S. at 199, 93 S. Ct. at 382, 34 L. Ed. 2d at 411. The factors to be considered in evaluating the likelihood of misidentification, as set out in Neil v. Biggers and reaffirmed in Manson, include "the opportunity of the witness to view the criminal at the time of the crime, the witness' degree of attention, the accuracy of the witness' prior description of the criminal, the level of certainty demonstrated by the witness at the confrontation, and the length of time between the crime and the confrontation." Neil v. Biggers, 409 U.S. at 199-200, 93 S. Ct. at 382, 34 L. Ed. 2d at 411; Manson, 432 U.S. at 114, 97 S. Ct. at 2253, 53 L. Ed. 2d at 154.
It is undisputed that Richardson had absolutely no opportunity, during the course of the robbery, to view the men who robbed Howard and Metcalf. However, Richardson *258 testified that she saw a car, allegedly driven by Frazier, enter the parking lot of Charlie's Go-Go shortly before the robbery and leave immediately thereafter. According to Richardson's testimony, she saw the vehicle come into the parking lot, but it was only when the car was fairly close to her that the car came into sufficient light for her to see its occupants. The car apparently drove past Richardsonshe estimated at about five miles per hourand around the corner of the nightclub and out of her sight, not stopping the entire time Richardson was seeing it. Richardson testified that she got a good look at the driver as the car went past her, and that she would have been able to recognize the driver again based on her seeing him that night. However, Richardson also testified that she did not see either of the other two occupants of the car and that she was initially unsure of the color of the vehicle because, she said, "I had only got a glimpse of it." When Richardson saw the car immediately after the robbery, it was already leaving the parking lot of the nightclub, so she had no further opportunity to view its occupants.
Richardson testified that she turned to look at the car in the parking lot of Charlie's Go-Go because she "automatically look[ed], no matter what" when a car approached. However, she also stated that the vehicle really caught her attention only when, after it had been parked, the occupants apparently did not get out of it and enter the nightclub. Of course, by the time the car was parked it was, according to Richardson's own testimony, out of her field of view because it had already rounded the corner of the building. Thus, even though Richardson saw the vehicle as it passed by her in the parking lot, she admitted that the presence of the car did not draw her full attention until it was already past her line of sight.
Additionally, the record shows that the robbers' vehicle entered the parking lot of Charlie's Go-Go just as Richardson and Metcalf were attempting to console Howard, who was sitting in her car and crying. This set of circumstances is another factor tending to show that Richardson's attention was not fully focused on viewing the persons who were in the vehicle that she saw shortly before Howard and Metcalf were robbed.
Although at trial Richardson testified in great detail as to what she saw just before Howard and Metcalf were robbed, including giving a description of the car's driver, whom she later identified as Frazier, the record reveals little evidence as to how Richardson described the driver of the car before she saw Frazier in the one-man showup at the sheriff's department. Richardson stated only once, at trial, that she had described the driver to a sheriffs deputy at the scene. She testified that she had told the deputy that the driver of the vehicle was a black male, in his 30s, fairly tall, and weighing about 160 pounds. Aside from that testimony, the record contains nothing indicating that Richardson gave a description of the driver of the car to anyone before she saw Frazier in the one-man showup at the sheriff's department. In fact, the incident report completed by the deputy who interviewed Richardson at the scene of the robbery gives no indication that Richardson had described to the deputy the appearance of the driver. For that matter, even though Richardson said that she had also informed the deputy that the vehicle she saw was red and that it had a fan in the back seat, neither the incident report nor any other witness indicated that Richardson had so described the robbers' vehicle before she saw Frazier's mother's car after it had been impounded by the sheriffs department.
Because the record is nearly devoid of any evidence indicating how Richardson described the driver of the robbers' vehicle before she saw Frazier at the sheriffs department in a one-man showup, and because Richardson's testimony was not corroborated by other witnesses or by the information contained in the investigating deputy's incident report, this Court has little basis for gauging the accuracy of Richardson's prior identification relative to Frazier's actual physical appearance. Apparently, the only description supposedly given by Richardson before she saw Frazier that morning at the sheriffs department was that the driver of the car was a black male, fairly tall, in his 30s, and weighing about 160 pounds. Frazier was a black male, six feet and one inch *259 tall; at the time of his arrest he was 40 years old and weighed approximately 150 pounds. Therefore, Richardson's purported prior description of the driver was arguably a close approximationbut not an exact depiction of Frazier's actual appearance. However, as noted by Frazier in his brief, the generality of Richardson's description probably would have described a large number of men in Jefferson County.
And finally, pertinent to the Neil v. Biggers factors, Richardson testified that she was sure that Frazier was the man she had seen driving the car at Charlie's Go-Go, and her identification of Frazier was made between three hours and four and a half hours after the robbery.
In light of these facts, this Court's analysis of the Neil v. Biggers factors leads to these conclusions:
(1) While Richardson did have an opportunity to view the driver of the robbers' vehicle, that opportunity was a fleeting one;
(2) While Richardson noticed the robbers' car as it approached her in the parking lot of the nightclub, she did not give particular attention to the vehicle or its occupants until after it had passed from her sight, and her attention may have been diverted because she and Metcalf were attempting to console Howard;
(3) Evidence in the record regarding Richardson's describing the driver of the vehicle before she saw Frazier in a one-man showup at the sheriffs department is scant and uncorroborated. Moreover, if Richardson's description of the driver as being a black male, fairly tall, in his 30s, and weighing about 160 pounds, is accepted at face value, it is nonetheless a highly generic description and not a precise depiction of Frazier's actual appearance at the time of his arrest;
(4) Although Richardson did not state a particular reason for her certainty, she did testify that she was sure that Frazier was the man she saw driving the robbers' vehicle just before Howard and Metcalf were robbed; and
(5) Although Richardson did not identify Frazier as the driver of the robbers' car immediately after Howard and Metcalf were robbed, she did identify him within a reasonably short time thereafter.
The rule regarding the exclusion of pretrial identifications has been that evidence of a pretrial identification need not be excluded if the State can prove by clear and convincing evidence that the identification stems from a source independent of the unfair pretrial confrontation. Cargill v. State, 432 So. 2d 520 (Ala.Crim.App.1983) (citing Brazell, supra); see also Wade, supra. In this present case, however, this Court is not convinced that the State carried its burden of demonstrating that Richardson's testimony implicating Frazier as a participant in the robberies of Howard and Metcalf stemmed from a source other than the suggestive one-man showup in which Richardson identified Frazier as the driver of the robbers' vehicle. Considering that Richardson had had only a fleeting opportunity to see the driver, that she had paid particular attention to the presence of the car only after it had passed from her view, and that the scant evidence of her prior description of the driver reveals only a generic depiction, this Court concludes that the reliability of her identification of Frazier, made after she had been exposed to an unnecessarily suggestive one-man showup, is highly questionable. Therefore, this Court holds that there was "a very substantial likelihood of irreparable misidentification" in this case. Neil v. Biggers, 409 U.S. at 198, 93 S. Ct. at 381, 34 L. Ed. 2d at 410 (quoting Simmons v. United States, 390 U.S. 377, 384, 88 S. Ct. 967, 971, 19 L. Ed. 2d 1247, 1253 (1968)).
Finally, this Court notes that the likelihood that Frazier was misidentified is not mitigated by Richardson's statement that she saw a fan in the back seat of the robbers' vehicle. Even though a fan was discovered in the back seat of Frazier's mother's car, the reliability of Richardson's identification of the car itself is also questionable. As was the case with her identifying Frazier in a suggestive one-man showup, Richardson was shown Frazier's mother's car in isolation at the sheriffs department after the vehicle had been impounded. When she saw the vehicle at that time, a fan was clearly visible inside the car. Moreover, the unreliability of Richardson's *260 identification of the car is compounded by these circumstances: (1) her purported prior description of the vehicle was not included in the investigating deputy's incident report, (2) the incident report reflected that Howard, who observed the robbers' car during the robbery, had previously described it as being of a model and a color different from the model and color of the car belonging to Frazier's mother, and (3) the fact that Ronald Darty, the only witness who saw the robbers' vehicle at the nightclub and was not later asked to identify Frazier's mother's 1967 Impala after it had been impounded, did not testify at trial.
The use of an unnecessarily suggestive one-man showup resulted in a substantial likelihood that Richardson misidentified Frazier. Thus, the circuit court violated Frazier's right to due process by allowing Richardson to identify him at trial. Accordingly, the judgment of the Court of Criminal Appeals is reversed, and this cause is remanded for further proceedings consistent with this opinion.
REVERSED AND REMANDED.
HOOPER, C.J., and SHORES, KENNEDY, COOK, SEE, and LYONS, JJ., concur.
MADDOX, J., dissents.
[1] Richardson testified that the presence of a fan in the car immediately caught her attention and that it "was the first thing I saw." Later, however, Richardson stated that she had initially thought that the fan appeared to be another person in the vehicle. Similarly, Richardson testified that she did not observe the headlights of the car when she saw the vehicle in the parking lot of Charlie's Go-Go, but the record indicates that Richardson had stated previously that the car had four round headlights, which supposedly resembled those found on the defendant's vehicle. The record reveals no explanation for these apparent discrepancies.
[2] The record reveals that the nightclub did in fact have a security camera that was positioned so that it should have videotaped the entire robbery. However, the State never secured a videotape of the incident, and testimony in the record conflicts as to whether a videotape ever existed or if the tape had been automatically recorded over because no one had removed it from the security camera's recorder within 24 hours after the robbery.
[3] The details of Frazier's actual arrest are somewhat sketchy. The record is unclear as to precisely when Frazier was arrested. However, based on the testimony in the record, the time of his arrest would have to have been before 3:30 on the morning of the robbery. Also, the record contains no official report revealing the reason for Frazier's being apprehended by Birmingham police. However, a pro se motion filed by Frazier in the circuit court indicates that he was stopped by police for the offense of failing to dim his headlights.
[4] Although Howard stated that she had grabbed the barrel of her assailant's handgun during the robbery, the sheriff's department's evidence technician did not attempt to lift fingerprints from the revolver found in the vehicle belonging to Frazier's mother. At trial, a sheriff's investigator testified that the evidence technician had declined to check the handgun for fingerprints because the condition of the revolver was not conducive to lifting fingerprints.
Similarly, even though one of the two men who actually robbed Howard and Metcalf had handled the telephone outside Charlie's Go-Go, the evidence technician was unable to lift any fingerprints from the receiver of that telephone.
[5] The record also gives no indication that anyone else has been arrested, tried, or convicted for participating in the robberies of Howard and Metcalf. | 475e3afd6cd0e12898c5b531ce1f37886d1365a6772f1d2ed9cfe530a4659079 | 1998-07-31 00:00:00 |
badaa843-b69b-477b-88c1-c3f8a1506fa2 | Brilliant Homes, Ltd. v. Lind | 722 So. 2d 753 | 1970153 | Alabama | Alabama Supreme Court | 722 So. 2d 753 (1998)
BRILLIANT HOMES, LTD., d/b/a Silhouette Homes
v.
Kenneth LIND, Jr.
1970153.
Supreme Court of Alabama.
September 11, 1998.
R. Dale Wallace, Jr., David L. Selby II, and Michael L. Jackson of Wallace, Jordan, Ratliff & Brandt, L.L.C., Birmingham, for appellant.
Tom E. Ellis and Clifton S. Price II of Kracke, Thompson & Ellis, P.C., Birmingham, for appellee.
HOUSTON, Justice.
The defendant Brilliant Homes, Ltd., d/b/a Silhouette Homes, appeals from the trial court's order denying its motion to compel arbitration of claims (breach of warranty, bad faith, fraud, conspiracy to defraud) brought by the plaintiff, Kenneth Lind, Jr. We reverse and remand.
This action arose out of Lind's purchase of a mobile home manufactured by Brilliant Homes. After becoming dissatisfied with the condition of the mobile home and the efforts of Brilliant Homes to correct certain alleged defects, Lind filed this action, alleging in part as follows:
Lind did not allege that he had been fraudulently induced to sign the following arbitration agreement, which was included in one of the sales documents:
(Emphasis added.)
After carefully considering the record and the various arguments contained in the briefs, we conclude that the dispositive issue in this case is whether the broad arbitration provision set out above conferred upon the arbitrator or arbitrators the power to decide the preliminary issue of arbitrability. Based on the authority of Allstar Homes, Inc. v. Waters, 711 So. 2d 924 (Ala. 1997); Jones v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 604 So. 2d 332 (Ala.1991); and First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 115 S. Ct. 1920, 131 L. Ed. 2d 985 (1995), we hold that it did. The arbitration provision is clear, and in unmistakable terms it states that the parties agreed to submit the issue of arbitrability to arbitration. The clear language of this provision prima facie showed that the parties agreed to arbitrate the preliminary issue of arbitrability. Lind presented no evidence rebutting that prima facie showing so as to create a factual issue as to the parties' intent. When there is no genuine issue of fact concerning the formation of an agreement to arbitrate, the court may decide, as a matter of law, that the parties did or did not enter into such an agreement. Allstar Homes, supra.
REVERSED AND REMANDED.
HOOPER, C.J., concurs.
MADDOX, SEE, and LYONS, JJ., concur in the result.
ALMON, SHORES, KENNEDY, and COOK, JJ., dissent.
LYONS, Justice (concurring in the result).
I concur in the reversal of the trial court's order denying the defendant's motion to compel arbitration. I write specially to elaborate upon the rule of Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 U.S. 395, 87 S. Ct. 1801, 18 L. Ed. 2d 1270 (1967), in which the Supreme Court announced that in cases governed by the Federal Arbitration Act, 9 U.S.C. §§ 1-16,[1] issues concerning fraud in the inducement of a contract generally are *755 for the arbitrator, while claims of fraud in the inducement of an arbitration agreement itself are for the court. In the trial court, Lind's efforts to attack the arbitration clause itself were confined to a single sentence in an opposition to the motion to compel. No parallel allegation of the complaint and corroborating affidavit supports the plaintiff's theory that the arbitration agreement is unenforceable. See Jones v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 604 So. 2d 332, 337 (Ala.1991) (requiring more than averments in a complaint to defeat arbitrability). The plaintiff did not attempt to attack the agreement on grounds of unconscionability.
This case, therefore, does not present the issue whether the trial court must submit a claim of fraud in the inducement or a claim of unconscionability[2] to the arbitrator in a case where the record contains an evidentiary basis for such a claim and where the arbitration agreement provides for arbitration of the issue of arbitrability. Such authority of the arbitrator to determine its own authority may itself be an indicium of unconscionability. See the comment about the open-ended nature of such an agreement in AT & T Technologies, Inc. v. Communications Workers of America, 475 U.S. 643, 651, 106 S. Ct. 1415, 89 L. Ed. 2d 648 (1986), noted in Allstar Homes, Inc. v. Waters, 711 So. 2d 924 (Ala. 1997).
[1] The plaintiff argues that the contract containing the arbitration clause did not involve interstate commerce, but because this issue was not raised in the trial court, we do not address it on appeal. Andrews v. Merritt Oil Co., 612 So. 2d 409, 410 (Ala.1992).
[2] In my concurring opinion in Ex parte Dan Tucker Auto Sales, Inc., 718 So. 2d 33 (Ala.1998), I discussed the prospect for applying the doctrine of unconscionability to an arbitration agreement. | faa90828b053679508b32efbad11dbc8486520c1093355c433b4ac4b3a15bfd8 | 1998-09-11 00:00:00 |
959128fd-eeea-41e3-a612-d7f221b1419c | Ex Parte M & D Mechanical Contractors, Inc. | 725 So. 2d 292 | 1970694 | Alabama | Alabama Supreme Court | 725 So. 2d 292 (1998)
Ex parte M & D MECHANICAL CONTRACTORS, INC.
(In re Michael J. Hargrove
v.
M & D Mechanical Contractors, Inc.)
1970694.
Supreme Court of Alabama.
July 24, 1998.
Rehearing Denied October 16, 1998.
Nickolas J. Steles of Ashe, Tanner & Wright, P.C., Tuscumbia, for petitioner.
*293 Jimmy Alexander, John Plunk, and B. Scott Shipman of Alexander, Corder, Plunk & Baker, P.C., Athens, for respondent.
HOUSTON, Justice.
Michael Hargrove sued his employer, M & D Mechanical Contractors, Inc., and its workers' compensation carrier, Liberty Mutual Insurance Company, seeking to recover workers' compensation benefits for an injury he had sustained to his left eye in an accident that occurred during the course of his employment.[1] According to Hargrove, the injury to his left eye caused him emotional distress and caused him to suffer loss of vision in both eyes.[2] Liberty Mutual filed a motion to dismiss, which the trial court granted. The trial court held that Hargrove's "assertion that his blindness was caused by the incident at work [was] not founded on substantial evidence." The Court of Civil Appeals, in a 3-2 opinion, reversed and remanded with instructions, holding that Hargrove had presented substantial evidence "establishing a causal link between the ... on-the-job injury and his subsequent vision loss." Hargrove v. M & D Mechanical Contractors, Inc., 725 So. 2d 287 (Ala.Civ.App.1997). M & D petitioned for certiorari review, which we granted in order to determine whether the Court of Civil Appeals impermissibly reweighed the evidence in reaching its decision.
It appears that the Court of Civil Appeals examined the evidence to determine whether there was substantial evidence to support Hargrove's contentions and viewed that evidence in the light most favorable to Hargrove. The correct standard of appellate review, "in reviewing pure findings of fact" in a workers' compensation case, is to examine the evidence to determine if the trial court's findings of fact are supported by substantial evidence.[3] Ala.Code 1975, § 25-5-81(e)(2); see Ex parte Northam, 689 So. 2d 854 (Ala. 1996).
Section 25-5-1(9), Ala.Code 1975, defines "injury," for purposes of the Workers' Compensation Act. It provides that "[i]njury does not include a mental disorder or mental injury that has neither been produced nor been proximately caused by some physical injury to the body." (Emphasis added.)[4] See Ex parte Bryant, 644 So. 2d 951 (Ala.1994); see also, e.g., Nix v. Goodyear Tire & Rubber Co., 624 So. 2d 641 (Ala.Civ.App.1993) noting that although that case was governed by the pre-May 19, 1992, version of the Workers' Compensation Act, the Legislature, in adopting the May 19, 1992, revisions (see Act No. 92-537, Ala. Acts 1992), explicitly determined not to broaden coverage for mental disorders or mental injuries, and that this determination was indicated by the Legislature's inserting into § 25-5-1(9) language stating that "[i]njury does not include a mental disorder or mental injury that has neither been produced nor been proximately caused by some physical injury to the body"; and see Goolsby v. Family Dollar Stores of Alabama, Inc., 689 So. 2d 104 (Ala.Civ.App.1996).
In this case, there was live testimony from Dr. Michael Maund[5] and extensive deposition testimony from other physicians, *294 namely, Dr. Charles Ford[6] and Dr. Charles Shafer.[7] Some of this medical testimony was conflicting. Dr. Maund stated that he could not say with certainty that the physical injury Hargrove had suffered could be a part of what caused Hargrove's simulated blindness, and he testified that he would defer to a psychologist or a psychiatrist for the cause of Hargrove's psychological condition. Dr. Shafer initially diagnosed Hargrove's condition as "Munchausen's syndrome,"[8] but later changed his diagnosis to "hysterical blindness," and he further testified that there was a cause and effect relationship between Hargrove's accident and his hysterical blindness. Dr. Ford testified that Hargrove suffered from "simulated blindness"; he said this meant Hargrove was "simulating the process of being blind when he was not actually blind." According to Dr. Ford, Hargrove's work injury neither caused nor contributed to cause his simulated blindness:
Suffice it to say, without an in-depth recitation of the facts, which are adequately set out in the Court of Civil Appeals' opinion, that after thoroughly reviewing the record we find substantial evidence to support the trial court's finding that the on-the-job injury did not proximately cause Hargrove's blindness.
The judgment of the Court of Civil Appeals is reversed, and the case is remanded for further proceedings consistent with this opinion.
REVERSED AND REMANDED.
HOOPER, C.J., and MADDOX, COOK, SEE, and LYONS, JJ., concur.
ALMON, J., concurs in the result.
SHORES, J., dissents.
[1] There is no dispute that the accident occurred while Hargrove was working within the line and scope of his employment. He was spreading dirt and gravel in a ditch when some of the dirt and gravel spilled out of a backhoe and flew into his left eye and all over his legs.
[2] Hargrove had a history of problems with his right eye and had had no sight in that eye since childhood.
[3] "Substantial evidence" is "evidence of such weight and quality that fair-minded persons in the exercise of impartial judgment can reasonably infer the existence of the fact sought to be proved." Ex parte Trinity Industries, Inc., 680 So. 2d 262, 268 (Ala.1996), quoting West v. Founders Life Assurance Co. of Florida, 547 So. 2d 870, 871 (Ala.1989).
[4] We note that in Ex parte Trinity Industries, Inc., 680 So. 2d 262 (Ala.1996), the Court held that, to establish medical causation for a physical injury, which is necessary for an injury to be compensable, an employee must produce substantial evidence indicating that the exposure to the risk or conditions was a contributing cause of the injury. However, for a "mental injury" to be compensable, § 25-5-1(9) specifically requires that "physical injury" must have "produced" or "proximately caused" the mental injury.
[5] Dr. Michael Maund is an optometrist.
[6] Dr. Charles Ford is a neuropsychiatrist with 30 years' experience in diagnosing and treating "conversion disorders." According to Dr. Ford, a "conversion disorder" is a symptom in which a patient has some impairment of a sensory organ or involuntary motor function for which there is no discernible physical cause, but which is presumed to be due to some type of psychological cause; it does not have to be triggered by physical trauma, he said. Malingering and conversion, says Dr. Ford, are on a continuum and are related to one another. Dr. Ford's testimony was based on an examination that consisted of reviewing the results of a battery of psychological tests administered to Hargrove and on a clinical interview with Hargrove.
[7] Dr. Charles Shafer is a psychiatrist.
[8] Dr. Shafer described Munchausen's syndrome as "a factitious illness or syndrome where people malinger or produce physical illnesses or physical symptoms for a psychological gain." | d6310a34517b13869ae2fa4845f802cfe91f4b6e66e2f66b2da8b1c299237fdf | 1998-07-24 00:00:00 |
89bd459c-9066-455f-addd-b84df36aaad3 | Axelroth v. Health Partners of Alabama | 720 So. 2d 880 | 1961349 | Alabama | Alabama Supreme Court | 720 So. 2d 880 (1998)
Alan B. AXELROTH
v.
HEALTH PARTNERS OF ALABAMA, INC.
1961349.
Supreme Court of Alabama.
July 24, 1998.
*881 Andrew P. Campbell and Charles M. Elmer of Campbell & Waller, L.L.C., Birmingham, for appellant.
Randal H. Sellers and Joe L. Leak of Starnes & Atchison, Birmingham, for appellee.
HOUSTON, Justice.
The plaintiff, Alan B. Axelroth, D.P.M., a licensed podiatrist practicing in Jasper, appeals from a summary judgment for the defendant, Health Partners of Alabama, Inc. ("Health Partners"), a state-licensed health maintenance organization ("HMO") owned by Baptist Medical Centers. Axelroth sought compensatory and punitive damages, as well as injunctive relief, based on allegations that Health Partners had violated Ala.Code 1975, § 27-1-19, by refusing to reimburse him for services he had provided to one of his patients, and that Health Partners had intentionally interfered with his practice by falsely telling other patients and potential patients who where also covered by Health Partners that they were not covered for podiatric services. We affirm.
The summary judgment was appropriate if there was no genuine issue of material fact and Health Partners was entitled to a judgment as a matter of law. Rule 56, Ala.R.Civ.P. The burden was on Health Partners to make a prima facie showing that no genuine issue of material fact existed and that it was entitled to a judgment as a matter of law. If it made that showing, then the burden shifted to Axelroth to present evidence creating a genuine issue of material fact, so as to avoid the entry of a judgment against him. In determining whether there was a genuine issue of material fact, we must view the evidence in the light most favorable to Axelroth and resolve all reasonable doubts against Health Partners. Broadus v. Essex Ins. Co., 621 So. 2d 258 (Ala.1993).
The following material facts are undisputed: Health Partners was established under Ala.Code 1975, § 27-21A-1 et seq., for the purpose of providing or arranging for health care on a prepaid basis. In 1994 Health Partners obtained contracts to provide health care services to employees of Walker County and the City of Jasper. At that time, Health Partners was in the process of establishing certain credentialing standards for podiatrists and was soliciting from the Alabama Department of Public Health approval of a proposed provider contract for podiatrists; it did not recognize podiatry (involving the diagnosis and treatment of ailments of the human foot) as a covered service under the city and county plans and, therefore, it had no podiatrists participating in those plans. The record indicates that because podiatrists perform in-office surgery it was important to Health Partners to have a procedure for screening podiatrists before accepting them as participating providers. Health Partners' contracts with the city and the county each incorporated a certificate of coverage applicable to the employee members of the plans. Each of the certificates contained a schedule of benefits, which stated in pertinent part:
Under the "Exclusions" section of the certificates, the following provision appears:
"Routine foot care" was expressly excluded under this section. The following provision appears in the "Limitations" section of the certificates:
Each of the benefits schedules was amended by a "Non-Participating Provider Rider" attached to the certificate of coverage. The rider provided in pertinent part:
Dr. Robert C. Osburne, Health Partners' medical director in charge of overseeing medical management, medical policy, and credentialing, testified by deposition with respect to the process under the city and county plans for obtaining coverage for nonparticipating-provider services:
As the contractual provisions quoted above indicate, nonroutine foot care was a scheduled benefit under the city and county plans. Vanessa Adams, a former manager of health services with Health Partners, testified by deposition that it was "possible" under the terms of the certificates of coverage applicable to the city and county for nonroutine foot care to be provided to plan members by a duly licensed podiatrist; podiatric services were not excluded under the terms of the certificate of coverage. However, such services were covered only if a plan member obtained a referral from his or her primary care physician and received treatment from a participating podiatrist (of which there were *883 none) or from a nonparticipating podiatrist authorized by Health Partners.
Health Partners informed employees of the city and the county that it would not authorize referrals for podiatric services, and on a number of occasions it refused to authorize the referral of plan members to Axelroth for nonroutine foot care. Health Partners would authorize treatment for nonroutine foot care by an orthopedic surgeon. One of Axelroth's patients, Janice Williams, received treatment by Axelroth after being referred by her primary care physician. The record does not indicate that Williams obtained from Health Partners an authorization for that referral; Health Partners refused to pay Axelroth's bill. Health Partners began accepting applications for podiatrists in July 1995, and Axelroth became a participating provider under the city and county plans in 1996.
Axelroth's statutory and common-law claims are both based on allegations that his services were covered under Health Partners' contracts with the city and the county and that he lost patients before he became a participating provider, as a result of Health Partners' refusal to authorize referrals of plan members to him or to pay him for services he rendered to plan members. Axelroth's statutory claim is based on § 27-1-19 (Ala. Acts 1994, No. 94-638), which provides in pertinent part:
Axelroth contends that this section, which is part of the Alabama Insurance Code (Title 27), requires HMOs to reimburse, within a specified time, all health care providers, even nonparticipating providers, for their performance of covered services. He also contends that § 27-1-19 requires HMOs to honor all assignments of benefits, notwithstanding any terms of the health plans to the contrary. Relying on § 27-21A-23 (Ala. Acts 1986, No. 86-471), Health Partners argues that § 27-1-19 is not applicable to HMOs. Section 27-21A-23 provides:
There is no provision in Chapter 21A that is comparable to § 27-1-19.
Recently, in Blue Cross & Blue Shield of Alabama, Inc. v. Nielsen, 714 So. 2d 293 (Ala. 1998), this Court, responding to a certified question from the United States Court of Appeals for the Eleventh Circuit, held that § 27-1-19 did not apply to Blue Cross, a special purpose nonprofit corporation organized under the provisions of Ala.Code 1975, § 10-4-100 et seq. Our holding in that case was based on the plain language of two Code sections, § 10-4-115 and § 27-1-4, both of which stated that laws appearing in the Alabama Insurance Code did not apply to companies like Blue Cross unless § 10-4-100 et seq. expressly provided that such laws would apply. Noting the similarities between the issue in that case and the one here, Health Partners argues that the same reasoning should apply. Stated differently, Health Partners takes the position that the Legislature, in 1986, made it clear in § 27-21A-23 that any future enactments affecting the operation of HMOs would be made in Chapter 21A of Title 27.
After carefully examining § 27-1-19 and § 27-21A-23, we find merit in Health Partners' argument that our holding in Blue Cross should control this case and that § 27-1-19 should be held inapplicable to HMOs, based on the plain language of the § 27-21A-23 exemption. However, we also find compelling Axelroth's argument that the Legislature could have intended for § 27-1-19 to apply to HMOs, given the fact that it specifically referred therein to "health maintenance organizations" and the fact that the substantive provisions of § 27-1-19 could logically apply to HMOs. In discussing statutory construction, this Court has stated:
Ex parte Holladay, 466 So. 2d 956, 960 (Ala. 1985). In IMED Corp. v. Systems Engineering Assocs. Corp., 602 So. 2d 344, 346 (Ala. 1992), this Court further stated, with regard to statutory construction:
Of course, the problem we face here is similar to the one we faced in Blue Cross, in that we have two sections § 27-1-19 and § 27-21A-23that are clear enough when considered separately, but when considered together send patently conflicting signals as to legislative intent. Obviously the Legislature either intended that § 27-1-19 apply to HMOs or intended that it not apply to them. Under these circumstances, we would normally proceed in accordance with our rules of statutory construction and attempt to ascertain whether the Legislature actually intended for § 27-1-19 to apply to HMOs; however, we find it unnecessary and, thus, imprudent, for us to do that in order to resolve the specific issues between these parties, because, even if we were to assume that § 27-1-19 applies to Health Partners, the record indicates that the summary judgment would be proper.[1]
As previously noted, both of Axelroth's claims are based on allegations that his services were covered under the city and county plans and that he had a statutory right to have Health Partners reimburse him for services he provided to plan members. However, Health Partners made a prima facie showing that the schedules of benefits contained in the applicable certificates of coverage did not include podiatric services unless those services were requested by a plan member's primary care physician and were provided by a participating podiatrist or by a nonparticipating podiatrist authorized by Health Partners. The certificates specifically stated that nonparticipating-provider services had to be authorized by Health Partners. The nonparticipating-provider rider attached to each of the certificates allowed the primary care physician to refer a plan member to a nonparticipating specialist; however, according to the testimony of Dr. Osburne, the rider did not eliminate Health Partners' right under the certificate to disapprove the nonparticipating provider selected by the primary care physician. We can find nothing in the record to dispute Dr. Osburne's testimony in this respect. Furthermore, § 27-1-19(e) provides that "[n]othing in this section shall be construed to limit any... health maintenance organization ... from determining the scope of its benefits or services or any other terms of its group and/or individual insured, subscriber or enrollee contracts."[2] Nothing in § 27-1-19 required Health Partners to allow podiatrists to participate in the city and county plans, and nothing in that section required Health Partners to authorize treatment by nonparticipating podiatrists during the credentialing period. Therefore, in the absence of specific authorization from Health Partners, podiatric services were not "covered" under the city and county plans and Axelroth was not entitled under § 27-1-19 to be paid for services provided to plan members.[3]
*886 Based on the above, we conclude that even if § 27-1-19 applied to Health Partners, Axelroth could not establish a violation of it because he has failed to show that he was denied payment for a covered service. Health Partners was, therefore, entitled to a judgment as a matter of law on Axelroth's statutory claim.
We also conclude that Health Partners was entitled to a judgment as a matter of law on Axelroth's claim alleging intentional interference with his practice. Intentional interference with a contract or business relation is a necessary element of the tort, see Barber v. Business Products Center, Inc., 677 So. 2d 223 (Ala.1996); a mere refusal to deal is not actionable. Id. Health Partners made a prima facie showing that podiatric services were not covered under its contracts with the city and the county during the period in question in the absence of a specific authorization from Health Partners and that it was not authorizing podiatric treatment for nonroutine foot care pending the finalization of its credentialing standards and the approval of its proposed provider contract by the Department of Public Health. Axelroth failed to present substantial evidence to rebut Health Partners' prima facie showing that it did not intentionally interfere with his practice by fraudulently representing to his patients that podiatric services were not covered.
For the foregoing reasons, the summary judgment is affirmed.
AFFIRMED.
HOOPER, C.J., and MADDOX, SHORES, KENNEDY,[*] and SEE, JJ., concur.
COOK, J., concurs in the result.
COOK, Justice (concurring in the result).
I concur in the majority's conclusion that Dr. Axelroth did not produce substantial evidence indicating that Health Partners of Alabama ("Health Partners"), which is a health maintenance organization ("HMO"), violated Ala.Code 1975, § 27-1-19, or otherwise wrongfully interfered with the doctor's business relationships. However, the majority alsoand unnecessarilydiscusses at some length whether § 27-1-19 applies to Health Partners. Because that discussion seems to imply that § 27-1-19 does not apply to Health Partners, I do not concur in that portion of the opinion.
Assuming that it does apply, the validity of all of Dr. Axelroth's claims turns on whether Health Partners' selective coverage was wrongful. Significantly, § 27-1-19(e) states: "Nothing in this section shall be construed to limit any ... health maintenance organization... from determining the scope of its benefits or services or any other terms of its group ... contracts...." (Emphasis added.) Thus, that section authorizes Health Partners to exclude coverage of services provided by podiatrists if it so chooses.
Dr. Axelroth focuses on the fact that nonroutine foot care was covered under the plan. However, that focus is misplaced. Health Partners does not dispute the fact that nonroutine foot care was covered; it merely required that such services be performed by orthopedic surgeons, rather than by podiatrists. That sort of selectivity is precisely what § 27-1-19(e) authorizes. Because Health Partners' policy of excluding podiatric services was statutorily authorized, it was not wrongful. The trial court, therefore, correctly entered a summary judgment for Health Partners.
As to whether § 27-1-19 applies to Health Partners, however, I point out that this case differs fundamentally from Blue Cross & Blue Shield of Alabama, Inc. v. Nielsen, 714 So. 2d 293 (Ala.1998), in which we concluded that Blue Cross was exempt from the application of § 27-1-19. We did so in that case, not because Blue Cross was an HMO, but because it was a not-for-profit corporation, incorporated pursuant to §§ 10-4-100 to -115. Such entities are expressly exempted by § 27-1-4(2). Nielsen, 714 So. 2d at 297.
But HMOs are not so exempted. On the contrary, § 27-1-19(a) expressly includes *887 HMOs. Health Partners states only that it is an HMO, "organized under the laws of the State of Alabama to provide basic health care services through an organized system which combines the delivery and financing of health care to its members. See Ala.Code [1975] § 27-21A-1(7) (1986), et seq." Brief of Appellee, at 3. Significantly, it does not state or allege that it is incorporated pursuant to §§ 10-4-100 to -115. Thus, the rationale of Nielsen does not apply in this case.
Health Partners bases its argument for exclusion on §§ 27-21A-4 and -23. Brief of Appellee, at 11. Section 27-21A-23(a) states in part: "Except as otherwise provided in this chapter, provisions of the insurance law and provisions of health care service plan laws shall not be applicable to any health maintenance organization granted a certificate of authority under this chapter." (Emphasis added.)
That section was adopted in 1986. Section 27-1-19, however, was adapted in 1994, as Act No. 94-638, 1994 Ala. Acts 1197. Thus, § 27-1-19, which expressly includes HMOs, is a later expression of the Legislature on the subject of the applicability of insurance laws to HMOs. As such, it is subject to the well-established rule of statutory construction "`that the last expression of the legislative will is the law, in cases of conflicting provisions in the same statute, or in different statutes, the last enacted in point of time prevails.'" Williams v. State ex rel. Schwarz, 197 Ala. 40, 54, 72 So. 330, 336 (1916) (Thomas, J., dissenting).
The 1986 statute purports to exclude HMOs, while the 1994 statute, the Legislature's later treatment of the subject, purports to include them. Thus, I do not concur in the majority opinion to the extent it suggests that HMOs in general, and Health Partners in particular, are not subject to § 27-1-19.
[1] Ideally, any clarification with regard to the scope of § 27-1-19 should be made by the Legislature, not by this Court.
[2] We are not persuaded by Axelroth's argument that § 27-1-15 eliminated Health Partners' contractual right to disapprove treatment by a nonparticipating podiatrist. Section 27-1-15 provides:
"Notwithstanding any other provision of law, when any contract of health insurance or any plan or agreement for health services provides for the reimbursement or payment for services which are within the scope of a podiatrist's professional license as defined in the general laws of Alabama, such policy shall be construed to include payment to a podiatrist who has performed such procedures."
This section was enacted in 1976 (Ala. Acts 1976, No. 678), as part of the Insurance Code. In 1986 the Legislature made it clear in § 27-21A-23 that, "[e]xcept as otherwise provided in [Chapter 21A], provisions of the insurance law and provisions of health care service plan laws shall not be applicable to any health maintenance organization granted a certificate of authority under [Chapter 21A]." There is no provision in Chapter 21A that is comparable to § 27-1-15, which the Legislature is presumed to have been aware of when it enacted the § 27-21A-23 exemption. Blue Cross, supra. Furthermore, as previously noted, the record indicates that podiatric services were covered under the city and county plans, provided Health Partners authorized the treatment. Section 27-1-15 cannot be read so as to void other material provisions in the certificates of coverage, such as the one allowing Health Partners to disapprove treatment by a nonparticipating podiatrist.
[3] The record indicates that Health Partners did on occasion authorize treatment by a podiatrist. These authorizations appear to have been exceptions that were made based on the peculiar circumstances of those cases.
[*] Although Justice Kennedy was not present at oral argument in this case, he listened to the tape of oral argument. | deb72a7cc430171d0c33cf7c1913f8b3b46bdd4acef870d8a76c9cf6ebb1c8bc | 1998-07-24 00:00:00 |
1e75cacb-62a8-4fe0-902f-c176aae42040 | Kirby v. City of Anniston | 720 So. 2d 887 | 1970999 | Alabama | Alabama Supreme Court | 720 So. 2d 887 (1998)
Mattie KIRBY and Walter M. Madden, Jr.
v.
CITY OF ANNISTON et al.
1970999.
Supreme Court of Alabama.
July 24, 1998.
Solomon S. Seay, Jr., Montgomery, for appellants.
*888 C. David Stubbs of Stubbs, Sills & Frye, P.C., Anniston; and Richard Whitehead, Anniston, for appellee.
HOUSTON, Justice.
Mattie Kirby and Walter M. Madden, Jr., former members of the City of Anniston Board of Education ("the board"), filed this action on March 14, 1997, against the City of Anniston; its mayor, W. Gene Stedham; its city council; and council members Andrew B. Hatley, Hans Gray, James D. Montgomery, and Debra D. Foster, seeking declaratory and injunctive relief.[1] Specifically, Kirby and Madden sought to have a city council resolution (No. 97-R-14) declared void as violating the state and federal constitutions and as violating a city ordinance (No. 96-0-39) governing the procedure for adopting such resolutions. The resolution, which was passed pursuant to Ala.Code 1975, § 16-11-3.1, changed the at-large method by which board members had been appointed and, instead, called for board members to be appointed by the mayor and city council from four school districts corresponding to the four council wards and for one board member to be appointed by the mayor from the city at large.[2] The resolution required that each board member reside within the ward from which he or she was appointed. The resolution had the effect of dissolving the board and thereby terminating Kirby and Madden's positions. Neither Kirby nor Madden was reappointed.
The case was submitted to the trial court on briefs and stipulated facts; the basic issues presented were 1) whether § 16-11-3.1 provided the constitutional underpinning for the challenged resolution or, instead, whether § 16-11-3.1 violated Article VII, § 173 and § 175, of the Alabama Constitution, and the due process and equal protection guarantees of the United States Constitution, by authorizing the city council to effectively terminate Kirby and Madden's positions on the board before the expiration of their terms, without following the impeachment process set out in § 173 of the Constitution; and 2) whether the resolution was due to be set aside on the ground that the council did not follow the proper procedure in bringing the resolution up for a vote. (Ordinance No. 96-0-39 provided in pertinent part: "No ordinance or resolution of a permanent nature shall be adopted at the meeting at which it is introduced unless unanimous consent be obtained for the immediate consideration of such ordinance or resolution...." The council, by a 3-2 vote, agreed to consider the resolution at the meeting at which it was introduced.)
On December 23, 1997, the trial court ruled that the pre-August 1, 1997, version of § 16-11-3.1, under which the council had acted (see n. 2, supra), was constitutional; however, it found that the council had failed to comply with the ordinance governing the procedure for adopting resolutions. The trial court specifically noted that the Legislature had amended § 16-11-3.1 so as to prevent a city council from abolishing a board member's position during his or her term of office:
The trial court declared the resolution void and enjoined the city from taking any further action pursuant to it. The effect of the trial court's order was to reinstate Madden to the board, at least until his term expired in April 1998; Kirby's term had expired before the date of the trial court's order.
The sole issue raised on this appeal is whether the unamended version of § 16-11-3.1 was constitutional. Although both parties argue the merits of the trial court's constitutional ruling, we find persuasive the defendants' argument that this appeal should be dismissed. It is a well-settled principle of appellate review that this Court will not decide questions that are moot or that have become purely academic. It is not the province of this Court to resolve an issue unless a proper resolution would afford a party some relief. See Dunn v. Alabama State University Board of Trustees, 628 So. 2d 519 (Ala. 1993), overruled on other grounds, Watkins v. Board of Trustees of Alabama State University, 703 So. 2d 335 (Ala.1997), and the cases cited in Dunn. See, also, Lowe v. Fulford, 442 So. 2d 29, 33 (Ala.1983), noting that a court has a duty to avoid a constitutional question unless an answer to it is essential to the proper disposition of the case. We recognize, as the trial court did, that the Legislature has amended § 16-11-3.1 so as to prevent the very practice of which Kirby and Madden complainthe removal of board members during their terms through the dissolution and restructuring of a city board of education. Kirby and Madden, neither of whom is still in office, were successful in having the resolution set aside. Even if we were to address the issue presented and to hold the unamended version of § 16-11-3.1 unconstitutional, we could afford no relief to either Kirby or Madden. This Court does not reach abstract constitutional issues whose resolution would have no impact upon the parties.
APPEAL DISMISSED AS MOOT.
HOOPER, C.J., and ALMON, COOK, and LYONS, JJ., concur.
[1] Kirby's five-year term on the board expired in April 1997, shortly after this action was filed. Madden's term expired in April 1998, several months after the trial court had issued its order and this appeal had been filed.
[2] At the time this action was filed, § 16-11-3.1 provided:
"The governing body of any Class 5 municipality may, by resolution, provide for the appointment of the city board of education from districts corresponding to the city governing body districts and the manner of appointment, the appointment of one member from the city at-large by the mayor, and the length of terms of the board members."
This section was amended, effective August 1, 1997. It now reads as follows:
"The governing body of any Class 5 municipality may, by resolution, provide for the appointment of the city board of education members from districts corresponding to the city governing body districts and the appointment of one member from the city at-large by the mayor, only upon the expiration of each city board of education member's current term."
(Emphasis added.) | b38b5183cf366dfc43eb88598ea00260770f4ed5fdf7593cb69a0a906ceca9d2 | 1998-07-24 00:00:00 |
39a38c28-cd70-43fa-9a32-d6128537ad97 | Ala. Dept. of Transp. v. Blue Ridge Sand and Gravel, Inc. | 718 So. 2d 27 | 1961920 | Alabama | Alabama Supreme Court | 718 So. 2d 27 (1998)
ALABAMA DEPARTMENT OF TRANSPORTATION et al.
v.
BLUE RIDGE SAND AND GRAVEL, INC.; and Bob Estes.
1961920.
Supreme Court of Alabama.
June 26, 1998.
*28 Jim R. Ippolito, Jr., chief counsel, Alabama Department of Transportation, for appellants.
David Cromwell Johnson and J. Flint Liddon of Johnson, Liddon & Tuggle, Birmingham, for appellees.
ALMON, Justice.
The Alabama Department of Transportation and a number of its officials and employees, who were defendants in the circuit court, appeal from a preliminary injunction. The circuit court's injunction has the effect of prohibiting the use of the Department's "Standard Specifications for Highway Construction" unless and until those specifications are adopted as rules pursuant to the Alabama Administrative Procedure Act ("AAPA"), Ala.Code 1975, § 41-22-1 to -27. We conclude that the injunction should be dissolved and the case remanded.
The plaintiffs, Blue Ridge Sand and Gravel, Inc., and Bob Estes, sought, among other relief, a preliminary injunction against the Department's implementation of amendments to §§ 801.01(a), 801.03(a), and 802.06 of the standard specifications and supplemental specification 4-92(2). These amendments and the supplemental specification require that gravel for use in hot mix asphalt for roads and in the superstructure of bridges "shall have a bulk specific gravity greater than 2.550." The plaintiffs contend that each of these amendments to the standard specifications is a "Rule" as that term is defined in § 41-22-3(9), so that the rulemaking provisions of the AAPA, especially§§ 41-22-4, -5, and -23, apply to the promulgation of the amendments. The plaintiffs contend that, because the Department did not comply with those provisions, it cannot use the amended standard specifications in any highway construction contract. Blue Ridge quarries and sells gravel made from chert, which has a specific gravity less than 2.550.
The Department presented evidence indicating that it adopted the 2.550 standard after experiencing premature failures of road surfaces and bridges with gravel made from chert. Larry Lockett, a materials and test engineer with the Department who had authority in this matter, testified:
Lockett also testified that the Department had experienced failures of asphalt pavements with chert gravel within 6 to 24 months, while the average life span of asphalt pavements is 12 years. Lockett said that he had been studying the problem for years and that the Department had done testing before it arrived at the 2.550 specific-gravity specification. Thus, the Department's evidence showed that its adoption of the 2.550 specific-gravity specification was an attempt to improve road and bridge longevity and to reduce maintenance costs.
The question is whether the standard specifications are "rules" within the meaning of § 41-22-3(9), Ala.Code 1975. The Department argues that they are not, but that they are only, as they purport to be, specifications for engineering details and materials that may be incorporated by reference into a request for bids for highway construction contracts. Section 41-22-3(9) defines "Rule" as "Each agency regulation, standard or statement of general applicability that implements, interprets, or prescribes law or policy, or that describes the organization, procedure, or practice requirements of any agency...."
The standard specifications do not "describe[] the organization, procedure, or practice requirements of" the Department. Pursuant to the AAPA, the Department has adopted administrative rules that describe its organization, procedure, and practice requirements. See Alabama Administrative Code, Chapter 450-1-1 et seq.
Nor do the standard specifications constitute an "agency regulation, standard or statement of general applicability that implements, interprets, or prescribes law or policy." Rather, each of the specifications, including the amended specifications directly at issue here, is simply a term that may be incorporated into a contract between the Department and some other party. See generally § 41-16-27, Ala.Code 1975, which provides that, in accepting or rejecting competitive bids, an awarding authority may take into consideration "the qualities of the commodities proposed to be supplied, their conformity with specifications, the purposes for which required," and so forth. Ala.Code 1975, § 41-16-27(a) (emphasis added). If an unsuccessful bidder or another interested party[1] considers specifications for a given contract to be inappropriate, the competitive bid law provides a means for challenging the inclusion of those specifications. See § 41-16-31; White v. McDonald Ford Tractor Co., 287 Ala. 77, 248 So. 2d 121 (1971). The fact that the Department has established standard specifications that it may incorporate by reference rather than setting forth all specifications in each highway construction contract does not elevate those specifications to the status of "rules." All interested parties seriously involved in highway *30 contracting and supplying materials know of these standard specifications, because the Department makes them available to the public.[2] See § 23-1-34; Chapter 450-1-1-.09 and 450-1-2-.06, Ala. Admin. Code.
The Supreme Court of Michigan, in affirming the lower courts' holding that the Michigan highway department's standard specifications were not an agency rule subject to the Michigan Administrative Procedures Act, stated:
Greenfield Constr. Co. v. Michigan Dep't of State Highways, 402 Mich. 172, 190-91, 261 N.W.2d 718, 722-23 (1978). Section 7 of the Michigan APA cited in Greenfield Constr. Co. is very similar to the first part of § 41-22-3(9) of the AAPA.
To like effect is Department of Transportation v. Blackhawk Quarry Co. of Florida, 528 So. 2d 447 (Fla.Dist.Ct.App.), rev. denied, 536 So. 2d 243 (Fla.1988), which held that a standard specification similar to the one here was not a "rule" within the meaning of § 120.52(16) of the Florida Statutes, which sets out an APA definition virtually identical to that in our § 41-22-3(9):
528 So. 2d at 450.
We agree with the Michigan Supreme Court and the Forida District Court of Appeal that such standard specifications are not "rules" within the purview of the Administrative Procedure Act.
Moreover, even if the Department of Transportation's Standard Specifications for Highway Construction might be considered "rules," the evidence presented to the circuit court brings the amended and supplemental specifications within one or more exceptions to the AAPA's definition of "Rule." The definition in § 41-22-3(9) of "Rule" states that a rule, for purposes of the AAPA, "includes *31 any form which imposes any requirement or solicits any information not specifically required... by an existing rule or by federal statute or by federal rule or regulation." The Department introduced evidence indicating that the adoption of the 2.550 specific-gravity requirement was required for the state to continue receiving federal highway money. In addition to the testimony quoted above, the Department submitted, in support of its motion to stay enforcement of the injunction, a copy of a letter from Joe D. Wilkerson, division administrator of the Federal Highway Administration, to the director of the Alabama Department of Transportation. That letter stated, in part:
By the terms of § 41-22-3(9), the standard incorporated into § 801.01(a) and the other amended and supplemental specifications is not a "rule" governed by the AAPA, because it is "specifically required ... by federal rule or regulation."
In the chapters of the Code governing the operation of the Department of Transportation, there are many instances where the Department is given the authority to make agreements with, or otherwise to cooperate with, the Federal Government so as to facilitate the receipt of federal money for the construction of highways and bridges and for other reasons. See, e.g., § 23-1-1, authorizing the Department to "enter into all necessary contracts and agreements with the United States government or any agency or officer thereof ... and to do all other things necessary to secure to the state and its counties and municipalities the full benefits provided by [Congressional] acts"; § 23-1-57(4), regarding compliance with federal regulations when the Department enters an agreement regarding the construction of a bridge across a river forming a state boundary; § 23-1-170 et seq., especially -175(13), regarding the Alabama Finance Corporation; and § 23-1-300 et seq., creating the Federal Aid Highway Finance Authority. If the Department were required to implement rulemaking procedures each time the Federal Government changed its requirement for some aspect of road-building, the attendant delays, expense, and use of the time of Department employees could completely strangle the entire process of highway construction in this state. This shows that the exception in § 41-22-3(9) for requirements imposed by federal rule or regulation is a reasonable exception to the definition of "Rule"; this further supports our conclusion that the injunction is due to be dissolved.
The Department of Transportation (formerly the Highway Department, see § 23-1-20, as amended) has maintained its standard specifications for many years. Indeed, a 1969 act of the legislature incorporated a portion of the standard specifications into the Alabama Code. Section 23-1-60, Ala.Code 1975, incorporates the portion of the standard specifications that give the director of transportation "authority to make, at any time during the progress of any construction on any highway project under his jurisdiction, such changes or alterations of construction details ... as may be necessary or desirable for the successful completion of the project." From this section, it is clear both that the legislature was aware of the standard specifications well before it enacted the AAPA and that the legislature has given the director of transportation authority to modify the terms and conditions of highway construction even during the progress of a particular project. It would be contradictory to conclude that the director can modify construction specifications during the work on a particular project without engaging in rulemaking procedures, but can modify such specifications before a contract is awarded only by rulemaking procedures.
The AAPA was adopted in 1981; see 1981 Ala. Acts, Act No. 81-855, p. 1534. The Department has adopted rules according to the provisions of the AAPA, pursuant to its rulemaking authority; see § 23-1-59. Those rules are incorporated into the Alabama Administrative *32 Code at Chapter 450-1-1 et seq., but they do not include detailed highway engineering requirements such as are included in the standard specifications. The record indicates that it has not been suggested until now that the Department's standard specifications should be adopted pursuant to rulemaking procedures of the AAPA. The AAPA gives the legislature oversight of administrative rulemaking, see §§ 41-22-2, -6, -22, and -23, but, in spite of its familiarity with the standard specifications, as evidenced by its enactment of § 23-1-60, and in spite of the significance of highway expenditures (one of the largest expenditures in the State budget), there is no indication that the legislature has ever questioned the absence of the standard specifications from the rules in the Administrative Code. This indicates a legislative intent that the standard specifications are not "rules" within the contemplation of § 41-22-3(9) and the AAPA.
Chapter 450-1-2-.01(1) of the Department's Administrative Code states that "Any interested person may petition the Alabama Highway Department requesting the adoption, amendment, or repeal of a rule." See § 41-22-8, which requires each agency governed by the AAPA to adopt such a rule. The plaintiffs here have not shown that they requested the adoption of the amended specifications (or a less-strict version that would allow the use of their gravel) as "rules" within the contemplation of the AAPA. Furthermore, the plaintiffs did not avail themselves of the procedure for petitioning for a declaratory ruling provided by Chapter 450-1-2-.02. Because the Department has used its standard specifications for many years, both before and since the adoption of the AAPA, without any suggestion that they be adopted as rules, and because Estes and Blue Ridge Sand and Gravel made no request for a change in the amended specifications[3] or for a declaratory ruling by the Department, we conclude that they failed to exhaust their administrative remedies. See, e.g., Mobile & Gulf R.R. v. Crocker, 455 So. 2d 829 (Ala. 1984); Fraternal Order of Police, Strawberry Lodge No. 40 v. Entrekin, 294 Ala. 201, 314 So. 2d 663 (1975).
The circuit court's preliminary injunction purports to reach only the 1997 amendments at issue here, but its reasoning would reach the entire manual of standard specifications. The Department has published a 1992 edition and a 1995 edition of its standard specifications. The Department has, admittedly, made these revisions without engaging in rulemaking procedures. For all that appears, the entire set of standard specifications would be rendered void by the trial court's injunction.
A trial court "will balance the probable resulting damages to the respective parties" when considering whether to issue a preliminary injunction. Woodstock Operating Corp. v. Quinn, 201 Ala. 681, 682, 79 So. 253, 254 (1918); Martin v. First Federal Sav. & Loan Ass'n of Andalusia, 559 So. 2d 1075, 1079 (Ala.1990). "Loss of profits does not justify the issuance of an injunction." State Dep't of Public Safety v. Scotch Lumber Co., 293 Ala. 330, 333, 302 So. 2d 844, 846 (1974). The harm that Blue Ridge and Estes would suffer without the injunction is the loss of profits they might receive from selling chert to highway contractors for use in the construction of state roads and bridges. By contrast, the injunction harms the Department by requiring it to accept for highway and bridge construction a material that it has determined causes premature failure. The injunction may result in excessive costs in the repair or replacement of defective roads and bridges[4] and in the loss of federal highway *33 money. Balancing the hardship the injunction imposes on the Department against the injury to the plaintiffs if the injunction is denied, we conclude that the balance of equities favors the defendants.
For the reasons stated, we conclude that the Department of Transportation's Standard Specifications for Highway Construction are not "rules" within the purview of the Alabama Administrative Procedure Act. The circuit court erred in entering the injunction prohibiting the defendants from incorporating the amended and supplemental standard specifications into highway and bridge construction contracts.
INJUNCTION DISSOLVED AND CASE REMANDED.
HOOPER, C.J., and MADDOX, SHORES, HOUSTON, and SEE, JJ., concur.
[1] Blue Ridge Sand and Gravel does not bid on contracts; it provides price quotes to contractors for supplying gravel to the contractor. The contractor, if it plans to buy from Blue Ridge, then uses that quote to formulate its bid for the contract.
[2] This Court requested and received a copy of the Standard Specifications because the record did not include a full set of those specifications. The bound volume the Court received contains more than 600 pages of detailed specifications.
[3] Instead, they relied on § 41-22-10, which provides for a declaratory judgment action to determine "[t]he validity or applicability of a rule" and for injunctive relief.
[4] In support of its motion asking the circuit court to dissolve the injunction and its later motions in that court and this one for a stay, the Department submitted the September 4, 1997, affidavit of Dykes T. Rushing, the office engineer for the Department. Mr. Rushing stated that for the remainder of the year 1997 the Department planned to engage in bid lettings totalling $197,000,000. He stated: "A major portion of these projects involves plant mixed asphalt and bridge superstructures to which the Department's enjoined bulk specific gravity special provisions applied. Given the premature failure of road wear surfaces containing chert gravel, the Department will expend additional resources to repair or replace those surfaces contained within the above lettings if chert gravel is used in the plant mixed asphalt or concrete bridge decks. A conservative estimate of the cost of repair is 50% of the original cost of the projects or $98,500,000.00." | 74566bb087fecd0b1a1b953c943201d53c700f524a23c2ea437f3aac7fd3637c | 1998-06-26 00:00:00 |
abc8bf33-b227-4459-90c2-ff3a2e0c8fc5 | Ex Parte Weiss | 718 So. 2d 44 | 1971138 | Alabama | Alabama Supreme Court | 718 So. 2d 44 (1998)
Ex parte Richard WEISS.
(Re Richard WEISS v. Catherine Weiss HISCOCKS).
1971138.
Supreme Court of Alabama.
July 2, 1998.
J. Michael Williams, Sr., of Gullage & Williams, Auburn, for petitioner.
No brief filed for respondent.
KENNEDY, Justice.
WRIT DENIED. NO OPINION.
SHORES, HOUSTON, COOK, and LYONS, JJ., concur.
HOOPER, C.J., and MADDOX, J., dissent.
MADDOX, Justice (dissenting).
I respectfully dissent from the order denying certiorari review, because I believe this case presents a question that deserves our consideration. Specifically, I believe the Court should consider whether the standard of Ex parte McLendon, 455 So. 2d 863, 865-66 (Ala.1984) (that a party seeking a modification of a child custody order bears the burden of proving that "a change of the custody [would] materially promote [the] child's welfare"), should apply.
Because the majority denies review without an opinion, I will briefly set out the relevant facts. The parties in this case were divorced in 1991; the court awarded joint custody, with the mother being the primary custodian. The father subsequently petitioned for a modification of the custody order so as to make him the primary custodian or to make him an equal custodian. The trial court denied his petition, holding that he had not met the McLendon standard.
*45 The Court of Civil Appeals affirmed, without opinion, citing McLendon. Weiss v. Hiscocks, (No. 2961282) 718 So. 2d 44 (Ala.Civ. App.1998) (table). I believe, however, that there is a valid question whether McLendon applies in this case.
In McLendon, the trial court had previously awarded sole custody to one parent, and it was faced with a request from the noncustodial parent for a modification. In that case, this Court held that a party seeking a change in custody must prove that it would "`materially promote [the] child's welfare.'" 455 So. 2d at 865 (quoting Greene v. Greene, 249 Ala. 155, 157, 30 So. 2d 444, 445 (1947), quoting in turn Stringfellow v. Somerville, 95 Va. 701, 29 S.E. 685, 687, 40 L.R.A. 623 (1898)). In adopting that rule, this Court acted on the theory that disruption in and of itself is detrimental to a child and that the reduction of disruption is desirable. McLendon, however, was based on a line of cases in which one party had earlier been awarded sole custody. In this case the initial order granted joint custody, with the mother being the primary custodian.
In Ex parte Couch, 521 So. 2d 987 (Ala. 1988), a case in which the trial court had initially granted joint custody, this Court held that the McLendon standard did not apply. In Couch, the parents had been awarded equal custody in the initial custody order. As a result, the Court held that the less burdensome "best interest" standard should be applied in a modification proceeding. In that case, the Court also looked at the policy underlying McLendon, i.e., the policy of minimizing disruption to the child, and determined that that policy was inapplicable in the fact situation in Couch.
The petitioner argues that Couch applies here. He also argues that the rationale of the Court of Civil Appeals in Hovater v. Hovater, 577 So. 2d 461 (Ala.Civ.App.1990), which relied on Couch, should be applied. In Hovater, where the parents had joint custody but the mother was designated the primary custodian, the Court of Civil Appeals held that the "best interest" standard applied, rather than the McLendon standard. The Court of Civil Appeals held that "[w]here there is no prior order granting exclusive physical custody to one parent, ... the McLendon standard is not applicable." 577 So. 2d at 464 (emphasis added).
I believe the petitioner has raised a question that merits this Court's consideration. I would grant certiorari review to consider that question. Consequently, I must respectfully dissent.
HOOPER, C.J., concurs. | 389e203c8fd4a7dd699f516bb7b770b488488b779e7d097018583ec851de1cb8 | 1998-07-02 00:00:00 |
5c90f49f-73d2-44be-b8f5-674990ddb7ff | Ex Parte Dan Tucker Auto Sales, Inc. | 718 So. 2d 33 | 1951866 | Alabama | Alabama Supreme Court | 718 So. 2d 33 (1998)
Ex parte DAN TUCKER AUTO SALES, INC.
(In re John PHELPS v. DAN TUCKER AUTO SALES, INC., et al.).
1951866.
Supreme Court of Alabama.
July 2, 1998.
*34 John Martin Galese and Jeffrey L. Ingram of John Martin Galese, P.A., Birmingham, for petitioner.
E. Martin Bloom of Starnes & Atchison, Birmingham, for respondent.
HOOPER, Chief Justice.
Dan Tucker Auto Sales, Inc. ("Tucker"), the defendant in an action pending in the Jefferson Circuit Court, petitions for a writ of mandamus directing the Jefferson Circuit Court 1) to withdraw its order of July 29, 1996, directing Tucker to pay an arbitration filing fee and 2) to require the plaintiff, John Phelps, to pay that filing fee. We grant the petition. We conclude that Phelps, who filed the complaint in the circuit court, is the "claimant" and the "initiating party" for purposes of interpreting Rule 6 of the Commercial Arbitration Rules of the American Arbitration Association ("AAA").
Phelps's lawsuit against Tucker arose out of Tucker's sale of a used automobile to Phelps. Tucker asked the circuit court to compel arbitration, in accordance with the predispute arbitration agreement made by the parties on May 7, 1991. On June 12, 1995, the circuit court granted the motion to compel arbitration. Phelps petitioned this Court for a writ of mandamus directing the circuit court to rescind its order compelling arbitration. On December 22, 1995, this Court denied the writ. Ex parte Phelps, 672 So. 2d 790 (Ala.1995).
After we denied the writ, Phelps asked the circuit court to direct Tucker to pay the arbitration filing fee. Phelps claimed that payment of arbitration fees might impose a hardship on him. On July 29, 1996, the circuit court ordered Tucker to pay the arbitration filing fee. Tucker now asks us to direct the circuit court to vacate that July 29, 1996, order.
The May 7, 1991, arbitration agreement signed by Tucker and Phelps specifically adopted the American Arbitration Association's Commercial Arbitration Rules.[1] Tucker argues that these rules require that Phelps file his demand with the American Arbitration Association and prepay the appropriate filing fee. Phelps claims that the rules provide that the "initiating party" is to file and pay the fee, and Phelps argues that
*35 Tucker is the initiating party because Tucker asked the court to compel arbitration. The question raised here is which of these parties is the "initiating party" as contemplated by the Commercial Arbitration Rules. We hold that Phelps, the plaintiff, is the initiating party.
The Commercial Arbitration Rules of the American Arbitration Association (1993), made applicable by the parties' agreement, provide as follows:
(Emphasis added.)
According to the Commercial Arbitration Rules relating to "administrative fees," the party "initiating" the arbitration pays the "filing fee." See Rule 48. Therefore, whether Tucker is entitled to the writ depends upon the meaning of the term "initiating party" as it is used in the Commercial Arbitration Rules. The United States Supreme Court has held that arbitration contracts cannot be singled out and subjected to different or more stringent rules of construction. Doctor's Associates, Inc. v. Casarotto, 517 U.S. 681, 116 S. Ct. 1652, 134 L. Ed. 2d 902 (1996). Therefore, we answer this question by applying traditional rules of contract interpretation.
General contract law requires a court to enforce an unambiguous, lawful contract, as it is written. P & S Business, Inc. v. South Central Bell Telephone Co., 466 So. 2d 928, 931 (Ala.1985). See also McDonald v. U.S. Die Casting & Development Co., 541 So. 2d 1064 (Ala.1989). A court may not make a new contract for the parties or *36 rewrite their contract under the guise of construing it. Estes v. Monk, 464 So. 2d 103 (Ala.Civ.App.1985). The contract between Phelps and Tucker is unambiguous. It is an agreement, lawfully entered into, to purchase a used car for a sum of money. This contract should be enforced as written.
Parties to a contract are bound by pertinent references therein to outside facts and documents. Green Springs Associates, Ltd. v. Green Springs Village, Ltd., 577 So. 2d 872 (Ala.1991); Ben Cheeseman Realty Co. v. Thompson, 216 Ala. 9, 112 So. 151 (1927). "Other writings, or matters contained therein, which are referred to in a written contract may be regarded as incorporated by the reference as a part of the contract and[,] therefore, may properly be considered in the construction of the contract." 17A Am.Jur.2d Contracts § 400 (1991). The contract between Tucker and Phelps declares that disputes are to be resolved through binding arbitration according to the AAA's Commercial Arbitration Rules; therefore, the agreement incorporates the language of the Commercial Arbitration Rules regarding the resolution of disputes.
When interpreting a contract, a court should give the terms of the agreement their clear and plain meaning and should presume that the parties intended what the terms of the agreement clearly state. Pacific Enterprises Oil Co. (USA) v. Howell Petroleum Corp., 614 So. 2d 409 (Ala.1993). Words used in a contract will be given their ordinary, plain, or natural meaning where nothing appears to show they were used in a different sense or that they have a technical meaning. Smith v. Citicorp Person-to-Person Financial Centers, Inc., 477 So. 2d 308 (Ala.1985). "[S]pecific terms and exact terms are given greater weight than general language." Restatement (Second) of Contracts § 203(c) (1981). Where words used in a contract are susceptible of more than one meaning, the courts will, if possible, ascertain from all the provisions of the contract the sense in which the words were used by the parties. Tennessee v. Whitworth, 117 U.S. 129, 6 S. Ct. 645, 29 L. Ed. 830 (1886).
Rule 6 of the Commercial Arbitration Rules states that the "initiating party (hereinafter claimant)" shall file the "appropriate filing fee" as mandated in the schedule accompanying the rules. That same rule later explains that after the "claimant" has stated the nature of the dispute, the respondent shall file an answering statement and send that statement to the claimant. The word "claimant" is defined in Black's Law Dictionary (6th ed.1990) as "[o]ne who claims or asserts a right, demand or claim." The word "respondent" is defined in Black's as "one who makes an answer to a bill or other proceeding in equity" or one "who contends against an appeal." Considering these words in light of their plain meaning, we conclude that the "claimant" is the party who makes a demand upon another party and that the "respondent" is the party who must answer the allegations.
If we apply these general definitions to the facts of this case, it would be awkward to interpret the Commercial Arbitration Rules to mean that Tucker is the claimant. Such an interpretation would force Tucker to state the nature of the claims against itself. Equally as awkward, this interpretation would then force Phelps to answer the very complaint that he filed against Tucker. It is unreasonable to believe that the parties in this case intended to apply the terms "initiating party" and "claimant" to Tucker, the party defending itself against a claim by Phelps. Judging from the plain meaning of these labels as they are used in the Rules and from what the parties intended by the terms "claimant" and "initiating party," it is clear that Phelps is the claimant and Tucker is the respondent.
Had Phelps initially honored the terms of his agreement to arbitrate instead of filing a civil action, he would have been required to file with the AAA a written demand for arbitration, accompanied with the appropriate prepaid filing fee. He obviously would have been considered the initiating party. The logical outcome of the circuit court's order would be that any claimant could avoid paying the filing fee by going into court first and forcing the defendant to move to compel arbitration.
*37 A dispute over this exact wording was addressed by the Court of Appeals of Arizona in A.P. Brown Co. v. Superior Court, 16 Ariz.App. 38, 490 P.2d 867 (1971). In that case, the plaintiffs sought damages for the defendants' alleged fraud in inducing them to enter into a contract for the purchase of real estate. The defendants successfully moved to stay the action on the grounds that the contract required submission of the dispute to arbitration. The plaintiffs then petitioned the trial court to order the defendants to pay the appropriate filing fees. The plaintiffs contended that they were not the "initiating party" because the court had ordered arbitration on the motion of the defendant. The Arizona Court of Appeals wrote:
A.P. Brown Co., 16 Ariz.App. at 40-41, 490 P.2d at 869-70 (citations omitted). We find the reasoning of the Arizona Court of Appeals compelling.
Phelps argues that it might place a hardship upon him to force him to pay the filing fees, but, if it does, this alone should not permit this Court to substitute different meanings for the terms used by the parties. To do so would be contrary to Alabama law:
Lilley v. Gonzales, 417 So. 2d 161, 163 (Ala. 1982).
We should note, as did the Arizona Court of Appeals when it answered this same question in 1971, that our holding in no way precludes claimants under financial hardships from acquiring a resolution to contract disputes they have agreed to arbitrate. Phelps did not exhaust his administrative remedies as to the matter of the filing fee; he did not pursue the options provided for him under the AAA Commercial Arbitration Rules. Rule 48 specifically provides that the AAA can defer or reduce the administrative fees "in the event of extreme hardship on the part of any party."[2] Phelps has not yet asked the AAA to do this. It is also possible *38 under Rule 43 for the arbitrator to apportion all fees to one party or the other. The AAA's Commercial Arbitration Rules discourage frivolous claims, and, at the same time, they take into account the needs of financially distressed claimants.
The Jefferson Circuit Court is directed to vacate its July 29, 1996, order and to require Phelps, the "initiating party" referred to in the arbitration agreement, to prepay the costs for the arbitration.
WRIT GRANTED.
MADDOX and SEE, JJ., concur.
HOUSTON, COOK, and LYONS, JJ., concur specially.
ALMON, SHORES, and KENNEDY, JJ., dissent.
HOUSTON, Justice (concurring specially).
I was one of the four Justices who concurred in the opinion in Allied-Bruce Terminix Cos. v. Dobson, 628 So. 2d 354 (Ala. 1993),[3] which the United States Supreme Court reversed in Allied-Bruce Terminix Cos. v. Dobson, 513 U.S. 265, 115 S. Ct. 834, 130 L. Ed. 2d 753 (1995). Although I disagree with the majority of the United States Supreme Court in its Allied-Bruce interpretation of the Federal Arbitration Act as it applies to state courts, a majority opinion of that Court is part of the law I have taken an oath to uphold. See the second paragraph of Article VI of the Constitution of the United States. I agree with the belief expressed by Justice O'Connor in her special concurrence in Allied-Bruce, 513 U.S. at 283, 115 S.Ct. 834:
(Citations omitted.) I also agree with the dissenting opinions of Justice Scalia and Justice Thomas in Allied-Bruce. However, Justice O'Connor's belief and the dissenting opinions of Justice Scalia and Justice Thomas are not the law that I have taken an oath to uphold.
I personalize Chief Justice Burger's special concurrence in Bifulco v. United States, 447 U.S. 381, 100 S. Ct. 2247, 65 L. Ed. 2d 205 (1980):
447 U.S. at 401-02, 100 S. Ct. 2247 (Burger, C. J., concurring).
As I have in the past, I continue to oppose the judicial enforcement of predispute arbitration agreements, because of the state policy expressed in Ala.Code 1975, § 8-1-41(3). Unless that section is determined to violate the Constitution of Alabama or the policy expressed by that section is changed by acts of the Alabama Legislature, I will continue my opposition to the extent I am allowed to do so by the Constitution of the United States as interpreted by the Supreme Court of the United States.
COOK, Justice (concurring specially).
I concur in the conclusion that the plaintiff, Rev. John Phelps, is the "initiating party," as that term is used in Rule 6 of the American Arbitration Association's Commercial Arbitration Rules. That rule was incorporated by reference into the arbitration clause of the parties' purchase agreement. I write separately to express my concern that the factual circumstances that exist in this case present the question whether Reverend Phelps voluntarily, that is, knowingly and intelligently, consented to arbitration.
After this Court denied the mandamus petition filed by Reverend Phelps in this case, see Ex parte Phelps, 672 So. 2d 790 (Ala. 1995), he moved the trial court to "restore *39 [the] case to the active docket and set it for a jury trial," on the ground that Dan Tucker Auto Sales, Inc. ("Dan Tucker"), had initiated the arbitration procedure but had not paid the filing fee. On February 28, 1996, Jefferson County Circuit Judge Thomas A. Woodall denied that motion. On June 26, 1996, Dan Tucker moved the court to dismiss the action for "failure to prosecute ... in a timely manner."
On July 23, 1996, Reverend Phelps moved the trial court to reconsider its order denying his motion to "restore [the] case to the active docket." He supported this motion with his own affidavit, stating in part:
(Emphasis added.)
Subsequently, Judge Woodall entered the following order:
(Emphasis added.) Dan Tucker then petitioned this Court for a writ of mandamus directing Judge Woodall to vacate his order directing it to pay the fees necessary to initiate arbitration proceedings.
The facts of this case illustrate one of the many consequencesaltogether hidden from consumersof executing a contract containing an arbitration provision. The ability of consumers "to acquire basic goods and services" has, with increasing frequency, become dependent upon their acquiescence to written provisions requiring them to consent to arbitration and, thereby, to waive their rights to a trial by jury as guaranteed by U.S. Const. amend. VII, as to any claim that "may accrue to them" as a result of the transaction. Allstar Homes, Inc. v. Waters, 711 So. 2d 924, 933 (Ala.1997) (Cook, J., concurring specially). In the typical consumer credit transaction, consumers are first apprised of the necessity of this waiver after they have already expended considerable time and expense in negotiating the essential terms of their bargain. Id. at 933. A "contract" that requires consumers to acquiesce in this manner is, in fact, "punitive," because its rejection at that point in the transaction would result in the forfeiture of the time and expense a consumer has already incurred in the bargaining process. A "contract" to which a consumer is thus forced to acquiesce is adhesiveit is not truly voluntary. Id. at 933.
*40 But "volition is the sine qua non," not only of an effective waiver, but of the constitutionality of the Federal Arbitration Act, 9 U.S.C. § 2 ("the FAA"), which requires specific performance of written arbitration provisions. Allstar Homes, 711 So. 2d at 933.
In consumer cases such as this one, although the consumer's attention may be drawn to the fact that his "contract" contains an arbitration provision, it is seldom, if ever, directed to the fact that he will have to do what will, in many cases, be prohibitively expensive, in order to obtain any review of his claim. This is the essence of Reverend Phelps's affidavit testimony, specifically:
(Emphasis added.) In other words, Reverend Phelps asserts that although he may have been aware of the existence of the arbitration provision at the time this contract was executed, he was only subsequently confronted with the substance of the requirement to arbitrate, in this case, the cost of initiating the proceedingsa substance he had not contemplated and for which he had not bargained. The fact that this cost is entirely hidden from the consumer is merely another example of evidencebut a clear one that the consumer did not "agree," in a knowledgeable and intelligent manner, to the arbitration provision with the volition necessary to render the provision enforceable.
As the evidence in this case illustrates, a consumer not only must acquiesce in arbitration, but must, pursuant to the Rules of the American Arbitration Association ("AAA"), also prepay the fee to commence arbitration. The fee is substantial, as the following fee schedule, published as a part of the AAA's Commercial Arbitration Rules, illustrates:
These fees are subject to change, and the fees that are "applicable" are those that are "in effect when the fee or charge is incurred." Rule 48. Indeed, the schedule currently applicable requires Reverend Phelps to prepay $2,000that is $500 more than would have been required at the time he filed his affidavit.
Although I concur in the holding that Reverend Phelps is the initiating party, I have serious reservations as to whether he voluntarily, that is, knowingly and intelligently, consented to arbitration, thereby waiving his right to trial by jury. Because, however, he has not made that specific argument, this case is not postured for resolution of that question. Under the posture of this particular case, therefore, I agree that the petitioner is entitled to a writ of mandamus.
*41 LYONS, Justice (concurring specially).
Today, we release another in a series of cases in which I, as a recently appointed Justice, have been called upon to cast the deciding vote. I concur in the opinion of Chief Justice Hooper; however, because my vote overrules a minister's plea of financial hardship in an arbitration proceeding involving his purchase of a used automobile, I am compelled to explain my position in this difficult area of the law. I do not choose to leave my views in this area vulnerable to the charges of either hypocrisy or insensitivity.
My vote implicitly embraces the United States Supreme Court's teachings on arbitration in Allied-Bruce Terminix Cos. v. Dobson, 513 U.S. 265, 115 S. Ct. 834, 130 L. Ed. 2d 753 (1995),[5] and I write to address this question: Can a Justice on this Court, with intellectual honesty, accept Terminix and, at the same time, strenuously protest that the Tenth Amendment is being disregarded by the United States Supreme Court's use of the Fourteenth Amendment as the vehicle to regulate state action, on a theory of incorporation of the Bill of Rights of the United States Constitution that contradicts an objective weighing of historical evidence as to the intent of the framers of the amendment? I answer the question in the affirmative, for two reasons, one based upon the different source of federal constitutional authority at issue and the other based upon questions concerning the underlying Alabama constitutional guaranty of a remedy by arbitration for those who choose this alternative means of dispute resolution.
In Terminix, the Commerce Clause (Art. I, § 8) was the only aspect of the United States Constitution under consideration. The questions raised were whether Congress, in enacting the Federal Arbitration Act ("FAA"), intended the words "involving commerce"[6] to have the same meaning as the words "affecting commerce," and whether Congress intended the Act to apply in state courts as well as in federal courts. Our founding fathers were obviously convinced of the need "to regulate commerce ... among the several states," because the Constitution expressly provides for Congress to do so.
The interpretation of the scope of the power delegated to the United States by the Commerce Clause obviously affects the quantum of rights reserved to the states or to the people under the Tenth Amendment.[7] However, no one can argue in good faith that the power to regulate commerce was not within the range of the power "delegated to the United States by the Constitution," as that phrase is used in the Tenth Amendment in setting out that which is within the sovereignty of the United States.
Charges of abuse of power once conferred are fundamentally different from allegations of usurpation of power. Mundane questions of statutory construction are simply not comparable to issues of extension of the Constitution into new territory by judicial fiat rather than through an amendment ratified by the people. No amount of hyperbole about the sacred right to trial by jury can escalate Terminix into a category beyond its status as a case involving construction by the United States Supreme Court of an act of Congress in a sphere where it undisputedly has the power to act. To be sure, the construction adopted in Terminix gives teeth to arbitration agreements so that parties who contract away their right to a jury trial will now have to live with their bargain. If this result works a miscarriage of justice, the fault lies with the legislative body that enacted the FAA, and not with the judiciary.
What if one accepts that the decision in Terminix is an assault on fundamental rights? Does this conclusion require that we, as state court judges, whose oath is to the Constitution and the laws of the United *42 States enacted in pursuance thereof,[8] and not to the United States Supreme Court, must, in fidelity to discontent with judicial activism and to the strength of our own convictions, ignore the case in favor of the laws of the State of Alabama? But, if we do so, such inquiry into state law yields a mixed signal as to the acceptability of arbitration as an alternative means of dispute resolution. On the one hand, the Alabama Constitution of 1901 enshrines the right to trial by jury at § 11, but, on the other hand, at § 84, provides that "[i]t shall be the duty of the legislature to pass such laws as may be necessary and proper to decide differences by arbitrators to be appointed by the parties who may choose that mode of adjustment." A provision empowering the legislature to pass laws to effectuate agreements to arbitrate has been a part of every Alabama Constitution since statehood. The legislature has discharged this duty by enacting Ala.Code 1975, § 6-6-1 et seq., to provide a system of arbitration parties may choose to avail themselves of after a dispute has arisen. However, the legislature also has exercised its power in this area by making predispute arbitration agreements unenforceable; see § 8-1-41.
This Court has stated that § 84 is merely "directory," in a case challenging the provisions of now superseded statutes providing for umpires to fix the value of improvements upon redemption of real property. Stevenson v. King, 243 Ala. 551, 10 So. 2d 825 (1942). Moreover, early on this Court agreed with the legislature that predispute arbitration agreements are void on "public policy" grounds. See Bozeman v. Gilbert, 1 Ala. 90 (1840). Since then, the Court has continued to embrace a dichotomous public policy argument that encourages arbitration as a means of alternative dispute resolution, but disdains predispute arbitration agreements that would oust our courts of their jurisdiction. Wells v. Mobile County Bd. of Realtors, 387 So. 2d 140 (Ala.1980).[9]
The Court's treatment of § 84 in Stevenson as "directory" is not accompanied by citation to authority. I note that, for purposes of construing the Constitution, the word "shall" is presumptively mandatory unless something in the character of the provision being construed requires that it be considered differently. Hornsby v. Sessions, 703 So. 2d 932 (Ala.1997). Section 84 specifies that "[it] shall be the duty of the legislature...." (Emphasis added.) Moreover, the evils of transplanting the rules of construction that distinguish between mandatory and directory statutes into the realm of constitutional provisions have long been recognized. See Perry County v. Selma, M. & M.R.R., 58 Ala. 546 (1877) (stating that such activity took a court into "dangerous ground," and citing Cooley, Constitutional Limitations). Perry County was cited with approval in Gafford v. Pemberton, 409 So. 2d 1367 (Ala.1982).
Has the legislature frustrated the will of the people, as set out in § 84, by enacting a law that is hostile to predispute arbitration? Or, has the legislature done what is "proper and necessary" by enacting § 6-6-1 et seq. as an alternative form of dispute resolution, while also enacting § 8-1-41 as a safeguard to the right to jury trial? If this Court is given the opportunity to address the implications of § 84 and, in doing so, determines that Stevenson incorrectly treats § 84 as directory, the Court will again be faced with the proper role of stare decisis when a constitutional construction is found to be incorrect.[10]
*43 These issues of state law are intriguing, but they are for another day. In the meantime, until Congress[11] should amend the FAA, I will continue to apply that Act to the cases coming before me; my application of the Act will be consistent with the principles of construction of the Act laid down by the Supreme Court of the United States, and I will apply the Act with a clear conscience on the issue of consistency with deeply held principles of constitutional law.
Turning to issues of state law in the instant case, I do not find the plea of financial hardship in the area of arbitration to be totally irrelevant to the issue of enforceability of an arbitration agreement. The FAA, 9 U.S.C. § 2, expressly carves out a zone of primacy of state law by authorizing prohibition of enforcement of an arbitration clause that is invalid, "upon such grounds as exist at law or in equity for the revocation of any contract." Alabama has long recognized the doctrine of unconscionability as a defense to enforcement of a contract. See, e.g., Keeble v. Keeble, 85 Ala. 552, 5 So. 149 (1888). While Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 U.S. 395, 87 S. Ct. 1801, 18 L. Ed. 2d 1270 (1967), relegates challenges to the validity of the contract as a whole to the arbitrator, a challenge to the arbitration clause only is properly determined by the court. Wheat, First Securities, Inc., v. Green, 993 F.2d 814 (11th Cir.1993); Rhode v. E & T Investments, Inc., 6 F. Supp. 2d 1322 (M.D.Ala.1998); Rollins, Inc. v. Foster, 991 F. Supp. 1426, 1431 (M.D.Ala.1998).
As noted by Judges Ira DeMent and Myron Thompson, respectively, in Rhode and Rollins, unconscionability, under general principles of Alabama law, can be reduced to a four-part test: (1) whether there is an absence of meaningful choice on one party's part; (2) whether the contractual terms are unreasonably unfavorable to one party; (3) whether there was unequal bargaining power between the parties; and (4) whether the contract contained oppressive, one-sided, or patently unfair terms. Layne v. Garner, 612 So. 2d 404, 408 (Ala.1992).
I believe that a showing of financial hardship, lack of choice, and one-sidedness could, in a proper case, lead to a finding of unconscionability and a concomitant holding of unenforceability of an arbitration agreement that would not conflict with governing federal law. It is hornbook law that an arbitration agreement will not be enforced against one who has not agreed to arbitrate a dispute, A.G. Edwards & Sons, Inc. v. Clark, 558 So. 2d 358 (Ala.1990), and lack of choice is an important factor in a finding that a contract is unconscionable. Layne v. Garner, supra. Because § 84 turns on the parties' making a choice in favor of arbitration, it would appear that application of the doctrine of unconscionability would not offend § 84. However, in the instant case, only one component, financial hardship, is implicated and, standing alone, that factor is simply insufficient to either displace, or to justify rewriting, the agreement between the parties.
[1] The "Retail Buyer's Order," attached as exhibit "A" to Tucker's petition, provides: "[I]n the event any dispute(s), under the terms of this contract of sale arise ... Dealer and the purchaser agree to submit such dispute(s) to binding arbitration, pursuant to the provisions of [9 U.S.C. § 1 et seq.] and according to the commercial rules of the American Arbitration Association then existing, in Birmingham, Alabama."
[2] We would also add that recently the American Arbitration Association announced its intention to ensure that the costs of arbitration are reasonable, by adopting the following "principle":
"PRINCIPLE 6. REASONABLE COST.
"1. Reasonable Cost. Providers of goods and services should develop ADR [alternative dispute resolution] programs which entail reasonable cost to Consumers based on the circumstances of the dispute, including, among other things, the size and nature of the claim, the nature of goods or services provided, and the ability of the Consumer to pay. In some cases, this may require the Provider to subsidize the process.
"2. Handling of Payment. In the interest of ensuring fair and independent Neutrals, the making of fee arrangements and the payment of fees should be administered on a rational, equitable and consistent basis by the Independent ADR Institution."
[3] Justice Kennedy concurred in the result, without writing, and thereby cast the fifth vote to affirm the judgment of the trial court.
[4] This fee schedule became effective July 1, 1996.
[5] The parties have not suggested that the Federal Arbitration Act, 9 U.S.C. § 1 et seq., is inapplicable.
[6] 9 U.S.C. § 2.
[7] "The powers not delegated to the United States by the Constitution, nor prohibited by it to the states, are reserved to the states respectively, or to the people." U.S. Const. amend. X.
[8] U.S. Const. art. VI.
[9] Kentucky has the same constitutional provision concerning arbitration that we have. The judge-made "ouster of jurisdiction" doctrine that prevents arbitration of future disputes is not part of the fundamental policy of Kentucky. Kodak Min. Co. v. Carrs Fork Corp., 669 S.W.2d 917 (Ky. 1984), after remand, review denied, 809 S.W.2d 699 (Ky.1991).
[10] This Court recently confronted the issue in James v. Langford, 695 So. 2d 1158, rehearing denied, 695 So. 2d 1164 (Ala.1997) (See, J., dissenting).
Justice Hugo L. Black believed strongly that stare decisis had no role in matters of constitutional error. In defending the Supreme Court's duty to strike down even long-standing misconstructions of the Constitution, he stated:
"That decision [striking down a century-old rule as unconstitutional] rested upon the sound principle that the rule of stare decisis cannot confer powers upon the courts which the inexorable command of the Constitution says they shall not have. State obedience to an unconstitutional assumption of power by the judicial branch of government, and inaction by the Congress, cannot amend the Constitution by creating and establishing a new `feature of our constitutional system.' No provision of the Constitution authorizes its amendment in this manner."
Gwin, White & Prince, Inc. v. Henneford, 305 U.S. 434, 454-55, 59 S. Ct. 325, 83 L. Ed. 272 (1939) (Black, J., dissenting).
[11] Under the reverse preemption of the McCarran-Ferguson Act, 15 U.S.C. § 1011 et seq., state autonomy over matters of insurance is permitted. The Alabama legislature, if it saw fit, could, subject to § 84, restrict arbitration in insurance disputes without violating federal law. | d5830f7c2fd54325dc2305c79f11427f6d6ed6d69eecd5a272e14d180be18c4f | 1998-07-02 00:00:00 |
d8756b8a-1cab-4922-a166-bbf4acb00bfd | Ex Parte Green Tree Financial Corp. | 723 So. 2d 6 | 1962148 | Alabama | Alabama Supreme Court | 723 So. 2d 6 (1998)
Ex parte GREEN TREE FINANCIAL CORPORATION.
(In re Elbert J. Kilpatrick and Barbara J. Kilpatrick v. Green Tree Financial Corporation and American Bankers Insurance Company of Florida).
1962148.
Supreme Court of Alabama.
July 31, 1998.
Rehearing Denied October 23, 1998.
*7 Robert A. Huffaker and William H. Webster of Rushton, Stakely, Johnston & Garrett, P.A., Montgomery, for petitioner.
Joe R. Whatley, Jr., Russell Jackson Drake, and Frederick T. Kuykendall III of Cooper, Mitch, Crawford, Kuykendall & Whatley, Birmingham; T. Roe Frazer II and Richard A. Freese of Langston, Frazer, Sweet & Freese, P.A., Birmingham; E. Mark Ezell of Ezell & Sharbrough, L.L.C., Butler; Taylor T. Perry, Jr., of Manley, Traeger, Perry & Stapp, Demopolis; and J.L. Chestnut, Jr., of Chestnut, Sanders, Sanders & Pettaway, Selma, for respondents.
LYONS, Justice.
Green Tree Financial Corporation, the counterclaim defendant in an action pending in the Marengo Circuit Court, seeks a writ of mandamus directing that court to vacate its August 12, 1997, order, certifying a nationwide class of plaintiffs and an Alabama subclass. We grant the writ.
Green Tree Financial Corporation ("Green Tree") executed a contract with Elbert Kilpatrick and his wife Barbara Kilpatrick by which Green Tree lent the Kilpatricks money to purchase a mobile home in Mississippi. The contract granted Green Tree a security interest in the mobile home, and it required that the Kilpatricks maintain physical damage insurance for the mobile home. The contract provided that, if the Kilpatricks failed to keep the mobile home insured, Green Tree would purchase collateral protection insurance (CPI) and charge the cost of the insurance to the Kilpatricks' account.
The Kilpatricks subsequently failed to maintain insurance on the mobile home, and Green Tree purchased a CPI policy from American Bankers Insurance Company of Florida ("American Bankers"). The Kilpatricks ultimately defaulted on the installment contract, and Green Tree filed a detinue complaint against them, seeking possession of the mobile home. The Kilpatricks counterclaimed, alleging that Green Tree had improperly "force-placed" the CPI policy on their account and that the policy amount was excessive because it insured the mobile home for its purchase price, rather than for its depreciated value. The Kilpatricks sought damages on claims of fraud, breach of contract, breach of duty, civil conspiracy, negligence, and wantonness. The Kilpatricks also sought certification of a plaintiff class composed of Alabama residents who had purchased mobile homes through loan agreements with Green Tree and who had had physical damage insurance force-placed on the collateral in an amount equal to the original sale price of the mobile homes.
The Kilpatricks subsequently amended their counterclaim, restating their claim alleging breach of contract; and adding claims alleging breach of an implied contract to exercise reasonable skill, care, and diligence in providing insurance; and breach of a duty of "good faith and loyalty" relating to an alleged placement of useless or unauthorized insurance. The Kilpatricks amended their *8 counterclaim a second time to seek certification of a nationwide class of (1) all persons who had been charged for force-placed insurance, regardless of whether the amount insured was the sale price of the mobile home or was some other figure, and (2) all persons who had been charged for, but had not paid for, force-placed insurance.
After a hearing, the trial court entered an order conditionally certifying the class.[1] Green Tree petitioned this Court for a writ of mandamus directing the trial court to vacate the certification order, arguing that the Kilpatricks had not met the criteria set out in Rule 23, Ala. R. Civ. P., for the certification of a class. We granted the petition in Ex parte Green Tree Financial Corp., 684 So. 2d 1302 (Ala.1996), holding that the trial court had failed to make the findings necessary to determine whether the class should be certified under Rule 23(a) and that the Kilpatricks had failed to present evidence sufficient "to determine whether a class of Alabama plaintiffs would be too narrow, or whether a class of nationwide plaintiffs would be too broad, or if a class action is maintainable in the first instance." 684 So. 2d at 1309.
In response to that 1996 opinion of this Court, the trial court set aside its order certifying the class. The Kilpatricks subsequently renewed their motion for class certification, but they altered the motion to broaden the scope of the purported class, seeking certification of a nationwide class of persons who had loans with Green Tree, not limited to persons who had force-placed insurance. Green Tree opposed the motion, pointing out that, under applicable conflict-of-law rules, the court would have to determine and apply the law of all 50 states for each of the Kilpatricks' claims in order to resolve the claims of the nationwide class. Green Tree further argued that, whatever the outcome of the Kilpatricks' class certification motion, the class definition they had proposed was impermissibly overbroad because it purported to include persons who did not have force-placed insurance and to include persons whose claims had arisen outside the applicable limitations period of their own states. Green Tree also emphasized that the motion purported to include a large number of persons who had arbitration agreements in their installment sales contracts and had thus, at least arguably, contracted to arbitrate, rather than to litigate, their claims against Green Tree.
The trial court subsequently granted the Kilpatricks' motion, holding, in pertinent part:
Green Tree moved the trial court to vacate the class action order, arguing that the Kilpatricks had not carried their burden of proving that each of the requirements for Rule 23 class certification is met in this case. The trial court denied these motions, and Green Tree filed this mandamus petition.
A petition for the writ of mandamus is the proper means for obtaining review of the trial court's certification of a class. Ex parte Green Tree Fin. Corp., 684 So. 2d at 1305. Every class certification order must, at a minimum, identify each of the four elements of Rule 23(a) and explain in detail how the proponents of the class have proven each of these elements, as well as at least one of the additional elements of Rule 23(b). Ex parte Equity Nat'l Life Ins. Co., 715 So. 2d 192 (Ala.1997). The evidentiary underpinnings that must support a trial court's certification order necessarily include findings as to the criteria of Rule 23(a) and at least one of the criteria set out in Rule 23(b). Id.
Rule 23(b)(3) requires a finding that the questions or law or fact common to the members of the class predominate over any questions affecting only individual members and that a class action is superior to other available methods for the fair and efficient adjudication of the controversy. To make this determination of "predominance" and "superiority," the trial court should consider:
Rule 23(b)(3).
In determining whether the questions of law or fact common to the class members predominate over those questions that affect only individual class members, the court must initially identify the substantive law applicable to the case and identify the proof that will be necessary to establish the claim. Alabama v. Blue Bird Body Co., 573 F.2d 309, 316 (5th Cir.1978). This consideration is particularly important in cases where one or more of the claims will require proof of subjective factors, and where the putative class is a nationwide class and thus requires the individual applications of divergent state laws; in a multistate class action, variations in state law may swamp any common issues and defeat a finding of predominance. Castano v. American Tobacco Co., 84 F.3d 734 (5th Cir.1996). Moreover, the greater the number of individual issues, the less likely it is that a court may properly find that a class action is the superior means of litigating the plaintiff's claims. In re American Medical Sys., 75 F.3d 1069 (6th Cir.1996).
*10 The Kilpatricks, on behalf of a purported nationwide class, have asserted claims based on allegations of fraud, civil conspiracy, breach of contract, breach of duty, negligence, and wantonness. Although the Kilpatricks assert all of their claims under Alabama law, the majority of the members of the purported class are nonresidents whose alleged claims arose in their own states; at least some of these claims will be governed by the laws of those other states. Ex parte Owen, 437 So. 2d 476 (Ala. 1983) (Alabama follows the traditional view that a contract is governed by the law of the state where it is made); Norris v. Taylor, 460 So. 2d 151 (Ala.1984) (tort claims are governed by the law of the state where the alleged injury occurred). For example, to adjudicate the fraud claim, the trial court would apply differing state laws as to the element of reliance and it would have to consider differences in various states' consumer-protection codes and deceptive-trade-practices statutes. It would also apply differing statutes of limitations and would have to consider differences in the defenses available to the defendant and differences from state to state in the evidence necessary to support an award of punitive damages. It would have to consider whether an award of punitive damages is even allowed in certain states. As to the breach-of-contract claim, while the contract at issue uniformly gives Green Tree the right to force-place insurance, it does not specify how much insurance is allowable; thus, the court would be required to apply differing laws of the various states to the issues of parol evidence, the parties' course of dealing, and general rules of contract interpretation. Likewise, the court would be required to apply varying state laws as to the evidence that is necessary to support the plaintiffs' wantonness claims.
Moreover, some, if not all, of the claims will present individual issues that require subjective proof; those issues threaten the predominance of the common issues. Although the Kilpatricks argue that Green Tree's alleged fraud in force-placing insurance upon its customers was generally carried out with written notices stating what the amount of the insurance would be, and argue that the fraud was thus uniform, there are still individual issues as to the element of reliance upon these written representations.[2] If this case proceeded as a class action, then the breach-of-contract claim would present issues calling for the factfinder to ascertain the intent of the parties and to consider the course of dealing between the parties. Moreover, the Kilpatricks have sought to include in their class persons who signed arbitration agreements; determining the validity of each arbitration agreement may present additional individual issues in this case. There is also the issue whether one who signed a valid arbitration agreement may properly be included in the class action.[3]
The plaintiffs have the burden to demonstrate that a class certification is proper under Rule 23, Ex parte Blue Cross & Blue Shield, 582 So. 2d 469 (Ala.1991), and thus to show that a class certification is the superior method for litigating their claims and that individual issues will not overwhelm the common issues of the class. The trial court may not merely rely on assurances of counsel that any problems with predominance or superiority arising from variations in state law can be overcome. Alabama v. Blue Bird Body Co., supra; Castano, supra.
To support their motion to certify their counterclaim as a class action, the Kilpatricks presented a chart showing which jurisdictions agree upon the elements of a breach-of-contract *11 action; however, they presented no evidence as to the variances in the laws of the several states on such related issues as the statute of limitations for a breach of contract claim, the admissibility of parol evidence, or the defenses available. The Kilpatricks also presented a diagram showing which states recognize both fraud by nondisclosure and fraudulent concealment; however, they did not submit a similar chart to show the differences in state law as to the elements of misrepresentation, particularly the element of reliance. Additionally, the Kilpatricks failed to address the variations in the states' recognition of the availability of punitive damages.
The Kilpatricks submitted the affidavit of T. Roe Frazer II, an attorney residing in Mississippi. His affidavit tended to show that he is an experienced attorney who has served as lead counsel for plaintiffs in complex class litigation and that he was competent to act as counsel in regard to the Kilpatricks' claims. Attached to Frazer's affidavit were a number of unpublished orders from trial courts in other jurisdictions certifying, or in some cases refusing to certify, various class actions. These orders were offered without an accompanying explanation of their relevance; however, we note that most of them appear to involve single claims, rather than a mixture of tort and contract claims such as is presented in this present case.
In response to this evidence, the trial court summarily determined that the Kilpatricks had met the requirements of Rule 23(b) and that a nationwide class action is the superior method for adjudicating the claims made in this case. It did so without identifying the variations in state law presented by the fact that this certification would create a nationwide class of plaintiffs, and without identifying the substantive law issues that would control the outcome of the litigation and that could effectively convert this purported class action into a multitude of individual cases. The trial court also conditionally certified a subclass of Alabama plaintiffs, some of whom had signed arbitration agreements with Green Tree, without addressing the question of manageability or the propriety of including these persons in litigation.
We are mindful that the certification of this case is conditional; however, even though Rule 23(b)(3) requires that a class should be certified as soon as practicable, "it does not follow that the rule's requirements are lessened when the class is conditional." Castano v. American Tobacco Co., 84 F.3d at 741. The lack of evidence as to the issues of predominance and superiority under Rule 23(3)(b), and the lack of findings as to these issues, compel us to determine that the requirements of a conditional certification were not met in this case. Indeed, we have grave concerns as to whether any national class of plaintiffs in an action involving the application of the differing laws of numerous states can satisfy the requirements of showing that "the questions of law or fact common to the members of the class predominate over any questions affecting only individual members, and that a class action is superior to other available methods for the fair and efficient adjudication of the controversy." Rule 23(b)(3).
We grant Green Tree's petition for the writ of mandamus. The Circuit Court of Marengo County is directed to vacate its August 12, 1997, order conditionally certifying a class.
PETITION GRANTED.
HOOPER, C.J., and MADDOX, HOUSTON, and SEE, JJ., concur.
[1] Because the "class action" aspects of this case arose from the Kilpatricks' counterclaim, the Kilpatricks are "counterplaintiffs" and the certification was of a "counterplaintiff" class. The record does not show whether Green Tree's original detinue action has been resolved. However, we will hereinafter refer to the Kilpatricks as "plaintiffs" and to the class as a "plaintiff class."
[2] The Kilpatricks have made a claim of misrepresentation, as well as a claim of fraudulent suppression. We note that the difficulties posed by attempting to certify a class where the claims require proof of subjective factors are typical in fraud cases; thus, courts have been reluctant to find fraud claims suitable for class certification. "[A]lthough [the separate representations presented in a fraud case may have] some common core, [the] case may be unsuited for treatment as a class action if there was material variation in the representations made or in the kinds or degrees of reliance by the persons to whom they were addressed." Committee comments, Rule 23(b)(3), Fed.R.Civ.P.
[3] Arbitration agreements cannot be forced into the mold of class-action treatment without defeating the parties' contractual rights; a rule of civil procedure providing for class actions cannot overcome binding arbitration agreements. See Champ v. Siegel Trading Co., 55 F.3d 269 (7th Cir.1995). | 6feb738fbdb4c66dbde17d41344b06770ee8b96a072fc4f6d92275df14e78c56 | 1998-07-31 00:00:00 |
5b5384f4-cc17-4610-9630-66f68f6f30bb | Green v. Dixon | 727 So. 2d 781 | 1970218 | Alabama | Alabama Supreme Court | 727 So. 2d 781 (1998)
Rosa S. GREEN and the estate of Lucille Green Dawsey
v.
Frederick DIXON, Jr., et al.
1970218.
Supreme Court of Alabama.
June 19, 1998.
Rehearing Denied February 12, 1999.
Wayne P. Turner of Turner, Wilson & Sawyer, Montgomery, for appellants.
Robert P. Denniston of Brown, Hudgens, P.C., Mobile; Joseph C. McCorquodale III of McCorquodale & McCorquodale, Jackson; Joseph W. Hutchinson III, Butler; and Timothy C. Hutchinson, Butler, for appellees.
Debra H. Coble and Michael A. LeBrun of Potts & Young, L.L.P., Florence, for Parker defendants/cross-claimants.
*782 HOOPER, Chief Justice.
Rosa Green and the estate of Lucille Green Dawsey appeal from a summary judgment declaring that they had no interest in certain real property and the underlying minerals. We reverse and remand.
In 1933, the tax collector of Choctaw County conducted a tax sale of four parcels of real estate totalling 112 acres. The land had been owned by John L. Parker. John L. Parker was never personally served with notice of the tax sale. Service was accomplished through publishing the notice for three weeks in the local newspaper and by posting it in the county courthouse. The tax sale occurred on August 7, 1933; the property was sold to John Green, Sr., for $34.03. On August 10, 1933, the probate judge of Choctaw County executed a tax deed to John Green, Sr., conveying to him Parker's interest in the property. Green recorded the deed two days later.
It is undisputed by the parties that John Green, Sr., did not take possession of this property and that his legatees did not take possession following his death in 1939. At least two of the four parcels continued to be assessed for ad valorem taxes by John L. Parker until Parker died in 1935. From 1936 to 1988, the subject property was assessed by Parker's widow, her estate, and her heirs. In 1944, Mary Green, the widow of John Green, Sr., and the executrix of his estate, signed a deed conveying the subject property to five of John Parker's children. This deed reserved to the estate of John Green, Sr., an undivided ½ interest in the minerals underlying the subject property. This ½ interest was later conveyed by the estate to Mary Green, John Green, Jr. (the husband of Rosa Green), Lucille Green Dawsey, and Bettye Rankin Green. It is the ownership of this ½ mineral interest that is disputed in this case.
In 1970, John Green, Jr., and Rosa Green signed a mineral lease allowing an oil company to extract oil and gas from the subject property in exchange for royalty payments.[1] Lucille Green Dawsey also leased her interest to the same company by a separate contract. Rosa Green and the estate of Lucille Green Dawsey claim that drilling began on the subject property in 1971. Royalty payments were made to the lessors until this action was filed in 1986. Since 1986, a number of Parker descendants and their assignees have been embroiled in complex litigation with the Green descendants and their assignees over the true ownership of the property and its underlying minerals. This appeal, however, is limited to the trial court's disposition of a motion for summary judgment made by Rosa Green and the estate of Lucille Green Dawsey ("the Greens") relating to ownership of the ½ mineral interest in the subject property.
The trial judge denied the summary judgment motion filed by the Greens, but entered a summary judgment for the Parker heirs and the assignees of one of the Parker heirs (although they had not moved for a summary judgment).[2] He first ruled that the 1933 tax sale and the tax deed to John Green, Sr., were void for lack of proper notice. He then held that the Greens could not take advantage of what is commonly known as the "short statute of limitations" for tax sales. The current version of this limitations provision appears at § 40-10-82, Ala.Code 1975; it provides in relevant part:
*783 The version of the statute in effect at the time of the 1933 tax sale, § 3107, Ala.Code 1923, is identical to the present statute with one exception. Section 3107 specifically exempted void sales from the operation of the short statute of limitations.[3] The trial court applied § 3107, holding that the short statute of limitations provided no protection for the Greens because the original sale was void. The court stated that even if the sale had been valid, title would have vested in the Parker heirs by virtue of the failure of John Green, Sr., to bring an action for possession of the property before the three-year statutory period expired.
The trial court also rejected the Greens' claim to ownership of the ½ mineral interest through adverse possession under § 6-5-200, Ala.Code 1975. The basis of this ruling was that the void tax deed did not provide color of title to the Greens. The court reasoned that, if the void tax deed did not constitute color of title under § 3107, then it could not logically constitute color of title for the purposes of § 6-5-200 either. In the alternative, the court held, the Greens did not have color of title because the failure of John Green, Sr., to bring a timely action for possession had caused title to vest in the Parker heirs. For these reasons, the trial court ultimately held that the Greens had no interest in the disputed mineral rights.
The summary judgment in this case is somewhat atypical. It was entered for the Parker heirs and assignees even though they had not moved for a summary judgment. However, it is entirely within the power of the trial court to enter a summary judgment for a party despite the fact that the motion for summary judgment has been filed by an opposing party. This Court wrote in 1982: "Even though it would be better practice for an opposing party to file a cross motion, ... we hold that in the absence of a timely and meritorious objection, there is no reason why, upon the motion of one of the parties, the court cannot dispose of the whole matter by granting a judgment to the other party if it finds that there is not a scintilla of evidence supporting the moving party's position, thus showing the non-moving party to be entitled to a judgment as a matter of law." Adam v. Shelby County Commission, 415 So. 2d 1066, 1068 (Ala.1982). In order for the Parker heirs and assignees to receive a judgment as a matter of law, they were required to show that no genuine issue of material fact existed. This present action was filed before the Legislature abolished the "scintilla rule" in 1987 by the adoption of § 12-21-12, Ala. Code 1975. Therefore, if they made a prima facie showing that there was no such issue, then the opposing parties (the Greens) would have been required to present at least a scintilla of evidence in their favor creating a genuine issue of material fact. Hutchins v. State Farm Mut. Auto. Ins. Co., 436 So. 2d 819, 825 (Ala.1983).
Although the litigation between these parties is rather convoluted, the issue before this Court is a narrow one: Did the void tax deed provide the Greens with color of title under § 6-5-200? The invalidity of the tax sale and the tax deed is undisputed. The Greens have also abandoned any claim that the short statute of limitations entitles them to possession of the mineral interests.
Simply put, color of title is a writing that appears to transfer title but that in reality does not. Bradley v. Gordon, 240 Ala. 556, 200 So. 736 (1941); Bowles v. Lowery, 181 Ala. 603, 62 So. 107 (1913). Under § 6-5-200(a)(1), color of title, as opposed to a rightful claim to title, requires only that a deed or other writing purporting to convey title be recorded in the probate office of the county where the land lies and that it has been recorded for 10 years before the action is filed. Lewis v. Hardin, 512 So. 2d 96 *784 (Ala.1987). Color of title is only a facadeit is the appearance that matters and not what is behind it. Generally, even a defective, irregular, or void deed can constitute color of title. "Any instrument purporting to convey an interest in land may be color of title, however defective or imperfect it is, and no matter from what cause it is invalid," Edmonson v. Colwell, 504 So. 2d 235, 236 (Ala. 1987), citing Van Meter v. Grice, 380 So. 2d 274 (Ala.1980). Moreover, void tax deeds have specifically been held to furnish color of title. Turnham v. Potter, 289 Ala. 685, 271 So. 2d 246 (1972); Pierson v. Case, 272 Ala. 527, 133 So. 2d 239 (1961); Brannan v. Henry, 142 Ala. 698, 39 So. 92 (1905). Certainly, the tax deed to John Green, Sr., appeared to convey title to the subject property. It was recorded in 1933; thus, the 10-year requirement was easily met. The tax deed, while not a valid title itself, thus appears to have the attributes necessary to constitute color of title.
The trial court, however, held that the specific exclusion of void tax sales under § 3107 stripped the tax deed of any status, including that of color of title. The trial court's order read:
This holding is erroneous for several reasons. First, § 3107 is the wrong statute to apply in this case. In Odom v. Averett, 248 Ala. 289, 27 So. 2d 479 (1946), this same statute was at issue; the Court held it inapplicable, stating:
248 Ala. at 291, 27 So. 2d at 480. Thus, the proper statute of limitations to apply is the statute currently in force, § 40-10-82, Ala. Code 1975.[4] That statute does not expressly exclude void sales and, accordingly, does not support the proposition that a void tax deed cannot constitute color of title.
Second, even if § 3107 were the proper statute to apply, we would find the trial court's reading of it to be overly broad and unreasonably prohibitive. The trial court interpreted § 3107 to bar any use whatever of the tax deed by the tax purchaser. However, in enacting § 3107, the Legislature provided only that it would not apply to void sales. Nowhere in the statutory language did the Legislature express an intention to deprive a tax purchaser of the color of title provided by a void tax deed.
The trial court reasoned that if a void tax deed could not provide color of title under § 3107, then it likewise could not provide color of title under the adverse possession statute, § 6-5-200. In light of our decision that § 3107 has no bearing on this case and, in any event, does not prevent a void tax deed from furnishing color of title, then certainly a void tax deed can furnish color of title for the purpose of adverse possession.
We would also note that we disagree with the trial court's alternative conclusion that the Greens cannot claim color of title because no action for possession was ever brought and title was thus vested in the Parker heirs and assignees. While the Greens are certainly barred from claiming title as of right, because of the short statute *785 of limitations, they are not barred from claiming that they hold mere color of title. We agree with the Greens that the character of the tax deed is not changed by the expiration of the period provided by the short statute of limitations. Therefore, we conclude that the void tax deed to John Green, Sr., provided color of title to the Greens for the purposes of § 6-5-200.
The fact that the Greens can claim color of title through the void tax deed does not automatically validate their claim of ownership through adverse possession. To succeed with their claim under § 6-5-200(a)(1), they must still show that their possession of the subject property was open, notorious, hostile, continuous, and exclusive for the statutory period. Harper v. Smith, 582 So. 2d 1089 (Ala.1991). However, the trial court's order did not address these other elements of adverse possession. The trial court relied exclusively on the Greens' supposed lack of color of title. Therefore, the case is remanded for the trial court to determine if the Greens met their burden of demonstrating that there was no genuine issue of material fact as to whether they adversely possessed the ½ mineral interest.
Because the Parker heirs and assignees were not entitled to a judgment as a matter of law, the summary judgment is reversed. The cause is remanded for further proceedings consistent with this opinion.
REVERSED AND REMANDED.
MADDOX, HOUSTON, KENNEDY, and LYONS, JJ., concur.
SEE, J., concurs in the result.
[1] In 1976, John Green, Jr., conveyed his interest in the subject property to his wife, Rosa S. Green.
[2] The appellees in this case are the heirs of John Parker and a group the trial court referred to as "the Christopher Group." The Christopher Group claims an interest in the subject property through a deed from John Parker's son to W.S. Scruggs. Because all of the appellees at some point derive their interest in the property from John Parker, they will be collectively referred to as "the Parker heirs and assignees."
[3] The portion of § 3107 providing exceptions to the short statute of limitations reads:
"[B]ut this section shall not apply to any action brought by the state; nor to cases in which the owner of the real estate sold had paid the taxes, for the payment of which such real estate was sold, prior to such sale; nor shall they [sic] apply to cases in which the real estate sold was not, at the time of the assessment, or of the sale, subject to taxation, nor shall it apply to void sales."
(Emphasis added.)
[4] We note that even when we apply the correct short statute of limitations, the Greens are still barred under that section because no action for possession was brought within the three-year limitations period. | ce38c6c29837284015af9eba23894b03ab78a05ac9d4802755ed688c8f5e1a87 | 1998-06-19 00:00:00 |
fd2f078c-db5d-46b5-a311-179eaa305c07 | Knutson v. Bronner | 721 So. 2d 678 | 1951233, 1951355 | Alabama | Alabama Supreme Court | 721 So. 2d 678 (1998)
Gerald KNUTSON et al.
v.
David G. BRONNER, individually and as chief executive officer of the Retirement Systems of Alabama.
David G. BRONNER, individually and as chief executive officer of the Retirement Systems of Alabama
v.
Gerald KNUTSON et al.
1951233, 1951355.
Supreme Court of Alabama.
July 24, 1998.
George C. Douglas, Jr., Birmingham, for appellants/cross appellees Gerald Knutson et al.
William T. Stephens, general counsel, and William F. Kelley, Jr., associate counsel, Retirement Systems of Alabama, for appellee/cross appellant David G. Bronner, individually and as chief executive officer of the Retirement Systems of Alabama.
PER CURIAM.
The main issue presented by these appeals is whether citizen taxpayers and a political committee have standing to sue the chief executive officer of the Retirement Systems of Alabama ("RSA") for an alleged misuse of RSA funds to encourage RSA members living in Montgomery County to vote in a local referendum to increase taxes. That depends on whether funds of the RSA are "state funds."
Two individuals, Gerald Knutson and Terry Smith, as citizens and taxpayers of the State of Alabama; and a political committee, the Taxpayers' Defense Force, sued David Bronner, the chief executive officer of the RSA. They sought to recover what they alleged were "state funds" that they claimed Bronner had expended in violation of § 17-1-7, Ala.Code 1975.[1] In their complaint, the plaintiffs asked the trial court to order Bronner to reimburse the RSA approximately $6,000 and to enjoin him permanently from engaging in any future political activity in violation of § 17-1-7. Bronner counterclaimed, seeking to recover from the plaintiffs a fine provided by § 17-22A-22, Ala. Code 1975, for an alleged violation of the Fair Campaign Practices Act. The trial court entered a summary judgment in favor of Bronner on the plaintiffs' claims, holding that the plaintiffs did not have standing to challenge the expenditure of RSA funds, but also entered a summary judgment in favor of the plaintiffs on Bronner's counterclaim, on the ground that the court did not have jurisdiction to enforce a criminal fine in a civil lawsuit. Because we hold that the plaintiffs did not have standing in this case, and because we hold that Bronner may not in a civil action enforce a statute assessing a criminal fine, we affirm both the summary judgments.
Bronner distributed a memorandum on RSA stationery in June 1994, over his signature as chief executive officer of the RSA, in which he urged RSA members living in Montgomery County to vote, in a local referendum, in favor of increasing ad valorem taxes for the support of public education. It is undisputed that RSA employees copied the memorandum and mailed it to RSA members and in doing so used postage purchased by the RSA.
Bronner's counterclaim alleged that, on June 17, 1994, the Taxpayers Defense Force received a $15,000 contribution for the express purpose of campaigning against the ad valorem tax increase, and that the Taxpayers Defense Force had not filed a statement of organization of a political committee, as required by the Fair Campaign Practices Act. See § 17-22A-5, Ala.Code 1975.[2] Because they had not filed the reports required by law, Bronner asserted that the plaintiffs were liable for the statutory fine imposed by § 17-22A-22, and, that, under § 6-5-50, he was entitled to recover the statutory penalty on behalf of the State.
We first discuss whether the plaintiffs have standing to sue. The plaintiffs' main argument is that RSA funds are "state funds" and that they, therefore, have standing to prevent the illegal expenditure of those funds. Bronner counters that RSA funds are not "state funds," as that phrase has been used in our cases dealing with taxpayer standing. Bronner points out that neither of the individual plaintiffs nor the political committee is a member of the RSA with a vested interest in RSA funds, and he thus argues they have no cognizable interest sufficient to authorize them to sue.
*680 The plaintiffs rely on Lee v. Bronner, 404 So. 2d 627 (Ala.1987), to support their argument that they have standing to sue. In Lee, this Court held that a member of the RSA, who had a direct pecuniary interest in RSA funds, had standing to sue. This Court also noted in that case that a taxpayer's standing is broad and that taxpayers are often the only persons who can bring a suit challenging the expenditure of state funds. Id. at 628-29. In Lee, however, this Court did not have to reach the specific issue presented here whether a taxpayer who is not a member of the RSA has standing to bring an action against the chief executive officer of the RSA.
The plaintiffs also rely on Hunt v. Windom, 604 So. 2d 395 (Ala.1992), in support of their argument on the standing question. In Hunt, "[t]he plaintiff, Ralph Windom, as a citizen and taxpayer of the State of Alabama, sued Governor Guy Hunt, alleging that he used state funds and resources to maintain a ministry and that his doing so violated the Constitution of Alabama." Id. at 395. In that case, this Court, relying on Zeigler v. Baker, 344 So. 2d 761, 763 (Ala.1977), reaffirmed its long line of cases regarding taxpayer standing, and held that the taxpayer had standing.[3]
To determine whether a taxpayer has standing, under the standard set out in Zeigler and in Goode v. Tyler, 237 Ala. 106, 186 So. 129 (1939) (cited in note 3), we first must determine whether the expenditures challenged in this case were from "state funds," as they clearly were in both of those cases. If RSA funds are not "state funds" within the meaning of Alabama's Constitution and statutes, then the principles of law applied in Zeigler and Goode v. Tyler would not apply here.
The plaintiffs claim that the funds in question are state funds because, they say, §§ 36-27-2(b) and 16-25-2(b) describe the RSA as an "instrumentalit[y] of the state funded by the state," and because that phrase is included in clauses that grant the RSA and its officers the same immunity the state and its officers have. The plaintiffs also rely upon the fact that employees of the RSA are state employees eligible for state retirement benefits.
The argument of the plaintiffs is a plausible one, but we believe we cannot look only to the cases of this Court where the nature of the funds involved was clear; we must also examine the constitutional provisions that govern the RSA and the funds held by the RSA, to determine the character of those funds. We begin by looking at the constitutional provision that governs the management, investment, and distribution of RSA funds.
In Amendment 472 of the Alabama Constitution of 1901, the people provided the following:
Although it might appear that the main question in this case whether funds held by the RSA are "state funds" was decided adversely to Bronner by this Court in Lee, the plaintiffs' reliance on Lee is misplaced, because the plaintiff in Lee had standing as a potential beneficiary of the trust. Goode v. Tyler is also distinguishable. A comparison of Goode with this present case helps to clarify the principal reason the plaintiffs in this case do not have standing. In Goode, a taxpayer sued, alleging that the commissioner of agriculture and industries had expended funds from the Agriculture Fund that were not authorized by law. The Agriculture Fund was established by Article 37 of the Agricultural Code of Alabama of 1927. Expenditures from the Agriculture Fund were under the control of the State Board of Agriculture. Agr.Code 1927, § 488. The Agriculture Fund was created by the Legislature for the sole purpose of paying for the "expenses of the regulatory control and administrative work of the Agricultural Section of the Department of Agriculture and Industries." Agr.Code 1927, § 487. In Goode, this Court recognized the standing of a taxpayer to challenge certain expenditures from the Agriculture Fund that had been authorized by the State Board of Agriculture.
Goode, however, presented a factual situation that is fundamentally distinct from that of the present case. In Goode, the Agriculture Fund was established by the Legislature, it existed at the will of the Legislature, and it was to be used for legislatively determined purposes, in accordance with procedures established by legislation. Agr.Code 1927, § 484 et seq. It follows, therefore, that the Legislature could have determined that, for whatever reason, it no longer wished for the Agriculture Fund to exist and it then could have terminated that fund through legislation. Here, the people, through their constitution, Amendment 472, have placed the funds of the RSA in trust; because of that constitutional provision, we hold that the funds in question in this case are not "state funds" as this Court has used that phrase in its earlier cases.
We hold that the people, in ratifying Amendment 472, intended that the assets of the RSA, which the record shows do not all come from the State but from many sources, including contributions from employers other than the State, interest income, and earnings on investments, are not "state funds" as that term is used in our taxpayer-standing cases and within the meaning of § 17-1-7, because the constitution provides that these funds are to be held, invested, and disbursed solely for the benefit of the members of the RSA.
In reaching this conclusion, it is not necessary for us to determine the outer limits of the Legislature's powers relating to these trust funds. Clearly, the Legislature has certain powers to regulate the administration of the funds, so long as the regulation does *682 not conflict with Amendment 472. We need not address what the Legislature can and cannot do. We merely hold that, for the purposes of this action, the plaintiffs, under current law, do not have standing,[5] because the funds involved are not "state funds" to the extent that a non-RSA member taxpayer would have standing to challenge their use.[6]
In his counterclaim, Bronner asserts that § 6-5-50, Ala.Code 1975, authorizes him to enforce a criminal fine against Knutson for failure to file a campaign report, in violation of the Fair Campaign Practices Act, § 17-22A-22. Section 6-5-50 provides:
(Emphasis added.) Section 17-22A-22(b) provides for the imposition of a fine of $1,000 or more for failure to file a statement of organization of a political committee. Section 17-22A-22(c) expressly provides that the attorney general, not a private party, is to bring a prosecution for violations of Title 17, Chapter 22A (the Fair Campaign Practices Act). Accordingly, § 6-5-50 does not authorize Bronner to recover a fine in this case.
Based on all of the foregoing reasons, the summary judgments are affirmed.
AFFIRMED.
HOOPER, C.J., and MADDOX, ALMON, SHORES, HOUSTON, and LYONS, JJ., concur.
KENNEDY, J., concurs specially.
COOK, J., concurs in the result.
SEE, J., concurs in part and dissents in part.
KENNEDY, Justice (concurring specially).
I agree that the funds in the Retirement Systems of Alabama ("RSA") are not "state funds."
It is clear from Amendment No. 472, Ala. Const.1901, that the state has no ownership of, or control over, funds held by the RSA. These funds are held in trust by the RSA for its members, for the payment of benefits promised, and they belong to those members. State employees have vested property rights created by § 16-25-2 and § 36-27-2, Ala. Code 1975, and the state cannot constitutionally impair or diminish those property rights. Under no circumstances can these funds revert to the state or be diverted by the Governor or the Legislature to fund other costs of state government.
Moneys earned by public employees and contributed to a public employees' retirement plan, including the employers' contribution, which has been earned by the public employees, become part of the corpus of the trust and, thereafter, cannot be used for any purpose other than that for which the moneys were entrusted. Once funds are paid into the RSA by the state, these funds lose their identity as state funds and become trust funds. See, e.g., West Virginia Trust Fund, Inc. v. Bailey, 199 W.Va. 463, 485 S.E.2d 407 *683 (1997); McCall v. State, 219 A.D.2d 136, 640 N.Y.S.2d 347 (1996).
The Teachers' Retirement System and the Employees' Retirement System were established by statutes that gave them the powers of public corporations, to invest and administer the funds and to hold them in trust for the payment of retirement benefits. See §§ 16-25-2 and 36-27-2, Ala.Code 1975, respectively. Under Alabama law, a public corporation is an entity separate from the state, and funds of public corporations are not state funds. See McBurney v. Ruth, 527 So. 2d 1265 (Ala.1988); Thomas v. Alabama Mun. Elec. Auth., 432 So. 2d 470 (Ala.1983); Alabama Hosp. Ass'n v. Dillard, 388 So. 2d 903 (Ala.1980).
Accordingly, the funds in the RSA are not "state funds," and the expenditure of those funds cannot be challenged by the plaintiffs, who are neither participants in, nor beneficiaries of, the retirement systems.[7]
SEE, Justice (concurring in part and dissenting in part).
Although I concur with the majority's conclusion that the criminal fine asserted by Dr. Bronner cannot be enforced in this civil action, I must respectfully dissent from the majority's holding that Gerald Knutson and Terry Smith do not have taxpayer standing under Alabama law to challenge the expenditure for political purposes of the funds of the Retirement Systems of Alabama ("RSA").
Until today, this Court has embraced a broad concept of taxpayer standing. Under Goode v. Tyler, 237 Ala. 106, 109, 186 So. 129, 131 (1939), Alabama taxpayers had broad standing to challenge the expenditure of state funds if they had, in a small part, been the source of those funds. Alabama's taxpayer-standing doctrine did not require that the plaintiff show a personal injury distinct from that of other taxpayers. Zeigler v. Baker, 344 So. 2d 761, 763 (Ala.1977). In Zeigler, 344 So. 2d at 763-64, this Court stated:
"In a long line of decisions this Court has recognized the right of a taxpayer to challenge, either as unconstitutional or as not conforming to statute, the expenditure of public funds by county officers.... The right of a taxpayer to challenge the unlawful disbursement of state funds likewise is unquestioned. Goode v. Tyler, 237 Ala. 106[, 109], 186 So. 129[, 131] (1939) (`... this Court is committed to the doctrine that a taxpayer may maintain a suit in equity to restrain a state officer in the unlawful disbursement of state funds').... The Supreme Court of Illinois wrote to this principle in Fergus v. Russel, 270 Ill. 304, 110 N.E. 130 (1915):
(Emphasis in original.) The majority today substantially narrows this rule of taxpayer standing.
As the majority points out, Amendment No. 472 to the Constitution of Alabama of 1901 provides:
(Emphasis added.) Tax revenues, in the form of state government contributions,[8] are *684 paid into the RSA for the "exclusive purpose" of funding RSA member benefits and paying administrative expenses. Still, the majority holds that there is no taxpayer standing.
The majority attempts to distinguish Goode, stating that the fund there was controlled by a statute, not by a constitutional amendment. 721 So. 2d at 678. Yet, it is not the status of the legal provision governing the fund, but the function of that provision, that is at issue in this case. We do not face a question of whether Amendment No. 472 is of greater constitutional moment than the statute in Goode. Instead, we face a question of whether the function of Amendment No. 472 to confine expenditures from a fund to certain exclusive purposes is different from the function of the statute in Goode.
In Goode, 237 Ala. at 109, 186 So. at 131, as in this case, tax revenues were paid into a fund the expenditures from which were exclusively dedicated to certain purposes. The Agricultural Code mandated that the fund be "expended exclusively for the expenses of the regulatory control and administrative work of the Agricultural Section of the Department of Agriculture and Industries as that work is defined in said declaration of said field of work." Ala. Agr.Code 1927, § 487, as amended by Act No. 13, Ala. Acts 1935, p. 24 (emphasis added). In Goode, 237 Ala. at 108, 186 So. at 130, as in this case, the official entity responsible for expenditures from the fund adopted a resolution approving the expenditures challenged by the taxpayer. Thus, in Goode, as in this case, tax revenues, once paid into the fund, were legally dedicated to and officially approved for a specific use.
In Goode, id. at 109, 186 So. at 131, unlike this case, however, this Court held that, because the plaintiff taxpayer had been, in part, the source of the revenues paid into the fund, he had taxpayer standing to bring an action challenging certain expenditures from the fund.[9] The holding in Goode would have been no different had it been a constitutional amendment, instead of a statute, that governed the fund and provided the "exclusive purpose" for which expenditures could be made. It was the source of the fund tax revenues that was controlling. Id. at 109, 186 So. at 131. Today, the majority effectively abandons the holding of Goode and narrows Alabama's doctrine of taxpayer standing.
As a matter of policy, I am not unsympathetic to the change in the doctrine of taxpayer standing effected by the majority. A broad doctrine of taxpayer standing empowers the Judiciary to oversee constitutional compliance by the other branches of government. See, e.g., Flast v. Cohen, 392 U.S. 83, 88 S. Ct. 1942, 20 L. Ed. 2d 947 (1968) (holding that taxpayers had standing to challenge the Government's subsidy to parochial schools on Establishment Clause grounds). A narrow doctrine of taxpayer standing, however, inhibits judicial encroachment on the provinces of the other branches of government by confining the Judiciary's role to that of deciding cases and controversies involving particularized and concrete injuries.[10] See, e.g., United *685 States v. Richardson, 418 U.S. 166, 94 S. Ct. 2940, 41 L. Ed. 2d 678 (1974) (holding that a taxpayer lacked standing to challenge, under the Statement and Account Clause of Article I, § 9, the secrecy of the Central Intelligence Agency's budget); Schlesinger v. Reservists Committee to Stop the War, 418 U.S. 208, 94 S. Ct. 2925, 41 L. Ed. 2d 706 (1974) (holding that taxpayers lacked standing to challenge, under the Incompatibility Clause of Article I, § 6, the practice of members of Congress serving in the military reserves).[11] Although I am receptive to aspects of a narrow taxpayer-standing doctrine, my concern for the judicial doctrine of stare decisis prevents me from concurring with the majority's change in Alabama law in the case before us.
[1] That section provides, in relevant part:
"(b) No person shall attempt to use his or her official authority or position for the purpose of influencing the vote or political action of any person. Any person who violates this subsection (b) shall be guilty of a felony and punishable by a fine not to exceed ten thousand dollars ($10,000) or imprisonment in the state penitentiary for a period not to exceed two years, or both.
"(c) No person in the employment of the State of Alabama, a county, or a city whether classified or unclassified, shall use any state, county, or city funds, property or time, for any political activities. Any person who is in the employment of the State of Alabama, a county, or a city shall be on approved leave to engage in political action or the person shall be on personal time before or after work and on holidays. It shall be unlawful for any officer or employee to solicit any type of political campaign contributions from other employees who work for the officer or employee in a subordinate capacity. It shall also be unlawful for any officer or employee to coerce or attempt to coerce any subordinate employee to work in any capacity in any political campaign or cause. Any person who violates this section shall be guilty of the crime of trading in public office and upon conviction thereof, shall be fined or sentenced, or both, as provided by Section 13A-10-63."
[2] On June 30, 1994, the Taxpayers Defense Force filed with the secretary of state a statement of dissolution of the political committee and a summary of contributions and expenses.
[3] We note that the federal courts narrowly construe taxpayer standing to require a distinct injury to the plaintiff, see, e.g., Schlesinger v. Reservists Committee to Stop the War, 418 U.S. 208, 220, 94 S. Ct. 2925, 41 L. Ed. 2d 706 (1974), but this Court, as the plaintiffs claim here, has recognized a broader concept of taxpayer standing. In Zeigler, this Court wrote:
"In a long line of decisions this Court has recognized the right of a taxpayer to challenge, either as unconstitutional or as not conforming to statute, the expenditure of public funds by county officers.... The right of a taxpayer to challenge the unlawful disbursement of state funds likewise is unquestioned. Goode v. Tyler, 237 Ala. 106[, 109], 186 So. 129[, 131] (1939) (`... this Court is committed to the doctrine that a taxpayer may maintain a suit in equity to restrain a state officer in the unlawful disbursement of state funds')...."
344 So. 2d at 763-64 (emphasis original).
[4] Section 36-27-2, Ala.Code 1975, provides:
"(a) A retirement system is hereby established as a body corporate and placed under the management of the board of control for the purpose of providing retirement allowances and other benefits under the provisions of this article for employees of the state of Alabama. The retirement system so created shall be established as of October 1, 1945. It shall have the power and privileges of a corporation and shall be known as the `employees' retirement system of Alabama,' and by such name all of its business shall be transacted, all of its funds invested and all of its cash and securities and other property held in trust for the purpose for which received.
"(b) Any provision of law to the contrary notwithstanding, the boards of control of the teachers' retirement system of Alabama and the employees' retirement system of Alabama shall have vested in them all powers necessary to fulfill their fiduciary duty as trustees to members of each respective system including the power to sue and be sued, complain and defend in their own names; provided, however, that as instrumentalities of the state funded by the state, the retirement systems, their officers, and employees shall be immune from suit to the same extent as the state, its agencies, officers, and employees."
See also, e.g., § 16-25-2, Ala.Code 1975.
[5] By stating our conclusion that current law does not allow the taxpayer plaintiffs to challenge Bronner's expenditures, we express no opinion on the extent to which the conduct of the RSA's chief executive officer could or should be restricted, either by the boards of control or by more specific acts of the legislature, on matters deemed to be political matters rather than matters relating to the administration of the retirement systems.
[6] There might be cases in which a taxpayer's standing is recognized because no one else may bring the action. See Zeigler v. Baker, 344 So. 2d 761 (Ala.1977), where this Court, as part of its rationale for finding taxpayer standing, acknowledged the "significance" of the following statement:
"`If a taxpayer does not launch an assault, it is not likely that there will be an attack from any other source, because the agency involved is usually in accord with the expenditure.'"
344 So. 2d at 764, quoting Department of Administration v. Horne, 269 So. 2d 659 (Fla.1972). Those facts are not present here, because any member of the RSA, and the RSA has many members, could have sued and alleged a violation of the provisions of Amendment 472 and the statutes governing the RSA.
[7] Of course, Bronner and the boards of control are subject to being sued by an RSA participant or beneficiary for misappropriating or mismanaging the funds.
[8] Tax revenues provide a substantial and continuing source of funds for the RSA through employer (i.e., state) contributions. See Ala. Code 1975, § 16-25-21 (requiring employer contributions, which are tax revenues, to be paid to the RSA for teachers' retirement funds); § 36-27-24 (requiring employer contributions, which are tax revenues, to be paid to the RSA for state employees' retirement funds).
[9] Counsel for Dr. Bronner cites McBurney v. Ruth, 527 So. 2d 1265 (Ala.1988), for the proposition that like a public corporation, the RSA is separate and independent from the State and that its funds are not state funds. This argument misconstrues the long-established general rule set out in Edmonson v. State Industrial Development Authority, 279 Ala. 206, 184 So. 2d 115 (1966). Edmonson, id. at 210, 184 So. 2d at 119, provides that an obligation is not made a state debt because of the fact that it is payable by a public corporation established by the State. Instead, an obligation is a state debt if the source of the funds to pay the obligation is a state tax previously payable into the state's general fund. Id. at 211, 184 So. 2d at 120. Accord Opinion of the Justices No. 346, 665 So. 2d 1357, 1364-65 (Ala.1995) (Kennedy, J., concurring specially) (stating that "funding is the issue here" and concluding that under Edmonson payments from a special fund created a state debt because the payments had "heretofore been paid into the general fund of the state").
[10] Professor Chemerinsky has described the implications of a broad and a narrow doctrine of taxpayer standing with respect to the federal Judiciary as follows:
(Footnote cont'd.)
"Ultimately, what is at stake is two competing visions of the role of the federal judiciary. Under one, the role of federal courts is limited to remedying specific injuries suffered by individuals. This position sees a need for great deference to the political branches of government and fears the powers of the court as an antimajoritarian institution.
"An alternative view sees the federal judiciary as existing to ensure government compliance with the Constitution. Under this position, judicial deference does not include tolerating constitutional violations."
Erwin Chemerinsky, Federal Jurisdiction 84 (1989).
[11] The Supreme Court of the United States has generally embraced a narrow doctrine of taxpayer standing that leaves numerous decisions to the political processes of the executive and legislative branches of government. See Richardson, 418 U.S. at 179, 94 S. Ct. 2940 ("In a very real sense, the absence of any particular individual or class to litigate these claims gives support to the argument that the subject matter is committed to the surveillance of Congress, and ultimately to the political process."); Schlesinger, 418 U.S. at 227, 94 S. Ct. 2925 ("Our system of government leaves many crucial decisions to the political processes[, and t]he assumption that if [the taxpayers] have no standing to sue, no one would have standing, is not a reason to find standing."). | ffaab6db43eb93bbf5058085ebe59ba959cc86918cb7b2d47f50c73b5052a635 | 1998-07-24 00:00:00 |
1e73382b-605a-446f-be42-acd4e3ded024 | Ex Parte Atmore Community Hosp. | 719 So. 2d 1190 | 1961796 | Alabama | Alabama Supreme Court | 719 So. 2d 1190 (1998)
Ex parte ATMORE COMMUNITY HOSPITAL.
(Re Diane TURNER v. Michael HAYES et al.)
1961796.
Supreme Court of Alabama.
June 19, 1998.
*1192 R. Alan Alexander and Joseph D. Steadman of Helmsing, Lyons, Sims & Leach, P.C., Mobile, for petitioner.
Robert S. Presto of Caffey, Presto & Associates, P.C., Brewton, for respondent Diane Turner.
SEE, Justice.
Diane Turner sued her co-employee Michael Hayes; Hayes's supervisor, Levon Henley; and her employer, Atmore Community Hospital ("Atmore Hospital"), alleging, among other things, battery and invasion of privacy. The claims arose from Hayes's alleged sexually harassing conduct toward her. The trial court issued an order that, among other things, granted a summary judgment for Atmore Hospital. The Court of Civil Appeals reversed that summary judgment, holding that Atmore Hospital could be liable for Hayes's conduct toward Turner. See Turner v. Hayes, 719 So. 2d 1184 (Ala.Civ. App.1997). We granted Atmore Hospital's petition for certiorari review to consider one question: Whether Atmore Hospital could be held liable for Hayes's alleged battery and invasion of privacy. Because we hold that Turner failed to present substantial evidence that would support a holding making Atmore Hospital liable for Hayes's conduct, we reverse that portion of the judgment of the Court of Civil Appeals that concerns Atmore Hospital's liability.
Viewed in the light most favorable to Turner, the nonmovant, the evidence before the trial court at the summary judgment stage indicated that Turner worked for Atmore Hospital from October 1992 to May 1994, and that Hayes was her supervisor. Turner alleges that Hayes sexually harassed her and that she reported Hayes's conduct to Henley, Atmore Hospital's administrator. After Henley spoke with Hayes, the alleged sexual harassment stopped. However, Turner alleges that Hayes retaliated against her by withholding her time card and computer password. Henley ordered Hayes to give Turner the time card and password, and he did. Hayes did not withhold the time card or password again. Turner also alleges that Hayes subsequently threw a box of computer labels at her and that it landed beside her feet. Henley was not present when this incident occurred. Turner quit her job that day because, she alleges, Atmore Hospital failed to adequately deal with Hayes's tortious conduct.
Turner sued Hayes, Henley, and Atmore Hospital, alleging outrage, battery, and invasion of privacy. The trial court entered a summary judgment in favor of Hayes on Turner's outrage claim, but not on her battery and invasion of privacy claims. The trial court also entered a summary judgment in favor of Henley and Atmore Hospital on all the claims, holding that neither Henley nor Atmore Hospital was liable for Hayes's conduct. The Court of Civil Appeals affirmed *1193 the summary judgment in favor of Hayes, and thus in favor of Henley and Atmore Hospital, on the outrage claim, and affirmed the summary judgment in favor of Henley on all claims. The Court of Civil Appeals also affirmed the trial court's order striking certain evidence submitted by Turner in opposition to the defendants' summary judgment motion. However, the Court of Civil Appeals reversed the summary judgment in favor of Atmore Hospital on the battery and invasion-of-privacy claims, holding that as to those claims there was a genuine issue of material fact as to whether Atmore Hospital was liable for Hayes's conduct. We address only this last holding.
A summary judgment is proper where there is no genuine issue of material fact as to the claims asserted and the movant is entitled to a judgment as a matter of law. Rule 56, Ala. R. Civ. P.; Booker v. United American Ins. Co., 700 So. 2d 1333, 1334 (Ala. 1997). Initially, the movant has the burden to make a prima facie showing that there is no genuine issue of material fact. Booker, 700 So. 2d at 1334. Such a showing shifts the burden to the nonmovant to present substantial evidence as to each element of the claim challenged by the movant. Id.; Kidd v. Kilpatrick Chevrolet, Inc., 613 So. 2d 336, 338 (Ala.1993).
Atmore Hospital met its burden by making a prima facie showing that it was not responsible for Hayes's alleged battery of Turner and his alleged invasion of her privacy. It showed that Henley, the hospital administrator, met with Hayes and instructed him not to touch Turner in an offensive manner or to intrude into her privacy. Further, Atmore Hospital presented evidence indicating that Henley subsequently instructed Hayes to return Turner's computer password and time card.[1] This prima facie showing shifted the burden to Turner to present substantial evidence of each challenged element of her battery and invasion of privacy claims and substantial evidence of facts that would make Atmore Hospital liable for Hayes's alleged tortious conduct.
To succeed on a claim alleging battery, a plaintiff must establish: (1) that the defendant touched the plaintiff; (2) that the defendant intended to touch the plaintiff; and (3) that the touching was conducted in a harmful or offensive manner. Surrency v. Harbison, 489 So. 2d 1097, 1104 (Ala.1986); Restatement (Second) of Torts § 18 (1965).
*1194 Turner presented evidence indicating that Hayes touched her waist, rubbed against her when passing her in the hall, poked her in the armpits near the breast area, and touched her leg. Turner also presented evidence indicating that each of these touchings was intentional, was conducted with sexual overtones, and was unwelcome. These factual assertions constituted substantial evidence that Hayes committed a battery. Surrency, 489 So. 2d at 1104.
To succeed on a claim alleging invasion of privacy relating to sexual harassment, a plaintiff must show: (1) that the matters intruded into are of a private nature; and (2) that the intrusion would be so offensive or objectionable that a reasonable person subjected to it would experience outrage, mental suffering, shame, or humiliation. Busby v. Truswal Systems Corp., 551 So. 2d 322, 323 (Ala.1989). While asking a co-employee for a date and making sexual propositions usually do not constitute an invasion of privacy, see McIsaac v. WZEW-FM Corp., 495 So. 2d 649, 651 (Ala.1986), extensive inquiries into one's sex life or looking up one's skirt may constitute an invasion of privacy, see Phillips v. Smalley Maintenance Services, 435 So. 2d 705, 709 (Ala.1983); Restatement (Second) of Torts § 652B cmt. c, ex. 7.
Turner presented evidence indicating that Hayes made several lewd comments and asked Turner to meet him outside of work hours for other than business purposes. Further, Turner presented evidence indicating that Hayes looked up her skirt on more than one occasion. These factual assertions constituted substantial evidence that Hayes committed an invasion of privacy. Phillips, 435 So. 2d at 709.
An employer is liable for the intentional torts of its employee if: (1) the employee's acts are committed in furtherance of the business of the employer; (2) the employee's acts are within the line and scope of his employment; or (3) the employer participated in, authorized, or ratified the tortious acts. Potts v. BE&K Constr. Co., 604 So. 2d 398, 400 (Ala.1992). This Court has stated that tortious acts furthered an employer's business where, for example, a defendant undertaker refused to release the body of the plaintiff's husband until the plaintiff had paid for services rendered, Levite Undertakers Co. v. Griggs, 495 So. 2d 63 (Ala. 1986), and where the defendant used threatening or abusive behavior in an attempt to coerce the plaintiff into dropping his claim, National Security Fire & Casualty Co. v. Bowen, 447 So. 2d 133 (Ala.1983). In contrast, where a co-employee defendant's behavior is aimed at "satisfying [the co-employee's] own lustful desires," this Court has held that "no corporate purpose could conceivably be served." Busby, 551 So. 2d at 327. Turner's evidence of Hayes's alleged battery and invasion of privacy indicates that Hayes's alleged conduct was aimed solely at satisfying his own lustful desires. Thus, Turner failed to present substantial evidence on which Atmore Hospital could be liable for a battery or invasion of privacy by Hayes on the grounds that his conduct furthered the hospital's business.
An employee's tortious acts occur within the scope of his employment if the acts are "so closely connected with what the servant is employed to do and so fairly and reasonably incidental to it, that they may be regarded as methods, even though quite improper ones, of carrying out the objectives of the employment." Prosser & Keeton, The Law of Torts 503 (5th ed.1984). In Big B, Inc. v. Cottingham, 634 So. 2d 999, 1002 (Ala. 1993), this Court held that there was sufficient evidence that a store manager who falsely imprisoned a customer suspected of shoplifting was acting within the scope of his employment because preventing shoplifting was closely related to his employment as a store manager. In contrast, where the store manager forced the customer to perform a sexual act with him, this Court has held that the manager was acting outside the scope of his employment. Id. at 1002; see also Hendley v. Springhill Mem'l Hosp., 575 So. 2d 547 (Ala.1990) (holding that a hospital is not liable for the unauthorized sexual touching by an agent). Turner's evidence of Hayes's alleged battery and invasion of privacy shows that his conduct was entirely personal in nature and not within his assigned duties. *1195 Thus, Turner failed to present substantial evidence on which Atmore Hospital could be liable for these claims on the grounds that Hayes's conduct was within the line and scope of his duties.
An employer is also liable for the intentional torts of the employee if the employer ratifies the employee's conduct. Potts, 604 So. 2d at 400. An employer ratifies conduct if: (1) the employer has actual knowledge of the tortious conduct; (2) based on this knowledge, the employer knew the conduct constituted a tort; and (3) the employer failed to take adequate steps to remedy the situation. Id. "Adequate" means that the employer took reasonable and necessary steps to stop the tortious conduct. Id. at 401. In Mardis v. Robbins Tire & Rubber Co., 669 So. 2d 885, 889 (Ala.1995), this Court held that a plaintiff presented substantial evidence of inadequate corrective action by an employer by showing that the employer failed to investigate or reprimand the coemployee accused of assault and battery. In contrast, where the specific tortious conduct stops after corrective action by the employer, this Court has held that the corrective action is adequate as a matter of law. Potts, 604 So. 2d at 401. Turner's evidence of Hayes's alleged battery and invasion of privacy shows that this conduct stopped after Turner reported the conduct to Henley and Henley ordered Hayes to cease such conduct.
Nevertheless, Turner contends that after Henley reprimanded Hayes, Hayes took two subsequent actions toward her: (1) he withheld her computer password and her time card; and (2) he threw a box of computer labels toward her that landed near her feet. Even though Henley ordered Hayes to give Turner the password and time card, and even though Hayes did so, Turner argues that Atmore Hospital's corrective actions were inadequate to stop Hayes from subsequently throwing the box of labels in her direction. While such assertions might challenge the adequacy of the hospital's corrective action with respect to some torts, they do not challenge its adequacy with respect to the torts set forth in Turner's complaint battery and invasion of privacy. See Martin v. Fidelity & Cas. Co. of New York, 421 So. 2d 109, 111 (Ala.1982) ("[I]t is for the plaintiff and not the court to articulate the claims forming a basis for relief."). Hayes's alleged withholding of Turner's password and time card and his alleged throwing of a box of labels toward Turner without the box hitting her did not include an offensive touching, and thus, did not constitute battery. See Surrency, 489 So. 2d at 1104; Restatement (Second) of Torts § 18 (1965). Further, because these alleged subsequent actions did not involve extensive inquiries into Turner's sex life, looking up her skirt, or other egregious intrusions into private matters, they did not constitute invasion of privacy. See Phillips, 435 So. 2d at 709; Restatement (Second) of Torts § 652B cmt. c, ex. 7. Because these actions would not support a finding of the specific torts pleaded against Hayes, they also provide no basis for holding Atmore Hospital liable for Hayes's alleged battery and invasion of privacy.
Therefore, we reverse that portion of the judgment of the Court of Civil Appeals holding that the summary judgment in favor of Atmore Hospital as to the battery and invasion of privacy claims was improper, and we remand.
REVERSED AS TO THE BATTERY AND INVASION-OF-PRIVACY CLAIMS AGAINST THE DEFENDANT ATMORE HOSPITAL; AND REMANDED.
HOOPER, C.J., and MADDOX, ALMON, HOUSTON, COOK, and LYONS, JJ., concur.
[1] Turner contends that Atmore Hospital is procedurally barred from denying that Hayes was its agent when he allegedly committed the tortious acts. Specifically, Turner contends that the lack of agency is an affirmative defense that must be pleaded in the defendant's answer, or else it is waived. Atmore Hospital's answer provided a general denial of agency, not a specific affirmative denial. Rule 8(c), Ala. R. Civ. P., provides in pertinent part:
"In pleading to a preceding pleading, a party shall set forth affirmatively accord and satisfaction, arbitration and award, assumption of risk, contributory negligence, discharge in bankruptcy, duress, estoppel, failure of consideration, fraud, illegality, injury by fellow servant, laches, license, payment, release, res judicata, statute of frauds, statute of limitations, waiver, and any other matter constituting an avoidance or affirmative defense."
(Emphasis added.) "An affirmative defense is defined as `new matter which, assuming the complaint to be true, constitutes a defense to it.'" Bechtel v. Crown Cent. Petroleum Corp., 451 So. 2d 793, 795 (Ala. 1984) (emphasis added) (citation omitted). Accord 2A J. Moore, Moore's Federal Practice § 8.27 (2d ed.1982) (stating that an affirmative defense concerns matters outside the claimant's prima facie case). The averment in Turner's complaint that Hayes was the agent of Atmore Hospital when he allegedly committed the tortious acts cannot be assumed true if Atmore's defense is that Hayes was not its agent when he allegedly committed the tortious acts. Therefore, Atmore Hospital's denial of an agency relation with Hayes is not an affirmative defense because it is not external to the plaintiff's claims against Atmore. Instead, agency is an essential internal element of Turner's claims. See Porto v. Peden, 233 F. Supp. 178, 180 (W.D.Pa.1964) (stating that the denial of agency is a negative defense, not an affirmative defense); Sterrett v. Milk River Production Credit Ass'n, 234 Mont. 459, 463-64, 764 P.2d 467, 469-70 (1988) (stating that the denial of agency is not an affirmative defense). Thus, Atmore Hospital's general denial of agency was sufficient to preserve its opportunity to contest Hayes's agency at the summary judgment stage and on appeal. | f27eea14ec0563b9dc3940ce173446dbe69b43a6e542993953a50713567d12d3 | 1998-06-19 00:00:00 |
f17941f1-2479-4a62-8d9a-cb9307c229c0 | Merrill Lynch, Pierce, Fenner & Smith, Inc. v. Cobb | 717 So. 2d 355 | 1961773 | Alabama | Alabama Supreme Court | 717 So. 2d 355 (1998)
MERRILL LYNCH, PIERCE, FENNER & SMITH, INC.; and Ann Holman
v.
Jerry COBB and Retha Cobb.
1961773.
Supreme Court of Alabama.
June 19, 1998.
A. Inge Selden III, Carl S. Burkhalter, and T. Louis Coppedge of Maynard, Cooper & Gale, P.C., Birmingham, for appellants.
Thomas T. Gallion III of Haskell, Slaughter & Gallion, Montgomery; and Ray Vaughan, Montgomery, for appellees.
KENNEDY, Justice.
The defendants, Merrill Lynch, Pierce, Fenner & Smith, Inc., and Ann Holman, appeal from the trial court's denial of their motion to compel arbitration. The notice of *356 appeal was not timely filed, and the appeal is dismissed ex mero motu.
The trial court denied the defendants' motion to compel arbitration on December 10, 1996. The denial of a motion to compel arbitration is an appealable order, and the defendants had 42 days in which to appeal. A.G. Edwards and Sons v. Clark, 558 So. 2d 358 (Ala.1990). However, on December 27, 1996, the defendants filed a motion to alter, amend, or vacate the order, pursuant to Rule 59(e), Ala.R.Civ.P., and the running of the 42-day appeal period was suspended pending the trial court's ruling on that motion. Rule 4(a)(3), Ala.R.App.P.; Alabama Farm Bureau Mut. Cas. Insurance Co. v. Boswell, 430 So. 2d 426, 428 (Ala.1983).
On March 5, 1997, the trial court denied the defendants' Rule 59(e) motion. Therefore, the 42-day period for appeal began to run again on that date. That 42-day period ended on April 16, 1997. The defendants, however, did not file a notice of appeal within that period; they took no action until May 22, 1997, when they filed a letter with the trial court. In that letter, the defendants' attorney indicated that he had received a copy of the case action summary sheet for the case and had noticed that the defendants' Rule 59(e) motion had been denied.
On June 10, 1997, the trial court entered an order purporting to set aside its March 5 order denying the defendants' Rule 59(e) motion as having been "inadvertently granted." The next day, June 11, 1997, the trial court entered another order, purporting to deny the defendants' Rule 59(e) motion to alter, amend, or vacate. On June 21, 1997, the defendants filed a notice of appeal to this Court, appealing the trial court's denial of their motion to compel arbitration.
It appears that the defendants rely on the trial court's June 11, 1997, order to mark the beginning of the 42-day period allowed for appeal. In the "statement of the case" contained in their brief, the defendants cite only the trial court's second denial of their Rule 59(e) motion, and they assert that the notice of appeal was timely filed. However, it is the trial court's March 5, 1997, denial of the defendants' Rule 59(e) motion that marks the beginning of the 42-day appeal period; the defendants filed their notice of appeal approximately 108 days later, or 66 days after the appeal period had run.
Although the trial court attempted to set aside its original order denying the motion, that attempt had no legal effect. The original order of March 5, 1997, was entered by a signed notation on the case action summary sheet, and there is no evidence that it was entered by a clerical error or by an oversight. See Rule 60(a), Ala. R.Civ.P.; see generally Wilson v. Leck's 66 Service Station, 513 So. 2d 620, 621 (Ala.Civ. App.1987); (noting that the rule authorizing the correction of clerical errors "does not authorize the trial court to render a different judgment"); Cornelius v. Green, 521 So. 2d 942, 945 (Ala.1988). By describing the original order as "inadvertently granted," the trial court may have been attempting to cite Rule 60(b) to withdraw its original order. However, the defendants had made no Rule 60(b) motion, and there is no evidence that any of the circumstances required for granting such a motion ever existed. See Rule 60(b), Ala.R.Civ.P. More unusual is the fact that the trial court simply entered a duplicate of its March 5, 1997, order denying the defendants' Rule 59(e) motion. It would be improper for a court to circumvent the Rules of Procedure in an attempt to artificially renew the period in which a party may appeal. "Neither Rule 60(a) nor Rule 60(b) may be used as a substitute for a timely appeal." R.J. Reynolds Tobacco Co. v. Cantley, 717 So. 2d 751 (Ala.1998). The Rules of Civil Procedure already consider instances of excusable neglect, and they specifically allow a 30-day extension for appeal in a case where the clerk fails to notify a party of a judgment or an order that has been entered in a case. See Rule 60(b), Ala.R.Civ.P; Rule 77(d), Ala.R.Civ.P.
In this case, a notation on the case action summary sheet indicates that the defendants were notified on March 6, 1997, of the trial court's March 5, 1997, denial of their Rule 59(e) motion. It was the defendants' duty to stay abreast of any action taken in this case, and they had 42 days in which to appeal to *357 this Court. They did not appeal within that period. This appeal is, therefore, dismissed.
DISMISSED.
MADDOX, ALMON, SHORES, COOK, and LYONS, JJ., concur. | 05dc0aa5d42af01e1275c7ee7729ce32522adb846e60cfa931b46ed61cd7ef4c | 1998-06-19 00:00:00 |
5e84f443-6c70-42e8-8a70-a61e8cd9bf49 | Thermal Components, Inc. v. Golden | 716 So. 2d 1166 | 1961446 | Alabama | Alabama Supreme Court | 716 So. 2d 1166 (1998)
THERMAL COMPONENTS, INC., a DIVISION OF INSILCO CORPORATION; et al.
v.
Gusta GOLDEN.
1961446.
Supreme Court of Alabama.
June 19, 1998.
*1167 J. Lister Hubbard, Christopher W. Weller, and Raymond L. Jackson of Capell, Howard Knabe & Cobbs, P.A., Montgomery, for appellants.
Edward B. Parker II of Parker & Mooty, P.C., Montgomery, for appellee.
SEE, Justice.
This lawsuit arises out of injuries Gusta Golden claims to have suffered as a result of overexposure to lead particles while working within the line and scope of his employment for Thermal Components, Inc., a division of Insilco Corporation ("Thermal Components"). Golden filed a multi-count complaint asserting, among other things, that two of his co-employees, Wayne Raymar and Frank Johnson, caused his injuries by negligent or wanton conduct. Golden also asserted that Thermal Components, or Insilco Corporation, had designed a defective brass mill and was thus liable for his injuries under the Alabama Extended Manufacturer's Liability Doctrine ("AEMLD"). Raymar, Johnson, and Thermal Components moved the trial court to dismiss Golden's claims, pursuant to Rule 12(b)(6), Ala. R. Civ. P., arguing that Golden's claims were barred by the exclusive remedy provision of Alabama's Workers' Compensation Act. Ala.Code 1975, § 25-5-53. The trial court denied the defendant's motion to dismiss Golden's claims, and we granted permission to appeal from that order, pursuant to Rule 5, Ala. R.App. P.[1] Because we conclude that Golden's AEMLD claim could possibly have merit, but that his remaining claims are precluded by the exclusive remedy provisions of the Workers' Compensation Act, we affirm in part, reverse in part, and remand.
This Court must review motions to dismiss in the light most favorable to the plaintiff, resolving all reasonable doubts in his favor. Blackwood v. Davis, 613 So. 2d 886, 887 (Ala.1993). Dismissal is appropriate only in those cases where the plaintiff's claims, if proven, would not entitle him to relief. Id.
The complaint in this case, when viewed in the light most favorable to the plaintiff, Golden, suggests the following: Golden was employed by Thermal Components in January 1996 to work in its brass mill section. In that mill he was frequently exposed to lead particles. Although Golden was provided with protective clothing to prevent overexposure to lead particles, he alleges that he was instructed by his supervisors, the defendants Raymar and Johnson, to wear the protective clothing only inside the "molten pot," a closed area inside the brass mill section of the plant. Golden alleges that the brass mill, or its component parts, were defectively designed *1168 or manufactured. In particular, Golden alleges that Thermal Components, or Insilco, failed to provide for proper ventilation or to install a safety device that would have prevented or controlled the release of lead contaminants.
Specifically, Golden's multi-count complaint alleges, among other things, that all of the defendants either "negligently or wantonly" failed: (1) to provide him with a safe place to work; (2) to provide him with proper training in the safety measures appropriate for avoiding exposure to lead; (3) to inspect the brass mill for lead contaminants; and (4) to provide him with adequate safeguards or safety devices.
On appeal, Raymar and Johnson argue that Golden's exclusive remedy for his alleged on-the-job injuries is provided by the Workers' Compensation Act. Specifically, Raymar and Johnson assert that to bring such an action as this against them as co-employees, Golden must assert that they "willfully" injured him. Golden responds by arguing that Raymar and Johnson did "willfully" injure him, within the meaning of Ala. Code 1975, § 25-5-11(c)(2) (co-employee's removal of a safety device from a machine) by instructing him to wear protective clothing only in part of the brass mill section and by failing to install a safety device in the brass mill that would have protected him from overexposure to lead particles. Thus, Golden asserts that he is not limited to the remedies provided by the Workers' Compensation Act.
Alabama's Workers' Compensation Act provides, in pertinent part, the following general rule of exclusivity of remedy:
Ala.Code 1975, § 25-5-53 (emphasis added). See § 25-5-52. Section 25-5-11(b) limits the scope of the exclusivity rule by providing, in pertinent part, that "[i]f personal injury ... to any employee results from the willful conduct, as defined in subsection (c) herein, of any ... employee of the same employer ..., the employee shall have a cause of action against the person." Section 25-5-11(c) defines "willful conduct" to include:
(Emphasis added.)
We have consistently held that evidence of negligent or wanton conduct is insufficient to establish the "willful conduct" required by § 25-5-11(c).[2] See Davis, 613 So. 2d at 887 (affirming a dismissal of the plaintiff's action because "[a]lthough the allegations [in the complaint] indicate[d] that the co-employees may have been negligent ... there were no allegations that the co-employees' alleged failure ... constituted `willful conduct' under § 25-5-11(c)(1)"); Barron v. CNA Ins. Co., 678 So. 2d 735, 737 (Ala.1996) (affirming a summary judgment in favor of the defendants because, although the plaintiffs alleged that the defendants negligently or wantonly failed to provide them a safe place to work, "[t]he plaintiffs did not allege willful conduct on the part of [the] defendants"); see also Ala.Code 1975, § 25-5-14 ("The legislature finds that actions filed on behalf of injured employees against ... employees of the same employer seeking to recover damages *1169 in excess of amounts received ... from the employer under the workers' compensation statutes ... and predicated upon claimed negligent or wanton conduct resulting in injuries... are contrary to the intent of the legislature...."). Thus, Golden's general assertions that Raymar and Johnson "negligently or wantonly" failed to adequately inspect the brass mill, failed to appropriately train Golden, or failed to adequately provide Golden with a safe place to work do not support an action under § 25-5-11(c)(1) for a recovery in excess of that provided by the Workers' Compensation Act.
Moreover, even when the factual allegations of the complaint are read most favorably to Golden, they do not support the assertion that Raymar or Johnson ever removed a safety device from a machine, within the meaning of § 25-5-11(c)(2). Golden's assertion that Raymar and Johnson instructed him to wear protective clothing only in the "molten pot" section of the brass mill, or failed to provide him with protective clothing, does not constitute the "removal from a machine of a safety guard or safety device." In Mallisham v. Kiker, 630 So. 2d 420 (Ala. 1993), we held that the failure to install timbers in a mine did not constitute removal of a safety device from a machine, because the mine was not a machine. Similarly, Golden's body, on which the protective clothing would have been worn, was not a machine.
Similarly, Golden's assertion that Raymar and Johnson failed to install an appropriate safety device or that they failed to install a better ventilation system does not support a claim alleging "removal from a machine of a safety device." We rejected this argument in Burkett v. Loma Machine Manufacturing, Inc., 552 So. 2d 134, 138 (Ala. 1989), where we held that § 25-5-11(c)(2) imposes no duty to add safety guards that the manufacturer does not provide with the product. Accord Davis, 613 So. 2d at 888 (holding that co-employees' failure to install adequate lighting not provided with a product did "not constitute the removal of, or failure to install, a safety device or safety guard provided by manufacturers of machines, within the meaning of § 25-5-11(c)(2)"). In this case, there was no safety device provided for the brass mill by the manufacturer that Raymar and Johnson failed to install. Therefore, the trial court erred when it denied Raymar and Johnson's motion to dismiss those counts of the complaint that deal with their failure to provide protective clothing or to install a better ventilation system.[3]
With respect to Thermal Components, Golden's employer, Golden concedes that the Workers' Compensation Act provides the exclusive remedy. Accordingly, we also reverse the trial court's order denying the motion to dismiss those counts of the complaint asserted against Thermal Components.
Golden further contends that Insilco is a corporation distinct from his corporate employer, Thermal Components. Thus, he argues, he is not prohibited by the Workers' Compensation Act from bringing his AEMLD claim against Insilco, which he alleges manufactured or designed the brass mill. It is unclear from the complaint whether Insilco is a corporate entity separate from Thermal Components. It is therefore possible that the Workers' Compensation Act does not prohibit Golden's AEMLD claim against Insilco. See Davis, 613 So. 2d at 887; Ala. Code 1975, § 25-5-1(4) (defining "employer"); § 25-5-53 (barring a tort action by an injured employee against his employer and the employer's workers' compensation carrier).
*1170-1172 Therefore, we affirm that portion of the trial court's order denying the motion to dismiss those counts asserting an AEMLD claim, to the extent that claim is asserted against Insilco, a separate corporation. We reverse that portion of the trial court's order denying the motion to dismiss the remainder of the counts, and we remand the cause for further proceedings not inconsistent with this opinion.
AFFIRMED IN PART; REVERSED IN PART; AND REMANDED.
HOOPER, C.J., and MADDOX, ALMON, SHORES, HOUSTON, COOK, and LYONS, JJ., concur.
KENNEDY, J., dissents.
[1] Although Golden's son and his son's mother also filed claims against the defendants, those claims are not currently before this Court.
[2] "Negligence" has been defined as "an inattention, thoughtlessness, or heedlessness, a lack of due care." Ex parte Anderson, 682 So. 2d 467, 470 (Ala.1996) (citations omitted). "Wantonness" and "wilfulness" have been defined as follows:
"`"Wantonness" is the conscious doing of some act or the omission of some duty under knowledge of existing conditions [while] conscious that from the doing of such act or omission of such duty injury will likely or probably result.
"`"Wilfulness" is the conscious doing of some act or omission or some duty under knowledge of existing conditions accompanied with a design or purpose to inflict injury.'" Reed v. Brunson, 527 So. 2d 102, 119 (Ala.1988) (quoting Alabama Pattern Jury Instructions: Civil 29.01 (1974)) (emphasis added) (citations omitted).
[3] We note that Golden argued to the trial court that he was entitled to elect recovery either under the Workers' Compensation Act or under general Alabama tort law. On appeal, Golden properly abandons this argument. See Barron v. CNA Ins. Co., 678 So. 2d 735, 739 (Ala.1996) (stating that the Workers' Compensation Act is the exclusive remedy for on-the-job injuries unless an exception to exclusivity is expressly provided for in the Act). | 25718701c2b1860063cef0e926cd792077e51ee82707a372ee99701bda4bc0ff | 1998-06-19 00:00:00 |
0e5872ea-17e9-4a18-963f-4a6fa765e7d9 | Ex Parte Scroggins | 727 So. 2d 131 | 1970216 | Alabama | Alabama Supreme Court | 727 So. 2d 131 (1998)
Ex parte Nathaniel SCROGGINS
(Re Nathaniel Scroggins v. State.)
1970216.
Supreme Court of Alabama.
July 10, 1998.
Rehearing Denied October 16, 1998.
Charles Amos Thompson, Birmingham, for petitioner.
Bill Pryor, atty. gen., and Beth Slate Poe, asst. atty. gen., for respondent.
SHORES, Justice.
We granted Nathaniel Scroggins's petition for certiorari review of a judgment of the Court of Criminal Appeals affirming his conviction of capital murder for the shooting of Richard Fields. See Scroggins v. State, 727 So. 2d 123 (Ala.Cr.App.1997). The basis for granting review was to determine whether the State met its burden to establish that the only eyewitness in this capital murder case was "unavailable" to testify at trial, as that term is defined in Rule 804, Ala. R. Evid.; if he was, then his testimony at the preliminary hearing was admissible at trial. We reverse and remand.
Nathaniel Scroggins was indicted for the murder of Richard Fields; he was charged on three counts of capital murder: 1) robbery/murder, in violation of § 13A-5-40(a)(2); 2) murder while the victim is in a vehicle, in violation of § 13A-5-40(a)(17); and 3) murder by and through the use of a deadly weapon fired or otherwise used within or from a vehicle, in violation of § 13A-5-40(a)(18). The indictment charged that Scroggins murdered Richard Fields while *132 Scroggins was in the course of stealing Fields's Buick automobile.
At trial, Judge James Hard allowed the State to offer the testimony an eyewitness, Billy Joe Williams, had given at the preliminary hearing; Judge Hard allowed that evidence on the grounds that at trial Williams was "unavailable," as that term is defined in Rule 804, Ala. R. Evid. The opinion of the Court of Criminal Appeals recites facts taken from Williams's testimony:
727 So. 2d at 124-125. The jury convicted Scroggins, who was 16 years old at the time of the murder. The court sentenced him to life imprisonment on count one and to life imprisonment without the possibility of parole on counts two and three. The Court of Criminal Appeals affirmed Scroggins's convictions, holding that whether a witness is "unavailable" is left to the sound discretion of the trial court, 727 So. 2d at 126, citing Johnson v. State, 623 So. 2d 444, at 448 (Ala.Crim. App.1993). The Court of Criminal Appeals concluded that "unless this witness wanted to be found, locating him would have been virtually impossible," 727 So. 2d at 128, and, therefore, that the trial court did not abuse its discretion in admitting the testimony from the preliminary hearing. The Court of Criminal Appeals did not explain in its opinion why it would have been "virtually impossible" for the state to find the only witness to this crime.
The Confrontation Clause of the Sixth Amendment to the Constitution of the United States requires that in all criminal prosecutions the accused shall have the right to be confronted with the witnesses against him. Tomlin v. State, 591 So. 2d 550, 555 (Ala.Cr. App.1991), citing Kirby v. United States, 174 U.S. 47, 55, 19 S. Ct. 574, 43 L. Ed. 890 (1899). The United States Supreme Court in Ohio v. Roberts, 448 U.S. 56, 100 S. Ct. 2531, 65 L. Ed. 2d 597 (1980), emphasized that the Confrontation Clause reflects a preference for face-to-face confrontation at trial and that a primary interest secured by the Confrontation Clause is the right of cross-examination. Grantham v. State, 580 So. 2d 53, 55 (Ala.Cr. App.1991), citing Ohio v. Roberts, 448 U.S. at 63, 100 S. Ct. 2531.
The Confrontation Clause and the hearsay exclusionary rule are generally designed to protect similar values. California v. Green, 399 U.S. 149, 155, 90 S. Ct. 1930, 26 L. Ed. 2d 489 (1970). The hearsay exclusionary rule makes hearsay evidence inadmissible unless it falls into one of the recognized exceptions. The Alabama Rules of Evidence incorporate "unavailability" as such an exception in Rule 804:
Evidence that would normally be admissible under an exception to the hearsay rule may be inadmissible because it violates the Confrontation Clause of the Sixth Amendment. Grantham v. State, 580 So. 2d 53, 55 (Ala.Cr. App.1991), citing United States v. Bernard S., 795 F.2d 749, 753 (9th Cir.1986); United States v. Oates, 560 F.2d 45, 81 (2d Cir.1977). When the prosecution seeks to introduce, against a criminal defendant, the former testimony of a now unavailable witness, its burden in seeking the witness's presence is enhanced by the defendant's Sixth Amendment right to confront witnesses. Ex parte Wright, 625 So. 2d 1135, 1136 n. 2 (Ala.1993). Thus, when at trial the State wishes to use a person's statement against a criminal defendant, in order for that statement to be admissible the State must either produce as a witness the person whose statement it wishes to use or else demonstrate that that person is "unavailable" for the trial. Inmon v. State, 585 So. 2d 261, 265 (Ala.Cr.App.1991).
Professor Charles Gamble, the preeminent authority on Alabama evidence law, has stated, "[T]he prerequisite showing of unavailability may be greater as to prosecution witnesses in a criminal case because it takes on constitutional dimensions." C. Gamble, McElroy's Alabama Evidence, § 242.01(6)(f), p. 1130 (5th ed.1996). Professor Gamble notes that "[t]he United States Supreme Court, in a long line of decisions culminating with Ohio v. Roberts, has concluded that [admitting against a criminal defendant the testimony of a witness who does not appear at trial] may violate the Sixth Amendment right of the accused `to be confronted with the witnesses against him.'" Id., § 242.01(7), p. 1132. In order for the admission of a statement of a witness who is not present at trial to satisfy the right to confrontation of witnesses, the concerns of necessity and reliability must be satisfied. "The necessity concern customarily requires that the prosecution either produce or account for the unavailability of the declarant." Id. See Thompson v. State, 106 Ala. 67, 74, 17 So. 512, 514 (1895). Ohio v. Roberts "mandates that the prosecution have made a good faith effort to obtain the presence of the declarant at trial." C. Gamble, supra, § 242.01(7), p. 1132.
The Court of Criminal Appeals relied upon Johnson v. State, supra, to affirm the trial court's holding that the witness was "unavailable." However, Johnson v. State sets a high standard for proving that the State exercised due diligence in its attempt to procure the presence of a witness:
623 So. 2d at 447. In Johnson, the hearing on the unavailability of the witness included testimony of the witness's mother, the witness's girlfriend, an investigator for the State, and a jailer for the City of Birmingham. The testimony of these persons indicated that each of them had made efforts to locate the witness but had been unable to find him. The witness sought had a murder charge pending against him, and he had recently escaped from jail. Id. at 447.
Johnson's standard of due diligence is based upon Alabama law holding that a declarant is not rendered "unavailable" by absence alone. The party seeking to introduce the declarant's statement has to show that it is unable to procure the declarant's attendance either by legal process or by other reasonable means:
Williams v. Calloway, 281 Ala. 249, 251-52, 201 So. 2d 506, 508 (Ala.1967).
While the question of the sufficiency of the proof offered to establish the predicate of a witness's unavailability is addressed to the sound discretion of the trial judge, the issue is of constitutional significance in a criminal case and especially so in a capital one. Here, the State failed to show that it used due diligence and made a good faith effort in trying to locate the witness whose testimony it sought to introduce at trial. Morgan Knight, an investigator with the Jefferson County district attorney's office, was the only witness to testify as to Williams's unavailability. Knight's testimony reflects that he conducted his search for Williams primarily by telephone. He did not know whether Williams had been served with a subpoena by the Jefferson County sheriff's office. He stated that he put a "hold" on Williams, but that although the juvenile authorities arrested him and placed him in the juvenile facility, he was released before Scroggins's trial. No writ of attachment was ever issued for Williams. We therefore conclude that the State failed to carry its burden to show that Billy Joe Williams was "unavailable," so that his testimony given at the preliminary hearing would have been admissible into evidence at Scroggins's trial.
The burden of proof in all criminal prosecutions rests upon the State, with the presumption of innocence attending the defendant until the burden of proof has been met. To allow the State to simply introduce the preliminary-hearing testimony of the only eyewitness to the killing and thus shift the burden to the defendant to disprove the facts suggested in that testimony would impose on the defendant a burden so great as to deprive him of a fair trial and due process of law. Grantham v. State, supra; U.S. Const. Amend. VI.
The judgment affirming Scroggins's convictions is reversed, and the cause is remanded for the Court of Criminal Appeals to order a new trial.
REVERSED AND REMANDED.
ALMON, KENNEDY, COOK, and LYONS, JJ., concur.
HOOPER, C.J., and MADDOX, HOUSTON, and SEE, JJ., dissent.
SEE, Justice (dissenting).
I must respectfully dissent from the majority's holding that the Sixth Amendment to the Constitution of the United States prohibits the admission of the preliminary-hearing testimony of the State's absent witness, Billy Williams. The application of clear precedent of the Supreme Court of the United States establishes that the testimony of this absent witness is admissible. The State presented sufficient evidence to show that it had made a good faith effort to secure the absent witness for trial, and the witness's preliminary-hearing testimony is marked with indicia of trustworthiness.
The Confrontation Clause of the Sixth Amendment provides:
U.S. Const. amend. VI. The Supreme Court has held that the Confrontation Clause applies to the States through the Due Process Clause of the Fourteenth Amendment to the Constitution of the United States.[1]Pointer *135 v. Texas, 380 U.S. 400, 403-05, 85 S. Ct. 1065, 13 L. Ed. 2d 923 (1965).
In Ohio v. Roberts, 448 U.S. 56, 63-64, 100 S. Ct. 2531, 65 L. Ed. 2d 597 (1980), the Supreme Court held that the Confrontation Clause establishes a rule of admission of evidence by "necessity" that accommodates the interests embodied in the "centuries old" rule against admitting hearsay evidence and that rule's traditional exceptions.[2] Both the Confrontation Clause and the hearsay rule advance the interest of the criminal defendant not to be incriminated by evidence untested in the crucible adversarial of cross-examination. Id. at 63, 100 S. Ct. 2531 (citing Douglas v. Alabama, 380 U.S. 415, 85 S. Ct. 1074, 13 L. Ed. 2d 934 (1965)). Both the Confrontation Clause and the hearsay rule also advance the interests of the People "in effective law enforcement, and in the development and precise formulation of the rules of evidence applicable in criminal proceedings." Id. at 64, 100 S. Ct. 2531. Thus, both the Confrontation Clause and the hearsay rule balance the "competing interests" of the criminal defendant and the People in determining whether prior statements by an absent witness may be admissible in a criminal trial. Id. at 64, 100 S. Ct. 2531 ("This Court, in a series of cases, has sought to accommodate these competing interests.").
In Roberts, 448 U.S. at 65, 100 S. Ct. 2531, the Supreme Court struck the balance between the competing interests of the criminal defendant and the People by framing a two-pronged test for the admissibility of out-of-court statements made in judicial proceedings by a witness who is subsequently absent from the trial. First, the prosecution must show that the witness who made the out-of-court statement is unavailable for trial despite good-faith efforts to locate and present that witness. Id. at 65, 74, 100 S. Ct. 2531. Accord Barber v. Page, 390 U.S. 719, 724-25, 88 S. Ct. 1318, 20 L. Ed. 2d 255 (1968) ("a witness is not `unavailable' for purposes of the ... exception to the confrontation requirement unless the prosecutorial authorities have made a good-faith effort to obtain his presence at trial"). Second, the out-of-court statement must be supported by indicia of trustworthiness. Roberts, 448 U.S. at 65, 100 S. Ct. 2531. Accord Mancusi v. Stubbs, 408 U.S. 204, 216, 92 S. Ct. 2308, 33 L. Ed. 2d 293 (1972). These fact-based determinations are entrusted to the sound discretion of the trial court. Nolen v. State, 469 So. 2d 1326, 1328 (Ala.Crim.App.1985).
In Roberts, 448 U.S. at 75-76, 100 S. Ct. 2531, the Supreme Court held that an out-of-court statement of an absent witness was admissible. The prosecution presented the testimony of one person, the mother of the witness, who stated that she could not find or contact the witness, and presented evidence that the prosecution had made several unsuccessful attempts to subpoena the absent witness. Id.
The Supreme Court quoted portions of the opinion of the state court of appeals, which had held that the prosecution had not sufficiently proved a good-faith effort to procure the witness:
Id. at 60, 100 S. Ct. 2531 (emphasis added) (citation omitted). Despite the prosecution's failure to produce testimony from a member of the prosecution team, and despite other purported deficiencies, the Supreme Court held that the prosecution had sufficiently proved a reasonable good-faith effort by subpoenaing the absent witness and by asking the absent witness's mother about her whereabouts. Id. at 76, 100 S. Ct. 2531. The Supreme Court noted that although the prosecution could have followed up with the social worker by telephone, it was not reasonably required to do so. Id. Thus, the Supreme Court held that the testimony of one witness, who was not a member of the prosecution team, was sufficient to support the admission of the prior testimony of the absent witness, even though all the follow-up leads to find the absent witness had not been exhausted.
In this case, not only did the State present more evidence of a good-faith effort to secure the witness than did the prosecution team in Roberts, it also presented evidence that Roberts expressly held goes beyond the requirements of the Confrontation Clause.[3] As the prosecution did in Roberts, 448 U.S. at 76, 100 S. Ct. 2531, the State subpoenaed the absent witness in this case without success. As the prosecution did in Roberts, id. at 75, 100 S. Ct. 2531, the State talked with various members of the absent witness's family in an effort to determine his whereabouts for trial. The State's investigator also talked to people who lived in Williams's neighborhood, Williams's probation officer, a utility company, and the police, in an effort to find Williams. Prior to trial, when the investigator discovered that Williams was wanted by the police, he had a "hold" put on Williams so that if the jail authorities incarcerated Williams they would contact the investigator. When Williams was arrested, however, the juvenile authorities inadvertently released him before contacting the investigator.[4]
*137 Further, unlike the prosecution in Roberts, the State's investigator made follow-up telephone calls in an effort to track down Williams on the day before trial. Moreover, unlike the prosecution in Roberts, the State took the additional step of placing its investigator on the stand for examination and cross-examination. Although the State could have placed one more telephone call or could have sought to obtain a warrant for Williams's arrest, "the great improbability that such efforts would have resulted in locating the witness, and would have led to [his] production at trial, neutralizes any intimation that a concept of reasonableness required their execution." Roberts, 448 U.S. at 76, 100 S. Ct. 2531. Thus, the State more than met its burden, as defined by the Supreme Court in Roberts, to show a reasonable good-faith effort to locate the absent witness.
The State also met its burden under the second prong of the Confrontation Clause test of admissibility by showing that Williams's out-of-court testimony was supported by indicia of trustworthiness. As with the absent witness's prior statement in Roberts, 448 U.S. at 71-73, 100 S. Ct. 2531, Williams's prior statement was given in open court at a preliminary hearing, and defense counsel was given the opportunity to cross-examine him. As with the defense counsel in Roberts, id. at 71, 100 S. Ct. 2531, Scroggins's defense counsel took advantage of the preliminary hearing to ask Williams questions pertinent to the issue sat trial. Defense counsel thoroughly cross-examined Williams about Scroggins's shooting the victim and about Scroggins's actions immediately thereafter. Thus, as in Roberts, the preliminary-hearing testimony of the absent witness in this case was supported by indicia of trustworthiness ample under the Sixth Amendment's Confrontation Clause to support its admissibility. Accordingly, the trial court did not abuse its discretion in admitting the prior testimony of Williams.
The majority states that the Court of Criminal Appeals in "Johnson v. State[, 623 So. 2d 444, 447-48 (Ala.Crim.App.1993)], set[] a high standard for proving that the State exercised due diligence in its attempt to procure the presence of a witness." 727 So. 2d at 134. The majority states that in Johnson the State sufficiently proved the unavailability of the witness by presenting the testimony of multiple witnesses and evidence of extensive follow-up efforts. 727 So. 2d at 127. The majority then concludes that because the State, in this case, presented the testimony of only one person and did not follow up by seeking a warrant for Williams's arrest, it failed to meet the heightened Confrontation Clause standard set in Johnson. I do not agree that Johnson modified the admissibility standard established by the Supreme Court in Roberts.
The sum total of the Johnson court's legal analysis of the admission of testimony from the absent witness in that case is as follows:
Johnson, 623 So. 2d at 447-48.
This language quoted from Johnson does not purport to set, establish, modify, or replace any standard. Instead, in Johnson the Court of Criminal Appeals cites Matkins, 521 So. 2d at 1041, that expressly relied on the standard established in Roberts, 448 U.S. 56, 100 S. Ct. 2531, 65 L. Ed. 2d 597, which struck the balance between the competing interests of the criminal defendant and the People. It would be strange indeed, for Johnson, which ultimately relied on Roberts, to silently establish a new multiple-witness/follow-up exhaustion *138 standard that the facts in Roberts itself would not meet. At most, Johnson is an application of the federal standard to facts that were more than sufficient to meet that standard.
By the majority's logic, a holding, for example, that video-tape and eyewitness testimony is sufficient evidence to support a conviction of a criminal offense would set a heightened evidentiary standard requiring the reversal of all future convictions that were not equally supported by videotape and eyewitness testimony. This has never been the law. Compare McLeod v. State, 627 So. 2d 1066 (Ala.Crim.App.1993) (upholding a defendant's conviction on a controlled substance offense based on videotape and eyewitness testimony), with Gary v. State, 473 So. 2d 604 (Ala.Crim.App.1985) (upholding a defendant's conviction on a controlled substance offense based on the physical proximity of the defendant and the defendant's possessions to the controlled substance). Thus, the Court of Criminal Appeals did not expressly set a new Sixth Amendment standard in Johnson, and the argument that it implicitly did so is untenable.
Ultimately, it is the Supreme Court of the United States, and not the Court of Criminal Appeals, or this Court, that sets the standard for enforcing the Sixth Amendment to the Constitution of the United States. See Martin v. Hunter's Lessee, 14 U.S. (1 Wheat.) 304, 4 L. Ed. 97 (1816). The majority's interpretation of the Confrontation Clause to require multiple witnesses and the exhaustion of almost all follow-up opportunities is a dramatic departure from the interpretation of that Clause by the Supreme Court of the United States. The majority effectively restrikes the balance established in Roberts for the admissibility of the preliminary-hearing testimony of an absent witness, favoring the interest of the criminal defendant at the expense of the interests of the People.
I dissent.
HOOPER, C.J., and MADDOX and HOUSTON, JJ., concur.
[1] The Due Process Clause provides:
"No State shall ... deprive any person of life, liberty, or property, without due process of law...."
U.S. Const. amend. XIV, § 1.
[2] The Federal Rules of Evidence provide in pertinent part:
"Hearsay is not admissible except as provided by these rules or by other rules prescribed by the Supreme Court pursuant to statutory authority or by Act of Congress."
Rule 802, Fed.R.Evid.
"The following are not excluded by the hearsay rule if the declarant is unavailable as a witness:
"(1) Former Testimony.Testimony given as a witness at another hearing of the same or a different proceeding, or in a deposition taken in compliance with law in the course of the same or another proceeding, if the party against whom the testimony is now offered ... had an opportunity and similar motive to develop the testimony by direct, cross, or redirect examination."
Rule 804(b), Fed.R.Evid.
"`Unavailability as a witness' includes situations in which the declarant
". . . .
"(5) is absent from the hearing and the proponent of a statement has been unable to procure the declarant's attendance ... by process or other reasonable means."
Rule 804(a), Fed.R.Evid.
[3] In this case, the Alabama Rules of Evidence, instead of the Federal Rules of Evidence, were applicable. For purposes of Confrontation Clause analysis in this case, however, there are no substantive differences between the rules. The Alabama Rules of Evidence provide in pertinent part:
"Hearsay is not admissible except as provided by these rules, or by other rules adopted by the Supreme Court of Alabama or by statute."
Rule 802, Ala. R. Evid.
"The following are not excluded by the hearsay rule if the declarant is unavailable as a witness:
"(1) Former Testimony. Testimony of a witness, in a former trial or action, given (A) under oath, (B) before a tribunal or officer having by law the authority to take testimony and legally requiring an opportunity for cross-examination, (C) under circumstances affording the party against whom the witness was offered an opportunity to test his or her credibility by cross-examination, and (D) in litigation in which the issues and parties were substantially the same as in the present cause."
Rule 804(b), Ala. R. Evid. See II Charles W. Gamble, McElroy's Alabama Evidence § 245.07(4)(c) (5th ed.1996) (stating that a preliminary hearing in a criminal proceeding qualifies as a "former trial or action" under Rule 804(b)).
"`Unavailability as a witness' includes situations in which the declarant
". . . .
"(5) is absent from the hearing and the proponent of the statement has been unable to procure the declarant's attendance ... by process or other reasonable means."
Rule 804(a), Ala. R. Evid.
[4] I note that there was no evidence that the jail officials who released Williams were aware that Williams was scheduled to testify at the upcoming trial of Scroggins. Compare Motes v. United States, 178 U.S. 458, 20 S. Ct. 993, 44 L. Ed. 1150 (1900) (reversing the admission of prior testimony of an absent witness where a member of prosecution team released the witness, who was under indictment, under his own recognizance with full knowledge that he would be needed as a witness) with United States v. Mathis, 550 F.2d 180, 182 (4th Cir.1976) (upholding the admission of the prior testimony of an absent witness where "there [was] no evidence that the prison official who released [the witness] knew that [the witness] would be needed as a witness"), cert. denied, 429 U.S. 1107, 97 S. Ct. 1140, 51 L. Ed. 2d 560 (1977). | e01fd32a34d05bd84bc7db8d0a3ca5782727d1f4525e866cb9a7b78b04bc8ef3 | 1998-07-10 00:00:00 |
b595346c-697c-4509-bbb2-d64f7a98ae9f | Ex Parte Exxon Corporation | 725 So. 2d 930 | 1970527 | Alabama | Alabama Supreme Court | 725 So. 2d 930 (1998)
Ex parte EXXON CORPORATION.
(Re Ann Lewis et al. v. Exxon Corporation).
1970527.
Supreme Court of Alabama.
July 17, 1998.
Rehearing Denied December 4, 1998.
Gregory H. Hawley and Stephen C. Jackson of Maynard, Cooper & Gale, P.C., Birmingham; and I. Drayton Pruitt of Pruitt, Pruitt & Watkins, Livingston, for petitioner.
J. L. Chestnut, Jr., of Chestnut, Sanders, Sanders & Pettaway, P.C., Selma, for respondents.
Samuel H. Franklin and Stephen J. Rowe of Lightfoot, Franklin & White, L.L.C., Birmingham, amicus curiae Product Liability Advisory Council, in support of the petitioner.
SEE, Justice.
This mandamus petition arises from the certification of a nationwide class action against Exxon Corporation. Exxon requests an order directing the Circuit Court of Sumter County to decertify the class. Exxon *931 contends that the circuit court abused its discretion by certifying the class without adequately considering the requirements for class certification set forth in Rule 23, Ala. R. Civ. P. Because we conclude that the circuit court certified this class with only a cursory review of the choice-of-law issues and that this action cannot be maintained by the current class representatives, we grant the petition.
The plaintiffs, claiming economic loss, seek damages based on allegedly deceptive trade practices used by Exxon in a marketing campaign it launched to promote Exxon 93 Supreme gasoline. The marketing campaign indicated that the use of Exxon 93 Supreme gasoline would reduce automobile maintenance costs. In September 1996, without admitting liability, Exxon discontinued the marketing campaign, after the Federal Trade Commission ("FTC") had accused Exxon of false and misleading advertising. A number of class actions, including this one, were filed in November 1996; those actions were based primarily on the FTC's allegations against Exxon.
The plaintiffs' principal allegation is that Exxon's marketing campaign increased the demand for Exxon Supreme 93 gasoline, allowing Exxon to inflate the price on Exxon Supreme 93 gasoline, to the detriment of the plaintiffs. The plaintiffs allege that, but for Exxon's marketing campaign, they would not have purchased Exxon Supreme 93 gasoline or would have paid a lower price for that gasoline. Although the advertisements the plaintiffs complain of were not aired in the television and radio markets of Alabama, the plaintiffs allege that these advertisements were displayed at Exxon stations in Alabama and that Alabama citizens could have heard or viewed these advertisements when they traveled outside the state.
The Circuit Court of Sumter County certified a nationwide class action based on the plaintiffs' allegations. Although the plaintiffs' primary allegation is that the members of the class were harmed by detrimentally relying on Exxon's statement that using Exxon Supreme 93 gasoline would reduce maintenance costs in their automobiles, the circuit court did not limit the class to those persons who had purchased that gasoline after having seen or heard the advertisements, but included all persons who had purchased Exxon Supreme 93 gasoline after Exxon launched its marketing campaign. The circuit court denied Exxon's request to decertify the class, and this mandamus petition followed.
A mandamus petition is the proper procedural tool to challenge the certification of a class action.[1]Ex parte Blue Cross & Blue Shield, 582 So. 2d 469 (Ala.1991). Mandamus relief, however, is rarely appropriate, and is limited to those cases in which the party seeking relief has demonstrated a compelling reason for that relief. Ex parte Green Tree Fin. Corp., 684 So. 2d 1302, 1307 (Ala.1996). Exxon has demonstrated that the circuit court failed to conduct the rigorous choice-of-law analysis necessary before class certification, and that the class is not maintainable by the current class representatives. See Green Tree, 684 So. 2d at 1307 (stating that when the trial court has certified a class before assuring that all the prerequisites of Rule 23, Ala. R. Civ. P., have been satisfied, the petitioner has presented a compelling reason for mandamus relief).
Exxon argues that the circuit court abused its discretion by venturing into uncharted territory and certifying a nationwide class based on a novel "fraud-on-the-market," presumption-of-reliance theory heretofore recognized only in federal securities law. Exxon argues that the circuit court did this without first considering whether the various states would recognize such a cause of action. Exxon contends that the certification in this case effectively imposes a new law in at least 40 statesa law that turns on its head the existing law of fraud by doing away with *932 such fundamental liability principles as exposure, reliance, and causation. Exxon contends that this "fraud-on-the-market" legal theory was not an appropriate basis for class certification, and that the certification order, in fact, left important choice-of-law questions unaddressed.
The plaintiffs contend that the circuit court's certification order did not leave the questions concerning choice of law unanswered. The plaintiffs argue that the circuit court properly recognized that one state's law might apply to the entire case, and that, if choice-of-law issues arose in the future, they could be appropriately dealt with through subclasses or through specific jury interrogatories. We disagree and we conclude that the circuit court's choice-of-law analysis was not a rigorous one. See generally Ex parte Citicorp Acceptance Co., 715 So. 2d 199 (Ala.1997) (requiring a "rigorous analysis" of the requirements necessary for class certification, including an analysis of the applicable choice of law).
Before a circuit court determines that an action should be certified as a class action, it must determine that the questions of law predominate over any questions affecting only individual members of the class. Rule 23(b)(3), Ala. R. Civ. P. In Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 821, 105 S. Ct. 2965, 86 L. Ed. 2d 628 (1985), the United States Supreme Court cautioned that in the context of class certification, the court "may not take a transaction with little or no relationship to the forum and apply the law of the forum ... to satisfy the procedural requirement that there be a `common question of law.'"
The circuit court's certification order states simply that "one state's law might apply to the entire class." Not only does this statement stand in stark contrast to Alabama's general choice-of-law principles, which mandate that Alabama courts "determine the substantive rights of an injured party according to the law of the state where the injury occurred," Fitts v. Minnesota Mining & Manufacturing Co., 581 So. 2d 819, 820 (Ala.1991), but the circuit court, in its assessment that one state's law might apply to the entire class, failed to consider whether that one state would have "`a significant contact or significant aggregation of contacts' " to the claims asserted by each plaintiff to ensure that the choice of law was not arbitrary or unfair to Exxon. Shutts, 472 U.S. at 818, 105 S. Ct. 2965.
The plaintiffs seek relief based on New Jersey's consumer protection laws, but they have made no showing (1) that the separate states where the members of the class reside would recognize the application of New Jersey consumer fraud law, (2) that New Jersey consumer fraud law was consistent with the consumer fraud laws of the several states, or (3) that New Jersey had sufficient contacts with each of the individual plaintiffs for New Jersey law to apply. See In re Ford Motor Co. Ignition Switch Products Liab. Litigation, 174 F.R.D. 332, 349 (D.N.J.1997)[2] (stating that "plaintiffs bear the burden of providing an `extensive analysis' of state law variations to determine whether there are `insuperable obstacles' to class certification"). In addition, the plaintiffs have failed to demonstrate that the New Jersey courts would recognize a "de facto consumer fraud," presuming that all purchasers of Exxon Supreme 93 gasoline were harmed by Exxon's marketing campaign. See In re American Med. Sys., Inc., 75 F.3d 1069, 1085 (6th Cir.1996) (stating that in certifying a nationwide class the district court had abused its discretion by failing to consider how the laws of negligence differ from jurisdiction to jurisdiction, and stating that "[i]f more than a few of the laws of the fifty states differ, the district court would face an impossible task of instructing a jury on the relevant law"); Castano v. American Tobacco Co., 84 F.3d 734, 750 (5th Cir.1996) (stating that the district court had abused its discretion by embarking "on a road certainly less traveled, if ever taken at all," in certifying a nationwide class action based on a wholly untested and novel theory without *933 considering how the variations in state law might affect predominance, and relying solely on the plaintiffs' allegations that no variations in the state laws would prevent certification). Thus, notwithstanding the circuit court's statements in its certification order, a court must, before certifying a class, make a choice-of-law determination, including a determination of whether variations in state law defeat predominance.[3]
Even more important than the circuit court's failure to conduct the proper choice-of-law analysis is the fact that the class is not maintainable by the current class representatives. Alabama law does not allow consumers to bring class actions based on deceptive trade practices. Ala.Code 1975, § 8-19-10(f).[4] Although consumers are allowed to pursue their individual actions, class relief is reserved for the office of the attorney general or a district attorney. Id. Thus, because the gravamen of the plaintiffs' complaint is that Exxon engaged in a deceptive trade practice by promoting its Exxon 93 Supreme gasoline as superior to other types of gasoline, the plaintiffs are procedurally barred from representing a class in this case. That the plaintiffs seek to apply New Jersey law to this case is not dispositive. See generally Cherry, Bekaert & Holland v. Brown, 582 So. 2d 502, 507 (Ala.1991) (stating that "where application of [another] state's laws would be contrary to Alabama policy, the parties' choice of law will not be given effect and Alabama law will govern"). Otherwise, by suing under another state's law that is more favorable to the results they seek, parties could circumvent the clear intent of the Alabama legislature and, in effect, force this Court to judicially create new procedures or causes of action.
This Court has previously rejected a plea to "`reopen an avenue to litigation that the Legislature, in its wisdom, closed,'" D.D. v. C.L.D., 600 So. 2d 219, 223 (Ala.1992), and a plea to create a private cause of action through statutory construction, when the legislature had no such intent in enacting the statute. Bama Budweiser of Montgomery, Inc. v. Anheuser-Busch, Inc., 611 So. 2d 238, 248 (Ala.1992). Similarly, in this case we refuse to ignore the legislature's action expressly reserving class representation to the attorney general or a district attorney; we will not, contrary to Alabama's legislative policy, allow a consumer to represent the *934 class.[5] Thus, because Alabama law prevents consumers from representing a class seeking relief for a defendant's alleged deceptive trade practices, the current class representatives cannot maintain this action as a class action.[6]
Because the circuit court certified this class with only a cursory review of the choice-of-law issues and because the current class representatives cannot maintain this action as a class action, Exxon has demonstrated a clear legal right to an order decertifying the class.
WRIT GRANTED.
HOOPER, C.J., and MADDOX and SHORES, JJ., concur.
COOK, J., concurs in the result.
LYONS, J., recuses himself.[*]
[1] Because a writ of mandamus is an extraordinary remedy, the party seeking it must demonstrate: "(1) a clear legal right in the petitioner to the order sought; (2) an imperative duty upon the respondent to perform, accompanied by a refusal to do so; (3) the lack of another adequate remedy; and (4) properly invoked jurisdiction of the court." Ex parte Alfab, Inc., 586 So. 2d 889, 891 (Ala.1991).
[2] Because Ala. R. Civ. P. 23 is substantially identical to Fed.R.Civ.P. 23, in interpreting our Rule 23 we use cases interpreting the federal rule as persuasive authority. First Baptist Church of Citronelle v. Citronelle-Mobile Gathering, Inc., 409 So. 2d 727, 729 (Ala.1981).
[3] This Court has previously affirmed a trial court's order rejecting a similar request for a class certification based on a fraud-on-the-market, presumption-of-reliance theory. Butler v. Audio/Video Affiliates, Inc., 611 So. 2d 330 (Ala. 1992). In Butler, the plaintiff sought to have a class certified based on the defendant's alleged bait-and-switch tactics. Id. at 331. The plaintiffs requested certification of a class that included not only those who had viewed an advertisement for a lower-priced product and then had purchased a higher-priced product while at the store, but also those who merely purchased the higher-priced non-advertised product. Id. This Court affirmed the trial court's order refusing to certify the class, where the trial court stated that "the plaintiffs adduced no evidence concerning how individuals who were fraudulently baited and switched could be distinguished from those who purchased a different item for other reasons" and "each and every purchaser of a non-advertised item from [the defendant] would have to be questioned to ascertain why he or she (i) went to the store and (ii) purchased a non-advertised item." Id. at 331-32. Similarly, in this case the plaintiffs have adduced no evidence as to why persons who did not see or hear the Exxon 93 Supreme gasoline advertisement purchased the gas. Thus, each member of the class who did not see or hear the advertisement would be required to testify as to why he purchased the Exxon Supreme 93 gasoline; this would cause questions of fact peculiar to individuals to predominate over questions of fact common to the entire class and thereby render class certification inappropriate. See generally Ex parte AmSouth Bancorporation, 717 So. 2d 357 (Ala.1998) (reversing an order that certified a class action where individual claims of fraud would predominate).
[4] Section 8-19-10, Ala.Code 1975, provides:
"(f) A consumer or other person bringing an action under this [`Deceptive Trade Practices'] chapter may not bring an action on behalf of a class; provided, however, that the office of the Attorney General or district attorney shall have the authority to bring action in a representative capacity on behalf of any named person or persons. In any such action brought by the office of the Attorney General or a district attorney the court shall not award minimum damages or treble damages, but recovery shall be limited to actual damages suffered by the person or persons, plus reasonable attorney's fees and costs."
(Emphasis added.)
[5] See also Rule 81(a)(32), Ala. R. Civ. P. (noting that a rule of civil procedure, such as Rule 23, that is contrary to the practice provided for by statute is displaced by that statute).
[6] Because class certification was inappropriate, we need not address Exxon's argument that the circuit court, before ruling on the question of class certification, should have ruled on Exxon's motion for a change of venue.
[*] Note from the reporter of decisions: This opinion was corrected on December 4, 1998, to reflect Justice Lyons's recusal. | ea1b5053bddc840986e246e884480b564c3688da4f58560c81f466993d8476db | 1998-07-17 00:00:00 |
81946213-186e-4011-899a-bb4307606ca2 | Ridgeway v. CSX Transp., Inc. | 723 So. 2d 600 | 1970038 | Alabama | Alabama Supreme Court | 723 So. 2d 600 (1998)
Al RIDGEWAY, individually and as personal representative of the estate of Debbie Ridgeway, deceased
v.
CSX TRANSPORTATION, INC., and the Town of Thorsby.
1970038.
Supreme Court of Alabama.
July 31, 1998.
Rehearing Denied October 16, 1998.
*601 William Dudley Motlow, Jr., Don L. Hall, and W. Perry Webb of Porterfield, Harper & Mills, P.A., Birmingham, for appellant.
David L. McAlister of Lusk, Fraley, McAlister & Simms, P.C., Birmingham, for appellee CSX Transportation, Inc. (Mr. McAlister signed CSX's brief as "Attorney for National Railroad Passenger Corporation").
Timothy P. Donahue and John C. Webb V of Bradford & Donahue, P.C., Birmingham, for appellee Town of Thorsby.
HOUSTON, Justice.
The plaintiff Al Ridgeway, individually and as the personal representative of the estate of his wife Debbie Ridgeway, appeals from summary judgments for the defendants CSX Transportation, Inc. ("CSX"), and the Town of Thorsby, in an action to recover damages for personal injury and wrongful death.[1] We affirm.
A summary judgment is proper when there is no genuine issue of material fact and the moving party is entitled to a judgment as a matter of law. Rule 56, Ala.R.Civ.P. In determining, on a summary judgment motion, whether there is a genuine issue of material fact, the court must view the evidence in the light most favorable to the nonmoving party, resolving all reasonable doubts against the moving party. The burden is initially on the moving party to make a prima facie showing that no genuine issue of material fact exists and that it is entitled to a judgment as a matter of law. If it makes that showing, then the burden shifts to the nonmoving party to present evidence creating a material factual issue for resolution by a jury, so as to avoid the entry of a judgment. Hilliard v. City of Huntsville Electric Utility Board, 599 So. 2d 1108 (Ala.1992).
The evidence, viewed in the light most favorable to the plaintiff Al Ridgeway, indicates the following: Debbie Ridgeway suffered *602 severe personal injuries on March 8, 1995, when the vehicle she was driving collided with an Amtrak passenger train at the Concordia Avenue railroad crossing in the Town of Thorsby, in Chilton County. The accident occurred as Ms. Ridgeway travelled east on Concordia Avenue and across the track and as the train was proceeding north. The stretch of track that crosses Concordia Avenue is owned by CSX. CSX had no ownership interest in, and did not operate, the train. The collision occurred at approximately 12:30 p.m.; the weather was cold, and visibility at the crossing was good. The track is straight and flat on both sides of the crossing, and there were no obstructions, of vegetation or of any other kind, to Ms. Ridgeway's view of the train as it approached Concordia Avenue. The track is slightly elevated at the crossing, so that motorists crossing the track encounter a hump. Ms. Ridgeway approached the crossing from the westthe left side of the track as viewed from the perspective of the train's crew. Approaching the crossing, Ms. Ridgeway encountered a railroad "crossbuck"a large "X" made of two crossed pieces of wood or metal, painted white, with the words "RAILROAD" and "CROSSING" written across the overlapping pieces in black paintand a faded "stop" sign. Just east of the crossing, Concordia Avenue intersects with Highway 31, which at that point runs parallel with the railroad track. A traffic light at that intersection regulates access from Concordia Avenue to Highway 31. That traffic light, which was green in the direction of Concordia Avenue at the time of the accident, was visible to Ms. Ridgeway as she approached the crossing. Ms. Ridgeway, a longtime resident of Chilton County, was familiar with the area around the crossing (she shopped regularly at a grocery store near the crossing), and she knew that the railroad track crossed Concordia Avenue at this point.
Two eyewitnesses observed the collision: Mike Smith, the engineer of the train; and Greta Schoolar, the driver of another motor vehicle. Ms. Schoolar had stopped her vehicle at the traffic light at the intersection of Concordia Avenue and Highway 31. She was heading south on Highway 31. She heard the train sounding its horn and looked up to see the train as it approached the crossing. She then noticed Ms. Ridgeway's vehicle as it approached the crossing. She testified:
Mike Smith, the train's engineer, testified that the train was traveling at approximately 45 miles per hour just before the collision; this speed was within the maximum speed limit for that stretch of track. He began sounding the train's horn as the train passed the "whistle board";[2] the train's headlights were on and there were no mechanical problems with the train's brakes. When asked about Ms. Ridgeway's actions as she approached the crossing, Smith stated that her vehicle "never did slack up."
Al and Debbie Ridgeway sued CSX and the Town of Thorsby, alleging negligence and wantonness. Specifically, the Ridgeways alleged that CSX had, among other things, negligently or wantonly failed to install active warning devices, such as lights, bells, or gates, at the crossing.[3] They alleged that the Town of Thorsby had negligently or wantonly failed to properly maintain the crossing. Specifically, they alleged that the town had failed to maintain the stop sign that was located beside the crossing and facing the eastbound lane of Concordia Avenue, and that the town had otherwise failed to install adequate warning signs, pavement markings, or warning devices at the crossing. Debbie Ridgeway sought compensatory and punitive damages as a result of the severe personal injuries she had suffered when the train hit her vehicle; Al Ridgeway sued derivatively for loss of consortium. Debbie Ridgeway died from her injuries while this action was pending; Al Ridgeway, after being appointed personal representative of her estate, amended the complaint by adding a claim seeking damages for wrongful death. The trial court entered separate summary judgments for CSX and the Town of Thorsby.
The following issues are dispositive of this appeal:
With respect to the first issue, both CSX and the Town of Thorsby contend that Ms. Ridgeway was herself negligent and that *604 her own negligence was the proximate cause of the accident that resulted in her death. They argue that Ms. Ridgeway failed to stop, look, and listen at the Concordia Avenue crossing, in violation of Ala. Code 1975, § 32-5A-150, and that that failure was unquestionably the proximate cause of her death. Mr. Ridgeway contends that a fact question was presented as to whether Ms. Ridgeway acted reasonably under the circumstances.[5] He argues that a jury could find that the layout of the various intersecting roads adjacent to the Concordia Avenue crossing, the faded stop sign, and the traffic light at the intersection of Concordia Avenue and Highway 31, when considered together, created a confusing and hazardous situation that Ms. Ridgeway, all the while exercising due care, was attempting to deal with at the time of the accident.
Section 32-5A-150 provides in pertinent part:
The "stop, look, and listen" doctrine set out in § 32-5A-150 is also firmly rooted in our caselaw. See, e.g., Southern Ry. v. Randle, 221 Ala. 435, 438, 128 So. 894, 897 (1930):
(Emphasis original.)
Also deeply rooted in Alabama law is the rule that a person who fails to stop, look, and listen before crossing a railroad track is, in the absence of special circumstances, contributorily negligent as a matter of law. In Lambeth v. Gulf, Mobile & Ohio R.R., 273 Ala. 387, 389, 141 So. 2d 170, 172 (1962), Justice Simpson, writing for this Court, stated:
And in Callaway v. Adams, 252 Ala. 136, 142, 40 So. 2d 73, 77-78 (1949), this Court wrote:
*606 See also McCullough v. L & N R.R., 396 So. 2d 683 (Ala.1981); Stallworth v. Illinois Central Gulf R.R., 690 F.2d 858 (11th Cir. 1982) (surveying Alabama law); Gibson v. Norfolk Southern R.R., supra.
After carefully considering the evidence presented in this case, including the photographs of the Concordia Avenue crossing, we conclude that the only reasonable inference that can be drawn from that evidence is that Ms. Ridgeway's tragic death was the result of her own failure to exercise reasonable care. Contributory negligence is an affirmative and complete defense to a claim based on negligence. In order to establish contributory negligence, the defendant bears the burden of proving that the plaintiff 1) had knowledge of the dangerous condition; 2) had an appreciation of the danger under the surrounding circumstances; and 3) failed to exercise reasonable care, by placing himself in the way of danger. See Knight v. Alabama Power Co., 580 So. 2d 576 (Ala.1991). In the present case, CSX and the Town of Thorsby had the burden of proving 1) that Ms. Ridgeway failed to exercise reasonable care (i.e., had failed to stop, look, and listen) and 2) that that failure was the proximate cause of her accident. Norfolk Southern R.R. v. Thompson, 679 So. 2d 689 (Ala. 1996).
The record indicates that CSX made a prima facie showing that Ms. Ridgeway was aware of the existence of the Concordia Avenue railroad crossing and that she understood or should have understood the danger posed by the crossing. The undisputed evidence indicated that Ms. Ridgeway was familiar with the area around the crossing and that she traveled it on a regular basis during her trips to and from a nearby grocery store. The crossing was clearly marked with a standard "crossbuck" facing the eastbound lane, in which Ms. Ridgeway was traveling, and the presence of the track itself was highlighted by the hump in the road where the track crossed Concordia Avenue. There were no obstructions in the vicinity of the crossing that could have obscured Ms. Ridgeway's view of the "crossbuck" or the track.
The record also indicates that Ms. Ridgeway, for whatever reason, failed to exercise reasonable care, by placing herself in harm's way. The only two eyewitnesses to the accident testified that Ms. Ridgeway did not stop, look, and listen before crossing the track, as required by Alabama law. The undisputed evidence indicated that had she done so she would have realized that the train was dangerously close to the crossing and, one can assume, would not have attempted to cross in front of the train. The track is straight and flat on both sides of the crossing and, as noted, there were no obstructions to Ms. Ridgeway's view of the train as it approached the crossing. The train's engineer testified, without dispute, that he sounded his horn as he approached the crossing and that he had the train's headlights on. The other eyewitness, Ms. Schoolar, corroborated the engineer's testimony that the train's horn was sounding as the train approached the crossing. There is a rebuttable presumption that a person in possession of his normal faculties will follow the law of self-preservation and exercise ordinary care for his own personal protection. Alabama Great Southern R.R. v. Evans, 288 Ala. 25, 256 So. 2d 861 (1972). The evidence was sufficient to overcome this presumption with respect to Ms. Ridgeway. Mr. Ridgeway presented no evidence that would rebut the defendants' prima facie showing that Ms. Ridgeway was negligent as a matter of law.
We conclude that the undisputed facts were such that all reasonable people would logically have to draw the same conclusion that Ms. Ridgeway was contributorily negligent.
We note that we have fully considered the argument that Ms. Ridgeway could have been distracted by the traffic and the traffic light at the intersection of Concordia Avenue and Highway 31. Although we agree with Mr. Ridgeway that one could reasonably infer, especially from Ms. Schoolar's testimony, that Ms. Ridgeway was distracted as she approached the crossing, we do not agree that such an inference creates a jury question with respect to the issue of contributory negligence. Ms. Ridgeway was under a statutory and common-law duty to stop, look, and listen before she attempted to cross the track. Nothing in the evidence suggests she *607 was in any way prevented from doing that. The undisputed evidence clearly indicates that the accident would not have occurred had Ms. Ridgeway looked and listened sufficiently to note the noise and the appearance of the approaching train.
We also recognize, as Mr. Ridgeway correctly points out, that the issue of contributory negligence is generally one for a jury to resolve. See Norfolk Southern R.R. v. Thompson, supra; Savage Industries, Inc. v. Duke, 598 So. 2d 856, 859 (Ala.1992) ("[t]he issue of contributory negligence cannot be determined as a matter of law where different inferences and conclusions may reasonably be drawn from the evidence"). In fact, this Court has been most reluctant over the years to find contributory negligence as a matter of law. See, e.g., Central Alabama Electric Co-op. v. Tapley, 546 So. 2d 371, 381 (Ala.1989), wherein a majority of this Court, as it was then constituted, went so far as to state, in note 8, that it "might be willing to again entertain, in an appropriate case, the idea of adopting the doctrine of comparative negligence." Of course, this Court later decided not to abandon the doctrine of contributory negligence, which has now been the law in Alabama for approximately 167 years. See Williams v. Delta International Machinery Corp., 619 So. 2d 1330 (Ala.1993).
Thus, it remains the law in this state that when a motorist, in violation of § 32-5A-150, fails to stop, look, and listen before crossing a railroad track and that failure results in injury or death caused by a collision with a passing train, the motorist is guilty of contributory negligence as a matter of law, unless special circumstances existing at the crossing suggest that even by keeping a proper lookout he could not have been aware of the presence of the railroad crossing or of the danger presented by that crossing. See Lambeth v. Gulf, Mobile & Ohio R.R., supra, and the cases cited therein;[6]Callaway v. Adams, supra, and the cases cited therein; and Norfolk Southern R.R. v. Thompson, supra; see also Louisville & N.R.R. v. Williams, 370 F.2d 839 (5th Cir. 1966) (citing a number of Alabama cases *608 recognizing both the general rule that it is contributory negligence as a matter of law for a motorist to fail to stop, look, and listen before crossing a railroad track and the exception to that rule that may result from an unusually dangerous crossing); National Railroad Passenger Corp., ("Amtrak") v. H & P, Inc., 949 F. Supp. 1556 (M.D.Ala.1996) (holding under Alabama law that the driver of a truck was contributorily negligent as a matter of law in failing to yield the right-of-way to an approaching train).
Because Ms. Ridgeway's contributory negligence was a complete defense to the negligence claims against CSX and the Town of Thorsby, the summary judgments were proper as to those claims.
With respect to the second issue, Mr. Ridgeway contends that he presented substantial evidence indicating that CSX was aware that previous accidents had occurred at the Concordia Avenue crossing and that CSX had received complaints from the Town of Thorsby questioning the safety of the Concordia Avenue crossing.[7] According to Mr. Ridgeway, that evidence "made out a case for the jury on the issue of CSX's wantonness." CSX contends that, having erected the "crossbuck" facing the eastbound lane on Concordia Avenue, it was at the time of the accident in full compliance with Alabama law. CSX argues that, as a matter of law, its compliance with Alabama law precludes any finding of wantonness.
Wantonness is conduct "carried on with a reckless or conscious disregard of the rights or safety of others." Ala. Code 1975, § 6-11-20(b)(3). Specifically, wantonness involves the conscious doing of some act, or the omission of some duty, under knowledge of existing conditions and while conscious that from the doing of such act or omission of such duty injury will likely or probably result. Before a party can be said to be guilty of wanton conduct, it must be shown that, with reckless indifference to the consequences, he consciously and intentionally did some wrongful act or omitted some known duty that produced the injury. Hamme v. CSX Transp., Inc., 621 So. 2d 281 (Ala.1993).
Section 37-2-80, Ala. Code 1975, provides:
The parties have cited no other statutory provision requiring a railroad to erect and maintain signs or other warning devices at railroad crossings, and we have found no other such provision. See Watson v. Birmingham Southern R.R., 259 Ala. 364, 66 So. 2d 903 (1953); see, also, Radford v. Seaboard System R.R., 828 F.2d 1552 (11th Cir. 1987). In Alabama, there is no duty on the part of a railroad, beyond that set out in § 37-2-80, to erect signs at a railroad crossing or to otherwise take special steps to warn approaching motorists of the presence of a railroad crossing, unless the crossing is a hazardous one in the sense that it cannot be traversed safely through the exercise of ordinary care. See Lambeth v. Gulf, Mobile & Ohio R.R., supra, wherein this Court stated:
273 Ala. at 389-90, 141 So. 2d at 172; see also Westbrook v. Gibbs, 285 Ala. 223, 231 So. 2d 97 (1970).
The undisputed evidence indicated that CSX had complied with § 37-2-80 by erecting the "crossbuck" and that it had placed the crossbuck in such a prominent location beside the eastbound lane on Concordia Avenue that Ms. Ridgeway could have easily seen it as she approached the crossing. In addition, it is undisputed that Ms. Ridgeway was familiar with the area around the crossing and that she knew, or should have known, that the track was there.[8] Furthermore, the undisputed evidence indicated that no special conditions existed at the crossing that could have rendered the crossing unusually dangerous even if Ms. Ridgeway had exercised reasonable care as she crossed the track. As previously noted, the track on both sides of the crossing is straight and flat and there were no obstructions blocking Ms. Ridgeway's view. Therefore, this case is not like Norfolk Southern R.R. v. Thompson, supra, where the evidence indicated that, because of a sharp curve in the track near the crossing, a motorist would have limited visibility and, as a result, could find himself in the path of a fast-moving train even though he had exercised reasonable care in attempting to cross the track; and this case is not like Callaway v. Adams, supra, where the evidence indicated that the plaintiff did not know the railroad crossing was ahead of him and could not have discovered its presence through the exercise of reasonable care in time to avoid a collision with the train, because of the grading of the road in front of the crossing and the fact that overhanging tree branches had obscured the crossing's signal light from view.
*610 We conclude that CSX was under no statutory or common-law duty to take steps to have active warning devices erected at the Concordia Avenue crossing. Based on this conclusion, we hold that CSX's summary judgment was also proper as to the wantonness claim, because if CSX breached no duty imposed by law then it could not be guilty of wantonness.
The summary judgments are affirmed.
AFFIRMED.
HOOPER, C.J., and MADDOX, ALMON, SHORES, COOK, SEE, and LYONS, JJ., concur.
KENNEDY, J., dissents.
[1] The complaint also named Chilton County, the Chilton County Commission, and the individual members of the county commission as defendants. The trial court entered a separate summary judgment for those defendants; that judgment was not appealed.
[2] A "whistle board" is a sign marker the railroad places beside the track to remind the train crew that it is approaching a crossing and needs to sound the horn. See Gibson v. Norfolk Southern Corp., 878 F. Supp. 1455 (N.D.Ala.1994), aff'd, 48 F.3d 536 (11th Cir.1995).
[3] "Active warning devices" are defined by 23 C.F.R. § 646.204(j) (1997), as "those traffic control devices activated by the approach or presence of a train, such as flashing light signals, automatic gates and similar devices, as well as manually operated devices and crossing watchmen, all of which display to motorists positive warning of the approach or presence of a train."
[4] Relying on CSX Transportation, Inc. v. Easterwood, 507 U.S. 658, 113 S. Ct. 1732, 123 L. Ed. 2d 387 (1993), CSX also argues that the state law claims were preempted by the Federal Railroad Safety Act of 1970, 45 U.S.C. § 421 et seq. (1988 ed. and Supp. II); the Highway Safety Act of 1973, 23 U.S.C. § 130 et seq.; and the federal regulations promulgated thereunder by the Federal Highway Administration. However, in light of our holding that the summary judgment is due to be affirmed on other grounds, we pretermit any discussion of the preemption issue.
[5] Although Mr. Ridgeway argues strenuously to the contrary, we note that Hamlin v. Norfolk Southern R.R., 686 So. 2d 1115 (Ala.1996), does not control either of the issues in this case. In Hamlin, this Court reversed summary judgments in two consolidated cases involving vehicle-train collisions at railroad crossings. The summary judgments in those cases were based solely on the doctrine of federal preemption. The sole issue addressed by this Court was whether the trial court had erred in ruling that the plaintiff's claims were preempted. We held that the trial court had erred, stating that "the plaintiffs' claims are not preempted by federal law." 686 So. 2d at 1120. Mr. Ridgeway argues that because we did not affirm on other grounds, which we could have done if the records had clearly demonstrated that the defendants were entitled to judgments as a matter of law, Smith v. Equifax Services, Inc., 537 So. 2d 463 (Ala.1988), then we must have rejected the other arguments made by the defendants touching on the issues of initial legal liability (duty to install active warning devices) and contributory negligence. Suffice it to say that this Court in Hamlin was first and foremost concerned with the preemption issue; the trial court had not ruled on the other issues, and this Court was unwilling to affirm the summary judgments based on the state of the records in those cases.
[6] In Lambeth, this Court affirmed a judgment for the defendant railroad, based on a holding that the plaintiff was contributorily negligent as a matter of law. This Court discussed the facts, noting that the special circumstances mentioned in Callaway v. Adams were not present:
"Pretermitting discussion of the negligence, vel non, of the defendant, we address the question of whether or not the plaintiff was guilty of contributory negligence which proximately caused his damages. We hold that he was and this is dispositive of the case.
"The evidence showed that the accident occurred about 10:00 P.M. on a clear night when the appellant had a clear view of the crossing several hundred yards before reaching it; there was no fog or smoke or anything to obstruct his vision; although he was not a regular traveler on that road, he traveled it about twice a year, had been over it four or five months previously, and knew that the track was there. There was a gradual curve in the road but there was a straight stretch of road for a considerable distance before reaching the crossing. Some considerable distance from the crossing there was a circular warning sign, plainly visible, bearing the letters `R/R'. In addition to this sign, also visible for a considerable distance from the track, there were two `crossbuck' signs and an Alabama `Stop' sign. Appellant testified he knew these signs were warnings of a railroad crossing, but claimed he did not notice them, but instead was traveling about 40 to 45 miles per hour and did not reduce his speed until within about 38 feet of the train, when he first saw it on the track blocking the crossing, which was too late to avert the crash; he knew he should not override his lights, meaning `drive so fast that you can't see an object in time to stop', which he was doing; he was traveling at such a rate of speed that when he saw the train on the crossing he could not then stop his automobile to avoid the collision.
"....
"Appellant argues that the rule of Callaway v. Adams, 252 Ala. 136, 40 So. 2d 73 [ (1949) ], controls the instant situation. That case, however, is without influence here. There, because of the peculiar environment surrounding the railroad crossing, special conditions of hazard such as the topography and grade and course of the highway and overhanging tree limbs obstructing the signal light, the presence of the train could not, by the exercise of reasonable care, be discovered until immediately upon it, thus disclosing an environment producing such special circumstances or conditions of hazard as made it a jury question as to whether or not the railroad company was guilty of negligence, and whether or not plaintiffa stranger to the situationwas guilty of contributory negligence. Here, however, no conditions of hazard and no peculiar environment confronted the plaintiff. Clearly then, the Callaway v. Adams case, supra, is inapplicable."
273 Ala. at 389-90, 141 So. 2d at 171-72.
[7] Much of this evidence was excluded by the trial court on various grounds, and Mr. Ridgeway challenges the trial court's rulings in this respect. Because our holding would not be different if we considered the excluded evidence, we will assume for the purposes of this appeal that all of the evidence was admissible on the question of wantonness.
[8] This Court has emphasized that a motorist's knowledge of the existence of a railroad crossing weighs heavily against a finding that the crossing was hazardous and that the railroad, therefore, had a heightened duty of care. In Coe v. Louisville & Nashville R.R., 272 Ala. 115, 118, 130 So. 2d 32, 34-35 (1961), this Court explained:
"There were two cross-arm signs at the crossing. There was evidence to the effect that these signs were not visible to vehicles approaching the crossing from the west because of trees which hid them from view. This was the situation at a point four hundred feet west of the crossing and perhaps even closer, according to the evidence.
"But plaintiff's intestate lived within three or four blocks of the crossing. It is without dispute that he was thoroughly familiar with the crossing.
"Hence the inability of plaintiff's intestate to see the cross-arm signs at the time of the accident because of the trees does not add to plaintiff's case.
"The object of such signals is to impart notice to the traveler of the location of the railroad track. But when one is shown to already possess that notice, the failure to properly display the signs will not give rise to a cause of action or support a charge of negligence based on such omission, for the manifest reason that the one for whose benefit the sign was required already possessed the knowledge that the sign was intended to impart. Cincinnati, N.O. & T.P. Ry. Co. v. Wallace's Adm'r, 267 Ky. 661, 103 S.W.2d 91 [(1937)]. Those signs were designed to show the location of the train track, not to inform a traveler of the approach of a train. As shown above, plaintiff's intestate was thoroughly familiar with the crossing.
"We are of the opinion that the plaintiff completely failed to meet the burden which was upon her to show a duty on the part of the defendants to give notice of the fact that the train was blocking the crossing at the time in question and that a failure to give such notice was the proximate cause of the collision and the consequent injury and death of plaintiff's intestate." | 9046f1c2bddc68fb3a19561beab2030c3ae4d9d2b3630169a42b632824a995b6 | 1998-07-31 00:00:00 |
c9ebec59-d0a7-482e-b0e7-df016a5cdfa5 | Hayes v. Alabama State Bar | 719 So. 2d 787 | 1961845, 1961847, 1962071, 1962074, 1970021, 1970892 | Alabama | Alabama Supreme Court | 719 So. 2d 787 (1998)
Robert J. HAYES
v.
ALABAMA STATE BAR (1961845 and 1962074). (Two Cases)
Huel M. CARTER
v.
ALABAMA STATE BAR (1961846).
Robert B. RODEN
v.
ALABAMA STATE BAR (1961847 and 1962073). (Two Cases)
Ex parte Robert B. RODEN.
(Re Robert B. RODEN
v.
ALABAMA STATE BAR) (1962071).
Ex parte Robert J. HAYES.
(Re Robert J. HAYES
v.
ALABAMA STATE BAR) (1962072).
Ex parte Huel M. CARTER.
(Re Huel M. CARTER
v.
ALABAMA STATE BAR) (1970021 and 1970892). (Two Cases)
1961845 to 1961847, 1962071 to 1962074, 1970021 and 1970892.
Supreme Court of Alabama.
June 19, 1998.
Robert J. Hayes, appellant/petitioner, pro se.
David B. Byrne, Jr., of Robison & Belser, P.A., Montgomery, for appellant/petitioner Huel M. Carter.
*788 Fournier J. Gale, Birmingham, for appellant/petitioner Robert B. Roden.
Milton L. Moss, asst. general counsel, Alabama State Bar, for appellee/respondent.
PER CURIAM.
These nine cases stem from the Alabama State Bar's filing formal charges against Robert B. Roden, Robert J. Hayes, and Huel M. Carter and from the Bar's actions in determining, pursuant to Rule 22, Ala.R.Disc. P., that Roden, Hayes, and Carter (the "attorneys") had committed "serious crimes." The attorneys appeal, alleging various errors on the part of the Bar in the handling of these disciplinary proceedings.
The Bar adopted in its consolidated brief the statement of facts set forth in the attorneys' briefs to this Court. Those facts are as follows: In June 1994, Richard Poff, a former runner/clerk with the attorneys' firm, filed a complaint with the Bar against the attorneys, and a 13-month investigation of the attorneys by the Bar ensued. Starting in July 1995, following the culmination of the Bar's investigation of Poff's complaint, a 10-month period passed during which no action was taken on the complaint. Then on May 15, 1996, almost two years from Poff's filing of the complaint, the Bar filed formal disciplinary charges against the attorneys.
However, on July 14, 1996 in separate criminal matters, the attorneys were indicted by a Jefferson County Grand Jury for conduct related to their practice of law.[1] On July 24, 1996, before trial on these indictments, the Bar made an interim suspension of the attorneys from the practice of law, alleging that their conduct "is causing" or "is likely to cause" immediate and serious injury to a client or to the public. The attorneys petitioned the Bar for dissolution of the interim suspensions; the Bar denied their petitions, and they appealed that denial to this Court on August 8, 1996. At that same time, the attorneys filed with this Court motions to expedite their appeals, or in the alternative, to stay their interim suspensions. On August 22, 1996, this Court denied the attorneys' motions to expedite, but granted their motions to stay their interim suspensions pending the appeal of the denial of their petition for dissolution.
In preparing to answer the Bar's formal charges filed against him and the other attorneys, Hayes made discovery requests seeking from the Bar information about the Bar's allegations against him.[2] However, the Bar, on October 8, 1996, filed a motion to stay the attorneys' disciplinary cases pending the trial of the criminal cases.
On October 28, 1996, the Bar filed a motion with the Disciplinary Board of the Bar to stay the discovery in the attorneys' disciplinary case pending the trial of the criminal cases. This motion was granted, without a hearing.
*789 On February 14, 1997, following three weeks of trial in the criminal cases against the attorneys, Roden and Hayes pleaded guilty to four misdemeanor charges; one involved the offense of obtaining a signature by deception; another involved making a contribution in the name of another person, in violation of the Alabama Fair Campaign Practices Act; another involved misapplication of property; and another involved falsifying business records. Carter pleaded guilty to two misdemeanor charges; one involved the offense of obtaining a signature by deception, and the other involved making a contribution in the name of another person, in violation of the Alabama Fair Campaign Practices Act.
Thereafter, on March 7, 1997, the Bar, pursuant to Rule 22(a)(2), Ala.R.Disc.P., filed with the Disciplinary Board of the Bar a "Petition for the Determination of Serious Crimes," asking the Board to determine and declare that the misdemeanors to which the attorneys had pleaded guilty in their criminal cases constituted "serious crimes" within the meaning of that term as it is used in the Rules of Disciplinary Procedure. The attorneys, in opposition, requested an opportunity to present evidence as well as to orally argue and brief the law on the issues argued by the Bar in its petition. The attorneys were not permitted an opportunity to be heard, and 13 days later, on March 20, 1997, the Disciplinary Board of the Bar entered an order denying the attorneys the opportunity to present evidence or oral argument in their behalf. In that same order, the Disciplinary Board granted the Bar's petition, finding that the offenses to which the attorneys had pleaded guilty in their criminal cases are "serious crimes" within the meaning of Rule 8(c)(2), Ala.R. Disc.P.
On April 16, 1997, the Bar, in accordance with the Disciplinary Board's determination that the attorneys had committed "serious crimes," filed with the Disciplinary Commission of the Bar a new "Petition for Interim Suspension" of the attorneys. The Disciplinary Commission granted that petition. Thereafter, on or about June 17, 1997, a hearing was held before the Disciplinary Commission to determine the final discipline to be imposed on the attorneys under Rule 22, Ala.R. Disc.P, for the "serious crimes" the Disciplinary Board had determined that they had committed.
Pursuant to the Bar's petition filed on March 7, 1997, the Disciplinary Commission entered an "Order of Final Discipline" on June 26, 1997. That order suspended Roden and Hayes from the practice of law for two years and suspended Carter for 247 days, for having committed "serious crimes" as evidenced by their pleas to the charges in their criminal cases.[3]
On July 29, 1997, the attorneys filed "Motions to Dismiss Remaining Charges" with the Disciplinary Board of the Bar. On August 13, 1997, without a hearing, the Disciplinary Board denied those motions.
The attorneys appeal from the Bar's discipline order, arguing that the Bar denied them due process in the handling of the disciplinary cases stemming from their pleas of guilty in the criminal cases. They also seek a writ of mandamus ordering the dismissal of the formal charges that have remained pending against them.
The attorneys assert that their constitutional rights to due process were violated by the Bar's failure to hold a hearing on whether the crimes they pleaded guilty to in the criminal cases constituted "serious crimes" under Rule 8, Ala.R.Disc.P. In opposition, the Bar contends that the attorneys' rights were not violated, because they were afforded an opportunity to be heard by the Disciplinary Commission when it was determining the sanctions to be imposed for their "serious crimes." Moreover, the Bar argues that under Rule 22, Ala.R.Disc.P., it is within the discretion of the Disciplinary Board to hold a hearing on whether a lawyer's conduct involves a "serious crime." In support of this contention, the Bar, during its oral argument before this Court, cited the language of Rule 22; that rule reads, in pertinent part:
Rule 8(c)(2) provides:
The plain, express wording of Rule 22, Ala.R.Disc.P., taken in conjunction with the plain wording of Rule 8(c)(2), makes it clear to this Court that once the Disciplinary Board has determined that an attorney has committed a felony or a "serious crime," a disbarment or a suspension of the attorney's right to practice law is mandatory.
This Court has consistently held that "[t]he right to practice law in this state is constitutionally protected as a valuable property right, and no lawyer can be deprived of that right except by due process of law and upon the presentation of clear and convincing evidence of misconduct." Huckaby v. Alabama State Bar, 631 So. 2d 855, 857 (Ala.1993), citing Worley v. Alabama State Bar, 572 So. 2d 1239 (Ala.1990). Due Process mandates notice and an opportunity to be heard at a meaningful time and in a meaningful way. U.S. Const., Amend. 5 and Amend. 14. We are of the opinion that a hearing not based on the veracity of the underlying charges, but merely on the ultimate punishment imposed on the underlying charge, is not a meaningful one. Accordingly, we conclude that the Bar, in failing to afford these attorneys a meaningful opportunity to be heard on the issue whether the crimes to which they had pleaded guilty constituted "serious crimes" for the purposes of Rule 22, Ala.R. Disc.P., violated their constitutional right to due process. However, we recognize that as of today, Carter's 247-day suspension will have been served and Roden and Hayes will have served almost half of their suspensions. Therefore, although we reverse the discipline order, on remand the attorneys shall be allowed this option: 1) To petition the bar for a hearing on the issue whether the crimes to which they pleaded guilty were "serious crimes," for the purposes of Rule 22, Ala.R.Disc.P., and if they so petition, then the Bar is to grant the petition and proceed in a manner consistent with this opinion; or 2) to petition the Bar to have the discipline order reinstated, with credit for the time of suspension served as of the reinstatement. The attorneys shall exercise this option within 21 days of the date of this Court's certificate of judgment in these cases; if they do not exercise the option within that period, then the Bar either shall proceed as if the attorneys had exercised option one or shall proceed in some other manner consistent with this opinion.
The attorneys, citing Noojin v. Alabama State Bar, 577 So. 2d 420 (Ala.1990), contend that the Bar has inordinately delayed proceedings relating to the May 1996 charges and has thereby violated Rule 14, Ala. R.Disc.P. That rule provides:
*791 In Noojin, this Court examined an attorney's contentions that the Alabama State Bar had erred in delaying disciplinary proceedings against him. It held that the culmination of a federal criminal matter was not "good cause" for delaying disciplinary proceedings for nearly a year, and it barred the Alabama State Bar from proceeding on the charges pending against the attorney. As in Noojin, we consider in the present case whether the Bar had "good cause" to defer or delay the disciplinary proceedings against the attorneys. Rule 14, Ala.R.Disc.P.[4] The Bar asserts that it "stayed" the proceedings on the formal charges based on the attorneys' alleged attempts to obtain discovery for their criminal cases. Aside from this assertion, the Bar has not attempted to provide a reason for its continued delay in regard to the formal charges against the attorneys.[5] Therefore, if we accept the Bar's only explanation of "good cause" for delay, there remains a period of over a year, from February 14, 1997, to now, during which the Bar has taken no action to proceed on the merits of the formal charges. Under our Noojin analysis, we find that this delay in proceeding on the remaining formal charges is excessive. Therefore, because of the inordinate delay on the part of the Bar in pursuing the remaining formal charges against the attorneys, those charges are dismissed.
DISCIPLINE ORDER REVERSED AND CASES BASED ON THAT ORDER REMANDED, WITH INSTRUCTIONS; PENDING CHARGES DISMISSED.
ALMON, SHORES, KENNEDY, COOK, and LYONS, JJ., concur.
HOOPER, C.J., and SEE, J., concur in the result.
HOUSTON, J., concurs in part and dissents in part.
MADDOX, J., dissents.
SEE, Justice (concurring in the result).
I concur in the result of the majority opinion. All persons, even the most guilty felons, must be afforded due process of law before they are deprived of a valuable property interest.[6]Connecticut v. Doehr, 501 U.S. 1, 9, 111 S. Ct. 2105, 115 L. Ed. 2d 1 (1991) (noting that due process protections include notice, a neutral decision-maker, and some form of hearing). The appropriate extent of procedural protections required by due process, including the scope of a hearing, are determined by balancing the interest of the affected individual that is at stake, the risk of an erroneous deprivation, and the governmental burdens entailed in providing additional procedural protections. Mathews v. Eldridge, 424 U.S. 319, 335, 96 S. Ct. 893, 47 L. Ed. 2d 18 (1976).
In this civil case, I agree with the State Bar that a full hearing, including the opportunity to present evidence and to orally argue the case, was not necessarily required with respect to those disciplinary charges based on the misdemeanor counts to which the defendants had previously pleaded guilty. The Bar submitted to the Disciplinary Board documentary evidence of the defendants' voluntarily entered guilty pleas, and only a legal issue remainedwhether the misdemeanors to which the defendants had pleaded guilty were "serious crimes" under the Rules of Disciplinary Procedure. See Rule 22(a)(2), Ala. R. Disc. P. ("The record of his or her conviction or a copy thereof certified and authenticated in the manner authorized by law is conclusive evidence of such conviction.... The Disciplinary Board may conduct a hearing to assist it in making [the *792 serious-crime] determination.") (emphasis added); see, e.g., Firman v. Department of State, State Bd. of Medicine, 697 A.2d 291 (Pa.Commw.Ct.1997) (holding that review of guilty plea documents, petition by state, and defendant's answer, without oral argument at a formal hearing, constituted sufficient due process for suspending a registered nurse from her practice based on a prior criminal conviction).
However, the Disciplinary Board ruled that the misdemeanors were serious crimes just 12 days after the Bar filed its "Petition for Determination of Serious Crimes" and before the defendants had a full opportunity to file an answer. See Rule 3(b), Ala. R. Disc. P. (applying Alabama Rules of Civil Procedure to disciplinary proceedings); Rule 12(a), Ala. R. Civ. P. (providing defendants 30 days to answer a complaint). The determination that the misdemeanors were serious crimes required mandatory suspension or disbarment, thus implicating a constitutionally protected property interest. See Ala. R. Disc. P. 22(a) ("The Disciplinary Commission shall disbar or suspend a lawyer ... (2) [i]f the lawyer's conviction for a `serious crime'... has become final...."); Huckaby v. Alabama State Bar, 631 So. 2d 855, 857 (Ala. 1993) (stating that the right to practice law in Alabama is "constitutionally protected as a valuable property right"). By failing to afford the defendants a full opportunity to answer the Bar's petition, the Disciplinary Board deprived the defendants of a valuable property interest without due process of law.
With respect to the remaining formal charges that did not relate to the defendants' guilty pleas, it was incumbent on the Bar to show good cause for delaying its prosecution of the remaining charges. See Rule 14, Ala. R. Disc. P.; Noojin v. Alabama State Bar, 577 So. 2d 420 (Ala.1990). After the defendants filed guilty pleas to the misdemeanors, the Bar suspended them on the disciplinary charges that related to those crimes; however, the Bar delayed for more than a year in prosecuting the remaining disciplinary charges. The final resolution on appeal of the disciplinary charges related to the defendants' misdemeanor convictions was not a prerequisite necessary to the prosecution of the remaining charges. Further, the Bar has not offered in its brief or at oral argument sufficient justification for its delay in prosecuting the remaining charges. See Noojin, 577 So. 2d at 423-25. Consequently, the dismissal of the remaining charges is proper.[7]
HOOPER, C.J., concurs.
HOUSTON, Justice (concurring in part and dissenting in part).
The Alabama Rules of Disciplinary Procedure were promulgated by this Court. If these rules deny due process to lawyers, it is the fault of this Court, not of any agency, commission, or board of the Alabama State Bar. This Court undertook to define a lesser-than-felony "serious crime" in Rule 8(c)(2)(B) and (C), as a crime "involving moral turpitude" or a crime involving "interference with the administration of justice, false swearing, misrepresentation, fraud, extortion, misappropriation, or theft."
Upon petition by general counsel for the State Bar, the Disciplinary Board, acting in accordance with this Court's Rule 22, Ala. R.Disc.P., decided that the three lawyers' conduct involved "serious crime[s]." Because obtaining a signature by deception is one of the crimes that all three of the lawyers pleaded guilty to, it is immaterial whether making a contribution to another person in violation of the Alabama Fair Campaign Practices Act, or falsifying business records, or misapplication of property also would constitute a "serious crime." Is obtaining a signature by deception a serious crime as defined by this Court in Rule 8(c)(2)? Certainly it is!
I must assume that the lawyers were afforded due process in the proceeding in which they pleaded guilty to obtaining a signature *793 by deception. Nothing in this record indicates that they were not. I must conclude that in promulgating the Alabama Rules of Disciplinary Procedure this Court decided that lawyers who found themselves in the situation we have in these cases now before us would have received all the process they were due. Neither the Disciplinary Commission, in following the Alabama Rules of Disciplinary Procedure, nor this Court, in promulgating those Rules, denied the lawyers due process.
MADDOX, Justice (dissenting).
I agree with Justice Houston that the lawyers were not denied due process by the Bar's not holding a hearing to determine whether the misdemeanors they had pleaded guilty to were "serious crimes." I write separately to state that I disagree with the majority's dismissal of the Alabama State Bar's charges now pending against the lawyers. I believe the Bar should at least be afforded an opportunity to explain the reasons for the delay and to address whether the principles of law applied in Noojin v. Alabama State Bar, 577 So. 2d 420 (Ala.1990), should apply in this case.
[1] The indictment against Roden consisted of 10 counts that alleged theft of property I, a felony in violation of Ala.Code 1975, § 13A-8-3; two counts that alleged theft of property II, a felony in violation of Ala.Code 1975, § 13A-8-4; and two counts that alleged Roden had possession of a forged instrument in violation of Ala.Code 1975, § 13A-8-6. The indictment against Hayes consisted of five counts that alleged theft of property I, one count that alleged theft of property II, and one count that alleged intimidating a witness in violation of Ala.Code 1975, § 13A-10-124. The indictment against Carter consisted of five counts that alleged theft of property I, one count that alleged theft of property II, and one count that alleged intimidating a witness.
[2] Hayes served interrogatories on the Bar and requested a subpoena pursuant to Rule 17(a), Ala.R.Disc.P., to require Poff to appear and give oral and video deposition on matters directly related to the complaint he had filed and the formal charges brought by the Bar. On September 26, 1996, pursuant to the request by Hayes, the Bar issued a subpoena directed to Richard Poff for an oral and videotape deposition. However, at the deposition, lawyers from the Bar's Office of General Counsel objected to the deposition, alleging that no notice was given to the Bar about the deposition being videotaped, despite the fact that the Bar specifically issued the subpoena for an oral and videotaped deposition. Although Robert Brodgen, chairman of the Bar's Disciplinary Board, had stated in a prior hearing that the disciplinary hearings would not be stayed pending the outcome of the criminal cases, which were proceeding concurrently with the Bar's disciplinary proceedings, the assistant general counsel for the Bar made accusations that the deposition was being taken in a bad faith attempt to obtain discovery for the criminal cases and terminated the deposition.
[3] Roden, Hayes, and Carter were given credit for time served under their interim suspensions.
[4] This Court's Noojin opinion dealt with Rule 11, Alabama Rules of Disciplinary Enforcement. That Rule 11, Ala.R.Disc.Enf., read substantially the same as Rule 14, Ala.R.Disc.P.
[5] At oral argument before this Court, in response to questions regarding the Bar's continued delay in proceeding on the remaining formal charges, general counsel for the Bar stated that the Bar had stayed those disciplinary matters pending the outcome of the criminal cases against the attorneys, and that those charges were "pending," but he offered no further explanation for the delay.
[6] The federal Due Process Clause provides:
"No State shall ... deprive any person of life, liberty, or property, without due process of law...."
U.S. Const. amend. XIV § 1.
[7] I am especially concerned that the Rules of Disciplinary Procedure do not preclude the possibility of the serial prosecution of related disciplinary charges that result in cumulative suspensions. See Noojin v. Alabama State Bar, 577 So. 2d 420 (Ala.1990) (reversing order suspending a lawyer where the Bar did not prosecute state disciplinary charges until a one-year suspension by a federal court, based on related activity, had almost expired). | 5286209c06ad7a4d18dd77a9770252c82a0760812a728ab5df09dbf789caa0de | 1998-06-19 00:00:00 |
3bd17cc6-6a3f-470f-abfd-731c3a419e32 | Green Tree Agency, Inc. v. White | 719 So. 2d 1179 | 1962094, 1962095 | Alabama | Alabama Supreme Court | 719 So. 2d 1179 (1998)
GREEN TREE AGENCY, INC., and Green Tree Financial Corporation
v.
Karen WHITE.
OXFORD HOUSING, INC., et al.
v.
Karen WHITE.
1962094, 1962095.
Supreme Court of Alabama.
June 5, 1998.
Rehearing Denied July 17, 1998.
Ronald G. Davenport and William H. Webster of Rushton, Stakely, Johnston & Garrett, P.A., Montgomery, for appellants Green Tree Agency and Green Tree Financial Corporation.
James E. Williams and Flynn Mozingo of Melton, Espy, Williams & Hayes, P.C., Montgomery, for appellants Oxford Housing, Inc., Eric Barker, and Wayne Barker.
R.M. Woodrow of Doster & Woodrow, Anniston, for appellees.
MADDOX, Justice.
Karen White purchased a mobile home from Oxford Housing, Inc. As part of the purchase, White and Oxford Housing entered into an installment contract and a security agreement whereby White financed the purchase of the mobile home and pledged the home as security. The contract, which contained an arbitration clause, was signed by White and by Eric Barker, an agent of Oxford Housing. The installment contract named Green Tree Financial Corporation as the assignee.
White later sued Green Tree Agency, Inc. (a subsidiary of Green Tree Financial Corporation), Green Tree Financial Corporation, Oxford Housing, Inc., Eric Barker, and Wayne Barker[1] (collectively the "defendants"), alleging fraud, negligence and/or *1180 wantonness, deceit, outrage, and breach of fiduciary duty.
The defendants moved to compel arbitration, and the trial court granted their motion. White filed a motion to "reconsider" the arbitration order. After filing this motion, White amended her complaint to allege that the defendants had fraudulently suppressed the fact that the contract contained an arbitration clause. The trial court directed White to make a more definite statement of her claim and stated that if she did not make a more definite statement it would deny her motion to reconsider. White filed another amended complaint that included a more definite statement; that statement alleged that she had been fraudulently induced to purchase the mobile home, in part, by the defendants' failure to disclose to her that the contract "contained language [by which] Plaintiff had waived her right to trial by jury [and that allowed the defendants] to compel Plaintiff to submit to arbitration while allowing Defendants to sue Plaintiff." The trial court set aside its order compelling arbitration. The defendants appealed.
The issue here is whether the arbitration clause is enforceable when White claims she was fraudulently induced into signing the contract that contains the clause. For the reasons discussed below, we hold that the arbitration clause is enforceable.
White claims that she was fraudulently induced into signing the contract because, she says, the defendants did not inform her that it contained an arbitration clause. On the front of the contract, the following statements appear: "NOTICE: SEE OTHER SIDE FOR ADDITIONAL TERMS AND CONDITIONS OF THIS CONTRACT" and "CAUTIONIT IS IMPORTANT THAT YOU THOROUGHLY READ THE CONTRACT BEFORE YOU SIGN IT." The back of the contract contained the arbitration clause. White does not claim that any representation was made to her regarding the arbitration clause. She merely contends that no one told her that it was included in the contract.
In Wilson v. Brown, 496 So. 2d 756, 759 (Ala.1986), this Court stated, "Silence is not actionable fraud absent a confidential relationship or some special circumstance imposing a duty to disclose." See also Cooper & Co. v. Bryant, 440 So. 2d 1016 (Ala.1983). We do not believe the defendants had a fiduciary duty to disclose the presence of the arbitration clause. The statement on the front alerted White that she should read the entire contract. "[O]rdinarily when a competent adult, having the ability to read and understand an instrument, signs a contract, he will be held to be on notice of all the provisions contained in that contract and will be bound thereby." Power Equipment Co. v. First Alabama Bank, 585 So. 2d 1291, 1296 (Ala.1991).
White also claims that she was fraudulently induced into signing the contract by certain representations concerning certain terms and conditions of the installment contract. If an arbitration clause is broad enough to encompass claims of fraud in the inducement, then those claims are subject to arbitration. See Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 U.S. 395, 87 S. Ct. 1801, 18 L. Ed. 2d 1270 (1967). The arbitration clause in White's contract reads, in part:
This arbitration clause is broad enough to encompass White's claims of fraud in the inducement; therefore, those claims are subject to arbitration.
The trial court's order setting aside its order compelling arbitration is reversed.
REVERSED AND REMANDED.
HOOPER, C.J., and HOUSTON, SEE, and LYONS, JJ., concur.
ALMON, SHORES, KENNEDY, and COOK, JJ., dissent.
KENNEDY, Justice (dissenting).
A majority of this Court has voted to enforce an arbitration clause that, while *1181 maintaining the Green Tree defendants' right to seek judicial redress of claims they may have against White, prohibits White from litigating her claims against them. Although I recognize that Alabamians have a right to enter into contracts freely, I also recognize that this Court has limited that right when the contract is adverse to the best interests of the general population. Because under this arbitration clause there is no mutuality of remedy, I conclude that the trial court properly set aside its order compelling arbitration of White's claims.
[1] The record is unclear whether Wayne Barker is an agent, an employee, or an owner of Oxford Housing, Inc. | 27c6e342787181ae7e52e48da44b9f3718b35b190b0e21a30eeee0818c78b733 | 1998-06-05 00:00:00 |
4d0073bd-d22d-432e-8f09-93af305c0e72 | Brooks v. Hill | 717 So. 2d 759 | 1951926 | Alabama | Alabama Supreme Court | 717 So. 2d 759 (1998)
Dorothy Hill BROOKS, individually and as executrix of the last will and testament of Raymond E. Brooks, deceased
v.
Leroy HILL; Hill & Brooks Coffee Company, Inc., a corporation; et al.
1951926.
Supreme Court of Alabama.
June 12, 1998.
*760 Mack B. Binion of Briskman & Binion, P.C., Mobile; and Charles L. Miller, Jr., Mobile, for appellant.
A. Danner Frazer, Jr., and Michael E. Upchurch of Frazer, Greene, Upchurch & Baker, L.L.C., Mobile, for appellees.
SHORES, Justice.
The plaintiff, Dorothy Hill Brooks, individually and as executrix of the last will and testament of her deceased husband, Raymond E. Brooks, appeals from the dismissal of her amended complaint. That amended complaint alleged that Leroy Hill, the majority shareholder, president, and chairman of the board of directors of Hill & Brooks Coffee Company, Inc. ("H & B" or "the corporation"), had wasted corporate assets and, either acting alone or by conspiring with fictitious defendants, had "perpetrated a scheme to devalue" stock in H & B with the intent to purchase it. We affirm.
Raymond E. Brooks (the "decedent") owned a 19% interest in H & B, a closely held corporation. Leroy Hill, the plaintiff's brother, owned the remaining interest. On June 11, 1993, Hill presented the decedent with a proposal to purchase his interest in H & B for the sum of $1,196,753.00, payable over 10 years with interest at 8% per year. On that date, the decedent and Hill executed a written sales agreement containing those terms. Raymond E. Brooks died on October 26, 1994, and his widow was appointed executrix of his estate.
In June 1995, the widow filed a one-count complaint alleging that her brother (Hill) and H & B, aided and abetted by fictitious defendants, had perpetrated a fraud upon the decedent in connection with the purchase of his stock. That complaint stated in pertinent part:
The widow sought to recover compensatory and punitive damages, contending that the decedent had relied to his detriment on Hill's representation by selling his interest in H & B on June 11, 1993, at a price below its actual value.
The widow subsequently amended her complaint to include three additional counts. The first count set out in the amended complaint, designated as "count two," reads in pertinent part:
In counts three and four of the amended complaint, the plaintiff adopts the factual allegations underlying her claims in counts one and two. Count three reads in pertinent part:
Count four asserts almost identical wrongdoing, except that it alleges the existence of a conspiracy:
Under counts three and four, the widow demanded damages "to adequately compensate for the fair value of the stock of the decedent, Brooks, as well as punitive and exemplary damages."
As to the widow's fraud claim in the original complaint, the defendants filed a motion for judgment on the pleadings; the defendants subsequently filed a motion to dismiss the amended complaint. The trial court granted both motions. It held that count one, stated in the original complaint, stated a claim for a fraud perpetrated upon the decedent and that such a claim abated upon his death. The widow does not appeal as to count one. In dismissing the amended complaint, the trial court held that the plaintiff lacked standing to pursue the breach-of-fiduciary-duty *762 claim stated in count two, and that counts three and four stated claims in the nature of fraud claims and those claims, like the claim stated in count one, had abated upon the decedent's death. The widow appeals the dismissal of the counts of her amended complaint.
The widow argues that she could recover damages, either individually or as the executrix of her decedent's estate, pursuant to her claim in count two against Hill alleging breach of fiduciary duty. We disagree. Count two charges that Hill breached a fiduciary duty "by using the assets of the corporation to benefit his personal interests" and that "[a]s a proximate result of [Hill's] waste of corporate assets, Plaintiff was damaged in that the value of Brooks' stock was substantially reduced in value." It is undisputed that the plaintiff never owned any interest in H & B, and, therefore, that Hill owed her no fiduciary duty in her individual capacity. The plaintiff likewise cannot maintain an action to recover directly in her capacity as executrix of the decedent's estate because, even if he were still alive, the decedent could not have recovered on his own behalf for the wrongdoing alleged in count two. This Court has previously held that an allegation of waste of corporate assets does not permit a minority stockholder to recover on his own behalf; rather, such wrongdoing gives rise only to a derivative claim, which must be brought on behalf of the corporation: "The waste of corporate assets by majority stockholders is primarily an injury to the corporation itself. The injury to minority stockholders is secondary." Galbreath v. Scott, 433 So. 2d 454, 457 (Ala.1983). See also Stallworth v. AmSouth Bank of Alabama, 709 So. 2d 458 (Ala.1997); Pegram v. Hebding, 667 So. 2d 696 (Ala.1995); Shelton v. Thompson, 544 So. 2d 845 (Ala.1989). Accordingly, assuming the plaintiff could bring a claim based on Hill's waste of H & B assets, that claim could have been brought only as a derivative claim on behalf of the corporation; the plaintiff did not bring such a claim. The trial court properly dismissed count two of the amended complaint.
The widow also argues that the trial court erred in dismissing counts three and four of her amended complaint. She contends that the trial court mistakenly construed her allegations of a "scheme to devalue [the decedent's] stock with the intent to purchase it" to be in the nature of fraud claims, which would abate upon the decedent's death. Rather, the plaintiff seems to assert, these allegations state claims of a violation of the provisions of § 10-2B-8.32, Ala.Code 1975, and minority shareholder "oppression" or "squeeze-out." She characterizes these claims as sounding in contract, and, therefore, she reasons, they survived in her favor as the decedent's personal representative.
Section 10-2B-8.32, Ala.Code 1975, provides in pertinent part:
In Fulton v. Callahan, 621 So. 2d 1235, 1245 (Ala.1993), this Court recognized that a shareholder could recover damages on his own behalf for a violation of the statutory provision quoted above, which was then codified at § 10-2A-71, Ala.Code 1975, notwithstanding that it does not expressly provide for a civil remedy. Previously, in Belcher v. Birmingham Trust Nat'l Bank, 348 F. Supp. 61, 147 (N.D.Ala.1968), stay denied, 395 F.2d *763 685 (5th Cir.1968), a federal district court had held that Tit. 10, § 21(63), Ala.Code 1940, a criminal statute with language similar to § 10-2A-71, implied an independent civil cause of action. See Fulton, at 1246. Following the Belcher court, we delineated in Fulton the elements of a claim based on a violation of § 10-2A-71:
Fulton at 1245-46, citing Belcher, supra, at 147.
The widow argues that, through her allegations (1) that Hill made representations to the decedent that understated the value of H & B stock, (2) that he wasted corporate assets, and (3) that he committed these acts with the intent to purchase the decedent's stock at below its "real value," she has stated a cause of action for "devaluation with intent to purchase," under the terms of § 10-2B-8.32 and our decision in Fulton, supra. It is undisputed, however, that any such claim belonged to the decedent rather than the plaintiff personally. Thus, assuming that she has pleaded sufficient facts to state a claim under § 10-2B-8.32, we still must consider whether that claim would survive the death of the plaintiff's decedent.
Under the Alabama survival statute, § 6-5-462, Ala.Code 1975, an unfiled claim sounding in tort will not survive the death of the person with the claim, Malcolm v. King, 686 So. 2d 231 (Ala.1996); Georgia Cas. & Sur. Co. v. White, 582 So. 2d 487 (Ala.1991). A claim on a contract, on the other hand, survives in favor of a decedent's personal representative, regardless of whether the decedent had filed an action before his death, McCulley v. SouthTrust Bank of Baldwin County, 575 So. 2d 1106 (Ala.1991); Benefield v. Aquaslide `N' Dive Corp., 406 So. 2d 873 (Ala.1981). Therefore, because any claim stated under § 10-2B-8.32 belonged to the decedent and he did not file an action prior to his death, such a claim survives in the plaintiff's favor as the decedent's representative generally if the claim arises out of a contract ("ex contractu"), rather than out of a tort ("ex delicto").
In Jefferson County v. Reach, 368 So. 2d 250, 252 (Ala.1978), this Court explained:
(Citations omitted.) Further, where the parties have entered into a contract, if the cause of action arises from a breach of duty arising out of the contract, rather than from a breach of a promise of the contract itself, the claim is ex delicto. See, e.g., Lemmond v. Sewell, 473 So. 2d 1047, 1049 (Ala.1985) (holding that the plaintiff could not maintain a contract claim based upon a physician's failure to use due care because "[t]he law implies a duty on the part of a physician to exercise due care; it does not imply a promise on his part to do so"); Sanford v. Western Life Ins. Co., 368 So. 2d 260, 263 (Ala.1979) (holding that the plaintiff's claims alleging fraud and bad faith were not claims "on a contract" for survival purposes; the insurance contract between the parties "merely establishes the relationship from which ... a legally imposed duty could spring," "whether that duty be of good faith, fair dealing or honest disclosure").
This Court has not specifically held whether the independent cause of action for a violation of the provisions of § 10-2B-8.32 sounds in contract or sounds in tort.[2] In *764 Fulton v. Callahan, we said of a claim alleging a violation of the provisions now codified at § 10-2B-8.32:
621 So. 2d at 1246-47 (emphasis added) (citation omitted). Thus, while we have characterized a § 10-2B-8.32 claim as one based on a breach of fiduciary duty by a corporate officer or director, the widow argues that a claim alleging breach of fiduciary duty by a corporate officer sounds in contract.
She argues that corporation law is essentially a form of contract law and that the breach of fiduciary duty by a director or officer should be viewed as a breach of an implied contract. There are contractual aspects present in the formation of corporations and partnerships. However, the fiduciary duties of loyalty and care owed by corporate managers, see Massey v. Disc Mfg., Inc., 601 So. 2d 449 (Ala.1992), are imposed by law by virtue of a corporate manager's relationship to the corporation and its stockholders, even if it might be said that contractual agreement gives rise to that relationship. Further, the six-year statute of limitations is applicable to "[a]ctions upon any simple contract," § 6-2-34(9), Ala.Code 1975; Romar Development Co. v. Gulf View Management Corp., 644 So. 2d 462 (Ala.1994). However, this Court has previously held that a claim alleging breach of fiduciary duty is governed by the two-year limitations period of § 6-2-38(l), Ala.Code 1975, which controls "[a]ll actions for any injury to the person or rights of another not arising from contract and not specifically enumerated in [the other provisions of § 6-2-38]." (Emphasis added.) See Travis v. Ziter, 681 So. 2d 1348, 1350 n. 1 (Ala.1996); see also System Dynamics Int'l, Inc. v. Boykin, 683 So. 2d 419 (Ala.1996); Davis v. Brown, 513 So. 2d 1001 (Ala.1987); Faith, Hope & Love, Inc. v. First Alabama Bank of Talladega County, N.A., 496 So. 2d 708 (Ala.1986). A claim based on an alleged breach of the fiduciary duty owed by corporate officers under § 10-2B-8.32 sounds in tort. Thus, the claim stated by the widow in this case did not survive the decedent's death.
The widow also argues that her complaint states a claim of minority shareholder "oppression" or "squeeze-out," a cause of action recognized by this Court in Burt v. Burt Boiler Works, Inc., 360 So. 2d 327 (Ala.1978). In that case, we recognized that majority stockholders of a closely held corporation "owe a duty to at least act fairly to the minority interests, and [that] the majority cannot avoid that duty merely because the action taken is legally authorized." Id. at 331. In rejecting the view that "a majority may always regulate and control the lawful exercise of corporate powers," the Court, quoting O'Neal, Close Corporations, § 8.07, explained, "`Where several owners carry on an enterprise together (as they usually do in a close corporation), their relationship should be considered a fiduciary one similar to the relationship among partners. The fact that the enterprise is incorporated should not substantially change the picture.'" 360 So. 2d at 331-32. We concluded, therefore, that should majority shareholders in a close corporation use their right of control to "deprive the minority of their just share of the *765 corporate gains, such would, of course, be actionable." Id. at 332.
In several subsequent cases we have reaffirmed the viability of the squeeze-out cause of action. See Stallworth v. Am-South Bank, supra; Michaud v. Morris, 603 So. 2d 886 (Ala.1992); Ex parte Brown, 562 So. 2d 485 (Ala.1990); Galbreath v. Scott, supra. We do so again here and confirm the general proposition that minority shareholders in a close corporation have "a right to fairness by the majority," Michaud, supra, at 888. We have recently acknowledged that "the squeeze-out cause of action is not a panacea for any and all conduct undertaken by majority shareholders of a close corporation that could be deemed `unfair' to the minority." Stallworth, supra, 709 So. 2d at 467. Rather, the underpinnings of the squeeze-out cause of action demonstrate that it is meant to be a remedy for a more specific type of unfairness that may arise from the hybrid nature of close corporations. As we recently explained,
Stallworth, supra, 709 So. 2d at 467. In forming a close corporation, the shareholders themselves naturally often view their relationship as akin to that of partners, who will each share equitably in the income derived from the enterprise. However, the corporate form that governs their legal relationship assigns control of the corporation to the majority,[3] who, by virtue of that power, would be able to frustrate the minority's "basic expectation[] ... to share proportionally in corporate gains," Michaud v. Morris, supra, at 888, by excluding the minority from salaried employment as officers, directors, or employees; refusing to declare dividends; and eliminating other privileges that might flow to the minority from the corporation.
Further, because of the minority shareholder's prospect of being cut off from corporate income and privileges, the plight of a minority shareholder in a close corporation, as distinguished from both a partner in a partnership and a minority shareholder in a publicly traded corporation, is unique. Traditionally, a partner who believed he had been deprived of profits due him had the power to obtain a dissolution, an accounting, and a settlement. See, e.g., Jebeles v. Costellos, 391 So. 2d 1024 (Ala.1980); Jones v. Styles, 268 Ala. 595, 109 So. 2d 713 (1959). Similar remedies are available under the Alabama Uniform Partnership Act, §§ 10-8A-101 et seq., Ala.Code 1975; see §§ 10-8A-405, -601, -602, -701, -801, -807. However, a shareholder in a corporation, whether close or public, ordinarily lacks the power to unilaterally withdraw, see 18 C.J.S. Corporations § 310 (1990), or to force a dissolution. Cf. Levine v. Beem, 608 So. 2d 373 (Ala.1992) (holding that dissolution of a corporation is an extreme remedy and should be ordered only if the facts clearly warrant it); Johnston v. Livingston Nursing Home, Inc., 282 Ala. 309, 211 So. 2d 151 (1968) (alleged mismanagement and quarrels between stockholder sisters of close corporation did not justify the appointment of a receiver and dissolution of the corporation). This is not especially problematic for a minority shareholder of a public corporation because the only benefits he would normally expect to receive by virtue of his stock ownership would come through dividend distribution and an increase in share value recognized upon a sale, which is obtainable with relative ease and efficiency through the operation of the national securities market. See generally Charles R. O'Kelley, Jr., and Robert B. Thompson, Corporation and Other Business Associations; Cases and Materials 156-75 (1992). In contrast, the reasonable expectations of a minority shareholder of a close corporation may include greater direct participation in the affairs of *766 the corporation. See Stallworth, Michaud, supra. In addition, if the minority shareholder of the close corporation desires to leave the enterprise, his shares often "cannot, as a practical matter, be sold," Galbreath, 433 So. 2d at 457. This is so because the close corporation's shares are not publicly traded and third parties may be reluctant to assume the vulnerable position of the minority shareholder by purchasing his interest; thus, the only market available for such shares may be the "squeezing" majority shareholders, who often would have almost no incentive to purchase the minority's shares at fair value because the majority might already be using the minority's capital without distributing income earned thereon. Thus, no matter how "oppressive" or "unfair" it might have seemed for it to do so, the majority, as long as its actions were otherwise legally authorized, could use its right of control to put the minority shareholder into a situation where he had only two, equally unappealing, options: "(1) hold his stock in perpetuity while receiving no earnings thereon, or (2) sell out at an unreasonably low price to the majority shareholder." Andrew P. Campbell, Litigating Minority Shareholder Rights and the New Tort of Oppression, 53 Ala. Law. 108 (1992).
It is toward remedying this more specific kind of unfairness, whereby the majority of the shareholders in a close corporation is able to use its right of control to exert pressure upon, i.e., to "squeeze," the minority by reducing or eliminating its income, coupled with the minority's practical inability to withdraw, that the squeeze-out cause of action is rightfully directed. It does not permit a minority shareholder to recover personally for officer or director wrongdoing where the primary injury is to the corporation itself. A shareholder has always had a remedy for such malfeasance: a derivative action brought on behalf of the corporation, which is the real party in interest. See Part I, ante; Stallworth, Galbreath, supra. The fact that a corporation is closely held does not transform injuries to the corporation that harm stockholders only derivatively into injuries to the shareholders personally for which they might recover directly.
The widow maintains that her complaint should not have been dismissed, because, she seems to argue, it states a claim of squeeze-out. Her brief is somewhat unclear on this point in that it does not seem to distinguish between the "squeeze-out" cause of action recognized in Burt v. Burt Boiler Works and the independent cause of action for "devaluation with intent to purchase" recognized in Fulton v. Callahan as a remedy for a violation of the provisions of § 10-2B-8.32, Ala. Code 1975. Admittedly, some of the language employed in Fulton v. Callahan could suggest at least some overlap.[4] However, the two claims are distinct. By the terms of § 10-2B-8.32, the fiduciary duty prohibiting intentional devaluation of stock with intent to purchase applies to the "president, director, or managing officer of any corporation" (emphasis added), and is meant to prevent insider trading and director self-dealing generally, without regard to differences between corporations that are publicly traded and those that are closely held. By contrast, the duty not to "oppress" or "squeeze out" minority shareholders is peculiar to those in control of close corporations and arises primarily because of the recognized differences *767 between close and public corporations that would otherwise allow the majority of a close corporation to exploit its right of control and the minority's inability to withdraw, in order to unfairly deprive the minority of its just share of corporate gains.
For reasons already stated, the widow cannot maintain a cause of action based on a violation of the provisions of § 10-2B-8.32, but we still must determine whether she may pursue a claim based on a squeeze-out that might have been perpetrated upon her decedent. Two members of this Court have previously argued that the squeeze-out cause of action is ex contractu because, they maintain, it is founded principally upon the breach of an express or implied promise that all shareholders of a close corporation will share equitably in corporate gains. See Stallworth v. AmSouth Bank, supra, 709 So. 2d at 469-470 (Maddox, J., dissenting); Fulton v. Callahan, supra, 621 So. 2d at 1254-55 (Houston, J., concurring specially). See also Michael E. DeBowe, "Oppression" of Minority Shareholders: Contract, Not Tort, 54 Ala. Law. 128 (1993). The plaintiff adopts this position, alleging that her decedent was "squeezed out" of H & B and arguing that he had a contract claim that survived his death. The defendants counter by arguing that the claim does not survive because it is based upon the breach of a fiduciary duty that is imposed by law by virtue of the parties' relationships, even if those relationships arise out of a contract. However, the facts alleged by the widow's complaint, even if proven true, do not give rise to such a claim.
The widow alleges that Hill devalued the decedent's stock in H & B by wasting corporate assets and that in making an offer to purchase the decedent's stock Hill misrepresented the actual value of H & B. However, a minority shareholder cannot recover on his own behalf for a director's waste of corporate assets, even in the close corporation context. Stallworth, Galbreath, supra. Thus, Hill's alleged waste of H & B assets cannot be the basis of a squeeze-out claim in the widow's favor. We similarly conclude that Hill's alleged misrepresentation as to the value of H & B does not give rise to a squeeze-out claim. One could certainly deem it "unfair" for a majority shareholder of a close corporation to misrepresent a material fact to a minority shareholder in connection with a purchase of his shares. But while such wrongdoing suggests that a minority shareholder might have been defrauded, it does not suggest that the minority shareholder has also been "squeezed out" of the corporation. The widow has not asserted that her decedent was deprived of his fair share of corporate gains, such as salaried employment, dividends, or other corporate privileges he reasonably might have expected to receive by virtue of his position as a stockholder. Nor has the widow alleged that Hill used his right of control in an attempt to coerce or "squeeze" the decedent into accepting an unreasonably low price for his shares, either by threatening to deprive him of income flowing from the corporation or even by simply "stonewalling" in purchase negotiations in an attempt to take advantage of the practical difficulty the decedent might have had in selling his interest to a third party. Rather, the complaint asserts that Hill simply made a misrepresentation of material fact, upon which the decedent relied to his detriment. The decedent would have had a remedy for such alleged wrongdoing in the form of a fraud cause of action, but such a cause of action would sound in tort and would have abated upon the decedent's death. Miller v. Dobbs Mobile Bay, Inc. 661 So. 2d 203 (Ala.1995). Clearly, however, the duty to refrain from making false representations does not spring from the vulnerability of a minority shareholder in the context of a close corporation.[5] Based on the foregoing, we *768 hold that the widow's complaint does not state a claim of squeeze-out.
The trial court correctly dismissed the amended complaint. The widow could not recover directly for the waste of corporate assets alleged in count two; such harm would give rise to a derivative claim only. Nor can the widow maintain her § 10-2B-8.32 claim for "devaluation with intent to purchase" because, as a claim alleging a breach of fiduciary duty, it sounded in tort and abated upon her decedent's death. Finally, we conclude that the complaint fails to state facts giving rise to a claim based on the squeeze-out of her decedent as a minority shareholder in a close corporation. The judgment of the trial court is hereby affirmed.
AFFIRMED.
ALMON, HOUSTON, KENNEDY, and COOK, JJ., concur.
HOOPER, C.J., and SEE, J., concur in the result.
MADDOX, J., concurs in the result in part and dissents in part.
LYONS, J., recuses himself.
MADDOX, Justice (concurring in the result in part and dissenting in part).
This appeal involves questions concerning the rights of minority shareholders in a close corporation. Specifically, this Court is presented with the question of what kind of claims the plaintiff brought and whether the trial court appropriately applied the law to those claims. Because I disagree with the majority's rationale and most of its conclusions, I respectfully concur in the result in part and dissent in part.
Raymond E. Brooks owned a 19% interest in the Hill & Brooks Coffee Company (the "Company"). The remaining interest in the Company was owned by Leroy Hill, Mr. Brooks's brother-in-law. On June 11, 1993, Hill presented Mr. Brooks with a proposal for Hill to purchase Mr. Brooks's share of the Company for $1,196,753.00 to be paid over 10 years at 8% interest per year. They completed the sale on that date by executing a written sales agreement. Mr. Brooks died on October 26, 1994.
Following Mr. Brooks's death, his wife, Dorothy Hill Brooks, was appointed executrix of his estate. She sued Hill and the Company, claiming that the defendants had misrepresented the value of her late husband's stock and had wrongfully induced him into signing an agreement to sell the stock. She later amended her complaint to allege a breach of fiduciary duty, fraud, and a "willful and intentional" conspiracy to devalue her late husband's stock with intent to purchase it.
The defendants' main arguments in support of the trial court's judgment dismissing Brooks's claims stated in her amended complaint are that:
The trial court granted the defendants' motion to dismiss the amended complaint. Brooks appealed.
The majority concludes that the plaintiff did not allege sufficient facts to support a claim of "squeeze-out." I disagree. Because my conclusions in this case rest largely upon my understanding of the nature of that claim, I will address that issue first.
The nature of the squeeze-out cause of action is the subject of great debate in Alabama and elsewhere. In Burt v. Burt Boiler Works, Inc., 360 So. 2d 327 (Ala.1978), this Court first recognized a cause of action for the squeeze-out of minority shareholders. As a preliminary matter, the Burt Boiler *769 Works Court stated that "[i]t is no longer seriously debated that majority shareholders owe a duty to at least act fairly to the minority interests." Id. at 331. A violation of that duty can give rise to a cause of action. Such a cause of action can arise when the majority shareholders, "acting through the board and corporate officers, which they control, deprive the minority stockholders of their just share of the corporate gains." Id. at 332.
In Galbreath v. Scott, 433 So. 2d 454 (Ala. 1983), the Court reaffirmed the concept of the squeeze-out cause of action. In that case, however, the complaint had been based on a claim that the majority shareholders were wasting corporate assets. The Court held that the claim was properly a derivative one and that the injury to shareholders was only secondary. "In such an action the corporation is the real party in interest and would be the one in whose favor a judgment would be rendered." Id. at 457.
The modern squeeze-out claim came into its own in Ex parte Brown, 562 So. 2d 485 (Ala.1990). In that case, the action was based on a claim that the majority shareholders had attempted to force the minority owners to sell their shares at a price below fair value. The Court held:
Id. at 494 (citations omitted).
Despite our recognition of the squeeze-out cause of action, we nevertheless did not specify in Brown whether it was grounded in contract or in tort. Shortly thereafter, members of the bar began to disagree over the nature of the squeeze-out cause of action.[6] In his concurring opinion in Fulton v. Callahan, 621 So. 2d 1235 (Ala.1993), Justice Houston explained his reasons for believing that the cause of action is one evolving out of contract rather than tort. In a later case, Justice Houston expressed his hope that this Court "would clarify the nature of the cause of action for oppression or squeeze-out of minority stockholders and the rules regarding standing to bring such an action." Gilliland v. USCO Power Equipment Corp., 631 So. 2d 938, 939 (Ala.1994) (Houston, J., concurring in the result). Because Gilliland was reversed on other grounds, that case did not present an appropriate opportunity for this Court to accept Justice Houston's suggestion.
A useful way of understanding the nature of close corporations is to examine the law relating to joint ventures and partnerships.[7] By considering the issues presented in this case from that perspective, one may understand the creation of a close corporation as the creation of "a long-term relational contract which contemplates that each participant will contribute capital or services and that proceeds will be equitably shared." J.A.C. Hetherington, Defining the Scope of Controlling Shareholders' Fiduciary Responsibilities, 22 Wake Forest L.Rev. 9, 22 (1987). Of course, the contract establishing the corporation is embodied in the articles of incorporation. It governs the duties and responsibilities of the shareholders, directors, and officers. That written contract may not, however, contain an explicit statement of all the parties' understandings, but it is implicit *770 that "parties who form closely held firms intend an equitable sharing of returns." Id. at 28. Consequently, I would hold that if the articles do not explicitly reflect that intention of the shareholders, then that intention should be implied.
My view of the nature of the squeeze-out cause of action is based on the theory of an implicit agreement to share the proceeds from the corporation. Squeeze-out claims "can only be given concrete meaning by reference to the explicit or implicit ex ante understanding of the parties and reasonable expectations based upon that understanding." Id. at 25. That understanding, as this Court recognized in Burt Boiler Works, includes a requirement of acting fairly. A violation of the duty to act fairly is a breach of the parties' explicit or implicit agreement. For the breach of that agreement, I believe the appropriate remedy is one that would protect the reasonable expectations of the shareholders.
I agree with the late Dean Hodge O'Neal, whose opinions have had a great impact on the development of close corporation law in Alabama, and who wrote:
F. Hodge O'Neal, Introduction (Symposium: Rights of Minority Shareholders), 22 Wake Forest L.Rev. 1, 5 (1987). According to O'Neal, in fashioning an appropriate remedy in cases before them, trial judges "can `imply' or `construct' additional terms for the contract to give effect to the underlying assumptions of the parties at the time they entered into it and protect reasonable expectations generated by the business relationship which the contract created." Id. at 6.
The distinction I see between closely held corporations and widely held corporations is material to my view on the appropriate resolution of this case. I believe that the most appropriate way of approaching a dispute between shareholders of closely held corporations is to consider it, as discussed above, as a dispute over the breach of the explicit or implicit agreements of the shareholders. Further, I believe that this theory is applicable in cases where the cause of action might traditionally be treated as a derivative claim. Where claims involve closely held corporations, I believe it is more efficient, and a better reflection of the true state of affairs among "partners" in such a business, to treat such claims as claims of squeeze-out.
In count two of her complaint, the plaintiff asserts two claims, one in her individual capacity and one in her capacity as executrix of her husband's estate. With regard to the claim asserted in her individual capacity, the trial court held that because she was not a shareholder in the corporation, Hill owed the plaintiff no fiduciary duty. The majority of this Court reaches the same conclusion. In contrast, I would note that there was no agreement between the plaintiff and the defendants that was breached. Because there was no breach of any agreement, I concur in the result reached by the majority, that the individual claim was properly dismissed.
I now turn to the issue whether the trial court appropriately applied the law to that claim in count two that the plaintiff stated in her capacity as executrix of her husband's estate. The majority concludes that this claim that the defendant wasted corporate assets could be pursued only as a derivative claim; it holds, therefore, that the trial court correctly dismissed that claim.
As I have noted above, this Court, in Burt Boiler Works, recognized a duty of majority shareholders to "act fairly" to minority shareholders. That duty arises from the nature of the relationship between the majority shareholders and the minority shareholders. See Southern Pacific Co. v. Bogert, 250 U.S. 483, 39 S. Ct. 533, 63 L. Ed. 1099 (1919). It is the breach of this duty that gives rise to a *771 claim of minority shareholder squeeze-out.[8] Consequently, I would reverse the trial court's dismissal of this claim.
Counts three and four allege, I believe, a claim of squeeze-out based on the undervaluation of the stock with intent to purchase, alleged to have occurred on June 11, 1993. The trial court held that the claims asserted by Brooks in counts three and four were claims of fraud. Therefore, the court held, they were based on tort and were subject to the two-year statute of limitations. However, construing the allegations of counts three and four in accordance with Rule 8(f), Ala. R. Civ. P., I believe Brooks has stated a claim of minority shareholder squeeze-out; such a claim would, under contract law, be subject to the six-year statute of limitations. § 6-2-34, Ala.Code 1975. Accordingly, I would reverse the trial court's dismissal of counts three and four.
I concur in the result of the majority opinion insofar as it affirms the dismissal of that claim the plaintiff states in count two in her individual capacity. However, I respectfully dissent from the remainder of the majority's opinion. I would reverse the dismissal of the claim the plaintiff states in count two as executrix of the estate of Raymond Brooks; and I would reverse the dismissal of the plaintiff's claims stated in count three and count four.
[1] Section 10-2B-8.32 became effective on January 1, 1995, after the alleged underlying events occurred in this case, but before the plaintiff filed this action. We need not decide what consequences might flow from the date of enactment, because § 10-2B-8.32 simply carries forward, without change, former § 10-2A-71, Ala.Code 1975, which in turn continued § 10-2-167, Ala. Code 1975. See Commentary to § 10-2B-8.32, Ala.Code 1975.
[2] We do acknowledge, however, that, in holding that a predecessor of § 10-2B-8.32 implied a civil cause of action for its violation, the federal court in Belcher expressly stated, "`The disregard of the command of a statute is a wrongful act and a tort.'" 348 F. Supp. at 146, quoting Kardon v. National Gypsum Co., 69 F. Supp. 512 (E.D.Pa.1946).
[3] "Those who embark in a corporate enterprise as stockholders do so under an implied agreement that the business shall be controlled and directed by a majority of the stockholders." Fulton v. Callahan, supra, 621 So. 2d at 1252, quoting Phinizy v. Anniston City Land Co., 195 Ala. 656, 661, 71 So. 469, 471 (1916).
[4] The plaintiff in Fulton v. Callahan was a minority shareholder of a close corporation; he prevailed at trial on his claim that the majority shareholders had intentionally devalued the corporation's stock with the intent to purchase it, in violation of the provisions of § 10-2A-71, Ala. Code 1975, now recodified at § 10-2B-8.32. In holding that sufficient evidence supported the jury's verdict on that claim, the Court concluded its discussion of the issue as follows:
"In our disposition of this issue, we emphasize the special considerations presented by the fact that Callahan was a minority shareholder in a closely held corporation. Callahan's position in the circumstances of this case illustrates the unique vulnerability of minority shareholders in closely held corporations, especially in buy-out negotiations, when often there is no real market for their shares. Because of the limited marketability of their shares and the right of the majority shareholders to control corporate decision-making in closely held corporations, minority shareholders are restricted in their ability to realize the value of their investment, whether it be in the form of salary, dividends, or proceeds from a sale of their stock. Callahan depended, as minority shareholders generally do, on the [majority's] treating him fairly."
[5] We would acknowledge that if the decedent had desired to sell his interest in H & B, he might have had practical difficulties in selling to someone other than Hill, the only other shareholder. We might further concede that in an action alleging fraudulent suppression this circumstance might impact upon whether the majority shareholder of a close corporation would be found to have had a duty to disclose material facts to the minority shareholder. However, a recognition of the potential problems a minority shareholder of a close corporation might have in selling his interest does not imply that a minority shareholder who has been deceived has also been "squeezed-out."
[6] See Andrew P. Campbell, Litigating Minority Shareholder Rights and the New Tort of Oppression, 53 Ala. Law. 108 (1992), and Michael E. DeBow, "Oppression" of Minority Shareholders: Contract, Not Tort, 54 Ala. Law. 128 (1993).
[7] In Galbreath, we recognized that "[w]hen shareholders serve on the board of directors and appoint themselves as officers, the enterprise acquires many of the attributes of a partnership or sole proprietorship and ceases to fit neatly into the classical corporate scheme." 433 So. 2d at 457.
[8] In Ex parte Brown, supra, this Court discussed some of the ways the claim may be triggered:
"`The squeezers may refuse to declare dividends; they may drain off the corporation's earnings by exorbitant salaries and bonuses to the majority shareholder-officers and perhaps to their relatives, by high rental agreements for property the corporation leases from majority shareholders, or by unreasonable payments under contracts between the corporation and majority shareholders; they may deprive minority shareholders of corporate offices and of employment by the company; they may cause the corporation to sell its assets at an inadequate price to the majority shareholders or to companies in which the majority are interested; they may organize a new company in which the minority will have no interest, transfer the corporation's assets or business to it, and perhaps then dissolve the old corporation; or they may bring about the merger or consolidation of the corporation under a plan unfair to the minority.'"
562 So. 2d at 492 (quoting F.H. O'Neal and R. Thompson, O'Neal's Oppression of Minority Shareholders § 3:02 (2d ed.1985)). | bff4b969c5f8c471495e62c70236be7e5640bc4267863c48250931142c2ceef5 | 1998-06-12 00:00:00 |