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9b169b69-eafc-4a21-93f2-a8b47c758add | Bryant Bank v. M.E.C. Investments, LLC | N/A | 1160502 | Alabama | Alabama Supreme Court | Rel: December 15, 2017
STATE OF ALABAMA -- JUDICIAL DEPARTMENT
THE SUPREME COURT
OCTOBER TERM, 2017-2018
1160502
Bryant Bank v. M.E.C. Investments, LLC (Appeal from Shelby
Circuit Court: CV-13-900884).
PARKER, Justice.
AFFIRMED. NO OPINION.
See Rule 53(a)(1) and (a)(2)(E), Ala. R. App. P.
Stuart, C.J., and Bolin, Shaw, Main, Wise, and Bryan,
JJ., concur.
Murdock and Sellers, JJ., dissent. | December 15, 2017 |
c7f1d11f-2954-4793-80ca-c0c67f0f015b | Ex parte Michael Sheldon Poole. | N/A | 1170112 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1170112
Ex parte Michael Sheldon Poole. PETITION FOR WRIT OF CERTIORARI TO THE COURT
OF CIVIL APPEALS (In re: Michael Sheldon Poole v. Melanie Holley Poole) (Lauderdale
Circuit Court: DR-12-900132; Civil Appeals :
2160239).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Murdock, J. - Stuart, C.J., and Bolin, Main, and Bryan, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
l i t a
Clerk, Supreme Court of Alabama | December 8, 2017 |
d48672ef-7875-42a5-9d3c-2f230b404eb7 | Ex parte Anthony Tyson. | N/A | 1160935 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 15, 2017
1160935
Ex parte Anthony Tyson. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF
CRIMINAL APp Ea LS (In re: Anthony Tyson v. State of Alabama) (Macon Circuit Court:
CC-97-54.60; Criminal Appeals :
CR-14-0945).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 15, 2017:
Writ Denied. No Opinion. Murdock, J. - Stuart, C.J., and Bolin, Shaw, Main, Wise,
Bryan, and Sellers, JJ., concur. Parker, J., recuses himself.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 15th day of December, 2017.
l i t a
Clerk, Supreme Court of Alabama | December 15, 2017 |
7d9de4b7-df27-4ce6-aad4-d0951d02d88d | Ex parte City of Homewood. | N/A | 1161022 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1161022
Ex parte City of Homewood. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF
CRIMINAL Ap p e a l s (In re: Laura Arteaga Gonzalez v. City of Homewood) (Jefferson
Circuit Court: CC-15-2613; CC15--2614; Criminal Appeals :
CR-15-1272).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Shaw, J. - Stuart, C.J., and Parker, Wise, and Sellers, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
l i t a
Clerk, Supreme Court of Alabama | December 8, 2017 |
55c0a843-2d23-4876-a926-7499414bb9fd | Ex parte Gary Bell. | N/A | 1170047 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1170047
Ex parte Gary Bell. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF CIVIL
APPEALS (In re: Gary Bell v. Jon Garlick) (Calhoun Circuit Court: CV-17-16; Civil Appeals :
2160911).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Bryan, J. - Stuart, C.J., and Bolin, Murdock, and Main, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
l i t a
Clerk, Supreme Court of Alabama | December 8, 2017 |
c53e6b75-56c0-4dc2-bebf-e7899ac9c77c | Jason Payton v. Adam Thrasher | N/A | 1160599 | Alabama | Alabama Supreme Court | Rel: December 8, 2017
STATE OF ALABAMA -- JUDICIAL DEPARTMENT
THE SUPREME COURT
OCTOBER TERM, 2017-2018
1160599
Jason Payton v. Adam Thrasher (Appeal from Etowah Circuit
Court: CV-11-53).
BRYAN, Justice.
AFFIRMED. NO OPINION.
See Rule 53(a)(1) and (a)(2)(F), Ala. R. App. P.
Stuart, C.J., and Bolin, Murdock, and Main, JJ., concur. | December 8, 2017 |
cfcca99c-7715-4b8f-9c4f-e50d0cf12297 | Mary Jane Darby et al. v. James H. Crenshaw and the Estate of Victoria Darby Crenshaw, deceased | N/A | 1160732 | Alabama | Alabama Supreme Court | Rel: December 8, 2017
STATE OF ALABAMA -- JUDICIAL DEPARTMENT
THE SUPREME COURT
OCTOBER TERM, 2017-2018
1160732
Mary Jane Darby et al. v. James H. Crenshaw and the Estate of
Victoria Darby Crenshaw, deceased. (Appeal from Lauderdale
Circuit Court: CV-15-900285).
PARKER, Justice.
AFFIRMED. NO OPINION.
See Rule 53(a)(1) and (a)(2)(F), Ala. R. App. P.
Stuart, C.J., and Shaw, Wise, and Bryan, JJ., concur.
Sellers, J., recuses himself. | December 8, 2017 |
1e30d0b2-62b6-43f7-98a5-e8c30d7a4d06 | Ex parte Stephen Wayne Mount. | N/A | 1170084 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1170084
Ex parte Stephen Wayne Mount. PETITION FOR WRIT OF CERTIORARI TO THE COURT
OF CRIMIn Al APPe Al S (In re: Stephen Wayne Mount v. Alabama Board of Pardons and
Paroles) (Montgomery Circuit Court: CV-17-12; Criminal Appeals :
CR-16-0674).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Wise, J. - Stuart, C.J., and Parker, Shaw, and Sellers, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
Clerk, Supreme Court of Alabama | December 8, 2017 |
71e5bc6e-6ab1-43c9-8c08-028c90e8d9af | Wilson v. University of Alabama Health Services Foundation, P.C. | N/A | 1160654 | Alabama | Alabama Supreme Court | Rel: December 15, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334)
229-0649), of any typographical or other errors, in order that corrections may be made
before the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
_________________________
1160654
_________________________
Lisa Wilson
v.
University of Alabama Health Services Foundation, P.C., et
al.
Appeal from Jefferson Circuit Court
(CV-17-900522)
SHAW, Justice.
Lisa Wilson, the plaintiff below, appeals from the
dismissal of her complaint seeking damages against the
defendants, University of Alabama Health Services Foundation,
P.C. ("UAHSF"); Carla Falkson, M.D.; Tina Wood, M.D.; Ravi
Kumar Paluri, M.D.; and Mollie DeShazo, M.D., based on the
1160654
tort of outrage. We reverse and remand.
Facts and Procedural History
In February 2017, Wilson sued UAHSF and its employees,
Dr. Falkson, Dr. Wood, Dr. Paluri, and Dr. DeShazo
(hereinafter referred to collectively as "the doctors"), in
the Jefferson Circuit Court. Wilson's complaint alleged that,
in late 2011, her elderly mother, Elizabeth Monk Wilson
("Elizabeth"), was diagnosed with and underwent treatment for
colon cancer. According to Wilson, before the onset of
Elizabeth's illness, Elizabeth had executed an advanced
health-care
directive that
"instruct[ed] ...
caregivers
to
use
all available means to preserve [Elizabeth's] life" and
further named Wilson as Elizabeth's health-care proxy "in the
event [Elizabeth] became 'too sick to speak for' herself."
Elizabeth subsequently suffered a recurrence of her
cancer. In August 2015, she was admitted to the University of
Alabama at Birmingham Hospital, a facility operated by UAHSF.
In her complaint, Wilson alleged that, while Elizabeth was in
the hospital, she was treated by the doctors. She further
alleged that the doctors made numerous and repeated tactless
comments to Elizabeth and Wilson about Elizabeth's condition
2
1160654
and her impending death, and to the effect that she was
wasting resources by being in the hospital instead of dying at
home. The complaint provides a long, extremely detailed
discussion of countless alleged egregious statements made to
Elizabeth and Wilson and numerous altercations between Wilson
and Elizabeth, on the one hand, and the doctors, on the other.
We see no need to repeat those allegations here. The
complaint further details the alleged physical and mental
distress experienced by both Elizabeth and Wilson in response
to the doctors' alleged conduct.
Based on the foregoing, Wilson's complaint alleged a
single claim for damages "for the tort of outrage, and for the
tort of intentional infliction of emotional distress"1 and
sought compensatory and punitive damages. Wilson sought to
hold UAHSF vicariously liable for the alleged conduct of the
doctors, which conduct, she alleged, occurred within the line
and scope of the doctors' employment with UAHSF.
In response, UAHSF and the doctors jointly moved to
1As UAHSF and the doctors explained in the trial court,
although Wilson's complaint includes claims of both the tort
of outrage and the intentional infliction of emotional
distress, "the tort of outrage is the same cause of action as
intentional infliction of emotional distress." Thomas v.
Williams, 21 So. 3d 1234, 1237 (Ala. Civ. App. 2008).
3
1160654
dismiss Wilson's complaint pursuant to Rule 12(b)(6), Ala. R.
Civ. P. More specifically, in addition to denying that the
conduct Wilson attributed to them had ever occurred, they
argued that Alabama law recognizes the tort of outrage only in
certain narrowly defined circumstances not applicable in the
instant case. See Callens v. Jefferson Cty. Nursing Home, 769
So. 2d 273, 281 (Ala. 2000). They further argued that this
Court has repeatedly rejected the expansion of the tort of
outrage to encompass "alleged extreme behavior in the
healthcare context." See, e.g., Grantham v. Vanderzyl, 802
So. 2d 1077 (Ala. 2001); Callens, supra; and Gallups v.
Cotter, 534 So. 2d 585, 588 (Ala. 1988). Thus, according to
UAHSF and the doctors, Wilson's claim was unsupported by
Alabama law and represented an "attempt to expand the scope of
[the] tort" and, therefore, failed to state a claim as a
matter of law.
The trial court dismissed the action, stating:
"In considering the defendants' motion, the
court regards the allegations in the complaint as
true. Those allegations paint a picture of egregious
misconduct. The Alabama Supreme Court, however, has
made clear that the tort of intentional infliction
of emotional distress, or outrage, is limited to
three situations, none of which applies here. It
will be up to the Supreme Court to decide whether to
4
1160654
expand
that
tort's
applicability
to
the
circumstances presented here."
Wilson appeals.
Standard of Review
"'In Nance v. Matthews, 622 So. 2d 297 (Ala.
1993), this Court stated the standard of review
applicable to a ruling on a motion to dismiss:
"'"On appeal, a dismissal is
not entitled to a presumption of
correctness.
The
appropriate
standard of review under Rule
12(b)(6)[, Ala. R. Civ. P.,] is
whether, when the allegations of
the complaint are viewed most
strongly in the pleader's favor,
it appears that the pleader could
prove any set of circumstances
that
would
entitle
[it]
to
relief.
In
making
this
determination, this Court does
not
consider
whether
the
plaintiff
will
ultimately
prevail, but only whether [it]
may possibly prevail. We note
that a Rule 12(b)(6) dismissal is
proper
only
when
it
appears
beyond doubt that the plaintiff
can prove no set of facts in
support of the claim that would
entitle the plaintiff to relief."
"'622 So. 2d at 299 (citations omitted).'
"Knox v. Western World Ins. Co., 893 So. 2d 321, 322
(Ala. 2004)."
Ex parte Troy Univ., 961 So. 2d 105, 108 (Ala. 2006).
5
1160654
Discussion
In their brief, the doctors deny that they were
"heartless or insulting" during their interactions with
Wilson and Elizabeth. Nevertheless, the standard of review in
this type case requires that we accept as true the allegations
in the complaint, however implausible:
"At the motion-to-dismiss stage, however, a
court's ability to pick and choose which allegations
of the complaint to accept as true is constrained by
Alabama's broad and well settled standard for the
dismissal of claims under Rule 12(b)(6). ... [O]ur
standard of review does not permit this Court to
consider the plausibility of the allegations.
Rather, in considering whether a complaint is
sufficient to withstand a motion to dismiss, we must
take the allegations of the complaint as true,
Ussery v. Terry, 201 So. 3d 544, 546 (Ala. 2016); we
do
not
consider
'"whether
the
pleader
will
ultimately prevail but whether the pleader may
possibly prevail,"' Daniel v. Moye, 224 So. 3d 115,
127 (Ala. 2016) (quoting Newman v. Savas, 878 So. 2d
1147, 1149 (Ala. 2003) (emphasis added)); and '[w]e
construe all doubts regarding the sufficiency of the
complaint in favor of the plaintiff.' Daniel, 224
So. 3d at 127."
Ex parte Austal USA, LLC, [Ms. 1151138, March 3, 2017] ___ So.
3d ___, ___ (Ala. 2017).
For a plaintiff to recover under the tort of outrage, she
must demonstrate that the defendant's conduct (1) was
intentional or reckless; (2) was extreme and outrageous; and
6
1160654
(3) caused emotional distress so severe that no reasonable
person could be expected to endure it. Green Tree Acceptance,
Inc. v. Standridge, 565 So. 2d 38, 44 (Ala. 1990). The
conduct complained of must "be so extreme in degree as to go
beyond all possible bounds of decency and be regarded as
atrocious and utterly intolerable in a civilized society."
Id.
This Court has previously recognized the tort of outrage
in three circumstances:
"The tort of outrage is an extremely limited
cause of action. It is so limited that this Court
has recognized it in regard to only three kinds of
conduct: (1) wrongful conduct in the family-burial
context, Whitt v. Hulsey, 519 So. 2d 901 (Ala.
1987); (2) barbaric methods employed to coerce an
insurance settlement, National Sec. Fire & Cas. Co.
v. Bowen, 447 So. 2d 133 (Ala. 1983); and (3)
egregious sexual harassment, Busby v. Truswal Sys.
Corp., 551 So. 2d 322 (Ala. 1989). See also Michael
L. Roberts and Gregory S. Cusimano, Alabama Tort
Law, § 23.0 (2d ed. 1996)."
Potts v. Hayes, 771 So. 2d 462, 465 (Ala. 2000). However, as
Wilson notes in her brief, this Court has not held that the
tort of outrage can exist in only those three circumstances:
"That is not to say, however, that the tort of
outrage is viable in only the three circumstances
noted in Potts. Recently, this Court affirmed a
judgment on a tort-of-outrage claim asserted against
a family physician who, when asked by a teenage
7
1160654
boy's mother to counsel the boy concerning his
stress over his parents' divorce, instead began
exchanging
addictive
prescription
drugs
for
homosexual sex for a number of years, resulting in
the boy's drug addiction. See O'Rear v. B.H., 69 So.
3d 106 (Ala. 2011). It is clear, however, that the
tort of outrage is viable only when the conduct is
'"so outrageous in character and so extreme in
degree as to go beyond all possible bounds of
decency, and to be regarded as atrocious and utterly
intolerable in a civilized society."' Horne v. TGM
Assocs., L.P., 56 So. 3d 615, 631 (Ala. 2010)
(quoting [American Road Service Co. v.] Inmon, 394
So. 2d [361, 365 (Ala. 1980)])."
Little v. Robinson, 72 So. 3d 1168, 1172–73 (Ala. 2011)
(emphasis added).
The trial court's holding that the tort of outrage "is
limited to three situations" is an incorrect statement of the
law. As noted in Little, the tort can be viable outside the
context of the above-identified circumstances and has
previously been held to be so viable. We therefore reverse
the trial court's judgment and remand the case for further
proceedings where the trial court should, under the standard
appropriate for a motion to dismiss under Rule 12(b)(6),
determine whether the alleged conduct was "so extreme in
degree as to go beyond all possible bounds of decency and be
regarded as atrocious and utterly intolerable in a civilized
society." Green Tree, 771 So. 2d at 465.
8
1160654
Conclusion
The judgment of the trial court is reversed, and the case
is remanded for further proceedings consistent with this
opinion.
REVERSED AND REMANDED.
Stuart, C.J., and Parker, Main, Wise, and Bryan, JJ.,
concur.
Bolin, Murdock, and Sellers, JJ., dissent.
9
1160654
MURDOCK, Justice (dissenting).
I dissent from the judgment of this Court because I
believe this Court can and, given the posture of the issue
presented, should proceed to decide the legal question it is
remanding to the trial court.
I agree that tort-of-outrage claims are not necessarily
limited to the three categories we commonly have recognized as
appropriate for such a claim. We have emphasized that "[t]he
tort of outrage is an extremely limited cause of action,"
which we traditionally have "recognized ... in regard to only
three kinds of conduct: (1) wrongful conduct in the
family-burial context ...; (2) barbaric methods employed to
coerce an insurance settlement ...; and (3) egregious sexual
harassment." Potts v. Hayes, 771 So. 2d 462, 465 (Ala. 2000)
(citations omitted). But we also have observed that the tort
of outrage is not "viable in only the three circumstances
noted in Potts." Little v. Robinson, 72 So. 3d 1168, 1173
(Ala. 2011).
Thus, the trial court erred to the extent it dismissed
Wilson's claim solely on the ground that her claim did not
fall into one of those three categories. But the trial
court's erroneous rationale does not necessarily require us
to
10
1160654
reverse its judgment or to remand this case. "This Court may
affirm a trial court's judgment on 'any valid legal ground
presented by the record, regardless of whether that ground was
considered, or even if it was rejected, by the trial court.'"
General Motors Corp. v. Stokes Chevrolet, Inc., 885 So. 2d
119, 124 (Ala. 2003) (quoting Liberty Nat'l Life Ins. Co. v.
University of Alabama Health Servs. Found., P.C., 881 So. 2d
1013, 1020 (Ala. 2003)). "This rule fails in application only
where due-process constraints require some notice at
the
trial
level, which was omitted, of the basis that would otherwise
support an affirmance ...." University of Alabama Health
Servs., 881 So. 2d at 1020.
In this instance, the main opinion reverses the judgment
of the trial court and remands with the instruction that the
trial court "should, under the standard appropriate for a
motion to dismiss under Rule 12(b)(6), [Ala. R. Civ. P.,]
determine whether the alleged conduct was 'so extreme in
degree as to go beyond all possible bounds of decency and be
regarded as atrocious and utterly intolerable in a civilized
society.'" ___ So. 3d at ___. In other words, the trial
court is being instructed to determine whether the facts
alleged by Lisa Wilson, assuming they could be proven, state
11
1160654
a cognizable tort-of-outrage claim under Alabama law. This is
a legal determination this Court is permitted to undertake
just as rightfully as the trial court, and I see no reason for
us to forgo that responsibility in this case. Nor is there is
any due process hindrance in doing so, because the parties --
in both the trial court and in this Court -- provided well
fleshed out arguments as to whether the alleged facts in this
case rise to the level of a cognizable tort-of-outrage claim
under Alabama law. As this case is postured, I see no need to
require the trial court to perform a legal analysis that this
Court could proceed to perform without the necessity of a
remand.
Because the main opinion does not specifically address
whether Wilson has stated a cognizable tort-of-outrage claim,
I decline to do so as well. But see generally American Rd.
Serv. Co. v. Inmon, 394 So. 2d 361, 364–65 (Ala. 1980) (noting
that the tort of outrage "does not recognize recovery for
'mere insults, indignities, threats, annoyances, petty
oppressions, or other trivialities.'" (quoting Comment,
Restatement (Second) of Torts § 46 p. 73 (1948)).
Sellers, J., concurs.
12 | December 15, 2017 |
73a7c225-1ce4-4200-af62-384da4741228 | Ex parte Mollie M. Bearden. | N/A | 1170061 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1170061
Ex parte Mollie M. Bearden. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF
CRIMINAL APPEALS (In re: Mollie M. Bearden v. State of Alabama) (Talladega District
Court: DC-16-329; DC-16-330; Criminal Appeals :
CR-15-1491).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Sellers, J. - Stuart, C.J., and Parker, Shaw, and Wise, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
l i t a
Clerk, Supreme Court of Alabama | December 8, 2017 |
7780046d-ac1b-4036-9040-22220c3c891d | J. Thomas Barnett, Jr., and City of Birmingham v. Elbow River Marketing Limited Partnership | N/A | 1160678 | Alabama | Alabama Supreme Court | Rel: December 8, 2017
STATE OF ALABAMA -- JUDICIAL DEPARTMENT
THE SUPREME COURT
OCTOBER TERM, 2017-2018
1160678
J. Thomas Barnett, Jr., and City of Birmingham v. Elbow River
Marketing Limited Partnership (Appeal from Jefferson Circuit
Court: CV-14-624).
WISE, Justice.
AFFIRMED. NO OPINION.
See Rule 53(a)(1) and (a)(2)(A), Ala. R. App. P.
Stuart, C.J., and Parker, Shaw, and Sellers, JJ., concur. | December 8, 2017 |
ac40d6c1-ad34-4e51-b21a-7e6b3eab4e18 | Ex parte James Beamon-Bey. | N/A | 1170060 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1170060
Ex parte James Beamon-Bey. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF
CRIMINAL APPEALS (In re: State of Alabama v. James Beamon Bey) (Montgomery Circuit
Court: CC-91-1839; CC-08-1370; Criminal Appeals :
CR-16-0634).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Murdock, J. - Stuart, C.J., and Bolin, Main, and Bryan, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
l i t a
Clerk, Supreme Court of Alabama | December 8, 2017 |
1caf8462-0245-44b5-820b-0dd84ec5adda | Deaton, Inc. v. Monroe | 762 So. 2d 840 | 1981549 | Alabama | Alabama Supreme Court | 762 So. 2d 840 (2000)
DEATON, INC.
v.
H.E. MONROE, as Commissioner of the Alabama Department of Revenue, et al.
1981549.
Supreme Court of Alabama.
February 18, 2000.
*841 James M. Sizemore, Jr., Montgomery, for appellant.
John J. Breckenridge, asst. counsel, Department of Revenue, and deputy atty. gen., for appellee Commissioner of Revenue.
Reginald L. Sorrells, general counsel, Department of Agriculture and Industries, and deputy atty. gen., and Robert J. Russell, counsel, Department of Agriculture and Industries, and asst. atty. gen., for appellee Commissioner of Agriculture and Industries.
Thomas R. DeBray and Carla Cole Gilmore of Kaufman & Rothfeder, P.C., Montgomery, for appellee Mack Roberts, as Director of the Alabama Dep't. of Transportation.
HOUSTON, Justice.
Deaton, Inc., filed this action in the Montgomery Circuit Court against James P. Hayes, as commissioner of the Department of Revenue,[1] and Charles Bishop, as commissioner of the Department of Agriculture and Industries, seeking a judgment declaring that the statute imposing the "Alabama Pump Inspection Fee"[2] violates the Interstate Commerce Clause of the United States Constitution and declaring that a refund is due under the International Fuel Tax Agreement ("IFTA"). See 49 U.S.C.A. § 31701(3). The trial court granted the motion to intervene filed by Mack Roberts, as commissioner of the Department of Transportation.
The Department of Agriculture and Industries moved for a summary judgment. Its motion was accompanied by a brief containing citations to caselaw, but the motion did not refer to any affidavit, deposition, exhibit, or any other part of an evidentiary record. The motion included an argument that Deaton had failed to state a claim upon which relief could be granted. The motion also included the following statement: "In support of this motion, [the defendant] relies on the Complaint, subsequent pleadings and Memorandum Brief filed with this motion."
Deaton did not file a "statement in opposition" to the motion (see Rule 56(c)(1), Ala. R. Civ. P.), but instead argued that the motion was not properly supported, as required by Rule 56(c), because the motion was not supported by any evidence. Therefore, Deaton argued, the motion, styled as a motion for a summary judgment, should be considered as a motion for a judgment on the pleadings. The trial court held "that the Motion for Summary Judgment of the Commissioner of Agriculture sufficiently satisfies the requirements of Rule 56 ... and that Deaton, with proper notice of the Motion hearing, failed to timely oppose as required by the Rule." Thus, it determined that the motion was one for a summary judgment, not one for a judgment on the pleadings, and it granted the motion. The trial court's order further indicated that its summary judgment for the Department of Agriculture and Industries made the action moot as to the other parties.
The Department of Agriculture and Industries rested on the complaint and the case-law cited in support of its motion, and the trial court entered a judgment based on those materials. No evidence outside the pleadings was presented to, or considered *842 by, the trial court. Therefore, the trial court erred in treating the motion as one for a summary judgment.
However, we will affirm the judgment of the trial court if we find any reason that makes the judgment proper, even one that was not presented to, or considered by, the trial court. Southern United Fire Ins. Co. v. Knight, 736 So. 2d 582 (Ala.1999) (citing, Smith v. Equifax Servs., Inc., 537 So. 2d 463 (Ala.1988)). Under this rule, the judgment could be affirmed if the Department of Agriculture and Industries would have been entitled to a judgment on the pleadings.
"Rule 12(c) allows a party to move for a judgment on the pleadings. When such a motion is made, the trial court reviews the pleadings filed in the case and, if the pleadings show that no genuine issue of material fact is presented, the trial court will enter a judgment for the party entitled to a judgment according to the law." B.K.W. Enters. v. Tractor & Equip. Co., 603 So. 2d 989, 991 (Ala.1992) (citations omitted). We affirm the judgment of the trial court, for this reason.
Deaton's complaint alleges that it is entitled to a refund for tax paid, pursuant to § 8-17-87, by the "person first selling" certain petroleum products. Deaton argues that the payor of this tax, a tax referred to by the statute as an "inspection fee," passes the tax on to Deaton, and Deaton says it is the consumer. Deaton uses part of the taxed fuel outside the State of Alabama, and thus, Deaton says in Count I, the IFTA creates a basis for a refund and, it says in Count II, the tax violates the Commerce Clause.
From the pleadings, it appears undisputed that Deaton does not directly pay the tax. The tax is paid by "the person first selling," § 8-17-87(b), and is paid for "petroleum products sold, offered for sale, stored, or used in the state." § 8-17-87(a). This is not a direct tax on fuel consumed in a motor vehicle. Generally it is a tax on the storage of the fuel. The IFTA provides a refund for state "fuel use" taxes that apply to fuel sold in a particular State but subsequently used outside that State. The IFTA defines a "fuel use tax" as "a tax imposed on or measured by the consumption of fuel in a motor vehicle." See 49 U.S.C.A. § 31701(2). The inspection fee of § 8-17-87 is not measured by the consumption of fuel in a motor vehicle; it is a tax measured against the person first selling, storing, or using the fuel. This is not a "fuel use" tax, as defined by the IFTA. Therefore, Count I does not state a claim upon which relief can be granted.
Next, we consider Deaton's argument that the statute imposing the pumpinspection fee violates the Commerce Clause, U.S. Const. Art. I, § 8, cl. 3. It is undisputed that Deaton is not a "person first selling." The only manner in which Deaton alleges this inspection fee affects it is if the "person first selling" chooses to pass the cost of the fee on to the consumer. That choice is not a choice made by the State. This Court has stated that we "`seek to sustain rather than strike down the enactment of a coordinate branch of the government'" and that we "will not hold an act unconstitutional `unless it is clear beyond reasonable doubt that [the act violates] the [constitution].'" State v. Alabama Mun. Ins. Corp., 730 So. 2d 107, 110 (Ala.1998) (quoting Alabama State Fed'n of Labor v. McAdory, 246 Ala. 1, 9, 18 So. 2d 810, 815 (1944)). However, if a statute violates a constitutional provision, that fact cannot be ignored. The United States Supreme Court has held that a tax can have an indirect application that violates the Commerce Clause. "The negative or dormant implication of the Commerce Clause prohibits taxation, or regulation, that discriminates against or unduly burdens interstate commerce and thereby `imped[es] free private trade in the national marketplace.'" General Motors Corp. v. Tracy, 519 U.S. 278, 287, 117 S. Ct. 811, 136 L. Ed. 2d 761 (1997) (citations omitted).
*843 Deaton has not shown the statute at issue§ 8-17-87, Ala.Code 1975to violate the Commerce Clause. This statute includes a limiting clause that prevents the administration of the statute from violating the Commerce Clause, by requiring the Department of Agriculture and Industries to comply with the Interstate Commerce Clause when collecting the tax:
§ 8-17-87(i). Clearly, this section shows that the Legislature intended to avoid a Commerce Clause violation. A plain reading of this self-limiting clause suggests the clause is sufficient to prevent the statute from violating the Commerce Clause. Deaton perhaps could have alleged in its complaint that the Department of Agriculture and Industries was collecting the tax in violation of the Commerce Clause and, thus, that this self-limiting clause was not being complied with. Deaton, however, did not make such an allegation in its complaint. Therefore, Deaton's complaint failed, as a matter of law, to state a ground on which relief could be granted.
AFFIRMED.
HOOPER, C.J., and MADDOX, COOK, LYONS, BROWN, JOHNSTONE, and ENGLAND, JJ., concur.
SEE, J., concurs in the result.
[1] James P. Hayes succeeded H.E. Monroe as commissioner of the Department of Revenue. Rule 43(b), Ala. R.App. P., provides that, when an officeholder leaves office, the successor is automatically substituted as a party.
[2] See Ala.Code 1975, § 8-17-87. Specifically, Deaton complains of that fee set out at § 8-17-87(a)(2). | February 18, 2000 |
5ea33f3b-fc40-4848-8fdf-8c7a147316fa | Ex parte Theron Lamar Christian. | N/A | 1170096 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 15, 2017
1170096
Ex parte Theron Lamar Christian. PETITION FOR WRIT OF CERTIORARI TO THE COURT
OF CRIMINAL APPEALS (In re: Theron Lamar Christian v. State of Alabama) (Calhoun
Circuit Court: CC14-1709; Criminal Appeals :
CR-15-1181).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 15, 2017:
Writ Denied. No Opinion. Bryan, J. - Stuart, C.J., and Bolin, Parker, Shaw, Main, Wise,
and Sellers, JJ., concur. Murdock, J., dissents.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 15th day of December, 2017.
l i t a
Clerk, Supreme Court of Alabama | December 15, 2017 |
8f103210-35ee-4cd5-a916-71f5a9f56681 | Minnie Brown v. Deborah Tisdale, M.D., et al. | N/A | 1160126 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1160126
Minnie Brown v. Deborah Tisdale, M.D., et al. (Appeal from Marengo Circuit
Court: CV-13-900088).
CERTIFICATE OF JUDGMENT
WHEREAS, the ruling on the application for rehearing filed in this case and indicated
below was entered in this cause on December 8, 2017:
Application Overruled. No Opinion. Shaw, J. - Stuart, C.J., and Parker, Wise, and Sellers,
JJ., concur.
WHEREAS, the appeal in the above referenced cause has been duly submitted and
considered by the Supreme Court of Alabama and the judgment indicated below was entered
in this cause on October 13, 2017:
Affirmed. No Opinion. Shaw, J. - Stuart, C.J., and Parker, Wise, and Sellers, JJ., concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
Clerk, Supreme Court of Alabama | December 8, 2017 |
cad74a81-1826-432c-95c3-cdc41fff05b2 | Newell v. Newell | N/A | 1160851 | Alabama | Alabama Supreme Court | Rel: December 15, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
____________________
1160851
____________________
Alan Newell
v.
Floyd Newell
Appeal from Franklin Circuit Court
(CV-13-900037)
MAIN, Justice.
Alan Newell appeals from a summary judgment entered
against him on various claims and counterclaims relating to
two tracts of real property located in Franklin County. For
the following reasons, we reverse and remand.
1160851
I. Facts and Procedural History
This appeal arises from a dispute between a father, Floyd
Newell, and his son, Alan, regarding the ownership of two
tracts of land located in Franklin County. The two tracts are
farmland referred to, respectively, as "the Hester farm" and
"the DeVaney farm."1 Floyd is the title owner of the two
properties. Alan, however, claims to be the true owner of the
properties and asserts that the properties were deeded to
Floyd only as security for loans Floyd made to Alan to
purchase the land.
On February 21, 2013, Floyd sued Alan, asserting claims
of ejectment and detinue. Specifically, Floyd alleged that
Alan was unlawfully withholding possession from Floyd of the
Hester farm and the DeVaney farm, as well as a number of items
of personal property allegedly belonging to Floyd. Alan filed
a counterclaim that also alleged claims of ejectment and
detinue. Alan contended that it was, in fact, Floyd who had
wrongfully obtained possession of the Hester farm and the
DeVaney farm and who was precluding Alan's rightful access to
the properties. Alan also contended that Floyd was wrongfully
1The DeVaney farm is also sometimes referred to in the
record as "the McAfee farm."
2
1160851
withholding various items of Alan's personal property. Alan
subsequently amended his counterclaim to add counts seeking a
declaration of an equitable mortgage for both the Hester farm
and the DeVaney farm. Alan contended that he purchased each
property with a loan from Floyd and that the deed to each
property was placed in Floyd's name as security for purchase-
money loans.
Floyd moved for a summary judgment as to the ejectment
and equitable-mortgage counterclaims, contending that there
was no genuine issue as to any material fact regarding the
ownership of the two properties. The deposition testimony of
Floyd and Alan was submitted in support of and in opposition
to the summary-judgment motion. That testimony is hopelessly
at odds.
Alan testified that the Hester farm was purchased in
1992. He claims that, upon learning that the farm was for
sale, he arranged financing to purchase the property from a
local bank. According to Alan, before the closing on the sale
of the property, Floyd offered to finance the purchase so long
as Alan agreed to repay the full purchase price of $65,000,
plus $5,000 in interest. Alan says that, at the time of
3
1160851
purchase, he paid Floyd $35,000 toward the purchase price.
According to Alan, the title to the Hester farm was placed in
Floyd's name as security for the loan Floyd made to Alan.
Alan claims that he made payments toward the loan and that it
was paid off in 1999. Alan also claims that he was in
possession of the Hester farm following its purchase. He
testified that he raised cattle on the Hester farm for several
years; that he built an entrance to the farm secured by a
gate; that he paid half the cost of constructing a barn on the
farm; and that he placed a mobile home and a camper on the
farm.
As to the DeVaney farm, Alan contends that he also
purchased this property through a loan from Floyd and that the
title to the DeVaney farm was, like the Hester farm, held by
Floyd as security for the loan. Alan testified that the
property was purchased at auction in 1995 for $89,000. Alan
contends that repayment of the loan he used to purchase the
DeVaney farm was accomplished by the withholding of $10,000 in
annual compensation that he was allegedly due from the family
business. Specifically, he claims that he was a partner in
Floyd's heating and air-conditioning business and that, as
4
1160851
part of his compensation, the company was making a $10,000 per
year contribution into a retirement account established for
Alan. Alan claims that he and Floyd agreed that Floyd would
withhold the retirement contribution for nine consecutive
years to pay off the loan. Alan states that he kept cattle on
the DeVaney farm; that he cut, hauled, and stored hay on the
farm; that he built a fence and gates around the farm; and
that he paid for all the improvements to the farm.
Floyd flatly denies Alan's claim of ownership of the two
farms. Floyd contends that he purchased both the Hester farm
and the DeVaney farm and that he owns the farms outright. He
denies lending Alan money to purchase the properties. He
denies that Alan made any payments to him toward the purchase
price of the farms. He disputes claims that Alan made
improvements to the farms. He denies that Alan was a partner
in his heating and air-conditioning business or that any
retirement account or contribution was ever set up for Alan or
that he received any payment from Alan through withholding
such funds. Floyd admits to no more than allowing Alan to use
the properties in varying degrees over the years.
5
1160851
On August 3, 2015, the trial court entered a partial
summary judgment in favor of Floyd as to the ejectment claim
and counterclaim and as to Alan's claim seeking recognition of
an equitable mortgage. The trial court specifically held that
the basis for Alan's claim of ownership of the two tracts of
real property was barred by the Statute of Frauds. On May 15,
2017, the trial court entered a final judgment disposing of
all remaining claims. This appeal followed.
II. Standard of Review
Alan's appeal concerns only the claims disposed of by the
partial summary judgment. Our review of a summary judgment is
de novo. Tanner v. State Farm Fire & Cas. Co., 874 So. 2d
1058, 1063 (Ala. 2003). In reviewing a summary judgment, we
apply the same standard used by the trial court -- whether
there has been a showing that there is no genuine issue of
material fact and that the movant is entitled to a judgment as
a matter of law. Rule 56, Ala. R. Civ. P.; Bond v.
McLaughlin, [Ms. 1151215, Feb. 24, 2017] __ So. 3d __, ___
(Ala. 2017). Moreover, we review all evidence in the light
most favorable to the nonmovant. Foster v. North Am. Bus
6
1160851
Indus., Inc., [Ms. 1150716, April 28, 2017] __ So. 3d __, ___
(Ala. 2017).
III. Analysis
On appeal, Alan argues that there are material facts in
dispute concerning his interest in the Hester farm and the
DeVaney farm such that a summary judgment on the ejectment and
equitable-mortgage claims was improper. Specifically, he
contends that he presented sufficient evidence to support his
equitable-mortgage claim. Further, he contends that his
equitable-mortgage claim is not subject to the Statute of
Frauds. Floyd, on the other hand, contends that the trial
court properly concluded that the Statute of Frauds barred
Alan's claims and also questions the sufficiency of the
evidence submitted by Alan in response to the motion for a
summary judgment.
It is clear from Alan's pleadings and from the arguments
made in this Court and in the trial court that what Alan terms
an "equitable mortgage" is what this court has long recognized
as a "resulting trust in the nature of an equitable mortgage."
"When one person makes a loan to another with
which to purchase lands, and by mutual agreement a
deed is made directly from the vendor to the lender
as security for the loan, the transaction partakes
7
1160851
of the nature both of a resulting trust and a
mortgage. A resulting trust, because the money
loaned becomes that of the borrower, and the title
acquired with his money is taken in the name of
another; a mortgage, because it is given as security
for the debt due from lender to borrower.
"For convenience this court has come to call it
a trust in the nature of an equitable mortgage. For
purposes of equitable relief it is treated as a
mortgage. It is not subject to the statute of
frauds."
O'Rear v. O'Rear, 220 Ala. 85, 86, 123 So. 895, 896 (1929).
Stated another way:
"[W]hen complainant procures a loan of the funds
from respondent, such funds belong to complainant,
although provided by respondent; and that when title
is taken in respondent as security for the loan, the
respondent is held to receive the title in trust,
and as complainant provided the funds it is a
resulting trust in the nature of a mortgage, and the
statute of frauds does not apply."
Pollak v. Millsap, 219 Ala. 273, 276, 122 So. 16, 19 (1928).
See also Dorman v. Knapp, 284 Ala. 387, 390, 225 So. 2d 799,
801-02 (1969); Holman v. Weed, 248 Ala. 179, 181, 26 So. 2d
721, 722 (1946); Leonard v. Duncan, 245 Ala. 320, 322-23, 16
So. 2d 879, 881 (1944); and Gunter v. Jones, 244 Ala. 251,
253, 13 So. 2d 51, 53 (1943).
A resulting trust in the nature of a mortgage arises by
implication of law and is therefore not subject to the Statute
8
1160851
of Frauds. See, e.g., § 19-3B-1301, Ala. Code 1975 ("No trust
concerning lands, except such as results by implication or
construction of law, ... can be created, unless by instrument
in writing ...."); McClellan v. Pennington, 895 So. 2d 892,
897 (Ala. 2004); and Perryman v. Pugh, 269 Ala. 487, 493, 114
So. 2d 253, 259 (1959) ("The equity sought to be enforced
under the trust aspect is one which arises by operation of law
and is not dependent upon a contract; hence, the statute of
frauds is no obstacle to the establishment of such trust.").
In this case, because the Statute of Frauds is not
applicable to a claim seeking a declaration of a trust in the
nature of an equitable mortgage, the summary judgment entered
on that basis was in error.2
Furthermore, nearly every fact relevant to Alan's
counterclaim seeking an equitable mortgage is disputed. Alan
2We note that, in light of the recognition that a trust
in the nature of an equitable mortgage may be proved by parol
evidence, this Court has required that such proof be clear and
convincing. See, e.g., Dorman, 284 Ala. at 391, 225 So. 2d at
802 ("'[T]o entitle a complainant to relief in such cases, the
testimony
must
be
clear,
consistent, strong,
and
convincing.'"
(quoting Knaus v. Dreher, 84 Ala. 319, 319, 4 So. 287, 288
(1888))). We make no comment at this time, however, regarding
the application of this standard to the evidence before the
trial court on summary judgment, and we do not mean to express
any opinion as to the ultimate merits of the case.
9
1160851
maintains that Floyd loaned him the money to purchase the
Hester farm and the DeVaney farm and took the deeds to those
properties as security for the loans. Floyd, on the other
hand, denies the loans all together. Given the elemental
nature of these disputed facts, summary judgment was
inappropriate. See McClellan, 895 So. 2d at 897 (holding that
genuine issues of material fact precluded summary judgment as
to claim of a resulting trust).
IV. Conclusion
Because the Statute of Frauds does not prohibit the
establishment of a resulting trust in the nature of an
equitable mortgage by parol evidence and because there are
genuine issues of material fact regarding whether a resulting
trust in the nature of an equitable mortgage was created, the
summary judgment entered by the trial court was improper.
Accordingly, that judgment is reversed, and the case is
remanded
for
further
proceedings consistent with
this
opinion.
REVERSED AND REMANDED.
Stuart, C.J., and Bolin, Murdock, and Bryan, JJ., concur.
10 | December 15, 2017 |
91bf44ca-d219-4238-aaf1-f4a949214cc6 | Ex parte James Keith Larry. | N/A | 1170099 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1170099
Ex parte James Keith Larry. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF
CRIMINAL APPEALS (In re: James Keith Larry v. State of Alabama) (Lauderdale Circuit
Court: CC-09-538.62; Criminal Appeals :
CR-16-0579).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Murdock, J. - Stuart, C.J., and Bolin, Main, and Bryan, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
l i t a
Clerk, Supreme Court of Alabama | December 8, 2017 |
8bafc740-3342-4bf3-8ead-ba9ebcd5b11e | Linda R. Sully et al. v. Judith W. Thye | N/A | 1160527 | Alabama | Alabama Supreme Court | Rel: December 1, 2017
STATE OF ALABAMA -- JUDICIAL DEPARTMENT
THE SUPREME COURT
OCTOBER TERM, 2017-2018
1160527
Linda R. Sully et al. v. Judith W. Thye (Appeal from
Jefferson Circuit Court, Bessemer Division: CV-16-900221).
SELLERS, Justice.
AFFIRMED. NO OPINION.
See Rule 53(a)(1) and (a)(2)(F), Ala. R. App. P.
Stuart, C.J., and Bolin, Parker, Shaw, Main, Wise, and
Bryan, JJ., concur.
Murdock, J., dissents. | December 1, 2017 |
1a8b014d-1af3-4f0d-b383-8748c54196a5 | Ex parte Jerry M. Blevins. | N/A | 1160312 | Alabama | Alabama Supreme Court | IN THE SUPREME COURT OF ALABAMA
November 22, 2017
1160312
Ex parte Jerry M. Blevins. PETITION FOR WRIT OF MANDAMUS: CIVIL (In re:
Jerry M. Blevins v. Thomas R. Boller, P.C.) (Baldwin Circuit Court: CV-15-901217;
Civil Appeals :
2150969).
ORDER
The petition for writ of mandamus in this cause is denied.
WISE, J. - Stuart, C.J., and Bolin, Shaw, Main, Bryan, and Sellers, JJ., concur.
I, Julia Jordan Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the
foregoing is a full, true, and correct copy of the instrument(s) herewith set out as same
appear(s) of record in said Court.
Witness my hand this 22nd day of November, 2017.
/ma | November 22, 2017 |
bf20ad84-5871-4f4a-9331-35186e82af46 | Ex Parte Windom | 763 So. 2d 946 | 1990279 | Alabama | Alabama Supreme Court | 763 So. 2d 946 (2000)
Ex parte Stephen R. WINDOM.
(Re Garfield W. Ivey, Jr. v. Stephen R. Windom et al).
1990279.
Supreme Court of Alabama.
February 11, 2000.
*948 Larry U. Sims, Charles H. Dodson, Jr., and Joseph D. Steadman of Helmsing, Sims & Leach, P.C., Mobile, for petitioner.
Barry A. Radsdale of Ivey & Ragsdale, Birmingham, for respondent.
ENGLAND, Justice.
Stephen R. Windom, a defendant in a civil action pending in the Walker Circuit Court, seeks a writ of mandamus directing Judge Hugh Beaird to stay discovery in that action. Windom wants discovery stayed pending a ruling on his motion to transfer that case and pending the criminal trial of Garfield W. Ivey, Jr., who is the plaintiff in the civil action against Windom.
During Windom's 1998 campaign for Lieutenant Governor, Melissa Myers Bush, a Mobile resident, sued him, claiming that he had sexually assaulted her while she was working as a prostitute. Windom in turn sued Bush and a person named Scott Nordness. Windom alleged that Nordness had paid Bush to give false testimony against Windom. He also alleged that a group of "trial lawyers" had conspired against him in regard to the Bush case and that the hiring of Bush's attorney and the formation of the conspiracy among trial lawyers had been orchestrated by "a prominent trial attorney." News media reported that the lawyer Windom was referring to was Ivey. A Mobile County grand jury began a criminal investigation of whether Ivey may have been involved in the alleged conspiracy.
On August 16, 1999, Ivey filed his action against Windom and several fictitiously named parties. He alleged defamation, abuse of process, and civil extortion. Ivey alleged that Windom had caused false and defamatory statements concerning Ivey to be published; that Windom had abused the legal processes for personal and political goals; and that Windom had used and had attempted to use the criminal investigation for the purpose of extorting money from Ivey as a settlement of a civil matter. On the same day, the grand jury returned an indictment against Ivey charging him with bribery, conspiracy to commit bribery, witness tampering, and criminal defamation.[1]
"Mandamus is the `proper means of review to determine whether a trial court has abused its discretion in ordering discovery, in resolving discovery matters, and in issuing discovery orders so as to prevent an abuse of the discovery process by either party.'" Ex parte Compass Bank, 686 So. 2d 1135, 1137 (Ala.1996), quoting Ex parte Mobile Fixture & Equip. Co., 630 So. 2d 358, 360 (Ala.1993). Mandamus is an extraordinary remedy and one seeking it must show (1) a clear legal right to the order sought; (2) an imperative duty upon the respondent to perform, accompanied by a refusal to do so; (3) a lack of another remedy; and (4) properly invoked jurisdiction of the court. Id. This Court has held:
Id. (citations omitted).
Windom argues that Walker County is a "patently improper" venue for the trial of *949 Ivey's civil action because, he says, none of the defamatory statements that Ivey alleges was made in Walker County. Proper venue for Ivey's action is determined by § 6-3-2(a)(3), Ala. Code 1975. That section provides that personal actions against individuals may be commenced in the county in which the defendant resides or in the county in which the act or omission complained of may have been committed or occurred. This Court has held that in actions in which the plaintiff alleges the publication of libelous matter in a newspaper article, venue lies in the county in which the newspaper is primarily published and not in other places where it is merely circulated. Age-Herald Publishing Co. v. Huddleston, 207 Ala. 40, 92 So. 193 (1921); Ex parte Wilson, 408 So. 2d 94, 97 (Ala.1981); Ex parte Arrington, 599 So. 2d 24, 26 (Ala.1992).
Windom is a resident of Mobile County. Ivey says in his complaint that many of the acts, events, or omissions that he alleges on the part of Windom either were committed against him in Walker County or occurred there. Windom argues that none of the alleged defamatory statements was made in Walker County. Windom filed a motion to transfer Ivey's action, but the trial judge (Judge Beaird) has not ruled on that motion.[2] This Court will not, on a mandamus petition, direct a trial court to take some action it has not refused to take. See Ex parte Price, 698 So. 2d 111, 112 n. 1 (Ala.1997).
There appears to be some dispute about whether some of the statements Ivey complains of were made in Walker County.[3] Therefore, Windom has not shown a clear legal right to an order staying discovery pending a ruling on his motion to transfer. Nor has Windom shown the second requirement for a writ of mandamusan imperative duty upon the respondent judge to perform, accompanied by a refusal to do sobecause the trial judge has not refused to transfer the action. Furthermore, no law requires a trial judge to delay discovery in an action pending a ruling on a motion to transfer. In fact, Ivey contends that one of the purposes for seeking discovery, specifically by deposing Windom, is to obtain information relevant to the motion to transfer and to examine Windom in regard to assertions Windom made in an affidavit in support of the motion to transfer. At a minimum, Ivey is entitled to obtain discovery regarding the statements made in Windom's affidavit, which was attached to the motion to transfer. We cannot say that the trial judge abused his discretion in denying the motion to stay discovery pending his ruling on the motion to transfer.
Windom also argues that the trial court should have stayed discovery in Ivey's civil action pending a resolution of the criminal case against Ivey. Windom contends that Ivey's discovery in the civil case will be aimed at securing depositions of prosecution witnesses, harassing the victim of the crime by deposing Windom and his former attorney, and interfering with the criminal trial by using news media to expose potential jurors to information disclosed by the civil discovery.
*950 Rule 26(c), Ala. R. Civ.P., gives the trial court discretion to postpone discovery in a civil action when justice requires a postponement in order "to protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense." This Court has, in similar situations, refused to require a trial court to stay discovery in a civil case, or stay a civil proceeding entirely, pending resolution of a criminal case. See Ex parte McMahan, 507 So. 2d 492 (Ala.1987) (writ of mandamus issued after this Court concluded that the trial court had abused its discretion by staying all forms of discovery in a civil case during pendency of a related criminal case); Ex parte Price, 698 So. 2d 111 (Ala. 1997)(Court denied a writ of mandamus requested by an attorney who had been denied a stay of civil proceedings pending resolution of a criminal investigation of him, holding that his Fifth Amendment rights could be adequately protected while the civil case proceeded in some limited way); and Ex parte Weems, 711 So. 2d 1011 (Ala.1998)(Court denied a writ of mandamus, holding that pending criminal and civil actions were not parallel proceedings and, thus, that a stay of discovery in the civil action was not necessary to protect the petitioner's Fifth Amendment right against self-incrimination).
The criminal action against Ivey and Ivey's civil action against Windom are separate actions, even though they may arise from the same set of facts. Neither pending action involves any Fifth Amendment right against self-incrimination on the part of Windom that could be violated by the court's allowing the parties in the civil action to proceed with discovery. Ivey has waived his Fifth Amendment right against self-incrimination. "[T]he Fifth Amendment does not mandate a stay of civil proceedings pending the outcome of criminal proceedings; whether to grant a stay, based on a balancing of the interests of the partiesi.e., contrasting the interest of a party in postponing the civil proceedings with the possible prejudice to the party who wishes the litigation to go forward is within the trial court's discretion." Ex parte Pegram, 646 So. 2d 644, 645-46 (Ala.1994) This Court cannot issue a writ of mandamus based upon the allegation of one party to a civil action that the other party may in that civil action use the discovery process to interfere with a pending criminal proceeding. The trial court has broad powers to control the use of the discovery process. Ex parte Steiner, 730 So. 2d 599, 600 (Ala.1998). Windom has not shown that the trial judge abused his discretion in denying Windom's motion to stay discovery in the civil case pending resolution of Ivey's criminal case. Therefore, the petition for the writ of mandamus is denied.
PETITION DENIED.
MADDOX, COOK, BROWN, and JOHNSTONE, JJ., concur.
HOUSTON and SEE, JJ., concur specially.
LYONS, J., recuses himself.
SEE, Justice (concurring specially).
Given the disputed issues of fact concerning whether Walker County is a proper venue for Ivey's civil action, I must conclude that Ivey is entitled to conduct limited discovery with respect to the question of proper venue, so that the trial court can determine whether the case should proceed in Walker County. See Ex parte McMahan, 507 So. 2d 492, 493 (Ala.1987). The petitioner Windom has not made a clear showing that the trial court abused its discretion in not ruling on his motion to transfer (a motion based on claims of improper venue, Ala.Code 1975, § 6-2-3, and, alternatively, the doctrine of forum non conveniens, § 6-3-21.1) or in denying his motion to stay all discovery pending a ruling on that motion; therefore, I must concur in denying the petition for the writ of mandamus. See Ex parte Nichols, 757 So. 2d 374 (Ala.1999); Ex parte Children's *951 Hosp. of Alabama, 721 So. 2d 184, 186 (Ala. 1998).
HOUSTON, J., concurs.
[1] A trial on that indictment was set for December 8, 1999, in Mobile County. However, the trial was delayed when the trial judge recused himself from the case.
[2] At a hearing on November 3, 1999, the following conversation occurred regarding Windom's motion to transfer:
"[WINDOM'S ATTORNEY]: And Your Honor indicated that you did not wish to rule or would not rule on [the motion to transfer] until after the new year, is my understanding.
"THE COURT: That's correct. Here's what I told you folks, and here's what I told the other people: Just because two lawyers in Alabama have a disagreement, that doesn't mean I'm going to drop all my cases and take care of them and run them ahead of everybody else, and that's the same way with my motion docket. We got one everythe first Wednesday in every month, and I ask the clerk to put so many on and I figure that it will be, you know, then until we get a chance to hear the motion."
[3] The statements by Windom alleged in Ivey's complaint were published in a Jasper newspaper; Jasper is located in Walker County. | February 11, 2000 |
5736e129-f113-4bf2-9bfd-c0f1baad3960 | Ex parte Jonathan Fuller. | N/A | 1161176 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1161176
Ex parte Jonathan Fuller. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF CIVIL
APPEALS (In re: Jonathan Fuller v. Alabama School of Fine Arts) (: § 16-24C-16, Ala. Code
1975; Civil Appeals :
2160201).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Wise, J. - Stuart, C.J., and Parker, Shaw, and Sellers, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
l i t a
Clerk, Supreme Court of Alabama | December 8, 2017 |
123778bd-cdb2-414b-9475-9c3f80ef8912 | Mitchell's Contracting Service, LLC v. Gleason | N/A | 1160376 | Alabama | Alabama Supreme Court | Rel: December 8, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334)
229-0649), of any typographical or other errors, in order that corrections may be made
before the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
_________________________
1160376
_________________________
Mitchell's Contracting Service, LLC
v.
Robert Guy Gleason, Sr., as administrator of the Estate of
Lorena Gleason, deceased
Appeal from Wilcox Circuit Court
(CV-13-900076)
SELLERS, Justice.
Mitchell's
Contracting
Service,
LLC
("Mitchell"),
appeals
from the Wilcox Circuit Court's denial of Mitchell's renewed
motion for a judgment as a matter of law or for a new trial in
a wrongful-death action brought by Robert Guy Gleason, Sr., as
1160376
the administrator of the estate of Lorena Gleason, deceased.
We reverse the trial court's judgment and remand the cause for
a new trial.
Introduction
According to Gleason's complaint as amended, James
Pettway and Derrick Turner were both driving dump trucks in
their capacities as employees of Mitchell when one of the
trucks caused Lorena's vehicle to leave the road, where it
collided with a tree, resulting in her death. Gleason
asserted claims against Mitchell based on vicarious liability
for Pettway's or Turner's negligent and wanton acts and
omissions. A jury returned a verdict in favor of Gleason for
$2.5 million. The trial court entered a judgment on that
verdict and denied Mitchell's postjudgment motion. This
appeal followed.
Timeliness of Appeal
As an initial matter, we must consider Gleason's argument
that Mitchell's appeal was not timely filed. After the trial
court entered a judgment on the jury's verdict, Mitchell, on
October 19, 2016, filed a renewed "Motion for Judgment as a
Matter of Law, and Motion to Alter, Amend or Vacate the
2
1160376
Judgment, or in the Alternative, Motion for New Trial." In
its motion, Mitchell argued that it was entitled to a judgment
as a matter of law because, Mitchell asserted, Gleason had not
presented sufficient evidence in support of his claim.
Alternatively, Mitchell argued that it was entitled to a new
trial based on the trial court's allegedly improper
evidentiary rulings and other alleged errors.
On October 24, 2016, the trial court entered an order
stating:
"MOTION FOR JUDGMENT AS A MATTER OF LAW, AND MOTION
TO ALTER, AMEND OR VACATE THE JUDGMENT, OR IN THE
[sic] filed by MITCHELL’S CONTRACTING SERVICE, LLC
is hereby DENIED."
(Capitalization in original.) Approximately one week later,
the trial court entered a second order, stating: "The Court's
10-24-16 order denying defendant's motion to alter or amend is
hereby vacated and set aside as it was done in error." The
second order also set a hearing date, stating: "A Hearing on
the Motion is set on 12-16-16." Thereafter, the parties
stipulated that no hearing would be necessary. Accordingly,
the trial court canceled the hearing. The trial court never
entered another order ruling on Mitchell's postjudgment
motion, and the parties considered it to have been denied by
3
1160376
operation of law 90 days after it was filed, i.e., on January
17, 2017. See Rule 59.1, Ala. R. Civ. P.
In response to a show-cause order issued by this Court on
the question of the timeliness of the appeal, filed on January
30, 2017, Gleason argues that the trial court's October 24,
2016, order constituted a final judgment adjudicating
Mitchell's postjudgment motion in its entirety. In support of
his contention, Gleason argues that the trial court did not
have jurisdiction to set aside its order a week after it
entered it; that Mitchell's deadline to appeal began to run on
October 24, 2016; and, thus, that its appeal, filed on January
30, 2017, was untimely. See, e.g., Southeast Envtl.
Infrastructure, LLC v. Rivers, 12 So. 3d 32 (Ala. 2008)
(indicating that a trial court does not have jurisdiction to
"reconsider" a postjudgment motion once the motion is
denied);
and Attalla Health Care, Inc. v. Kimble, 14 So. 3d 883 (Ala.
Civ. App. 2008) (indicating that a trial court does not have
jurisdiction to, sua sponte, set aside an order denying a
postjudgment motion). Mitchell, on the other hand, argues
that the October 24, 2016, order did not completely resolve
4
1160376
the postjudgment motion because, it says, the order did not
rule on Mitchell's request for a new trial.
The legal effect of a judgment is to be declared in light
of the literal meaning of the language of the judgment.
Southeast Constr., LLC v. WAR Constr., Inc., 159 So. 3d 1227,
1238 (Ala. 2014). By its literal language, the October 24,
2016, order does not rule on Mitchell's motion for a new
trial. It simply includes the superfluous words "or in the"
following the two types of motions specifically mentioned.
See also Rule 58(b), Ala. R. Civ. P. ("A written order or a
judgment will be sufficient if it is signed or initialed by
the judge, ... and indicates an intention to adjudicate,
considering the whole record, and if it indicates the
substance of
the
adjudication."
(emphasis
added));
and
Carroll
v. Buttram, 758 So. 2d 1097, 1102 (Ala. 1999) ("A judgment
must be clear and unambiguous in order to stand."). The
language "or in the" was not sufficient to indicate an intent
to deny Mitchell's motion for a new trial. Accordingly, the
trial court's order of October 24, 2016, did not deny
5
1160376
Mitchell's postjudgment motion in its entirety and Mitchell's
appeal was timely filed.1
Facts
On the day of the accident, Mitchell, pursuant to a
contract with the owner of a paper mill in Wilcox County, was
engaged in transporting wood ash from the paper mill to a dump
site southeast of the paper mill. Wilmar Contracting Company
("Wilmar"), who Mitchell's corporate representative described
as
Mitchell's
subcontractor, was
also
involved
in
transporting
ash to the dump site. Some of the dump-truck drivers
transporting ash were employed by Mitchell and some were
employed by Wilmar.
After loading their dump trucks, the dump-truck drivers
would leave the paper mill and travel south along a state
highway. They would then turn onto Wilcox County Road 12 and
travel west toward the dump site. The accident occurred on
1Gleason provides this Court with a "screen shot"
allegedly generated by Alabama's electronic-filing system
that, Gleason asserts, demonstrates that the trial court
denied Mitchell's postjudgment motion in its entirety. The
screen shot submitted by Gleason references the postjudgment
motion and identifies its "disposition" as "denied." The
screen shot, however, does not appear in the appellate record.
Moreover, the Court does not agree that the status of the
motion identified by the electronic-filing system should
control over the language of the order itself.
6
1160376
County Road 12, which was described during the trial as a
narrow two-lane road.
Wilmar dump-truck drivers Raymond Lovelace and Steve
Maness each testified that, after delivering loads of ash to
the dump site on the morning of the accident, they were
traveling east on County Road 12 toward the state highway, en
route to the paper mill. Lovelace testified that a loaded
white dump truck passed him traveling in the opposite
direction on its way to the dump site; that the white dump
truck was not entirely within its lane; and that Lovelace had
to move his dump truck over to allow the white dump truck to
pass safely. Maness testified that he too encountered a white
dump truck traveling west along County Road 12 toward the dump
site. Lovelace confirmed that the white dump truck was one of
the trucks being operated by Mitchell. Mitchell's principal
member, who testified as its representative, stated that
Derrick Turner, who was an employee of Mitchell, was driving
a white dump truck on the day of the accident.
Both Lovelace and Maness testified that there was not a
car resting against the tree off County Road 12 where Lorena's
car was found when they drove east along County Road 12. They
7
1160376
did, however, testify that another driver, Daniel Hunter,2 who
was also traveling east along County Road 12 at a distance
behind Lovelace and Maness, telephoned each of them and
indicated that he had seen that a car appeared to have left
the road and was resting against a tree.
Lovelace testified that the white dump truck he
encountered was the only dump truck he met on County Road 12
before Hunter informed him that Hunter had seen what turned
out to be Lorena's car resting against a tree. Maness
testified that he encountered two dump trucks as he was
traveling east on County Road 12--the white truck and a black
truck, which was also a Mitchell truck. Mitchell's
representative testified that Mitchell employee James Pettway
was driving a black dump truck on the day of the accident.
Hunter testified that, after he had delivered a load of
ash to the dump site, he was traveling east along County Road
12 when a white dump truck passed him traveling in the
opposite direction. He stated that he had personal knowledge
of the truck and that he had no doubt that it was a truck
being operated by a driver employed by Mitchell. Hunter
2It is not clear which entity--Mitchell or Wilmar--Hunter
was working for on the day of the accident.
8
1160376
testified that the truck was traveling at an excessive rate of
speed, that the truck was traveling in the middle of the two-
lane road, and that Hunter had to move his truck off the road
to allow the truck to pass. According to Hunter, after the
white dump truck passed him, he discovered Lorena's car
against a tree and telephoned 911 emergency service. He also
testified that he believed the accident had occurred recently
because "smoke" was still coming out from under the hood of
Lorena's car and because Lovelace, who was traveling in front
of Hunter, had not seen the car.
Andrew
Webb,
Gleason's
accident
reconstructionist,
testified that Lorena was traveling east on County Road 12
when she left the roadway onto the south-side shoulder, that
she attempted to maneuver her vehicle back onto the road, that
she over-corrected to the north side, that she lost control of
her vehicle, and that her vehicle crossed over the road onto
the north-side shoulder and struck a tree. Webb opined that
Lorena had engaged in an avoidance maneuver in driving off the
road onto the south-side shoulder and that there was no
evidence of distracted driving on Lorena's part. He also
opined that Lorena's vehicle struck the tree while traveling
9
1160376
approximately 18 miles per hour. Photographs admitted into
evidence show that the tree is relatively close to the north-
side
shoulder
of
the
road.
Mitchell's
accident
reconstructionist agreed that Lorena had originally left the
road onto the south-side shoulder and that she lost control of
the vehicle when she over-corrected in an attempt to move the
car back onto the road. He testified, however, that the
evidence was consistent with distracted driving.
Agee Smith testified that he witnessed a white dump truck
force Lorena's vehicle off County Road 12:
"Q [By Gleason's attorney]. Now, Mr. Smith, on [the
day of the accident], you were in Coy[, Alabama,] on
that date?
"A. Oh, yes, sir.
"Q. Are you -- where were you in Coy?
"A. I was traveling on County Road 12, but it be
coming from my farm. It would be kind of east like
northeast.
"Q. And what happened when you -- you said you made
it to the stop sign?
"A. As I approached on towards the stop sign, which
would be down below the fire department, traveling
on County Road 12. And we went on -- I was turning
north a little bit and still traveling on County
Road 12, and I was coming around this curve --
coming around the curve. I saw the little car kind
of flank a little bit. And I said, well, what's
10
1160376
going on? And as I was going on up, I could see this
body of this big truck coming. And the big truck on
the little small vehicle, it had it going on the
side of the highway, it was all the way over cross
the line, it was across the dividing line in the
highway. It was on --
"Q. Will you tell the jury what kind of big truck
you saw?
"A. It was a big dump truck. It was a big dump
truck. And, you know, it was hauling some kind of
soil, I believe.
"Q. And will you tell the jury, you said it was
straddling the road. You mean, it was not in its
lane.
"A. It was not in its lane. As I go to say, there
was a northbound lane, so the truck was all in the
northbound lane when it should have been -- you
know, it was southbound, but it was in the
northbound lane when it should have been in the
southbound lane.[3]
"Q. And was there a vehicle in front of you? You was
saying some little vehicle. Do you know what color
it was? Can you describe it?
"A. It was a little red -- little red vehicle, and
I saw a struggle with the vehicle. I saw somebody --
I felt that they was fighting, I guess, for their
life or fighting to get the vehicle under control.
But seconds after then, when I looked over, the
vehicle jumped across the -- after the big truck
zoomed on, the vehicle across -- I guess, it was
trying to, you know, take control of the vehicle,
whoever was driving the vehicle, but it didn't
3It appears that the portion of County Road 12 the dump
trucks were using travels primarily east and west, although
parts of it travel north and south.
11
1160376
happen. It was a big oak tree when it went across
the -- it went across after the -- after the big
dump truck had passed by, that's where they -- it
went across. The big dump truck gone on. And,
myself, I didn't go up to the vehicle. I was
thinking things. I saw things coming from the
vehicle, but it was the steam coming from the
radiator.
"....
"Q. Now let's go back.
"A. Okay --
"Q. You say you saw the big truck on the wrong side
of the road.
"A. Yes.
"Q. And you saw the red car leave the road.
"A. That's right.
"Q. And you saw it come back on the road and land[]
on this big oak tree; is that right?
"A. Yes. Landed on the big oak tree which would be
to my left.
"Q. But you saw this big dump truck on the wrong,
side of the road.
"A. Yes.
"Q. Was it green, red, black, or -- what color now?
"A. White.
"Q. White. So you saw a white dump trunk; is that
right?
12
1160376
"A. Yeah."
Mitchell truck drivers Derrick Turner and James Pettway
each testified that they were driving trucks on the route in
question on the day of the accident and that, as they were
traveling west on County Road 12 toward the dump site, they
saw Lorena's car resting against a tree. They both denied
that they had caused her car to leave the roadway.
Discussion
Judgment as a Matter of Law
Mitchell asserts that Gleason did not establish that
Lorena's death was proximately caused by one of its drivers
because, Mitchell argues, there is no evidence indicating that
a truck driven by a Mitchell employee forced Lorena's vehicle
off the road.
"'The standard of review applicable to
a ruling on a motion for [a judgment as a
matter of law] is identical to the standard
used by the trial court in granting or
denying [that motion]. Thus, in reviewing
the trial court's ruling on the motion, we
review the evidence in a light most
favorable
to
the
nonmovant,
and
we
determine whether the party with the burden
of proof has produced sufficient evidence
to require a jury determination.
"'....
13
1160376
"'... In ruling on a motion for a
[judgment as a matter of law], the trial
court is called upon to determine whether
the evidence was sufficient to submit a
question of fact to the jury; for the court
to determine that it was, there must have
been
"substantial
evidence"
before
the
jury
to
create
a
question
of
fact.
"[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."'
"American Nat'l Fire Ins. Co. v. Hughes, 624 So. 2d
1362, 1366–67 (Ala. 1993). (Citations omitted.)."
Acceptance Ins. Co. v. Brown, 832 So. 2d 1, 12 (Ala. 2001).
It is not our role to reweigh the evidence. General
Motors Corp. v. Jernigan, 883 So. 2d 646, 669 (Ala. 2003).
Thus, the question for this Court to answer is not what
conclusion its members would have reached had they been on the
jury that heard the case. Rather, the issue is whether from
the evidence presented "'"fair-minded persons in the exercise
of impartial judgment [could] reasonably infer the existence
of the fact sought to be proved."'" Acceptance Ins. Co., 832
So. 2d at 12 (quoting American Nat'l Fire Ins. Co. v. Hughes,
624 So. 2d 1362, 1367 (Ala. 1993)).
Mitchell asserts that Gleason's theory of the case was
based entirely on speculation because no one, including Agee
14
1160376
Smith, testified that he or she witnessed a Mitchell dump
truck force Lorena's vehicle off the road. The testimony,
however, was sufficient to allow a fair-minded person to
conclude that Lorena was forced off the road by a white dump
truck traveling in the opposite direction and that the only
dump truck in the area during the relevant time frame fitting
that description was one driven by a driver employed by
Mitchell. Accordingly, we cannot conclude that the trial
court erred in denying Mitchell's motion for a judgment as a
matter of law based on lack of proof that a Mitchell-operated
dump truck caused the accident.4
Mitchell also argues that a judgment as a matter of law
was due to be entered based on Lorena's alleged contributory
negligence in failing to maintain control of the vehicle she
was driving.
"In order to prove contributory negligence, the
defendant must show that the party charged 1) had
knowledge of the 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. Hatton v.
4Mitchell contends that Agee Smith was not a credible
witness. It is the jury's function, however, to judge the
credibility of witnesses. Flint Constr. Co. v. Hall, 904 So.
2d 236, 250 (Ala. 2004).
15
1160376
Chem-Haulers, Inc., 393 So. 2d 950 (Ala. 1980);
Wallace v. Doege, 484 So. 2d 404 (Ala. 1986)."
Rowden v. Tomlinson, 538 So. 2d 15, 18 (Ala. 1988).
"'[I]t must be demonstrated that the plaintiff's
appreciation
of
the
danger
was
a
conscious
appreciation at the moment the incident occurred.
[Citations
omitted.]
Mere
"heedlessness"
is
insufficient to warrant a finding of contributory
negligence as a matter of law. [Citations omitted.]'
Central Alabama Elec. Co-op. v. Tapley, 546 So. 2d
371, 381 (Ala. 1989)."
John R. Cowley & Bros. v. Brown, 569 So. 2d 375, 382 (Ala.
1990).
"Although ordinarily it is a question of fact
for the jury, the question whether a plaintiff is
guilty of contributory negligence becomes a matter
of law, and therefore one for the court to decide,
when the facts are such that all reasonable persons
must draw the same conclusion therefrom. Gross v.
Republic Steel Corp., 400 So. 2d 383 (Ala. 1981)."
Rowden, 538 So. 2d at 18. Based on the applicable standards
and our review of the evidence, this Court cannot determine
that all reasonable persons must conclude that Lorena was
contributorily negligent in not maintaining control of her
vehicle. The trial court did not err in denying Mitchell's
motion for a judgment as a matter of law.
New Trial
16
1160376
Mitchell
asserts
that
Gleason,
in
responding
to
Mitchell's interrogatories, failed to identify Agee Smith as
an eyewitness to the accident and that, as a consequence, the
trial court should have continued the trial to give Mitchell's
counsel an opportunity to depose Smith and to otherwise
prepare for Smith's testimony. Mitchell's interrogatories to
Gleason asked him to identify "any witnesses to the accident
known to [Gleason] or to [his] attorney." Mitchell also asked
Gleason to identify each person with knowledge of the accident
and to state the nature of that knowledge. Gleason did not
identify Smith in his initial responses to Mitchell's
interrogatories. One year later, in June 2015, Gleason
supplemented his responses after the trial court entered an
order compelling him to do so. In his supplemental responses,
Gleason stated that he was unaware of any eyewitnesses to the
accident and that he would further supplement his responses as
more information was obtained. In August 2016, approximately
six weeks before the trial began, Gleason submitted a list of
witnesses who might testify at the trial. Gleason's witness
list identified 21 specific individuals by name and address,
17
1160376
including Smith. The witness list, however, did not indicate
that Smith had actually witnessed the accident.
In support of Mitchell's postjudgment motion, Mitchell's
lead counsel submitted an affidavit averring that, "[a]t the
beginning of the trial, [he] did not know that [Smith] had any
knowledge about the incident." Counsel also averred that,
when Smith entered the courtroom on the day of the trial,
Mitchell's counsel "briefly questioned him about the purpose
of his testimony and was informed that he sought to testify
about his eyewitness accounts of the incident."
After Mitchell objected to Smith's testifying and
requested a continuance, Gleason's counsel informed the trial
court that he had learned of the substance of Smith's
testimony approximately two months before the trial and had
subsequently designated Smith on Gleason's witness list.
Gleason's counsel also asserted that Mitchell's liability
insurer had spoken with Smith in connection with its
investigation of the claim, although there is no evidence
indicating that Smith had informed Mitchell's insurer that he
had witnessed the accident.
18
1160376
Mitchell points to Barganier v. Barganier, 669 So. 2d 933
(Ala. Civ. App. 1995), for the following proposition:
"'"Generally speaking, the purpose of modern
discovery is to assist the administration of
justice, to aid a party in preparing and presenting
his case or his defense, to advance the function of
a trial in ascertaining truth, and to accelerate the
disposition of suits. Beyond this, the rules for
discovery are designed to eliminate, as far as
possible, concealment and surprise in the trial of
lawsuits to the end that judgments be rested upon
the real merits of cases and not upon the skill and
maneuvering of counsel." 23 Am. Jur. 2d, Depositions
and Discovery, § 155 (1965). Stated otherwise, the
rules seek to "make a trial less a game of blind
man's buff and more a fair contest with the basic
issues
and
facts
disclosed
to
the
fullest
practicable extent." United States v. Procter and
Gamble Co., 356 U.S. 677 (1958); Hickman v. Taylor,
329 U.S. 495 (1947).'"
669 So. 2d at 936 (quoting Ex parte Dorsey Trailers, Inc., 397
So. 2d 98, 103 (Ala. 1981)). The Court in Dorsey Trailers,
which the Barganier court quoted, provided a comprehensive
discussion of the Rules of Civil Procedure relating to
discovery and indicated that those rules should be liberally
applied so as to provide for "full disclosure of relevant
information." 397 So. 2d at 103. The Court stated that "a
party has a duty to provide all information available to him."
Id. at 104.
Rule 26(e), Ala. R. Civ. P., provides:
19
1160376
"(e) Supplementation of Responses. A party who
has responded to a request for discovery with a
response that was complete when made is under no
duty
to
supplement
the
response
to
include
information thereafter acquired, except as follows:
"(1) A party is under a duty seasonably to
supplement the response with respect to any question
directly addressed to (A) the identity and location
of persons having knowledge of discoverable matters,
and (B) the identity of each person expected to be
called as an expert witness at trial, the subject
matter on which the expert witness is expected to
testify, and the substance of the witness's
testimony.
"(2) A party is under a duty seasonably to amend
a prior response if the party obtains information
upon the basis of which the party (A) knows that the
response was incorrect when made, or (B) knows that
the response, though correct when made, is no longer
true and the circumstances are such that a failure
to amend the response is in substance a knowing
concealment.
"(3) A duty to supplement responses may be
imposed by order of the court, agreement of the
parties, or at any time prior to trial through new
requests for supplementation of prior responses."
It is not seriously disputed that Gleason failed in his duty
to supplement his responses to Mitchell's interrogatories to
specifically disclose his knowledge that Smith, who would be
testifying as a witness, was an eyewitness to the accident.
Although
trial
courts
are
afforded
considerable
discretion in determining the sanctions for a party's failure
20
1160376
to provide complete and truthful discovery responses, that
discretion is not unlimited. See Edwards v. Valentine, 926
So. 2d 315, 330 (Ala. 2005) (holding that allowing testimony
of a previously undisclosed witness is a matter of discretion,
which, if palpably abused, will result in a reversal of the
judgment on appeal); and Eady v. Friese Materials Corp., 567
So. 2d 857, 858 (Ala. 1990) ("Sanctions for failure to comply
with a pretrial discovery order are within the discretion of
the trial judge and will not be disturbed unless there is an
abuse of discretion.").
We can find no cases where this Court has considered the
consequences
of
a
party's
failure,
in
response
to
interrogatories in a civil action, to disclose the existence
and identity of an eyewitness to an accident that resulted in
death or serious injury preventing the accident victim from
testifying. In this case, Gleason was reminded, if not
directed, by the trial court to supplement his
interrogatories
as appropriate. When Gleason discovered two months before
trial that Smith was an eyewitness to the accident (in fact
the only eyewitness), he had an immediate and affirmative duty
to disclose to Mitchell that Smith had witnessed the accident.
21
1160376
In Evtush v. Hudson Bus Transportation Co., 7 N.J. 167, 81
A.2d 6 (1951), the representatives of two decedents sued the
corporate operator of two buses and the individual drivers of
those buses after the decedents were killed when the
motorcycle they were riding collided with one of the buses.
A response to an interrogatory asking the defendants to
provide the names and addresses of "witnesses to the accident"
identified only the individual bus drivers. During the trial,
however, the defendants called two additional eyewitnesses,
whom the trial court allowed to testify over the plaintiffs'
objections. The jury returned a verdict in favor of the
defendants, and the plaintiffs appealed. Both the New Jersey
intermediate appellate court and the New Jersey Supreme Court
concluded that the trial court had erred in allowing the
witnesses to testify. The New Jersey Supreme Court stated:
"The rules for discovery here involved were
designed
to
eliminate,
as
far
as
possible,
concealment and surprise in the trial of law suits
to the end that judgments therein be rested upon the
real merits of the causes and not upon the skill and
maneuvering of counsel. It necessarily follows, if
such rules are to be effective, that the courts
impose appropriate sanctions for violations thereof.
We
therefore
conclude
that
the
[intermediate
appellate court] was right in reversing the judgment
of the trial court and ordering a new trial, thereby
eliminating the element of surprise which must have
22
1160376
accrued to the benefit of the defendants at the
previous trial because of their infraction of such
rules."
7 N.J. at 173, 81 A.2d at 9.5 See also Outback Steakhouse of
Florida, Inc. v. Markley, 856 N.E.2d 65 (Ind. 2006) (reversing
trial court's refusal to grant defendant restaurant relief
from judgment against restaurant in dram-shop action based in
large part on plaintiff's failure to supplement interrogatory
response so as to inform restaurant that key eyewitness would,
in direct contrast to her deposition testimony, testify during
the trial that she had served restaurant customer alcohol
while he was visibly intoxicated).
In the present case, Smith's testimony obviously was
crucial, because he was the only person who claimed to have
witnessed the accident firsthand. Even though Gleason's
counsel learned of Smith's status as the only eyewitness two
months before the trial started, he failed to inform Mitchell.
Gleason's witness list identified Smith only as a possible
5Although there was some indication in Evtush that the
defendants' failure to disclose the existence of two
additional eyewitnesses to the accident might have been
excused had the
defendants not known the witnesses' identities
at the time the defendants answered the plaintiffs'
interrogatories, we have already determined that Gleason had
a duty to supplement his interrogatory responses once he
learned of the substance of Smith's testimony.
23
1160376
trial witness; it did not disclose the substance of Smith's
proposed testimony. In addition, Gleason provided his
witness
list to Mitchell only after Gleason had previously indicated
that he was unaware of the existence of any eyewitnesses to
the accident. Gleason's lack of candor in failing to
supplement his responses to Mitchell's interrogatories
prevented Mitchell from fully preparing for trial. Thus, it
is clear to this Court that Mitchell was prejudiced initially
by Gleason's failure to disclose that Smith was an eyewitness
to the accident and critically by the trial court's refusal to
continue the trial to allow Mitchell the opportunity to depose
Smith.
Based on all the circumstances, this Court must conclude
that the trial court exceeded its discretion in refusing
Mitchell's request for a continuance. Accordingly, the trial
court's judgment is reversed and the cause is remanded for a
new trial. Because of our holding on this issue, this Court
pretermits
discussion
of
Mitchell's
other
arguments in
support
of its request for a new trial.6
6The Court notes that Mitchell asserts in its initial
brief on appeal that it was entitled to a judgment as a matter
of law based on the trial court's error in allowing Smith to
testify. Mitchell, however, does not develop that argument or
24
1160376
REVERSED AND REMANDED.
Stuart, C.J., and Wise, J., concur.
Sellers, J., concurs specially.
Murdock, J., concurs in part and concurs in the result.
Parker, J., concurs in the result.
Bolin, Shaw, Main, and Bryan, JJ., dissent.
point to any authority supporting it. Moreover, in its reply
brief, Mitchell asserts that the admission of Smith's
testimony necessitates reversal and a new trial, not a
judgment as a matter of law.
25
1160376
SELLERS, Justice (concurring specially).
I concur in the main opinion, which I authored. I
write specially to respectfully respond to Justice Shaw's
dissenting opinion. The legal profession requires its
members
to act professionally. The hallmark of a professional is not
necessarily remuneration or success; rather, it is the
quality of the services provided. Part and parcel of that
quality is professional courtesy to the court, to opposing
counsel, and to the general public.
According to the Committee Comments on 1973 Adoption of
Rule 26, Ala. R. Civ. P., "[t]he purpose of discovery is to
allow a broad search for facts, the names of witnesses, or any
other matters which may aid a party in the presentation of his
case." Notwithstanding the myriad studies on accuracy of
eyewitness accounts, in the hierarchy of witnesses an
eyewitness is at the top. The testimony of someone observing
an accident or the commission of a crime is critical to the
presentation of a case, especially one such as the present
case. Paramount in preparing for trial is identifying
eyewitnesses and the subject matter of their testimony.
26
1160376
In this case, defendant's counsel specifically asked the
plaintiff to identify all eyewitnesses, and he was told the
plaintiff knew of none. Asked to supplement his responses and
compelled to do so by the trial court, the plaintiff again
responded that he knew of no eyewitnesses. Two months before
the trial, the plaintiff discovered that, in fact, there was
an eyewitness to the accident. He did not, however,
supplement his discovery responses. In keeping with the high
standards of professional conduct, plaintiff's counsel had a
duty to inform defense counsel that there was an eyewitness to
the accident; it was not enough to include the witness's name
and address on a general witness list.
Especially in the present case, testimony from an
eyewitness is vastly different from that of an expert witness.
An expert witness gives an opinion that may be refuted, but an
eyewitness gives testimony of actual observation of the
incident giving rise to the litigation. In this case, because
there was only one eyewitness, defense counsel was not
afforded a sufficient opportunity to question the witness's
line of sight or otherwise to prepare to mitigate the impact
27
1160376
of the eyewitness's critical testimony. The prejudice
resulting from plaintiff's failure to disclose is obvious.
Inasmuch as plaintiff's counsel could have prevented that
prejudice by identifying the witness as an eyewitness, the
trial court, by simply allowing a short continuance to give
defense counsel an opportunity to depose the witness, could
have eliminated the prejudice. In my view, the failure to
continue a trial and allow for the deposition of a known, but
undisclosed, eyewitness borders on per se abuse of
discretion.
Rather than requiring defense counsel to further demonstrate
prejudice, we should require plaintiff's counsel to explain
why he failed to give notice of his discovery of an
eyewitness.
28
1160376
MURDOCK, Justice (concurring in part and concurring in the
result).
I fully agree with the analysis in the main opinion on
the primary substantive issue presented. Specifically, I
believe the failure of the plaintiff to disclose the nature of
Agee
Smith's
testimony
clearly
violated
discovery
requirements
and was prejudicial because Smith was the only eyewitness to
testify at trial. Thus, I believe we are compelled under the
particular facts of this case to conclude, as does the main
opinion, that the trial judge exceeded his discretion in not
granting a new trial.
I concur only in the result reached by the main opinion
as to the procedural issue of the timeliness of this appeal.
That is, I believe this appeal is timely, but not for the
reason stated in the main opinion. In particular, I believe
the main opinion places too much reliance on the apparent
omission of certain words following the phrase "or in the" in
the trial court's order and that it is plain that the trial
court intended its October 24 order to dispose of Mitchell's
postjudgment motion in its entirety.
29
1160376
That said, the appeal nonetheless was timely because what
would otherwise have been the trial court's terminal order,
i.e., its order denying Mitchell's postjudgment motion for
relief, remained in the breast of the court for 30 days.
Drennen Motor Co. v. Patrick, 225 Ala. 36, 38, 141 So. 681,
682 (Ala. 1932) ("Until thirty days have elapsed all judgments
by default or nil dicit are within the control of the court,
as often said, are within the breast of the court, and, over
such
judgment
during
such
period,
the
court
has
a
discretionary power, irrevisable by mandamus, or otherwise,
except for abuse of its discretion."). See also, e.g.,
Loggins v. State, 910 So. 2d 146, 148 (Ala. Crim. App. 2005)
("It is well settled that a circuit court generally retains
jurisdiction to modify a judgment for ... 30 days after the
judgment is entered.").7 Accordingly, the trial court had
jurisdiction to correct itself and, in this particular case,
simply to vacate that order a mere week after it was entered.
Accordingly, Mitchell's original postjudgment motion was
7This 30-days-in-the-breast-of-the-court rule would not
apply where a statute or our written rules of court
specifically override that rule, as arguably would be the case
with respect to the 90-day limitation imposed by Rule 59.1,
Ala. R. Civ. P.
30
1160376
reinstated and was not denied until it was denied by operation
of law 90 days after it was filed. The appeal in this case
was filed within 42 days of the expiration of that 90-day
period. Thus, the appeal before us was timely filed.
31
1160376
SHAW, Justice (dissenting).
I respectfully dissent. It is not clear to me that
Mitchell's
Contracting
Service,
LLC
("Mitchell"),
the
defendant below, demonstrated that the trial court exceeded
its discretion in refusing to grant Mitchell's motion for a
new trial.
It appears undisputed that Robert Guy Gleason, Sr., the
plaintiff
below,
failed
to
properly
supplement
his
interrogatory responses and to identify Agee Smith as an
eyewitness to the accident. There is no dispute that Gleason
had the opportunity to do so, although it appears that Smith
was not discovered by Gleason until two months before trial
and
after
the
interrogatory responses and
certain
supplemental
responses had been completed.
However, Smith's name was disclosed on Gleason's witness
list filed some six weeks before trial. Mitchell subsequently
deposed some of the witnesses on that list, but Smith was not
deposed and it is not stated whether any actions were taken by
32
1160376
Mitchell to discover the substance of Smith's proposed
testimony.8
After five witnesses had testified at trial, Mitchell
moved the trial court to continue the trial or to declare a
mistrial. After the motion was denied, Mitchell had the
opportunity to cross-examine Smith.
In the motion for a new trial, Mitchell pointed out
Gleason's failure to supplement his interrogatory responses
and to disclose Smith as a witness to the accident. Mitchell
asserted that, had Smith's status as an eyewitness been
disclosed, Mitchell would have deposed him. Mitchell claimed
that it had been denied the opportunity to depose Smith or to
conduct further investigation to rebut his testimony.
Certainly, it is preferable that a party be able to
depose an opposing witness before trial, and a deposition
better prepares a party to address that witness's subsequent
trial testimony. However, Mitchell did not explain what such
additional discovery could reveal in this case or what portion
of Smith's testimony additional discovery could have rebutted
8There was some indication that Smith had been contacted
by
Mitchell's
insurer's
claim-investigation
service,
but
there
is no evidence substantiating or disproving this.
33
1160376
or called into question. Further, Mitchell did have the
opportunity
to
depose
Smith
before
trial,
although,
admittedly, because of Gleason's failures, Mitchell was not
made aware of how important that deposition might be.
"'[W]e have consistently recognized that the
admission of testimony from witnesses whose identity
may not have been disclosed in accordance with
properly conducted pretrial discovery procedure is
within the trial court's sound discretion.' Coastal
Lumber Co. [v. Johnson,] 669 So. 2d [803,] at 811
[(Ala. 1995)] (emphasis added). 'Absent palpable
abuse of that discretion, the trial court's decision
will not be disturbed on appeal.' Id. See also Crane
v. Rush, 577 So. 2d 851 (Ala. 1991); Erwin v.
Sanders, 294 Ala. 649, 320 So. 2d 662 (1975)."
Edwards v. Valentine, 926 So. 2d 315, 330 (Ala. 2005).
In Erwin v. Sanders, 294 Ala. 649, 320 So. 2d 662 (1975),
this Court held that the trial court did not exceed its
discretion in allowing an expert witness to testify despite
the fact that the expert had not been disclosed by
supplementing interrogatory responses asking for the identity
of any experts. In that case, notice of the witness was given
on the day of trial. See also generally Crane v. Rush, 577
So. 2d 851 (1991). Although I question the decision in Erwin,
in the instant case, unlike in Erwin, Smith's existence as a
witness, albeit not the substance of his testimony, was
34
1160376
disclosed. Given that Smith was identified as a witness six
weeks before trial; that, after Smith's designation, Mitchell
apparently did not attempt to depose him or otherwise discover
the nature of his testimony; and that Mitchell did not
demonstrate how it was prejudiced, I do not believe that the
trial court exceeded its considerable discretion in denying
Mitchell's motion for a new trial.
Bolin and Main, JJ., concur.
35 | December 8, 2017 |
e999076f-5b78-46b3-b671-ca3037a8b985 | Ex parte Ralph T. West. | N/A | 1170075 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1170075
Ex parte Ralph T. West. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF
CRIMINAL APPEALS (In re: Ralph T. West v. State of Alabama) (Mobile Circuit Court:
CC-84-3793.66; Criminal Appeals :
CR-16-0754).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Parker, J. - Stuart, C.J., and Shaw, Wise, and Sellers, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
l i t a
Clerk, Supreme Court of Alabama | December 8, 2017 |
97251a04-f80e-4cce-982f-3bc367e3c1f7 | Ex parte Donald Terry Bearden. | N/A | 1170065 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1170065
Ex parte Donald Terry Bearden. PETITION FOR WRIT OF CERTIORARI TO THE COURT
OF CRIMINAL APPEALS (In re: Donald Terry Bearden v. State of Alabama) (Talladega
District Court: DC-16-330; Criminal Appeals :
CR-15-1491).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Sellers, J. - Stuart, C.J., and Parker, Shaw, and Wise, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
l i t a
Clerk, Supreme Court of Alabama | December 8, 2017 |
90f51d91-50c4-4803-8533-60b2c3a7d77b | Ex parte Jay Cee Maynor. | N/A | 1170018 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1170018
Ex parte Jay Cee Maynor. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF
CRIMINAL APPEALS (In re: Jay Cee Maynor v. State of Alabama) (Cullman Circuit Court:
CC-15-66; CC-15-67; Criminal Appeals :
CR-16-0269).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Main, J. - Stuart, C.J., and Bolin, Murdock, and Bryan, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
l i t a
Clerk, Supreme Court of Alabama | December 8, 2017 |
854bb86c-fee0-44b8-bfbe-858c81a5c2cf | Ex parte Milton Hambright. | N/A | 1170104 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1170104
Ex parte Milton Hambright. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF
CRIMINAL APPEALS (In re: Milton Hambright v. Alabama Board of Pardons and Paroles)
(Montgomery Circuit Court: CV-16-783; Criminal Appeals :
CR-16-0679).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Bolin, J. - Stuart, C.J., and Murdock, Main, and Bryan, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
l i t a
Clerk, Supreme Court of Alabama | December 8, 2017 |
b6354853-4874-495c-866a-c8fabed7f954 | Ex parte Jasen Scott Caradine. | N/A | 1161121 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1161121
Ex parte Jasen Scott Caradine. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF
CRIMINAL APPEALS (In re: Jasen Scott Caradine v. State of Alabama) (Coffee Circuit
Court: CC-14-71; Criminal Appeals :
CR-16-0090).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Murdock, J. - Stuart, C.J., and Bolin, Main, and Bryan, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
l i t a
Clerk, Supreme Court of Alabama | December 8, 2017 |
07cc7794-52f9-4ffa-898b-d79a25da8ee2 | Ex parte Carlton Wayne Holman. | N/A | 1170085 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1170085
Ex parte Carlton Wayne Holman. PETITION FOR WRIT OF CERTIORARI TO THE COURT
OF CRIMINAL APp Ea LS (In re: Carlton Wayne Holman v. State of Alabama) (Lee Circuit
Court: CC-09-620.63; Criminal Appeals :
CR-16-0656).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Bryan, J. - Stuart, C.J., and Bolin, Murdock, and Main, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
l i t a
Clerk, Supreme Court of Alabama | December 8, 2017 |
5d2670ab-d58c-4aa6-bcee-66e970b4deda | Ex parte Johnny Johnson. | N/A | 1170121 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1170121
Ex parte Johnny Johnson. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF
CRIMINAL APPEALS (In re: Johnny Johnson v. State of Alabama) (Escambia Circuit Court:
CC-10-303.76; CC-10-304.76; CC-14-193.74; Criminal Appeals :
CR-16-0854).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Stuart, C.J. - Parker, Shaw, Wise, and Sellers, JJ., concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
l i t a
Clerk, Supreme Court of Alabama | December 8, 2017 |
2c746225-c68c-4f07-af5f-c166113bd12a | Winfrid Waid v. State Farm Mutual Automobile Insurance Company | N/A | 1160661 | Alabama | Alabama Supreme Court | Rel: December 8, 2017
STATE OF ALABAMA -- JUDICIAL DEPARTMENT
THE SUPREME COURT
OCTOBER TERM, 2017-2018
1160661
Winfrid Waid v. State Farm Mutual Automobile Insurance Company
(Appeal from Montgomery Circuit Court: CV-16-900154).
SELLERS, Justice.
AFFIRMED. NO OPINION.
See Rule 53(a)(1) and (a)(2)(F), Ala. R. App. P.
Stuart, C.J., and Parker, Shaw, and Wise, JJ., concur. | December 8, 2017 |
3db739b8-724b-46b0-9dd1-a2c443fa9c66 | Margie Wylie v. Estate of Derrell Cockrell, Timothy Cockrell, Miranda Cockrell, Janet Cockrell, Dakoda Zarlip, and Kanada Zarlip | N/A | 1141405 | Alabama | Alabama Supreme Court | REL: November 17, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
____________________
1141405
____________________
Margie Wylie
v.
Estate of Derrell Cockrell, Timothy Cockrell, Miranda
Cockrell, Janet Cockrell, Dakoda Zarlip, and Kanada Zarlip
Appeal from Montgomery Circuit Court
(CV-13-901826)
On Application for Rehearing
MURDOCK, Justice.
The opinion of September 30, 2016, is withdrawn, and the
following is substituted therefor.
1141405
Margie Wylie appeals from the Montgomery Circuit Court's
affirmance
of
the
Montgomery
Probate
Court's
decision
removing
her as personal representative of the estate of Derrell
Cockrell, appointing a successor personal representative for
the estate, and assessing over $19,000 in costs against Wylie.
We affirm the judgment of the circuit court in part and
reverse it in part.
I. Facts
In 1996, Derrell Cockrell ("Derrell") formed Alabama
Steel Erectors, L.L.C. ("ASE"), a company that constructed
metal buildings. The articles of organization of ASE stated
that Derrell and Wylie were ASE's initial members and that
"[o]perational management in [ASE] shall be solely vested in
Derrell Thomas Cockrell." The articles also stated that
"[r]emaining members shall have the right to continue the
business
of
[ASE]
following
the
death,
retirement,
resignation,
expulsion,
bankruptcy,
or
dissolution of
a
member
or upon the occurrence of any other real event which
terminates the continued membership of a member." The
"operating agreement" of ASE reiterated that Derrell would
have "sole operational authority in [ASE]," but it added that
2
1141405
"the duties of bookkeeping have been assigned to Marge Wylie."
The operating agreement also provided that "both parties shall
not be entitled to one-half of each of the profits from the
operation of [ASE]" and that "the share of profits and losses
shall be determined by the managing partner, Derrell Thomas
Cockrell." According to testimony in the hearing in the
probate court, as well as a 2009 federal tax return for ASE,
Derrell held a 90 percent interest and Wylie held a 10 percent
interest in ASE.
Derrell died on October 4, 2009. On November 30, 2009,
the Montgomery Probate Court issued letters testamentary to
Wylie as personal representative of Derrell's estate.
Derrell's will devised his "house and curtilidge [sic] located
at 463 Larkwood Drive, Montgomery, Alabama," to Karen
Jankowski, a woman described by witnesses in
the
probate-court
hearing as Derrell's girlfriend who had been living with him
before his death. In his will, Derrell left "all [his] guns,
[his] boat and [his] 1996 Pick Up Truck" to his brother, Edwin
Cockrell. The will further provided:
"I hereby give and devise all of the rest,
residue and remainder of all property owned by me or
in which I have an interest, wherever located,
whether real, personal, or mixed, as follows:
3
1141405
"A. A One-fourth share each to Janet Cockrell,
Dakoda Zarlip, and Kanada Zarlip, per stirpes.
"B. A One-fourth share split between Miranda
Cockrell and Timothy Cockrell, per stirpes."
Timothy Cockrell and Janet Cockrell are Derrell's children.
Miranda Cockrell is Timothy's daughter, i.e., Derrell's
granddaughter. The relationship, if any, of Dakoda Zarlip and
Kanada Zarlip to Derrell is not reflected in the record.
Timothy, Janet, Miranda, Dakoda, and Kanada are hereinafter
collectively referred to as the "residuary devisees." We note
that, at some point in the estate-administration proceedings,
the probate court appointed a guardian ad litem to protect the
interests of Miranda, Dakoda, and Kanada, who are minors.
With regard to Wylie's duties as personal representative
of Derrell's estate, the will provided that Derrell
"relieve[d Wylie] ... from making any inventory or
accounting to any person or Court for [her]
administration
of my estate; ... [gave] and
grant[ed] to [Wylie] full power and authority in the
administration of my estate, including full power
and authority to manage, operate or liquidate any
business or businesses in which I may be engaged at
the time of my death, as full to all intents and
purposes as I myself could do, if I were living."
According to testimony from two witnesses at the probate-
court hearing, Wylie approached Timothy at Derrell's funeral
4
1141405
visitation on October 7, 2009 -- before she had been appointed
personal representative of Derrell's estate -- and told him
that he would be getting only $5,000 from Derrell's estate and
that he should sign certain documents to acknowledge his
entitlement to the money. According to the witnesses, Timothy
told Wylie to leave him alone.
On September 26, 2011, Timothy filed a motion in the
probate court pursuant to § 43-2-530, Ala. Code 1975,1 to
require Wylie to file an accounting of the estate.
Wylie dissolved ASE on October 11, 2011.
On October 13, 2011, the probate court entered an order
requiring Wylie to "appear and file an accounting and vouchers
and to give cause ... why [the estate administration] ha[d]
1Section 43-2-530, Ala. Code 1975, provides:
"Any executor or administrator may be required
by citation to file his accounts and vouchers and to
make a settlement, notwithstanding any provision in
any will or other instrument to the contrary; and,
if after service of the citation, he fails to file
his accounts and vouchers for a settlement on the
day named in the citation, the probate court or
other court having jurisdiction of the said estate
may compel him to do so by attachment or may proceed
to state the account against him from the materials
on file or such other information as may be
accessible, charging him with such assets as may
have come to his hands."
5
1141405
not been judicially settled." The probate court reissued
identical orders to Wylie on December 2, 2011, and January 12,
2012, all of which ordered Wylie to provide an accounting with
vouchers of expenses that had been paid by the estate.
Timothy's counsel also made repeated attempts to obtain
vouchers from Wylie's counsel. He wrote letters requesting
such vouchers, and he filed two motions to compel Wylie to
provide vouchers, filed on June 25, 2012, and August 3, 2012,
respectively. Wylie's counsel never provided the vouchers.
On April 3, 2012, Wylie filed what she styled a "Petition
and Accounting for Final Settlement" of Derrell's estate. The
document contained no vouchers documenting expenses paid by
the estate, but it did contain copies of several checks
written on ASE's bank account and signed by Wylie. In fact,
most of the documentation contained in the submission from
Wylie consisted of information about ASE's bank account. This
was a source of repeated confusion in the probate-court
hearing. For example, during one exchange in the hearing, the
guardian ad litem was questioning Wylie about a certain
expense listed in her accounting:
"[Wylie:] That's -- and this was income that was
earned [by ASE] after [Derrell Cockrell's] death.
6
1141405
"[Guardian ad Litem:] But you told the Court it
was estate income when you filed it under oath, the
estate of Derrell Cockrell. You told the Court when
you reported that you had received that for the
benefit of the estate.
"[Wylie's counsel]: Judge, I
don't
know what his
point is. I made the point to the Court, yes, that's
what it says, but that was a mistake. It's for the
company, not the estate. You've got to decide that.
Maybe the Court is going to rule that the assets of
the company are assets of the estate. I don't know.
But he keeps trying to make her say something other
than what the documents are.
"We stipulate to the Court that we included,
maybe erroneously, matters in this accounting that
have to do with the company as opposed to
Mr. Cockrell personally. That's what happened, and
that's what these facts are."
Wylie's counsel stated numerous times in the hearing that he
had "erroneously included in this accounting money and assets
that relate to the business" of ASE. He even admitted that
the accounting "was inaccurate and incomplete," but nothing in
the record indicates that Wylie ever filed anything to correct
the accounting.
Following Wylie's filing, Timothy filed a petition to
remove Wylie as personal representative of Derrell's estate.
On August 30, 2013, the probate court held a hearing on both
Wylie's petition for final settlement and Timothy's petition
to remove Wylie as personal representative. The probate court
7
1141405
heard from four witnesses, with the majority of the testimony
coming from Wylie.
In her testimony, Wylie, among other things, admitted
that she did not open an estate bank account and that she did
not segregate estate funds from ASE's funds. Wylie stated
that she had written checks on ASE's bank account for a total
of $46,000 as repayment for a loan she claimed she had made to
ASE, but she also admitted that the loan was an unsecured debt
and that there was no documentation to support the loan.
Wylie admitted that she paid Jankowski's personal expenses and
debts from ASE's account after Derrell's death. Wylie stated
that she did this because it was what Derrell wanted, despite
the fact that such a request was not included in his will.
Wylie admitted that she gave all the furnishings in the house
to Jankowski because it was her understanding that the will
required this. Wylie stated that she thought that "curtilage"
meant furnishings in the house. Wylie admitted that she did
not consult an attorney to ascertain the meaning of terms in
the will. Wylie admitted that she paid her personal credit-
card bills out of the ASE account following Derrell's death,
claiming that she had purchased supplies for ASE with her
8
1141405
credit card because ASE did not have a corporate credit card.
Wylie further stated that she "was living out of the account"
and that Derrell did the same when he was alive.
According to the accounting Wylie submitted with the
petition for final settlement, ASE had $145,000 in its bank
account at the time of Derrell's death and it received
$206,000 in income in the two years following his death. In
contrast, Wylie testified at trial that
"[t]here wasn't any money in the account when
[Derrell] died except for the $55,000 that was left
in the bank account. And then you subtract what was
the payables from that, and I think it left
something like $10,000. Then we had -- that was in
the account that was available."
Wylie further testified that the only asset ASE had at
Derrell's death was accumulated, undistributed profits of
$9,700. She answered a question as to the value of ASE by
stating that Derrell "had 90 percent interest in the profits
of the company" -- which she asserted were "like 9 - or
$10,000" –- an amount clearly based on ASE's cash on hand
minus its debts at the time of Derrell's death, not its value
as a going concern. Wylie also testified that "the value of
[Derrell's] interest in the business as of the date of his
death ... was like $9,700," and Wylie's counsel stated to the
9
1141405
probate court: "[T]he only thing [Derrell's] estate was
entitled to was the net value of that business on the date of
his death, $9,500."2 Wylie stated that overall she had
distributed $17,000 to the residuary devisees, which she
asserts is more than the amount to which the estate was
entitled.
A federal tax return for the calendar year 2010, filed as
a final return for ASE, reflected on a Schedule K-1 for Wylie
a beginning share of 10 percent of ASE and an ending share of
100 percent. Wylie's personal tax returns for calendar year
2010 also represented that Wylie held ASE as a sole
proprietorship.
On October 9, 2013, the probate court entered an order
denying Wylie's petition for final settlement and
removing her
as personal representative of Derrell's estate. In the order,
the probate court concluded that Wylie had:
"1. ... repeatedly and consistently failed to adhere
to and comply with the lawful Orders of the Judge of
Probate in this matter;
2As discussed further below, these and similar statements
by or on behalf of Wylie fail to reflect that Derrell owned
only a 90% interest in ASE.
10
1141405
"2. ... wasted, misappropriated and/or converted
multiple assets of the Estate to her own use and
benefit or to the use and benefit of others;
"3. ... failed to identify and segregate the assets
of the Estate and failed to open a separate estate
checking account for the deposit of funds of the
Estate of Derrell T. Cockrell, Deceased. [Wylie]
proceeded to commingle Estate assets with the assets
of [ASE], and continued to operate the business of
[ASE] without first identifying and segregating the
cash and other assets which were the property of the
Estate and subject to probate proceedings under the
Will of [Derrell];
"....
"5. ... attempt[ed] to claim and convert the
ownership of the assets of [ASE] to her own use and
benefit, in contravention of the rights of the
beneficiaries under the Will of [Derrell]. In
furtherance of this position, Ms. Wylie has made
affirmative representations in sworn oral testimony
and in written form on personal federal and state
tax returns filed with this Court in which she
stated that she was the sole owner of [ASE] for the
year in which [ASE] was dissolved, and as part of
the dissolution process claimed its assets on her
individual income tax returns for that year, all in
derogation of the terms and conditions of the Will
of [Derrell] and the rights of the beneficiaries
under the Will."
The October 9, 2013, order also appointed a successor personal
representative for the estate and taxed "costs of this
proceeding in the amount of $19,856.20, which includes a
reasonable fee of $18,045.00 for the services of Carl Pilgrim,
11
1141405
Esq., as Guardian ad Litem, ... against the former personal
representative, Margie Wylie."
On October 11, 2013, pursuant to § 12-2-21, Ala. Code
1975, Wylie filed an appeal of the probate court's order to
the Montgomery Circuit Court.3 On September 21, 2015, the
circuit court entered an order affirming the probate court's
October 9, 2013, order. Wylie appealed to this Court. See
Ala. Code 1975, § 12-22-22 ("An appeal to the Supreme Court
may be taken from the judgment of the circuit court on an
appeal brought to such court under the provisions of this
division.").
II. Standard of Review
As this Court recently stated in Hardy ex rel. Estate of
Carter v. Hardin, 200 So. 3d 622 (Ala. 2016):
"The circuit court was sitting as an appellate
court in this case and was bound by the ore tenus
rule. The ore tenus rule required the circuit court
to
defer
to
the
probate
court's
factual
determinations
where
evidence
supported
those
determinations. Specifically, where evidence is
3After she filed her appeal from the probate court to the
circuit court, Wylie also filed a petition to remove the
administration of Derrell's estate to the circuit court. On
October 17, 2013, the circuit court entered an order removing
the estate administration to the circuit court. The issue
whether the estate administration was properly removed to the
circuit court is not before us in this appeal.
12
1141405
presented ore tenus, the findings of the trial court
are presumed correct 'and will not be disturbed on
appeal absent a showing of plain and palpable
error.' Pilalas v. Baldwin Cnty. Sav. & Loan Ass'n,
549 So. 2d 92, 95 (Ala. 1989); see also Williams v.
Thornton, 274 Ala. 143, 144, 145 So. 2d 828, 829
(1962) ('The finding of the Probate Court based on
the examination of witnesses ore tenus is presumed
to be correct, and will not be disturbed by this
court
or
the
Circuit
Court
unless
palpably
erroneous.').
"As this Court stated in Yeager v. Lucy, 998
So. 2d 460 (Ala. 2008):
"'"'The ore tenus rule is grounded upon the
principle that when the trial court hears
oral testimony it has an opportunity to
evaluate the demeanor and credibility of
witnesses.' Hall v. Mazzone, 486 So. 2d
408, 410 (Ala. 1986). The rule applies to
'disputed issues of fact,' whether the
dispute
is based entirely
upon oral
testimony or upon a combination of oral
testimony and documentary evidence. Born
v. Clark, 662 So. 2d 669, 672 (Ala.
1995)."'
"998 So. 2d at 463 (quoting Reed v. Board of Trs.
for Alabama State Univ., 778 So. 2d 791, 795 (Ala.
2000)); see also, e.g., Woods v. Woods, 653 So. 2d
312, 314 (Ala. Civ. App. 1994) ('[I]n determining
the weight to be accorded to the testimony of any
witness, the trial court may consider the demeanor
of the witness and the witness's apparent candor or
evasiveness.... It is not the province of this court
to override the trial court's observations.').
'Under the ore tenus rule, the trial court's
judgment and all implicit findings necessary to
support it carry a presumption of correctness.'
Transamerica Commercial Fin. Corp. v. AmSouth Bank,
608 So. 2d 375, 378 (Ala. 1992). However, '[t]he
13
1141405
ore tenus rule does not extend to cloak with a
presumption
of
correctness
a
trial
judge's
conclusions of law or the incorrect application of
law to the facts.' Waltman v. Rowell, 913 So. 2d
1083, 1086 (Ala. 2005)."
200 So. 3d at 629; see also Womack v. Estate of Womack, 826
So. 2d 138 (Ala. 2002). "This Court '"review[s] the trial
court's conclusions of law and its application of law to the
facts under the de novo standard of review."'" Espinoza v.
Rudolph, 46 So. 3d 403, 412 (Ala. 2010) (quoting Ex parte
J.E., 1 So. 3d 1002, 1008 (Ala. 2008), quoting in turn
Washington v. State, 922 So. 2d 145, 158 (Ala. Crim. App.
2005)).
III. Analysis
A. Wylie's Removal as Personal Representative
Wylie contends that the circuit court erred by affirming
the
probate
court's
order
removing
her
as
personal
representative of the estate. Section 43-2-290, Ala. Code
1975, provides:
"An administrator may be removed, and his
letters revoked for his removal from the state; and
an administrator or executor may be removed and his
letters revoked for any of the following causes:
"(1) Imbecility of
mind;
intemperance;
continued
sickness,
rendering
him
incapable
of the discharge of his duties; or when
14
1141405
from his conduct or character there is
reason to believe that he is not a suitable
person to have the charge and control of
the estate.
"(2) Failure to make and return
inventories or accounts of sale; failure to
make settlements as required by law; or the
failure to do any act as such executor or
administrator, when lawfully required by
the judge of probate.
"(3) The wasting, embezzlement or any
other maladministration of the estate.
"(4) The using of any of the funds of
the estate for his own benefit.
"(5) A sentence of imprisonment in the
penitentiary, county jail or for hard labor
for the county for a term of 12 months or
more."
The probate court had concluded that evidence supported
Wylie's
removal
as
personal
representative
under
subparagraphs
(2), (3), and (4) of § 43-2-290; the circuit court affirmed.
Wylie takes issue with the circuit court's affirmance of
the probate court's decision to remove her as personal
representative because, she says, that decision was based on
a misunderstanding of the facts and the law. Specifically,
Wylie apparently takes the position that, upon Derrell's
death, she became the sole remaining holder of all interests
in ASE, except to the extent of the estate's interest in
15
1141405
whatever profits had been accumulated but not paid out before
Derrell's death. Based on this position, she asserts in her
appellate brief that
"[a] reading of [the probate court's] decision makes
it abundantly clear that the Probate Court concluded
that the assets of [ASE] were assets of [Derrell's]
Estate and that Mrs. Wylie['s] ... management of
[ASE's assets] after [Derrell's] death amounted to
'commingling' of funds and misappropriation of funds
by Mrs. Wylie. It was based, in large part, on that
finding that Mrs. Wylie was removed as [personal
representative]."
Wylie's argument misunderstands the judgments of the
probate court and the circuit court. Both courts clearly
understood that the assets of ASE did not become assets of the
estate at Derrell's death. The probate court specifically
determined that "[Wylie] proceeded to commingle Estate assets
with the assets of [ASE], and continued to operate the
business of [ASE] without first identifying and segregating
the cash and other assets which were the property of the
Estate and subject to probate proceedings under the Will of
[Derrell]." (Emphasis added.) Such findings belie Wylie's
assertion that the probate court thought that the assets of
16
1141405
ASE became the assets of Derrell's estate immediately upon
Derrell's death.4
We also take note of Wylie's argument that "[t]he only
interest that the Estate of Derrell Cockrell had in [ASE] was
the value of [ASE] on the date of his death" and that "the
value of [ASE] at the time of [Derrell's] death was $9,700."
Yet, at trial, Wylie testified that Derrell had only a 90
percent interest in ASE when he died. Likewise, Wylie
testified that "the value of [Derrell's] interest in the
business as of the date of his death ... was like $9,700," a
figure corresponding to 100%, not 90%, of the value of the
undistributed net profits held by ASE at the time of Derrell's
death, not its value as a going concern. It appears that
4Just as the probate court clearly indicated its
understanding that the assets of ASE did not become assets of
Derrell's estate upon his death, it likewise recognized that
the assets of ASE did not become Wylie's assets upon Derrell's
death. In fact, it was Wylie's "attempt to claim and convert
the ownership of the assets of [ASE] to her own use and
benefit, in contravention of the rights of the beneficiaries
under [Derrell's] Will," that was central to the probate
court's judgment. As noted above, ASE did not dissolve upon
Derrell's death. And indeed, Wylie continued to operate ASE
as a going concern for approximately two more years. In so
doing, however -- and this is central to her removal as
personal representative -- Wylie treated that operation and
its profits as if she alone had a financial interest in it, as
opposed to only a 10% interest in it.
17
1141405
Wylie takes the position that ASE had no value as a going
concern at the time of Derrell's death and that the value of
ASE at the time of Derrell's death was merely the value of the
undistributed net profits it held. For the sake of moving
forward, we will assume that Wylie's position is that the
estate had a claim to 90 percent of "the value of [ASE] on the
date of [Derrell's] death," not 100% of that value, and thus
that the estate's interest was limited to 90 percent of
"$9,700," the alleged undistributed profits of ASE at
Derrell's death, not 90 percent of ASE's value as a going
concern. Indeed, we are compelled to the latter conclusion
because Wylie insists she had no duty to account to the
residuary devisees for her operation of ASE after Derrell's
death and that, even if she did mismanage the finances of ASE,
the residuary devisees could not challenge that mismanagement
because it involves property of ASE in which they have no
interest.
We first observe that Wylie failed to provide a complete
and accurate accounting of her handling of the estate. In
failing to do so she violated no less than three orders of the
probate court directing her to provide such an accounting.
18
1141405
This failure to follow multiple orders issued by the probate
court is sufficient in itself under § 43-2-290(2) to remove
Wylie as personal representative of the estate.
Furthermore, in the probate-court hearing, Wylie's
counsel admitted that the accounting Wylie did provide with
her petition for final settlement of the estate was
"inaccurate
and
incomplete"
because
it
contained
documentation
from the business records of ASE instead of documentation
regarding the estate. It is clear from reviewing the
transcript of the probate-court hearing and the accounting
submitted by Wylie that this alleged mistake corresponded with
the probate court's conclusion that Wylie commingled funds of
the estate and of ASE and that, in so doing, she used funds of
the estate for her personal benefit and for the benefit of
others who were not residuary devisees.
In addition, Wylie admitted in her testimony that she
failed to consult an attorney regarding the meaning of terms
used in Derrell's will. This failure led Wylie, for example,
to assume that the word "curtilage" referred to furnishings
in the house, and so she deeded all the furnishings to
Jankowski. Black's Law Dictionary defines "curtilage" as
19
1141405
"[t]he land or yard adjoining a house, usu[ally] within an
enclosure." Black's Law Dictionary (10th ed. 2014).5 The
furnishings should have been part of the residuary estate to
be distributed to the residuary devisees in shares according
to the will. This admitted mistake constituted another
legitimate
reason
for
Wylie's
removal
as
personal
representative.
In other words, based on the foregoing, and regardless of
Wylie's treatment of ASE, the probate court's judgment
removing her as personal representative is due to be affirmed.
Nevertheless we will address Wylie's arguments as to her
handling of ASE following Derrell's death.
In general Wylie's arguments as to her handling of ASE
and its operations following Derrell's death reflect an
incorrect
understanding
of
the
law
regarding
limited-liability
companies. Wylie argues in her appellate brief:
"Since the operating agreement of [ASE] made no
provision about the death of [Derrell] and its
effect on his membership, state law provides that
[Derrell's] membership terminated. Given that the
operating agreement allowed Mrs. Wylie to continue
the business after [Derrell's] death, she became the
5As Black's also suggests, the meaning of "curtilage" may
be broader for Fourth Amendment purposes.
20
1141405
sole member with freedom to operate [ASE] as [she]
saw fit.
"Once [Derrell's] membership in the LLC ceased,
neither his estate nor his heirs became members and
hence had no further interest therein other than the
value of his membership interest on the date of his
death.
"Any claim of misappropriation of assets of the
LLC by its sole member is a claim belonging to the
LLC itself and thus neither a former member nor his
heirs have standing to complain."
(Emphasis added.)
Wylie is correct that, under state law, upon his death
Derrell ceased to be a member of ASE. Section 10A-5-6.06,
Ala. Code 1975, provides, in pertinent part:6
"(b) Subject to contrary provisions in the
operating agreement, or written consent of all
members at the time, a person ceases to be a member
upon the occurrence of one or more of the following
events listed in the following subdivision or
paragraphs:
"....
6The operative limited-liability-company law in this case
is found in § 10A-5-1 et seq., Ala. Code 1975, which governed
limited-liability companies for some time before and at the
time of Derrell's death. We note that, subsequently, in 2014,
the legislature enacted the Alabama Limited Liability Company
Law of 2014, effective January 1, 2015. Act No. 2014–144, Ala.
Acts
2014.
Act
No.
2014–144
updated
Alabama's
limited-liability-company law, repealed existing law in
Chapter 5 of Title 10, and replaced Chapter 5 of Title 10 with
Chapter 5A.
21
1141405
"(3) In the case of a member who is an
individual:
"a. The member dies.
"....
"(e) Upon a member's cessation of membership
each of the following applies:
"(1) The member's governance rights
terminate."
This Court has previously explained:
"The
LLC
Law
distinguishes
between
membership
in
an LLC and 'financial rights' in an LLC. It defines
a 'member' of an LLC as '[a] person reflected in the
required records of a limited liability company as
the owner of some governance rights of a membership
interest
in
the
limited
liability
company.'
§ 10A–5–1.02(7), Ala. Code 1975. 'Governance
rights' are defined as '[a]ll a member's rights as
a member of a limited liability company except
financial rights, including without limitation, the
rights to participate in the management of the
limited liability company and to bind the limited
liability
company
as
provided
in
Section
10A–5–3.03.' § 10A–5–1.02(5), Ala. Code 1975 ....
'Financial rights' are '[r]ights to a. share in
profits
and
losses
as
provided
in
Section
10A–5–5.03, b. receive interim distributions as
provided in Section 10A–5–5.04, and c. receive
termination distributions as provided in Section
10A–5–7.05.' § 10A–5–1.02(3), Ala. Code 1975."
L.B. Whitfield, III Family LLC v. Whitfield, 150 So. 3d 171,
183 (Ala. 2014) (emphasis omitted and emphasis added).
22
1141405
Section 10A-5-6.02, Ala. Code 1975, states, in pertinent
part:
"(a) Except as otherwise provided in the
operating agreement:
"(1) A membership interest in a
limited liability company is assignable in
whole or in part.
"....
"(3) An assignment only entitles the
assignee to the financial rights of the
assignor to the extent assigned."
Section 10A-5-6.04, Ala. Code 1975, states, in pertinent part:
"(a) Except as otherwise provided in the
governing documents:
"(1) If a member who is an individual
dies
or
if
a
court
of
competent
jurisdiction adjudges a member to be
incompetent to manage the member's person
or
property,
the
member's
personal
representative,
conservator,
legal
representative, heirs, or legatees may
exercise all the member's financial rights
for the purpose of settling the member's
estate
or
administering
the
member's
property, including any power the member
had to transfer the membership interest."
In Whitfield, this Court explained that "[s]ection
10A–5–6.04(a)(1) ... [is] concern[ed] with the decedent
member's 'financial rights' as and to the extent those rights
exist apart from other aspects of the membership in the
23
1141405
limited liability company previously held by the decedent."
150 So. 3d at 185 (emphasis omitted).
Under the foregoing law, when Derrell died, his
membership in ASE ceased, but his financial rights in ASE (a
90% interest) passed to his estate, and his personal
representative was empowered to transfer those financial
rights in accordance with the directives in his will.
Derrell's will provided that the residue of his property was
to be divided among the residuary devisees, so Derrell's
financial rights in ASE were due to be transferred to them. 7
Thus, Wylie is correct that the residuary devisees did
not become members of ASE with governance rights and thus did
not have a direct say in how Wylie operated ASE or in her
decision ultimately to dissolve it. But Wylie is incorrect
that the residuary devisees were entitled to only a 90 percent
share of the undistributed "profits" ASE held on the date of
7Although not directly applicable, see note 6, supra, we
note that § 10A-5A-5.02, Ala. Code 1975, of the limited-
liability-company law adopted by the legislature in 2014
states that "[a] transferee has the right to receive, in
accordance with the transfer, distributions to which the
transferor would otherwise be entitled."
24
1141405
Derrell's death.8 As the Whitfield Court noted: "'Financial
rights' are '[r]ights to a. share in profits and losses as
8Pursuant to § 10A-5-7.01, Ala. Code 1975, absent a
provision otherwise in the governing documents, a limited-
liability company continues its existence after the death of
one of its members. If a provision terminating ASE upon the
death of a member had been adopted in the present case, ASE
would have had to be terminated at the time of Derrell's
death, and each member, or his or her estate or heirs, would
be entitled to a termination distribution. But that is not
the case here. (We note that the value of such a termination
distribution, i.e., the value of the decedent member's
interest in the limited-liability company at the time of his
or her death, would typically be more substantial than the
value of some of or all the undistributed "profits" earned by
the company during one or more recent accounting periods.)
Wylie's reliance on Fausak's Tire Center, Inc. v.
Blanchard, 959 So. 2d 1132 (Ala. Civ. App. 2006), is misplaced
for a similar reason. In Fausak's Tire Center, "the evidence
was undisputed that the members of the LLC had orally agreed
that, in the event of a member's death, the LLC would
purchase, and the member's estate would sell, the member's
interest in the LLC." 959 So. 2d at 1144 (emphasis added).
The reason that the Court of Civil Appeals had to confirm the
value of the decedent member's interest in the LLC at the date
of his death was because -- unlike in this case -- the
remaining members of the LLC were going to buy that interest
from the decedent's estate. Indeed, as the members' oral
agreement indicated, and as the trial court in Fausak's Tire
Center concluded without objection: "'The twenty (20%)
percent member ownership interest in [the LLC] the decedent
owned at the time of his death constitutes an asset of the
decedent's estate.'" 959 So. 2d at 1136. Thus, contrary to
Wylie's assertion, Fausak's Tire Center does not stand for the
proposition that the estate of a decedent member of an LLC in
all cases is entitled only to the value of the decedent
member's interest in the LLC at the time of his or her death.
25
1141405
provided
in
Section
10A–5–5.03,[9]
b.
receive
interim
distributions as provided in Section 10A–5–5.04, and c.
receive termination distributions as provided in Section
10A–5–7.05.' § 10A–5–1.02(3), Ala. Code 1975." 150 So. 3d at
183.
It is undisputed that Timothy and the other residuary
devisees did not receive continuing distributions from ASE
(based on Derrell's 90% financial rights) for the period
following Derrell's death through its dissolution in
2011, nor
did they receive a distribution upon the dissolution of ASE.
Instead, Wylie treated ASE as if she became its sole owner
following Derrell's death. Wylie then proceeded to use ASE's
finances to cover her own personal expenses. As the appellees
9Section 10A-5-5.03, Ala. Code 1975, provides:
"The
profits
and
losses,
income,
deductions,
and
credits, and items of income, deduction, and credits
of the limited liability company shall be allocated
among the members in the manner provided in the
operating agreement. If the operating agreement
does not so provide, profits and losses, income,
deductions, and credits, and items of income,
deductions, and credits shall be allocated on the
basis of the pro rata value of the contributions
made by each member to the extent they have been
made and not returned."
26
1141405
note, "[t]his is a blatant conversion of the Estate assets for
personal use."
In short, the evidence in the record and limited-
liability-company law support the probate court's conclusion
that Wylie converted assets of Derrell's estate for her own
use and benefit and for the benefit of others who were not the
residuary devisees and that she commingled funds of ASE and
assets of the estate. Therefore, the circuit court did not
exceed its discretion in affirming the probate court's
decision to remove Wylie as personal representative of
Derrell's estate.
In her application for rehearing, Wylie accuses this
Court of violating appellate-review standards because this
Court addresses certain statutes (discussed above) not
included by the appellees in their arguments to the probate
court, the circuit court, or this Court. She also makes a
generalized assertion that this Court has misapplied certain
statutes governing limited-liability companies.
As to latter assertion, Wylie states:
"1. This Court[] misapplied the law when it held
that, despite its finding that Derrell's membership
interest in ASE terminated upon his death, his
financial rights in ASE were transferred to his
27
1141405
estate and those rights included '"'[r]ights to a.
share in profits and losses as provided in Section
10A-5-5.03, b. receive interim distributions as
provided in Section 10A-5-7.05.' § 10A-5-1.02(3),
Ala. Code 1975." [L.B. Whitfield, III Family LLC v.
Whitfield,] 150 So. 3d [171,] 183 [(Ala. 2014)].'
..."
Although Wylie makes the foregoing general assertion of
error, she fails to demonstrate how this Court misunderstood
or misapplied the statutes she cites or any other statute
discussed in this opinion. Indeed, she appears to concede at
one point that our decision reflects the application of the
principle that, subject to due-process concerns, this Court
"'"will sustain the decision of the trial court if it is right
for any reason, even one not presented by a party or
considered or cited by the trial judge"'" (quoting Wylie's
application for rehearing, quoting Pavilion Dev., L.L.C. v.
JBJ P'ship, 979 So. 2d 24, 43 (Ala. 2007)(Murdock, J.,
concurring specially), quoting, in turn, Ex parte Wiginton,
743 So. 2d 1071, 1072–73 (Ala. 1999)). Nevertheless, Wylie
contends, "this principle of law eviscerates the adversarial
nature of our system of justice" in the present case because
we allegedly relied on arguments, or at least statutes, not
presented by the parties or considered by the judges below.
28
1141405
It was Wylie, however, in her brief on original
submission, not this Court, who cited and discussed the
rationale in Whitfield, and who raised the issue of the proper
application of § 10A-5-6.04, and who discussed "'[f]inancial
rights' [as] defined in § 10A-5-1.02(3)." Likewise, it was
Wylie who argued to the probate court and to the circuit court
that she had no duty to account to the residuary devisees
regarding her treatment of ASE after Derrell's death because,
she posited, the residuary devisees had no
continuing interest
in ASE. The residuary devisee's argued to the contrary,
contending that Wylie had a duty to account to them and that
her mishandling of ASE following Derrell's death (among other
things) had adversely affected their rights. The probate
court and the circuit court -- courts that are presumed to
know and follow the law even if they do not expressly note
every statute or other authority that informs their
understanding -– correctly rejected Wylie's argument. See Ex
parte Atchley, 936 So. 2d 513, 516 (Ala. 2006)("We presume
that trial court judges know and follow the law.").
Our discussion of some authority in addition to that
cited by Wylie or even by the appellees in order to fully
29
1141405
respond to Wylie's arguments as an appellant is not improper
-- it is our obligation. When an appellant presents an
erroneous legal position, it is our duty to exposit the law
applicable to that position and to dispel that error. It is
not for us to publish an opinion truncating our discussion of
the law upon which the bench and bar and public will
thereafter rely simply because the statute that makes the
appellant's argument erroneous has been left out of the
appellate briefs. In Ex parte Hutcherson, 677 So. 2d 1205,
1209 (Ala. 1996), this Court reiterated the basic principle
that, in order to secure a reversal of a judgment, an
appellant must show error. It is our responsibility to
determine whether error has been shown, and in executing that
responsibility our duty is to the law. See United States v.
Rogers, 45 U.S. (4 How.) 567, 572 (1846) (Chief Justice Taney,
speaking for the Court: "It is our duty to expound and
execute the law as we find it.").
"In other words, our duty, first and foremost, is to
the correctness of law. That is not something the
parties ultimately dictate to us.
"'"'Appellate review does not consist of
supine
submission
to
erroneous
legal
concepts .... Our duty is to enunciate the
law on the record facts. Neither the
30
1141405
parties nor the trial judge, by agreement
or by passivity, can force us to abdicate
our appellate responsibility.'"'
"Blue Cross & Blue Shield of Alabama v. Hodurski,
899 So. 2d 949, 960 (Ala. 2004) (quoting Forshey v.
Principi, 284 F.3d 1335, 1357 n. 20 (Fed. Cir.
2002), quoting in turn Empire Life Ins. Co. of
America v. Valdak Corp., 468 F.2d 330, 334 (5th Cir.
1972))."
Ex parte Vanderwall, 201 So. 3d 525, 541 (Ala. 2015)(Murdock,
J.,
concurring specially). Wiley's position is without merit.
B. Payment of the Guardian ad Litem's Fee
Wylie next argues that the circuit court erred in
affirming the probate court's decision requiring Wylie to pay
the guardian ad litem's fee of $18,045. Wylie concedes that
"[t]here is no dispute in this case that the appointment of a
[guardian ad litem] was necessary." She argues, however, that
the fee entered by the probate court was erroneous because,
she contends, "there was never any motion, or evidentiary
submission in the record before the Probate Court requesting
or supporting a fee request from the [guardian ad litem]."
Wylie also observes that the matter was not discussed in the
probate-court hearing held August 30, 2013. Wylie argues that
"[t]o award an $18,000-plus [guardian ad litem's] fee against
31
1141405
Mrs. Wylie without notice, proof, or hearing" violates due
process.10
The law is clear that the probate court had the power to
award a guardian ad litem fee's as part of the costs in the
case. Rule 17(d), Ala. R. Civ. P., provides, in part:
"In all cases in which a guardian ad litem is
required, the court must ascertain a reasonable fee
or compensation to be allowed and paid to such
guardian ad litem for services rendered in such
cause, to be taxed as a part of the costs in such
action, and which is to be paid when collected as
other costs in the action, to such guardian ad
litem."
See Rule 1(a), Ala. R. Civ. P.; see also Committee Comment to
the Amendment to Rule 1(a) effective January 1, 2013 ("[T]he
Rules of Civil Procedure apply in the probate court, when such
application
is
appropriate
and
except
when
particular
statutes
provide otherwise."). And, "[i]t is well settled that '[t]he
matter of the guardian ad litem's fee is within the discretion
of the trial court, subject to correction only for abuse of
discretion.'" Historic Blakeley Found., Inc. v. Williams, 40
So. 3d 698, 704 (Ala. 2009) (quoting Englund v. First Nat'l
Bank of Birmingham, 381 So. 2d 8, 12 (Ala. 1980)).
10In this appeal, Wylie makes no meaningful argument
challenging the award of the guardian ad litem's fee against
her personally.
32
1141405
Wylie is correct, however, that nothing in the submitted
record from the circuit court shows that the guardian ad litem
requested a fee from the probate court, nor does the record
contain any documentation of the time the guardian ad litem
spent working on the case that could justify the amount of the
fee awarded. The probate court's October 9, 2013, order twice
referenced "the Report of the Guardian ad Litem" in
conjunction with the hearing as to Wylie's petition for final
settlement and the residuary devisees' petition to remove
Wylie as personal representative, but nothing in the record or
the appellate briefs suggests that the guardian ad litem had
filed a fee petition or that the guardian ad litem's report
included a fee request with supporting documentation.
Moreover, the residuary devisees, who are appellees in this
case and some of whom are represented by the guardian ad litem
in this appeal, fail to address Wylie's argument as to the
guardian ad litem's fee; they direct us to no evidence in the
record to support the guardian ad litem's fee award; and they
make no assertion that such evidence was presented to the
probate court but not included in the record on appeal.
33
1141405
This Court encountered a circumstance similar to the
present case in Van Schaack v. AmSouth Bank, N.A., 530 So. 2d
740 (Ala. 1988), in which a circuit court awarded $5,000 to
the guardian ad litem in an estate action:
"Our review of the record discloses no evidence
regarding the services performed by the guardian ad
litem other than his presence at the July 21, 1986,
hearing on the Bank's petition for final settlement,
at which he asked several questions of Kathryn
Miree. However, there was no testimony offered at
that hearing concerning the services the guardian ad
litem had performed, nor does the trial court's
order refer to the nature or character of the
services performed by the guardian ad litem. We,
therefore, vacate the judgment as to the guardian ad
litem's fee and instruct that, on remand, an
evidentiary hearing be held for the purpose of
determining a reasonable guardian ad litem fee and
an
order
prepared
setting
forth
'with
some
particularity
the
findings
from
the
evidence
adduced.' Lolley v. Citizens Bank, 494 So. 2d [19,]
21 [(Ala. 1986)]. See also Clement v. Merchants
National Bank of Mobile, [493 So. 2d 1350 (Ala.
1986)]."
530 So. 2d at 750-51.
Similarly, in Wehle v. Bradley, 195 So. 3d 928 (Ala.
2015), this Court found that the evidence in the record in
support of a circuit court's attorney-fee award in an estate
action was lacking. The Court observed that "it does not
appear that the circuit court had an adequate factual record
for making the particular award it made," in part because of
34
1141405
"the lack of any evidence of the time consumed outside
appearances before the circuit court, and no evidence of the
total amount of time consumed both in and out of the
courtroom,"
evidence
that
"typically
is an
important
consideration" in determining an attorney-fee award. 195 So.
3d at 946. The Court also
"emphasize[d] that a 'trial court's order regarding
an attorney fee must allow for meaningful review by
articulating
the
decisions
made,
the
reasons
supporting those decisions, and the performance of
the attorney-fee calculation.' City of Birmingham
[v. Horn], 810 So. 2d [667,] 682 [(Ala. 2001)]. The
circuit court's order in this case, conclusory in
nature, fails to meet this standard."
195 So. 3d at 946. In light of those considerations, the
Wehle Court reversed the circuit court's order insofar as it
determined the amount of the attorney fee and remanded the
case for the circuit court to conduct a hearing concerning the
attorney-fee award and to provide an order that could allow
for meaningful review of the decision.
In light of Van Schaack and Wehle, we reverse the circuit
court's judgment to the extent it affirmed the probate court's
fee award to the guardian ad litem, and we remand the case to
allow whatever further proceedings may be necessary to
establish a proper record and to provide a decision that
35
1141405
allows for a meaningful review of any award to the guardian ad
litem.
IV. Conclusion
The circuit court did not exceed its discretion in
affirming the probate court's decision to remove Wylie as
personal
representative.
The record,
however,
lacks
supporting documentation of the probate court's fee award to
the guardian ad litem, and no order from either the probate
court or the circuit court provides us with sufficient
information to perform a meaningful review of that decision.
We therefore reverse that portion of the circuit court's
judgment affirming that award and remand the case for further
proceedings consistent with this opinion.
APPLICATION OVERRULED; OPINION OF SEPTEMBER 30, 2016,
WITHDRAWN; OPINION SUBSTITUTED; AFFIRMED IN PART; REVERSED IN
PART; AND REMANDED.
Bolin, Shaw, Main, and Bryan, JJ., concur.
36 | November 17, 2017 |
16b4dcb4-166f-4604-945d-0ef709e2f323 | Mazda Motor Corporation v. Jon Hurst and Barbara Hurst, as parents of Natalie J. Hurst, deceased, and Sydney McLemore | N/A | 1140545 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
November 17, 2017
1140545
Mazda Motor Corporation v. Jon Hurst and Barbara Hurst, as parents of Natalie J.
Hurst, deceased, and Sydney McLemore (Appeal from Jefferson Circuit Court, Bessemer
Division: CV-12-900498).
CERTIFICATE OF JUDGMENT
WHEREAS, the ruling on the application for rehearing filed in this case and indicated
below was entered in this cause on November 17, 2017:
Application Overruled. No Opinion. Murdock, J. - Stuart, C.J., and Bolin, Parker, Main,
Wise, Bryan, and Sellers, JJ., concur. Shaw, J., recuses himself.
WHEREAS, the appeal in the above referenced cause has been duly submitted and
considered by the Supreme Court of Alabama and the judgment indicated below was entered
in this cause on July 7, 2017:
Affirmed In Part; Reversed In Part; and Remanded. Murdock, J. - Stuart, C.J., and Bolin,
Wise, and Sellers, JJ., concur. Parker, Main, and Bryan, JJ., concur in part, concur in the
result in part, and dissent in part. Shaw, J., recuses himself.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 17th day of November, 2017.
Clerk, Supreme Court of Alabama | November 17, 2017 |
59f9adc5-cfd3-4af3-a723-c11d9b5b6bf0 | Ex parte M.M. | N/A | 1170068 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1170068
Ex parte M.M. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF CIVIL APPEALS
(In re: M.M. v.S.A.S. and A.W.) (Morgan Juvenile Court: CS-06-83.02; Civil Appeals :
2150961).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Parker, J. - Stuart, C.J., and Shaw, Wise, and Sellers, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
l i t a
Clerk, Supreme Court of Alabama | December 8, 2017 |
77331f95-61e5-490b-aeb0-0749d4c193b0 | Ex parte David Kimbrough. | N/A | 1160936 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1160936
Ex parte David Kimbrough. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF
CRIMINAL APPEALS (In re: David Kimbrough v. Alabama Department of Corrections)
(Montgomery Circuit Court: CV-16-577; Criminal Appeals :
CR-16-0358).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Shaw, J. - Stuart, C.J., and Parker, Wise, and Sellers, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
l i t a
Clerk, Supreme Court of Alabama | December 8, 2017 |
89a2c656-2c92-4dae-bf44-ee93210ca807 | Ex parte Angela McClintock et al. | N/A | 1160782 | Alabama | Alabama Supreme Court | Rel: December 1, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334)
229-0649), of any typographical or other errors, in order that corrections may be made
before the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
_________________________
1160782
_________________________
Ex parte Angela McClintock et al.
PETITION FOR WRIT OF MANDAMUS
(In re: K.H., as parent and next friend of
T.H., a minor; and
T.H., as parent and next friend of
K.W., a deceased minor
v.
Angela McClintock et al.)
(Jefferson Circuit Court, CV-14-900844)
WISE, Justice.
1160782
Angela McClintock, Stephanie Streeter, and Christa
Devaughn (hereinafter referred to collectively as "the
petitioners"), all of whom are employees of the Jefferson
County Department of Human Resources ("JCDHR") and defendants
below, petitioned for a writ of mandamus requesting that this
Court direct the Jefferson Circuit Court to enter a summary
judgment in their favor based on State-agent immunity. We
grant the petition and issue the writ.
Facts and Procedural History
On June 30, 2011, T.H. was charged with third-degree
domestic violence when S.W., T.H.'s mother, filed charges
against her for striking a sibling in the face. On December
21, 2011, T.H. gave birth to K.W. On December 23, 2011, while
T.H. was still in the hospital, T.H.'s grandmother reported to
JCDHR that she had concerns that T.H. would not be able to
care for her new baby, that T.H. had left her father's home,
and that T.H. had a history of running away. After conducting
an investigation, JCDHR allowed T.H. to be discharged from the
hospital to the home of K.M., T.H.'s second cousin.
On December 27, 2011, a social worker with JCDHR
contacted K.M. to schedule a home visit. At that time, K.M.
2
1160782
advised the social worker that T.H. had left with K.W. shortly
after arriving at her house. She also indicated that she
thought that T.H. and K.W. were living with K.W.'s father.
On December 29, 2011, K.H., T.H.'s father, filed a
dependency complaint, seeking custody of K.W. In his
complaint, he alleged:
"[T.H.] is a 15-year old who think[s] she is grown,
she do[es] not want to follow rules. She is real
disrespectful, t[o]ward me, and she do[es] not want
to do anything I say. She is so out of control, and
says I, can't tell her what to do, because she [is]
grown; so that's why I need legal help, before she
get[s] hurt or hurt[s] her baby. Also mother 15
gave birth to a baby boy on 12-21-2011 and ran away
and left baby unattendent [sic]."
On January 4, 2012, K.H. filed a motion to dismiss the
complaint, stating that he had "found [T.H.] and her infant
baby boy and now have them in my care, and if for any reason
she run[s] away, I am to contact Det. Thomas."
On January 20, 2012, Devaughn filed a dependency
complaint as to T.H. and a request for a pickup order for K.W.
She alleged that T.H., who was a minor, was not living with
her custodian, K.H.; that K.H. was being investigated for
abandonment; that T.H. had a history of running away; and that
T.H. had not shown that she could responsibly care for K.W.
3
1160782
K.W. was picked up and placed in the foster home of Dennis
Gilmer on that same date.
K.W. died on February 24, 2012, while in foster care. At
the time of K.W.'s death, McClintock was the director of
JCDHR; Streeter was an assistant director of child welfare for
JCDHR;
and
Devaughn
was
a
child-abuse
and
neglect
investigative worker for JCDHR.
On February 21, 2014, K.H. and T.H. filed a complaint in
the Jefferson Circuit Court against the petitioners, Brandon
Hardin, Dennis Gilmer, and JCDHR.1 They stated claims of
wrongful death of a minor, negligence, wantonness, and
negligent/wanton training and supervision. K.H. and T.H.
alleged
that
the
petitioners had
negligently, wantonly,
and/or
recklessly removed K.W. from T.H.'s custody; that they had
negligently, wantonly, and/or recklessly placed him in
Gilmer's care; and that they had
negligently, wantonly, and/or
recklessly failed to properly train, instruct, and supervise
Gilmer. They also alleged that Gilmer had negligently,
wantonly, or recklessly allowed K.W. to be placed face-down on
1It appears that the claims against Hardin, Gilmer, and
JCDHR were dismissed.
4
1160782
a sheet that was allegedly too large for the mattress in his
crib and that, as a result, K.W. had suffered fatal injuries.
On August 29, 2016, the petitioners filed a motion for a
summary judgment. They argued that they were entitled to
immunity on several bases, including an assertion that they
were entitled to State-agent immunity pursuant to Ex parte
Cranman, 792 So. 2d 392 (Ala. 2000). On March 9, 2017, K.H.
and T.H. filed a motion in opposition to the petitioners'
motion.
The trial court conducted a hearing on the motion for a
summary judgment.2 On February 20, 2017, it denied the
motion. This petition followed.
Standard of Review
"'While the general rule is that the denial of
a motion for summary judgment is not reviewable, the
exception is that the denial of a motion for summary
judgment grounded on a claim of immunity is
reviewable by petition for writ of mandamus.' Ex
parte Rizk, 791 So. 2d 911, 912 (Ala. 2000). A writ
of mandamus is an extraordinary remedy available
only when there is: '(1) a clear legal right 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) the properly invoked jurisdiction of the court.'
2No party has provided a transcript of the hearing for
this Court's review.
5
1160782
Ex parte BOC Group, Inc., 823 So. 2d 1270, 1272
(Ala. 2001)."
Ex parte Nall, 879 So. 2d 541, 543 (Ala. 2003). Also,
"whether review of the denial of a summary-judgment
motion is by a petition for a writ of mandamus or by
permissive appeal, the appellate court's standard of
review remains the same. If there is a genuine
issue as to any material fact on the question
whether the movant is entitled to immunity, then the
moving party is not entitled to a summary judgment.
Rule 56, Ala. R. Civ. P. In determining whether
there is a material fact on the question whether the
movant is entitled to immunity, courts, both trial
and appellate, must view the record in the light
most favorable to the nonmoving party, accord the
nonmoving party all reasonable favorable inferences
from the evidence, and resolve all reasonable doubts
against the moving party, considering only the
evidence before the trial court at the time it
denied the motion for a summary judgment. Ex parte
Rizk, 791 So. 2d 911, 912 (Ala. 2000)."
Ex parte Wood, 852 So. 2d 705, 708 (Ala. 2002).
Discussion
The petitioners argue that the trial court erroneously
denied their motion for a summary judgment. Specifically,
they contend that they presented evidence indicating that they
were "discharging duties imposed on a department or agency by
statute, rule, or regulation" at the time of the actions
challenged in this case. The petitioners also assert that
K.H. and T.H. failed to satisfy their burden of establishing
6
1160782
that one of the exceptions to State-agent immunity applies to
this case. Therefore, the petitioners argue, they are
entitled to State-agent immunity pursuant to Ex
parte Cranman,
supra.
In Ex parte Cranman, the rule governing State-agent
immunity was restated as follows:
"A State agent shall be immune from civil liability
in his or her personal capacity when the conduct
made the basis of the claim against the agent is
based upon the agent's
"(1) formulating plans, policies, or
designs; or
"(2) exercising his or her judgment in
the administration of a department or
agency of government, including, but not
limited to, examples such as:
"(a) making administrative
adjudications;
"(b) allocating resources;
"(c) negotiating contracts;
"(d)
hiring,
firing,
transferring,
assigning,
or
supervising personnel; or
"(3) discharging duties imposed on a
department or agency by statute, rule, or
regulation, insofar as the statute, rule,
or regulation prescribes the manner for
performing the duties and the State agent
performs the duties in that manner; or
7
1160782
"(4)
exercising
judgment
in
the
enforcement of the criminal laws of the
State, including, but not limited to,
law-enforcement officers' arresting or
attempting to arrest persons; or
"(5)
exercising
judgment
in
the
discharge of duties imposed by statute,
rule,
or
regulation
in
releasing
prisoners,
counseling or releasing persons of unsound
mind, or educating students.
"Notwithstanding
anything
to
the
contrary
in
the
foregoing statement of the rule, a State agent shall
not be immune from civil liability in his or her
personal capacity
"(1) when the Constitution or laws of
the United States, or the Constitution of
this State, or laws, rules, or regulations
of this State enacted or promulgated for
the purpose of regulating the activities of
a
governmental
agency
require
otherwise;
or
"(2)
when
the
State
agent
acts
willfully, maliciously, fraudulently, in
bad faith, beyond his or her authority, or
under a mistaken interpretation of the
law."
792 So. 2d at 405. Even though Cranman was a plurality
decision, its restatement of the law as to State-agent
immunity was later adopted by this Court in Ex parte Butts,
775 So. 2d 173 (Ala. 2000). "Once it is determined that
State-agent
immunity
applies,
State-agent
immunity
is
withheld
upon a showing that the State agent acted willfully,
8
1160782
maliciously, fraudulently, in bad faith, or beyond his or her
authority. Cranman, 792 So. 2d at 405." Ex parte Bitel, 45
So. 3d 1252, 1257-58 (Ala. 2010). Also,
"[t]his
Court
has
established
a
'burden-shifting' process when a party raises the
defense of State-agent immunity. Giambrone v.
Douglas, 874 So. 2d 1046, 1052 (Ala. 2003). In
order to claim State-agent immunity, a State agent
bears
the
burden
of
demonstrating
that
the
plaintiff's claims arise from a function that would
entitle the State agent to immunity. Giambrone, 874
So. 2d at 1052; Ex parte Wood, 852 So. 2d 705, 709
(Ala. 2002). If the State agent makes such a
showing, the burden then shifts to the plaintiff to
show
that
the
State
agent
acted
willfully,
maliciously, fraudulently, in bad faith, or beyond
his or her authority. Giambrone, 874 So. 2d at
1052; Wood, 852 So. 2d at 709; Ex parte Davis, 721
So. 2d 685, 689 (Ala. 1998). 'A State agent acts
beyond authority and is therefore not immune when he
or she "fail[s] to discharge duties pursuant to
detailed rules or regulations, such as those stated
on a checklist."' Giambrone, 874 So. 2d at 1052
(quoting Ex parte Butts, 775 So. 2d 173, 178 (Ala.
2000))."
Ex parte Estate of Reynolds, 946 So. 2d 450, 452 (Ala. 2006).
"One of the ways in which a plaintiff can show that
a State agent acted beyond his or her authority is
by proffering evidence that the State agent failed
'"to discharge duties pursuant to detailed rules or
regulations, such as those stated on a checklist."'
Giambrone v. Douglas, 874 So. 2d 1046, 1052 (Ala.
2003) (quoting Ex parte Butts, 775 So. 2d [173,] 178
[(Ala. 2000)])."
Ex parte Kennedy, 992 So. 3d 1276, 1282-83 (Ala. 2008).
9
1160782
The petitioners assert that they are entitled to State-
agent immunity based on category (3) in Cranman --
"discharging duties imposed on a department or agency by
statute, rule, or regulation," 792 So. 2d at 405. K.H. and
T.H. do not refute this assertion in their response to this
Court. We agree with the petitioners and hold that they
satisfied their burden of establishing that they were entitled
to State-agent immunity based on Ex parte Cranman.
Because the petitioners established that they were
entitled to State-agent immunity, the burden then shifted to
K.H. and T.H. to establish that "'one of the two categories of
exceptions to State-agent immunity recognized in Cranman is
applicable.'" Ex parte City of Montgomery, 99 So. 3d 282, 293
(Ala. 2012)(quoting Ex parte Kennedy, 992 So. 2d at 1282).
After the petitioners presented evidence showing that they
would be entitled to State-agent immunity, K.H. and T.H.
argued that the petitioners "acted beyond their authority and
failed to discharge their duties pursuant to the mandatory
rules and regulations of the Alabama Department of Human
Resources which did not leave room for them to exercise any
discretionary or professional judgment regarding the removal
10
1160782
and placement of [K.W.]." Specifically, they contended that
the petitioners violated the allegedly mandatory relative-
placement policy of the Alabama Department of Human Resources
("DHR") and failed to ensure that Gilmer complied with the
requirements set forth in DHR's "Minimum Standards for Foster
Family Homes."
With regard to the relative-placement policy, K.H. and
T.H. cited DHR's "Out-of-Home Care Policies and Procedures"
guidelines for choosing the least restrictive setting for the
placement of children. The portion of the guidelines upon
which K.H. and T.H. rely states, in relevant part:
"When out-of-home care becomes necessary,
children should be placed in the least restrictive
setting. This means the most family-like setting
that can provide the environment and services needed
to serve the child's best interest and special
needs. Relative placement should always be given
first consideration after which foster family care,
group home care, and institutional care, are to be
considered in that order."
Although they cited the guidelines regarding relative
placements and made general allegations that the petitioners
failed to consider T.H.'s grandmother, G.C., and her father,
K.H., as relative placements for K.W., K.H. and T.H. did not
present any actual evidence to support those allegations.
11
1160782
Also, with regard to the foster-family-home policies,
K.H. and T.H. cited to DHR's "Minimum Standards for Foster
Family Homes" guidelines for physical care of children. The
portions of the guidelines upon which they rely state:
"If infants will be placed in the home, the
additional guidelines must be followed:
"(1) Clean, tight fitting crib sheets shall
be provided as frequently as needed.
"(2) An infant shall sleep alone in a crib
until age 18 months. It is strongly
recommended the infant be placed on his or
her side or back or as recommended by a
pediatrician."
K.H. and T.H. asserted:
"Viewing the facts in the light most favorable
to [K.H. and T.H.], a trier-of-fact could reasonably
conclude that Defendants McClintock, Streeter and
Devaughn allowed [K.W.] to be placed into a foster
home without first properly training, instructing or
supervising their staff and/or the foster care
providers on the Minimum Standards for Foster Family
Homes, which resulted in [K.W.] being placed
face-down on a sheet too large for his crib's
mattress,
thereby
posing
the
potential
for
suffocation."
Again, although they cited the guidelines for care of children
by foster families and made general allegations about the
petitioners' actions and/or inactions, K.H. and T.H. did not
present any evidence to support those allegations.
12
1160782
K.H. and T.H. did not present any evidence, much less
substantial evidence, to create a genuine issue of material
fact as to whether the petitioners "'failed "'to discharge
duties pursuant to detailed rules or regulations, such as
those stated on a checklist,'"'" Ex parte City of Montgomery,
99 So. 3d at 294 (quoting other cases), or acted willfully,
maliciously, fraudulently, in bad faith, beyond their
authority, or under a mistaken interpretation of the law.
Because K.H. and T.H. did not demonstrate that one of the
exceptions to State-agent immunity under Ex parte Cranman
applies under the facts of this case, the petitioners are
entitled to State-agent immunity. See Ex parte Jefferson Cty.
Dep't of Human Res., 63 So. 3d 621, 627 (Ala. 2010).
Conclusion
For the above-stated reasons, we conclude that the
petitioners have established that they have a clear legal
right to a summary judgment in their favor based on State-
agent immunity under Ex parte Cranman. Accordingly, we grant
the petition for a writ of mandamus and direct the trial court
to vacate its order denying the petitioners' motion for a
13
1160782
summary judgment and to enter a summary judgment for the
petitioners.
PETITION GRANTED; WRIT ISSUED.
Stuart, C.J., and Bolin, Main, Bryan, and Sellers, JJ.,
concur.
Murdock, J., concurs in the result.
Parker and Shaw, JJ., dissent.
14
1160782
MURDOCK, Justice (concurring in the result).
The third category of Cranman immunity applies to the
discharge of duties imposed by statute, rule, or regulation,
but only "insofar as the statute, rule, or regulation
prescribes the manner for performing the duties and the State
agent performs the duties in that manner." Ex parte Cranman,
792 So. 2d 392, 405 (Ala. 2000). By its terms, this condition
does not appear to be applicable in this case. I do believe,
however, that the actions for which the petitioners are
allegedly liable involve the exercise by those individual
petitioners of discretion in a quintessentially State
function. I therefore concur in the result.
15
1160782
SHAW, Justice (dissenting).
The decision in Ex parte Cranman, 792 So. 2d 392, 405
(Ala. 2000), provides that State agents are immune from civil
liability when the conduct made the basis of the claim against
them is based upon the agents' "discharging duties imposed on
a department or agency by statute, rule, or regulation,
insofar as the statute, rule, or regulation prescribes the
manner for performing the duties and the State agent performs
the duties in that manner." (Emphasis added.) Although the
petition for the writ of mandamus indicates that the State
agents in this case were exercising discretion or judgment and
that they were discharging duties imposed by statutes, rules,
or regulations, the petition does not convince me that those
statutes, rules, or regulations prescribed "the manner for
performing" those duties and that the petitioners were
discharging those duties "in that manner." The petition does
not demonstrate that the burden shifted to K.H. and T.H. to
show that an exception to Ex parte Cranman applies; therefore,
I respectfully dissent.
16 | December 1, 2017 |
7f7b46b3-8e56-491e-8a5b-71bec6c0e19e | Ex parte T. R. S. | N/A | 1170126 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1170126
Ex parte T. R. S. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF CRIMINAL
APPEALS (In re: T. R. S. v. State of Alabama) (Shelby Circuit Court: CC14-177; Criminal
Appeals :
CR-16-0791).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Bolin, J. - Stuart, C.J., and Murdock, Main, and Bryan, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
l i t a
Clerk, Supreme Court of Alabama | December 8, 2017 |
64d67dac-2990-4713-a941-e17ff7fe2fc8 | James Michael Gay and Larry Gene Gay v. Robert Howard Gay and Howard Wayne Gay | N/A | 1160567 | Alabama | Alabama Supreme Court | Rel: November 22, 2017
STATE OF ALABAMA -- JUDICIAL DEPARTMENT
THE SUPREME COURT
OCTOBER TERM, 2017-2018
1160567
James Michael Gay and Larry Gene Gay v. Robert Howard Gay and
Howard Wayne Gay (Appeal from Russell Circuit Court:
CV-17-7).
BRYAN, Justice.
AFFIRMED. NO OPINION.
See Rule 53(a)(1) and (a)(2)(F), Ala. R. App. P.
Stuart, C.J., and Bolin, Parker, Murdock, Shaw, Main,
Wise, and Sellers, JJ., concur. | November 22, 2017 |
ae5ee37e-c74f-4e2b-89a2-674a96dca2af | Ex parte Jack McDonald Calvert. | N/A | 1170137 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1170137
Ex parte Jack McDonald Calvert. PETITION FOR WRIT OF CERTIORARI TO THE COURT
OF CRIMINAL APPEALS (In re: Jack McDonald Calvert v. State of Alabama) (Blount Circuit
Court: CC-11-302; CC-11-303; CC-11-307; CC-11-308; CC-11-310; Criminal Appeals :
CR-16-0836).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Main, J. - Stuart, C.J., and Bolin, Murdock, and Bryan, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
Clerk, Supreme Court of Alabama | December 8, 2017 |
78d0a980-fdac-47ec-9599-378523d4eed7 | Ex parte John Joseph Banville. | N/A | 1170127 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1170127
Ex parte John Joseph Banville. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF
CRIMINAL APPEALS (In re: John Joseph Banville v. State of Alabama) (Morgan Circuit
Court: CC-07-206.61; Criminal Appeals :
CR-15-1384).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Sellers, J. - Stuart, C.J., and Parker, Shaw, and Wise, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
l i t a
Clerk, Supreme Court of Alabama | December 8, 2017 |
54e83d6e-c87a-4021-a274-6b2dfcd155ae | Thomas v. Heard | N/A | 1150118 | Alabama | Alabama Supreme Court | rel: November 3, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
____________________
1150118
____________________
Timothy Joel Thomas
v.
Randell Heard and Donna Heard
Appeal from Geneva Circuit Court
(CV-14-900015)
____________________
1150119
____________________
Timothy Joel Thomas
v.
Laura Wells, as guardian ad litem and next friend of M.A., a
minor
Appeal from Geneva Circuit Court
(CV-13-900145)
On Return to Remand
PER CURIAM.
Timothy Joel Thomas appealed from judgments entered in
favor of Randell Heard and Donna Heard and in favor of Laura
Wells, as guardian ad litem and next friend of M.A., a minor.
The Heards and Wells had separately sued Thomas alleging
negligence and wantonness and seeking to recover damages for
injuries the Heards and M.A. had suffered as the result of an
automobile accident. A jury returned verdicts in favor of
Randell Heard, awarding compensatory damages of $850,000 and
punitive damages of $750,000; in favor of Donna Heard,
awarding
compensatory
damages
of
$450,000
and
punitive
damages
of $750,000; and in favor of Wells, awarding compensatory
damages of $500,000 and punitive damages of $500,000. The
trial court entered judgments on the jury's verdicts. Thomas
argued that the jury's punitive-damages awards were excessive
under the guideposts set out by the United States Supreme
Court in BMW of North America, Inc. v. Gore, 517 U.S. 559
(1996), and the factors set out by this Court in Hammond v.
City of Gadsden, 493 So. 2d 1374 (Ala. 1986), and Green Oil
2
1150118, 1150119
Co. v. Hornsby, 539 So. 2d 218 (Ala. 1989), and requested a
remittitur. The trial court denied Thomas's request for a
remittitur without explaining its reasoning for doing so.
On appeal, this Court affirmed the judgments as to the
compensatory-damages awards but remanded the cases with
instructions for the trial court to enter orders in compliance
with Hammond, 493 So. 2d at 1379 ("[I]t is not only
appropriate, but indeed our duty, to require the trial courts
to reflect in the record the reasons for interfering with a
jury verdict, or refusing to do so, on grounds of
excessiveness of the [punitive] damages."). See Thomas v.
Heard, [Ms. 1150118, March 24, 2017] ___ So. 3d ___ (Ala.
2017). Pursuant to our instructions, the trial court, on May
24, 2017, after conducting a Hammond/Green Oil hearing,
entered identical orders in both cases reaffirming the
punitive-damages awards. The trial court made its return to
this Court. The only issue now before this Court is whether
the
punitive-damages
awards
are,
as
Thomas contends,
excessive. For the reasons given, we conclude that they are
not.
Standard of Review
3
1150118, 1150119
This Court reviews de novo an award of punitive damages.
National Ins. Ass'n v. Sockwell, 829 So. 2d 111, 135 (Ala.
2002).
Discussion
In reviewing a punitive-damages award, we apply the
factors outlined in Green Oil, supra, and Hammond, supra,
within the guideposts set out in Gore, supra, as restated in
State Farm Mutual Automobile Insurance Co. v. Campbell, 538
U.S. 408 (2003).
The
Gore
guideposts
are:
"(1)
the
degree
of
reprehensibility of the defendant's misconduct; (2) the
disparity between the actual or potential harm suffered by the
plaintiff and the punitive damages award; and (3) the
difference between the punitive damages awarded by the jury
and the civil penalties authorized or imposed in comparable
cases." State Farm, 538 U.S. at 418 (citing Gore, 517 U.S. at
575). The Hammond/Green Oil factors are:
"'(1) the reprehensibility of [the defendant's]
conduct;
(2)
the
relationship
of
the
punitive-damages award to the harm that actually
occurred, or is likely to occur, from [the
defendant's] conduct; (3) [the defendant's] profit
from
[his]
misconduct;
(4)
[the
defendant's]
financial position; (5) the cost to [the plaintiff]
of the litigation; (6) whether [the defendant] has
4
1150118, 1150119
been subject to criminal sanctions for similar
conduct; and (7) other civil actions [the defendant]
has been involved in arising out of similar
conduct.'"
Ross v. Rosen–Rager, 67 So. 3d 29, 41–42 (Ala. 2010) (quoting
Shiv–Ram, Inc. v. McCaleb, 892 So. 2d 299, 317 (Ala.
2003)(paraphrasing the Hammond/Green Oil factors)).
In the present case, the trial court stated in its orders
denying Thomas's motion for a remittitur:
"The parties agreed that there were basically
three Hammond issues that applied to this case and
one was not in dispute. The parties agreed that the
difference between compensatory and punitive damages
awarded
by
the
jury
was
not
a
significant
difference, and therefore, this factor is an
indicator that the punitive damage[s] award was
reasonable.
"The two issues counsel focused on in oral
argument were:
"1) The degree of reprehensibility of
the defendant's conduct.
"2) The financial position of the
defendant."
The trial court considered all the Gore and Hammond/Green Oil
factors but determined that only three were applicable.
Thomas has not disputed this aspect of the trial court's
orders. In making his argument that the punitive-damages
awards should be remitted, Thomas addresses only the factors
5
1150118, 1150119
concerning the degree of reprehensibility of his conduct and
his financial position. Accordingly, we will limit our
analysis to the factors identified by the trial court as
applicable in determining whether the awards of punitive
damages were reasonable; nevertheless, our conclusion that no
remittitur is warranted is ultimately based upon a review of
all the relevant factors. See CNH America, LLC v. Ligon
Capital, LLC, 160 So. 3d 1195, 1211 (Ala. 2013)(setting forth
analysis concerning only those Gore and Hammond/Green Oil
factors addressed by the appellant).
First, this Court has recognized that the degree of
reprehensibility of a defendant's conduct "is the single most
important factor in the remittitur analysis."
Pensacola Motor
Sales, Inc. v. Daphne Auto., LLC, 155 So. 3d 930, 949 (Ala.
2013)(citing BMW of North America, Inc. v. Gore, 517 U.S. 559,
576 (1996)). The trial court determined that Thomas's conduct
was "extremely reprehensible" because of his voluntary
intoxication. As noted in our opinion on original submission,
there is a presumption under Alabama law that a person will
not consciously do something that will cause himself or
herself harm. See Ex parte Essary, 992 So. 2d 5, 12 (Ala.
6
1150118, 1150119
2007)(citing Griffin Lumber Co. v. Harper, 252 Ala. 93, 95, 39
So. 2d 399, 401 (1949)). However, this self-preservation
presumption may be rebutted by, among other things, evidence
indicating that the actor did not have possession of his or
her normal faculties such that he or she did not appreciate
the danger the actor's actions posed to himself or herself.
Id. In the present case, clear and convincing evidence was
presented
that
indicated
that
Thomas
was
voluntarily
intoxicated to the point that he could not appreciate the
danger his actions posed to himself; the self-preservation
presumption in favor of Thomas was rebutted by the clear and
convincing evidence of Thomas's voluntary intoxication
presented by the Heards and Wells.1 Thomas drove his vehicle,
with a minor as a passenger, while he was voluntarily
intoxicated to the point that he could not appreciate the
1Thomas disagrees with this interpretation of the
evidence. Essentially, Thomas is simply reasserting his
argument on original submission that the Heards and Wells
failed to present clear and convincing evidence that his
conduct was wanton. Those arguments were considered and
addressed on original submission and present nothing new for
our consideration at this point in the proceedings. Other
than arguing that there is no clear and convincing evidence of
his wantonness, Thomas has presented no argument challenging
the trial court's conclusion that his conduct was extremely
reprehensible.
7
1150118, 1150119
danger to which this activity exposed him and all those around
him. This conduct resulted in serious injuries to Thomas and
three other people.
Thomas's conduct evinces indifference and
a reckless disregard for the health and safety of others. See
Gore,
517
U.S.
at
576
(noting,
in
considering
the
reprehensibility factor, that the defendant's conduct in that
case "evinced no indifference to or reckless disregard for the
health and safety of others"). Accordingly, the trial court
properly found that Thomas's conduct was reprehensible; this
factor weighs against remittitur of the punitive-damages
awards.
Next, we note that the trial court determined that the
ratio of punitive damages to compensatory damages awarded in
these cases weighs against remittitur. We agree. Concerning
this factor, this Court stated in Shiv-Ram, Inc. v. McCaleb,
892 So. 2d 299, 317 (Ala. 2003):
"Under [BMW of North America, Inc. v.] Gore, 517
U.S. [559,] 575, 116 S. Ct. 1589 [(1996)], and
[State Farm Mutual Automobile Insurance Co. v.]
Campbell, 538 U.S. [408,] 419, 123 S. Ct. [1513,]
1521 [(2003)], we presume that [the plaintiff] has
been
made
whole
for
injuries
by
the
compensatory-damages award, but we do not consider
that the ratio between the punitive-damages award
and the compensatory-damages award of slightly less
than three to one is unreasonable. See AutoZone[,
8
1150118, 1150119
Inc. v. Leonard], 812 So. 2d [1179,] 1187 [(Ala.
2001)], approving a ratio of punitive damages to
compensatory damages of 3.7:1, despite the fact that
all of the $75,000 compensatory-damages award in
excess of $3,000 necessarily related to mental
anguish. ... Subsequently, in Campbell, the United
States Supreme Court observed that, based on prior
caselaw, in practice few awards exceeding to a
significant degree a single-digit ratio between
punitive and compensatory damages would satisfy due
process and acknowledged that in both Gore and
Pacific Mutual Life Insurance Co. v. Haslip, 499
U.S. 1, 111 S. Ct. 1032, 113 L. Ed. 2d 1 (1991), it
had approved a 4:1 ratio."
In the present case, the jury awarded Randell $850,000 in
compensatory damages and $750,000 in punitive damages; the
ratio of punitive to compensatory damages for Randell is
0.88:1. The jury awarded Donna $450,000 in compensatory
damages and $750,000 in punitive damages; the ratio of
punitive to compensatory damages for Donna is 1.67:1. The
jury awarded Wells $500,000 in compensatory damages and
$500,000 in punitive damages; the ratio of punitive to
compensatory damages for Wells is 1:1. Accordingly, we find
the ratio of punitive damages to compensatory damages to be
reasonable for all three plaintiffs.
Lastly, the trial court determined that "the financial
condition of [Thomas] was not a factor that diminished the
appropriateness of the punitive damages awarded." After this
9
1150118, 1150119
Court remanded the cases for the trial court to enter orders
consistent with Hammond, Thomas filed a motion for a
remittitur. Thomas attached to his motion his own affidavit,
but the affidavit was not signed by Thomas or notarized.
Thomas's unsigned affidavit states that Thomas is currently
unemployed, that he has not been employed since the accident,
that he has no current source of income, no assets, and no
money in his checking account, and that he is unable to
satisfy any portion of the judgments entered against him. The
Heards filed a motion to strike Thomas's affidavit on the
basis that Thomas had failed to sign the affidavit.
In its orders on remand denying Thomas's motion for a
remittitur, the trial court refused to consider not only the
unsigned affidavit, but also all testimony offered by Thomas.
The trial court held that Thomas "was not a credible witness."
(Emphasis in original.) The trial court further stated:
"In oral argument before this court [Thomas's]
counsel made the statement that [Thomas's] affidavit
can be considered by the court as evidence in the
case and proof of [Thomas's] financial condition,
and verification was not needed. Plaintiffs urged
[Thomas's] affidavit to be struck as not timely
filed; however, it really doesn’t matter. If the
witness on the affidavit is found not to be a
credible witness by the court, then verification of
that information would be necessary to convince the
10
1150118, 1150119
court that the contents are true. Such was not
provided, and, therefore, since [Thomas] is not
credible, the court finds no evidence of [Thomas's]
true financial condition, and, thus, concludes that
the financial condition of [Thomas] was not a factor
that diminished the appropriateness of the punitive
damages awarded."
We note that the trial court did not strike Thomas's
affidavit, as the Heards requested. Instead, the trial court
simply found that Thomas was not a credible witness and that
his testimony, in any form, was not credible. In Cameron v.
State, 508 So. 2d 304, 306 (Ala. Crim. App. 1987), the Court
of Criminal Appeals stated that a trial court's finding that
a witness "was not a credible witness"
"is binding on the court which 'can neither pass
judgment on the possible truthfulness or falsity of
testimony, ... nor on the credibility of witnesses.'
Collins v. State, 412 So. 2d 845, 846 (Ala. Crim.
App. 1982) (citations omitted). 'When there is no
showing to the contrary, the presumption is always
in favor of correct action on the part of the trial
judge.' Ballard v. State, 236 Ala. 541, 542, 184 So.
260 (1938)."
Thomas makes no argument in his brief before this Court
concerning the trial court's finding that he was not a
credible witness. Instead, ignoring that portion of the trial
court's orders, Thomas simply asserts that he offered
testimony concerning his financial position. Because Thomas
11
1150118, 1150119
has not challenged the trial court's finding that he was not
a credible witness, we will not consider this testimony. We
further note, although not argued by Thomas, that the trial
court did not err in refusing to give any weight to Thomas's
unsworn affidavit testimony. In State Home
Builders Licensure
Board v. Stephens, 756 So. 2d 878, 879 (Ala. Civ. App. 1998),
the Court of Civil Appeals noted that an affidavit unsigned by
the affiant "does not constitute admissible evidence."
Accordingly, there is essentially no evidence indicating
Thomas's financial position. As a result, this factor weighs
neither in favor of nor against a finding that the punitive-
damages awards were excessive.
Conclusion
Having considered the trial court's remand orders in
light of the Gore and Hammond/Green Oil factors, we conclude
that no remittitur is needed and that the punitive-damages
awards returned by the jury are appropriate and do not
infringe upon Thomas's due-process rights.
1150118 -- AFFIRMED.
1150119 -- AFFIRMED.
Parker, Main, and Wise, JJ., concur.
12
1150118, 1150119
Shaw and Bryan, JJ., concur in the result.
Stuart, C.J., and Bolin, Murdock, and Sellers, JJ.,
dissent.
13
1150118, 1150119
MURDOCK, Justice (dissenting).
I dissent for the same reasons I dissented from the
opinion issued on March 24, 2017, remanding these cases for
the
trial
court
to
revisit
the
remittitur
issue.
Specifically, I did not think then that there was sufficient
evidence to allow a jury to find that wantonness on the part
of Timothy Joel Thomas had been "clearly and convincingly"
established. The orders of the trial court on remand do not
address the several deficiencies in the evidence of
wantonness
that I pointed out in my special writing to the March 24,
2017, opinion.
14 | November 3, 2017 |
3bd7643f-ccfc-4122-b4f9-213d04e6a570 | Ex parte Raymond Dennis Earl. | N/A | 1170116 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1170116
Ex parte Raymond Dennis Earl. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF
CRIMINAL Ap p e a l s (In re: Raymond Dennis Earl v. State of Alabama) (Russell Circuit
Court: CC-94-136.62; Criminal Appeals :
CR-16-0856).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Main, J. - Stuart, C.J., and Bolin, Murdock, and Bryan, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
l i t a
Clerk, Supreme Court of Alabama | December 8, 2017 |
0a5bf96b-b602-48f5-a72b-549f2568916d | Timothy Joel Thomas v. Laura Wells, as guardian ad litem and next friend of M.A., a minor | N/A | 1150119 | Alabama | Alabama Supreme Court | rel: November 3, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
____________________
1150118
____________________
Timothy Joel Thomas
v.
Randell Heard and Donna Heard
Appeal from Geneva Circuit Court
(CV-14-900015)
____________________
1150119
____________________
Timothy Joel Thomas
v.
Laura Wells, as guardian ad litem and next friend of M.A., a
minor
Appeal from Geneva Circuit Court
(CV-13-900145)
On Return to Remand
PER CURIAM.
Timothy Joel Thomas appealed from judgments entered in
favor of Randell Heard and Donna Heard and in favor of Laura
Wells, as guardian ad litem and next friend of M.A., a minor.
The Heards and Wells had separately sued Thomas alleging
negligence and wantonness and seeking to recover damages for
injuries the Heards and M.A. had suffered as the result of an
automobile accident. A jury returned verdicts in favor of
Randell Heard, awarding compensatory damages of $850,000 and
punitive damages of $750,000; in favor of Donna Heard,
awarding
compensatory
damages
of
$450,000
and
punitive
damages
of $750,000; and in favor of Wells, awarding compensatory
damages of $500,000 and punitive damages of $500,000. The
trial court entered judgments on the jury's verdicts. Thomas
argued that the jury's punitive-damages awards were excessive
under the guideposts set out by the United States Supreme
Court in BMW of North America, Inc. v. Gore, 517 U.S. 559
(1996), and the factors set out by this Court in Hammond v.
City of Gadsden, 493 So. 2d 1374 (Ala. 1986), and Green Oil
2
1150118, 1150119
Co. v. Hornsby, 539 So. 2d 218 (Ala. 1989), and requested a
remittitur. The trial court denied Thomas's request for a
remittitur without explaining its reasoning for doing so.
On appeal, this Court affirmed the judgments as to the
compensatory-damages awards but remanded the cases with
instructions for the trial court to enter orders in compliance
with Hammond, 493 So. 2d at 1379 ("[I]t is not only
appropriate, but indeed our duty, to require the trial courts
to reflect in the record the reasons for interfering with a
jury verdict, or refusing to do so, on grounds of
excessiveness of the [punitive] damages."). See Thomas v.
Heard, [Ms. 1150118, March 24, 2017] ___ So. 3d ___ (Ala.
2017). Pursuant to our instructions, the trial court, on May
24, 2017, after conducting a Hammond/Green Oil hearing,
entered identical orders in both cases reaffirming the
punitive-damages awards. The trial court made its return to
this Court. The only issue now before this Court is whether
the
punitive-damages
awards
are,
as
Thomas contends,
excessive. For the reasons given, we conclude that they are
not.
Standard of Review
3
1150118, 1150119
This Court reviews de novo an award of punitive damages.
National Ins. Ass'n v. Sockwell, 829 So. 2d 111, 135 (Ala.
2002).
Discussion
In reviewing a punitive-damages award, we apply the
factors outlined in Green Oil, supra, and Hammond, supra,
within the guideposts set out in Gore, supra, as restated in
State Farm Mutual Automobile Insurance Co. v. Campbell, 538
U.S. 408 (2003).
The
Gore
guideposts
are:
"(1)
the
degree
of
reprehensibility of the defendant's misconduct; (2) the
disparity between the actual or potential harm suffered by the
plaintiff and the punitive damages award; and (3) the
difference between the punitive damages awarded by the jury
and the civil penalties authorized or imposed in comparable
cases." State Farm, 538 U.S. at 418 (citing Gore, 517 U.S. at
575). The Hammond/Green Oil factors are:
"'(1) the reprehensibility of [the defendant's]
conduct;
(2)
the
relationship
of
the
punitive-damages award to the harm that actually
occurred, or is likely to occur, from [the
defendant's] conduct; (3) [the defendant's] profit
from
[his]
misconduct;
(4)
[the
defendant's]
financial position; (5) the cost to [the plaintiff]
of the litigation; (6) whether [the defendant] has
4
1150118, 1150119
been subject to criminal sanctions for similar
conduct; and (7) other civil actions [the defendant]
has been involved in arising out of similar
conduct.'"
Ross v. Rosen–Rager, 67 So. 3d 29, 41–42 (Ala. 2010) (quoting
Shiv–Ram, Inc. v. McCaleb, 892 So. 2d 299, 317 (Ala.
2003)(paraphrasing the Hammond/Green Oil factors)).
In the present case, the trial court stated in its orders
denying Thomas's motion for a remittitur:
"The parties agreed that there were basically
three Hammond issues that applied to this case and
one was not in dispute. The parties agreed that the
difference between compensatory and punitive damages
awarded
by
the
jury
was
not
a
significant
difference, and therefore, this factor is an
indicator that the punitive damage[s] award was
reasonable.
"The two issues counsel focused on in oral
argument were:
"1) The degree of reprehensibility of
the defendant's conduct.
"2) The financial position of the
defendant."
The trial court considered all the Gore and Hammond/Green Oil
factors but determined that only three were applicable.
Thomas has not disputed this aspect of the trial court's
orders. In making his argument that the punitive-damages
awards should be remitted, Thomas addresses only the factors
5
1150118, 1150119
concerning the degree of reprehensibility of his conduct and
his financial position. Accordingly, we will limit our
analysis to the factors identified by the trial court as
applicable in determining whether the awards of punitive
damages were reasonable; nevertheless, our conclusion that no
remittitur is warranted is ultimately based upon a review of
all the relevant factors. See CNH America, LLC v. Ligon
Capital, LLC, 160 So. 3d 1195, 1211 (Ala. 2013)(setting forth
analysis concerning only those Gore and Hammond/Green Oil
factors addressed by the appellant).
First, this Court has recognized that the degree of
reprehensibility of a defendant's conduct "is the single most
important factor in the remittitur analysis."
Pensacola Motor
Sales, Inc. v. Daphne Auto., LLC, 155 So. 3d 930, 949 (Ala.
2013)(citing BMW of North America, Inc. v. Gore, 517 U.S. 559,
576 (1996)). The trial court determined that Thomas's conduct
was "extremely reprehensible" because of his voluntary
intoxication. As noted in our opinion on original submission,
there is a presumption under Alabama law that a person will
not consciously do something that will cause himself or
herself harm. See Ex parte Essary, 992 So. 2d 5, 12 (Ala.
6
1150118, 1150119
2007)(citing Griffin Lumber Co. v. Harper, 252 Ala. 93, 95, 39
So. 2d 399, 401 (1949)). However, this self-preservation
presumption may be rebutted by, among other things, evidence
indicating that the actor did not have possession of his or
her normal faculties such that he or she did not appreciate
the danger the actor's actions posed to himself or herself.
Id. In the present case, clear and convincing evidence was
presented
that
indicated
that
Thomas
was
voluntarily
intoxicated to the point that he could not appreciate the
danger his actions posed to himself; the self-preservation
presumption in favor of Thomas was rebutted by the clear and
convincing evidence of Thomas's voluntary intoxication
presented by the Heards and Wells.1 Thomas drove his vehicle,
with a minor as a passenger, while he was voluntarily
intoxicated to the point that he could not appreciate the
1Thomas disagrees with this interpretation of the
evidence. Essentially, Thomas is simply reasserting his
argument on original submission that the Heards and Wells
failed to present clear and convincing evidence that his
conduct was wanton. Those arguments were considered and
addressed on original submission and present nothing new for
our consideration at this point in the proceedings. Other
than arguing that there is no clear and convincing evidence of
his wantonness, Thomas has presented no argument challenging
the trial court's conclusion that his conduct was extremely
reprehensible.
7
1150118, 1150119
danger to which this activity exposed him and all those around
him. This conduct resulted in serious injuries to Thomas and
three other people.
Thomas's conduct evinces indifference and
a reckless disregard for the health and safety of others. See
Gore,
517
U.S.
at
576
(noting,
in
considering
the
reprehensibility factor, that the defendant's conduct in that
case "evinced no indifference to or reckless disregard for the
health and safety of others"). Accordingly, the trial court
properly found that Thomas's conduct was reprehensible; this
factor weighs against remittitur of the punitive-damages
awards.
Next, we note that the trial court determined that the
ratio of punitive damages to compensatory damages awarded in
these cases weighs against remittitur. We agree. Concerning
this factor, this Court stated in Shiv-Ram, Inc. v. McCaleb,
892 So. 2d 299, 317 (Ala. 2003):
"Under [BMW of North America, Inc. v.] Gore, 517
U.S. [559,] 575, 116 S. Ct. 1589 [(1996)], and
[State Farm Mutual Automobile Insurance Co. v.]
Campbell, 538 U.S. [408,] 419, 123 S. Ct. [1513,]
1521 [(2003)], we presume that [the plaintiff] has
been
made
whole
for
injuries
by
the
compensatory-damages award, but we do not consider
that the ratio between the punitive-damages award
and the compensatory-damages award of slightly less
than three to one is unreasonable. See AutoZone[,
8
1150118, 1150119
Inc. v. Leonard], 812 So. 2d [1179,] 1187 [(Ala.
2001)], approving a ratio of punitive damages to
compensatory damages of 3.7:1, despite the fact that
all of the $75,000 compensatory-damages award in
excess of $3,000 necessarily related to mental
anguish. ... Subsequently, in Campbell, the United
States Supreme Court observed that, based on prior
caselaw, in practice few awards exceeding to a
significant degree a single-digit ratio between
punitive and compensatory damages would satisfy due
process and acknowledged that in both Gore and
Pacific Mutual Life Insurance Co. v. Haslip, 499
U.S. 1, 111 S. Ct. 1032, 113 L. Ed. 2d 1 (1991), it
had approved a 4:1 ratio."
In the present case, the jury awarded Randell $850,000 in
compensatory damages and $750,000 in punitive damages; the
ratio of punitive to compensatory damages for Randell is
0.88:1. The jury awarded Donna $450,000 in compensatory
damages and $750,000 in punitive damages; the ratio of
punitive to compensatory damages for Donna is 1.67:1. The
jury awarded Wells $500,000 in compensatory damages and
$500,000 in punitive damages; the ratio of punitive to
compensatory damages for Wells is 1:1. Accordingly, we find
the ratio of punitive damages to compensatory damages to be
reasonable for all three plaintiffs.
Lastly, the trial court determined that "the financial
condition of [Thomas] was not a factor that diminished the
appropriateness of the punitive damages awarded." After this
9
1150118, 1150119
Court remanded the cases for the trial court to enter orders
consistent with Hammond, Thomas filed a motion for a
remittitur. Thomas attached to his motion his own affidavit,
but the affidavit was not signed by Thomas or notarized.
Thomas's unsigned affidavit states that Thomas is currently
unemployed, that he has not been employed since the accident,
that he has no current source of income, no assets, and no
money in his checking account, and that he is unable to
satisfy any portion of the judgments entered against him. The
Heards filed a motion to strike Thomas's affidavit on the
basis that Thomas had failed to sign the affidavit.
In its orders on remand denying Thomas's motion for a
remittitur, the trial court refused to consider not only the
unsigned affidavit, but also all testimony offered by Thomas.
The trial court held that Thomas "was not a credible witness."
(Emphasis in original.) The trial court further stated:
"In oral argument before this court [Thomas's]
counsel made the statement that [Thomas's] affidavit
can be considered by the court as evidence in the
case and proof of [Thomas's] financial condition,
and verification was not needed. Plaintiffs urged
[Thomas's] affidavit to be struck as not timely
filed; however, it really doesn’t matter. If the
witness on the affidavit is found not to be a
credible witness by the court, then verification of
that information would be necessary to convince the
10
1150118, 1150119
court that the contents are true. Such was not
provided, and, therefore, since [Thomas] is not
credible, the court finds no evidence of [Thomas's]
true financial condition, and, thus, concludes that
the financial condition of [Thomas] was not a factor
that diminished the appropriateness of the punitive
damages awarded."
We note that the trial court did not strike Thomas's
affidavit, as the Heards requested. Instead, the trial court
simply found that Thomas was not a credible witness and that
his testimony, in any form, was not credible. In Cameron v.
State, 508 So. 2d 304, 306 (Ala. Crim. App. 1987), the Court
of Criminal Appeals stated that a trial court's finding that
a witness "was not a credible witness"
"is binding on the court which 'can neither pass
judgment on the possible truthfulness or falsity of
testimony, ... nor on the credibility of witnesses.'
Collins v. State, 412 So. 2d 845, 846 (Ala. Crim.
App. 1982) (citations omitted). 'When there is no
showing to the contrary, the presumption is always
in favor of correct action on the part of the trial
judge.' Ballard v. State, 236 Ala. 541, 542, 184 So.
260 (1938)."
Thomas makes no argument in his brief before this Court
concerning the trial court's finding that he was not a
credible witness. Instead, ignoring that portion of the trial
court's orders, Thomas simply asserts that he offered
testimony concerning his financial position. Because Thomas
11
1150118, 1150119
has not challenged the trial court's finding that he was not
a credible witness, we will not consider this testimony. We
further note, although not argued by Thomas, that the trial
court did not err in refusing to give any weight to Thomas's
unsworn affidavit testimony. In State Home
Builders Licensure
Board v. Stephens, 756 So. 2d 878, 879 (Ala. Civ. App. 1998),
the Court of Civil Appeals noted that an affidavit unsigned by
the affiant "does not constitute admissible evidence."
Accordingly, there is essentially no evidence indicating
Thomas's financial position. As a result, this factor weighs
neither in favor of nor against a finding that the punitive-
damages awards were excessive.
Conclusion
Having considered the trial court's remand orders in
light of the Gore and Hammond/Green Oil factors, we conclude
that no remittitur is needed and that the punitive-damages
awards returned by the jury are appropriate and do not
infringe upon Thomas's due-process rights.
1150118 -- AFFIRMED.
1150119 -- AFFIRMED.
Parker, Main, and Wise, JJ., concur.
12
1150118, 1150119
Shaw and Bryan, JJ., concur in the result.
Stuart, C.J., and Bolin, Murdock, and Sellers, JJ.,
dissent.
13
1150118, 1150119
MURDOCK, Justice (dissenting).
I dissent for the same reasons I dissented from the
opinion issued on March 24, 2017, remanding these cases for
the
trial
court
to
revisit
the
remittitur
issue.
Specifically, I did not think then that there was sufficient
evidence to allow a jury to find that wantonness on the part
of Timothy Joel Thomas had been "clearly and convincingly"
established. The orders of the trial court on remand do not
address the several deficiencies in the evidence of
wantonness
that I pointed out in my special writing to the March 24,
2017, opinion.
14 | November 3, 2017 |
b201b0e2-9e47-4acb-b211-70c533f52bfd | Ex parte Joe Nathan James, Jr. | N/A | 1160971 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
November 17, 2017
1160971
Ex parte Joe Nathan James, Jr. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF
CRIMINAL APPEALS (In re: Joe Nathan James, Jr. v. State of Alabama) (Jefferson Circuit
Court: CC-95-4747.61; Criminal Appeals :
CR-16-0229).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on November 17, 2017:
Writ Denied. No Opinion. Shaw, J. - Stuart, C.J., and Bolin, Parker, Main, Wise, Bryan,
and Sellers, JJ., concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 17th day of November, 2017.
l i t a
Clerk, Supreme Court of Alabama | November 17, 2017 |
6851349a-a545-482b-9c08-f37411f9e5ec | Ex parte Ronald D. Veteto. | N/A | 1170101 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1170101
Ex parte Ronald D. Veteto. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF
CIVIL APPEALS (In re: Ronald D. Veteto v. Jeff Dunn, DeWayne Estes, Cedric Specks,
Anthony Brooks, Kevin White, Gary Malone, William Northcutt, Bruce Hodge, Jonathan Truitt,
John Mason, Wendell Guthery, March Jones, Christopher McLaurin, Mark Michael, James
Barton, Jasper Luitze, Cory Martin, Michael Williamson and Dameta Baldwin.) (Montgomery
Circuit Court: CV-17-55; Civil Appeals :
2160668).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Parker, J. - Stuart, C.J., and Shaw, Wise, and Sellers, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
Clerk, Supreme Court of Alabama | December 8, 2017 |
59c20ef0-b255-4d0e-84f2-bed2af7b9a1a | Ghee v. USAble Mutual Insurance Co. | N/A | 1160082 | Alabama | Alabama Supreme Court | REL: October 27, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
____________________
1160082
____________________
Douglas Ghee, as personal representative of the Estate of
Billy Fleming, deceased
v.
USAble Mutual Insurance Company d/b/a Blue Advantage
Administrators of Arkansas
Appeal from Calhoun Circuit Court
(CV-15-900383 and CV-15-900383.80)
MURDOCK, Justice.
Douglas Ghee, as personal representative of the estate of
Billy Fleming, deceased, appeals from an order of the Calhoun
Circuit Court dismissing his wrongful-death claim against
1160082
USAble
Mutual
Insurance
Company
d/b/a
Blue
Advantage
Administrators of
Arkansas
("Blue
Advantage"). We
dismiss
this
appeal as being from a nonfinal order.
I. Facts
Blue Advantage was the claims administrator for Fleming's
self-funded employee-health-benefits plan, which Fleming
received through his employment with Wal-Mart Stores, Inc.
There is no dispute that the health-benefits plan falls under
the auspices of the Employee Retirement Income Security Act of
1974 ("ERISA"), 29 U.S.C. § 1001 et seq. That plan will be
referred to hereinafter as "the ERISA plan."
Ghee filed a complaint in the Calhoun Circuit Court
alleging a wrongful-death claim against Blue Advantage, among
others, based on Fleming's death. The circuit court granted
Blue Advantage's Rule 12(b)(6), Ala. R. Civ. P., motion to
dismiss Ghee's complaint against it based on federal
preemption under ERISA, specifically based on 29 U.S.C. §
1144(a). The allegations in Ghee's complaint were pivotal to
this determination; therefore, it is best to relay the facts
exactly as alleged in the complaint:
"18. On June 11, 2013, [Fleming] presented to the
[Northeast Alabama] RMC [Regional Medical Center]
2
1160082
emergency department. According to records, he was
complaining of constipation and abdominal pain that
he rated as a 10 on a 10-point scale.
"19. [Fleming] was diagnosed with abdominal pain
with constipation and fecal impaction.
"20. [Fleming] was admitted to the hospital.
"21. On June 12, 2013, a CT of [Fleming's] abdomen
showed, according to a written report, a moderate
amount of fecal material within [Fleming's] sigmoid
colon and rectum.
"22. On June 14, 2013, Dr. Rosen attempted to
perform a colonoscopy on [Fleming], but according to
Dr. Rosen's notes, he was unable to pass the scope
beyond 30 centimeters, and stated that, '[g]iven the
marked severity of constipation, the inadequate
colon prep despite multiple colon preparations, the
patient would benefit [from] subtotal colectomy.'[1]
"23. On June 15, 2013, Dr. Crawford was consulted,
and according to his notes, agreed that [Fleming]
required a colectomy and scheduled the procedure for
two weeks later as an outpatient procedure in order
to give [Fleming's] colon an opportunity to flatten
out.
"24. [Fleming] was discharged home from RMC on June
17, 2013.
"25. On July 2, 2013, [Fleming] visited Dr. Crawford
as a followup at the Crawford Clinic and was
scheduled to undergo his colectomy on July 10, 2013.
"26. Dr. Crawford and/or the Crawford Clinic,
according to its records, sought pre-approval for
the surgery from [Blue Advantage] via CPT code
1A colectomy is a surgery that involves removal of all or
part of the colon.
3
1160082
564.9, which is unspecified functional disorder of
intestine.[2]
"27. On July 3, 2013, [Fleming] presented to RMC for
his pre-anesthetic evaluation.
"28. On or about July 5, 2013, an agent of the
Crawford Clinic called [Fleming] and informed him
that he could not have the surgery because [Blue
Advantage] had decided that a lower quality of care
-- continued non-surgical management -- was more
appropriate than the higher quality of care --
surgery -- that [Fleming] needed and that his
surgeon felt was appropriate.
"29. [Fleming] and his family then had multiple
conversations with agents of [Blue Advantage] in an
unsuccessful attempt to convince the company that
the higher quality of care (surgery, as recommended
by [Fleming's] doctors) was the more appropriate
course. Ultimately, an agent of [Blue Advantage]
suggested to [Fleming] that he return to RMC in an
attempt
to
convince
hospital
personnel
and
physicians to perform the surgery on an emergency
basis.
"30. On the night of July 10, 2013 (after midnight
so that the hospital records indicate a visit of
July 11), [Fleming] returned to the RMC emergency
department. According to records, he was complaining
of severe abdominal pain.
"31. [Fleming] explained his history involving his
prior admission and canceled surgery.
2In its brief, Blue Advantage states: "This is a misnomer
in the complaint. It should read 'ICD9 code 564.9.' CPT codes
refer to procedures (the colectomy). ICD9 codes refer to
diagnosis (Fleming's unspecified functional disorder of
intestine)."
4
1160082
"32. A CT of [Fleming]'s abdomen showed, according
to a written report, a moderate amount of retained
stool throughout [Fleming's] colon.
"33. [Fleming] was seen and discharged that day
(7/11/13) by Dr. Williams, D.O.
"34. On July 14, 2013, [Fleming] returned to the RMC
emergency department and according to the records,
complaining of severe abdominal pain and rectal
bleeding.
"35. [Fleming] again reported his history involving
his prior admission and canceled surgery.
"36. No diagnostic imaging was performed during this
visit (7/14/13).
"37. [Fleming] was seen and discharged that day
(7/14/13) by Summer Phelps, N.P., and Dr. Proctor.
"38. On July 15, 2013, [Fleming] was brought back to
the RMC emergency department by Oxford EMS, and
according
to
records,
complaining
of
urinary
retention, severe abdominal pain and constipation.
"39. [Fleming] again reported his history involving
his prior admission and canceled surgery.
"40. Again, [Fleming] was seen and sent home, this
time by Dr. Simmons.
"41. During this entire time, [Blue Advantage] was
providing for a certain level of care to be provided
to
[Fleming]:
non-surgical
management
of
his
life-threatening bowel obstruction. However, [Blue
Advantage] never agreed to provide him with the
higher quality of care he needed: life-saving
surgical intervention.
5
1160082
"42. At approximately 10:30 a.m., [Fleming] was
brought by Anniston EMS to Stringfellow Memorial
Hospital in severe distress.
"43. [Fleming's] condition declined rapidly, he had
to be intubated, eventually coded and died after
midnight that night (the night of 7/15/13, the
morning of 7/16/13).
"44. Dr. Thomas Garland performed an autopsy, which
confirmed that [Fleming] had a perforated sigmoid
colon with abundant fecal material identified within
the peritoneal cavity.
"45. Dr. Crawford attended at least a portion of the
autopsy.
"46. Dr. Vishwanath M. Reddy certified [Fleming's]
death certificate listing the cause of death as
follows: septic shock due to peritonitis due to
colonic perforation."
On July 14, 2015, Ghee, as personal representative of
Fleming's estate, filed a wrongful-death action in
the
Calhoun
Circuit Court against Blue Advantage, Northeast Alabama
Regional Medical Center, the Crawford Clinic, four doctors,
and a nurse, asserting that their combined and concurring
negligence and wrongful conduct proximately caused Fleming's
death. Specifically with respect to Blue Advantage, Ghee
alleged that it contributed to Fleming's death through the
following actions:
"68. [Blue Advantage] had or voluntarily assumed one
or more of the following duties, jointly or in the
6
1160082
alternative: a duty to act with reasonable care in
the determining the quality of healthcare [Fleming]
would receive; a duty not to provide to [Fleming] a
quality of healthcare so low that it knew that
[Fleming] was likely to be injured or killed; and a
duty to exercise such reasonable care, skill, and
diligence as other similarly situated healthcare
providers in the same general line of practice
ordinarily have and exercise in a like case.
"69. [Blue Advantage] breached those duties, jointly
or in the alternative, as follows:
"a. Negligently providing for a lower
quality of healthcare for [Fleming];
"b. Wantonly providing for a lower quality
of healthcare for [Fleming];
"c. Breaching the standard by (i) failing
to provide a higher quality of healthcare
to
[Fleming]
(necessary,
life
saving
surgery) and (ii) failing to communicate
adequately with [Fleming]'s healthcare
providers his need for surgery.
"70. Those breaches combined with the actions of
other defendants as a legal cause of death for ...
Fleming, in that without the breaches, [Fleming]
would have more likely than not survived.
"71. Per Dukes v. US Healthcare, Inc., 57 F.3d 350
(3d Cir. 1995), Ghee makes no complaint that
benefits were denied to [Fleming]; indeed, [Blue
Advantage] provided multiple, numerous and repeated
benefits (a high quantity) to [Fleming] in an
attempt to manage his bowel obstruction without
surgery. Ghee's only complaint against [Blue
Advantage], as detailed above, involves the quality
of the benefit received, specifically that it was of
such a low quality (did not include necessary
surgery) that it caused [Fleming]'s death. Further,
7
1160082
considering [Fleming] is deceased, he necessarily
cannot attempt to force [Blue Advantage] to provide
any benefits to him. He is dead. Because of this
indisputable reality, Ghee does not seek any
benefits or even compensatory damages (state law
does not allow for such damages) but instead only
the wrongful death, punitive damages allowed by
Alabama state law."
On August 20, 2015, Blue Advantage removed the case to
the United States District Court for the Northern District of
Alabama on the basis of complete preemption under ERISA,
specifically under 29 U.S.C. § 1132. On August 27, 2015, Blue
Advantage filed a motion in the circuit court to dismiss the
claim against it based on federal preemption. On September 9,
2015, Ghee filed a motion to stay all proceedings in federal
court until the federal district court had ruled on the issue
of subject-matter jurisdiction. The federal district court
granted that motion the following day. On September 21, 2015,
Ghee filed a motion to remand the case to the circuit court on
the ground that the claims were not completely preempted by
ERISA.
On December 2, 2015, the federal district court entered
an order remanding the case to the circuit court. In its
order, the federal district court explained that complete
preemption did not apply because Ghee was not seeking benefits
8
1160082
under the ERISA plan but, rather, was seeking only punitive
damages under Alabama's "unique" wrongful-death statute. The
federal district court noted that "[b]ecause the Alabama
wrongful death statute does not allow recovery for the value
of benefits denied, only punishment for causing a death, the
suit could not be brought under the ERISA private enforcement
action."
Ghee
v.
Regional
Med.
Ctr.
Bd.,
No.
1:15-CV-1430-VEH, Dec. 2, 2015 (N.D. Ala. 2015)(not reported
in F. Supp. 3d).3
On December 29, 2015, Blue Advantage filed a motion to
dismiss based on the affirmative defense of ordinary, or
defensive, ERISA preemption, specifically under 29 U.S.C. §
1144(a). Blue Advantage argued that Ghee's wrongful-death
action "relates to" Blue Advantage's administration of the
ERISA plan's benefits and that, therefore, the
claims asserted
therein were preempted. Specifically, it explained that
"without ... Blue Advantage's coverage determination, Ghee
3Blue Advantage could not appeal this decision because
federal law prohibits review of a federal district court's
remand, following a removal, that is based on subject-matter
jurisdiction. See 28 U.S.C. § 1447(c) & (d); In re
Loudermilch, 158 F.3d 1143, 1145 (11th Cir. 1998) ("[I]f the
district court remands a case based on reasons set forth in
section 1447(c), no review may be had: whether the district
court's decision was correct or not makes no difference.").
9
1160082
would have no basis to allege that Blue Advantage failed to
provide Fleming with the appropriate quality of care." Blue
Advantage attached the ERISA plan to its motion to dismiss,
noting that Ghee had referenced the plan in his complaint.
On March 1, 2016, Ghee filed a response in opposition to
Blue Advantage's motion to dismiss. Ghee contended that he
was not relying on Blue Advantage's administration of the
ERISA plan but, rather, was asserting a claim based on Blue
Advantage's
intervening
in
Fleming's
health-care
treatment
and
mandating the treatment he must receive, which treatment, Ghee
asserts, led to his death.
On October 4, 2016, the circuit court entered an order
granting Blue Advantage's Rule 12(b)(6), Ala. R. Civ. P.,
motion to dismiss on the basis of defensive preemption. In
the order, the circuit court also certified the order as
final under Rule 54(b), Ala. R. Civ. P., because, it reasoned,
Blue Advantage's preemption defense did not apply to any of
the other defendants and the ruling did not affect Ghee's
claims against the other defendants. The order further
stated: "[Ghee] is granted leave to file an amended complaint
within 30 days of the date of this order, should he choose to
10
1160082
do so, to pursue any relief to which he may believe himself
entitled under ERISA."
On October 26, before the 30-day window to amend his
complaint had run, Ghee filed a notice of appeal to this
Court.
II. Analysis
Although neither party argues on appeal that the circuit
court's certification of its October 4, 2016, order as final
under Rule 54(b) was inappropriate, if it was not appropriate,
then
this
Court's
jurisdiction
is
implicated.
"[J]urisdictional matters are of such magnitude that we take
notice of them at any time and do so even ex mero motu." Nunn
v. Baker, 518 So. 2d 711, 712 (Ala. 1987). See also, e.g.,
Fuller v. Birmingham-Jefferson Cty. Transit Auth., 147 So. 3d
907, 911 (Ala. 2013) (affirming the authority of an appellate
court to take notice of "jurisdictional matters, such as
whether an order is final so as to support an appeal").
Rule 54(b) provides, in part:
"When more than one claim for relief is presented in
an action, whether as a claim, counterclaim,
cross-claim, or third-party claim, or when multiple
parties are involved, the court may direct the entry
of a final judgment as to one or more but fewer than
all of the claims or parties only upon an express
11
1160082
determination that there is no just reason for delay
and upon an express direction for the entry of
judgment."
This Court has stated:
"'The purpose of Rule 54(b) ... is to make final "an
order which does not adjudicate the entire case but
as to which there is no just reason for delay in the
attachment of finality."' Ex parte James, 836 So.
2d 813, 852 (Ala. 2002) (Moore, C.J., concurring in
the result in part and dissenting in part) (quoting
Foster v. Greer & Sons, Inc., 446 So. 2d 605, 609
(Ala. 1984), overruled on other grounds, Ex parte
Andrews, 520 So. 2d 507 (Ala. 1987)). However,
'"[n]ot every order has the requisite element of
finality that can trigger the operation of Rule
54(b)."' Dzwonkowski[ v. Sonitrol of Mobile, Inc.,]
892 So. 2d [354,] 361 [(Ala. 2004)] (quoting Goldome
Credit Corp. v. Player, 869 So. 2d 1146, 1147 (Ala.
Civ. App. 2003) (emphasis omitted)).
"'"Rule 54(b) certifications 'should be made
only in exceptional cases.'"' Posey v. Mollohan,
991 So. 2d 253, 258–59 (Ala. Civ. App. 2008)
(quoting Wallace v. Tee Jays Mfg. Co., 689 So. 2d
210, 212 (Ala. Civ. App. 1997))."
Stephens v. Fines Recycling, Inc., 84 So. 3d 867, 874–75 (Ala.
2011). More specifically, a Rule 54(b) certification "must
fully adjudicate at least one claim":
"'[F]or a Rule 54(b) certification of finality
to be effective, it must fully adjudicate at least
one claim or fully dispose of the claims as they
relate to at least one party.' Haynes v. Alfa Fin.
Corp., 730 So. 2d 178, 181 (Ala. 1999).
"'If an order does not completely
dispose of or fully adjudicate at least one
12
1160082
claim, a court's Rule 54(b) certification
of the order is not effective. See Haynes
v. Alfa Fin. Corp., 730 So. 2d 178 (Ala.
1999). Damages are only one portion of a
claim to vindicate a legal right, even
though the damages claimed may consist of
several elements. See id. at 181. An
order is not final if it permits a party to
return to court and prove more damages or
if
it
leaves
open
the
question
of
additional
recovery.
See
Precision
American Corp. v. Leasing Serv. Corp., 505
So. 2d 380, 382 (Ala. 1987).'
"Grantham v. Vanderzyl, 802 So. 2d 1077, 1080 (Ala.
2001)."
Certain Underwriters at Lloyd's, London v. Southern Nat. Gas
Co., 939 So. 2d 21, 28 (Ala. 2006) (emphasis omitted).
A "claim" for purposes of Rule 54(b) is not a separate
"count" or legal theory set out in a complaint; it essentially
is the cause of action from which the plaintiff's theories of
recovery emerge.
"The Scrushy [v. Tucker, 955 So. 2d 988 (Ala.
2006),] Court quoted with approval the United
States Court of Appeals for the Seventh Circuit for
'"certain rules of thumb to identify those types of
claims that can never be considered separate"' for
purposes of Rule 54(b). 955 So. 2d at 998 (quoting
Stearns v. Consolidated Mgmt., Inc., 747 F.2d 1105,
1108 (7th Cir. 1984)). One such rule is that
'"'claims
cannot
be
separate
unless
separate
recovery is possible on each.... Hence, mere
variations of legal theory do not constitute
separate claims.'"' Id. (quoting Stearns, 747 F.2d
at 1108-09, quoting in turn Amalgamated Meat Cutters
13
1160082
v. Thompson Farms Co., 642 F.2d 1065, 1071 (7th Cir.
1981)). The Scrushy Court also noted the similar
rule of the United States Court of Appeals for the
Second Circuit, see Rieser v. Baltimore & Ohio R.R.,
224 F.2d 198, 199 (2d Cir. 1955), which was
summarized by the commentators of Federal Practice
and Procedure:
"'"A single claimant
presents
multiple
claims
for
relief
under
the
Second
Circuit's formulation when the possible
recoveries are more than one in number and
not mutually exclusive or, stated another
way, when the facts give rise to more than
one legal right or cause of action ....
However, when a claimant presents a number
of legal theories, but will be permitted to
recover only on one of them, the bases for
recovery are mutually exclusive, or simply
presented
in
the
alternative,
and
plaintiff
has only a single claim for relief for
purposes of Rule 54(b)."'
"955 So. 2d at 998 (quoting 10 Charles Alan Wright
et al., Federal Practice & Procedure § 2657 (3d ed.
1998) (footnotes omitted))."
North Alabama Elec. Coop. v. New Hope Tel. Coop., 7 So. 3d
342, 345 (Ala. 2008) (emphasis added). We also have stated:
"Neither federal nor state courts have been able to
settle on a single test to determine when claims are
separate or exactly what constitutes a claim. See,
Tolson [v. United States], 732 F.2d [998,] at 1001
[(D.C. Cir. 1984)]; Cates v. Bush, 293 Ala. 535, 307
So. 2d 6 (1975). However, authorities have stated
that 'when plaintiff is suing to vindicate one legal
right and alleges several elements of damage, only
one claim is presented and subdivision (b) [of rule
54] does not apply.' 10 C. Wright, A. Miller, & M.
Kane, Federal Practice and Procedure: Civil 2d, §
14
1160082
2657, at 69-71 (1983); Landry v. G.B.A., 762 F.2d
462, 464 (5th Cir. 1985)."
Precision American Corp. v. Leasing Serv. Corp., 505 So. 2d
380, 381 (Ala. 1987) (emphasis added).
In this case, the circuit court purported to adjudicate
Ghee's claim stemming from Blue Advantage's failure to approve
a colectomy as treatment for Fleming's problem, but in so
doing it entered an order that expressly allows Ghee to amend
his complaint "within 30 days of the date of this order,
should he choose to do so, to pursue any relief to which he
may believe he is entitled under ERISA." Any claim for relief
Ghee may state under ERISA would stem from the same conduct on
the part of Blue Advantage that gave rise to Ghee's state-law
claim. In other words, in the same order in which the circuit
court purported to fully adjudicate Ghee's "claim," or cause
of action, against Blue Advantage, it left open the
possibility that Ghee could reframe and reassert that cause
under another legal theory.
Such an order is not proper for Rule 54(b) certification.
To permit a trial court to adjudicate a claim as pleaded by
the plaintiff, while simultaneously permitting the plaintiff
to amend his or her complaint in an effort to assert a
15
1160082
different theory to vindicate the same right, would entirely
undermine the purpose of Rule 54(b). Rule 54(b) exists
because "'"'"[a]ppellate review in a piecemeal fashion is not
favored."'"'" Schlarb v. Lee, 955 So. 2d 418, 419 (Ala. 2006)
(quoting Dzwonkowski v. Sonitrol of Mobile, Inc., 892 So. 2d
354, 363 (Ala. 2004), quoting in turn Goldome Credit Corp. v.
Player, 869 So. 2d 1146, 1148 (Ala. Civ. App. 2003), quoting
in turn other cases (emphasis omitted)). Concomitantly, as
noted,
"'"'[c]ertifications under
Rule
54(b)
should
be
entered
only in exceptional cases and should not be entered
routinely.'"'" Id. (quoting Dzwonkowski, 892 So. 2d at 363,
quoting in turn State v. Lawhorn, 830 So. 2d 720, 725 (Ala.
2002), quoting in turn Baker v. Bennett, 644 So. 2d 901, 903
(Ala. 1994)).
It is true that in his reply brief Ghee disavows having
an ERISA claim stemming from the same conduct on which Ghee
based his state-law claim. But nothing bars Ghee from
changing his position and asserting such a claim on remand
once this Court has addressed the present appeal. And the
circuit court has expressly held open the record so as to make
16
1160082
that possible.4 The circuit court cannot purport to enter a
final adjudication of a claim while making it possible for the
plaintiff to revive that very claim. Accordingly, the circuit
court did not render a proper Rule 54(b) certification, and we
do not have before us a final judgment.
Because the appeal before us is not from a final
judgment, it is dismissed.
APPEAL DISMISSED.
Stuart, C.J., and Bolin, Main, and Bryan, JJ., concur.
4As noted, Ghee appealed the circuit court's order within
30 days of the date of the order, leaving open the possibility
that Ghee could amend his complaint following our disposition
of this appeal.
17 | October 27, 2017 |
b0d8b44e-4f05-41da-8566-4f5777dc56bf | Joseph L. McNamara, Jr. v. Benchmark Insurance Company | N/A | 1151314 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
November 17, 2017
1151314
Joseph L. McNamara, Jr. v. Benchmark Insurance Company (Appeal from Shelby
Circuit Court: CV-14-900180).
CERTIFICATE OF JUDGMENT
WHEREAS, the ruling on the application for rehearing filed in this case and indicated
below was entered in this cause on November 17, 2017:
Application Overruled. No Opinion. Sellers, J. - Stuart, C.J., and Bolin, Parker, Shaw, Main,
Wise, and Bryan, JJ., concur. Murdock, J., dissents.
WHEREAS, the appeal in the above referenced cause has been duly submitted and
considered by the Supreme Court of Alabama and the judgment indicated below was entered
in this cause on September 8, 2017:
Reversed And Remanded. Sellers, J. - Stuart, C.J., and Main, and Wise, JJ., concur. Bolin,
Parker, Shaw, and Bryan, JJ., concur in the result. Murdock, J., dissents.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 17th day of November, 2017.
Clerk, Supreme Court of Alabama | November 17, 2017 |
dab9bfdf-988c-47ea-8d59-6ab1fa2f7898 | Jerry Coleman, as administrator of the Estate of Virginia Coleman, deceased. v. Anniston HMA, LLC, d/b/a Stringfellow Memorial Hospital | N/A | 1151212 | Alabama | Alabama Supreme Court | Rel: December 1, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334)
229-0649), of any typographical or other errors, in order that corrections may be made
before the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
_________________________
1151212
_________________________
Jerry Coleman, as administrator of the Estate of Virginia
Coleman, deceased
v.
Anniston HMA, LLC, d/b/a Stringfellow Memorial Hospital
Appeal from Calhoun Circuit Court
(CV-11-900108)
PER CURIAM.
AFFIRMED. NO OPINION.
See Rule 53(a)(1) and (a)(2)(F), Ala. R. App. P.
Stuart, C.J., and Main, Bryan, and Sellers, JJ., concur.
Shaw, J., concurs specially.
Bolin, Parker, Murdock, and Wise, JJ., dissent.
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SHAW, Justice (concurring specially).
I concur to affirm the trial court's judgment. I write
specially
to
respectfully
respond
to
Justice
Bolin's
dissenting opinion.
The facts of this case are thoroughly discussed in the
dissent, and I see no need to repeat them all here. For
purposes of this writing, I note that Virginia Coleman was
suffering from gastrointestinal bleeding, that she spent a
night in the intensive-care unit of Stringfellow Memorial
Hospital operated by Anniston HMA, LLC, d/b/a Stringfellow
Memorial Hospital ("the Hospital"), and that she died the next
day following surgery. The plaintiff, Jerry Coleman, the
administrator of Virginia's estate, contends that additional
treatment should have been rendered to Virginia the night
before she died and that the failure to render such treatment
caused her death. Virginia did not receive such additional
treatment, it is alleged, because the nurses monitoring
Virginia, who were employed by the Hospital, breached the
standard of care by failing to call or to alert a doctor to
Virginia's condition during that night.
2
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The Hospital produced substantial evidence indicating
that the nurses' failure to call the doctor made no difference
in this case. Specifically, Dr. Clifford Black was the
physician on standby. The nurses had contacted him at 9:40
p.m. regarding Virginia's condition. He ordered tests and
ordered that testing recur every two hours; if Virginia's
blood levels fell below a certain value, she was to receive a
transfusion. Coleman's experts asserted that, during the
night, the nurses should have again telephoned the doctor
regarding Virginia's condition. Dr. Harry Moulis, one of
Coleman's experts, opined that additional treatments were
available and could have been given to Virginia had the nurses
telephoned the doctor. Dr. Black disagreed; he specifically
testified that he was "fully aware" of the condition that was
causing the bleeding and that the records of Virginia's
condition on the night in question showed no change that
required the nurses to call him. In fact, when he saw
Virginia the next morning, he reviewed her chart and spoke
with the nurses about her condition and how she had progressed
over the night. He did not change his previous order; he did
not, at that time, order the "additional treatments" Dr.
3
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Moulis said were available. He testified that, if the nurses
had called him that night, he would not have changed the order
he had given previously that evening: "I can state under oath
that even had the nursing staff contacted me during that
period of time, my Order would not have changed. This is made
clear by the fact that my Order did not change when I saw the
patient at 8:30 a.m." the next morning. So, Dr. Black's
testimony indicates that even if the nurses had telephoned
him, he would not have ordered the additional treatment
Coleman argues Virginia should have received. This is
undisputed in the record. This argument formed the basis of
the Hospital's second motion for a summary judgment, which the
trial court granted.
This is not just a situation where we have two dueling
experts--Dr. Black and Dr. Moulis--arguing over what should
have been done if the nurses had called; I agree with the
dissent that the resolution of that dispute should be
determined by the jury. But we also have an undisputed
assertion of what would have actually happened if the nurses
had telephoned him: Dr. Black testified that
he--the physician
on standby who had been treating Virginia that night--would
4
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not have ordered the additional treatment Dr. Moulis says was
required.
The dissent addresses Dr. Black's testimony that he would
not have ordered additional treatment had the nurses called by
suggesting that the testimony created another issue for the
jury to resolve. Specifically, the dissent points out that
Dr. Black's testimony might be considered self-serving or the
product of bias. Under different facts, I might agree: Years
after the incident, Dr. Black might now say that he would have
done nothing different, but Dr. Moulis suggests that a
physician in Dr. Black's shoes--lest he commit medical
malpractice--would have done the opposite. Thus, Dr. Black's
credibility could be called into question. However, two
factors unique to this case--one substantive and one
procedural--cause me to disagree with the dissent.
When Dr. Black saw Virginia the next morning, he ordered
no additional treatment. If, at that point, Dr. Black ordered
no additional treatment, then how can his assertion that he
would not have ordered additional treatment earlier, when
Virginia was in a lesser state of decline, lack credibility?
His actions the next morning confirm that a telephone call by
5
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the nurses the previous night would have resulted in no change
in treatment. If Virginia's demise was the result of not
receiving additional treatment, that failure to receive
additional treatment would not have been caused by the nurses.
Further, as a matter of procedure, we cannot reverse the
summary judgment on this ground: This specific issue
concerning Dr. Black's credibility is neither preserved for
review nor argued on appeal. In the trial court, the Hospital
twice moved for a summary judgment. The first motion was
denied, and, in support of the second motion, the Hospital
produced Dr. Black's affidavit testimony and argued that
Coleman could not prove causation. That was the sole basis of
the second motion. Coleman, in his response to the second
motion, made no argument regarding Dr. Black's affidavit other
than
incorporating
the previous
filings
and
stating:
"Plaintiff submits that the Affidavit of Dr. Black does not
materially change the record or evidence before the Court."
Coleman presented no specific argument to the trial court
suggesting that Dr. Black's affidavit was not credible or that
it created an issue for the jury to decide. Because this
argument was not raised in the trial court, it cannot form the
6
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basis of a reversal. Ex parte Ford Motor Co., 47 So. 3d 234,
241 (Ala. 2010) ("'"This Court cannot consider arguments
raised for the first time on appeal; our review is restricted
to the evidence and arguments considered by the trial
court."'" (quoting Marks v. Tenbrunsel, 910 So. 2d 1255, 1263
(Ala. 2005), quoting in turn Andrews v. Merritt Oil Co., 612
So. 2d 409, 410 (Ala. 1992))); and Totten v. Lighting &
Supply, Inc., 507 So. 2d 502, 503 (Ala. 1987) ("[O]n appeal,
this Court is limited to a review of the record alone, and an
issue not reflected in the record as having been raised in the
trial court cannot be raised for the first time on appeal.").
Further, Coleman does not raise this issue on appeal--
there is no argument in Coleman's brief claiming that Dr.
Black's affidavit lacked credibility. There is no discussion
of the affidavit, and there is no suggestion that Dr. Moulis's
testimony discounted Dr. Black's testimony and thus created a
credibility issue.1 When an appellant fails to properly argue
an issue, or does not argue it at all, that issue is waived
1Coleman's brief discusses the affidavit as follows: "In
this case, [the nurses] failed and the doctors were traveling
blind. It is the Plaintiff's position herein that Dr. Black's
Affidavit testimony merely creates a question of fact."
Coleman's brief, at 14. There is no further discussion of the
issue after that statement.
7
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and will not be considered for purposes of appellate review.
Tucker v. Cullman-Jefferson Counties Gas Dist., 864 So. 2d
317, 319 (Ala. 2003). Additionally, "'no matter will be
considered on appeal unless presented and argued in brief.'"
Id. (quoting Braxton v. Stewart, 539 So. 2d 284, 286 (Ala.
Civ. App. 1988)). It is clear to me that, because the trial
court initially denied the Hospital's summary-judgment motion
but then granted it after the submission of Dr. Black's
affidavit, Dr. Black's testimony was a key basis for its
decision. In light of the above discussion, I concur to
affirm that decision.
8
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BOLIN, Justice (dissenting).
Jerry Coleman, as administrator of the estate of Virginia
Coleman, deceased, appeals from a summary judgment entered in
favor of Anniston HMA, LLC, d/b/a Stringfellow Memorial
Hospital ("the Hospital"). For the following reasons, I
respectfully dissent from this Court's no-opinion affirmance
of the summary judgment in favor of the Hospital.
Facts and Procedural History
On March 26, 2009, at 11:50 a.m., Virginia Coleman
presented
to
the
emergency department of
Stringfellow
Memorial
Hospital by ambulance. She was vomiting blood and complained
of headaches and abdominal pain. She was 84 years old and had
a past medical history that included a bleeding ulcer and
three cardiac stents. Virginia was on numerous medications,
including anticoagulants.
Dr. Michael Proctor evaluated Virginia in the emergency
room and assessed Virginia as having an "Acute Upper
Gastrointestinal Bleed." At 2:30 p.m., she was admitted to
the intensive-care unit by Dr. Heather Sabo and diagnosed with
an upper gastrointestinal bleed, migraine, respiratory
failure, and hypotension. She was seen by Dr. Leigh Hemphill
9
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at approximately 6:50 p.m., who noted her to have a "massive
GI bleed." Dr. Hemphill's notes provide that "[t]he patient
will need transfusion, IV proton pump inhibitors. We can try
some p.o. Carafate but at the rate of this bleed, I do not
think this will do much good. We have consulted GI and
Surgery. The patient has indicated by previous decision that
I am told that she is a No Code. Additional diagnostic
interventions to appropriate clinical condition."
Virginia was seen by Dr. Sabo again at or around 7:50
p.m. Dr. Clifford Black, the surgeon on standby, was
contacted by the Hospital's staff about Virginia's condition
at around 9:40 p.m. Dr. Black ordered further blood
transfusion.
From 9:40 p.m. on March 26 to the morning of March 27,
Virginia's blood volume dropped. Virginia's medical records
indicate that she had decreased urine output; that her skin
was pale and cool; that she had tachycardia; that her blood
pressure dropped; and that she was confused. Virginia lost
almost seven units of blood, and three units were replaced.
Virginia also received saline and platelets.
On March 27 at 8:30 a.m., Dr. Black examined Virginia.
10
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He recommended "Dr. Shaikh scoping her urgently to determine
the source of the bleeding." An endoscopy was performed on
Virginia at 11:27 a.m. A bleeding lesion was found. It was
cauterized and injected with a constricting agent, and a clip
was applied. Later that day, Virginia developed respiratory
failure, was intubated, and ultimately suffered a
full cardiac
arrest. She was pronounced dead at 8:07 p.m. on March 27,
2009.
On March 24, 2011, Jerry Coleman, as administrator of
Virginia's estate, filed a wrongful-death action under the
Alabama Medical Liability Act, § 6-5-480 et seq. and § 6-5-540
et seq., Ala. Code 1975, in the Calhoun Circuit Court. The
action named the Hospital and Dr. Sabo as defendants. Coleman
alleged that the defendants were negligent in failing to
properly assess, monitor, treat, and manage Virginia's care
and, further, that the nursing staff failed to alert a
physician of the severity of Virginia's condition during the
night of March 26-27, 2009, and that her deteriorating
condition went unreported until Virginia was seen by a
physician at 8:30 a.m. the following morning.
11
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Dr. Sabo passed away on November 28, 2012. On September
30, 2013, the parties filed a joint stipulation of dismissal
as to Dr. Sabo, and the trial court entered an order
dismissing Dr. Sabo with prejudice on October 2, 2013.
On January 28, 2016, the Hospital filed a motion for a
summary judgment. In support of its motion, it attached the
deposition testimony of Coleman's standard-of-care expert,
Lisa Henson, a registered nurse. Henson contended that the
Hospital's nursing staff had breached the standard of care
because they failed to contact Virginia's physicians during
the night of March 26, 2009, and early morning hours of March
27. Henson testified:
"Q. Go ahead and tell me what opinions you are
prepared to offer in this case.
"A. My opinions stem from the nursing portion of
the nurses that took care of [Virginia] from the
period of time when she got into the ICU. My opinion
is that the nurses had orders from the physicians to
care for her. But from the last physician that saw
her at 19:50, which was Dr. Sabo, no physician had
laid eyes on her until the next morning. As a nurse,
having a patient bleed out the way she was bleeding,
should have been on the phone trying to express that
to a physician, a provider that she is bleeding more
than what we are putting in. She is not, you know
–- I need some help, I need a physician in here;
that was not done. The orders that they had, they
did carry out, but they did not let the physician
know the extent of what [Virginia] was bleeding, and
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that should have been carried through. Someone
should have notified the physician and let him know,
whichever physician was directing her care at that
time, at least that she was bleeding so much, and
they didn't do that.
"Q. Is there some indication in the record to
you that the physicians were not aware of this
massive GI bleed?
"A. One physician wrote that it was a massive GI
bleed. That was earlier in the day. What I’m talking
about is once she got into critical care and after
Dr. Sabo saw her at 19:50, no other physician came
to see her until 8:30 the next morning. She had lost
approximately one-half of her circulating volume of
blood. She was only given back three units of blood.
She lost almost seven units of blood, but she was
only given back three.
"....
"Q. If I understand then, your criticism of
nursing care is between the time of admission at CCU
[sic] -- or actually, I would suppose, from Dr.
Sabo's visit at 19:50 until what time the following
morning?
"A. Until the following morning, until the
doctor had seen her, and I think it was Dr. Black
that saw her at 8:30 that morning, I could not find
in the chart at any time after 21:40 -- the last
physician was notified at 21:40 and that was Dr.
Black was the one that the nurse had called to get
the order for blood transfusion. He had given her an
order if it was less than 28, to transfuse one unit
of blood and to use that order for every H&H that
was drawn, which the nurse did follow his orders.
But no nurse ever contacted a physician after that
to say she continues to bleed, she is bleeding
massively, I need some help, what we are giving her
is not working. No one ever contacted a physician to
13
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let them know that what they were doing and what
their orders were for this patient was not working.
"....
"Q. So the nurses followed orders, but the
nurses just should have been advising the physicians
of the patient's condition more closely during that
period of time?
"A. Correct.
"Q. So that the physicians could, if they felt
the need, make other efforts to stabilize the
patient?
"A. Correct.
"....
"Q. So had there been any changes in her vitals
during that period of time which in and of
themselves would have required nursing to call a
physician?
"A. When she was tachycardic in the 120s -–
before she had been in the 70s and 80s area, 90s
sometimes. But once she went to tachycardic, you
know, close to 130, somebody should have been
calling them and saying, you know, her heart rate is
130, her blood pressure is low. I don’t think those
were relayed to anybody because most of those things
were documented on the blood volume slips and
physicians don’t look at those. So they wouldn't
know unless a nurse told them, you know, I have got
this going and, you know, she is more tachycardia,
her blood pressure is low. They would not know that
unless a nurse picked up the phone and called them
and told them that. We are their eyes and ears. And
we are supposed to be advocates for patients. If
that were my patient, I would be on the phone every
hour letting them know, you know, I’ve had this much
14
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out this hour, I've had this much out this hour, you
know, this is what's going on; I think you need to
get in here and see her now. And if he didn't come
or wouldn't come, I would have kept going up the
chain of command until I got to the medical
director.
"....
"Q. The nurses per orders could not have given
any more blood than what they gave, could they?
"A. Correct. They could not."
The Hospital also referred to the testimony of Coleman's
medical-causation expert, Dr. Harry Moulis. Dr. Moulis
testified that it was his opinion that there was a delay in
treatment of Virginia and that that delay caused her death.
He testified that there were other treatment modalities that
could
have
been
administered
before
the
endoscopy.
Specifically, Dr. Moulis testified:
"Q. Let's sort of take a step back now, and we
know from the records that sometime around 11:30 on
the morning of the 26th, the patient came in by
ambulance with an upper GI bleed. Correct?
"A. Correct.
"Q. The upper GI bleed was diagnosed quickly?
"A. Correct.
"Q, Now, do you have any criticisms of how the
upper GI bleed was addressed, first of all, by the
physician in the emergency room?
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"A. I don't know how long it took for the
physician to see the patient, I can't tell that from
the records. I could just tell when the dictation
was written.
"Q. Right.
"A. So I don't know if there was a delay in
seeing the patient or not --
"Q. Right.
"A. -- I can't find that information. There are
guidelines, recommendations on what to do for a
massive upper GI bleed. And he started two IV's, and
I couldn't gather if there were two IV's started,
getting
a
lot
of
fluids
underway,
ordering
transfusions. When we're looking at transfusions,
that's a whole other area of specialty, hematology,
but it pertains, of course, here. One of those notes
suggested give more than one unit of packed red
blood cells. But the pathologist said, no, patient
does not meet criteria for second unit pack red
blood cells because the number wasn't low enough,
but --
"Q. The hematic number was not low enough.
Correct?
"A. That's correct. But in reality in a
situation like this, more blood should have been
given and that order by the pathologist should have
been overwritten."
When Dr. Moulis was asked specifically about the delay in
the endoscopy procedure, he stated:
"Q. Alright. How did the delay of the scope
procedure lead to her cardiac arrest later that day
on the 27th?
16
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"A. The delay in the procedure may not have
caused the death but the delay in overall treatment.
There are other treatment modalities that could have
or should have been administered
before the
endoscopy."
Dr. Moulis went on to testify that there were other
treatments available and appropriate, such as a medication
known as Sandostatin. It was his testimony that these other
avenues or modalities of treatment should have been
administered if it was going to be awhile before the endoscopy
was performed.
"Q. Okay. What other delayed treatment were not
made which could have led ultimately to her cardiac
arrest?
"A. Trying to halt the bleed medically before an
endoscopy was performed. There's medication we often
use called Sandostatin.
"Q. Okay.
"A.
Originally that medication was
used to
treat
suspected variceal bleeding. The studies have shown
it helps decrease bleeding from any upper GI source.
So it’s an intravenous medication.
"Q.
So
you’re saying
that some
physicians should
have prescribed that treatment for the bleed?
"A. Yes, if there was going to be a delay in
endoscopy, yes.
"Q.
Okay. My
understanding is,
they were
seeking
to treat the bleed through the use of platelets.
17
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"A. Okay.
"Q. Did you see anything else, any other ways
that they were trying to do so?
"A. As far as halting the bleed before endoscopy
that's the only thing I found. The protonics, the
intravenous medication, will not stop a bleed. It
may stabilize a clot if it starts forming to
decrease a second bleed if it starts, but it won't
stop the bleed.
"Q. Okay. What I guess I need to try to
understand is: In your opinion what ultimately led
to this 84-year-old lady's cardiac arrest some
several hours after the upper GI --
"....
"Q. So can you testify to a reasonable degree of
medical certainty that the delay in having the
endoscopy caused or contributed to cause her
ultimate death?
"A. I can say delay in treatment; I can’t say
specifically the endoscopy. The medical literature
suggests that urgent endoscopy within five hours
versus delayed more than 12 hours may not have an
[overall] impact, but other forms of medical care.
"Q. Okay, so if you can't say it about the
endoscopy let's talk specifically, what other forms
of medical care you believed were delayed or not
provided which could have lead to her death?
"A. Well, I mentioned the Sandostatin or
Somatostatin.
"Q. Somatostatin, okay.
"A. Platelets have been administered sooner.
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"Q. Platelets sooner?
"A. Sure. And I understand that they were in a
different facility. They weren't even at the
hospital and they had to be brought in is what I
could gather somewhere. There was a delay in
administration from ordering.
"Q. Did you get that from the deposition?
"A. It may have been in there. I know I just
glanced through that and happen to see that.
"Q. Okay. Go ahead.
"A. Extra blood volume, even though the blood
count had not dropped dramatically. Remember, she
got the first unit of blood. I think the two units
were ordered, but the pathologist wouldn't release
a second unit because her blood count wasn't low
enough.
"Q. Okay.
"A. But she was exsanguinating; so, in our
situation, I would have administered at least two
units right away and have a lot more available just
in case.
"Q. Okay. What else?
"....
"Q. So now that we sort of cleared that up
[regarding the timing of a second unit of red blood
cells], do you still believe that there were
problems with getting extra blood volume in a timely
basis?
"A. I do because probably by the time she got to
the hospital, she had lost several units. When
patients bleed, they lose blood cells and plasma. If
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they are given enough IV fluids, the blood count
will drop because of dilution. If they are given no
blood, a patient can have one pint of blood left in
the body and a blood count would be normal. So
without knowing how much volume the patient
received, it’s hard to determine. But, my point is,
she lost -- from what I could gather, she was
passing red blood per rectum. That's a large volume
GI bleed.
"....
"Q: Based upon your experience, in your
education and training and your review of the
records that you have identified that you reviewed
in this case, do you have an opinion as to whether
or not a delay in treatment for [Virginia] more
likely than not contributed to her death?
"A: I would say probably, based on my experience
in my patients.
"Q: Now my question is not assuming what that
delay may have been caused by. But in your opinion
a delay in treatment, appropriate treatment for her,
probably contributed to her death.
"A: I would say probably yes."
In its summary-judgment motion, the Hospital argued:
"In this case, Henson cannot testify as to
causation at all, and Dr. Moulis has established 3-4
physician related factors which he believes may have
delayed treatment of the decedent and contributed to
her demise. What he did not establish is that some
specific lack of knowledge of the decedent’s
condition on the part of any physician in any way
caused delay. There is no testimony or evidence to
this regard. In fact, [Coleman's] nursing expert had
to admit that Dr. Black made no changes to the
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decedent’s orders or care upon seeing the patient on
the morning of the 27th.
"Further, the criticisms of [Dr.] Moulis are
directed to orders and treatments that he contends
should have been ordered on the 26th and the early
morning hours of the 27th (the critical time period
according to Henson), according to [Dr.] Moulis,
these treatment modalities should have long been in
place. In short, there is a total disconnect between
[Coleman's] theory of causation ... and his theory
of liability. Without evidence that 'points to at
least one theory of causation, indicating a logical
sequence of cause and effect,' there is no 'judicial
basis for such a determination.' [The Hospital] is
thus entitled to the entry of summary judgment as to
all claims."
In response, Coleman attached additional parts of
Henson's and Dr. Moulis's testimony, along with additional
medical records of Virginia's. Coleman asserted that Henson's
opinion was that the nurses working the overnight shift were
negligent in failing to alert the doctors or to keep the
doctors informed as to Virginia's worsening condition and
that
Dr. Moulis's testimony was to the effect that, in light of
Virginia's worsening condition, other treatment modalities
should have been taken before the endoscopy was performed.
Coleman argued that the doctors were not given the opportunity
to address Virginia's condition. He argued that Dr. Moulis's
testimony regarding the delay in treatment was substantial
21
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evidence showing that Virginia's condition was adversely
affected by the alleged negligence.
On March 21, 2016, the trial court denied the Hospital's
summary-judgment motion. On June 24, 2016, the Hospital filed
a renewed motion for a summary judgment, attaching the
affidavit of Dr. Black, who testified, in pertinent part, as
follows:
"Concerning
[Virginia's]
admission
of
3/26/2009,
I was requested by Dr. Heather Sabo to provide a
surgical consult on [Virginia]. On 3/26/2009,
[Virginia] had developed a substantial bleed in her
abdomen. The plan of care for [Virginia] by Dr.
Sabo was to obtain a GI consult and have a scope
procedure performed to hopefully determine the area
of the bleed and repair it. I was standing by in
case surgery was needed. In the interim, [Virginia]
was being managed by the use of platelets and packed
red blood cells in order to maintain her hematocrit
and hemoglobin levels and maintaining blood volume
with the assistance of normal saline IV.
"At 9:40 p.m. on the night of 3/26/2009 I was
contacted by the ICU nursing staff and was provided
all information regarding the patient's condition.
I entered an Order to repeat hematocrit and
hemoglobin testing every two (2) hours and if the
patient's hematocrit fell below 28, to administer 1
unit of packed red blood cells. My review of the
records indicate that these orders were followed by
the nursing staff.
"I saw the patient at 8:30 a.m. on the morning
of 3/27/2009. I spoke with nursing concerning her
condition and how she had progressed through the
previous evening and reviewed her chart. I
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considered her to be stable at that point, though
slightly tachycardic. The plan was to continue to
monitor and maintain her hematocrit and hemoglobin
levels and wait the pending GI consult. The GI
consult was performed later that morning by Dr.
Rosen. Dr. Rosen performed an endoscopic procedure
and repaired two (2) areas of bleeding in the
patient's abdomen. Hours after this procedure. The
patient then had sudden loss of blood pressure and
ultimately passed away.
"I
disagree with
Dr.
Moulis's opinion that
there
was a delay in treatment that in any way caused or
contributed to cause [Virginia's] death.
"I note that the primary assertion of Lisa
Henson, R.N., is that the ICU nurses at Stringfellow
Memorial Hospital fell below the standard of care
because they did not contact a physician after my
Order of 9:40 p.m. until I saw [Virginia] the next
morning at 8:30 a.m. I disagree. Beginning with my
Order at 9:40 p.m., I was fully aware of the nature
and extent of [Virginia's] GI bleed. My review of
the records show no change significant enough to
have required the nursing staff in the ICU during
the evening and early morning hours of 3/26/2009 and
3/27/2009 to contact me. I can state under oath
that even had the nursing staff contacted me during
that period of time, my Order would not have
changed. This is made clear by the fact that my
Order did not change when I saw the patient at 8:30
a.m. on the 27th. ..."
In response, Coleman argued that Dr. Black's affidavit
did not materially change the record or the evidence before
the court. Coleman again argued that there were genuine
issues of material fact precluding a summary judgment. He
referenced his response to the Hospital's original summary-
23
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judgment motion in which he had argued that the doctors were
not given the opportunity to address Virginia's worsening
condition because of the nurses' negligence.2 On July 15,
2016, the trial court granted the Hospital's renewed motion
for a summary judgment. Coleman appealed.
Discussion
At the outset, I note that in Sorrell v. King, 946 So. 2d
854 (Ala. 2006), this Court observed:
"A plaintiff in a medical-malpractice action
must also present expert testimony establishing a
causal connection between the defendant's act or
omission constituting the alleged breach and the
injury suffered by the plaintiff. Pruitt v. Zeiger,
590 So. 2d 236, 238 (Ala. 1991). See also Bradley
v. Miller, 878 So. 2d 262, 266 (Ala. 2003);
University of Alabama Health Servs. Found., P.C. v.
Bush, 638 So. 2d 794, 802 (Ala. 1994); and Bradford
v. McGee, 534 So. 2d 1076, 1079 (Ala. 1988). To
prove causation in a medical-malpractice case, the
plaintiff must demonstrate '"that the alleged
negligence
probably
caused,
rather
than
only
possibly caused, the plaintiff's injury."' Bradley,
878 So. 2d at 266 (quoting University of Alabama
Health Servs., 638 So. 2d at 802). See also DCH
Healthcare Auth. v. Duckworth, 883 So. 2d 1214, 1217
(Ala. 2003) ('"There must be more than the mere
2Justice Shaw argues that Coleman failed to raise the
issue of Dr. Black's credibility. I believe the issue is
properly before this Court; a trial court is precluded from
engaging in credibility determinations on a summary-judgment
motion. Here, the dueling experts created a genuine issue of
material fact as to Virginia's care that precluded the entry
of a summary judgment.
24
1151212
possibility that the negligence complained of caused
the injury; rather, there must be evidence that the
negligence
complained
of
probably
caused
the
injury."' (quoting Parker v. Collins, 605 So. 2d
824, 826 (Ala. 1992))); and Pendarvis v. Pennington,
521 So. 2d 969, 970 (Ala. 1988) ('"The rule in
medical malpractice cases is that to find liability,
there must be more than a mere possibility or one
possibility
among
others
that
the
negligence
complained of caused the injury; there must be
evidence that the negligence probably caused the
injury."' (quoting Williams v. Bhoopathi, 474 So. 2d
690, 691 (Ala. 1985), and citing Baker v. Chastain,
389 So. 2d 932 (Ala. 1980))). In Cain v. Howorth,
877 So. 2d 566 (Ala. 2003), this Court stated:
"'"'To present a jury question,
the
plaintiff
[in
a
medical-malpractice
action]
must adduce some evidence indicating that
the alleged negligence (the breach of the
appropriate standard of care) probably
caused the injury. A mere possibility is
insufficient. The evidence produced by the
plaintiff
must
have
"selective
application"
to one theory of causation.'"'
"877 So. 2d at 576 (quoting Rivard v. University of
Alabama Health Servs. Found., P.C., 835 So. 2d 987,
988 (Ala. 2002))."
946 So. 2d at 862. See also Breland v. Rich, 69 So. 3d 803,
821 (Ala. 2011)("Our cases addressing a delay in diagnosis
and/or treatment provide that with regard to the issue of
causation, the question is whether the breach of the standard
of care, i.e., the delay in diagnosis and/or treatment,
25
1151212
proximately and probably caused actual injury to the
plaintiff.").
Coleman argues that he presented substantial evidence
supporting a reasonable inference that the negligent conduct
of the Hospital's employees probably caused or contributed to
Virginia's death. He argues that, through Henson's testimony,
he presented evidence showing that the Hospital's employees
breached the standard of care in failing to communicate "at
all" with Virginia's treating physicians in light of her
declining condition and that Dr. Moulis's testimony is
evidence that Virginia's death was probably caused or
contributed to by a delay in providing her with the
appropriate treatment. Coleman further argues that Dr.
Black's testimony that he would not have ordered different or
additional treatment even if had been informed of Virginia's
declining condition simply presents a question for a jury.
The Hospital argues that, although there was testimony
from Henson that there had been a breach of the standard of
care and testimony from Dr. Moulis that a delay in treatment
probably caused Virginia's death, there was no nexus between
the two. The Hospital asserts that there was no nexus because
26
1151212
there was no testimony alleging that the breach in any way
related to the delay in treatment. The Hospital further
asserts that Dr. Black's testimony that he would not have
changed his course of treatment even if he had been told
during the overnight hours that Virginia's condition was
worsening conclusively establishes that the nurses' care and
treatment of Virginia during the overnight hours in no way
caused or contributed to her death.
I disagree with the Hospital's assertion that there was
a "disconnect" between Henson's testimony and Dr. Moulis's
testimony. It is well settled that no expert can testify
outside his or her area of expertise. Dr. Moulis could
testify as to proximate cause, but he could not testify as to
the applicable nursing standard of care because he is not a
nurse and does not possess knowledge of nursing standards.
Cf. Morgan v. Publix Super Markets, Inc., 138 So. 3d 982 (Ala.
2011)(holding that physicians designated as experts were not
qualified to give expert testimony regarding the standard of
care applicable to pharmacists and whether that standard of
care had been breached). Henson could testify as to the
whether the nurses breached the standard of care, but could
27
1151212
not testify as to whether that breach was the proximate cause
of Virginia's death.
In Phillips v. Alamed Co., 588 So. 2d 463, 465 (Ala.
1991), the plaintiff sued Alamed, a home-health-care company,
alleging that its employees had been negligent in failing to
properly assess the patient's condition and in failing to
report her complaint of shortness of breath to her physician
and that their negligence was a proximate cause of her death.
The plaintiff argued that the trial court erred by sustaining
Alamed's objection to the testimony of a registered nurse on
the issue of proximate cause. This Court stated:
"The question of whether Alamed's failure to
report [the patient's] complaint of shortness of
breath to her physician proximately caused her death
is clearly a question involving complex medical
issues. Therefore, we cannot say that the trial
judge abused its discretion by requiring the
testimony of a physician and, implicitly, holding
that a registered nurse was not competent to testify
as an expert on the issue of proximate cause. Bell
[v. Hart, 516 So. 2d 562 (Ala. 1987)]; Byars [v.
Mixon, 292 Ala. 661, 299 So. 2d 262 (1974)]."
588 So. 2d at 465.
Subsequently, in Hutchins v. DCH Regional Medical Center,
770 So. 2d 49 (Ala. 2000), this Court held that the trial
court did not err in denying the hospital's motion for a
28
1151212
judgment as a matter of law, where a registered nurse had
opined that the operating-room nurse had breached the
standard
of care for nursing in failing to adequately prepare a patient
for surgery by scrubbing him with Betadine antiseptic, and a
physician had opined that it was probable that improperly
preparing a patient, in the absence of other factors, could
cause an infection and, ultimately, death.
Viewing the evidence in a light most favorable to
Coleman, the nonmovant, and entertaining such reasonable
inferences as a jury would have been free to draw, as we are
required to do under our summary-judgment standard of review,
I conclude that there is no disconnect between Henson's
testimony and Dr. Moulis's testimony. Henson testified that
the nurses at the hospital were negligent and violated the
applicable standard of care in failing to alert the
physicians caring for Virginia of her worsening condition.
She testified that the nurses were negligent in not contacting
the physicians so that they could be informed as to the
efficacy of the treatments being given to Virginia in that her
condition was getting worse. Henson stated that the
physicians were not contacted and that no information had been
29
1151212
provided to them between 9:40 p.m. on March 26 and 8:30 a.m.
on March 27. Dr. Moulis's testimony is that, in light of
Virginia's worsening condition, other treatments should have
been undertaken before the endoscopy and that the delay in
treatment probably caused her death. The nexus between
Henson's testimony and Dr. Moulis's testimony is the
reasonable inference that the nurses' failure to provide the
physicians with information as to Virginia's worsening
condition prevented the physicians from providing other
treatment for Virginia. Coleman has presented substantial
evidence that the Hospital breached the applicable standard of
care in its treatment of Virginia. That is, I believe there
is no disconnect between Henson's expert testimony on the
breach of the standard of care and Dr. Moulis's expert
testimony on proximate cause.
I now turn to whether Dr. Black's affidavit presented a
question of fact, as Coleman asserts, or whether his testimony
conclusively established that the nurses' care of
Virginia did
not contribute to her death, given Dr. Black's statement that
he would not have changed his orders even if he had been
notified that Virginia's condition worsened overnight.
30
1151212
Coleman cites University of Alabama Health Services
Foundation, P.C. v. Bush , 638 So. 2d 794 (Ala. 1994). In
Bush, this Court held that the patient presented sufficient
evidence that a neurosurgeon had deviated from the applicable
standard of care. The three-year-old patient, who had a shunt
placed in her brain shortly after birth to control her
hydrocephalus, was taken to the emergency room and was then
transferred to another hospital for treatment of a possible
malfunction of the shunt. Noting that the patient had been
suffering from fever, vomiting, and diarrhea and that she
presented with a rigid neck and low fever, the neurosurgeon
initially diagnosed her condition as meningitis or shunt
malfunction and ordered that she be given the antibiotic
Mefoxin. A tap of the shunt revealed that the shunt was
functioning properly and that there was no infection in the
cerebrospinal fluid. The neurosurgeon believed that one of
the patient's several birth defects may have advanced so as to
create a compartment that spinal fluid could enter, but could
not thereafter circulate, and decided it was necessary to do
a spinal tap. The spinal tap revealed that the patient did
have an infection in the cerebrospinal fluid that was not in
31
1151212
circulation with the cerebrospinal fluid drawn from her brain
by the shunt. Based on his knowledge that 96 percent of all
shunt-related
meningitis
infections
are
caused
by
staphylococcus, the neurosurgeon ordered that the patient be
admitted and treated with Mefoxin. Subsequent tests revealed
that she was infected by hemophilus influenza (the most common
cause of meningitis in young children), not staphylococcus
bacteria. The patient's antibiotic was switched to a
combination of ampicillin and chloramphenicol, antibiotics
that are more specific for hemophilus influenza meningitis and
the standard treatment for that illness.
At trial, the plaintiff's expert opined that the
neurosurgeon's initial treatment of the child's meningitis
with Mefoxin based on the assumption that the meningitis was
caused by a shunt-related staphylococcus infection was
inappropriate because the shunt tap had revealed that the
shunt fluid was not infected and that the standard of care at
that time for treating meningitis in a child of the patient's
age was to administer a combination of ampicillin and
chloramphenicol as soon as possible after the initial
diagnosis. The neurosurgeon opined that, from his experience,
32
1151212
96 percent to 99 percent of infections in the presence of a
shunt are due to staphylococcus, that there were other places
the shunt could have been touching that could be infected,
including the outside of the shunt, that Mefoxin has a very
broad
spectrum
of
coverage
and
was
very
good
for
staphylococcus,
and
that
ampicillin
does
not
cover
staphylococcus. However, the jury found the neurosurgeon's
employer liable. On appeal, the employer argued that the
plaintiff failed to prove by expert testimony that the alleged
malpractice caused the patient's injury.
The Bush Court noted that a physician does not deviate
from the standard of care where there are several appropriate
methods of treatment available. The Court, however, found
that the testimony of the plaintiff's expert established that
the standard of care required one treatment regimen to be
followed
(the
administration
of
ampicillin
and
chloramphenicol), which the neurosurgeon did not do. Finding
that the evidence supported the jury verdict against the
neurosurgeon's employer, this Court affirmed. In short, the
parties in Bush presented conflicting medical expert opinions
33
1151212
and the credibility of those witnesses could be resolved only
by the trier of fact.
In the present case, there is a disagreement between two
medical experts -- Dr. Moulis and Dr. Black -- as to the care
that should have been provided to Virginia. This is exactly
the genuine issue of material fact that is reserved for a
jury. Dr. Black's assertion that he would not have changed
his course of treatment even if he had been told that
Virginia's condition was worsening does not conclusively
establish that the nurses' care and treatment of Virginia
during the overnight hours in no way caused or contributed to
her death.
Courts in Illinois have addressed this issue, holding
that where expert testimony establishes both a duty to notify
and the availability of treatment that would have been
successful had notice been given, the treating physician's
statement that he would not have done anything had he been
notified creates a genuine question of fact for the jury.
In Snelson v. Kamm, 204 Ill. 2d 1, 45-46, 272 Ill. Dec.
610, 634-35, 787 N.E.2d 796, 820-21 (2003), the Illinois
Supreme Court stated:
34
1151212
"Snelson's suggestion that it is impossible for
a plaintiff to prove causation where the doctor
testifies that 'he would not have acted differently
regardless of what information could have been given
him [by the nurses]' is a red herring for two
reasons. First, Snelson mistakenly assumes that a
doctor will not be willing to tell the truth about
whether the conduct of hospital nurses affected his
decisionmaking ability. Second, a plaintiff would
always be free to present expert testimony as to
what a reasonably qualified physician would do with
the undisclosed information and whether the failure
to disclose the information was a proximate cause of
the plaintiff's injury in order to discredit a
doctor's assertion that the nurse's omission did not
affect his decisionmaking. See Seef v. Ingalls
Memorial Hospital, 311 Ill. App. 3d 7, 26–27, 243
Ill. Dec. 806, 724 N.E.2d 115 (1999) (O'Mara
Frossard, P.J., dissenting). In such a case, a
factual dispute as to proximate cause would be
created sufficient for the jury to resolve. We do
not, of course, have such a factual dispute in the
present case."
(Emphasis added.)
The dissenting opinion in Seef v. Ingalls Memorial
Hospital, 311 Ill. App. 3d 7, 26-27, 243 Ill. Dec. 806, 821,
724 N.E.2d 115, 130 (1999), adopted by the Illinois Supreme
Court in Snelson, states as follows:
"Dr. Sutkus [the plaintiff's physician] speculated
about what he would have done had the nurse acted in
accordance with the standard of care, whereas Dr.
Lilling offered not speculation, but an expert
medical opinion as to how an obstetrician meeting
the standards of care should have proceeded if
properly notified. The weight to be given to Dr.
Sutkus' and Dr. Lilling's conflicting testimony was
35
1151212
a matter for the jury to determine. Suttle v. Lake
Forest Hospital, No. 1–97–3567 ([Ill. App. Ct.]
September 30, 1999) [not reported in North Eastern
Reporter]. A trial court is not required to accept
a
defendant's
hypothetical
testimony
as
uncontroverted fact, particularly when the opposing
party offers contradictory testimony. See Wodziak v.
Kash, 278 Ill. App. 3d 901, 215 Ill. Dec. 388, 663
N.E.2d 138 (1996) (finding 'scant evidentiary value'
in a medical malpractice defendant's self-serving
testimony, due to bias)."
(Emphasis added.)
Simcich v. Dephillips (No. 3-10-0456, Ill. App. Ct. June
21, 2011), is an unpublished and nonprecedential opinion, but
its facts are very close to the facts in this case:
"We
are
presented with
the
exact factual dispute
discussed by our supreme court in the latter part of
the above quoted passage from Snelson; that is, a
treating physician who testifies that the alleged
breach of the standard of care by nurses had no
effect on his decision making and a plaintiff who
presented expert testimony as to what a reasonably
qualified physician would do with the undisclosed
information and an allegation that failure to
disclose the information was a proximate cause of
plaintiff's injuries. Unlike the evidence presented
in Snelson, nurse Osinksi testified that failure to
orally disclose certain information deviated from
the applicable standard of care. Dr. DeLong
testified that the nurses' deviation from the
applicable standard of care proximately caused
plaintiff's injuries. Dr. Malek disagreed and
testified
that
he
would
have
done
nothing
differently prior to December 28 as that is when the
plaintiff first presented with bilateral foot drop
and the incision site became swollen. Given Dr.
DeLong's and nurse Osinksi's testimony, the jury in
36
1151212
this matter was free to believe or reject Dr.
Malek's assertion that no action became warranted
until December 28. As such, the trial court did not
err in allowing the jury verdict to stand and
denying [the hospital's] motion for a judgment
[notwithstanding the verdict]."
(Emphasis added.)
Affirming the summary judgment in effect treats Dr.
Black's testimony as to the hypothetical question of what he
would have done had he been notified as dispositive of the
issue whether the failure to notify made a difference. Dr.
Black did nothing after 8:30 a.m., so his answer to the
hypothetical is consistent with his conduct after having full
knowledge. But why would it not be a jury question as to
whether Dr. Black's answer is self-serving and the product of
bias? Self-serving statements of an interested party that
refer to matters exclusively within that party's knowledge
create an issue of credibility that should not be decided by
the court but should be left for the trier of fact.
Accordingly, I submit that the summary judgment was therefore
inappropriate.
Murdock and Wise, JJ., concur.
37 | December 1, 2017 |
e433d6ca-31fd-45df-b023-da13225f6af8 | Ex parte Buck. | N/A | 1151011 | Alabama | Alabama Supreme Court | REL: October 27, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
____________________
1151011
____________________
Ex parte Frank S. Buck and Martha Jane Buck
PETITION FOR WRIT OF CERTIORARI
TO THE COURT OF CIVIL APPEALS
(In re: Frank Buck and Martha Buck
v.
CH Highland, LLC, and City of Birmingham)
(Jefferson Circuit Court, CV-15-901463;
Court of Civil Appeals, 2150220)
SHAW, Justice.
Frank S. Buck and Martha Jane Buck, the plaintiffs in an
action below challenging the validity of a rezoning ordinance,
petitioned this Court for certiorari review of the decision of
the Court of Civil Appeals affirming the trial court's
1151011
judgment in favor of the defendants, CH Highland, LLC
("Highland"), and the City of Birmingham ("the City")
(hereinafter referred to collectively as "the respondents").
Buck v. CH Highland, LLC, [Ms. 2150220, June 10, 2016] ___ So.
3d ___ (Ala. Civ. App. 2016). We reverse and remand.
Facts and Procedural History
The Bucks own real property located in the City. Frank
operates a law office in a former residential house located on
the property. Highland, a real-estate-development company,
intends to build a multistory apartment complex ("the
project") on property located adjacent to the Bucks' property
("the subject property"). As planned, the project did not
conform with the then existing zoning restrictions for the
area in which the subject property was located. Thus, on
September 8, 2014, Highland submitted a rezoning application
to the Zoning Advisory Committee of the Birmingham Planning
Commission. Highland requested that the subject property be
rezoned from a "B-2 general business district" to a "B-3
community business district" so that it could construct the
project.
Subsequently, the Zoning Advisory Committee recommended
2
1151011
that the City Council approve a "QB-3 qualified community
business
district"
with
certain
"Q
conditions."1
The
recommended Q conditions included the submission and approval
of
a
site-development plan
covering
numerous
issues,
including
structure locations and heights, fencing, landscaping, and
shielding a parking garage from view.
Highland also submitted a request to the Planning and
Zoning Committee of the Birmingham City Council to rezone the
subject property from a B-2 district to a B-3 district. It
appears that this committee met several times, and Highland's
application, as well as the recommendation of the Zoning
Advisory Committee on Highland's application, was discussed.
It appears that on December 17, 2014, the application was
approved "contingent on [a] signed restrictions agreement
between the applicant and adjacent property owner." The Bucks
contend that the "adjacent property owner" referred to was
Temple Beth-El, a Jewish synagogue. Further, like the Zoning
Advisory
Committee,
the
Planning
and
Zoning
Committee approved
a QB-3 district with the same Q conditions.
1According
to
the
respondents,
the
City's
zoning
ordinance
allows certain restrictions on potential property uses in
districts zoned as B-3. These are called "Q conditions."
3
1151011
Before the application was approved, a "zoning notice"
indicating the existence of a proposed rezoning ordinance and
notice of a public hearing was published in the Birmingham
News on November 21, 2014. The notice stated that the subject
property would be rezoned from a B-2 district to a B-3
district. On November 28, 2014, a "synopsis of zoning
ordinance" was published, indicating that the City Council
would consider the adoption of an ordinance to change the
zoning of the subject property from B-2 to B-3. The notices
did not mention rezoning the subject property to a QB-3
district or the existence of any Q conditions.
At some point, Highland and Temple Beth-El drafted and
signed a "memorandum of understanding" ("the MOU"). The MOU
discussed agreements between Highland and Temple Beth-El
regarding, among other things, the mitigation of construction
noise and the use of an alley, parking lots, and Temple Beth-
El property during the construction of the project.
Additionally, the MOU included an agreement that any rezoning
ordinance regarding the subject property would include Q
conditions that would prohibit a list of property uses that
would ordinarily be permitted in a B-3 district. Temple Beth-
4
1151011
El's representative signed the MOU on December 22, 2014. It
appears from the record that the MOU was not delivered to at
least some members of the City Council until the night before
the December 30 hearing on the rezoning ordinance.
On December 30, 2014, the City Council held a public
hearing to consider the proposed rezoning ordinance. The
transcript of the hearing indicates that the proposed
ordinance was "amended" to include the Q condition suggested
by the Zoning Advisory Committee and the Planning and Zoning
Committee, as well as a Q condition incorporating the
property-use restrictions found in the MOU. The City Council
voted to adopt the amended proposed ordinance as Ordinance
1949-G, which rezoned the area in which the subject property
was located from a B-2 district to a QB-3 district. Ordinance
1949-G listed two "Q conditions": the requirement to submit a
site-development plan, as mentioned in the recommendations of
the Zoning Advisory Committee and the Planning and Zoning
Committee, and the list of prohibited property uses found in
the MOU.
Subsequently, the Bucks sued the City, the mayor, the
City Council, Highland, and several fictitiously named
5
1151011
defendants, alleging, among other things, that "[t]he actions
by the City and its Council, through its Council persons and
Mayor, and fictitious parties are violative of applicable
statutory, regulatory and the common laws of the state of
Alabama." The Bucks sought, among other things, declaratory
and injunctive relief. The mayor and the City Council members
were subsequently dismissed as defendants, and the
Bucks' case
proceeded with the City and Highland as defendants.
Highland filed a motion for a summary judgment, which the
City joined. Citing Ala. Code 1975, § 11-52-77 and § 11-52-
78, which govern publishing notice of proposed zoning
ordinances, they argued:
"All
required
prerequisites
for
amending
the
Birmingham Zoning Ordinance were strictly followed
by the City Council. ... The proposed rezoning
ordinance and notice of public hearing were
published in the Birmingham News on November 21,
2014, followed by publication of a synopsis of the
proposed ordinance on November 28, 2014."
In response to the motion for a summary judgment, the
Bucks disputed whether proper notice had been published:
"The notices were published on November 21,
2014, and November 28, 2014, respectively and gave
notice of a change from B-2 to B-3. However, at the
public hearing, the noticed change from B-2 to B-3
was amended so as to reflect that it was subject to
two Q conditions, one of which was based upon a MOU
6
1151011
between the developer [and] an adjoining property
owner, which said MOU was not executed until
December
22,
2014,
and
not
presented
for
consideration to the City until the evening of
December 29, 2014. The MOU was never presented to
the public. The transcript of the council hearing
reflects an amended ordinance based upon the MOU,
which had not been noticed in accordance with §
11-52-77 and § 11-52-78. ..."
Ultimately, the trial court entered a summary judgment
for the respondents. As to the Bucks' argument that the City
failed to properly publish notice of the proposed ordinance,
the trial court held:
"The [Bucks] ... argue that the City of
Birmingham failed to meet its statutory obligation
to publish notice of the proposed ordinance. The
City did publish the requisite notice in advance of
the City Council's vote, however, and the court
agrees with the defendants that additional notice
was not required under the particular circumstances
here."
The Bucks appealed to this Court, and the appeal was
transferred to the Court of Civil Appeals. See Ala. Code
1975, § 12-2-7(6). On appeal in that court, the Bucks
challenged the trial court's judgment on several grounds,
including whether proper notice of Ordinance 1949-G was
published as required by § 11-52-77. The Bucks specifically
argued, among other things, that the ordinance as adopted was
different from the ordinance as proposed in that it "was
7
1151011
subject to two Q conditions" and that notice of the adopted
ordinance was not given under §§ 11-52-77 and -78. The Bucks
further argued that the "amended" ordinance was required to be
published in its "final form." On this issue, the Court of
Civil Appeals affirmed the trial court's judgment:
"[T]he Bucks contend that the circuit court erred by
concluding that §§ 11-52-77 and 11-52-78 did not
require the City to provide the Bucks 'new notice
and a new hearing.' Together, §§ 11-52-77 and 11-
52-78 provide the notice requirements for the
adoption of, changes to, and amendments of zoning
ordinances. Our supreme court has held that the
statutory 15-day notice requirements contained in §
11-52-77 are mandatory. Kennon & Assocs., Inc. v.
Gentry, 492 So. 2d 312, 315 (Ala. 1986); see also
Builders Dev. Co. v. City of Opelika, 360 So. 2d
962, 964 (Ala. 1978); Alabama Alcoholic Beverage
Control Bd. v. City of Birmingham, 253 Ala. 402,
407, 44 So. 2d 593, 597 (1950). ...
"....
"The circuit court determined that the City had
properly published the requisite notice in advance
of the city council's vote and that no additional
notice of the Q conditions had been required. In
City of Mobile v. Cardinal Woods Apartments, Ltd.,
727 So. 2d 48, 54 (Ala. 1999), our supreme court
affirmed the trial court's judgment that had
determined that a zoning ordinance was invalid
because the notice had failed to apprise the public
that the requested rezoning would allow not only
specialty shops but also a chain restaurant. The
Cardinal Woods court concluded that the notices in
that case had 'tended only to "mislead."' 727 So. 2d
at 54 (citing 1 E. Zieglar, Jr., Rathkopf's the Law
of Zoning and Planning § 10.03 (1992)).
8
1151011
"In this case, the public was not similarly
misled. The published notice indicated that
rezoning of the district containing the subject
property from B-2 to B-3 would be considered. The
Bucks
do
not
dispute
that
that
notice
was
sufficient. Even though no notice was given of the
contents of the MOU or that the Q conditions would
be
required,
the
published
notice
apprised
interested persons 'how, and for what, to prepare.'
Id. The Bucks make no argument that the intended
use of the subject property differed significantly
because of the addition of the Q conditions. Thus,
we conclude that the circuit court did not err by
declining to conclude that the City had violated §§
11-52-77 and 11-52-78."
Buck, ___ So. 3d at ___ (footnote omitted).
The Bucks sought certiorari review in this Court, raising
numerous challenges to the Court of Civil Appeals' decision.
This Court granted certiorari review on a single issue:
Whether notice of Ordinance 1949-G was properly published
pursuant to § 11-52-77 and § 11-52-78.
Standard of Review
"On certiorari review, this Court accords no presumption
of correctness to the legal conclusions of the intermediate
appellate court." Ex parte Toyota Motor Corp., 684 So. 2d
132, 135 (Ala. 1996). "The law is well established that a de
novo standard applies to appellate review of a trial court's
summary judgment." Ex parte Patel, 988 So. 2d 957, 959 (Ala.
9
1151011
2007).
Discussion
A. Mootness
The respondents have filed a supplemental brief in this
Court asserting that, while this case was pending in this
Court, Ordinance 1949-G has been repealed and replaced with a
new ordinance, Ordinance 1981-G ("the new ordinance"). The
new ordinance is virtually identical to Ordinance 1949-G,
rezones the subject property from B-2 to QB-3 with the same Q
conditions as were in Ordinance 1949-G, and states that it
repeals and replaces the prior ordinance. Further, the
respondents include a copy of published notices for the new
ordinance that indicate the subject property was to be rezoned
from B-2 to QB-3 and that set forth the text of the new
ordinance, including the Q conditions. According to the
respondents, any procedural irregularities in the publication
of Ordinance 1949-G are no longer relevant and the new
ordinance allows Highland to proceed with the project.
Although the parties argue to the contrary, this circumstance
raises the issue whether this appeal is now moot.
"This Court has often said that, as a general rule, it
10
1151011
will not decide questions after a decision has become useless
or moot." Arrington v. State ex rel. Parsons, 422 So. 2d 759,
760 (Ala. 1982).
"'"A moot case or question is a case or question
in or on which there is no real controversy; a case
which seeks to determine an abstract question which
does not rest on existing facts or rights, or
involve conflicting rights so far as plaintiff is
concerned."' Case v. Alabama State Bar, 939 So. 2d
881, 884 (Ala. 2006) (quoting American Fed'n of
State, County & Mun. Employees v. Dawkins, 268 Ala.
13, 18, 104 So. 2d 827, 830-31 (1958)). 'The test
for mootness is commonly stated as whether the
court's action on the merits would affect the rights
of the parties.' Crawford v. State, 153 S.W.3d 497,
501 (Tex. App. 2004) (citing VE Corp. v. Ernst &
Young, 860 S.W.2d 83, 84 (Tex. 1993)). 'A case
becomes moot if at any stage there ceases to be an
actual
controversy
between
the
parties.'
Id.
(emphasis
added)
(citing
National
Collegiate
Athletic Ass'n v. Jones, 1 S.W.3d 83, 86 (Tex.
1999)).
"... 'A moot case lacks justiciability.'
Crawford, 153 S.W.3d at 501. Thus, '[a]n action that
originally was based upon a justiciable controversy
cannot be maintained on appeal if the questions
raised in it have become moot by subsequent acts or
events.' Case, 939 So. 2d at 884 (citing Employees
of Montgomery County Sheriff's Dep't v. Marshall,
893 So. 2d 326, 330 (Ala. 2004))."
Chapman v. Gooden, 974 So. 2d 972, 983-84 (Ala. 2007).
If Ordinance 1949-G, the subject of this appeal, has in
fact been repealed and replaced by the new ordinance, then
this appeal is moot, because there no longer exists a
11
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justiciable controversy as to the single issue upon which
certiorari review was granted. However, the Bucks argue that
the new ordinance was also improperly enacted and is also
void; thus, they say, it did not repeal Ordinance 1949-G and
their challenge to Ordinance 1949-G remains. In fact, they
contend that they have filed a new action in the Jefferson
Circuit Court challenging the validity of the new ordinance,
and they submitted a copy of the complaint they have filed in
that new action.2
This Court is not in a position, in the present appeal,
to determine whether the new ordinance is valid or invalid and
whether it did or did not properly repeal and replace
Ordinance 1949-G. That issue is pending in another circuit
court action, where a proper record and arguments relating to
that issue can be developed. Because there remains the
possibility that the new ordinance could be held invalid, a
holding that this appeal is moot based on the adoption of the
new ordinance is premature. Specifically, if we were to
2Neither the materials submitted by the respondents
regarding the passage of the new ordinance nor the materials
submitted by the Bucks disclosing their suit challenging its
validity are contained in the record in this appeal.
12
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dismiss this case as moot, but the Bucks were to prevail in
their new action challenging the new ordinance, the issue of
the validity of Ordinance 1949-G would remain unresolved, and
the Bucks would have lost their ability to maintain their
challenge to it in the instant appeal. In other words, at
this time it is uncertain whether the new ordinance is valid
and moots this case, and we are not in a position to resolve
that uncertainty. Given that uncertainty, we are unable to
say that our decision in this appeal would not affect the
rights of the parties and that the case has therefore been
rendered moot.
B. The validity of Ordinance 1949-G
The issue in this appeal, as noted above, is whether the
City, in adopting Ordinance 1949-G, complied with the notice
and publication requirements of § 11-52-77 and § 11-52-78.
Section 11-52-77 states, in particular part:
"No ordinance shall be passed by any municipal
corporation under the authority of this article
unless and until the municipal governing body has
complied with the procedures set forth in either
subdivision (1) or subdivision (2) of this section.
"(1) Prior to adoption, the proposed
ordinance shall be published in full for
one insertion and an additional insertion
of a synopsis of the proposed ordinance,
13
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one week after the first insertion, which
synopsis shall refer to the date and name
of the newspaper in which the proposed
ordinance was first published; both such
insertions shall be at least 15 days in
advance of its passage and in a newspaper
of
general
circulation
published
within
the
municipality, or, if there is no such
newspaper, then by posting the proposed
ordinance
in
four
conspicuous
places
within
the municipality, together with a notice
stating the time and place that the
ordinance is to be considered by the
municipal
legislative
authorities
and
stating further that at such time and place
all persons who desire shall have an
opportunity of being heard in opposition to
or in favor of such ordinance."
(Emphasis added.) Section 11-52-78 requires:
"Such regulations, restrictions, and boundaries
and ordinances passed under the authority of this
article
may
from
time
to
time
be
amended,
supplemented, changed, modified, or repealed.
"The provisions of Section 11-52-77 relative to
public hearings and official notices shall apply
equally to all changes and amendments."
In the often cited decision of Kennon & Associates, Inc.
v. Gentry, 492 So. 2d 312 (Ala. 1986), the Court discussed the
proper application of §§ 11-52-77 and -78. In Kennon, a
municipal ordinance was proposed to amend the municipality's
comprehensive zoning ordinance to rezone a property lot.
After the proposed rezoning ordinance was adopted, several
14
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neighboring property owners challenged it on various grounds,
including whether the proper notice requirements were met.
492 So. 2d at 314. Specifically, in addition to the statutory
notice requirements of § 11-52-77 and § 11-52-78, the
municipality's comprehensive zoning ordinance mandated that
adjacent property owners be notified by registered mail of
pending rezoning actions. 492 So. 2d at 315. The trial court
invalidated the rezoning ordinance, and the property owner
that sought the rezoning ordinance appealed.
This Court noted that it was undisputed that some of the
adjacent landowners did not receive the required notice of the
rezoning action by registered mail. This Court then generally
discussed legal requirements for properly passing a zoning
ordinance:
"This Court has held that the statutory 15-day
notice requirements contained in § 11-52-74[3] and §
11-52-77 are mandatory and 'must both be complied
with when a city publishes notice of a proposed
zoning ordinance or amendment.' Builders Development
Co. v. City of Opelika, 360 So. 2d [962,] 964 [(Ala.
1978)] .... This Court has also held that when the
legislative body of a city or a planning commission
3Alabama Code 1975, § 11-52-74, which has since been
repealed, also provided that zoning ordinances be published
before passage. See generally Builders Dev. Co. v. City of
Opelika, 360 So. 2d 962 (Ala. 1978), for a discussion of the
joint application of §§ 11-52-74, -77, and -78.
15
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adopts zoning or planning regulations, ordinances,
or by-laws, which are 'specifically authorized by
the Code, they have the same force and effect as
properly
enacted
statutes.'
(Emphasis
added.)
Lynnwood Property Owners v. Lands Described In
Complaint, 359 So. 2d 357, 359 (Ala. 1978); Boulder
Corporation v. Vann, 345 So. 2d 272 (Ala. 1977);
Code of 1975, §§ 11-52-1, et seq."
Kennon, 492 So. 2d at 315-16. This Court then discussed
treatises on zoning law that restated the proposition that the
notice requirements applicable to zoning ordinances must be
strictly
followed,
including
requirements
that
are
provided
in
addition to those imposed by statute. The Court in Kennon
then stated:
"In this jurisdiction, we have insisted on strict
compliance with procedural requirements contained in
statutes and regulations adopted pursuant to the
enabling statutes. In Builders Development Co. v.
City of Opelika, 360 So. 2d at 964-65, this Court
held:
"'[Section] 11-52-74 and § 11-52-77 must
both be complied with when a city publishes
notice of a proposed zoning ordinance or
amendment.
Otherwise
the
ordinance
is
void.
[Citations omitted.]
"'....
"'[Under these statutes], interested
parties should have at least fifteen days
to prepare for a hearing, not twelve,
thirteen, or fourteen.'"
Kennon, 492 So. 2d at 317 (alterations in Kennon).
16
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However, the owner of the lot in question, Kennon, argued
that "because none of the affected parties was prejudiced by
the failure to give the proper notice, strict compliance ought
not be required." Kennon, 492 So. 2d at 317. This Court
disagreed:
"We
find
Kennon's
arguments
unpersuasive.
In
the
line of decisions discussed herein, where there had
been a failure to strictly follow the procedural
requirements applicable to the action sought,
especially
notice
provisions,
this
Court
has
invalidated the ordinance passed or the action
taken, irrespective of whether any person was
prejudiced by the error or omission. Thus, ...
there is ample authority for the view that, in
adopting or amending a zoning ordinance, mandated
procedural steps, especially notice requirements,
must be strictly followed."
492 So. 2d at 318 (citations omitted). The trial court's
judgment invalidating the rezoning ordinance was affirmed.
Although Kennon dealt with the failure to give notice by
mail of a proposed rezoning ordinance, in City of Mobile v.
Cardinal Woods Apartments, Ltd., 727 So. 2d 48 (Ala. 1999), a
proposed rezoning ordinance was published as required by § 11-
52-77 but was subsequently changed after that publication and
before its adoption. That case involved two parcels of land
zoned for residential use by the City of Mobile. The proposed
rezoning ordinance to change the zones for the parcels to a
17
1151011
"B-1 Buffer Business District" and a "B-2 Neighborhood
Business District," respectively, contained a list of seven
conditions. The published notice stated that the city council
"may" consider zoning classifications other than those sought
by the rezoning applicant. After the proposed rezoning
ordinance was published, the Mobile City Council deleted the
seventh provision of the proposed rezoning ordinance, which
required compliance with certain "letters of agreement" that
limited the proposed use of the parcels--specifically, that
the property would be used for retail shops--and added a
condition that provided compliance with a different "letters
of agreement" that contained no reference to any specific use
for the parcels.
After the altered rezoning ordinance was adopted, a
neighboring
property
owner
filed
suit
challenging
the
rezoning
ordinance and alleging that proper notice was not given under
§§ 11-52-77 and -78. It was further revealed that the
property owner leased both parcels for the construction of a
"Roadhouse Grill" restaurant, which, it was alleged, would not
have been allowed under the proposed ordinance as published.
The trial court invalidated the rezoning ordinance, and the
18
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City of Mobile appealed. This Court noted:
"'[T]he purpose of
notice statutes is
to
apprise
fairly and sufficiently those persons who may be
affected by zoning action so that they may
intelligently prepare for the hearing on the
matter.' 1 E. Ziegler, Jr., Rathkopf's the Law of
Zoning and Planning § 10.03, at 10–15 (1992)
(emphasis added). '[N]otice that does not warn of
the nature of the proposed amendment is no notice.
Otherwise, such a notice, instead of informing,
would actually mislead.' Id. § 10.04 (emphasis
added). 'One could not advertise a proposed change
from residential to commercial and then zone the
property industrial, since this would clearly be a
misleading notice.' Id. at 10–25. 'But where the
change of use is clearly specified, details as to
non-use
restrictions,
such
as
setbacks,
or
sideyards, cannot be said to be substantial in the
sense that people reading the notice would be misled
and induced to stay away from the hearing and not
present their views.' Id. (Emphasis added.)
"'[I]n adopting or amending a zoning ordinance,
mandated
procedural
steps,
especially
notice
requirements, must be strictly followed.' Kennon &
Assocs., Inc. v. Gentry, 492 So. 2d 312, 318 (Ala.
1986) (emphasis in original). It is immaterial
'whether any person was prejudiced by the error or
omission.' Id. (Emphasis in original.)"
Cardinal Woods, 727 So. 2d at 54.
On appeal, the City of Mobile argued that the portion of
the notice indicating that the city council "may" consider
zoning classifications other than that sought by the applicant
allowed it to consider zoning and to decide to zone the
property for uses other than B-1 and B-2, as provided in the
19
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notice. Applying the above authority, the Court stated:
"If this statement means, and the City contends that
it does, that the City Council could have considered
and decided to zone the [parcels] for industrial
use, for example, rather than for the B–1 and B–2
business uses as advertised, then it is patently
invalid--it simply does not apprise interested
persons as to how, and for what, to prepare.
Similarly, use of property for 'small specialty
retail shops' differs significantly from use for a
Roadhouse Grill restaurant. In other words, it is a
difference in use, amounting to more than a mere
matter of 'setbacks or sideyards.'
"To be sure, [the owner of the parcels] had the
right to seek to rezone the [parcels] for B–2 use,
including the Roadhouse Grill restaurant. However,
he and his corporation were bound to do so openly
and forthrightly. Once they advertised a proposed
ordinance and incorporated with the notice the
letters of agreement, which set forth specifically
the only uses discussed with the neighborhood
residents, the City Council was limited to the uses
set forth in the letters of agreement. Otherwise,
the advertisements were not 'notice' and the
resulting ordinance was void.
"That is this case. [The rezoning ordinance]
purports
to
allow
the
construction
of
any
establishment that could be operated as a B–2
business.
However,
the
September
8
and
15
publications expressly subjected the use of the
[parcels] to certain provisos, one of which was
'compliance with the letters of agreement as
submitted by the applicant at the [Planning
Commission] meeting.' These letters, of course,
referred specifically to 'small specialty retail
shops.' [The rezoning ordinance] contained no such
proviso.
"Additionally, because the September 8 and 15
20
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publications--which purported to authorize [the
rezoning ordinance]--referred by incorporation to
'small specialty retail shops,' the publications
failed to alert those residents who might have
opposed the operation of a restaurant on the
[parcels]. Thus, the 'notices' tended only to
'mislead.'"
727 So. 2d at 54.
Cardinal Woods holds that the purpose of a notice
requirement for a proposed rezoning ordinance is to "fairly
and sufficiently" apprise persons who may be impacted by the
zoning decision so that they can prepare for the hearing, and
it must not "mislead." If a proposed rezoning ordinance is
modified after the notice is published, the notice is
deficient if the use for the zoned property allowed by the
modified ordinance "differ[ed] significantly" from the use
allowed in the notice originally published. The opinion
suggests that an example of an insignificant change would be
the addition of restrictions to the ordinance, such as "non-
use restrictions" like "setbacks, or sideyards," which are
not
"substantial" because people reading the notice would not be
"misled and induced to stay away from the hearing and not
present their views." In that case, however, the changes to
the rezoning ordinance after the notice expanded the use of
21
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the parcels; the changes were a difference "amounting to more
than a mere matter of 'setbacks or sideyards.'" 727 So. 2d at
54.
The respondents contend that, in the instant case, the
addition of the Q conditions to Ordinance 1949-G were no
different than changes amounting to no more than the "setbacks
or sideyards" that Cardinal Woods would have approved. The
Bucks, on the other hand, contend that such a rule was
rejected in the subsequent decision in Ex parte Bedingfield,
782 So. 2d 290 (Ala. 2000). In that case, this Court granted
certiorari review of a decision of the Court of Civil Appeals,
Bedingfield v. Mooresville Town Council, 782 So. 2d 284, 285
(Ala. Civ. App. 1999), that had upheld the trial court's
judgment
denying
a
challenge
to
the
validity
of
a
comprehensive zoning ordinance. Notice of the
proposed zoning
ordinance and a map had been published. In its subsequent
consideration of the proposed ordinance, the town council
changed the zoning classification of two lots "from
residential to business" because, according to the Court of
Civil Appeals, the lots had been "erroneously excluded from
the business district on the original zoning map." 782 So. 2d
22
1151011
at 286. After the altered ordinance was adopted, certain
plaintiffs, including the owner of the lots, challenged its
validity. Specifically, they argued, among other things, that
the town had violated §§ 11-52-77 and -78. The trial court
held that changes to the proposed comprehensive zoning-
ordinance map did not require new notices for changes that
were small in relation to a proposed zoning map as a whole.
The Court of Civil Appeals affirmed. This Court granted
certiorari review and explained the pertinent issue as
whether
the
Court
of
Civil
Appeals
erred
in
"applying
a
substantial-compliance
analysis
to
the
zoning-ordinance
notice
requirements of §§ 11–52–77 and 11–52–78" and, therefore, its
decision conflicted with Kennon "and its progeny." Ex parte
Bedingfield, 782 So. 2d at 291. This Court noted the language
from Kennon stating that the notice requirement of § 11-52-77
was "mandatory" and must "be complied with" and that, when
there has been a failure to "strictly" follow the notice
provisions in passing an ordinance, it was invalidated,
despite whether any person had been prejudiced. The Court
then held:
"The opinion of the Court of Civil Appeals
permitting 'substantial compliance' with §§ 11–52–77
23
1151011
and 11–52–78 directly conflicts with Kennon, supra,
and its progeny. This Court has required strict
compliance with the notice and hearing requirements
of § 11–52–77 and that strict compliance requirement
extends to § 11–52–78. Kennon, supra, and its
progeny. Section 11–52–78 requires the Town Council
to comply with the notice and hearing requirements
of § 11–52–77 before the Town Council may amend,
change, supplement, modify, or repeal the zoning
ordinance. Although the error in the proposed zoning
ordinance which classified Yarbrough's property as
'residential' rather than 'business' was, without
dispute, an honest or clerical error, correcting the
error required a change to the proposed ordinance.
The Town Council changed the classification of
Yarbrough's
property
from
'residential'
to
'business' and then adopted the ordinance without
its having been posted in its changed form with
notice that it would be considered in that form as
required by § 11–52–77. Thus, because the Town
Council did not comply with the notice and hearing
requirements of § 11–52–77 before it purported to
adopt the ordinance with the changed classification
of Yarbrough's property from 'residential' to
'business,' the zoning ordinance is invalid for lack
of the notice required by § 11–52–77 for the
ordinance (in the form purportedly adopted) or for
lack of the notice required by § 11–52–78 for the
change itself. Kennon, supra. Therefore, the trial
court erred in entering summary judgment in favor of
the defendants, and the Court of Civil Appeals erred
in affirming the judgment of the trial court."
Ex parte Bedingfield, 782 So. 2d at 293–94 (some emphasis
added).
Although this analysis has several moving parts, it is
clear that the Court faulted the town's adoption of the
ordinance "without its having been posted in its changed form"
24
1151011
and without notice that the ordinance would be "considered" in
its new form, which was "required by § 11-52-77." Further,
the adoption of the ordinance with a changed classification of
certain property was "invalid for lack of the notice required
by § 11-52-77 for the ordinance (in the form purportedly
adopted)." The Bucks contend that, like the ordinance in Ex
parte Bedingfield, the proposed Ordinance 1949-G was changed
after the notice was published. The City did not publish the
"changed" ordinance, and, thus, under Ex parte Bedingfield, it
failed to "strictly comply" with the mandatory notice
provisions of § 11-52-77.4 Under this analysis, we agree that
4The respondents contend that Ex parte Bedingfield should
not be followed because, they say, it misapplied § 11-52-78.
Specifically, that decision appears to hold that § 11-52-78
requires an amendment to a proposed ordinance be published
under § 11-52-77. Section 11-52-78, however, provides that
zoning ordinances that have been "passed" may be amended and,
when that occurs, the same notice provisions of § 11-52-77
apply to that amendment. It does not speak to whether notice
must be given when a proposed ordinance is amended. Further,
§ 11-52-78 had no application in Ex parte Bedingfield, because
the ordinance at issue in that case was a comprehensive zoning
ordinance that was being adopted in the first place, and was
not an amendment or change to an existing (previously adopted)
zoning ordinance. This interpretation of § 11-52-78 has been
repeated in subsequent lower-court decisions. Speakman v.
City of Cullman, 829 So. 2d 176, 180 (Ala. Civ. App. 2002),
and Town of Stevenson v. Selby, 839 So. 2d 647, 649 (Ala. Civ.
App. 2001). However, although this interpretation is one of
the arguments advanced by the Bucks, we do not apply it in
this case.
25
1151011
the City's adoption of Ordinance 1949-G did not comply with §
11-52-77.
The respondents argue, on the other hand, that Cardinal
Woods is authority for the proposition that a city does not
need to publish a new notice and hold a new hearing when it
adds "details" to a published ordinance but does not add any
new potential uses the proposed ordinance originally allowed.
Specifically, the respondents contend that, under Cardinal
Woods, a city gives proper notice when, after publishing the
full proposed ordinance and notice of the public hearing, the
city later adds details to the ordinance that merely limit
some of the uses the published ordinance would have allowed.
The respondents contend that the changes to
Ordinance 1949-G--
the addition of the Q conditions--are in the same nature of
changes as adding "non-uses" of the property. They argue
that, here, the Q conditions actually deleted potential
property uses that would ordinarily be allowed in a B-3
district and do not allow additional or "different" uses.
Thus, they say, the Q conditions, under the apparent logic of
Cardinal Woods, would not be significant or substantial and
would not mislead a person from attending the hearing. We
26
1151011
disagree.
The respondents' seek support from Cardinal Woods by
implication--the Court in Cardinal Woods quoted a treatise
stating that certain alterations might legitimately be
made to
previously published proposed ordinances. The Court did not
actually apply such a rationale in that case--the alterations
to the ordinance actually changed the use of the property--but
the implication is that, if the changes did not "differ
significantly," the Court would have approved. The viability
of such an implication cannot be squared with the Court's
subsequent decision in Ex parte Bedingfield, which explicitly
rejected the notion that "substantial compliance" with § 11-
52-77 is permissible.5 Any implication that can be drawn from
Cardinal Woods that alterations are permissible if
the
altered
ordinance did not "differ significantly" from the published
ordinance is no different from a rule allowing "substantial
compliance" with § 11-52-77.
Additionally, the rule advanced by the respondents--that
5The respondents contend that if this Court "discards the
Cardinal Woods framework," it should do so only on a
prospective basis, because they relied on it in this case.
However, Ex parte Bedingfield clearly called into question the
respondents' interpretation of Cardinal Woods.
27
1151011
changes to "non-use," i.e., the addition of restrictions in an
already published ordinance, do not require notice--is
inconsistent with the idea that the notices should "fairly and
sufficiently" apprise the public of the content of a city's
proposed zoning action. Although the Cardinal Woods decision
tacitly approved changes to details such as "setbacks" and
"sideyards," the changes to the published ordinance in the
instant case were of a much different magnitude: the Q
condition incorporated from the MOU changed the zoning
district from one that would allow 37 possible uses of
property in the district to one that would allow only 9. What
resulted was a radically different B-3 district from that
which the public was told the City intended to create. Those
changes were never disclosed to the public before the hearing
or even to the City Council until literally the night before
the hearing. Thus, even if this Court were to accept such a
rule from Cardinal Woods, it would not apply in this case.
Moreover, the idea that no notice is needed for changes
that add restrictions to zoning districts seems to be premised
on the idea that the public would not be interested in such
changes, not want or need notice of them, and thus would not
28
1151011
want to attend a public hearing discussing such changes.
However, this appears to embrace the notion that the public
would not be prejudiced if such changes were made without its
knowledge because those changes would not negatively impact
the public. That premise is directly rejected by our caselaw,
above, holding that it is immaterial whether any person is
prejudiced by the failure to comply with the notice
requirements
regarding
zoning
ordinances.
Ex
parte
Bedington,
supra; Cardinal Woods, supra; and Kennon, supra. Further,
that premise is based on speculation; members of the public
may very well be interested when previously undisclosed
restrictions are added to zoning ordinances.
Finally, and most importantly, the plain language of §
11-52-77 requires that the ordinance ultimately adopted be
the
same as the proposed ordinance that was published. The Code
section states: "Prior to adoption, the proposed ordinance
shall be published in full ...." The ordinance that is
adopted is to be the proposed ordinance that was, prior to
adoption, "published in full." In this case, the proposed
ordinance that was published in full was not the ordinance
that was adopted; instead, the proposed ordinance that was
29
1151011
published was later amended, and the amended ordinance was
adopted. To hold that only a proposed ordinance need be
published, but something else, whether an ordinance that is
insignificantly different from the proposed ordinance or an
ordinance that is radically different, could be adopted, is
contrary to the plain language of § 11-52-77.
In the instant case, the proposed rezoning ordinance that
was published merely indicated to the public that there would
be a zoning change from a B-2 district to a B-3 district.
Ordinance 1949-G does not create a B-3 district; instead, it
creates a district of a substantially smaller range of uses
than what was otherwise disclosed to the public in the notice.
Even if this Court were to reject the long-standing rule that,
to invalidate an ordinance, it is unnecessary for the public
to be prejudiced by the City's failure to publish the
ordinance, we cannot presume that no prejudice occurred in
this case.
Conclusion
The decision of the Court of Civil Appeals is reversed,
and the case is remanded to that court for proceedings
consistent with this opinion.
30
1151011
REVERSED AND REMANDED.
Stuart, C.J., and Bolin, Main, Wise, and Bryan, JJ.,
concur.
Parker and Sellers, JJ., dissent.
31
1151011
SELLERS, Justice (dissenting).
I respectfully dissent. Because a new zoning ordinance
has superseded the ordinance at issue in this appeal, there is
no longer a justiciable controversy. The new ordinance
rendered this appeal moot. I would quash the writ of
certiorari.
Parker, J., concurs.
32 | October 27, 2017 |
a978f7cb-4bda-4323-9254-c57d307e5fdd | Wood v. Alabama | N/A | 1160814 | Alabama | Alabama Supreme Court | REL: November 21, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
____________________
1160814
____________________
James C. Wood
v.
State of Alabama et al.
Appeal from Montgomery Circuit Court
(CV-12-900749)
SELLERS, Acting Chief Justice.1
1Canon 3.C of the Canons of Judicial Ethics requires a
Justice to disqualify himself or herself in any proceeding in
which
the
Justice's
impartiality
might
be
reasonably
questioned. Having determined that the issue in this case
affects all justices who were actively serving in that
capacity as of October 1, 2011, and recognizing that eight of
the Justices on this Court were serving as active justices as
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James C. Wood, a retired circuit court judge, appeals
from a summary judgment in favor of: the State of Alabama;
Luther Strange, in his capacity as Attorney General for the
State of Alabama;2 David G. Bronner, in his capacity as chief
executive officer of the Employees' Retirement System of
Alabama; the Board of Control of the Employees' Retirement
System of Alabama ("the Board of Control"); and Thomas L.
White, Jr., in his capacity as Comptroller for the State of
Alabama (hereinafter collectively referred to as "the State
defendants").3
of October 1, 2011, those eight Justices ex mero motu recused
themselves from this case on August 30, 2017, leaving William
B. Sellers as the sole remaining Associate Justice. On August
31, 2017, pursuant to § 12-2-5, Ala. Code 1975, Associate
Justice Sellers was appointed to serve as Acting Chief Justice
in this case and, pursuant to § 149, Ala. Const. 1901 (Off.
Recomp.), originally § 6.10 of Amendment No. 328, Ala. Const.
1901, appointed the following former Associate Justices to
serve with him as the special Supreme Court in this case: J.
Gorman Houston, Jr., Champ Lyons, Jr., Ralph D. Cook, Jean
Williams Brown, Terry L. Butts, and R. Bernard Harwood, Jr.
2During the pendency of this case, Strange resigned from
the office of Attorney General to accept an appointment to the
United States Senate. Pursuant to Rule 25(d), Ala. R. Civ.
P., his successor was automatically substituted as a party.
3In the style of his complaint, Judge Wood identified each
State official he has sued as a defendant in both his official
capacity and "individually." On appeal, he has not asserted
that they are liable to him in their individual capacities.
2
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I. Facts and Procedural History
This
appeal
involves
increases
in
the
rates
of
contributions judges and justices are required to pay into
the Judicial Retirement Fund ("the Fund"), pursuant to § 12-
18-5, Ala. Code 1975. The Fund was established under the
provisions of Act No. 1163, Ala. Acts 1973, codified at § 12-
18-1 et seq., Ala. Code 1975, to provide retirement benefits
to qualified judges and justices. The Fund is administered by
the Board of Control. See § 12-18-2(a), Ala. Code 1975.
Section 12-18-5 provides that membership in the Fund is
mandatory for judges and justices elected or appointed to
office after September 18, 1973. When the Fund was
established, each judge and justice participating in the Fund
was required to "contribute to [the Fund] four and one-half
percent of his earnable compensation." Id. In 1975, § 12-18-5
was amended to provide that, after February 1, 1977, "the rate
of contribution to be paid by the justices and judges shall be
six percent of their salary." Ala. Acts 1975, 4th Special
Sess., Act No. 66, § 4, p. 2680. On August 11, 1999, Judge
Wood was appointed to the 13th Judicial Circuit in Mobile, at
which time he began contributing six percent (6%) of his
3
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annual salary to the Fund. Judge Wood served until his
retirement on January 15, 2013.
On June 15, 2011, the legislature passed Act No. 2011-
676, Ala. Acts 2011 ("the Act"), which further amended § 12-
18-5 to provide for additional increases in contribution rates
to the Fund.4 Section 12-18-5, as amended, provides:
"For all pay dates beginning on or after October 1,
2011, the contribution to be paid by the justices
and judges shall be eight and one-quarter percent
(8.25%) of their salary. For all pay dates
beginning on or after October 1, 2012, the rate of
contribution to be paid by the justices and judges
shall be eight and one-half percent (8.5%) of their
salary."
Judge Wood was serving his second official term5 when both
increases in contribution rates took effect. Beginning
4The
Act,
in
addition
to
increasing contribution rates
for
justices and judges, also increased contribution rates for
participants in the Teachers' Retirement System of
Alabama and
the Employees' Retirement System of Alabama.
5The parties agree that, for purposes of determining
whether a judge's compensation has been diminished during his
or her official term in violation of the Judicial Compensation
Clause of Art. VI, § 148(d), Ala. Const. 1901, "official term"
means the term of office a judge serves after his or her
appointment or election until he or she is re-elected to a new
term (or resigns or retires prior thereto). We accept that
definition for the purpose of this appeal based upon the
aforementioned agreement of
the
parties. In Judge Wood's case,
the official term at issue spanned the period from January
2007 until January 2013.
4
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October 1, 2011, Judge Wood's contribution to the Fund
increased from six percent (6%) to eight and one-fourth
percent (8.25%), and, beginning October 1, 2012, his
contribution increased to eight and one-half percent (8.5%).
As noted, Judge Wood retired on January 15, 2013.
In June 2012, Judge Wood, individually, and on behalf of
a purported class of "all members" of the Fund, sued the State
defendants,
alleging that
the mandatory
increases
in
contributions to the Fund reduced Judge Wood's net pay without
affording him any additional retirement benefits. He alleged
that the increases in contributions violated the Judicial
Compensation Clause of Art. VI, § 148(d), Constitution of
Alabama of 1901 ("the Compensation Clause"), which provides
that "[t]he compensation of a judge shall not be diminished
during his official term."
In his complaint, Judge Wood sought a judgment declaring
the Act unconstitutional as violative of the Compensation
Clause. He requested relief in the form of an order restoring
to him any and all sums by which his compensation allegedly
had
been
diminished,
permanently
enjoining
the
State
defendants from continuing to enforce the Act against him, and
5
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awarding him costs and attorney fees. He also sought similar
relief under 42 U.S.C. § 1988. Finally, he sought to have a
class of similarly situated judges and justices certified.
The State defendants, pursuant to Rule 56, Ala. R. Civ.
P., filed a motion for a summary judgment, arguing that Judge
Wood's claims were due to be dismissed on the basis of
immunity and mootness.6 The State defendants also argued that
the increases in mandatory contributions did not diminish a
judge's or justice's compensation in violation of the
Compensation Clause. In response, Judge Wood moved the trial
court to enter a summary judgment declaring the Act
unconstitutional.
In May 2017, after considering the evidence and the
parties' arguments, the trial court entered a summary judgment
in favor of the State defendants and against Judge Wood,
upholding the Act. In its judgment, the trial court stated:
6The
State
defendants also
asserted
that
Judge
Wood
lacked
"standing" to bring claims against the Attorney General.
Section 6-6-227, Ala. Code 1975, requires only service of a
copy of the complaint on the Attorney General in an action
challenging the constitutionality of a state statute. It does
not appear that Judge Wood sought any relief from the Attorney
General; therefore, we pretermit consideration of the
issue of
standing.
6
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"Rather than diminishing 'compensation,' the
changes in retirement contribution rates implemented
by [the Act] simply increased the amount contributed
by all education and state employees, including
judges, to help pay for their retirement benefits.
Indeed, such changes have been made before–-in 1975
the legislature increased contribution rates for
participants including judges. See Acts 1975, 4th
Ex. Sess., No. 66, p. 2680, § 4. Moreover, it is
undisputed that judges retain ownership over their
own contributions and that they have the right to
withdraw their contributions from the retirement
system, with interest, should they choose to do so
at the end of their active employment. [Ala. Code
1975, § 12-18-8(b)]. The Compensation Clause is not
violated, nor is the independence of the judiciary
threatened, by [the Act's] broadly applicable
increase to retirement benefit costs. See United
States v. Hatter, [532 U.S. 557 (2001)](applying the
federal
Compensation
Clause
to
uphold
the
constitutionality of a Medicare cost increase that
applied to federal employees in general, including
judges)."7
Judge Wood appealed.
II. Discussion
Judge Wood argues that the trial court erred by entering
a
summary judgment in favor of the State defendants--upholding
the Act. The trial court entered the summary judgment based
on the merits of Wood's claims. However, this Court is
compelled to address at the outset the State defendants'
arguments concerning immunity and mootness because those
7The trial court did not rule on Judge Wood's request to
certify a class.
7
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arguments implicate subject-matter jurisdiction. See Ex parte
Smith, 438 So. 2d 766, 768 (Ala. 1983) ("[I]t is the duty of
an appellate court to consider lack of subject matter
jurisdiction ex mero motu."). Without subject-matter
jurisdiction, neither the trial court nor we can reach the
merits.
A. Immunity
In Alabama Department of Corrections v. Montgomery County
Commission, 11 So. 3d 189 (Ala. 2008), this Court stated the
following well established law regarding sovereign or State
immunity:
"Section 14, Ala. Const. 1901, provides: '[T]he
State of Alabama shall never be made a defendant in
any court of law or equity.' (Emphasis added.) 'The
wall of immunity erected by § 14 is nearly
impregnable.' Patterson v. Gladwin Corp., 835 So. 2d
137, 142 (Ala. 2002). Indeed, as regards the State
of Alabama and its agencies, the wall is absolutely
impregnable. Ex parte Alabama Dep't of Human Res.,
999 So. 2d 891, 895 (Ala. 2008) ('Section 14 affords
absolute immunity to both the State and State
agencies.'); Ex parte Jackson County Bd. of Educ.,
4 So. 3d 1099, 1102 (Ala. 2008) (same); Atkinson v.
State, 986 So. 2d 408, 410–11 (Ala. 2007) (same);
[In re] Good Hope [Contracting Co. v. Alabama Dep't
of Transp., 978 So. 2d 17 (Ala. 2007)] (same); Ex
parte Alabama Dep't of Transp., 764 So. 2d 1263,
1268 (Ala. 2000) (same); Mitchell v. Davis, 598 So.
2d 801, 806 (Ala. 1992) (same). 'Absolute immunity'
means just that--the State and its agencies are not
subject to suit under any theory.
8
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"'This immunity may not be waived.' Patterson,
835 So. 2d at 142. Sovereign immunity is, therefore,
not an affirmative defense, but a 'jurisdictional
bar.' Ex parte Alabama Dep't of Transp., 985 So. 2d
892, 894 (Ala. 2007). The jurisdictional bar of § 14
simply
'preclud[es]
a
court
from
exercising
subject-matter jurisdiction' over the State or a
State agency. Lyons v. River Road Constr., Inc., 858
So. 2d 257, 261 (Ala. 2003). Thus, a complaint filed
solely against the State or one of its agencies is
a nullity and is void ab initio. Ex parte Alabama
Dep't of Transp. (In re Russell Petroleum, Inc. v.
Alabama Dep't of Transp.), 6 So. 3d 1126 (Ala.
2008).... Any action taken by a court without
subject-matter jurisdiction--other than dismissing
the action--is void. State v. Property at 2018
Rainbow Drive, 740 So. 2d 1025, 1029 (Ala. 1999)."
11 So. 3d at 191-92.
"Because the immunity of the State is absolute,
this Court has usually provided that any exceptions
to that immunity extend only to suits naming the
proper State official in his or her representative
capacity. See Latham [v. Department of Corr.], 927
So. 2d [815,] 821 [(Ala. 2005)] (laying out the
exceptions to sovereign immunity). Even when an
action names the proper State official in his or her
representative capacity, such an action will be
barred if it is, in substance, an action against the
State for damages. See Ex parte Town of Lowndesboro,
950 So. 2d 1203, 1206 (Ala. 2006) ('Additionally, a
party may not indirectly sue the State by suing its
officers or agents "'when a result favorable to
plaintiff would be directly to affect the financial
status of the state treasury.'"' (quoting Patterson
v. Gladwin Corp., 835 So. 2d 137, 142 (Ala. 2002),
quoting in turn State Docks Comm'n v. Barnes, 225
Ala. 403, 405, 143 So. 581, 582 (1932)) (emphasis
added in Patterson))."
9
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Ex parte Alabama Dep't of Transp., 978 So. 2d 17, 22 (Ala.
2007).
The immunity afforded State officers sued in their
official capacities, however, is not unlimited:
"This Court has recognized six categories of
actions that survive the § 14 bar: (1) actions to
compel State officials to perform their legal
duties, Aland v. Graham, 287 Ala. 226, 229, 250 So.
2d 677, 679 (1971); (2) actions to enjoin State
officials from enforcing an unconstitutional law,
id.; (3) actions to compel State officials to
perform ministerial acts, 287 Ala. at 229–30, 250
So. 2d at 678–79; (4) actions under the Declaratory
Judgment Act, § 6–6–220 et seq., Ala. Code 1975,
seeking construction of a statute and how it applies
in a given situation, 287 Ala. at 230, 250 So. 2d at
679; (5) valid inverse-condemnation actions brought
against State officials in their representative
capacities, Drummond Co. v. Alabama Dep't of
Transp., 937 So. 2d 56, 58 (Ala. 2006); and (6)
actions to enjoin State officials from acting
fraudulently, in bad faith, beyond their authority,
or in a mistaken interpretation of law, Ex parte
Moulton, 116 So. 3d 1119, 1141 (Ala. 2013). This
Court has also noted that '"an action is one against
the [S]tate when a favorable result for the
plaintiff would directly affect a contract or
property right of the State, or would result in the
plaintiff's recovery of money from the [S]tate."'
Alabama Agric. & Mech. Univ. v. Jones, 895 So. 2d
867, 873 (Ala. 2004) (quoting Shoals Cmty. College
v. Colagross, 674 So. 2d 1311, 1314 (Ala. Civ. App.
1995))."
Ex parte Retirement Sys. of Alabama, 182 So. 3d 527, 533-34
(Ala. 2015) (footnote omitted).
10
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Based on the above principles, the State of Alabama is
absolutely immune from Judge Wood's suit under § 14. Judge
Wood has also sued the Board of Control on the basis that it
manages the Fund. The State defendants argue that the Board of
Control is also immune under § 14 because, they say, the Board
is an instrumentality of the State and is therefore immune
from suit to the same extent as the State. Judge Wood
presents no argument to the contrary. See Bronner v. State,
171 So. 3d 614, 619 (Ala. 2014)("See Art. I, § 14, Ala. Const.
1901;
Ala.
Code
1975,
§§
16–25–2(b)
and
36–27–2(b)
(recognizing that the boards of control of the [Teachers'
Retirement System] and the [Employees' Retirement System] are
instrumentalities of
the
State,
that
the
[Teachers'
Retirement
System] and the [Employees' Retirement System] are funded by
the State, and that their officers and employees are immune
from suit in their official capacities to the same extent as
the State, its agencies, and its officers and employees).").
"[T]he immunity afforded the State by § 14 applies to
instrumentalities of the State and State officers sued in
their official capacities when such an action is effectively
an action against the State." Vandenberg v. Aramark Educ.
11
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Servs., Inc., 81 So. 3d 326, 332 (Ala. 2011). "[A]ny
exceptions to [this] immunity extend only to suits naming the
proper State official in his or her representative capacity."
Ex parte Department of Transp., 978 So. 2d at 22. In this
case, Judge Wood has sued only the Board of Control, not any
of its members in their official capacities. Accordingly, the
Board of Control is also entitled to § 14 immunity.
Judge Wood has also sued Bronner in his capacity as chief
executive officer of the Employees' Retirement System and
White in his capacity as State comptroller. The State
defendants argue that Judge Wood's claim for money damages
against Bronner and White in their official capacities is also
barred by § 14 immunity because, they say, any recovery on
that claim would affect the financial status of the State
treasury. As indicated, Judge Wood seeks restitution from
Bronner and White in the form of "any and all sums by which
[his and the purported class members'] compensation has been
...
diminished during
their
official
terms
through
enforcement
of
[the
allegedly
unconstitutional Act]."
The
State
defendants
rely upon Ex parte Retirement Systems of Alabama, supra, a
case decided after the commencement of this action, to support
12
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their
argument
that
this
Court
lacks
subject-matter
jurisdiction to award money damages in the form of a refund,
apparently even when those damages are the result of the
implementation of an allegedly unconstitutional act resulting
in the alleged diminution of a judge or justice's compensation
during the judge or justice's official term in office. In
Retirement
Systems,
the
plaintiffs, public
educators
and
their
spouses, sued various State officials seeking to recover
restitution for funds paid for coverage pursuant to an
allegedly invalid insurance policy that had been implemented
by the officials. The plaintiffs alleged that the policy
violated various provisions of the Alabama Constitution of
1901, the United States Constitution, and 42 U.S.C. § 1983.
As in this case, the State officials moved the circuit court
to dismiss the complaint, arguing, among other things, that
the claims against them were barred by § 14 immunity.
The Court in Retirement Systems noted that "'an action is
one against the [S]tate when a result favorable for the
plaintiff would ... result in the plaintiff's recovery of
money from the [S]tate.'" 182 So. 3d at 536 (quoting Alabama
Agric. & Mech. Univ. v. Jones, 895 So. 2d 867, 873 (Ala.
13
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2004)). The plaintiffs, citing Alabama Department of
Transportation v. Harbert International, Inc., 990 So. 2d 831
(Ala. 2008) ("Harbert"), argued that their request for
restitution in the form of incidental monetary relief was not
barred by the doctrine of sovereign immunity because, they
said, a court may order State officers to pay the
predetermined amount as a ministerial duty. The plaintiffs
argued that, because the funds did not belong to the State,
the State treasury would suffer no more than it would have
suffered had the State officials originally performed their
ministerial duties and paid the debts. This Court concluded
that the plaintiffs' reliance on Harbert was misplaced:
"In Harbert, this Court addressed, among other
things,
whether
Harbert
International,
Inc.
('Harbert'), could maintain an action against the
Alabama Department of Transportation ('ALDOT'),
seeking, among other things, (1) the return of
liquidated damages withheld under an allegedly
unlawful provision of Harbert's contract with ALDOT,
(2) $291,750 of a retainage ALDOT owed under the
contract, and (3) compensation for extra work
Harbert had performed under the contract. This Court
noted that 'mandamus relief is available in certain
situations to compel a State officer to perform the
ministerial act of tendering payment of liquidated
or certain sums the State is legally obligated to
pay under a contract.' Harbert, 990 So. 2d at 842.
We went on to affirm the circuit court's judgment
insofar as it required ALDOT to pay Harbert the
liquidated damages and retainage owed under the
14
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contract but reversed the judgment insofar as it
directed the payment to Harbert of unliquidated
damages for its breach-of-contract claim.
"Although the public-education plaintiffs argue
that the restitution they are requesting is not
'compensatory or unliquidated damages' and is 'an
amount
known
to
[the
PEEHIP
defendants],'
public-education plaintiffs' brief, at 14, the
restitution requested in this case is more in the
nature of a refund of amounts overpaid than a
request for liquidated or certain damages owed under
contract. This Court has determined that such claims
are barred by § 14."
182 So. 3d at 536. Accordingly, in Retirement Systems, this
Court held that the plaintiffs' claims for restitution in the
form of a refund of amounts overpaid, as well as for costs and
attorney fees, were barred by the doctrine of sovereign
immunity insofar as the claims would impact the State
treasury. 182 So. 2d at 137. The Court further held that the
plaintiffs' claims for monetary relief based on federal law
were also barred by the Eleventh Amendment to the United
States Constitution. See Pennhurst State Sch. & Hosp. v.
Halderman, 465 U.S. 89, 101 (1984)("The Eleventh Amendment
bars a suit against state officials when 'the state is the
real, substantial party in
interest.'" (quoting Ford Motor Co.
v. Department of Treasury, 323 U.S. 459, 464 (1945))).
15
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We note that Judge Wood, for the first time in his reply
brief, generally asserts that the first, second, third,
fourth, and sixth categories of exceptions as set forth in
many of our cases, including Retirement Systems, prevent the
State defendants from claiming immunity under § 14. Judge Wood
offers this Court no response to the State defendants'
reliance
on
Retirement
Systems,
including
the
State
defendants' contention that, under principles discussed in
Retirement Systems, Judge Wood's claim for monetary damages
implicates a refund and therefore is barred by § 14 immunity.
Nor does Judge Wood request this Court to reconsider,
distinguish, or overrule Retirement Systems. Judge Wood also
has not offered any response to the State defendants'
assertion of immunity for claims arising under 42 U.S.C. §
1988.
In Blevins v. Hillwood Office Center Owners' Ass'n, 51
So. 3d 317, 322 (Ala. 2010) this Court observed:
"This Court has often said that it is '"'duty
bound to notice ex mero motu the absence of
subject-matter jurisdiction.'"' Riley v. Hughes, 17
So. 3d 643, 648 (Ala. 2009) (emphasis added)
(quoting Baldwin County v. Bay Minette, 854 So. 2d
42, 45 (Ala. 2003), quoting in turn Stamps v.
Jefferson County Bd. of Educ., 642 So. 2d 941, 945
n. 2 (Ala. 1994)). However, just because the Court
16
1160814
is
duty
bound
to
notice
the
absence
of
subject-matter jurisdiction, it does not follow that
it is so bound to construct theories and search the
record for facts to support the existence of
jurisdiction for plaintiffs who choose to stand mute
in the face of a serious jurisdictional challenge."
Based on the facts and arguments presented in this appeal,
this Court concludes that Judge Wood has failed to sustain his
burden of establishing subject-matter jurisdiction to award
money damages upon alleged violations of the Compensation
Clause of the Alabama Constitution or 42 U.S.C. § 1988
stemming from legislatively mandated increases in a judge's or
justice's contributions to the Fund. Accordingly, State
defendants Bronner and White are entitled to dismissal of all
claims against them in their official capacities for money
damages.
B. Mootness
Judge Wood also sought prospective injunctive relief in
the form of an order permanently restraining the State
defendants
from
continuing
to
enforce
the
allegedly
unconstitutional Act against him. We agree with the State
defendants, however, that Judge Wood's claim for prospective
injunctive relief has become moot by virtue of his retirement
from judicial office.
17
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"When an action becomes moot during its
pendency,
the
court
lacks
power
to
further
adjudicate the matter.
"'"The test for mootness is commonly stated
as whether the court's action on the merits
would affect the rights of the parties."
Crawford v. State, 153 S.W.3d 497, 501
(Tex. App. 2004) (citing VE Corp. v. Ernst
& Young, 860 S.W.2d 83, 84 (Tex. 1993)). "A
case becomes moot if at any stage there
ceases to be an actual controversy between
the parties." Id. (emphasis added) (citing
National Collegiate Athletic Ass'n v.
Jones, 1 S.W. 3d 83, 86 (Tex. 1999)).'
"Chapman v. Gooden, 974 So. 2d 972, 983 (Ala. 2007)
(first emphasis added). See also Steffel v.
Thompson, 415 U.S. 452, 459 n. 10, 94 S. Ct. 1209,
39 L.Ed. 2d 505 (1974) ('[A]n actual controversy
must be extant at all stages of review, not merely
at the time the complaint is filed.')."
South Alabama Gas Dist. v. Knight, 138 So. 3d 971, 974–76
(Ala. 2013).
Judge Wood was serving his second official term as a
circuit judge when the Act was passed and when both increases
in contribution rates took effect. Judge Wood retired on
January 15, 2013, ending his official term in office and
precluding the possibility that the Act would impact his
compensation in the future. As indicated, the Compensation
Clause prohibits the diminishment of a judge's compensation
only "during [the judge's] official term." When Judge Wood's
18
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official term ended upon his retirement, he ceased making
contributions to the Fund; after that point, there was no
longer
any
actual
controversy
between
the
parties
necessitating an order prohibiting future application of the
(allegedly unconstitutional) Act.8
III. Conclusion
An order entered without subject-matter jurisdiction is
void. McDaniel v. Ezell, 177 So. 2d 454 (Ala. 2015) Because
Judge Wood's claim for money damages is not shown to be within
this Court's subject-matter jurisdiction and his claim for
prospective injunctive relief
is
moot,
also
defeating subject-
matter jurisdiction, we cannot address the constitutionality
of the Act. Accordingly, this Court holds that the trial
court's judgment upholding the Act against Judge Wood's
constitutional challenge is void. We dismiss the appeal,
vacate the summary judgment in favor of the State defendants,
8We also note that the State defendants argue that any
claim for prospective injunctive relief Judge Wood asserted on
behalf of the purported class members is moot for a different
reason. Specifically, the State defendants assert, and Judge
Wood does not contest, that the judges and justices that would
be members of the purported class have started new terms since
the increases in contribution rates took effect. We agree.
Those judges and justices will not have their contribution
rates increased, pursuant to the Act, during their current
official terms.
19
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and
dismiss the action for failure to establish subject-matter
jurisdiction as to the claim for monetary damages and on the
basis of mootness as to the claim for prospective injunctive
relief.
APPEAL DISMISSED; JUDGMENT VACATED; CASE DISMISSED.
J. Gorman Houston, Jr., Champ Lyons, Jr., Jean Williams
Brown, Terry L. Butts, and R. Bernard Harwood, Jr., Special
Justices, concur.
Ralph D. Cook, Special Justice, concurs in the result.
20
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COOK, Special Justice (concurring in the result).
I
disagree
with
the
main
opinion's
conclusions
regarding the
applicability of the immunity provisions of Art.
I, § 14, Const. of Alabama 1901, to all defendants and claims
in this case. However, under the facts of this case, I
believe
this
nondiscriminatory
increase
in
retirement
contributions, which
also
constituted a
reduction
in
take-home
pay, was an indirect decrease in compensation that does not
violate the Compensation Clause contained in the Alabama
Constitution. Therefore, I concur in the result.
21 | November 21, 2017 |
211663b8-957e-4a1b-ad5e-528bbbc2c22b | Ex Parte Borden | 769 So. 2d 950 | 1972037 | Alabama | Alabama Supreme Court | 769 So. 2d 950 (2000)
Ex parte James Henry BORDEN, Jr.
(Re James Henry Borden, Jr. v. State).
1972037.
Supreme Court of Alabama.
February 4, 2000.
Rehearing Denied April 21, 2000.
*952 Bryan A. Stevenson and Ellen L. Wiesner of Equal Justice Initiative of Alabama, Montgomery, for petitioner.
Bill Pryor, atty. gen.; and Michael B. Billingsley and A. Vernon Barnett IV, asst. attys. gen., for respondent.
ENGLAND, Justice.[1]
James Henry Borden, Jr., was convicted of murder made capital because he had been convicted of another murder within the 20 years preceding this offense, see § 13A-5-40(a)(13), Ala.Code 1975. The jury, by a vote of 10-2, recommended that he be sentenced to death. The trial court accepted this recommendation and sentenced Borden to death by electrocution. On appeal, the Court of Criminal Appeals held that the trial court's written sentencing order was deficient in that it failed to comply with the requirement of § 13A-5-47(d), Ala.Code 1975, that the trial court enter specific written findings concerning the existence or non-existence of each aggravating circumstance enumerated in § 13A-5-51, and any additional mitigating circumstances offered pursuant to § 13A-5-52. Borden v. State, 769 So. 2d 935 (Ala. Crim.App.1997). Accordingly, the Court of Criminal Appeals remanded the cause for the trial court to enter specific written findings concerning the existence or nonexistence of each aggravating circumstance enumerated in § 13A-5-49, each mitigating *953 circumstance enumerated in § 13A-5-51, and any additional non-statutory mitigating circumstances offered pursuant to § 13A-5-52.
On the circuit court's return to that remand order, the Court of Criminal Appeals, on May 29, 1998, wrote another opinion, stating that the amended sentencing order indicated that the trial court had found the existence of two statutory aggravating circumstances: (1) that Borden, in September 1975, had been convicted of a felony involving the use of violence to the person (specifically, second-degree murder) see § 13A-5-49(2); and (2) that the capital offense was committed while Borden was engaged in an attempt to commit a kidnapping and a rape, see § 13A-5-49(4). The amended order further indicated that the trial court, after making specific written findings as to each circumstance, found that none of the statutory mitigating circumstances enumerated in § 13A-5-51 had been proven to exist. The Court of Criminal Appeals affirmed Borden's conviction and his sentence of death. See opinion on return to remand, 769 So. 2d at 945.
The facts of this case are stated in the original opinion of the Court of Criminal Appeals as follows:
769 So. 2d at 937-38. (Citations omitted.)
Borden first argues that his conviction and death sentence are void, because, he says, the trial judge failed to swear in the petit jury which ultimately convicted him of capital murder. The administration of the oath to the petit jury is required by § 12-16-170, Ala.Code 1975, as well as by Rule 18.5, Ala. R.Crim. P. Foshee v. State, 672 So. 2d 1387 (Ala.Crim. App.1995).
On November 28, 1994, at the Lawrence County Courthouse in Moulton, the trial judge welcomed the initial panel of prospective jurors; it then had them stand and state their names, addresses, and occupation. The trial judge administered the oath to the prospective jurors as follows:
(C.R. 112-13).
After questioning and excusing some members of the venire for cause, the trial judge asked those remaining to stand and take their oath as a juror for the week. The trial judge swore them in as follows:
(C.R. 152.)
While the voir dire examination of the prospective jurors was in progress, the trial judge had his staff call in other persons for jury service. On November 29, 1994, the trial judge organized a second venire and administered the oath to them:
(C.R. 406.) After voir dire examination by attorneys for the State and for the defense, the trial judge stated:
(C.R. 434.)
Borden's jury was made up of persons from both venires. A check of the names of the members of the jury against those who were sworn on the two venires, shows *955 that each member was sworn, according to the oath set forth in § 12-16-170, Ala. Code 1975. They were not sworn a second time, and they were not reminded of their earlier oath.
This Court stated in Ex parte Deramus, 721 So. 2d 242 (Ala.1998):
Here, the record does not reflect that Borden's counsel objected during the course of the trial. The absence of an objection does not preclude this Court from reviewing Borden's claim, however, because Borden has been sentenced to death. "In all cases in which the death penalty has been imposed," Rule 39(k), Ala. R.App. P., requires that this Court "notice any plain error or defect in the proceeding under review, whether or not brought to the attention of the trial court, and take appropriate appellate action by reason thereof, whenever such error has or probably has adversely affected the substantial rights of the petitioner." See Ex parte Myers, 699 So. 2d 1285, 1290 (Ala.1997). The absence of an objection in a case involving the death penalty does not preclude this Court's review of the issue; however, the defendant's failure to object does weigh against his claim of prejudice. Ex parte Woodall, 730 So. 2d 652 (Ala.1998).
We must reject Borden's claim that the petit jury that convicted him of capital murder was not sworn. The record plainly reflects that each member of the two jury venires had been sworn once. The record does not indicate that the trial court administered a separate oath to the petit jury that was selected and empaneled to hear Borden's case or that it reminded Borden's jurors that they were still under oath, as it is required to do by Ala.Code 1975, § 12-16-170, and Rule 18.5, Ala. R.Crim. P. Nevertheless, as this Court held in Deramus, the trial court's failure to administer a second oath or to remind the jurors of their previous oath was harmless error.
Borden argues in his brief that the holding in Deramus does not apply in his case because Deramus was not a death-penalty case. While Borden's case is a death-penalty case and Deramus was not, that distinction is not determinative. As the State points out in its brief, § 12-16-173 states: "No criminal case taken by appeal to the Court of Criminal Appeals shall be reversed because of any defect in the administration of the oath to any grand or petit jury, unless the record in the case discloses the fact that some objection was taken in the court below during the progress of the trial, based on such defect." (Emphasis added.) The State argues, "The statute makes no exception for death-penalty cases." In light of this Court's holding in Deramus, and what we consider to be plain language in § 12-16-173, we conclude that a defect in the administration of the oath cannot rise to the level of "plain error," as that term is defined by law. We must reject Borden's argument that his conviction must be reversed because of a defect in the administration of the jurors' oath.
Borden contends that he is entitled to a reversal of his conviction, on the basis that the trial court failed to hold a competency hearing. He made no issue at trial or on direct appeal regarding a failure to hold a competency hearing. On this certiorari review, however, he argues that at trial he presented evidence that should have raised a "bona fide doubt" (see Pate v. Robinson, 383 U.S. 375, 385, 86 S. Ct. 836, 15 L. Ed. 2d 815 (1966)), or a "reasonable ground for a doubt" (see Barfield v. State, 54 Ala.App. 15, 21, 304 So. 2d 257, 262 (Ala.Crim.App.1974)), as to his ability to communicate with counsel and to understand *956 the nature of the charge against him. Borden contends that the trial judge erred by not ordering a hearing on the question of his competency to stand trial and that the court's failure to order such a hearing violated his due-process rights as guaranteed by the United States Constitution; his rights guaranteed by the Sixth and Eight Amendments to the United States Constitution; and his right to a fair trial as guaranteed by the provisions of Article I of the Alabama Constitution of 1901.
Alabama law is clear and well defined with regard to competency hearings. Section 15-16-21, Ala.Code 1975, states:
Section 15-16-21 "authorizes the trial court to make a preliminary determination (without the aid of a jury) as to whether there are reasonable grounds to doubt the defendant's competency to stand trial." Reese v. State, 549 So. 2d 148, 150 (Ala. Crim.App.1989).[2] "[T]he trial court is [, thus,] the screening agent" as to a request for a mental examination. Livingston v. State, 419 So. 2d 270, 274 (Ala.Crim.App. 1982).
The trial judge heard expert testimony from Dr. Lawrence R. Maier, a clinical psychologist who had made an evaluation of Borden's mental competency. On cross-examination, Dr. Maier testified as follows:
Dr. Maier's testimony provided the trial judge adequate assurances as to Borden's competency. Based on the expert's testimony, the judge could have concluded that there was no "reasonable or bona fide doubt as to [Borden's] sanity" and, thus, that no further examination was required. See Waldrop v. State, 459 So. 2d 953, 955 (Ala.Crim.App.1983), aff'd, 459 So. 2d 959 (Ala.1984), cert. denied, 471 U.S. 1030, 105 S. Ct. 2050, 85 L. Ed. 2d 323 (1985).
We must reject Borden's argument regarding the trial judge's failure to hold a competency hearing.
Borden argues that he is mentally retarded and that the trial court's failure to find mental retardation as a mitigating circumstance entitles him to a reversal of the death sentence. The State counters this argument by pointing out that in his sentencing order the trial judge did consider Borden's mental-health problems but ultimately rejected them as a mitigating factor.
In his amended sentencing order, the trial judge stated:
On the question of a proper sentence in a capital case, the trial court must permit a defendant to submit any evidence the defendant feels might be taken in mitigation during his sentencing. Lockett v. Ohio, 438 U.S. 586, 604, 98 S. Ct. 2954, 57 L. Ed. 2d 973 (1978); Ex parte Land, 678 So. 2d 224, 241 (Ala.1996); Ex parte Hart, 612 So. 2d 536, 541-42 (Ala.1992), cert. denied, 508 U.S. 953, 113 S. Ct. 2450, 124 L. Ed. 2d 666 (1993). Borden submitted the evidence regarding his mental condition, and the sentencing order indicates that the *958 judge considered that evidence. There is no requirement that a sentencing authority must find the evidence offered by the defendant as a mitigating factor; however, the sentencing authority may not be precluded from considering any mitigating factor. Eddings v. Oklahoma, 455 U.S. 104, 102 S. Ct. 869, 71 L. Ed. 2d 1 (1982); Rutledge v. State, 523 So. 2d 1087, 1103-04 (Ala.Crim.App.1987), rev'd on other grounds, 523 So. 2d 1118 (Ala.1988). Clisby v. State, 456 So. 2d 99 (Ala.Crim.App. 1983), aff'd, 456 So. 2d 105 (Ala.1984), cert. denied, 470 U.S. 1009, 105 S. Ct. 1372, 84 L. Ed. 2d 391 (1985).
The record indicates that the trial judge considered every aspect of the evidence regarding Borden's mental health, and concluded that that evidence did not support the finding of a mitigating circumstance. Thus, we must reject Borden's argument.
Borden contends that one of his attorneys at trial had a conflict of interest, specifically, that the attorney, while involved in this case as defense attorney, had a continuing relationship with the Morgan County district attorney's office, as a special prosecutor. Borden contends that the attorney, through his work as a special prosecutor in Morgan County, had a relationship with state law-enforcement agencies, because, Borden argues, the attorney depended on their investigative skills in order to prosecute his own Morgan County criminal cases. Borden argues that his attorney's double judicial roleas a defense attorney in Lawrence County and a special prosecutor in Morgan Countycreates a conflict of interest. This conflict, Borden argues, requires that he be given a new trial.
Molton v. State, 651 So. 2d 663, 668 (Ala. Crim.App.), on return to remand, 651 So. 2d 672 (Ala.Crim.App.1994).
The State argues that, to entitle a defendant such a Borden to a reversal of Borden's conviction, the conflict of interest alleged must be a true conflict, not a speculative or hypothetical one. "`In order to demonstrate a violation of his Sixth Amendment rights, a defendant must show that an actual conflict of interest adversely affected his lawyer's performance.' Cuyler v. Sullivan, 446 U.S. 335, 350, 100 S. Ct. 1708, 1719, 64 L. Ed. 2d 333 (1980)." Dallas v. State, 711 So. 2d 1101, 1111 (Ala. Crim.App.1997), aff'd, 711 So. 2d 1114 (Ala. 1998). The State argues that the simple fact that Borden alleges a conflict of interest does not mean that a conflict of interest truly existed. The State argues that this claim, even when considered under the standard imposed by the "plain-error" doctrine (see Rule 39(k), Ala. R.App. P.), does *959 not entitle Borden to a reversal. We agree with the State's argument.
Borden argues that his arrest was illegal because, he says, the arrest warrant was not properly "domesticated" by a judge or magistrate of the county where he was arrested, as is required by § 15-10-10, Ala.Code 1975. Borden was arrested in Morgan County on an arrest warrant issued by the Lawrence County District Court. The Lawrence County felony warrant had not been endorsed by a judge or magistrate of Morgan County. Borden further argues that certain evidence, specifically blood obtained from the clothing he was wearing at the time of his arrest, was the product of an illegal arrest and, therefore, was not properly admitted as evidence.
We hold that a law enforcement officer may not obtain an arrest warrant in one county and execute it in another county without also obtaining, before executing the warrant, its endorsement by a judge or magistrate of the county where the arrest is to take place. This procedure is required by § 15-10-10, Ala.Code 1975. We have had prior cases holding to the contrary, but these cases were based on a mistakenly expansive reading of Rule 3.3(a), Ala. R.Crim. P. See Taylor v. State, 666 So. 2d 36 (Ala.Crim.App.), aff'd on return to remand, 666 So. 2d 71 (Ala.Crim. App.1994), cert. denied, 666 So. 2d 73 (Ala. 1995); Smith v. State, 727 So. 2d 147 (Ala. Crim.App.1998); aff'd, 727 So. 2d 173 (Ala. 1999); Beard v. State, 661 So. 2d 789 (Ala. Crim.App.1995).
That rule reads, in its entirety:
The phrase "within the State of Alabama" merely completes the description of the category of persons who may obtain and execute arrest warrants, to include all law enforcement officers within that category. The Committee Comment to Rule 3.3 so indicates:
We conclude that the phrase "within the State of Alabama" does not address the question where arrest warrants may be executed, but only the question who may obtain and execute them. The statutory restrictions on where arrest warrants, once issued, may be executed remain binding, to protect the public from impostors and to prevent the unexplained disappearance of people from the county.
Section 15-10-10, which the officers violated in this case, is a public safety statute. It allows a judge or magistrate in a particular county to pass on the validity of an arrest warrant issued elsewhere and to pass on the identity and authority of the person who proposes to execute the warrant before that person may take someone there into custody and away from the county. Nothing in this statute conflicts with Rule 3.3(a), Ala. R.Crim. P., so as to imply that Rule 3.3(a) supersedes or preempts the statute.
Because the warrant in the case before us was not domesticated, as required by § 15-10-10, it did not support the arrest of Borden or the seizure of the clothing he was then wearing. Thus, the Court of Criminal Appeals erred in holding that § 15-10-10 did not require that the Lawrence County warrant be endorsed by a judge or a magistrate of Morgan County before the warrant could be executed in Morgan County.
The Court of Criminal Appeals stated in an alternative holding, however, that exigent *960 circumstances justified Borden's arrest by the local officerswho did, in fact, participate in the arresteven without a warrant. We agree, and we also agree with the Court of Criminal Appeals that the arrest justified the seizure of the clothes, which could thus be used as evidence against Borden.
Finally, we consider whether certain comments made by the prosecutor during closing argument violated Borden's right to a fair trial. Borden argues that the prosecutor improperly commented that Borden "is mildly mentally retarded so he has a license to kill." We quote here the prosecutor's comment that Borden complains of:
Borden did not object to this comment at trial. If it was error, it clearly was not "plain error." See Rule 39(k), Ala. R.App. P.
We have thoroughly reviewed the record, acting pursuant to Rule 39(k), Ala. R.App. P., and we have found no "plain error" that would warrant a reversal of the conviction. The Court of Criminal Appeals addressed three issues raised by Borden: (1) whether the trial court erred in denying his motion to suppress physical evidence obtained following his arrest; (2) whether his constitutional rights were violated by his absence from a pretrial hearing held on November 17, 1994; and (3) whether the trial court's finding, as a statutory aggravating circumstance, that Borden, when he committed the murder, was attempting to kidnap "or possibly rape" the victim, constitutes evidence indicating that the State failed to prove the existence of that statutory aggravating circumstance "beyond a reasonable doubt," as required by § 13A-5-45(e), Ala.Code 1975.
The Court of Criminal Appeals, finding no reversible error, affirmed Borden's conviction and sentence. We affirm the judgment of the Court of Criminal Appeals.
AFFIRMED.
HOOPER, C.J., and HOUSTON, SEE, LYONS, and JOHNSTONE, JJ., concur.
MADDOX, J., concurs in Parts I, II, III, IV, VI, and VII, and concurs in the result in Part V.
BROWN, J., recuses herself.[*]
[1] Justice England was not a member of this Court when this case was orally argued, but he has listened to the audiotape of oral argument.
[2] In its brief, the State cites the phrase "without the aid of a jury" as coming from Ex parte LaFlore, 445. So.2d 932 (Ala.1983). This phrase is also quoted by Russell v. State, 715 So. 2d 866, 868 (Ala.Crim.App.1997). However, these cases have perpetuated an error in this regard. The "without the aid of a jury" phrase did not appear in Ex parte LaFlore. It appears that the phrase originated with Richardson v. State, 354 So. 2d 1193, 1196 (Ala. Crim.App.1978), although that phrase is not directly contained in Richardson either. Nevertheless, the phrase "without the aid of a jury" has been heavily relied on, despite the fact that the legal proposition based on it originated through less than precise research and writing, it has been perpetuated and solidified by post-LaFlore opinions.
[*] Justice Brown was a member of the Court of Criminal Appeals when that court considered this case. | February 4, 2000 |
942d5fe4-9602-4d2c-9626-72aeb7de3a07 | Travelers Indemnity Company of Connecticut v. Worthington | N/A | 1150370 | Alabama | Alabama Supreme Court | Rel: October 13, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334)
229-0649), of any typographical or other errors, in order that corrections may be made
before the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
_________________________
1150370
_________________________
Travelers Indemnity Company of Connecticut
v.
Angela Worthington
Appeal from Limestone Circuit Court
(CV-12-900356)
WISE, Justice.
The defendant below, Travelers Indemnity Company of
Connecticut ("Travelers"), appeals from Limestone Circuit
Court's denial of its postjudgment motion seeking to set aside
1150370
a judgment entered on a jury verdict in favor of the plaintiff
below, Angela Worthington. We affirm.
Facts and Procedural History
On April 27, 2011, Worthington was a passenger in a
vehicle being driven by her husband. A friend of the
Worthingtons and the Worthingtons' two minor children were
also passengers in the vehicle. While the Worthingtons'
vehicle was stopped at a nonfunctioning traffic light, it was
struck in the rear by a vehicle being operated by Camille
Thomas. Worthington and the other occupants in her vehicle
were injured as a result of the accident.
At the time of the accident, the company Worthington's
husband owned had a comprehensive insurance policy with
Travelers
that
included
uninsured-motorist
("UM")
and
underinsured-motorist
("UIM")
coverage.
The
policy
endorsement dealing with UM/UIM coverage provided, in
pertinent part:
"C. Exclusions
"This insurance does not apply to:
"1.
Any claim settled without
our consent.
2
1150370
"However,
this
exclusion
does
not
apply
to
a
settlement made with the
insurer
of
a
vehicle
described in Paragraph b. of
the definition of 'uninsured
motor vehicle.'
"....
"E. Changes in Conditions
"These conditions are changed for
Uninsured Motorists Coverage as follows:
"....
"2. Duties in the Event of
Accident, Claim Suit or Loss is
changed by adding the following:
"....
"c.
A person seeking
Uninsured
Motorists
Coverage must also
promptly notify us
in writing of a
t e n t a t i v e
settlement between
the 'insured' and
the insurer of a
vehicle
described
in Paragraph b. of
the definition of
an
'uninsured motor
vehicle' and allow
us
30
days
to
advance payment to
that insured in an
amount equal to the
t e n t a t i v e
3
1150370
settlement
to
preserve
our
rights
a g a i n s t
t h e
insurer, owner, or
operator of such a
vehicle
described
in Paragraph b. of
the definition of
'uninsured
motor
vehicle.'
"....
"F. Additional Definitions
"As used in this endorsement:
"....
"3.
'Uninsured
motor
vehicle'
means a land motor vehicle
or 'trailer':
"....
"b.
That
is
an
underinsured motor
vehicle.
An
underinsured motor
vehicle is a land
motor vehicle or
'trailer' for
which
the
sum
of
all
liability bonds or
policies
at
the
t i m e
o f
a n
'accident'
provides
a limit that is
less
than
the
amount
an
'insured'
is
legally entitled
to
recover
as
4
1150370
damages caused by
the 'accident.'"
(Boldface type in original.)
On
December
7,
2012, Worthington's husband, individually,
and Worthington, individually and as mother and next friend of
the two minor children, filed a complaint in the Limestone
Circuit Court against Thomas and Travelers.1 The complaint
included claims of negligence, wantonness, and negligence per
se against Thomas. Worthington and her husband also included
claims of loss of consortium. Finally, the complaint included
a UM/UIM claim against Travelers.
On January 18, 2013, Travelers filed its answer to the
complaint. In its answer, Travelers set forth affirmative
defenses, but it did not set forth any policy-based defenses.
On October 28, 2014, Worthington's counsel notified
Travelers' counsel that Worthington and Thomas had reached a
proposed agreement to resolve Worthington's claims against
Thomas for $56,250, plus mediation costs and filing fees.
Travelers advised Worthington of its intent to maintain its
1During a hearing on August 11, 2015, the parties
stipulated that the claims of Worthington's husband and minor
children were dismissed with prejudice, leaving as a plaintiff
only Worthington in her individual capacity.
5
1150370
rights under Lambert v. State Farm Mutual Automobile Insurance
Co., 576 So. 2d 160 (Ala. 1991), and advanced the amount of
the proposed settlement to Worthington; Thomas was not
released, and the action therefore proceeded with her
remaining as a defendant.
On July 29, 2015, Worthington filed a motion for a
partial summary judgment as to her negligence claim against
Thomas.
Subsequently, counsel for Worthington sent a letter to
counsel for Thomas that was dated August 7, 2015, that stated:
"This letter will confirm that my client has
authorized me to reject your offer to settle this
case for $85,000. Please advise your insured Mrs.
Thomas that in the event there is a verdict in
excess of $100,000, we intend to execute on some of
her assets even though there is a substantial
underinsured motorist policy available. Your
client, the insured, should be advised that we have
offered to resolve this case against her for the
policy limits of $100,000. I strongly encourage you
to alert Mrs. Thomas to that fact so she might seek
independent counsel in her dealings with Allstate.
In the event of a verdict in excess of $100,000 it
is the Plaintiff's right and option to satisfy that
judgment in whatever ways we deem lawful and
appropriate. That would include executing on any
bank accounts, personal property or other assets
owned by the insured. Of course that will not be
necessary if Allstate will simply tender the policy
limits.
6
1150370
"This letter is being written so there is no
misunderstanding
or
future
controversy
over
Allstate's action in this case. While I do not
enjoy executing upon the assets of an individual, I
believe that Allstate has not acted in good faith in
working to resolve this claim. As a result, the
personal property and assets of its insured are
being exposed to the possibility of a substantial
verdict, and I believe Allstate should be liable for
any excess verdict.
"My client's offer to accept Allstate's policy
limits while preserving its underinsured motorist
claim shall expire August 10th, 2015 at 4:00 p.m.
central standard time. Should you have any
questions or need assistance please do not hesitate
to call."
On August 10, 2015, counsel for Thomas contacted counsel
for Travelers and informed him that Worthington had entered
into a settlement agreement with Thomas's insurer, Allstate.
The agreement provided that Worthington would accept $95,000
in exchange for Worthington's agreement to dismiss Thomas from
the lawsuit with prejudice. At 11:13 a.m. on August 10, 2015,
counsel for Worthington filed a letter informing the trial
court that Worthington and Thomas had reached a pro tanto
settlement and that the case would proceed as a UIM claim
against Travelers. The letter also addressed scheduling
issues that had arisen due to the death of the mother of one
of the witnesses. In addressing scheduling, counsel for
7
1150370
Worthington stated that, because a response to Worthington's
motion for a partial summary judgment had not been filed, he
assumed that liability would not be in question and that the
only issue would be damages under the UIM policy.
At 4:28 p.m. on August 10, 2015, Worthington filed a
motion in limine. Among other things, she sought to exclude
any evidence, mention, reference, or attempt to introduce
evidence of the settlement between Worthington and Thomas. In
her motion, Worthington argued:
"The settlement between [Worthington] and Ms.
Thomas is completely irrelevant to Travelers'
liability, and it is not admissible. Evidence must
be excluded under Ala. R. Evid. 403 if 'its
probative value is substantially outweighed by the
danger of unfair prejudice, confusion of the issues,
or misleading the jury, or by considerations of
undue delay, waste of time, or needless presentation
of cumulative evidence.' Evidence of the settlement
is inadmissible because it has nothing to do with
the issue before this Court, and it will only serve
to confuse the jury."
Travelers did not respond to the motion in limine. The record
does not reflect a ruling by the trial court on the motion.
In fact, the notation on the case-action-summary sheet
includes an entry on August 13, 2015, that states: "C002-IN
LIMINE/NO ACTION." However, Travelers asserts that it is
undisputed that the trial court granted the motion in limine.
8
1150370
The case was called for trial at 9:00 a.m. on August 11,
2015. Travelers did not raise any arguments regarding the
settlement
agreement
between
Worthington
and
Thomas.
Additionally,
it
never
asserted
that
Worthington had
forfeited
her coverage under the policy by entering into the settlement
agreement with Thomas without providing Travelers notice of
the settlement and did not move to amend its answer to include
a forfeiture-of-coverage defense. Subsequently, the trial
court conducted voir dire, the jury was empaneled, and the
trial was then recessed for the day at 2:00 p.m.
At 8:44 a.m. on August 12, 2015, Worthington and Thomas
filed a "Stipulation and Agreement to Dismiss Fewer Than All
Defendants" in which they represented that "they have resolved
the differences between themselves and agree for and request
the Court to dismiss all of said plaintiff's claims against
said defendant with prejudice. It is expressly understood
that the plaintiff's claims as to remaining defendant,
Travelers Indemnity Company of Connecticut, remain active and
pending." The trial court subsequently entered an order
dismissing Worthington's claims against Thomas with prejudice
9
1150370
and dismissing Thomas from the action.2 Travelers did not
respond to this motion or object to Thomas's dismissal.
The trial of this case resumed at 9:00 a.m. on August 12,
2015. Again, Travelers did not raise any argument that
Worthington had forfeited her UIM coverage by settling her
claims against Thomas without first complying with the
procedures set out in Lambert and in the UIM policy. In fact,
after the trial court gave the jury its preliminary
instructions,
the
following
occurred
during
a
bench
conference:
"[DEFENSE COUNSEL]: Your Honor, yesterday
afternoon we talked about the policy and the payment
and we had represented to the Court that we were not
going to contest that the policy was in force and
effect at the time. And it's my understanding that
[Worthington's counsel] is going to at some point
read a portion of the policy to the jury and I would
just object to that on the record because it's not
relevant.
"THE COURT: If there's no dispute about the
policy being in question and covered, I wouldn't get
into the details of it would be my thinking. I
agree with that. Tell me what y'all's thoughts are.
"[WORTHINGTON'S COUNSEL]: My thought is this:
First of all, if it's an exhibit that goes into
evidence, I think we have a right to refer to it.
2The trial court dated the order August 12, 2015, but it
was not electronically filed until August 18, 2015. See Rule
58(c), Ala. R. Civ. P.
10
1150370
I think that's first. So if the policy comes into
evidence, and I think we have the right to offer it
into evidence, then I think any kind of exhibits
that's there we've got a right to refer to.
"But secondly, and importantly, this is a
contract entered into between Travelers and this
family. She has a right I think to refer and point
out to the jury these are the provisions of the
contract, you know, we bought this contract and this
is what covers it. A lot of the jurors in --
prospective jurors had questions about, you know,
was this covered by the policy whatnot and we simply
want to early in her testimony offer the contract,
show she paid for it, and refer them to the
uninsured motorists portion of the policy.
"And our thought is that if it's an exhibit, and
certainly, the contract should be able to be offered
into evidence and if it's an exhibit that's admitted
into evidence, we ought to have a right to refer to
it. I don't expect to belabor it.
"THE COURT: My only thought is certainly you're
going to do all [that] if you're trying to prove was
there a contract in force and effect, but if the
defendant is stipulating to the fact that there is
a contract in force and effect and she's covered by
this and we acknowledge that she's covered, to me,
you know, that's my concern.
"[DEFENSE COUNSEL]: Yes, sir. I don't object
to the introduction of the contract into evidence in
the first place.
"[WORTHINGTON'S
COUNSEL]:
Well,
then
I'd
like
--
I just would like to go further to say that this
type of -- I'd like for them to admit if that's --
first of all, I'll do whatever the Court obviously
instructs.
11
1150370
"THE COURT: I just want to, you know, I don't
want to overdo something. I want to be very clear
about it. He's agreeing to it and is there any
need, is my only thought.
"[WORTHINGTON'S COUNSEL]: And that's fine so
long as we can stand up and say there is absolutely
no dispute by Travelers that this is a type of
policy that covers exactly what we're standing here
for. Now, if they're --
"THE COURT: I thought that's where we were
yesterday and you're good with that.
"[DEFENSE COUNSEL]: Yes, sir. There's no
question that policy was --
"THE COURT: I tend to agree. I think it's
almost a stipulation.
"[WORTHINGTON'S COUNSEL]: That's fine.
"THE COURT: Are y'all good with that?
"[WORTHINGTON'S COUNSEL]: Yes, sir.
"THE COURT: All right. We'll do it that way."
Throughout the trial, Worthington and Travelers stated
that the only issue before the jury was the amount of damages
Worthington was entitled to recover as a result of the
accident. In its opening statement, defense counsel stated:
"Ladies and gentlemen, the essence of the case and
why you're here is basically this: We had a number,
a monetary figure. They are correct in saying we
don't dispute that Mrs. Worthington was injured, we
don't dispute it wasn't her fault. Generally
speaking, cases come before juries in two situations
12
1150370
in car wrecks like this. One is that there's a
dispute about whose fault it is. A classic
situation of intersection, red light, each person
says the other had the green light. That's where
you dispute liability.
"The other kind is when you have a dispute over
how much the case is worth and that's what we're
here about today. I'm not going to tell you that
Mrs. Worthington is not injured. If that's not
true, I'm not going to tell you it was not, it was
her fault. It wasn't her fault. That's not true.
Mrs. Thomas rear-ended her, and she hurt her knees.
That will be all correct. We don't dispute that.
"What the disagreement is about is what the case
is worth. And Mr. and Mrs. Worthington did have a
policy of insurance with Travelers, what's called
underinsured motorist coverage. And I'm sure you've
noticed Mrs. Thomas is not here today because that
part of the case has been resolved. And they told
you you're not to concern yourself with how much the
policy is with us, you're not to concern yourself
with how much the policy was with Mrs. Thomas. The
dispute is what damages.
"At the end of the day, end of the trial, they
are going to come in here and ask you for money and
say Mrs. Worthington deserves X amount of money.
Guess what. I'm going to tell you the same thing.
Tell you she deserves money, she needs to be
compensated. The issue is going to be their numbers
will be different from mine for my opinion differs
from theirs on what the case is worth. Nobody is
here saying she's not hurt. Nobody is saying here
that it was her fault."
(Emphasis added.)
Before the first witness testified, the trial court
instructed the jury as follows:
13
1150370
"All right. Ladies and gentlemen of the jury,
we're now ready to call the first witness. Prior to
doing that, there's been a stipulation that I want
to clarify for the record. I think it was pretty
well brought out in opening statements, but I want
to clarify that. There is a stipulation that there
is a policy in force and effect from Travelers, the
defendant, called underinsured or uninsured motorist
coverage. That policy is in place. The plaintiff
is protected by that policy and the injuries in
question will be covered by that policy. There's no
question about that. There was some questions with
regard to getting the policy in evidence. My ruling
is that it's irrelevant. They've stipulated that
the policy is in force and effect and that's the
ruling of the Court, okay. Everybody clear? No
question about that."
(Emphasis added.)
Worthington testified at trial and presented the
testimony of four additional witnesses. Travelers did not
call any witnesses on its behalf. Additionally, Travelers did
not move for a judgment as a matter of law at the close of
Worthington's evidence or at the close of all the evidence.
During the defense's closing argument, defense counsel
stated:
"And if you remember when I talked to you in the
opening statements, that's what I told you you were
going to have to do (inaudible) to ask for a number.
Because like they have already said and what I've
already told you, there's no dispute about the
accident, there's no dispute that Mrs. Worthington
got hurt. We just have a dispute about what the
value of the case is.
14
1150370
"And I'm going to tell you right now, you should
award Mrs. Worthington damages [for] the medical
expenses. That should be part of your verdict.
Absolutely. Because it wouldn't be fair for her not
to be compensated for something she has to pay for
already. So that's certainly something you should
include and you probably should include that in an
amount for pain and suffering because there's no
dispute that her knees still hurt and that's been
all through her life and it's affected her life.
And Judge will tell you there's no set standard for
pain and suffering. That's something you're giving
a judgment from twelve people."
(Emphasis added.) Finally, in its jury charge, the trial
court instructed the jury as follows:
"The parties have stipulated in this case that
the
other
driver,
Camille
Wilson
Thomas,
neglectfully drove a vehicle causing it to rear-end
the vehicle that the plaintiff was a passenger in
and caused harm to this plaintiff. The plaintiff,
Angela Worthington, says that the other driver,
Camille Wilson Thomas, was an underinsured motorist.
Because the other driver, Camille Wilson Thomas, did
not have enough liability insurance coverage, the
plaintiff, Angela Worthington, says that she can
recover under her own policy, Travelers, for these
underinsured benefit claims.
"The parties have stipulated that the plaintiff
had such as a policy of insurance with Travelers,
that it was in effect on the date in question and
that the policy had underinsured motorist benefit
coverage. The parties further stipulate that the
other driver had liability insurance. The parties
further stipulate that the other driver, Camille
Wilson Thomas, was negligent in the operation of her
vehicle which caused the wreck and caused damage to
plaintiff. The parties further stipulate that the
15
1150370
other driver's negligent conduct did cause the
plaintiff her injury.
"It is for you, the jury, to find for this
plaintiff and then to determine how much money to be
awarded to her for the harm that's been caused by
the other driver, Camille Wilson Thomas. When
deciding how much to award, the amount of the other
driver's liability insurance and the amount of the
plaintiff's underinsured motorist coverage are not
important. The determination and the allocation for
this will be handled by this Court after we receive
your
verdict.
The
controversy
for
your
determination as the jury is simply the appropriate
amount of damages to be awarded to this plaintiff."
(Emphasis added.)
On August 13, 2015, the jury returned a verdict in favor
of Worthington and against Travelers. The jury assessed
Worthington's damages at $1,100,000. On that same day, the
trial court entered its judgment on the jury's verdict; found
that Thomas had previously paid Worthington "$100,000 to
fully
resolve [Worthington's] claims against [Thomas]" and that
Travelers was entitled to a credit in that amount; and entered
a judgment in favor of Worthington and against Travelers for
the net amount of $1,000,000.
On September 9, 2015, Travelers filed a "Motion for
Judgment
to
Alter,
Amend,
or
Vacate
Judgment,
or,
16
1150370
Alternatively,
Motion
for
New
Trial,
or
Motion
for
Remittitur." In its motion, Travelers argued:
"The judgment in this case is due to be vacated.
Alabama law clearly provides that a plaintiff
seeking underinsured motorist (UIM) benefits from
her insurance carrier must comply with the notice
requirements set out by the Alabama Supreme Court in
Lambert v. State Farm Mutual Automobile Insurance
Co., [576] So. 2d 160 (Ala. 1991). A plaintiff who
fails to do so forfeits her right to any UIM
coverage under the insurance policy. In the present
case, Plaintiff entered into a settlement with the
tortfeasor less than twenty-four hours before her
case against Travelers for UIM coverage was set to
begin. Plaintiff did so without disclosing the
settlement to Travelers until after the fact and
without giving Travelers an opportunity to exercise
its rights under Lambert. In taking this action in
contravention of Alabama law, Plaintiff not only
violated Lambert but she also violated the clear
terms of the Travelers policy. As a result, this
Court's judgment against Travelers is due to be
vacated and, instead, judgment is due to be entered
in favor of Travelers."
Travelers also argued:
"In the present case, Plaintiff's direct
violation and breach of the conditions of the UIM
policy and Alabama law warrant that the August 13,
2015 Judgment be vacated. The August 11-13, 2015
trial of this action concerned the amount of damages
to which Plaintiff might be entitled as a result of
the April 27, 2011 automobile accident. Although
the jury returned a verdict in Plaintiff's favor,
Plaintiff forfeited all coverage under the Travelers
policy when, on the eve of trial, she settled and
released the tortfeasor before notifying Travelers
of the proposed agreement and without providing
Travelers with the opportunity to maintain the
17
1150370
rights to which it is entitled under Alabama law.
Accordingly, the August 13, 2015 Judgment is
inappropriate and cannot be enforced.
"....
"Under
Alabama law
and
the
express provisions of
the policy, Plaintiff was required to provide
Travelers with thirty (30) days notice to consider
the proposed settlement and determine whether it
would front the settlement to maintain its rights,
including the right to keep the tortfeasor in the
case. Here, it is undisputed that Plaintiff's
release of all claims against the tortfeasor
occurred within forty-eight hours of her agreement
to settle with the tortfeasor. Under controlling
Alabama law, Plaintiff's blatant failure to comply
with the Lambert requirements and the terms of the
Travelers policy results in her forfeiture of any
and all rights to UIM benefits under the Travelers
Policy. Accordingly, the August 13, 2015 Judgment
is unenforceable and is due to be vacated.
"....
"Here, a new trial is warranted because the
trial of Plaintiff's UIM claim against Travelers was
inappropriate. As set forth more fully above,
Plaintiff violated the Lambert requirements by
settling her claims against the tortfeasor before
notifying Travelers of the proposed agreement and
without providing Travelers a reasonable time in
which to consider the proposed settlement and its
position with respect to same. Thus, the rights
granted to Travelers under well-settled Alabama law
were violated by the settlement that resulted in the
dismissal of the tortfeasor on the eve of trial.
"....
"Thus, should this Court decline to vacate the
August 13, 2015 Judgment, Travelers is entitled to
18
1150370
a new trial so that the rights guaranteed under
Lambert can be enforced. Of course, those rights
can only be maintained in full if the order
dismissing the tortfeasor is vacated. Accordingly,
the August 12, 2015 Judgment whereby the tortfeasor
was released is also due to be reversed, so as to
permit Travelers a reasonable time to consider the
proposed settlement and advise the parties of its
position, as set forth in Lambert, supra."3
In a response in opposition to Travelers' postjudgment
motion, Worthington asserted that Travelers had "waived any
defense to the applicability and enforceability of the
uninsured motorist contract at issue." Specifically, she
alleged that Travelers had "stipulated at trial to the
existence
of
uninsured
motorist
contract
and
its
applicability
and enforceability to the wreck at issue in this case." She
also pointed out that, at trial, Travelers objected to the
introduction of the UIM policy and admitted that, under the
policy, it was liable for any verdict in excess of the limits
of Thomas's policy. Worthington asserted that the doctrine of
3In its postjudgment motion, Travelers also argued that,
if the trial court determined that it was not entitled to a
new trial with regard to its Lambert claim, it was "entitled
to a new trial based on the excessiveness of the damages, or,
alternatively, remittitur of the jury's award." However, it
does not raise its arguments regarding the excessiveness of
the damages award on appeal. Therefore, Travelers has
abandoned any argument that the damages award is excessive.
See Alfa Life Ins. Corp. v. Jackson, 906 So. 2d 143 (Ala.
2005).
19
1150370
waiver would preclude Travelers from raising the arguments
asserted in its postjudgment motion; that Travelers should be
estopped from asserting any policy defense; and that the
doctrine of issue preclusion would prohibit Travelers from
contesting the enforceability and applicability of the UIM
coverage. She also asserted that Travelers should be barred
from raising this forfeiture-of-coverage defense because it
had failed to plead it as an affirmative defense or to assert
a
counterclaim
alleging
breach
of
contract
against
Worthington. Worthington asserted that Travelers' attempt to
avoid insurance coverage at that late date would be precluded
under the doctrines of res judicata and collateral estoppel.
She further argued:
"Defendant
Travelers
stipulated
to
the
enforceability, applicability, and the fact that any
jury verdict in excess of the tortfeasor's policy
limits would be covered under the subject uninsured
motorist policy, up to its limits of $1 million.
Defendant Travelers cannot now avoid its stipulation
and re-litigate issues that have been previously
stipulated."
In their filings, the parties indicate that the trial
court conducted a hearing on Travelers' postjudgment motion.
However, the record on appeal does not include a transcript of
that hearing. On November 30, 2015, the trial court entered
20
1150370
an order in which it denied Travelers' postjudgment motion.
This appeal followed.
Discussion
A.
Travelers argues that the record on appeal was improperly
supplemented with a transcript of the trial proceedings in
this case. In its brief to this Court, it contends:
"As this Court recognized, the record on appeal
may only be supplemented to 'include matters which
were
in
evidence
at
the
trial
level
and
inadvertently omitted from the record on appeal.'
Richburg v. Cromwell, 428 So. 2d 621, 622 (Ala.
1983). Alabama Rules of Appellate Procedure 10(f)
'was never intended to allow a matter to be included
in the record on appeal which was not before the
trial court.' Richburg, 428 So. 2d at 622. Thus,
supplementation of the record on appeal with the
trial transcript, which was never submitted by any
party to the trial court, constituted an abuse of
discretion."
(Travelers' brief, at p. 37.) Travelers goes on to argue
that, because Worthington did not submit a transcript of the
trial as evidence during the postjudgment proceedings, this
Court cannot consider the trial transcript in ruling on this
appeal.4
4This is not the first time Travelers has challenged the
trial court's granting of the motion to supplement the record
on appeal in this Court. On May 20, 2016, Travelers filed a
petition for a writ of mandamus in which it asked this Court
21
1150370
None of the cases cited by Travelers in support of its
argument in this regard discuss supplementing the record on
appeal with a transcript of the trial proceedings from the
case that is on appeal; rather, they address only the general
principles of law that Rule 10(f), Ala. R. App. P., does not
allow the record on appeal to be supplemented with evidence
that was not before the trial court and that this Court cannot
consider evidence that was not before the trial court.
However, in the case, the trial judge who ruled on the
postjudgment also presided over the trial. Thus, the trial
judge had personal knowledge of what transpired during the
trial. Therefore, this Court's consideration of the trial
transcript would not constitute consideration of matters that
were not before the trial court. Additionally, Travelers has
to order the trial court to vacate its May 9, 2016, order
granting Worthington's motion to supplement the record on
appeal. (Supreme Court no. 1150872.) In that petition,
Travelers argued that Worthington should not be allowed to
supplement the record on appeal pursuant to Rule 10(f), Ala.
R. App. P., because she did not file a transcript-purchase-
order form pursuant to Rule 10(b), Ala. R. App. P. Travelers
did not argue in its petition that the trial court erroneously
granted the motion to supplement because the trial transcript
had not been submitted as evidence during the proceedings on
the postjudgment motion. This Court initially ordered answer
briefs. However, on February 2, 2017, this Court denied
Travelers' petition without an opinion.
22
1150370
not presented to this Court any authority to support its
specific assertion that consideration of the trial transcript
under the facts in this case would actually constitute
consideration of matters or evidence that was not before the
trial court.
"'"It is well established that general
propositions of law are not considered
'supporting
authority'
for
purposes
of
Rule
28[, Ala. R. App. P.]. Ex parte Riley, 464
So. 2d 92 (Ala. 1985)." S.B. v. Saint
James Sch., 959 So. 2d 72, 89 (Ala. 2006).
This Court will not "create legal arguments
for a party based on undelineated general
propositions unsupported by authority or
argument." Spradlin v. Spradlin, 601 So. 2d
76, 79 (Ala. 1992). Further, it is well
settled that "'[w]here an appellant fails
to cite any authority for an argument, this
Court may affirm the judgment as to those
issues, for it is neither this Court's duty
nor its function to perform all the legal
research for an appellant.'" Spradlin v.
Birmingham Airport Auth., 613 So. 2d 347,
348 (Ala. 1993)(quoting Sea Calm Shipping
Co., S.A. v. Cooks, 565 So. 2d 212, 216
(Ala. 1990)).'
"Allsopp v. Bolding, 86 So. 3d 952, 960 (Ala.
2011)."
Harris v. Owens, 105 So. 3d 430, 436 (Ala. 2012). Because the
citations to authority included in Travelers' argument stand
for only general propositions of law, its argument that
Worthington should not have been allowed to supplement the
23
1150370
record with a transcript of the trial proceedings does not
comply with Rule 28(a)(10), Ala. R. App. P., and we will not
consider it.
B.
Travelers also argues that the trial court erred in
denying its postjudgment motion to vacate its judgment in
favor of Worthington. (Issues I and II in Travelers' brief.)
Specifically, it contends that, when Worthington entered into
the settlement agreement with Thomas without first complying
with the Lambert framework, she automatically forfeited her
UIM coverage and the trial court could not have entered a
judgment in her favor.
In Lambert, this Court addressed the procedure to be
applied in a case in which the UM/UIM policy includes a
consent-to-settle clause:
"In this opinion, we set out the procedure that
should be followed in every case in which the rights
of the insured and the underinsured motorist
insurance carrier may conflict.
"Necessarily, any procedure must take into
consideration the facts and circumstances of each
individual case, but the following general rules
should apply:
"(1) The insured, or the insured's
counsel,
should
give
notice
to
the
24
1150370
underinsured motorist insurance carrier of
the
claim
under
the
policy
for
underinsurance benefits as soon as it
appears that the insured's damages may
exceed
the
tortfeasor's
limits
of
liability
coverage.
"(2) If the tort-feasor's liability
insurance carrier and the insured enter
into negotiations that ultimately lead to
a proposed compromise or settlement of the
insured's claim against the tort-feasor,
and if the settlement would release the
tort-feasor from all liability, then the
insured,
before
agreeing
to
the
settlement,
should immediately notify the underinsured
motorist insurance carrier of the proposed
settlement and the terms of any proposed
release.
"(3) At the time the insured informs
the
underinsured
motorist
insurance
carrier
of the tort-feasor's intent to settle, the
insured should also inform the carrier as
to
whether
the
insured
will
seek
underinsured motorist benefits in addition
to
the
benefits
payable
under
the
settlement proposal, so that the carrier
can determine whether it will refuse to
consent to the settlement, will waive its
right
of
subrogation
against
the
tort-feasor, or will deny any obligation to
pay underinsured motorist benefits. If the
insured gives the underinsured motorist
insurance carrier notice of the claim for
underinsured motorist benefits, as may be
provided for in the policy, the carrier
should immediately begin investigating the
claim, should conclude such investigation
within a reasonable time, and should notify
its insured of the action it proposes with
25
1150370
regard to the claim for underinsured
motorist benefits.
"(4) The insured should not settle
with
the
tort-feasor
without
first
allowing
the
underinsured
motorist
insurance
carrier
a
reasonable
time
within
which
to
investigate the insured's claim and to
notify its insured of its proposed action.
"(5)
If
the
uninsured
motorist
insurance carrier refuses to consent to a
settlement by its insured with the tort-
feasor, or if the carrier denies the claim
of its insured without a good faith
investigation into its merits, or if the
carrier does not conduct its investigation
in a reasonable time, the carrier would, by
any of those actions, waive any right to
subrogation against the tort-feasor or the
tort-feasor's insurer.
"(6) If the underinsured motorist
insurance carrier wants to protect its
subrogation rights, it must, within a
reasonable time, and, in any event before
the
tort-feasor
is
released
by
the
carrier's insured, advance to its insured
an amount equal to the tort-feasor's
settlement offer.
"These general guidelines should be applied with the
understanding that the purpose of consent-to-settle
clauses in the uninsured/underinsured motorist
insurance context is to protect the underinsured
motorist insurance carrier's subrogation rights
against the tort-feasor, as well as to protect the
carrier against the possibility of collusion between
its insured and the tortfeasor's liability insurer
at the carrier's expense.
"....
26
1150370
"This Court stated in Lowe v. Nationwide Ins.
Co., 521 So. 2d 1309 (Ala. 1988), that there are
three primary concerns in an insurance claim
involving underinsured motorist insurance coverage:
"'1) that of protecting the right of the
[underinsured motorist insurance carrier]
to know of, and participate in, the suit;
2) that of protecting the right of the
insured to litigate all aspects of his
claim in a single suit ...[;] and 3) that
of protecting the liability phase of the
trial from the introduction of extraneous
and
corrupting
influences,
namely,
evidence
of insurance....'
"521 So. 2d at 1309."
576 So. 2d at 167-68 (emphasis added). Although Lambert
addressed the general procedures to be followed with regard to
settlements in such cases, it did not address the issue of
when and how an insurance company must raise a defense based
on the insured's failure to comply with the Lambert procedures
during litigation between the company and its insured.
Travelers also cites several other Alabama cases for the
general proposition that "any insured who fails to comply with
Lambert's notice requirements forfeits any and all rights to
UIM benefits under the policy." Those cases set forth general
propositions of law regarding the application of Lambert and
the failure to comply with the notice requirement set forth in
27
1150370
Lambert. Again, those cases do not address the issue of when
and how an insurance company must raise a forfeiture defense
during litigation with its insured.
In Tounzen v. Southern United Fire Insurance Co., 701 So.
2d 1148 (Ala. Civ. App. 1997), the Court of Civil Appeals
stated:
"On appeal, the Tounzens argue that the trial
court erred in directing the verdict because
Southern United failed to specifically plead the
settlement and release of McGuire as an affirmative
defense in its answer to the Tounzens' complaint.
The relevant policy provision at issue states:
"'SECTION
C
--
UNINSURED
MOTORISTS
INSURANCE
"'I. COVERAGE D -- UNINSURED MOTORISTS
(Damages for Bodily Injury):
"'Exclusions: This insurance
does not apply:
"'(a) to bodily injury
to
an
insured
with
respect to which such
insured,
his
legal
representative or any
person
entitled
to
payment
under
this
i n s u r a n c e
s h a l l ,
without written consent
of the company, make
any settlement with any
person or organization
l e g a l l y
l i a b l e
therefor.'
28
1150370
"It is undisputed that the Tounzens did not
receive written consent from Southern United to
settle
with
State
Farm
Insurance
Company,
Mc[G]uire's liability insurance carrier. The
settlement between the Tounzens and State Farm, when
asserted by Southern United as a defense to avoid
payment under its own uninsured motorist policy, is
an affirmative defense. Southern United admitted at
trial that the defense had occurred to it only days
before trial and that it gave notice of this defense
to the Tounzens and the trial court shortly before
trial. It is undisputed that Southern United
amended its pleadings in open court during the
trial.
"Rule 8(c), Ala. R. Civ. P., provides:
"'Affirmative Defenses. 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
avoidance
or
affirmative
defense.'
"(Emphasis added.)
"Rule 8(c) provides that affirmative defenses
'shall' be raised in a responsive pleading;
generally, when a party has failed to plead an
affirmative defense, it is deemed to have been
waived by operation of Rule 8(c). Harrell v. Pet,
Inc., Bakery Div., 664 So. 2d 204 (Ala. Civ. App.
1994). However, Rule 8(c) must be read in
conjunction with Rule 15(b), Ala. R. Civ. P. Rule
15 provides for the automatic amendment of pleadings
29
1150370
to allow the pleadings to conform to the evidence
that has been presented at trial. Rule 15(b) is an
exception to the rule that an affirmative defense is
waived if it is not specifically pleaded. Mid–South
Credit Collection v. McCleskey, 587 So. 2d 1212
(Ala. Civ. App. 1991).
"Rule 15(b), Ala. R. Civ. P., provides in part:
"'If evidence is objected to at the trial
on the ground that it is not within the
issues made by the pleadings, the court may
allow the pleadings to be amended and shall
do so freely when the presentation of the
merits of the action will be subserved
thereby and the objecting party fails to
satisfy the court that the admission of
such evidence would prejudice him in the
maintaining of his action or defense upon
the merits. The court may grant a
continuance to enable the objecting party
to meet such evidence.'
"(Emphasis supplied.)
"Under Rule 15, amendments are to be freely
allowed when justice requires. Thurman v. Thurman,
454 So. 2d 995 (Ala. Civ. App. 1984). Even as late
as the date of trial, the trial court has the
authority to allow an amendment. Robinson v. Morse,
352 So. 2d 1355 (Ala. 1977). The typical Rule 15(b)
case involves a situation in which a party, at trial
and without objection from an opposing party,
presents evidence that gives rise to an issue that
was not pleaded. It has been consistently held that
when issues that have not been raised in the
pleadings are tried by the express or implied
consent of the parties, those issues are treated in
all respects as if they had been raised in the
pleadings. Rule 15(b), Ala. R. Civ. P.; Hosea O.
Weaver & Sons, Inc. v. Towner, 663 So. 2d 892 (Ala.
1995); McCollum v. Reeves, 521 So. 2d 13 (Ala.
30
1150370
1987); Havard v. Havard, 652 So. 2d 304 (Ala. Civ.
App. 1994).
"It is within the discretion of the trial court
to decide whether to grant an amendment pursuant to
Rule 15, Ala. R. Civ. P. Miller v. Bell Richardson,
P.A., 638 So. 2d 6 (Ala. Civ. App. 1994). Only
where the trial court abuses its discretion in
allowing or denying a Rule 15 amendment will this
court reverse. Havard v. Havard, supra.
"'"[I]f Rule 15 is to be of any benefit to
the bench, bar, and the public, the trial
judges must be given discretion to allow or
refuse amendments.... We state also that
Rule 15 must be liberally construed by the
trial judges. But, that liberality does
not include a situation where the trial on
the issues will be unduly delayed or the
opposing party unduly prejudiced."'
"Hayes v. Payne, 523 So. 2d 333, 334 (Ala. 1987)
(quoting Stead v. Blue Cross–Blue Shield of Alabama,
294 Ala. 3, 6, 310 So. 2d 469, 471 (1975))."
701 So. 3d at 1149-51 (some emphasis added).
This case presents a unique factual situation. Because
Worthington did not enter into the settlement agreement with
Thomas until the day before the trial was scheduled to begin,
this was obviously not a situation where Travelers could have
raised the affirmative defense of forfeiture of coverage in
its answer. However, "even as late as the date of trial the
trial court has the authority to allow an amendment."
Tounzen, 701 So. 3d at 1150. Thus, once Travelers learned of
31
1150370
the settlement agreement between Worthington and Thomas, it
could have sought to amend its answer to assert the defense of
forfeiture of coverage, even on the date of trial; it never
did so. Also, at no time before the trial started or at any
time during the trial proceedings did Travelers present to the
trial court its argument that Worthington had forfeited
coverage by entering into the settlement agreement with
Thomas. Rather, it proceeded to trial on a stipulation that
UIM coverage existed and that the policy covered the claims
asserted by Worthington. Travelers also conceded that Thomas
was negligent; that Worthington was not at fault; and that
Worthington had sustained injuries as a result of the
accident. In fact, Travelers went so far as to tell the jury
in closing arguments that it should return a verdict in favor
of Worthington and that the only dispute was the amount of
damages that should be awarded. Travelers never raised the
affirmative defense that Worthington had forfeited her UIM
coverage by entering into the settlement agreement without
first providing notice pursuant to the procedures set forth in
Lambert and in the Travelers policy during the trial. It was
only after the jury had returned a verdict in favor of
32
1150370
Worthington for $1.1 million that Travelers filed a
postjudgment motion raising this defense for the first time.
In Special Assets, L.L.C. v. Chase Home Finance, L.L.C.,
991 So. 2d 668, 675-78 (Ala. 2007), this Court addressed a
situation where the defendants raised the affirmative defense
of the statute of limitations for the first time in a
postjudgment motion:
"Chase Finance contends that First Properties
and Special Assets did not timely raise the statute
of limitations as a defense, that the trial court
did not consider the merits of that defense, and
that the trial court did not exceed its discretion
in refusing to do so. We agree. A defense based on
a statute of limitations is an affirmative defense.
Rule 8(c), Ala. R. Civ. P. '"Typically, if a party
fails to plead an affirmative defense, that defense
is deemed to have been waived."' Ziade v. Koch, 952
So. 2d 1072, 1075 (Ala. 2006). In its responsive
pleadings, First Properties did not plead the
statute of limitations as a defense. Moreover, in
its materials before the entry of the summary
judgments, First Properties did not assert that
Chase Finance's claims were barred by the statute of
limitations as a defense. Instead, First Properties
raised the statute of limitations as a defense for
the first time when it filed its postjudgment motion
under Rule 59(e), Ala. R. Civ. P. Consequently, by
not pleading or asserting the affirmative defense of
the statute of limitations until after the trial
court had entered a summary judgment against it,
First Properties waived its right to assert that
defense. Giles v. Ingrum, 583 So. 2d 1287, 1289
(Ala. 1987).
33
1150370
"Chase Finance points out that in its answer
Special Assets made the general statement that it
'asserts the defenses of waiver, estoppel, laches,
lapse, and the applicable statutes of limitation.'
However, Chase Finance also notes that, like First
Properties,
Special
Assets
made
no
argument
regarding the statute of limitations in the
materials it filed before summary judgment. Thus,
Special
Assets
waited
until
it
filed
its
postjudgment motion under Rule 59(e), Ala. R. Civ.
P., to attempt to prove that Chase Finance's claims
were untimely.
"In its briefs to this Court, Special Assets
does not address whether its general assertion of
the statute-of-limitations defense in its answer was
sufficient to prevent a finding that its failure to
attempt to prove the defense until its postjudgment
motion constituted a waiver of the defense.
Instead, Special Assets argues, as does First
Properties, that this Court may review the merits of
the statute-of-limitations defense because (1) the
defense was asserted in postjudgment materials, and
(2) First Properties and Special Assets contend, in
ruling on their postjudgment motion under Rule
59(e), Ala. R. Civ. P., the trial court 'considered'
the statute-of-limitations defense and rejected it
on the merits.
"First Properties and Special Assets cite this
Court's decision in Maxwell v. Dawkins, 974 So. 2d
282 (Ala. 2006). Maxwell involved a will contest
between Robert Maxwell, Jr., and Dollye Diane
Dawkins. Robert sought to probate a will signed by
the testator in September 2002, but Dawkins
contended that the September 2002 will had been
revoked in August 2004. The trial court entered an
order granting Dawkins's motion for a summary
judgment and holding that there had been a valid
revocation of the September 2002 will. 974 So. 2d
at 284.
34
1150370
"Robert filed a 'motion to reconsider' in which
he 'raised for the first time the issue whether [the
testator] had, on August 25, 2004, the mental
capacity to revoke his will.' 974 So. 2d at 284.
The trial court then entered an order amending its
earlier judgment and stating specifically that '"the
testator at the time of the act of signing beneath
the
words
of
revocation
possessed
sufficient
capacity to revoke his will."' 974 So. 2d at 284.
"On
appeal to
this Court, Dawkins contended that
Robert had waived the issue of mental capacity and
could not raise it on appeal because, she argued,
'Robert [had] not articulate[d] this argument in his
summary-judgment motion, in his response opposing
Dawkins's summary-judgment motion, or in his reply
to Dawkins's response to his summary-judgment
motion.' 974 So. 2d at 286. This Court rejected
Dawkins's argument, however.
"Although Robert had
not
timely raised the
issue
of mental capacity and the trial court therefore was
under no obligation to consider it, 'the trial court
[had] the discretion to consider the argument, and
it appear[ed] to have done so.' 974 So. 2d at 286.
Because the trial court had amended its judgment to
state specifically that the testator had the mental
capacity to revoke his will, the trial court had
ruled on the issue, and 'Robert may challenge that
ruling on appeal notwithstanding his failure to
raise it before the trial court entered its
judgment.' 974 So. 2d at 286.
"The
trial
court's
order
denying
First
Properties and Special Assets' postjudgment motion
in the present case states in its entirety: 'After
consideration of [First Properties and Special
Assets' postjudgment motion] and [Chase Finance's]
response thereto, the Court concludes that the
motion is due to be denied.' First Properties and
Special Assets contend that the word 'consideration'
in that order means that the trial court ruled on
35
1150370
the merits of their statute-of-limitations argument
in the same way the trial court in Maxwell ruled on
the issue of testamentary capacity.
"We disagree. The trial court in Maxwell
specifically amended its judgment to rule on the
issue of capacity; thus, there was evidence that the
trial court considered a new legal argument raised
for the first time in a postjudgment motion. In the
present case, however, the order of the trial court
denying
First
Properties
and
Special
Assets'
postjudgment motion does not indicate why that
motion was denied. Instead, the basis for its
denial is not discernible from the general language
used in the order.
"It is well settled that '"this Court will
affirm a judgment for any reason supported by the
record that satisfies the requirements of due
process."' Hollis v. City of Brighton, 950 So. 2d
300, 308-09 (Ala. 2006) (quoting Smith v. Mark
Dodge, Inc., 934 So. 2d 375, 380 (Ala. 2006), and
citing Taylor v. Stevenson, 820 So. 2d 810, 814
(Ala. 2001)). Chase Finance argued to the trial
court that, by waiting until after the judgment to
raise it, First Properties and Special Assets waived
the defense of the statute of limitations. However,
neither First Properties nor Special Assets argued
to the trial court that it had timely raised the
defense of the statute of limitations, and neither
offered a reason for the delay in raising or
attempting [to] prove the defense. Thus, in ruling
on First Properties and Special Assets' postjudgment
motion, the trial court had before it the unrebutted
argument that their statute-of-limitations defense
was untimely. Although the trial court had the
discretion
to
consider
the
merits
of
the
statute-of-limitations
defense,
there
is
no
indication that it did so, and we will not presume
to the contrary. See Green Tree Acceptance, Inc. v.
Blalock, 525 So. 2d 1366, 1369 (Ala. 1988) ('[A]
trial court has the discretion to consider a new
36
1150370
legal argument in a post-judgment motion, but is not
required to do so.'). Consequently, First
Properties and Special Assets' arguments regarding
the statute of limitations do not show that the
trial court erred in denying their postjudgment
motion."
(Footnotes omitted.)
In its order denying Travelers' postjudgment motion, the
trial court merely stated:
"Defendant
Travelers
Indemnity
Company
of
Connecticut Motion for Judgment to Alter, Amend, or
Vacate Judgment, Or, Alternatively, Motion for New
Trial, or Motion for Remittitur is hereby Denied."
Although the filings of the parties indicate that the trial
court conducted a hearing on that motion, the record before
this Court does not include a transcript of that hearing. At
most, a letter brief filed by Worthington in opposition to
Travelers'
postjudgment
motion
includes
the
following
statement:
"During oral argument on [Travelers'] motion, Your
Honor posed a hypothetical 'threshold' issue related
to Lambert. Respectfully, [Worthington] believes
the threshold issue is Has Travelers preserved its
right to raise any insurance policy defenses in a
Motion for New Trial."
(Boldface type in original.) There is no indication in the
record that the trial court actually considered the merits of
Travelers' defense that Worthington had forfeited coverage
37
1150370
under her UIM policy. At best, the record indicates that the
trial court was considering whether it should entertain the
new legal argument Travelers presented in its postjudgment
motion.
Travelers argues that Worthington filed a motion in
limine to prevent the introduction of or any reference to the
settlement; that the trial court granted that motion; and
that, therefore, it could not have presented its forfeiture-
of-coverage argument at trial. However, Travelers' argument
in this regard is disingenuous at best. As noted previously,
the record does not include any indication that the trial
court actually granted the motion in limine. Even if the
trial court granted the motion, however, Travelers' argument
is still unavailing. Travelers never presented any argument
in opposition to the motion in limine; it certainly never
argued that the introduction of the settlement agreement was
relevant to the issue whether Worthington had forfeited her
UIM coverage by entering into that settlement. Even if the
trial court did grant the motion in limine, that ruling did
not prevent Travelers from moving for leave to amend its
answer to add the affirmative defense of forfeiture of
38
1150370
coverage or from presenting its argument that Worthington had
forfeited coverage to the trial court outside the presence of
the jury.
Travelers also relies upon this Court's decisions in
Allstate Insurance Co. v. Beavers, 611 So. 2d 348 (Ala. 1992),
and Downey v. Travelers Property Casualty Insurance Co., 74
So. 3d 952 (Ala. 2011), to support its assertion that
Worthington's violation of the procedures in Lambert and the
conditions set out in the Travelers policy "resulted in an
immediate and complete forfeiture of all of her rights to UIM
coverage under Alabama law" and its conclusion that
"Worthington irrevocably forfeited her rights to UIM coverage
before the trial of the case ever began, and Worthington
cannot now restore that coverage by pointing to any post-
settlement conduct by Travelers." (Travelers' brief, at p.
32.) Although the decisions in Allstate and Downey address
the general proposition that an insured waives or forfeits the
right to UIM insurance benefits by failing to comply with the
notice requirements of Lambert, those cases do not address the
proper method by which a UIM carrier should assert a
forfeiture-of-coverage defense in cases where the insured has
39
1150370
failed to comply with those notice requirements. In fact,
Allstate and Downey both involved situations where the
insurance companies had raised their forfeiture defenses
before a judgment was entered. Those cases definitely do not
suggest that a UIM carrier can have pretrial knowledge that
its insured has settled claims against the tortfeasor without
first providing it with notice; proceed to trial as the sole
remaining defendant; stipulate to the existence of UIM
coverage and the tortfeasor's liability; inform the jury that
it should return a verdict for damages in favor of the
insured; argue that the only issue for the jury is the amount
of those damages; and then, after the jury returns a verdict
in favor of the insured, argue for the first time in a
postjudgment motion that the insured has waived or forfeited
her UIM coverage. As this Court has noted:
"This Court has assiduously applied the rule
that a party may not wait until after a verdict has
been rendered before objecting to a procedural
defect, if the objection could have been raised in
a timely manner. See, e.g., Ritchey v. State, 293
Ala. 265, 302 So. 2d 83 (1974); Tucker v. Tucker,
248 Ala. 602, 28 So. 2d 637 (1946); Geter v. Central
Coal Co., 149 Ala. 578, 43 So. 367 (1907); Hall v.
Hall, 421 So. 2d 1270 (Ala. Civ. App. 1982). For
example, in Davis v. Davis, 474 So. 2d 654, 656
(Ala. 1985), this Court held that '[t]he law does
not permit a litigant with knowledge of previously
40
1150370
unserved pleadings and documents to go to trial,
gamble on a favorable outcome at the hands of the
jury, and then, if he loses, raise this deficiency
for the first time [in] a post-trial motion for a
new trial.' This rule is necessary to ensure
fairness at trial, and it supports the public
interest in judicial economy."
Ex parte Eaton, 675 So. 2d 1300, 1301-02 (Ala. 1996). In this
case, Travelers had knowledge of its claim that Worthington
had forfeited her UIM coverage, but it went to trial and
"gamble[d] on a favorable outcome at the hands of the jury."
675 So. 2d at 1302. However, after it lost, it raised its
forfeiture-of-coverage
defense
for the
first
time
in
postjudgment motion. Such conduct flies in the face of the
concept of fairness at trial and undermines the public's
interest in judicial economy.
Moreover,
"'"[a] stipulation is a judicial admission,
dispensing with proof, recognized and enforced by
the courts as a substitute for legal proof."' K.D.
v. Jefferson Cnty. Dep't of Human Res., 88 So. 3d
893, 896 (Ala. Civ. App. 2012) (quoting Spradley v.
State, 414 So. 2d 170, 172 (Ala. Crim. App. 1982)).
The trial court's conclusion that the parties had
stipulated that Patterson's injury arose out of and
in the course of her employment dispensed with the
necessity of proving medical causation, as the
parties implicitly recognized in their stipulation
that '[t]he only issue to be decided by the court in
this matter is the nature and extent of permanent
disability benefits, if any, owed to [Patterson].'
41
1150370
A stipulation is a '"voluntary agreement between
opposing counsel concerning disposition of some
relevant point so as to obviate [the] need for proof
or to narrow [the] range of litigable issues."'
Evans v. Alabama Prof'l Health Consultants, Inc.,
474 So. 2d 86, 88 (Ala. 1985) (quoting Black's Law
Dictionary 1269 (rev. 5th ed. 1979), quoting in turn
Arrington v. State, 233 So. 2d 634, 636 (Fla.
1970)). 'Parties may agree to try their case upon
a theory of their choosing and their agreements
will be binding. Reese Funeral Home v. Kennedy
Electric Co., 370 So. 2d 1030 (Ala. Civ. App. 1979);
Rule 47, A[la]. R. A[pp]. P.' Cotton v. Terry, 495
So. 2d 1077, 1080 (Ala. 1986). '"[O]ne who has
stipulated to certain facts is foreclosed from
repudiating them on appeal."' K.D. v. Jefferson
Cnty. Dep't of Human Res., 88 So. 3d at 897 (quoting
Spradley, 414 So. 2d at 172). See also Vann
Express, Inc. v. Phillips, 539 So. 2d 296, 298 (Ala.
Civ. App. 1988)."
Stericycle, Inc. v. Patterson, 161 So. 3d 1170, 1175-76 (Ala.
Civ. App. 2013). Travelers had knowledge of the settlement
agreement before the trial in this case began. Despite having
that knowledge, Travelers stipulated during the trial that the
Travelers policy with the UIM provision was in place; that
Worthington
was
protected
by
that
policy;
and
that
Worthington's injuries would be covered by that policy. Thus,
Travelers cannot now
repudiate that stipulation based on facts
known to it before it entered into that stipulation.
The record does not indicate that the trial court
considered the merits of Travelers' forfeiture-of-coverage
42
1150370
defense,
and we
will not
presume
that
it
did
so.
Additionally, Travelers has not presented any argument to
establish that the trial court exceeded its discretion in not
considering the merits of its forfeiture-of-coverage defense.
For these reasons, Travelers has not established that the
trial court erred in denying its postjudgment motion, see
Special Assets, 991 So. 2d at 677-78, and we affirm the trial
court's judgment.
AFFIRMED.
Stuart, C.J., and Bolin, Parker, Main, and Bryan, JJ.,
concur.
Murdock, J., concurs in the rationale in part and concurs
in the result.
Shaw, J., concurs in the result.
Sellers, J., dissents.
43
1150370
MURDOCK, Justice (concurring in the rationale in part and
concurring in the result).
I agree with the main opinion that Travelers Indemnity
Company of Connecticut waived its Lambert5 position by failing
to assert that position to the trial court; however, I would
not consider Travelers' failure to have amended its answer as
part of the calculus for this conclusion. In the context of
the
compressed, eve-of-trial and
during-trial
timeline
in
this
case, I agree with the main opinion that our cases
"do not suggest that a UIM carrier can have pretrial
knowledge that its insured has settled claims
against the tortfeasor without first providing it
with notice; proceed to trial as the sole remaining
defendant; stipulate to the existence of UIM
coverage and the tortfeasor's liability; inform the
jury that it should return a verdict for damages in
favor of the insured; argue that the only issue for
the jury is the amount of those damages; and then,
after the jury returns a verdict in favor of the
insured, argue for the first time in a postjudgment
motion that the insured has waived or forfeited her
UIM coverage."
___ So. 3d at ___.
5Lambert v. State Farm Mut. Auto. Ins. Co., 576 So. 2d 160
(Ala. 1991).
44 | October 13, 2017 |
4010e593-202c-4dca-9308-24c0d2dc9566 | Ex parte Certified Auto Sales of Chilton County, LLC, and John Carpenter. | N/A | 1160425 | Alabama | Alabama Supreme Court | IN THE SUPREME COURT OF ALABAMA
November 17, 2017
1160425
Ex parte Certified Auto Sales of Chilton County, LLC, and John Carpenter.
PETITION FOR WRIT OF MANDAMUS: CIVIL (In re: Frances Black v. John
Carpenter and Certified Auto Sales of Chilton County, LLC) (Hale Circuit Court:
CV-16-900075; Civil Appeals :
2160339).
ORDER
The petition for writ of mandamus in this cause is denied.
BOLIN, J. - Stuart, C.J., and Parker, Murdock, Shaw, Main, Wise, Bryan, and
Sellers, JJ., concur.
I, Julia Jordan Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the
foregoing is a full, true, and correct copy of the instrument(s) herewith set out as same
appear(s) of record in said Court.
Witness my hand this 17th day of November, 2017.
/ra | November 17, 2017 |
62b3ee80-97da-4540-8dba-fba2ea303f46 | Ex parte W. R. G. | N/A | 1170114 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1170114
Ex parte W. R. G. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF CRIMINAL
APPEALS (In re: W. R. G. v. State of Alabama) (Walker Circuit Court: CC-13-530; Criminal
Appeals :
CR-16-0461).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Wise, J. - Stuart, C.J., and Parker, Shaw, and Sellers, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
l i t a
Clerk, Supreme Court of Alabama | December 8, 2017 |
8d2ee982-e713-4c34-b69c-6041ad134bec | Ingle v. Adkins | N/A | 1160671 | Alabama | Alabama Supreme Court | Rel: November 9, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
____________________
1160671
____________________
Sheila Mote Ingle
v.
Jason Frank Adkins et al.
Appeal from Walker Circuit Court
(CV-16-900253)
MAIN, Justice.
Sheila Mote Ingle ("Ingle") appeals from an order entered
by the Walker Circuit Court dismissing her claims against
Jason Frank Adkins, individually and in his capacity as
superintendent of the Walker County School System; the Walker
1160671
County Board of Education ("the Board"); and Bradley Glenn
Ingle, William Edward Gilbert, Dennis Dale Reeves, James Lynn
Rigsby, and Sonia Marie Waid, members of the Board
(hereinafter collectively referred to as "the Board members")
(Adkins, the Board, and the Board members are hereinafter
referred to collectively as "the defendants").1 We affirm in
part, reverse in part, and remand.
Facts and Procedural History
On August 4, 2016, Ingle filed in the Walker Circuit
Court a "verified petition for writ of mandamus or in the
alternative for declaratory judgment" against Adkins in his
individual and official capacities, the Board members in
their
individual and official capacities, and the Board.
According to Ingle's petition, Adkins was elected
superintendent of the Walker County School System on November
1It appears that Waid and Reeves are no longer members of
the Board. Shortly after the November 2016 election, Waid and
Reaves moved to have themselves dismissed from the case in
their official capacities because they had ceased to hold
office. Ingle conceded that Waid and Reeves should no longer
be parties to the case in their official capacities, but she
argued that under Rule 25, Ala. R. Civ. P., Waid's and
Reeves's
successors
were
automatically
substituted
as
parties.
The defendants argued that Ingle must "file[] something to
identify [the successors]." The trial court did not make a
specific ruling on this issue.
2
1160671
2, 2010. At the time of Adkins's election, the Board had set
an
annual
salary
of
$139,500
for
the
position
of
superintendent. During a regularly scheduled Board meeting on
July 18, 2013, the Board increased Adkins's salary by 2%
effective July 1, 2013. Adkins was reelected on November 4,
2014. On December 11, 2014, the Board entered into an
"employment contract" with Adkins that would become effective
on January 1, 2015. That contract provided a base annual
salary of $159,500, and it provided for increases in salary
during Adkins's term of office. That contract also provided
an in-county travel stipend of $1,000 per month. The Board
modified the contract on November 12, 2015, to increase
Adkins's compensation. That modification included providing
Adkins with a cellular telephone paid for by the Board,
allowing Adkins to participate in outside activities that do
not interfere with his duties as superintendent and that are
approved by the Board, and guaranteeing that, if "this
agreement be permitted to expire," Adkins could return to a
tenured position with the Walker County School System. Ingle
attached three documents to her petition: (1) a copy of the
minutes from the Board's July 18, 2013, meeting, (2) a copy of
3
1160671
the December 11, 2014, "employment contract," and (3) a copy
of the November 12, 2015, modified contract.
Ingle brought this action "in the name of the State of
Alabama on the relation of Sheila Mote Ingle ... in her
individual capacity as a resident citizen and taxpayer in
Walker County, Alabama." Ingle sought a declaration that
Adkins's July 2013 salary increase was unconstitutional,
illegal, and void; that the December 2014 "employment
contract" was unconstitutional, illegal, and void; and that
the November 2015 modification of the employment contract was
unconstitutional, illegal, and void. Ingle sought to compel
the Board members "to vacate and/or rescind" the "employment
contract." Further, Ingle sought to recover for the taxpayers
of Walker County the allegedly illegal compensation that had
already been paid to Adkins, and she sought to recover on her
own behalf attorney fees. Additionally, Ingle alleged that,
even if the employment contract was not determined to be
unconstitutional and void, the Board had overpaid Adkins's
travel stipend, and, thus, Ingle sought to recover that
overpayment. Later, Ingle amended her petition to withdraw
her claim for attorney fees.
4
1160671
The defendants moved to dismiss Ingle's claims. The
defendants argued that Ingle failed to state a claim upon
which relief could be granted, that Ingle's claims were barred
by the doctrine of immunity, and that Ingle lacked standing to
pursue her claims.
On April 10, 2017, the circuit court issued an order
dismissing Ingle's claims, which stated as follows:
"This cause coming before the Court on the
Motion To Dismiss the Defendants individually and in
their official capacity and with the same being set
for a hearing on April 5, 2017. The hearing was
attended by the attorneys representing the parties
and some parties. The attorneys made arguments to
the Court and presented documents and briefs
contained in the file. The Court having considered
the arguments, documents and briefs and law
presented, it is the opinion of the Court that the
Motion To Dismiss should be granted; therefore, it
is ORDERED, ADJUDGED, and DECREED by the Court that
the Motion To Dismiss is GRANTED as to all
defendants, individually and in their official
capacity."
(Capitalization in original.) Ingle appealed.
Standard of Review
"A ruling on a motion to dismiss is reviewed
without a presumption of correctness. Nance v.
Matthews, 622 So. 2d 297, 299 (Ala. 1993). This
Court must accept the allegations of the complaint
as true. Creola Land Dev., Inc. v. Bentbrooke
Housing, L.L.C., 828 So. 2d 285, 288 (Ala. 2002).
Furthermore, in reviewing a ruling on a motion to
dismiss we will not consider whether the pleader
5
1160671
will ultimately prevail but whether the pleader may
possibly prevail. Nance, 622 So. 2d at 299."
Newman v. Savas, 878 So. 2d 1147, 1148-49 (Ala. 2003).
Discussion
On appeal, Ingle concedes that her claims against the
Board are due to be dismissed on the basis of immunity. She
also admits that she "may not seek damages or to otherwise
impose civil liability on the individual Board members on
account of those acts which have already occurred." Ingle's
brief, at 19. Further, Ingle acknowledges that she may not
have standing "to recover monies which have already been
illegally expended," and she does not set forth any argument
regarding the circuit court's dismissal of her claims
concerning recovery of
compensation that has already been paid
to Adkins. Id. at 26. However, Ingle continues to seek to
enjoin future payments under Adkins's current employment
agreement with the Board, which Ingle claims is an illegal
contract. Thus, on appeal, the issue is whether Ingle can
pursue a claim against the Board members and Adkins in their
individual and/or official capacities to declare Adkins's
current contract illegal and to enjoin future payments from
public funds pursuant to that contract.
6
1160671
First, we hold that the circuit court properly dismissed
the claims against Adkins and the Board members in their
individual capacities because "a suit for injunctive relief
against a State official in his or her individual capacity
would be meaningless. This is so, because State officials act
for and represent the State only in their official
capacities." Ex parte Dickson, 46 So. 3d 468, 474 (Ala. 2010).
Now, we must decide whether Ingle can pursue claims
against the Board members and Adkins in their official
capacities to declare that Adkins's current contract is
illegal and to enjoin payments under that contract going
forward. Specifically, we must decide whether those claims
are barred by the doctrine of immunity and whether Ingle has
standing to pursue those claims.
Concerning immunity, this Court has stated that,
"[b]ecause county boards of education are local agencies of
the State, they are clothed in constitutional immunity from
suit." Ex parte Hale Cty. Bd. of Educ., 14 So. 3d 844, 848
(Ala. 2009). Further,
"'[u]nder Article 1, § 14, Alabama
Constitution of 1901, "the State and its
agencies have absolute immunity from suit
in any court." Phillips v. Thomas, 555 So.
7
1160671
2d 81, 83 (Ala. 1989); see also Taylor v.
Troy State University, 437 So. 2d 472, 474
(Ala. 1983). ... "State officers and
employees,
in
their
official
capacities
and
individually, are also absolutely immune
from suit when the action is, in effect,
one against the state." Phillips v. Thomas,
555 So. 2d at 83; see Taylor v. Troy State
University, 437 So. 2d at 474.'
"Williams v. John C. Calhoun Cmty. Coll., 646 So. 2d
1, 2 (Ala. 1994).
"'"The
wall
of
immunity
erected
by
§
14
is
nearly
impregnable. Sanders Lead Co. v.
Levine, 370 F. Supp. 1115, 1117
(M.D. Ala. 1973); Taylor v. Troy
State Univ., 437 So. 2d 472, 474
(Ala. 1983); Hutchinson v. Board
of Trustees of Univ. of Alabama,
288 Ala. 20, 24, 256 So. 2d 281,
284 (1971). This immunity may not
be waived. Larkins v. Department
of
Mental
Health
&
Mental
Retardation, 806 So. 2d 358, 363
(Ala. 2001) ('The State is immune
from
suit,
and
its
immunity
cannot
be
waived
by
the
Legislature or by any other State
authority.'); Druid City Hosp.
Bd. v. Epperson, 378 So. 2d 696
(Ala. 1979) (same); Opinion of
the Justices No. 69, 247 Ala.
195, 23 So. 2d 505 (1945) (same);
see also Dunn Constr. Co. v.
State Bd. of Adjustment, 234 Ala.
372, 175 So. 383 (1937). 'This
means not only that the state
itself may not be sued, but that
this
cannot
be
indirectly
accomplished
by
suing
its
8
1160671
officers
or
agents
in
their
official capacity, when a result
favorable to plaintiff would be
directly to affect the financial
status of the state treasury.'
State Docks Comm'n v. Barnes, 225
Ala. 403, 405, 143 So. 581, 582
(1932) (emphasis added); see also
Southall v. Stricos Corp., 275
Ala. 156, 153 So. 2d 234 (1963)."
"'Patterson v. Gladwin Corp., 835 So. 2d
137, 142 (Ala. 2002).'
"Alabama Agric. & Mech. Univ. v. Jones, 895 So. 2d
867, 872-73 (Ala. 2004).
"'Section 14 immunity is not absolute;
there are actions that are not barred by
the general rule of immunity.
"'"[C]ertain
actions
are
not
barred by § 14. There are six
general categories of actions
that do not come within the
prohibition of § 14: (1) actions
brought to compel State officials
to perform their legal duties;
(2) actions brought to enjoin
State officials from enforcing an
unconstitutional law; (3) actions
to compel State officials to
perform ministerial acts; (4)
actions brought against State
officials under the Declaratory
Judgments Act, Ala. Code 1975, §
6-6-220
et
seq.,
seeking
construction of a statute and its
application in a given situation;
(5) valid inverse condemnation
actions brought against State
officials in their representative
9
1160671
capacity; and (6) actions for
injunction or damages brought
against State officials in their
representative
capacity
and
individually where it was alleged
that they had acted fraudulently,
in
bad
faith,
beyond
their
authority,
or
in
a
mistaken
interpretation
of
law.
See
Drummond Co. v. Alabama Dep't of
Transp., 937 So. 2d 56, 58 (Ala.
2006) (quoting Ex parte Carter,
395 So. 2d 65, 68 (Ala. 1980));
Alabama
Dep't
of
Transp. v.
Harbert Int'l, Inc., 990 So. 2d
831 (Ala. 2008) (holding that the
exception
for
declaratory-
judgment actions applies only to
actions against State officials).
As we confirmed in Harbert, these
'exceptions'
to
sovereign
immunity apply only to actions
brought against State officials;
they do not apply to actions
against the State or against
State agencies. See Alabama Dep't
of Transp., 990 So. 2d at 840-
41."
"'Ex parte Alabama Dep't of Fin., 991 So.
2d 1254, 1256-57 (Ala. 2008). The sixth
"exception" to § 14 immunity was restated
in Ex parte Moulton, 116 So. 3d 1119, 1141
(Ala. 2013), as follows:
"'"(6)(a) actions for injunction
brought against State officials
in their representative capacity
where it is alleged that they had
acted fraudulently, in bad faith,
beyond their authority, or in a
mistaken interpretation of law,
10
1160671
Wallace v. Board of Education of
Montgomery County, 280 Ala. 635,
197 So. 2d 428 (1967), and (b)
actions
for
damages
brought
against State officials in their
individual capacity where it is
alleged
that
they
had acted
fraudulently,
in
bad
faith,
beyond their authority, or in a
mistaken interpretation of law,
subject to the limitation that
the action not be, in effect, one
against the State. Phillips v.
Thomas, 555 So. 2d 81, 83 (Ala.
1989)."'
"Ex parte Hampton, 189 So. 3d 14, 17-18 (Ala. 2015).
"'"These actions are sometimes
referred to as 'exceptions' to §
14; however, in actuality these
actions are simply not considered
to
be
actions
'"against
the
State"
for
§
14
purposes.'
Patterson v. Gladwin Corp., 835
So. 2d 137, 142 (Ala. 2002). This
Court
has
qualified
those
'exceptions,' noting that '"[a]n
action is one against the [S]tate
when a favorable result for the
plaintiff would directly affect a
contract or property right of the
State, or would result in the
plaintiff's recovery of money
from
the
[S]tate."'
Alabama
Agric. & Mech. Univ. v. Jones,
895 So. 2d 867, 873 (Ala. 2004)
(quoting Shoals Cmty. Coll. v.
Colagross, 674 So. 2d 1311, 1314
(Ala. Civ. App. 1995)) (emphasis
added in Jones)."
11
1160671
"'Alabama Dep't of Transp. v. Harbert
Int'l, Inc., 990 So. 2d 831, 840 (Ala.
2008).'
"Vandenberg v. Aramark Educ. Servs., Inc., 81 So. 3d
326, 332 (Ala. 2011).
"'"To determine whether an action against
a State officer is, in fact, one against
the State, this Court considers
"'"'whether "a result favorable
to the plaintiff would directly
affect a contract or property
right of the State," Mitchell [v.
Davis, 598 So. 2d 801, 806 (Ala.
1992)], whether the defendant is
simply a "conduit" through which
the plaintiff seeks recovery of
damages from the State, Barnes v.
Dale, 530 So. 2d 770, 784 (Ala.
1988), and whether "a judgment
against
the
officer
would
directly affect the financial
status of the State treasury,"
Lyons [v. River Road Constr.,
Inc.], 858 So. 2d [257] at 261
[(Ala. 2003)].'
"'"Haley [v. Barbour County], 885 So. 2d
[783] at 788 [(Ala. 2004)]. Additionally,
'[i]n
determining
whether
an
action
against
a state officer is barred by § 14, the
Court considers the nature of the suit or
the relief demanded, not the character of
the office of the person against whom the
suit is brought.' Ex parte Carter, 395 So.
2d 65, 67-68 (Ala. 1980)."'
"Ex parte Moulton, 116 So. 3d 1119, 1130-31 (Ala.
2013) (quoting Alabama Dep't of Transp. v. Harbert
Int'l, Inc., 990 So. 2d 831, 839-40 (Ala. 2008))."
12
1160671
Alabama State Univ. v. Danley, 212 So. 3d 112, 122-24 (Ala.
2016).
In the present case, Ingle's claim against the Board
members and Adkins in their official capacities to declare
Adkins's current contract illegal and to enjoin payments under
that contract going forward fits squarely into the sixth
"exception" to § 14 immunity. Specifically, Ingle seeks an
"injunction
...
against
State
officials
in
their
representative capacity where it is allege[d] that they had
acted fraudulently, in bad faith, beyond their authority, or
in a mistaken interpretation of law." Therefore, this claim
is not an action "against the State" for § 14 purposes and is
not barred by § 14 immunity.
Lastly, we must decide whether Ingle has standing to
pursue this claim. Ingle argues that she has private standing
to pursue this claim in her individual capacity as a citizen
and taxpayer and that, if she does not have taxpayer standing,
she has public-interest standing to pursue this claim in the
name of the State.
This Court has stated:
"'To say that a person has standing is to say
that that person is the proper party to bring the
13
1160671
action. To be a proper party, the person must have
a real, tangible legal interest in the subject
matter of the lawsuit.' Doremus v. Business Council
of Alabama Workers' Comp. Self–Insurers Fund, 686
So. 2d 252, 253 (Ala. 1996). 'Standing ... turns on
"whether the party has been injured in fact and
whether the injury is to a legally protected
right."' [State v. Property] at 2018 Rainbow Drive,
740 So. 2d [1025] at 1027 [(Ala. 1999)](quoting
Romer v. Board of County Comm'rs of the County of
Pueblo, 956 P.2d 566, 581 (Colo. 1998) (Kourlis, J.,
dissenting)) (emphasis omitted). In the absence of
such an injury, there is no case or controversy for
a court to consider. Therefore, were a court to make
a binding judgment on an underlying issue in spite
of absence of injury, it would be exceeding the
scope of its authority and intruding into the
province of the Legislature. See City of Daphne v.
City of Spanish Fort, 853 So. 2d 933, 942 (Ala.
2003) ('The power of the judiciary ... is "the power
to declare finally the rights of the parties, in a
particular case or controversy ...."' (quoting Ex
parte Jenkins, 723 So. 2d 649, 656 (Ala. 1998)));
Allen v. Wright, 468 U.S. 737, 752, 104 S. Ct. 3315,
82 L. Ed. 2d 556 (1984) ('[T]he law of Art. III
standing is built on a single basic idea –- the idea
of separation of powers.').
"In Jones v. Black, 48 Ala. 540 (1872), this
Court first articulated a test for determining
whether a party has the necessary standing to
challenge the constitutionality of an act of the
Legislature. We stated then:
"'A party who seeks to have an act of
the legislature declared unconstitutional,
must not only show that he is, or will be
injured by it, but he must also show how
and in what respect he is or will be
injured and prejudiced by it. Injury will
not be presumed; it must be shown.'
14
1160671
"48 Ala. at 543. In Alabama Alcoholic Beverage
Control Board v. Henri–Duval Winery, LLC, 890 So. 2d
70, 74 (Ala. 2003), a party challenged the
constitutionality of Alabama's Native Farm Winery
Act, § 28-6-1 et seq., Ala. Code 1975. In that case,
this
Court
effectively
restated
the
standard
articulated in Jones, using language adopted from
the Supreme Court of the United States:
"'A party establishes standing to
bring
a
challenge
[on
constitutional
grounds]
when
it
demonstrates
the
existence
of
(1)
an
actual,
concrete
and
particularized "injury in fact" –- "an
invasion of a legally protected interest";
(2) a "causal connection between the injury
and the conduct complained of"; and (3) a
likelihood
that
the
injury
will
be
"redressed by a favorable decision." Lujan
v. Defenders of Wildlife, 504 U.S. 555,
560-61 (1992).'
"(Emphasis added.)"
Town of Cedar Bluff v. Citizens Caring for Children, 904 So.
2d 1253, 1256-57 (Ala. 2004) (footnote omitted).
"'When a party without standing purports to commence
an action, the trial court acquires no subject-
matter jurisdiction.' State v. Property at 2018
Rainbow Drive, 740 So. 2d 1025, 1028 (Ala. 1999).
Under such a circumstance, the trial court has 'no
alternative but to dismiss the action.' 740 So. 2d
at 1029."
Ex parte Chemical Waste Mgmt., Inc., 929 So. 2d 1007, 1010
(Ala. 2005).
15
1160671
Concerning whether a person has standing as a citizen and
taxpayer, this Court has recognized that
"[i]t is well settled that a taxpayer, in
certain situations, has standing to challenge a
proposed illegal expenditure by a state official.
See Turnipseed v. Blan, 226 Ala. 549, 552, 148 So.
116, 118 (1933) (recognizing 'the right of a
taxpayer to maintain a suit in equity to restrain an
officer of a city or county from disbursing funds
without
statutory
authority
or
under
an
unconstitutional statute' and holding that the same
right applies in the context of suits in equity
against state officers (emphasis added)); Goode v.
Tyler, 237 Ala. 106, 109, 186 So. 129, 131 (1939)
('[T]his 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.' (emphasis added)); Zeigler v. Baker,
344 So. 2d 761 (Ala. 1977) (upholding an order of
the trial court granting the taxpayer-plaintiff an
injunction enjoining the comptroller, the finance
director, and the treasurer of the State from making
payments from public funds under the authority of an
unconstitutional act)."
Beckerle v. Moore, 909 So. 2d 185, 187 (Ala. 2005).
Further,
"[i]n 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. Court of County Revenues v. Richardson,
252 Ala. 403, 41 So. 2d 749 (1949); Poyner v.
Whiddon, 234 Ala. 168, 174 So. 507 (1937); Thompson
v. Chilton County, 236 Ala. 142, 181 So. 701 (1938);
Travis v. First Nat. Bank of Evergreen, 210 Ala.
620, 98 So. 890 (1924); Reynolds v. Collier, 204
Ala. 38, 85 So. 465 (1920). The right of a taxpayer
16
1160671
to challenge the unlawful disbursement of state
funds likewise is unquestioned. Goode v. Tyler, 237
Ala. 106, 186 So. 129 (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.'); Hall v. Blan, 227 Ala. 64, 148 So. 601
(1933); Turnipseed v. Blan, 226 Ala. 549, 148 So.
116 (1933). The latter two cases dealt with the
constitutionality of disbursements, while Goode
involved expenditures to be made under purported
statutory authority. The Supreme Court of Illinois
wrote to this principle in Fergus v. Russel, 270
Ill. 304, 110 N.E. 130 (1915):
"'We
have
repeatedly
held
that
taxpayers may resort to a court of equity
to prevent the misapplication of public
funds, and that this right is based upon
the taxpayer[s'] equitable ownership of
such funds and their liability to replenish
the public treasury for the deficiency
which
would
be
caused
by
the
misappropriation.'"
Zeigler v. Baker, 344 So. 2d 761, 763-64 (Ala. 1977). "[I]t
is this liability to replenish the public treasury through the
payment of taxes that gives a plaintiff in a taxpayer's action
standing." Broxton v. Siegelman, 861 So. 2d 376, 385 (Ala.
2003).
"This Court is
committed to
the
proposition that
a taxpayer may maintain a bill to prevent a
misappropriation of the county funds. Reynolds,
County Treas., et al. v. Collier, 204 Ala. 38, 85
So. 465 [(1920)]; Potts v. Commissioners' Court of
Conecuh County, 203 Ala. 300, 82 So. 550 [(1919)];
17
1160671
O'Rear v. Sartain, 193 Ala. 275, 69 So. 554, Ann.
Cas. 1918B, 593 [(1915)].
"Borchard in his treatise on Declaratory
Judgments, at p. 597, observes:
"'In most states of the United States,
and
practically
always
in
American
municipalities, a taxpayer is deemed to
have sufficient legal interest to prevent
by injunction the improper or illegal
expenditure
of
public
funds,
without
invoking the actual or pro forma aid of an
attorney general as party plaintiff. A
fortiori, therefore, he has sufficient
interest to request declaratory relief
against such expenditure or activity,
whether in the form of a proposed or signed
contract, or otherwise. ...'"
Thompson v. Chilton Cty., 236 Ala. 142, 144, 181 So. 701, 702-
03 (1938).
Thus, this Court has repeatedly recognized that a
taxpayer has standing to seek an injunction against public
officials to prevent illegal payments from public funds. The
following is Adkins and the Board members' response to Ingle's
assertion that she has a taxpayer standing:
"'Government officials cannot be sued simply
because a person thinks the officials are doing
something wrong; the thing they are doing must
result in "concrete and particularized" and "actual
or imminent" harm to the person seeking judicial
relief.' Ex parte State ex rel. Ala. Policy Inst.,
200 So. 3d 495, 556 (Ala. 2015) (Shaw, J.,
dissenting). The Court explained in Ala. Policy
18
1160671
Inst. that to have standing, '[i]t is generally
insufficient that a plaintiff merely has a general
interest common to all members of the public.' 200
So. 3d at 517 (quoting State ex rel. Cittadine v.
Indiana Dep't of Transp., 790 N.E.2d 978, 983 (Ind.
2003)). Ingle has no greater interest than all other
members of the public in the terms and conditions of
Dr.
Adkins'
service.
Consequently,
she
lacks
standing individually and her claims were properly
dismissed."
Adkins and Board members' brief, at 7.
It is correct that, for over a century, Alabama has
followed the general rule that, to have standing to bring an
action, the plaintiff must have an interest in the outcome of
the action and show that he or she has suffered or imminently
will suffer an injury. See Town of Cedar Bluff, 904 So. 2d at
1256 (recognizing that in 1872 this Court first articulated
that, to have standing, a party must demonstrate an injury).
However, since Alabama first recognized that rule, this Court
has also continually held that taxpayers have standing to seek
an injunction against public officials to prevent illegal
payments from public funds. This standing is based on the
fact that taxpayers have an equitable ownership in the public
funds and will be responsible for replenishing the public
funds if those funds are misappropriated, and, thus, a
taxpayer suffers an injury when public funds are illegally
19
1160671
spent. Therefore, Ingle has standing as a taxpayer to seek an
injunction against Adkins and the Board members in their
official capacities to prevent illegal payments from public
funds. Furthermore, because Ingle has standing to pursue this
claim as a taxpayer, we need not discuss whether she has
public-interest standing to pursue this claim in the name of
the State.
In their briefs on appeal, the parties also set forth
arguments concerning the merits of Ingle's claims. However,
those arguments are not ripe for consideration at this stage
of the litigation, and, thus, we will not consider them at
this time.
Conclusion
Based on the foregoing, this Court reverses the circuit
court's order dismissing Ingle's claims against the Board
members and Adkins in their official capacities alleging that
Adkins's current agreement with the Board is illegal and
seeking to enjoin payments under that agreement going forward,
and we remand the case for proceedings consistent with this
opinion. In all other respects, this Court affirms the
circuit court's order of dismissal.
20
1160671
AFFIRMED IN PART; REVERSED IN PART; AND REMANDED.
Stuart, C.J., and Bolin and Bryan, JJ., concur.
Murdock, J., concurs in the result.
21 | November 9, 2017 |
e7c8163a-3a3f-4e93-8c34-ca655d18ccdc | Charles W. Horn v. Charles H. Dunn and Boyd, Fernambucq, Vincent & Dunn, P.C. | N/A | 1160026 | Alabama | Alabama Supreme Court | REL: November 17, 2017
STATE OF ALABAMA -- JUDICIAL DEPARTMENT
THE SUPREME COURT
OCTOBER TERM, 2017-2018
1160026
Charles W. Horn v. Charles H. Dunn and Boyd, Fernambucq,
Vincent & Dunn, P.C. (Appeal from Shelby Circuit Court:
CV-15-23).
MURDOCK, Justice.
AFFIRMED. NO OPINION.
See Rule 53(a)(1) and (a)(2)(F), Ala. R. App. P.
Stuart, C.J., and Parker, Main, and Bryan, JJ., concur. | November 17, 2017 |
a2095ac3-dac0-4847-9e66-0814327e6f7e | Stanley D. Lawler v. Sam Johnson and City of Birmingham Retirement and Relief System | N/A | 1151347 | Alabama | Alabama Supreme Court | rel: October 20, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
____________________
1151347
____________________
Stanley D. Lawler
v.
Sam Johnson and City of Birmingham Retirement and Relief
System
____________________
1160049
____________________
Clete Walker
v.
Sam Johnson and City of Birmingham Retirement and Relief
System
____________________
1160158
____________________
Georgia Urology, P.A., et al.
v.
Sam Johnson and City of Birmingham Retirement and Relief
System
Appeals from Jefferson Circuit Court
(CV-03-6630)
STUART, Chief Justice.
Stanley D. Lawler; Clete Walker; Georgia Urology, P.A.,
and several of its member physicians (those physicians are
hereinafter referred to collectively with Georgia Urology,
P.A., as "the Georgia Urology claimants"; Lawler, Walker, and
the Georgia Urology claimants are hereinafter referred to
collectively as "the objectors"), filed objections in the
Jefferson Circuit Court challenging a $124 million attorney
fee awarded by the Jefferson Circuit Court to class counsel as
part of the settlement of Johnson v. Caremark Rx, LLC ("the
Caremark class action).1 After the trial court overruled
1Sam Johnson and City of Birmingham Retirement and Relief
System, class representatives, brought the underlying action
for themselves and on behalf of a class of all others who are
2
1151347, 1160049, 1160158
their objections and its judgment approving the settlement
became final, the objectors appealed the attorney fee to this
Court. We vacate the trial court's order awarding attorney
fees and remand the case.
I.
This Court has previously had before it appellate
proceedings arising from the Caremark class action on
multiple
occasions. See, e.g., Ex parte Caremark Rx, LLC, [Ms.
1151160, Feb. 24, 2017] ___ So. 3d ___ (Ala. 2017); CVS
Caremark Corp. v. Lauriello, 175 So. 3d 596 (Ala. 2014); and
Ex parte Caremark RX, Inc., 956 So. 2d 1117 (Ala. 2006).
Although we have described the basic facts of the case on each
of those occasions, we briefly do so again here to provide
context to the instant appeals.
Beginning in approximately 1998, MedPartners, Inc., was
the subject of dozens of securities-fraud lawsuits alleging
that it had made false statements regarding its financial
condition and anticipated future performance. Many of those
lawsuits were eventually consolidated into a class action in
the Jefferson Circuit Court
("the MedPartners class action"),
similarly situated.
3
1151347, 1160049, 1160158
and in 1999 the MedPartners class action was settled for $56
million based on MedPartners' assertions that the negotiated
settlement
exhausted
its
available
insurance coverage
and
that
it possessed limited other assets it could use to pay a larger
award or settlement. Post-settlement, however, it was
revealed in unrelated litigation that MedPartners actually
held an excess-insurance policy providing unlimited coverage
during the period in which the alleged fraud had been
committed. In 2003, the Caremark class action was initiated
against MedPartners' corporate successor, an entity now known
as Caremark Rx, LLC ("Caremark"), and its previous insurer
asserting fraud and suppression claims based on the $56
million settlement agreed to in the MedPartners class action.
Little progress was made toward resolution of the
Caremark class action over the next several years because
disputes
concerning
class
certification,
class
representatives, and which attorneys would act as class
counsel
resulted
in
time-consuming delays
and
multiple
appeals
to this Court. Ultimately, however, Caremark and its insurer
agreed in May 2016 to settle the claims asserted against them
in the Caremark class action for $310 million. The trial
4
1151347, 1160049, 1160158
court subsequently approved the settlement and awarded class
counsel 40% of the settlement fund, or $124 million, as an
attorney fee. The primary issue in these appeals is the size
of the awarded attorney fee; the objectors argue that it is
excessive and amounts to a windfall for class counsel and that
they were given insufficient time and information to properly
object to the size of the attorney-fee award.
In its June 1, 2016, order giving preliminary approval to
the $310 million settlement, the trial court set forth the
terms of the proposed settlement and outlined the procedures
by which class members could file with Gilardi & Co, LLC, the
appointed claims administrator, both proof of claims and any
objections to the proposed settlement. The trial court also
set forth the following relevant deadlines:
June 17, 2016 –– notice of the proposed settlement,
in the forms approved by the trial court, must be
published in the Wall Street Journal and on the
official settlement Web site and mailed to all
identifiable
class
members.
Class
counsel's
attorney-fee application must also be posted on the
settlement Web site.
July 22, 2016, –– written objections to any aspect
of
the
proposed
settlement,
including
class
counsel's
attorney-fee
application,
must
be
delivered to Gilardi; any objectors desiring to
present oral argument regarding their objections
5
1151347, 1160049, 1160158
must also deliver notice of that desire to the trial
court and counsel for all the parties.
July 29, 2016 –– class counsel must file and serve
its
attorney-fee
application
along
with
all
supporting materials.
August 8, 2016 –- trial court to conduct a fairness
hearing to consider fairness, reasonableness, and
adequacy of the proposed settlement.
September 30, 2016 –– class members must deliver
proof of claims to Gilardi.
The trial court also approved the notice form that would be
mailed to class members ("the short-form notice") and the more
detailed notice that would be posted on the settlement Web
site ("the long-form notice").
In accordance with this time line, on or around June 17,
2016, the short-form notice was mailed to identified class
members. Under a header stating "Your right to additional
information
and/or
to
object,"
the
short-form
notice
provided:
"A longer and more detailed notice of the
settlement, which describes additional terms of the
settlement and the procedures applicable to the
settlement,
is
available
at
www.aig-
caremarkclassaction.com. The settlement hearing
will be held on August 8, 2016 at 1:30 p.m. [at the
Jefferson County Courthouse]. ... Any class member
may object to the proposed settlement, the plan of
allocation, or the fee and expense application
and/or incentive awards. A class member may do so
by filing a written objection and/or by appearing at
the settlement hearing and showing cause why the
6
1151347, 1160049, 1160158
court should not approve the proposed settlement,
the plan of allocation, or the fee and expense
application and/or incentive awards. Additional
information regarding objecting to the settlement,
including the requirements for submitting valid
objections,
is
available
at
www.aig-
caremarkclassaction.com."
(Emphasis added.)
Thus, although the trial court's June 1,
2016, order indicated that a class member objecting to the
proposed settlement was required to file a written objection
with Gilardi by July 22, 2016, the short-form notice mailed to
class members informed them that they could object to the
proposed settlement "by filing a written objection and/or by
appearing at the settlement hearing." In this respect, the
language of the short-form notice actually mailed to the class
members differed from the language of the short-form notice
approved by the trial court in conjunction with its June 1,
2016, order; the approved short-form notice provided that "[a]
class member may [object] by filing a written objection and by
appearing at the settlement hearing ...." (Emphasis added.)
Class counsel asserts in one of its briefs filed with this
Court that the language was changed before the short-form
notice was mailed in an attempt to clarify that an objector
7
1151347, 1160049, 1160158
was not required to attend the August 8 fairness hearing in
order to assert an objection.
At approximately this same time, the long-form notice was
posted on the settlement Web site. The long-form notice
provided that, "[a]t the settlement hearing, class counsel
will request the court to award attorneys' fees not to exceed
40% of the settlement amount, plus expenses not to exceed
$3,000,000." On July 22, 2016, Walker and the Georgia Urology
claimants filed their objections to the proposed settlement;
Walker also submitted notice that he intended to appear at the
August 8 fairness hearing. Their objections to the proposed
settlement raised the same general issues –– that they were
given insufficient time and information to properly consider
the settlement and to prepare any objections; that they were
given insufficient time to gather the approximately 20-year-
old records needed to establish their claims; and that a
potential award of attorney fees up to $124 million was
excessive. On July 29, 2016, class counsel filed their
attorney-fee application formally requesting $124 million in
attorney fees, an additional $2,585,933 for expenses, and
$50,000 service awards for each of three current or former
8
1151347, 1160049, 1160158
named plaintiffs; class counsel also filed responses to the
objections made by Walker and the Georgia Urology claimants.
This attorney-fee application had not been previously posted
on the settlement Web site or made available for class members
to review.
On August 5, 2016, Lawler filed an objection to the
proposed settlement; his objection focused solely on class
counsel's requested $124 million attorney fee. Lawler also
filed notice with the trial court that he planned to be
represented at the August 8 fairness hearing. The fairness
hearing was subsequently held as scheduled, and, although
class counsel argued that Lawler's objection was
untimely, the
trial court nevertheless allowed Lawler to present his
argument. Walker also presented argument on his objections at
the hearing, and class counsel argued in response that Walker,
as well as the Georgia Urology claimants, had failed to
establish that they were class members and that their
objections should be overruled on that basis.2 Class counsel
2The trial court's June 1, 2016, order giving preliminary
approval to the proposed settlement and the long-form notice
posted on the settlement Web site stated that all written
objections to the proposed settlement must include proof that
the objector is a member of the class.
9
1151347, 1160049, 1160158
also argued generally that the arguments made by the various
objectors should be rejected on their merits because, they
argued, the schedule set by the trial court provided adequate
notice in all respects and the $124 million attorney-fee award
was warranted.
On August 15, 2016, the trial court entered a number of
orders by which it overruled the objections of Lawler and
Walker, granted in whole class counsel's attorney-fee
application with respect to the requests for an attorney fee,
expenses, and service awards for the named plaintiffs, and
entered a final judgment approving the terms of the $310
million settlement. On September 13, 2016, Walker filed a
motion pursuant to Rule 59(e), Ala. R. Civ. P., asking the
trial court to alter, amend, or vacate its orders overruling
his
objection,
granting
class
counsel's
attorney-fee
application, and entering a final judgment. Thereafter,
Lawler, Walker, and the Georgia Urology claimants, before the
September 30, 2016, deadline, filed claim forms with Gilardi
seeking
to
establish
their
eligibility
to
receive
compensation
from the settlement fund. After that deadline passed,
however, class counsel moved the trial court to review the
10
1151347, 1160049, 1160158
claim forms filed by Walker and the Georgia Urology claimants
to determine whether they had in fact asserted valid claims;
class counsel argued that they had not and urged the trial
court to overrule their objections and Walker's Rule 59(e)
motion on that basis.
Class counsel thereafter also moved the trial court to
enter a new order explicitly finding that Lawler's objection
was untimely. On October 31, 2016, the trial court entered an
order stating that Lawler's objection was both untimely and
without merit and another order holding that the Georgia
Urology claimants had failed to present evidence establishing
either (1) that they were members of the class or (2) that
they had suffered a loss that entitled them to compensation
from the settlement fund. On November 7, 2016, the trial
court entered a similar order holding that the claim forms
submitted by Walker also failed to establish that he was
entitled to any share of the settlement. On November 10,
2016, the trial court denied Walker's Rule 59(e) motion and,
pursuant to a motion jointly filed by the parties seeking to
resolve perceived procedural issues related to its previous
orders, entered a new order restating the terms of its
11
1151347, 1160049, 1160158
previous order awarding class counsel the requested attorney
fee and expenses, as well as providing service awards to the
named plaintiffs.
Out of an abundance of caution, the objectors had all
filed separate notices of appeal to this Court before the
entry of the trial court's November 10 orders, and, pursuant
to Rule 4(a)(5), Ala. R. App. P., those notices of appeal were
held in abeyance while Walker's Rule 59(e) motion was pending.
Following the resolution of that motion, the notices of appeal
became effective, and the appellate process began in earnest.
Because the objectors stipulated that they were not
contesting
the general terms of the settlement agreement, Caremark and
its insurer subsequently transferred the agreed-upon $310
million into a settlement fund. The trial court thereafter
also authorized the disbursement of the awarded attorney fee,
expense reimbursement, and service awards. On December 13,
2016, this Court consolidated Lawler's appeal (no. 1151347),
Walker's appeal (no. 1160049), and the Georgia Urology
claimants' appeal (no. 1160158) for review based on the
similarities of the issues presented.
12
1151347, 1160049, 1160158
II.
In Perdue v. Green, 127 So. 3d 343, 356 (Ala. 2012), this
Court explained the standard of review applicable in appeals
such as these where objectors seek appellate review of a trial
court's judgment approving the settlement of a class action:
"'[T]he standard of review applicable
to a trial court's approval of a proposed
settlement of a class action is as follows:
"'"There
can
be
no
settlement [of a class action]
without
the
trial
court's
approval. Rule 23(e) [Ala. R.
Civ. P.]. Requiring the trial
court's
approval
of
the
settlement protects the class
from
unjust
settlements
or
voluntary dismissals. The burden
is on the proponents of the
settlement to show that it is
fair, adequate, and reasonable.
This Court's standard of review
is to determine whether the trial
court
abused
its
discretion.
Great weight is given to the
trial court's views, because that
court has been 'exposed to the
litigants, and their strategies,
positions, and proofs."
"'Adams v. Robertson, 676 So. 2d 1265,
1272–73 (Ala. 1995) (citations omitted).'
"Disch v. Hicks, 900 So. 2d 399, 404 (Ala. 2004)."
13
1151347, 1160049, 1160158
Thus, we must ultimately determine whether the trial court
exceeded its discretion in ruling adversely to the objectors.
III.
We first consider Lawler's appeal. Lawler argues (1)
that the trial court denied the class due process by requiring
class members to file objections to any requested attorney fee
before the application for such a fee was actually filed and
(2) that the $124 million attorney fee awarded class counsel
is excessive and constitutes a windfall for class counsel.
However,
before
considering
these
arguments, we
first
consider
class counsel's motion to dismiss Lawler's appeal because,
class counsel argues, he lacks the necessary "standing."3
Class counsel first argues that Lawler's appeal –– and, for
that matter, all of these consolidated appeals –– should be
dismissed because Lawler and the other objectors failed to
formally intervene in the proceedings before the trial court.
It is undisputed, class counsel argues, that "one who is not
a party to a cause cannot appeal." Sho-Me Motor Lodges, Inc.
3Class counsel acknowledges this Court's recent caselaw
distinguishing standing from similar concepts such as real
party in interest and failure to state a claim, see, e.g., BAC
Home Loan Servicing, LP, 159 So. 2d 31, 40-47 (Ala. 2013), and
argues that, regardless of the terminology employed, Lawler is
the wrong person to pursue his stated objections.
14
1151347, 1160049, 1160158
v. Jehle-Slauson Constr. Co., 466 So. 2d 83, 88 (Ala. 1985).
See also StillWaters Residential Ass'n, Inc. v. SW Props.,
LLC, 137 So. 3d 931, 932 (Ala. Civ. App. 2013) (explaining
that the failure to intervene precludes an interested
individual or entity from appealing a judgment).
Lawler, however, argues that this Court should follow the
lead of the Supreme Court of the United States, which held in
Devlin v. Scardelletti, 536 U.S. 1, 14 (2002), "that nonnamed
class members ... who have objected in a timely manner to
approval of the settlement at a fairness hearing have the
power to bring an appeal without first intervening." Class
counsel in response has identified caselaw from some states
that have declined to apply Devlin to class actions brought
under the rules of procedure of their states, and they urge
this Court to join that group. See Hernandez v. Restoration
Hardware, Inc., 245 Cal. App. 4th 651, 199 Cal. Rptr. 3d 719
(2016) (dismissing class member's appeal of judgment where
class member did not intervene),4 and City of O'Falloon v.
CenturyLink, Inc., 491 S.W.3d 276 (Mo. Ct. App. 2016)
4We note that the Supreme Court of California has granted
a petition to review the holding in Hernandez. See Hernandez
v. Muller, 372 P.3d 200 (Cal. 2016).
15
1151347, 1160049, 1160158
(questioning standing of appellant that had not intervened in
the trial court). Class counsel also argues that the
rationale of Devlin applies only to classes certified pursuant
to Rule 23(b)(1) or (b)(2), Ala. R. Civ. P., where class
members have no ability to opt out of the class and a judgment
that would bind them, and that Devlin should not apply in the
instant case, which was certified pursuant to Rule 23(b)(3)
and allows class members to opt out if they are unsatisfied
with the terms of a proposed settlement. See Devlin, 536 U.S.
at 10 ("[I]n light of the fact that [the objector] had no
ability to opt out of the settlement, see Fed. Rule Civ. Proc.
23(b)(1), appealing the approval of the settlement is
[objector's] only means of protecting himself from being bound
by a disposition of his rights he finds unacceptable and that
a reviewing court might find legally inadequate."); see also
Barnhill v. Florida Microsoft Anti-Trust Litig., 905 So. 2d
195, 199 (Fla. Dist. Ct. App. 2005) (discussing rationale of
Devlin and concluding that "the [appellants] were not bound by
the terms of the settlement because they had the opportunity
16
1151347, 1160049, 1160158
to opt out. Accordingly, there is no reason to allow them to
appeal without intervening.").5
This Court has not expressly adopted the holding of
Devlin to cases such as the case underlying these appeals,
although, in Perdue, 127 So. 3d at 361, this Court did cite
Devlin for the proposition that objectors can appeal that
aspect of a trial court's judgment approving a settlement that
affects them. Notably, however, Perdue did not involve a
class certified pursuant to Rule 23(b)(3). The United States
Court of Appeals for the Eleventh Circuit, however, recently
considered the applicability of Devlin to class actions in
which the class was certified pursuant to Rule 23(b)(3), Fed.
R. Civ. P., and concluded that the rationale of Devlin still
applied:
"As an initial matter we must decide whether
[the objectors], who are neither named class
representatives nor intervenors, have the power to
bring this appeal. The general rule is 'only
parties to a lawsuit, or those that properly become
parties, may appeal an adverse judgment.' Marino v.
5Rule 23(b), Ala. R. Civ. P., is substantially similar to
Rule 23(b), Fed. R. Civ. P. "Federal cases construing the
Federal Rules of Civil Procedure are persuasive authority in
construing the Alabama Rules of Civil Procedure, which were
patterned after the Federal Rules of Civil Procedure." Ex
parte Novartis Pharms. Corp., 975 So. 2d 297, 300 n. 2 (Ala.
2007).
17
1151347, 1160049, 1160158
Ortiz, 484 U.S. 301, 304 (1988) (per curiam). But
in Devlin v. Scardelletti, 536 U.S. 1 (2002), the
Supreme Court held 'that nonnamed class members ...
who have objected in a timely manner to approval of
the settlement at the fairness hearing have the
power to bring an appeal without first intervening.'
Id. at 14.
"Despite differences between Devlin and this
case,
we
will
apply
Devlin's
rule
to
[the
objectors]. The objector in Devlin was part of a
mandatory class with no opt-out rights certified
under Rule 23(b)(1). See id. at 5, 10–11. The
Supreme Court recognized that because the objector
'had no ability to opt out of the settlement,'
appealing the settlement was his 'only means of
protecting himself from being bound by' its terms.
Id. at 10–11. Here in contrast, the class was
certified under Rule 23(b)(3)[, Fed. R. Civ. P.].
That means [the objectors] could have opted out of
the class. See Amchem Prod., Inc. v. Windsor, 521
U.S. 591, 617 (1997). Nevertheless, persuasive
authority convinces us to apply Devlin's rule here.
That is because 'Devlin is about party status and
one who could cease to be a party is still a party
until opting out.' Nat'l Ass'n of Chain Drug Stores
v. New England Carpenters Health Benefits Fund, 582
F.3d 30, 40 (1st Cir. 2009); accord Poertner v.
Gillette Co., 618 Fed. Appx. 624, 627–28 (11th Cir.
2015) (per curiam) (unpublished); Fidel v. Farley,
534 F.3d 508, 512–13 (6th Cir. 2008); Churchill
Vill., L.L.C. v. Gen. Elec., 361 F.3d 566, 572 (9th
Cir. 2004); In re Integra Realty Res., Inc., 354
F.3d 1246, 1257 (10th Cir. 2004). Therefore, [the
objectors], as objecting class members who did not
opt out of the settlement, may bring this appeal."
Carter v. Forjas Taurus S.A., (No. 16-15277, June 29, 2017)
___ F. App'x ___, ___ (11th Cir. 2017) (not selected for
publication in Federal Reporter). See also National Ass'n of
18
1151347, 1160049, 1160158
Chain Drug Stores v. New England Carpenters Health Benefits
Fund, 582 F.3d 30, 39-40 (1st Cir. 2009) ("[T]he weight of
authority holds that Devlin applies to all class actions.").
We agree with the rationale of Carter and the cases cited in
the excerpt quoted above. "The reality of class action
litigation –– wherein each class member is generally entitled
to only a small damages claim –- necessitates the application
of Devlin to Rule 23(b)(3) class actions." Fidel v. Farley,
534 F.3d 508, 513 (6th Cir. 2008). Accordingly, we explicitly
adopt the holding of Devlin for class actions brought in
Alabama state courts and reject class counsel's argument that
Lawler's and the other objectors' appeals should be dismissed
because the objectors did not first intervene in the trial
court.
Class counsel also argues that Lawler's appeal should be
dismissed because Lawler did not file his objections until
August 5, 2016 –– after the July 22, 2016, deadline set by the
trial court. As the United States Court of Appeals for the
Fifth Circuit recognized in Farber v. Crestwood Midstream
Partners L.P., 863 F.3d 410, 418 (5th Cir. 2017): "Devlin's
specific exception for nonparty objectors is limited to those
19
1151347, 1160049, 1160158
'who have objected in a timely manner.'" (Quoting Devlin, 536
U.S. at 14; emphasis added.) Unlike Farber, however, this is
not a case where the alleged untimely objector admitted
receiving notice of the date written objections were due, but
then consciously decided to continue with a planned two-week
vacation before returning and filing an objection two weeks
after the deadline set by the trial court. 863 F.3d at 415.
Rather, Lawler received a mailed notice informing him that he
could object to the proposed settlement "by filing a written
objection and/or by appearing at the settlement hearing."
Lawler in fact subsequently appeared through counsel at the
settlement hearing and voiced his objection –– just as the
notice he received informed him he could do.
Class counsel argues that it was made clear in court
proceedings, in the long-form notice posted on the settlement
Web site, and in the trial court's June 1, 2016, order giving
preliminary approval to the settlement that any objector was
required to file a written objection by July 22, 2016.
However, although the totality of the information presented on
the settlement Web site might have been more clear with regard
to the intended procedure and deadlines relevant to filing
20
1151347, 1160049, 1160158
objections, we decline to hold Lawler's objection untimely on
that basis. The short-form notice sent to Lawler contained
specific instructions on how to file an objection; after
listing the date, time, and location of the settlement
hearing, that notice instructed Lawler that class members
could make their objections known "by filing a written
objection and/or by appearing at the settlement hearing."
Thus, the short-form notice did not merely contain a general
statement informing class members of their right to file an
objection that would have required them to make further
inquiry to discover the process for doing so; rather, for all
that appears, the notice contained all that information.
Lawler's action in waiting to file an objection until after
the July 22, 2016, deadline set by the trial court was
consistent with the short-form notice he was sent telling him
that he could object to the proposed settlement "by filing a
written objection and/or by appearing at the settlement
hearing."6 This Court has explained that due process is
6Class counsel emphasizes that Lawler never filed an
affidavit or gave testimony regarding what he understood the
short-form notice to mean. However, the necessity for such
evidence is not needed in this case, where the language of the
notice is undisputed and speaks for itself.
21
1151347, 1160049, 1160158
fundamentally about fair play, see, e.g., Industrial Chem. &
Fiberglass Corp. v. Chandler, 547 So. 2d 812, 835 (Ala. 1988)
(on application for rehearing), and it would hardly be fair of
this Court or comport with notions of due process to punish
Lawler for acting in accordance with the notice actually
provided to him.
It is notable, moreover, that the relevant language in
the short-form notice sent to Lawler was not the language
approved by the trial court; rather, it is language that was
unilaterally added to the short-form notice by class counsel.
Although class counsel asserts that they were attempting to
resolve a different perceived ambiguity in the language
approved by the trial court when they added the language, any
ambiguity that was a product of that change should be
construed against class counsel under the doctrine of contra
proferentem. See Jehle-Slauson Constr. Co. v. Hood-Rich
Architects & Consulting Eng'rs, 435 So. 2d 716, 720 (Ala.
1983) (explaining that under the doctrine of contra
proferentem an ambiguity in a writing is construed against the
drafting party responsible for the ambiguity).
We
accordingly
find no merit in class counsel's argument that Lawler's appeal
22
1151347, 1160049, 1160158
should be dismissed on the basis of his allegedly untimely
objection, and, to the extent it overruled Lawler's objections
on that basis, the trial court exceeded its discretion in
doing so.
Having concluded that Lawler's appeal is properly before
this Court, we now turn to the merits of his arguments. He,
and the other objectors as well, argues that the schedule set
by the trial court provided insufficient opportunity for
class
members to object to class counsel's attorney-fee application
because that schedule required them to state their objections
by July 22, 2016, even though class counsel was not required
to file its attorney-fee application, and did not in fact do
so, until July 29, 2016.7 At least four United States Courts
of Appeals have indicated that such a schedule is problematic;
however, their holdings largely relied on the language of Rule
23(h), Fed. R. Civ. P., which has no counterpart in the
7The objectors have also all noted that the trial court's
June 1 order required class counsel to place their attorney-
fee application on the settlement Web site by June 17, but
class counsel failed to do so. Class counsel argues that this
requirement was mistakenly included in the June 1 order and
that the trial court always intended for the attorney-fee
application to be filed and made public on July 29. The trial
court indicated in a hearing conducted to consider Walker's
Rule 59(e) motion that class counsel's position on this point
is correct.
23
1151347, 1160049, 1160158
Alabama Rules of Civil Procedure. See Keil v. Lopez, 862 F.3d
685, 705 (8th Cir. 2017), In re National Football League
Players Concussion Injury Litig., 821 F.3d 410, 446 (3d Cir.
2016), Redman v. RadioShack Corp., 768 F.3d 622, 638 (7th Cir.
2014), and In re Mercury Interactive Corp. Sec. Litig., 618
F.3d 988, 994 (9th Cir. 2010). Rule 23(h), Fed. R. Civ. P.,
provides, in relevant part:
"In a certified class action, the court may award
reasonable attorney's fees and nontaxable costs that
are authorized by law or by the parties' agreement.
The following procedures apply:
"(1) A claim for an award must be made by
motion under Rule 54(d)(2), subject to the
provisions of this subdivision (h), at a
time the court sets. Notice of the motion
must be served on all parties and, for
motions by class counsel, directed to class
members in a reasonable manner.
"(2) A class member, or a party from whom
payment is sought, may object to the
motion."
Even though Alabama's Rule 23 has no equivalent to Federal
Rule 23(h), courts considering whether Federal Rule 23(h) has
been violated have generally recognized that there is a
concomitant due-process issue as well. See, e.g., Mercury,
618 F.3d at 993 ("We hold that the district court abused its
discretion when it erred as a matter of law by misapplying
24
1151347, 1160049, 1160158
Rule 23(h) in setting the objection deadline for class members
on a date before the deadline for lead counsel to file their
fee motion. Moreover, the practice borders on a denial of due
process because it deprives objecting class members of a full
and fair opportunity to contest class counsel's fee
motion.").
Indeed, it would seem that the requirement in Federal Rule
23(h)(2) that class members be given an opportunity to object
to class counsel's request for attorney fees is essentially a
codification of basic due-process principles. As this Court
has explained:
"Procedural due process, as guaranteed by the
Fourteenth
Amendment
to
the
United
States
Constitution and Article I, § 6, of the Alabama
Constitution of 1901, broadly speaking, contemplates
the rudimentary requirements of fair play, which
include a fair and open hearing before a legally
constituted court or other authority, with notice
and the opportunity to present evidence and
argument, representation by counsel, if desired, and
information as to the claims of the opposing party,
with reasonable opportunity to controvert them."
Ex parte Weeks, 611 So. 2d 259, 261 (Ala. 1992) (emphasis
added). See also Mullane v. Central Hanover Bank & Trust Co.,
339 U.S. 306, 314 (1950) ("An elementary and fundamental
requirement of due process in any proceeding which is to be
accorded finality is notice reasonably calculated, under all
25
1151347, 1160049, 1160158
the circumstances, to apprise interested parties of the
pendency of the action and afford them an opportunity to
present their objections." (emphasis added)).
As Ex parte Weeks and Mullane explain, a fundamental
element of due process is allowing parties that will be bound
by a court's decision to have a reasonable opportunity to make
their position and any objections known. As the federal
appellate courts that have rejected the practice of requiring
class members to object to class counsel's attorney-fee
requests before those requests are filed have concluded, that
opportunity is not provided under those circumstances. The
facts in Mercury are particularly similar to the facts in the
instant case. In Mercury, the settlement notice sent to class
members informed class members that class counsel would
request the award of an attorney fee equal to 25% of the
$117.5 million settlement fund, or $29.375 million. 618 F.3d
at 990. Class members were given until September 4, 2008, to
file written objections to any element of the proposed
settlement; two objections to the potential attorney fee were
filed by that date. Id. at 991. Class counsel, however, in
compliance with the schedule set by the trial court, did not
26
1151347, 1160049, 1160158
file its formal application for an attorney fee and supporting
documentation until September 18, 2008. On September 25,
2008, the trial court held a fairness hearing and approved the
requested attorney fee, overruling the two objections that had
been filed. Id. After one of those objectors appealed, the
United States Court of Appeals for the Ninth Circuit held that
the schedule ordered by the trial court was unlawful,
explaining:
"Moore's Federal Practice counsels that '[a]ny
objection deadline set by the court should provide
the eligible parties with an adequate opportunity to
review all of the materials that may have been
submitted in support of the motion and, in an
appropriate case, conduct discovery concerning the
fees request.' 5 Moore's Federal Practice §
23.124[4] (Matthew Bender 3d ed. 2009). Allowing
class members an opportunity thoroughly to examine
counsel's fee motion, inquire into the bases for
various charges and ensure that they are adequately
documented and supported is essential for the
protection of the rights of class members. It also
ensures that the district court, acting as a
fiduciary for the class, is presented with adequate,
and adequately-tested, information to evaluate the
reasonableness of a proposed fee.
"In this case, [the objectors were] denied such
an opportunity. At the time that [their] objections
to the fee request were due, [the objectors] could
make only generalized arguments about the size of
the total fee because they were only provided with
generalized information. [The objectors] could not
provide the court with critiques of the specific
work done by counsel when they were furnished with
27
1151347, 1160049, 1160158
no information of what that work was, how much time
it consumed, and whether and how it contributed to
the benefit of the class.
"During the fee-setting stage of common fund
class action suits such as this one, '[p]laintiffs'
counsel, otherwise a fiduciary for the class, ...
become[s] a claimant against the fund created for
the benefit of the class.' Class Plaintiffs v. City
of Seattle (In re Wash. Pub. Power Supply Sys. Sec.
Litig.), 19 F.3d 1291, 1302 (9th Cir. 1994)
(internal quotation marks omitted). This shift puts
plaintiffs' counsel's understandable interest in
getting paid the most for its work representing the
class at odds with the class' interest in securing
the largest possible recovery for its members.
Because 'the relationship between plaintiffs and
their attorneys turns adversarial at the fee-setting
stage, courts have stressed that when awarding
attorneys' fees from a common fund, the district
court must assume the role of fiduciary for the
class plaintiffs.' Id. As a fiduciary for the
class, the district court must 'act with "a jealous
regard to the rights of those who are interested in
the fund" in determining what a proper fee award
is.' Id. Included in that fiduciary obligation is
the duty to ensure that the class is afforded the
opportunity to represent its own best interests.
When the district court sets a schedule that denies
the class an adequate opportunity to review and
prepare objections to class counsel's completed fee
motion,
it
fails
to
fulfill
its
fiduciary
responsibilities to the class."
Mercury, 618 F.3d at 994-95. The Court of Appeals for the
Ninth Circuit accordingly vacated the order approving the fee
request and remanded the matter to the trial court, which
thereafter issued new notice to class members informing them
28
1151347, 1160049, 1160158
that a renewed motion seeking an award of attorney fees would
be filed by December 14, 2010, that any objections to that
motion were required to be filed by January 13, 2011, and that
a final hearing would be held February 18, 2011. In re
Mercury Interactive Corp. Sec. Litig., (No. 5:05-CV-03395-JF,
March 3, 2011) (N.D. Cal.) (unpublished order).8
Although the Court of Appeals for the Ninth Circuit in
Mercury couched its holding in terms of Federal Rule 23(h),
its logic similarly applies in this case, where class members
were informed on June 17, 2016, that class counsel would seek
an attorney fee of up to 40% of the settlement fund and that
any objections to whatever attorney fee class counsel
ultimately sought had to be filed by July 22, 2016, even
though class counsel was not required to file its actual
attorney-fee application until one week later on July 29,
2016. Class counsel argues that class members were given
notice that class counsel would be requesting an attorney fee
of up to 40% before objections were due; thus, class counsel
argues, class members were not harmed by the schedule because
8On remand, class counsel agreed to lower its requested
attorney fee and the previous objectors withdrew their
objections.
29
1151347, 1160049, 1160158
they could still file timely objections to that expected
request
without
having
seen
the
actual
attorney-fee
application. This argument, however, fails to acknowledge
that potential objectors were limited to making only general
objections under these circumstances. As the United States
Court of Appeals for the Seventh Circuit explained in Redman,
768 F.3d at 638:
"From reading the proposed settlement the objectors
knew that class counsel were likely to ask for $1
million
in
attorneys'
fees,
but
they
were
handicapped in objecting because the details of
class counsel's hours and expenses were submitted
later, with the fee motion, and so they did not have
all the information they needed to justify their
objections. The objectors were also handicapped by
not knowing the rationale that would be offered for
the fee request, a matter of particular significance
in
this
case
because
of
the
invocation
of
administrative
costs
as
a
factor
warranting
increased fees. There was no excuse for permitting
so irregular, indeed unlawful, a procedure."
See also Mercury, 618 F.3d at 994 ("At the time that [their]
objections to the fee request were due, [the objectors] could
make only generalized arguments about the size of the total
fee because they were only provided with generalized
information. [The objectors] could not provide the court with
critiques of the specific work done by counsel when they were
furnished with no information of what that work was, how much
30
1151347, 1160049, 1160158
time it consumed, and whether and how it contributed to the
benefit of the class.").
We agree with the rationales of these courts and,
especially, the conclusion in Redman that this type of
procedure is "irregular [and] indeed unlawful." Redman, 768
F.3d at 638. The class members in this case were not afforded
due process inasmuch as they were not allowed to view,
consider, and respond to class counsel's attorney-fee
application before they were required to file any objections
to that application. See Ex parte Weeks, 611 So. 2d at 261
(holding that due process requires that parties be given
information regarding the claims of an opposing party and a
reasonable
opportunity
to
controvert
them).
It
is
insufficient that class members had an opportunity to file a
general objection to what they anticipated class counsel might
request as an attorney-fee award; principles of due process
require that they have an opportunity to respond to the
attorney-fee application that is actually filed. The long-
form notice in fact promised class members this opportunity
inasmuch as it stated that "[a]ny class member may object to
the proposed settlement, the plan of allocation, the fee and
31
1151347, 1160049, 1160158
expense application and/or incentive awards."9 In authorizing
a schedule requiring class members to object to class
counsel's requested attorney fee before class counsel filed
its attorney-fee application, the trial court acted beyond its
discretion and
violated
the
class
members'
due-process rights.
The trial court's error being established, however, we
must still consider whether that error was harmless. See Rule
45, Ala. R. App. P. ("No judgment may be reversed or set aside
... for error as to any matter of pleading or procedure,
unless in the opinion of the court to which the appeal is
taken or application is made, after an examination of the
entire cause, it should appear that the error complained of
has probably injuriously affected substantial rights of the
parties."), and Keil, 862 F.3d at 705-06 (concluding that
trial court's error in setting the deadline for objections
before the deadline for class counsel to file their fee motion
was harmless under the circumstances). Class counsel, in
9The long-form notice posted on June 17, 2016, also
advised class members that "the fee and expense application,
together with selected pleadings and other settlement-related
documents
may
be
viewed
online
at
www.aig-
caremarkclassaction.com." However, as explained, the fee and
expense application was not actually posted until it was filed
on July 29, 2016.
32
1151347, 1160049, 1160158
fact, has argued that any error in the timing of the filing of
its fee and expense application was harmless because Walker
and the Georgia Urology claimants filed additional motions
with the trial court explaining their objections after class
counsel filed its application, and Walker and Lawler also
presented arguments orally at the August 8 hearing. In
Cassese v. Williams, 503 F. App'x 55, 58 (2d Cir. 2012) (not
selected for publication in Federal Reporter), the United
States Court of Appeals for the Second Circuit declined to
follow the rationale of the Mercury court at least partially
for this reason, explaining:
"In its ... fee motion, class counsel requested fees
and costs in the precise amounts specified in the
settlement
notice
and
divulged
additional
information regarding counsel's billing rates, hours
worked, and tasks performed. Any objectors then had
two weeks to crystallize their objections and
request further information before attending the
fairness hearing. With the objectors here having
availed themselves of those opportunities, we
identify no abuse of discretion or due process
denial in that portion of the district court's
scheduling order relating to the fee motion."
See also Keil, 862 F.3d at 705 (holding that the trial court
erred in closing objections before class counsel's attorney-
fee application was filed but that that error was harmless
because the objectors subsequently had an opportunity to
33
1151347, 1160049, 1160158
respond to the specific arguments contained within class
counsel's fee application).
We decline, however, to find the error in this case
harmless. We first note that the interval between class
counsel's filing of its application for an attorney fee and
the subsequent fairness hearing was only 10 days –– 5 business
days. Although class counsel has cited several published
opinions in which courts have approved of schedules such as
the one being challenged in this case, none of those opinions
involved as short an interval between the time the attorney-
fee application was filed and the settlement hearing as in
this case. See, e.g., CertainTeed Fiber Cement Siding
Litig., 303 F.R.D. 199, 222 (E.D. Pa. 2014) (three weeks), and
Saccoccio v. JP Morgan Chase Bank, N.A., 297 F.R.D. 683, 699
(S.D. Fla. 2014) (two weeks). Like the Keil court, "[w]e do
not purport to decide how much time after the fee motion
deadline is sufficient to provide class members with an
adequate opportunity to object to the motion," 862 F.3d at
705; however, the short interval provided class members in
this case surely borders on what due process requires.
34
1151347, 1160049, 1160158
Additionally, we note that in most of the cases that have
been brought to this Court's attention in which a court has
rejected an objector's arguments concerning a schedule
requiring the objector to object to an attorney-fee
application before that application is actually filed, the
ruling court has noted that the objector ultimately was
provided access to detailed information about the
hours worked
by class counsel, along with descriptions of the specific
tasks class counsel performed during those hours, and then had
at least some opportunity to respond to that information.
See, e.g., Keil, 862 F.3d at 701 (noting that "the hours and
rates submitted by class counsel were reasonable"); Cassese,
503 F. App'x at 58 (noting that class counsel's fee
application
"divulged
additional
information
regarding
counsel's billing rates, hours worked, and tasks performed");
and CertainTeed, 303 F.R.D. at 223 (noting that "[c]lass
counsel have spent over 12,656 hours in prosecuting this case
on behalf of the settlement class"). In this case, however,
the class was never provided such information. Class counsel
stated in its attorney-fee application that the amount of time
it expended on this case was irrelevant or of only minor
35
1151347, 1160049, 1160158
importance, and it repeats that claim on appeal, arguing that
this Court in Edelman & Combs v. Law, 663 So. 2d 957, 959
(Ala. 1995), held that "in a class action where the plaintiff
class prevails and the lawyer's efforts result in a recovery
of a fund, by way of settlement or trial, a reasonable
attorney fee should be determined as a percentage of the
amount agreed upon in settlement or recovered at trial."
However, although it is true that Edelman warns trial courts
against "a strict reliance" on the time-expended factor when
awarding an attorney fee in a common-fund case, 663 So. 2d at
960, it is not accurate to say that Edelman declared the time-
expended factor to be irrelevant in common-fund cases. To the
contrary, Edelman states:
"We hold that the lawyers representing the
plaintiff class in this case are entitled to a
reasonable
percentage
of
the
amount
of
the
settlement. In determining that percentage, the
trial court should consider all relevant factors,
including the number of hours expended on behalf of
the class. Several factors, including the number of
lawyers who were actively engaged for over four
years in the handling of the claims, the complexity
of the litigation, as well as the management
responsibilities inherent in a class action, and the
result obtained, would justify a[n] award of an
amount between 20% and 33 1/3% of the amount of the
settlement. However, the plaintiffs' attorneys did
not introduce any evidence of the actual time spent
on behalf of the class. The trial court should
36
1151347, 1160049, 1160158
consider that factor in determining the appropriate
percentage to be awarded in this case."
663 So. 2d at 961 (emphasis added.)10
Class counsel notes also, however, that the trial court
has stated that it had seen the thousands of hours of time
expended by class counsel over the many years this case has
been pending and that it did not need time sheets to conclude
that the time class counsel spent on the case weighed in favor
of the $124 million award. However, although the trial court
certainly has some personal knowledge of the time expended by
class counsel in this case, Lawler argues that the facts of
this case demand a closer examination of those hours.
Specifically, he argues that much of the time expended by
class counsel in this case, and the corresponding delay in
reaching a final resolution, is due to class counsel's own
missteps and questionable decisions. As examples, Lawler
notes that it was class counsel that was initially "duped" in
the original settlement of the MedPartners class action, that
class counsel's unsuccessful attempt to avoid the class-
certification process, as detailed in Ex parte Caremark RX,
10This Court has listed factors relevant to determining
the reasonableness of attorney fees in Peebles v. Miley, 439
So. 2d 137, 140-41 (Ala. 1983).
37
1151347, 1160049, 1160158
Inc., 956 So. 2d 1117 (Ala. 2006), added years of delay and
additional expenses to the litigation, that much of the other
time expended by class counsel in this case was devoted to
class counsel's efforts defending themselves from attempts to
disqualify them and from other attorneys seeking to replace
them as a result of class counsel's previous decisions, and
that class counsel's efforts of late have been directed toward
avoiding a meaningful review of their requested attorney fee
to the express detriment of the class.
Lawler argues that the time expended on those efforts
cannot be used by class counsel to justify an attorney fee
because, he argues, that time did not benefit the class; class
counsel, however, argues that the $310 million settlement they
ultimately negotiated demonstrates that those efforts all
benefited the class. Without deciding this issue, we agree
with Lawler that the class members are entitled to more
information about the amount of time class counsel expended in
this case and the manner in which that time was spent. As
explained in Edelman, 663 So. 2d at 961, the amount of time
expended on behalf of the class is still a relevant factor
that should be considered when determining a reasonable
38
1151347, 1160049, 1160158
attorney fee in a class-action case. Accordingly, class
members are entitled to basic information in that regard so
they can adequately argue any objections they have, as is
their due-process right. On remand, the trial court should
direct a process whereby that information is provided to the
objectors; the objectors subsequently are provided with
adequate time to restate their objections in light of that
information; and the trial court then considers those
objections and enters a new order awarding an attorney fee.11
Our resolution of this issue obviates the need to conduct our
own review of the reasonableness of the awarded attorney fee
at this time, as well as the need to consider the other issues
raised by Lawler and the other objectors.12
11We further note that the information Lawler and the
other objectors seek regarding the time class counsel has
spent on this case will also better allow this Court to
conduct a "meaningful review," Wehle v. Bradley, 195 So. 3d
928, 946 (Ala. 2015), of the attorney fee awarded on remand if
class counsel and the objectors are unable to resolve their
dispute and a subsequent appeal is necessary.
12Walker and the Georgia Urology claimants have argued in
their
appeals
that
the
trial
court
wrongfully
took
consideration of their claims from Gilardi and
determined that
those claims were not valid. Because we have already
determined that remand is appropriate, we decline to consider
those arguments at this time. Appellate review in a piecemeal
fashion is generally disfavored, Dzwonkowski v. Sonitrol of
Mobile, Inc., 892 So. 2d 354, 363 (Ala. 2004), and Walker and
39
1151347, 1160049, 1160158
IV.
After class counsel negotiated a $310 million settlement
with Caremark and its insurer resolving class members' fraud
and suppression claims stemming from the previous settlement
of the MedPartners class action, the objectors filed notice
with the trial court that they objected to class counsel's
request that 40% of the settlement, or $124 million, be paid
to them as an attorney fee. The trial court thereafter
overruled those objections and entered an order awarding class
counsel the $124 million attorney fee they had requested. The
objectors subsequently separately appealed that award to this
Court, arguing that they had been given insufficient
opportunity to object to class counsel's requested attorney
fee inasmuch as their objections were due before class
counsel's attorney-fee application was filed, and that the
attorney fee ultimately awarded was excessive. We agree with
Lawler's and the other objectors' argument that a schedule
the Georgia Urology claimants can present their arguments
regarding their claims to the trial court again on remand
along with their objections regarding class counsel's
attorney-fee application. Should an issue in that regard
still exist after the trial court enters a new order making an
award of attorney fees, Walker and the Georgia Urology
claimants may argue them on appeal, along with any objections
they have to that new attorney-fee award.
40
1151347, 1160049, 1160158
requiring class members to object to class counsel's attorney-
fee request before any such request is formally made violates
class members' due-process rights. Furthermore, we
agree with
Lawler that the objectors were entitled to more information
from class counsel about the time expended on this case in
order to allow them to properly articulate their objections.
Accordingly, we now vacate the order entered by the trial
court awarding class counsel an attorney fee of $124 million.
On remand, class counsel may file a new attorney-fee
application,
including
more
detailed
information
regarding
the
time expended in this case and how that time was spent. The
objectors shall then be given a reasonable opportunity to
review that application and may, if they still have objections
to class counsel's new application, file those objections with
the trial court. After the trial court considers those
objections and enters a new order making an award of attorney
fees, any party with a grievance may file a new appeal with
this Court.
1151347 –– ORDER VACATED AND CASE REMANDED.
1160049 –– ORDER VACATED AND CASE REMANDED.
1160158 –– ORDER VACATED AND CASE REMANDED.
Shaw, Wise, and Sellers, JJ., concur.
Parker, J., concurs in the result.
41 | October 20, 2017 |
91c53522-9791-4645-8624-5105a9026a60 | Ex parte Charles Quick and Donald Quick. | N/A | 1170072 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
December 8, 2017
1170072
Ex parte Charles Quick and Donald Quick. PETITION FOR WRIT OF CERTIORARI TO THE
COURT OF CIVIL APPEALS (In re: Charles Quick and Donald Quick v. Kerry Privett and KC's
Tree Service) (Cullman Circuit Court: CV-15-900069; Civil Appeals :
2160178).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on December 8, 2017:
Writ Denied. No Opinion. Sellers, J. - Stuart, C.J., and Parker, Shaw, and Wise, JJ.,
concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 8th day of December, 2017.
Clerk, Supreme Court of Alabama | December 8, 2017 |
ce1aeaa0-b00c-4bf6-9246-6d2feea70bcf | Ex parte John Russell Calhoun. | N/A | 1161126 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
November 17, 2017
1161126
Ex parte John Russell Calhoun. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF
CRIMINAL APPEALS (In re: John Russell Calhoun v. State of Alabama) (Talladega Circuit
Court: CC-98-215.60; CC-98-216.60; CC-98-217.60; CC-98-218.60; Criminal Appeals :
CR-14-0779).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on November 17, 2017:
Writ Denied. No Opinion. Parker, J. - Stuart, C.J., and Bolin, Main, Bryan, and Sellers,
JJ., concur. Shaw and Wise, JJ., recuse themselves.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 17th day of November, 2017.
Clerk, Supreme Court of Alabama | November 17, 2017 |
9835395d-47c1-4ff5-b180-81501c77fae9 | Ex parte Clinton Carter | N/A | 1160894 | Alabama | Alabama Supreme Court | REL: November 22, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
____________________
1160894
____________________
Ex parte Alabama Director of Finance Clinton Carter and
Alabama Office of Indigent Defense Services Director Chris
E. Roberts
PETITION FOR WRIT OF MANDAMUS
(In re: Ronald W. Smith and Gerald R. Paulk, individually
and on behalf of all other Alabama lawyers similarly
situated
v.
Clinton Carter, in his official capacity as Director of
Finance of the State of Alabama and Chris E. Roberts, in his
official capacity as Director of the Alabama Office of
Indigent Defense Services)
(Jackson Circuit Court, CV-17-900050)
1160894
SELLERS, Justice.
Clinton Carter, in his official capacity as Director of
Finance of the State of Alabama, and Chris E. Roberts, in his
official capacity as director of the Alabama Office of
Indigent
Defense
Services
(hereinafter
referred
to
collectively as "the State defendants"), petition this Court
for a writ of mandamus directing the Jackson Circuit Court to
transfer the underlying action to Montgomery County, where,
they argue, venue is proper. For the reasons discussed below,
we issue the writ.
Facts
In January 2015, the Jackson Circuit Court, pursuant to
§ 15-12-21, Ala. Code 1975,1 appointed Alabama attorneys
1Section
15-12-21
details
Alabama's
system
for
compensating attorneys appointed in indigent cases. At the
time pertinent to this petition, that section provided, in
pertinent part:
"(d) ... [A]ppointed counsel shall be entitled
to receive for their services a fee to be approved
by the trial court. The amount of the fee shall be
based on the number of hours spent by the attorney
in working on the case. The amount of the fee shall
be based on the number of hours spent by the
attorney in working on the case and shall be
computed at the rate of seventy dollars ($70) per
hour for time reasonably expended on the case. The
total fees paid to any one attorney in any one case,
from the time of appointment through the trial of
2
1160894
Ronald W. Smith and Gerald R. Paulk to represent Barry Van
Whitton, an indigent, in a noncapital-murder case. While the
the case, including motions for new trial, shall not
exceed the following:
"(1) In cases where the original
charge is a capital offense or a charge
which carries a possible sentence of life
without parole, there shall be no limit on
the total fee.
"(2) Except for cases covered by
subdivision
(1), in cases where the
original charge is a Class A felony, the
total fee shall not exceed four thousand
dollars ($4,000).
"....
"Counsel shall also
be
entitled to
be
reimbursed
for any nonoverhead expenses reasonably incurred in
the representation of his or her client, with any
expense in excess of three hundred dollars ($300)
subject to advance approval by the trial court as
necessary for the indigent defense services and as
a reasonable cost or expense. Reimbursable expenses
shall not include overhead expenses. Fees and
expenses of all experts, investigators, and others
rendering indigent defense services to be used by
counsel for an indigent defendant shall be approved
in advance by the trial court as necessary for the
indigent defense services and as a reasonable cost
or expense. Retrials of any case shall be considered
a new case for billing purposes. Upon review, the
director may authorize interim payment of the
attorney fees or expenses, or both."
Section 15-12-21 was amended effective January 30, 2016. See
Act No. 215-185, Ala. Acts 2015. The quoted provisions were
not changed by the amendment.
3
1160894
criminal case against Whitton was pending, Smith and Paulk
filed a motion seeking a declaration that § 15-12-21 was
unconstitutional; an order allowing them to exceed the
statutory fee cap set in § 15-12-21; and, in the alternative,
an order reimbursing them for their overhead expenses incurred
in the defense of the case. The trial court conducted a
hearing on the motion; two assistant attorneys general were
present at the hearing.
On September 9, 2015, the trial court entered an order,
which,
among
other
things,
declared
§
15-12-21
unconstitutional and "no longer of any force or effect" ("the
Whitton order). The attorney general did not appeal the
Whitton order or otherwise challenge it.
Upon completion of the criminal trial, the trial court
approved Smith's and Paulk's attorney-fee declarations, i.e.,
$15,995.01 and $28,596.21, respectively. Smith and Paulk
submitted to the Office of Indigent Defense Services ("the
OIDS") the approved attorney-fee declarations, along with a
copy of the Whitton order. The OIDS paid Smith and Paulk only
those amounts authorized by § 15-12-21, citing the statute as
the basis for its limited payment. Smith and Paulk filed a
4
1160894
claim with the State Board of Adjustment, which was
unsuccessful.
On March 13, 2017, Smith and Paulk, individually, and on
behalf of all similarly situated Alabama lawyers, filed a
complaint in the Jackson Circuit Court against the State
defendants in their official capacities. Count one of the
complaint sought mandamus and/or injunctive relief directing
the State defendants to perform their legal and ministerial
duties pursuant to the Whitton order. Counts two and three of
the complaint sought retroactive (dating back to June 14,
2011) and prospective relief for a state-wide class of
similarly situated indigent-defense lawyers.
On April 19, 2017, the State defendants moved the Jackson
Circuit Court for a change of venue to Montgomery County,
citing Tri–State Corp. v. State ex rel. Gallion, 272 Ala. 41,
46, 128 So. 2d 505, 509 (1961)(stating that "it is well
established ... that suits involving public officials are
properly maintained in the county of their official
residence"), and Ex parte Neely, 653 So. 2d 945, 946 (Ala.
1995)(holding that "where an officer of the state is a
defendant ..., venue is proper only in [the county of the
5
1160894
defendant's official residence], 'absent specific statutory
authority to the contrary or waiver of objection to venue'"
(quoting Ex parte City of Birmingham, 507 So. 2d 471, 474
(Ala. 1987))). Smith and Paulk argued in opposition to the
motion for a change of venue that the attorney general, by
failing to challenge the Whitton order declaring § 15-12-21
unconstitutional, waived objections to venue and that that
"waiver" is binding on the State defendants. Smith and Paulk
also argued that the Jackson Circuit Court had continuing and
ancillary jurisdiction to enforce the Whitton order.
On June 27, 2017, the trial court entered an order
denying the State defendants' motion for a change of venue.
The State defendants filed this petition for a writ of
mandamus asking this Court to direct the trial court to vacate
its order denying their motion for a change of venue and to
transfer the case to Montgomery County. This Court ordered
answer and briefs.
Standard of Review
"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
6
1160894
(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)."
Ex parte National Sec. Ins. Co., 727 So. 2d 788, 789 (Ala.
1998).
Analysis
In Ex parte Neely, this Court held that, "absent
statutory authority to the contrary, venue for ... actions
against a state agency or a state officer should be in the
county of the official residence of the agency or officer."
653 So. 2d at 947. In Neely, this Court expressed the public-
policy considerations behind this rule as being "directed
toward preventing inconvenience, hindrance, and delay to the
successful conduct of the functions of state government." 653
So. 2d at 947. In denying the motion to transfer the case, the
trial court concluded that the attorney general, by failing to
7
1160894
challenge the Whitton order, had waived any objections to
venue in Jackson County, that the attorney general's actions
were binding on the State defendants, and that the trial court
had continuing or ancillary jurisdiction to enforce the
Whitton order:
"1. This action seeks enforcement of the
[Whitton order] holding [the fee caps of § 15-12-21]
for indigent defense unconstitutional. This Court
took up that issue as a pre-trial matter in [the
Whitton criminal proceeding], and the Attorney
General did not object to jurisdiction, service or
venue before or after the hearing and trial. There
was no motion to vacate, no mandamus petition, and
no appeal of [the Whitton order].
"2.
As
Alabama's chief law
enforcement officer,
the Attorney General was entitled [to] waive the
objections now raised by [the State defendants]
here, and his election to do so then is binding now
on subordinate officials whose actions are mandated
by the result.
"3. [The State defendants] here are officials
who have only a ministerial duty to pay the fees
ordered [by the Whitton order]. They may not re-
litigate the fee cap issue or second-guess that
decision, and the Attorney General may not now re-
litigate it through [the State defendants] in this
action. ...
"Accordingly, [the State defendants] here have
no substantive issues to contest, and this Court has
continuing or ancillary jurisdiction to enforce [the
Whitton order] by mandamus or injunctive orders
directed to them as ministerial officials."
(Emphasis added.)
8
1160894
The State defendants argue that the trial court exceeded
its discretion in failing to transfer the instant civil action
to Montgomery County because, they say, the
attorney general's
failure to challenge the Whitton order did not operate to
"waive" their objections to venue in this case. Specifically,
the State defendants assert that, although the attorney
general may possess broad power to direct the State's
interests in litigation, he cannot "waive" objections to
venue
for individuals who were not parties to the case in which the
attorney general waived venue and who were not represented by
him or his office at that time. The State defendants further
argue that the trial court's refusal to transfer the action to
Montgomery County was based on its assumption that the Whitton
order was conclusively valid and thus binding on the State
defendants. According to the State defendants, issues
concerning the validity of the Whitton order and its
applicability are disputed and have not yet been decided. For
these reasons, the State defendants maintain that Smith and
Paulk must litigate the merits of their claims against the
State
defendants
in
the
proper
venue--Montgomery County;
Smith
and Paulk, the State defendants maintain, cannot obtain their
9
1160894
desired result merely by pursuing enforcement of the Whitton
order.2 We agree.
The Whitton order declaring § 15-12-21 unconstitutional
was entered by the trial court in a criminal proceeding.
Venue in the criminal proceeding was undisputedly proper in
Jackson County. Smith and Paulk sought to enforce their
alleged rights under Whitton order by submitting their
attorney-fee declarations to the OIDS and, when the OIDS did
not pay the entire amounts submitted, by filing a claim with
the State Board of Adjustment. Having no success with the
Board of Adjustment, Smith and Paulk commenced the underlying
civil action in an effort to force the State defendants to
perform what Smith and Paulk assert are their official duties.
The civil action is distinct from the criminal proceeding, and
there has been no waiver of venue in the civil action.
As the State defendants correctly note, the issue
presented in this petition does not concern the validity of
the Whitton order or whether that order is enforceable.
Rather, the only issue presented for our review is whether
2We note again that Smith and Paulk seek not only to
enforce the Whitton order via this civil action, but also
additional retroactive and prospective relief on behalf of a
class of allegedly similarly situated lawyers.
10
1160894
venue for the civil action is proper in Montgomery County.
The civil action has been brought against the State defendants
in their official capacities, and there has been no waiver of
objections to venue in the civil action. Thus, under this
Court's holding in Ex parte Neely, we conclude that the State
defendants have demonstrated a clear legal right to the relief
sought.
Conclusion
The Jackson Circuit Court is directed to vacate its June
27, 2017, order denying the State defendants' motion for a
change of venue and to transfer the case to the Montgomery
Circuit Court.
PETITION GRANTED; WRIT ISSUED.
Stuart, C.J., and Bolin, Parker, Wise, and Bryan, JJ.,
concur.
Murdock and Shaw, JJ., concur in the result.
11
1160894
MURDOCK, Justice (concurring in the result).
The September 9, 2015, judgment of the Jackson Circuit
Court in the criminal case involving Barry Van Whitton, i.e.,
the Whitton order, awarding attorney fees to Ronald W. Smith
and Gerald R. Paulk ("the attorneys") in excess of the maximum
amount stated in § 15-12-21(d)(2), Ala. Code 1975, not having
been appealed by the attorney general on behalf of the State
of Alabama, constituted a final disposition of the issue
whether the attorneys were entitled to the fee award stated
therein. Under this circumstance, I question whether it was
necessary for the attorneys to have filed some new and
separate action to enforce a judgment already obtained.
Rather than joining in the Jackson Circuit Court proceeding
any additional State officials whose presence might be
necessary for the enforcement of that court's judgment and
seeking enforcement of that judgment by the court that entered
it, however, the attorneys chose to initiate a collateral
lawsuit for that purpose and for the purpose of seeking
additional relief on behalf of a class of similarly situated
indigent-defense lawyers. If such a lawsuit is to be filed,
then I suppose the proper venue for the new lawsuit, naming as
12
1160894
defendants Clinton Carter, in his official capacity as
Director of Finance of the State of Alabama, and Chris E.
Roberts, in his official capacity as director of the Alabama
Office of Indigent Defense Services, is Montgomery County
pursuant to Ex parte Neely, 653 So. 2d 945, 946 (Ala. 1995).
In any event, the finality of the judgment awarding fees to
the attorneys in the Whitton criminal case would appear to be
res judicata as to the specific attorney-fee claims of Smith
and Paulk.3
3In other words, I disagree with the main opinion when it
states that "[w]e agree" with the State's assertion "that
Smith and Paulk must litigate the merits of their claims
against the State defendants in the proper venue -- Montgomery
County; Smith and Paulk ... cannot obtain their desired result
merely by pursuing enforcement of the Whitton order." ___ So.
3d at ___. The merits of the attorneys' individual claims
against the State have already been litigated in the proper
venue -- Jackson County. Indeed, no court other than the
Jackson Circuit Court had authority to litigate the merits of
the attorneys' claims.
13
1160894
SHAW, Justice (concurring in the result).
Generally, the proper venue in a criminal case "is in the
county in which the offense was committed." § 15-2-2, Ala.
Code 1975. The proper venue in the criminal case involving
Barry Van Whitton was Jackson County. Ex parte Neely, 653 So.
2d 945, 946 (Ala. 1995), states: "where an officer of the
state is a defendant ... or where an agency of the state is a
defendant, venue is proper only in Montgomery County." No
officer of the State or State agency was a defendant in the
Whitton criminal case. The rule in Ex parte Neely does not
apply.
"A waiver consists of a 'voluntary and intentional
surrender or relinquishment of a known right ....'" Bentley
Sys., Inc. v. Intergraph Corp., 922 So. 2d 61, 93 (Ala. 2005)
(quoting Dominex, Inc. v. Key, 456 So. 2d 1047, 1058 (Ala.
1984)). Because the rule in Ex parte Neely did not apply in
the Whitton criminal case, it did not provide a right that was
capable of being waived.
14 | November 22, 2017 |
151be4a6-3fd9-4d97-8e40-7657af4078f6 | Ex parte The Maintenance Group, Inc. | N/A | 1160914 | Alabama | Alabama Supreme Court | Rel: November 22, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
____________________
1160914
____________________
Ex parte The Maintenance Group, Inc.
PETITION FOR WRIT OF MANDAMUS
(In re: MARC Transport LLC
v.
The Aviation Department, LLC, et al.)
(Madison Circuit Court, CV-15-901973)
MAIN, Justice.
The Maintenance Group, Inc. ("Maintenance"), petitions
this Court for a writ of mandamus directing the Madison
1160914
Circuit Court to enter an order dismissing the claims against
it based on lack of personal jurisdiction. We grant the
petition and issue the writ.
I. Factual Background and Procedural History
This case arises from the sale of an aircraft. In
February 2014, MARC Transport LLC ("MARC"), a Delaware
limited-liability company
with
its
principal
place
of
business
in Georgia, entered into an agreement to purchase a Hawker
Beechjet aircraft ("the aircraft") from Pelican Bay Equipment
Leasing, LLC ("Pelican Bay"), a Nevada limited-liability
company with its principal place of business in Florida. MARC
was assisted in its purchase of the aircraft by The Aviation
Department, LLC ("TAD"), a Delaware limited-liability company
with its principal place of business in Georgia, and TAD's
principal, Timothy Fitch, a resident of Georgia. TAD is an
aircraft-management and flight-services company, and TAD and
MARC had entered into an agreement pursuant to which TAD was
to supply the maintenance, pilot services, flight scheduling,
and storage of an aircraft once one was purchased by MARC.
TAD and Fitch located the aircraft in Fort Myers, Florida, and
undertook to broker the purchase of the aircraft on MARC's
2
1160914
behalf.
Pelican
Bay
retained
JetBrokers,
Inc.
("JetBrokers"),
a Nevada corporation, to represent it in the sale of the
aircraft.
The purchase agreement gave MARC the right to conduct a
pre-purchase inspection of the aircraft, which the parties
agreed would be performed by Maintenance at its facility in
Georgia. The inspection identified a list of maintenance
issues, known in the industry as "discrepancies."
Maintenance
estimated that it would cost approximately $170,000 to
correct
all the discrepancies. Pelican Bay agreed to correct the
discrepancies.
The purchase of the aircraft was closed on March 27,
2014, in Delaware. Pelican Bay flew the aircraft from Florida
to Delaware for delivery. Fitch accepted delivery in Delaware
on MARC's behalf and flew the aircraft to Georgia. Fitch and
TAD then arranged for the aircraft to fly to Huntsville,
Alabama, to transport MARC's officers as the first passengers
following the purchase of the aircraft. The aircraft has been
routinely flown to and from Huntsville since its purchase.
On November 4, 2015, MARC sued Maintenance, TAD, Fitch,
and Pelican Bay in the Madison Circuit Court. The lawsuit
3
1160914
alleged that the discrepancies discovered in the pre-purchase
inspection had not been corrected by Pelican Bay before
closing. MARC asserted claims of breach of contract against
TAD and Pelican Bay and asserted claims of negligence, fraud,
and civil conspiracy against all defendants. The complaint
included the following specific factual allegations:
"9. In or around October of 2013, MARC’s
affiliate eLab Consulting Services Inc. ('eLab')
entered into a business relationship with Fitch
and/or TAD, to provide charter aircraft services.
"10. Beginning in or around October of 2013,
Fitch and/or TAD provided charter aircraft services
to eLab, primarily utilizing a Hawker Beechjet
aircraft, and many flights were coordinated between
Huntsville, Alabama and Atlanta, Georgia due to the
business operations of eLab and its affiliated
entities.
"11. On or about December 13, 2013, eLab formed
MARC for the purpose of acquiring an aircraft. At
the time of this pleading, MARC is a wholly-owned
subsidiary of eLab.
"12. In or around December of 2013, Fitch
and/or TAD attempted to negotiate the sale of a
Hawker Beechjet aircraft previously chartered by
eLab for acquisition by MARC; however, the parties
were ultimately unable to reach agreement on the
terms of sale for the aircraft.
"13. Thereafter, Fitch and/or TAD undertook to
locate
another
Hawker
Beechjet
aircraft
for
acquisition by MARC.
4
1160914
"14. Effective January 1, 2014, TAD and MARC
entered into an Aircraft Maintenance Agreement,
providing for the management of MARC’s aircraft by
TAD, including maintenance, pilot services, flight
scheduling, and storage of the aircraft, among other
aviation services.
"15. On or about February 6, 2014, Fitch and/or
TAD located the subject N848TC [the aircraft] for
possible acquisition by MARC. As of February 6,
2014, [the aircraft] was owned and operated by
Pelican Bay and was purportedly based at the Page
Field airport ... in Fort Myers, Florida.
"16. Upon information and belief, Pelican Bay
retained JetBrokers to represent it in the sale of
[the aircraft].
"17. On or about February 10, 2014, Fitch,
acting under the instruction, and/or on behalf, of
MARC, contacted JetBrokers with the intent to
negotiate the sale of [the aircraft] and provided a
draft Aircraft Purchase Agreement and proposed
purchase price.
"18. On or about February 11, 2014, JetBrokers
responded to MARC's initial proposal and provided
Fitch with a written acceptance of the proposed
purchase price and a listing of requested revisions
for the draft Aircraft Purchase Agreement.
"19. On or about February 14, 2014, MARC and
Pelican Bay executed the final Aircraft Purchase
Agreement (the 'Agreement'). ... The terms of the
Agreement included a sales price of $800,000 and
upon payment of an escrow amount of $100,000, gave
MARC the right to have [the aircraft] inspected by
an aircraft maintenance organization agreed upon by
both parties and listed in the Agreement.
"20. On or about February 14, 2014, MARC,
through its parent corporation eLab, tendered the
5
1160914
payment of $100,000 in escrow per the terms of the
Agreement.
"21. During the course of negotiations of the
Agreement, Fitch and/or TAD recommended that MARC
retain [Maintenance] to perform the pre-purchase
aircraft inspection per the terms of the Agreement.
As a result, [Maintenance] was listed in the
Agreement as the entity which would conduct the
pre-purchase inspection.
"22. MARC agreed to a payment of $19,000 for
[Maintenance] to perform the pre-purchase aircraft
inspection pursuant to the terms of the Agreement.
TAD later included this $19,000 amount in an invoice
dated April 1, 2014 to MARC through its parent
corporation
eLab,
noting
that
it
was
for
[Maintenance]'s performance of the pre-purchase
aircraft inspection.
"23. Upon information and belief, as of
February
14,
2014,
[Maintenance]
was
an
FAA-certified Repair Station and employed aircraft
mechanics holding an FAA Airframe & Powerplant (A&P)
certificate.
"24. On or about February 16, 2014, Fitch
and/or TAD arranged for the transport of [the
aircraft] from Fort Myers, Florida to the Peachtree-
De[K]alb airport in Chamblee, Georgia ... to
facilitate the pre-purchase aircraft inspection by
[Maintenance].
"25.
On
or
about
February
17,
2014,
[Maintenance] undertook to perform the pre-purchase
aircraft inspection, and thereafter on February 27,
2014, provided Fitch with a pre-closing aircraft
inspection
report
regarding
[the
aircraft],
including a list of maintenance issues known in the
industry as 'discrepancies' ('Discrepancies'). A
copy of the pre-closing aircraft inspection report
(the 'Pre-Closing Inspection Report') is attached
6
1160914
hereto as Exhibit 2, and incorporated herein by
reference.
The
Pre-Closing
Inspection
Report
detailed approximately 49 Discrepancies, 41 of which
are listed as affecting the FAA airworthiness status
of the aircraft. The repair or replacement parts
listed for correction of the Discrepancies were
either required to maintain FAA airworthiness or
recommended pursuant to the aircraft maintenance
manual
and
accepted
industry
practices.
[Maintenance] estimated the cost to correct all
Discrepancies in the Pre-Closing Inspection Report
to be approximately $170,000.00.
"26. Fitch advised MARC of the Pre-Closing
Inspection Report and the estimated cost of
$170,000.00 for repairs and replacements. Based upon
the number of Discrepancies and cost to correct
them, MARC instructed Fitch to advise Pelican Bay of
the Discrepancies, and to propose a discount of the
total sales price by the estimated $170,000.00 cost.
"27. Fitch communicated MARC's proposal to
discount the total sales price by the estimated
$170,000.00 cost to correct the Discrepancies to
JetBrokers, who purportedly advised Pelican Bay.
"28. On March 4, 2014, Fitch advised MARC that
Pelican Bay was unwilling to discount the sales
price by the estimated $170,000.00 cost to correct
the Discrepancies, but was willing to correct all
the items in the Pre-Closing Inspection Report prior
to closing.
"29. In addition, the Agreement provided that
Pelican Bay would be responsible for correcting
airworthiness issues identified in the pre-closing
aircraft inspection. As a result, each of the
Discrepancies affecting FAA airworthiness were again
listed as being the responsibility of Pelican Bay in
the Agreement’s Appendix B 'Preliminary Acceptance
Certificate' signed and initialed by both parties on
March 4, 2014. ...
7
1160914
"30. Based upon Fitch's affirmative statements
to MARC that Pelican Bay was willing to correct all
the
noted
Discrepancies
in
the
Pre-Closing
Inspection Report prior to closing, and that the
maintenance required would take approximately ten
(10) days to complete, MARC agreed to proceed with
the
acquisition
of
[the
aircraft],
including
arranging for secured financing for the acquisition.
"31. Based upon statements by Fitch that the
maintenance regarding all noted Discrepancies in the
Pre-Closing Inspection Report had been completed,
MARC proceeded with closing and consummating the
acquisition of [the aircraft] on March 27, 2014,
including closing of secured financing for the
aircraft through an FDIC-insured commercial bank.
"32. Pelican Bay agreed to make delivery of the
[aircraft] in Delaware and arranged for [the
aircraft] to be flown to Delaware on March 27, 2014,
for delivery to MARC. Thereafter Fitch advised MARC
that he had taken delivery of [the aircraft] from
Pelican Bay in Delaware as agreed, and had returned
to Georgia with full right, title, interest and
possession of [the aircraft] on behalf of MARC.
"33. On March 29, 2014, Fitch and TAD arranged
for [the aircraft] to fly to Huntsville, Madison
County, Alabama, to transport officers of MARC as
the first passengers on [the aircraft] following
MARC's acquisition.
"34. Contrary to express representation by
Fitch to MARC, as of March 29, 2014, some of the
Discrepancies, many of which are listed as affecting
the FAA airworthiness status of the aircraft and
the remainder of which are recommended for repair or
replacement pursuant to the aircraft maintenance
manual and accepted industry practices, had not been
corrected. Despite this fact, Fitch and TAD flew
[the aircraft] to Huntsville, Madison County,
8
1160914
Alabama, to transport officers of MARC in [the
aircraft].
"35. As of March 27 and 29, 2014, Fitch, TAD,
[Maintenance], and Pelican Bay knew that some of the
Discrepancies, many of which are listed as affecting
the FAA airworthiness status of the aircraft and the
remainder of which are recommended for repair or
replacement pursuant to the aircraft maintenance
manual and accepted industry practices, had not been
repaired or otherwise corrected.
"36.
Despite
express
knowledge
that
the
Discrepancies, many of which are listed as affecting
the FAA airworthiness status of the aircraft and the
remainder of which are recommended for repair or
replacement pursuant to the aircraft maintenance
manual and accepted industry practices, had not been
corrected
for
[the
aircraft],
Fitch,
TAD,
[Maintenance], and Pelican Bay knowingly suppressed
or misrepresented such material facts to MARC, and
MARC's passengers in [the aircraft].
"37. Since March 29, 2014, Fitch and TAD have
reportedly and routinely provided flight services
into and out of Madison County, Alabama, under TAD's
management and control, including the scheduling of
flights and engagement of pilots to operate [the
aircraft],
for
the
purpose
of
transporting
passengers who reside in Madison County, Alabama.
"38. Since March 29, 2014, Fitch and TAD have
repeatedly and routinely provided flight services
into and out of Madison County, Alabama, using [the
aircraft], with the express knowledge that the
Discrepancies, many of which are listed as affecting
the FAA airworthiness status of the aircraft and the
remainder of which are recommended for repair or
replacement pursuant to the aircraft maintenance
manual and accepted industry practices, had not been
corrected for [the aircraft].
9
1160914
"39. Further, since March 29, 2014, Fitch and
TAD have repeatedly and routinely conducted the
transport of passengers into and out of Madison
County,
Alabama,
using
[the
aircraft],
while
actively suppressing or otherwise misrepresenting
that the Discrepancies, many of which are listed as
affecting the FAA airworthiness status of the
aircraft and the remainder of which are recommended
for repair or replacement pursuant to the aircraft
maintenance manual and accepted industry practices,
had not been corrected for [the aircraft].
"40. On several occasions since March 27, 2014,
Fitch and TAD have represented to MARC that [the
aircraft] has undergone additional and supplemental
aircraft inspections, maintenance and repairs, and
have charged MARC for such services purportedly
conducted by [Maintenance]. In doing so, Fitch,
TAD,
and
[Maintenance]
continued
to
actively
suppress and affirmatively misrepresent that the
Discrepancies, many of which are listed as affecting
the FAA airworthiness status of the aircraft and the
remainder of which are recommended for repair or
replacement pursuant to the aircraft maintenance
manual and accepted industry practices, had not been
corrected for [the aircraft] prior to the March 27,
2014, closing, or since that time until the date of
this pleading.
"41. During the course of the ongoing
suppression and active misrepresentations regarding
the Discrepancies of [the aircraft], Fitch, TAD, and
[Maintenance] have repeatedly and routinely arranged
or facilitated the transport of passengers into and
out of Madison County, Alabama, using [the aircraft]
at increased risk to said passengers and MARC.
"42. Upon information and belief, Fitch and TAD
became aware of the Discrepancies, many of which are
listed as affecting the FAA airworthiness status of
the aircraft and the remainder of which are
recommended for repair or replacement pursuant to
10
1160914
the
aircraft
maintenance
manual
and
accepted
industry practices, and conspired with [Maintenance]
and/or Pelican Bay to actively suppress the
non-repair of such Discrepancies from MARC. This
suppression was done with the intent to induce MARC
to close on the acquisition of [the aircraft], to
the financial benefit of Fitch, TAD, [Maintenance],
and Pelican Bay.
"43. Upon information and belief, Fitch, TAD,
[Maintenance],
and
Pelican
Bay
determined
to
knowingly
suppress
the
non-repair
of
the
Discrepancies, many of which are listed as affecting
the FAA airworthiness status of the aircraft and the
remainder of which are recommended for repair or
replacement pursuant to the aircraft maintenance
manual and accepted industry practices, despite the
known
risks
resulting
from
such
material
Discrepancies.
"44. Upon information und belief, Fitch, TAD,
[Maintenance], and Pelican Bay, acting in concert
with each other, wrongfully represented to MARC that
all noted Discrepancies, whether required for FAA
airworthiness or recommended based upon the aircraft
maintenance manual or accepted industry practices,
had been repaired prior to the March 27, 2014,
closing by Pelican Bay, and continued to perpetuate
MARC's reliance upon such representations.
"...."
On March 10, 2016, Maintenance moved to dismiss the
claims against it based on lack of personal jurisdiction. In
support of its motion, Maintenance attached the affidavit of
its president and chief executive officer, Dan Furlong, who
testified to Maintenance's lack of contacts with Alabama.
11
1160914
Regarding Maintenance's work performed on the aircraft,
Furlong's affidavit stated:
"[Maintenance]
performed
in
Georgia
the
inspection and servicing of the aircraft at the
request of Defendants Timothy Fitch and [TAD] and
Plaintiff [MARC], the purchaser of the airplane.
The inspection and service work was requested by the
aforementioned Defendants and Plaintiff, all of whom
are domiciled or based in the metropolitan area of
Atlanta,
Georgia.
All
work
performed
by
[Maintenance] with respect to the airplane in
question was performed at [Maintenance]'s place of
business at 1961 Sixth Street, Atlanta, GA 30341.
[Maintenance] has not performed any work, servicing,
or inspections on said airplane at any location
other than at its aforementioned place of business."
MARC responded to the motion to dismiss and attached the
affidavit of one of its members, Christie Lurie. Lurie's
affidavit attested to
many of the factual allegations asserted
in MARC's complaint. Lurie also testified that she and her
husband, who is also a member of MARC, are residents of
Alabama and that at least one member of MARC has resided in
Alabama since MARC's formation in 2013. Further, Lurie
stated:
"18.
"Throughout
all
of
the
negotiations
for
[MARC]'s
purchase of the Aircraft and the Aircraft's
subsequent maintenance, Maintenance interacted and
dealt exclusively with Fitch, [TAD], and/or Pelican
Bay, and [MARC] was not privy to their interactions.
12
1160914
Maintenance was the only defendant with firsthand
knowledge of what Discrepancies existed and whether,
and to what extent, those Discrepancies had been
resolved, as agreed to and required.
"19.
"Further, Fitch, [TAD], and Pelican Bay (either
directly or through its agent, JetBrokers) acted in
concert in dealing with Maintenance with respect to
the Deficiencies, which were never resolved or were
merely repaired, rather than replaced as had been
recommended and was required.
"20.
"For those reasons, Maintenance either knew or
could and should have known, through the exercise of
reasonable diligence, that the Discrepancies had not
been resolved when the Aircraft was delivered to
Fitch in March 2014 for eventual delivery to [MARC].
"....
"22.
"Instead, Maintenance's actions were part of a
larger course of concerted action to sell the
Aircraft to [MARC] without incurring the costs of
fully resolving the Discrepancies.
"23.
"Maintenance profited materially from this
conduct, both because the Aircraft was in fact sold
and delivered without the Discrepancies having been
resolved and because Maintenance did not incur the
expenses of resolving the Discrepancies (contrary to
its representations to that effect)."
13
1160914
After a hearing, the trial court denied Maintenance's
motion to dismiss on June 8, 2017. This petition followed. 1
II. Standard of Review
A petition for a writ of mandamus is the proper method by
which to challenge the denial of a motion to dismiss for lack
of personal jurisdiction. Ex parte Merches, 151 So. 3d 1075,
1078 (Ala. 2014); Ex parte Alamo Title Co., 128 So. 3d 700,
707 (Ala. 2013). In such a case, this Court applies the
following standard of review:
"'An appellate court considers de novo a trial
court's judgment on a party's motion to dismiss for
lack of personal jurisdiction.' Elliott v. Van
Kleef, 830 So. 2d 726, 729 (Ala. 2002). However, 'an
appellate court must give deferential consideration
to any findings of fact made by a trial court based
on evidence received ore tenus in connection with a
determination as to the nature and extent of a
foreign defendant's contacts with the forum state.'
Ex parte American Timber & Steel Co., 102 So. 3d
347, 353 n. 7 (Ala. 2011).
"'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
1Pelican Bay also filed a petition for writ of mandamus
from the denial of its motion to dismiss based on similar
personal-jurisdiction grounds (case no. 1160835). MARC and
Pelican Bay reached a settlement agreement, and Pelican Bay's
petition was dismissed on the joint motion of the parties.
14
1160914
refusal to do so; 3) the lack of another
adequate remedy; and 4) properly invoked
jurisdiction of the court." Ex parte United
Serv. Stations, Inc., 628 So. 2d 501, 503
(Ala. 1993).'
"Ex parte Empire Fire & Marine Ins. Co., 720 So. 2d
893, 894 (Ala. 1998)."
Ex parte Merches, 151 So. 3d at 1078.
III. Analysis
Maintenance contends that it lacks sufficient minimum
contacts with the State of Alabama to permit the Madison
Circuit Court to exercise personal jurisdiction over it. We
agree.
Alabama's long-arm rule extends to the permissible limits
of due process. See Ex parte Edgetech I.G., Inc., 159 So. 3d
629, 633 (Ala. 2014). The Due Process Clause of the
Fourteenth
Amendment
to
the
United
States
Constitution permits
a forum state to subject a nonresident defendant to its courts
only when that defendant has sufficient "minimum contacts"
with the forum state. See International Shoe Co. v.
Washington 326 U.S. 310, 316 (1945). This Court has
explained:
"'Two types of contacts can form a
basis for personal jurisdiction: general
contacts and specific contacts. General
15
1160914
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. 1865, 80 L. Ed. 2d 404
(1984); [citations omitted]. Specific
contacts, which give rise to specific
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.'"
Elliott v. Van Kleef, 830 So. 2d 726, 730 (Ala. 2002) (quoting
Ex parte Phase III Constr., Inc., 723 So. 2d 1263, 1266 (Ala.
1998)(Lyons, J., concurring in the result)). In this case,
MARC agrees that Maintenance is not subject to general
personal jurisdiction.
With regard to specific jurisdiction, this Court has
recently quoted with approval the following summary by the
Supreme Court of Oregon of the United States Supreme Court's
holdings:
"'Specific jurisdiction "depends
on
an
'affiliatio[n] between the forum and the
underlying
controversy,'
principally,
16
1160914
activity or an occurrence that takes place
in the forum State and is therefore subject
to the State's regulation." Goodyear
[Dunlop Tires Operations, S.A. v. Brown],
[564] U.S. [915] at [919], 131 S. Ct. at
2851
[(2011)]
(alteration
in
original);
see
Willemsen v. Invacare Corp.], 352 Or. [191]
at 197, 282 P.3d 867 [(2012)]. In other
words, specific jurisdiction "is confined
to adjudication of 'issues deriving from,
or connected with, the very controversy
that
establishes
jurisdiction.'"
Goodyear,
[564] U.S. at [919], 131 S. Ct. at 2851
(quoting
von
Mehren
&
Trautman,
Jurisdiction to Adjudicate: A Suggested
Analysis, 79 Harv. L. Rev. 1121, 1136
(1966)).
"'The
analytical
framework
for
determining whether specific jurisdiction
exists consists of three inquiries. See
[State ex rel.] Circus Circus [Reno, Inc.
v. Pope], 317 Or. [151,] 159-60, 854 P. 2d
461[, 465 (1993) (en banc)] (laying out
analytical
framework).
First,
the
defendant
must
have
"purposefully
avail[ed]
itself of the privilege of conducting
activities within the forum State." Hanson
v. Denckla, 357 U.S. 235, 253, 78 S. Ct.
1228, 2 L. Ed. 2d 1283 (1958). The
requirement that a defendant purposefully
direct
activity
to
the
forum
state
precludes
the
exercise
of
jurisdiction
over
a defendant whose affiliation with the
forum state is "random," "fortuitous," or
"attenuated," or the "unilateral activity
of another party or a third person."
Burger King [Corp. v. Rudzewicz], 471 U.S.
[462] at 475, 105 S. Ct. 2174 [(1985)]
(internal
citation
marks
omitted);
see
also
State ex rel. Jones v. Crookham, 296 Or.
735, 741-42, 681 P.2d 103[, 107] (1984)
17
1160914
(requirements of due process not met when
defendant's
contacts
with
Oregon
are
"minimal and fortuitous").
"'Second, the action must "arise out
of or relate to" the foreign defendant's
"activities
in
the
forum
State."
Helicopteros Nacionales de Colombia, S.A.,
v. Hall, 466 U.S. 408, 414, 104 S. Ct.
1868, 80 L. Ed. 2d 404 (1984); Burger King,
471 U.S. at 472, 105 S. Ct. 2174. Stated
differently, for an exercise of specific
jurisdiction to be valid, there must be "a
'relationship among the defendant, the
forum,
and
the
litigation.'"
Helicopteros,
466 U.S. at 414, 104 S. Ct. 1868 (quoting
Shaffer v. Heitner, 433 U.S. 186, 204, 97
S. Ct. 2569, 53 L. Ed. 2d 683 (1977)). In
further explaining that relationship, the
Supreme Court recently highlighted two
means
by
which
specific
jurisdiction
attaches: Jurisdiction may attach if a
party engages in "activity [that] is
continuous
and
systematic
and
that
activity
gave
rise
to
the
episode-in-suit."
Goodyear, [564] U.S. at [923], 131 S. Ct.
at 2853 (internal quotation marks omitted;
emphasis in original). Jurisdiction may
also attach if a party's "certain single or
occasional acts in a State [are] sufficient
to render [him or her] answerable in that
State with respect to those acts, though
not with respect to matters unrelated to
the forum connections." Id. (internal
quotation
marks omitted).
Thus, as
articulated by the Court, an exercise of
specific jurisdiction is appropriate in
cases where the controversy at issue
"derive[s] from, or connect[s] with" a
defendant's
forum-related
contacts.
Id.
at
[919], 131 S. Ct. at 2851.
18
1160914
"'Finally,
a
court
must
examine
whether the exercise of jurisdiction over
a foreign defendant comports with fair play
and
substantial
justice,
taking
into
account various factors deemed relevant,
including an evaluation of the burden on a
defendant, the forum state's interest in
obtaining convenient and effective relief,
the interstate judicial system's interest
in efficient resolution of controversies,
and
furthering
fundamental
social
policies.
Asahi Metal Industry Co. v. Superior Court,
480 U.S. 102, 113, 107 S. Ct. 1026, 94 L.
Ed. 2d 92 (1987); Burger King, 471 U.S. at
476-77, 105 S. Ct. 2174; see Circus Circus,
317 Or. at 159-60, 854 P. 2d 461.'"
Hinrichs v. General Motors of Canada, Ltd., 222 So. 3d 1114,
1121-23
(Ala.
2016)(quoting
Robinson
v.
Harley-Davidson Motor
Co., 354 Or. 572, 577-80, 316 P.3d 287, 291-92 (2013)).
MARC concedes that Maintenance is not subject to
"ordinary" specific personal jurisdiction. Rather, MARC
contends that Maintenance is subject to personal jurisdiction
in Alabama under a theory of specific jurisdiction based on
conspiracy.
It is true that this Court has recognized "that, in an
appropriate case, specific jurisdiction can be based upon the
purposeful conspiratorial activity of a nonresident defendant
aimed at an Alabama plaintiff." Ex parte Alamo Title Co., 128
So. 3d 700, 713 (Ala. 2013). Under the "conspiracy theory" of
19
1160914
specific jurisdiction, when a conspirator commits an
overt act
in furtherance of the conspiracy in the forum sufficient to
subject that conspirator to jurisdiction in the forum, the
conspirator's contacts with the forum may be imputed to a
nonresident coconspirator. This "conspiracy theory" of
specific personal jurisdiction is grounded on the "'time
honored notion that the acts of [a] conspirator in furtherance
of a conspiracy may be attributed to the other members of the
conspiracy.'" Textor v. Board of Regents of Northern Illinois
Univ., 711 F.2d 1387, 1392 (7th Cir. 1983) (quoting Gemini
Enters., Inc. V. WFMY Television Corp., 470 F. Supp 559, 564
(M.D. N.C. 1979)). As we explained in Alamo:
"To
establish
personal
jurisdiction
under
a
conspiracy theory, '"the plaintiff must plead with
particularity 'the conspiracy as well as the overt
acts within the forum taken in furtherance of the
conspiracy.'"' Ex parte McInnis, 820 So. 2d [795]
at 806–07 [(Ala. 2001)] (quoting Jungquist v. Sheikh
Sultan Bin Khalifa Al Nahyan, 115 F.3d 1020, 1031
(D.C. Cir. 1997)). The elements of civil conspiracy
in Alabama are: (1) concerted action by two or more
persons (2) to achieve an unlawful purpose or a
lawful purpose by unlawful means. Luck v. Primus
Auto. Fin. Servs., Inc., 763 So. 2d 243, 247 (Ala.
2000).
"'"'[I]f the defendant
makes
a
prima
facie
evidentiary
showing
that the Court has no
20
1160914
personal jurisdiction,
"the plaintiff is then
r e q u i r e d
t o
s u b s t a n t i a t e
t h e
j u r i s d i c t i o n a l
allegations
in
the
complaint by affidavits
or
other
competent
proof, and he may not
merely
reiterate
the
factual allegations in
t h e
c o m p l a i n t . "
Mercantile Capital, LP
v.
Federal
Transtel,
Inc., 193 F. Supp. 2d
1243, 1247 (N.D. Ala.
2002)
(citing
Future
Tech. Today, Inc. v.
OSF
Healthcare
Sys.,
218 F. 3d 1247, 1249
(11th Cir. 2000)). See
a l s o
Hansen
v.
Neumueller
GmbH,
163
F.R.D. 471, 474-75 (D.
Del.
1995)
("When
a
defendant
files
a
motion
to
dismiss
p u r s u a n t
t o
Fed.R.Civ.P.
12(b)(2)
[i.e.,
for
lack
of
personal jurisdiction],
and
supports
that
motion with affidavits,
plaintiff is required
to
controvert
those
affidavits with his own
affidavits
or
other
competent evidence in
order to survive the
motion.")(citing
Time
Share Vacation Club v.
Atlantic Resorts, Ltd.,
21
1160914
735 F.2d 61, 63 (3d
Cir. 1984)).'
"'"Ex parte Covington Pike Dodge,
Inc., 904 So. 2d 226, 229-30
(Ala. 2004) (footnote omitted)."
"'Ex parte Unitrin, Inc., 920 So. 2d 557,
560-61 (Ala. 2005).'
"Ex parte United Ins. Cos., 936 So. 2d 1049, 1053-54
(Ala. 2006). ..."
128 So. 3d at 713. Furthermore: "'"Bald speculation" or a
"conclusionary
statement"
that
individuals
are
co-conspirators
is insufficient to establish personal jurisdiction under a
conspiracy theory.'" Ex parte McInnis, 820 So. 2d 795, 806-07
(Ala. 2001) (quoting Jungquist v. Sheikh Sultan Bin Khalifa Al
Nahyan, 115 F.3d 1020, 1031 (D.C. Cir. 1997)).2
In the present case, even accepting that MARC has
sufficiently alleged and supported its claim that Maintenance
participated in a civil conspiracy so as to subject it to
jurisdiction in this State, there must be an overt act or acts
in furtherance of
the
conspiracy committed within Alabama, and
2We note that courts and commentators have questioned the
constitutional limits of conspiracy jurisdiction. See, e.g.,
Ex parte Reindel, 963 So. 2d 614, 621 (Ala. 2007); Edmond v.
United States Postal Serv. Gen. Counsel, 949 F.2d 415, 428 n.2
(D.C. Cir. 1991). Issues as to the constitutional boundaries
of conspiracy jurisdiction, however, are not directly raised
by this petition; thus, we do not directly address them.
22
1160914
that act or those acts must amount to a constitutionally
sufficient contact with Alabama that supports specific
personal jurisdiction. Here, MARC has not alleged that
Maintenance committed any act in, or has had any relevant
direct contact with, the State of Alabama. Thus, if there is
any basis for personal jurisdiction over Maintenance, we must
look to the contacts with Alabama of Maintenance's alleged
coconspirators.
Under a conspiracy theory of jurisdiction, in order to
attribute an act of a coconspirator to Maintenance, the act
must be in furtherance of the conspiracy. In this case, the
purported aim of the alleged conspiracy was to "sell the
Aircraft to [MARC] without incurring the costs of fully
resolving the Discrepancies." The only contact with Alabama
alleged by MARC is that, following MARC's purchase of the
aircraft, Fitch and TAD, MARC's alleged coconspirators,
routinely transported passengers into and out of Madison
County, Alabama, on the aircraft. We agree with Maintenance
that this contact alone is insufficient to establish personal
jurisdiction as to Fitch or TAD and thus as to Maintenance.
23
1160914
First, we are unclear how the mere operation of the
aircraft following its purchase by MARC can be considered an
act in furtherance of the alleged conspiracy, which was to
induce MARC to purchase the aircraft without the conspirators
incurring the expense of repairing the discrepancies. To this
end, it is hard to understand how the post-purchase operation
of the aircraft aided the conspiracy. The aircraft was
purchased to be flown; its particular flight path and
destination appear trivial, and certainly not integral to the
alleged conspiracy. Thus, MARC could not meet its burden of
establishing that the flights into Alabama were "acts within
[Alabama] taken in furtherance of the conspiracy." McInnis,
820 So. 2d at 806-07.
Second, even if the flights to and from Alabama could
somehow implicate Maintenance, they remain of questionable
jurisdictional
relevance.
The
hallmark
of
specific
jurisdiction is that the action arises from or relates to the
defendant's activities in the forum state, Helicopteros
Nacionales de Columbia, S.A. v. Hall, 466 U.S. 408, 414
(1984), i.e., that the activity "gave rise to the episode-in-
24
1160914
suit." Goodyear Dunlop Tires Operations, S.A. v. Brown, 564
U.S. 915, 923 (2011). We recently explained in Hinrichs:
"Walden [v. Fiore], 571 U.S.___, 134 S. Ct. 1115
(2014),] makes it clear that, absent general
jurisdiction, the precedents of the United States
Supreme
Court
require
that,
for
specific
jurisdiction to exist, [the defendant's] in-state
activity must 'g[i]ve rise to the episode-in-suit,'
Goodyear,
564
U.S.
at
923,
and
involve
'"adjudication of issues deriving from, or connected
with,
the
very
controversy
that
establishes
jurisdiction,"' 564 U.S. at 919. Moreover, Walden
clearly holds that whether a forum state can
constitutionally assert specific jurisdiction over
a
nonresident
defendant
'"focuses
on
'the
relationship among the defendant, the forum, and the
litigation.'"' Walden, 571 U.S. at ___, 134 S. Ct.
at 1121 (quoting Keeton v. Hustler Magazine, Inc.,
465 U.S. 770, 775, 104 S. Ct. 1473, 79 L. Ed. 2d 790
(1984), quoting in turn Shaffer v. Heitner, 433 U.S.
186, 204, 97 S. Ct. 2569, 53 L. Ed. 2d 683 (1977)).
Walden then clearly instructs that if a state is to
exercise jurisdiction consistent with due process,
'the defendant's suit-related conduct must create a
substantial connection with the forum State.' 571
U.S. at ___, 134 S. Ct. at 1121 (emphasis added)."
222 So. 3d at 1137-38.
The gist of the allegations in the complaint is that the
defendants, acting in concert to induce MARC to purchase the
aircraft, fraudulently misrepresented that the discrepancies
identified in the pre-purchase inspection had been corrected
and fraudulently suppressed information to the contrary. By
and
large,
however,
the
alleged
fraudulent
25
1160914
misrepresentations/suppressions
appear
to
have
occurred
before
the closing on the purchase of the aircraft, concerned conduct
outside Alabama, and involved entities that were not
residents
of Alabama.3 The post-purchase flights into Alabama have, at
best, a tenuous connection to the material allegations of
tortious conduct. Accordingly, those contacts lack the
"suit-
related nexus" to Alabama required for specific jurisdiction
to attach. Hinrichs, 222 So. 3d at 1140. See also Ex parte
City Boy's Tire & Brake, Inc., 87 So. 3d 521 (Ala. 2011)
(purchase of tire in Florida was an "isolated occurrence" that
was not sufficient to subject the repair shop in Florida to
personal jurisdiction in Alabama on claim that its failure to
inspect and notify the plaintiff that her other tires needed
replacing caused accident in Alabama).
3We recognize that, for the purpose of diversity
jurisdiction in federal courts, a limited-liability company's
citizenship is determined by the citizenship of its members.
See Rolling Greens MHP, L.P. v. Comcast SCH Holdings L.L.C.,
374 F.3d 1020, 1022 (11th Cir. 2004). MARC thus contends
that, because two of MARC's members were Alabama residents,
MARC should be considered an Alabama plaintiff for personal-
jurisdictional purposes. It appears, however, that the rule
for
determining
citizenship
for
diversity-jurisdiction
purposes has never been extended to the personal-jurisdiction
context, and we agree with Maintenance that doing so raises
obvious due-process concerns. Accordingly, we do
not
consider
the individual citizenship of MARC's members in our analysis.
26
1160914
In sum, MARC alleges tortious conduct related to the sale
of an aircraft negotiated and consummated outside Alabama by
nonresident parties, the only contact with Alabama being post-
purchase travel into and out of Alabama. We conclude that,
based on the evidence before the trial court, MARC has not
established
a
sufficient
nexus
between
Maintenance's
purposeful activity within Alabama and the claims made in its
action
sufficient
to subject
Maintenance
to
personal
jurisdiction in an Alabama court. Accordingly, Maintenance
has shown a clear legal right to the dismissal of the
complaint on the ground that the trial court lacks personal
jurisdiction over it.
IV. Conclusion
For the above reasons, we grant the petition for the writ
of mandamus and direct the trial court to vacate its order
denying Maintenance's motion to dismiss and to enter an order
dismissing MARC's claims against Maintenance on the
basis that
it lacks personal jurisdiction.
PETITION GRANTED; WRIT ISSUED.
Stuart, C.J., and Bolin, Parker, Wise, and Sellers, JJ.,
concur.
Murdock and Bryan, JJ., concur in the result.
Shaw, J., dissents.
27 | November 22, 2017 |
5c6fcabb-705b-4465-b97e-8beb7af7a053 | M & T Bank v. U.S. Bank National Association, successor by merger to LaSalle Bank NA, as trustee for Washington Mutual Asset-Backed Certificates WMABS Series 2006-HE4 Trust | N/A | 1160673 | Alabama | Alabama Supreme Court | Rel: December 1, 2017
STATE OF ALABAMA -- JUDICIAL DEPARTMENT
THE SUPREME COURT
OCTOBER TERM, 2017-2018
1160673
M & T Bank v. U.S. Bank National Association, successor by
merger to LaSalle Bank NA, as trustee for Washington Mutual
Asset-Backed Certificates WMABS Series 2006-HE4 Trust (Appeal
from Calhoun Circuit Court: CV-11-900238).
PARKER, Justice.
AFFIRMED. NO OPINION.
See Rule 53(a)(1) and (a)(2)(F), Ala. R. App. P.
Stuart, C.J., and Bolin, Murdock, and Bryan, JJ., concur.
Main and Sellers, JJ., dissent.
Shaw, J., recuses himself. | December 1, 2017 |
7b058105-0648-4cc0-b959-1fa2317a09b1 | Ex parte Rockingham Boat Club, Inc. | N/A | 1151345 | Alabama | Alabama Supreme Court | REL: October 27, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334)
229-0649), of any typographical or other errors, in order that corrections may be made
before the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
_________________________
1151345
_________________________
Ex parte Rockingham Boat Club, Inc.
PETITION FOR WRIT OF MANDAMUS
(In re: Keith Edward Kelley, Jr.
v.
Rockingham Boat Club, Inc.)
(Clarke Circuit Court, CV-16-900066)
SHAW, Justice.
PETITION DENIED. NO OPINION.
Stuart, C.J., and Bolin, Parker, Murdock, Main, Wise, and
Bryan, JJ., concur.
Sellers, J., dissents.
1151345
SELLERS, Justice (dissenting).
I respectfully dissent. A single isolated sale, in this
case of a boat, even when coupled with an agreement to
undertake to make minor repairs, is an insufficient basis on
which to establish in personam jurisdiction. Jurisdiction
depends on the nature and extent of a defendant's in-state
activities. In this case, the defendant, Rockingham Boat
Club, Inc., did not target Alabama or otherwise specifically
direct its commercial activities toward Alabama so as to
benefit from the protections afforded by Alabama's laws. For
jurisdiction to exist, a defendant's activities must create a
substantial nexus with Alabama; one isolated sale is not
sufficient. I would issue the writ and direct the trial court
to dismiss the action.
2 | October 27, 2017 |
b20fa180-b79f-40ec-ab05-7166d3c5912b | Ex parte Otha Lee Woods. | N/A | 1160619 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
November 17, 2017
1160619
Ex parte Otha Lee Woods. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF
CRIMINAL APPEALS (In re: Otha Lee Woods v. State of Alabama) (Montgomery Circuit
Court: CC13-1482; Criminal Appeals :
CR-14-0845).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on November 17, 2017:
Writ Denied. No Opinion. Shaw, J. - Stuart, C.J., and Bolin, Parker, Main, Wise, Bryan,
and Sellers, JJ., concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 17th day of November, 2017.
l i t a
Clerk, Supreme Court of Alabama | November 17, 2017 |
068554ec-db8b-4e59-af0d-d95d5b761f9f | Alabama River Group, Inc., and George Landegger v. Conecuh Timber, Inc. et al | N/A | 1150040 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
November 17, 2017
1150040
Alabama River Group, Inc., and George Landegger v. Conecuh Timber, Inc. et al
(Appeal from Monroe Circuit Court: CV-10-900079).
CERTIFICATE OF JUDGMENT
WHEREAS, the ruling on the application for rehearing filed in this case and indicated
below was entered in this cause on November 17, 2017:
Application Overruled. No Opinion. Parker, J. - Stuart, C.J., and Bolin, Shaw, Main, Wise,
and Bryan, JJ., concur. Sellers, J., recuses himself.
WHEREAS, the appeal in the above referenced cause has been duly submitted and
considered by the Supreme Court of Alabama and the judgment indicated below was entered
in this cause on September 29, 2017:
Affirmed In Part; Affirmed Conditionally In Part. Parker, J. - Main, Wise, and Bryan, JJ.,
concur. Stuart, C.J., and Bolin, J., concur in part and concur in the result. Shaw, J., concurs in
the result. Sellers, J., recuses himself.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 17th day of November, 2017.
Clerk, Supreme Court of Alabama | November 17, 2017 |
ae5b79da-316b-4241-a235-bf038a7f4fd5 | Karren Hughes, as executrix of the Estate of Thomas Doster v. Noland Hospital Dothan II, LLC | N/A | 1151315 | Alabama | Alabama Supreme Court | Rel: October 27, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
____________________
1151268
____________________
Noland Hospital Dothan II, LLC
v.
Karren Hughes, as executrix of the Estate of Thomas Doster
____________________
1151315
____________________
Karren Hughes, as executrix of the Estate of Thomas Doster
v.
Noland Hospital Dothan II, LLC
Appeals from Houston Circuit Court
(CV-09-900240)
1151268, 1151315
BRYAN, Justice.
1151268 –- AFFIRMED. NO OPINION.
See Rule 53(a)(1) and (a)(2)(F), Ala. R. App. P.
Stuart, C.J., and Parker, Shaw, Main, and Wise, JJ.,
concur.
Bolin and Murdock, JJ., dissent.
Sellers, J., recuses himself.
1151315 -– APPEAL DISMISSED AS MOOT.
Stuart, C.J., and Parker, Shaw, Main, and Wise, JJ.,
concur.
Murdock, J., concurs in the judgment of dismissal only.
Bolin, J., dissents.
Sellers, J., recuses himself.
2
1151268, 1151315
MURDOCK, Justice (dissenting in case no. 1151268 and
concurring in the judgment of dismissal only in case no.
1151315).
In case no. 1151268, an appeal, this Court affirms
without opinion a judgment for money damages awarded on a
wrongful-death claim against Noland Hospital Dothan II, LLC
("Noland"), in favor of Karren Hughes, as executrix of the
estate of Thomas Doster, who allegedly was injured and
subsequently died from a fall that occurred while Doster was
a patient at one of Noland's hospitals. Principal among the
issues in the case are whether Doster suffered a fall in his
hospital room sufficient to cause internal head injuries, and
whether he did in fact suffer internal head injuries that
contributed to his death, or whether his death instead
resulted
from
the
progression
of
certain
preexisting
conditions.
The judgment of the trial court in favor of Hughes was
based upon a verdict entered by a jury that heard testimony as
to a hearsay statement made by Doster himself to the effect
that he fell, which the trial court admitted under the
excited-utterance exception to the hearsay rule. See Rule
803(2), Ala. R. Evid. Given Doster's general condition and
3
1151268, 1151315
state of mind, as well as the timing of the out-of-court
statement at issue, that statement did not in my opinion have
the necessary attributes of trustworthiness or otherwise
qualify
for
admission
under
the
excited-utterance exception
to
the hearsay rule.
In addition, the jury heard testimony from Doster's
brother, who relayed an out-of-court statement by an
unidentified "intern or something," which apparently was
admitted into evidence under Rule 801(d)(2)(C) or (D), Ala. R.
Evid., as an admission by a party opponent. In my view, the
record contains insufficient information to establish this
declarant to be an agent or servant of the hospital, or to
establish that his statement concerned a matter within the
scope of any such agency, so as to qualify for exclusion from
the hearsay rule under the admission-of-party-opponent
provisions of Rule 801(d)(2)(C) and (D).
Based on the foregoing, and because I believe the
aforesaid testimony was material (given what I consider to be
the speculative and inferential nature of much of the other
evidence), I respectfully dissent from the affirmance of the
4
1151268, 1151315
trial court's judgment based on a verdict rendered by a jury
that heard that evidence.1
In a cross-appeal, case no. 1151315, Hughes argues that
the trial court's judgment against Noland should be upheld on
the alternative ground that there was evidence proffered, but
improperly excluded from the jury's consideration, that the
trial judge could have considered to justify his denial of
Noland's postjudgment motion for a judgment as a matter of
law. Rule 50(d), Ala. R. Civ. P., provides:
"If the motion for judgment as a matter of law is
denied, the party who prevailed on the motion may,
as appellee, assert grounds entitling the party to
a new trial in the event the appellate court
concludes that the trial court erred in denying the
motion for judgment. If the appellate court
reverses the judgment, nothing in this rule
precludes it from determining that the appellee is
entitled to a new trial, or from directing the trial
court to determine whether a new trial shall be
granted."
Although Rule 50(d) allows this Court, upon reversing the
denial of a motion for a judgment as a matter of law, to order
a new trial or to direct a trial court to determine whether to
1In addition, I am concerned about the fact that one or
more jurors had discussions about the case with an alternate
juror before the conclusion of the trial. I find it
unnecessary to further address this as a potential ground for
reversal in light of the concerns addressed in the text.
5
1151268, 1151315
order a new trial, Hughes expressly states that she is not
requesting a new trial. Instead, she argues that the judgment
in her favor should be upheld as a matter of law on the basis
of the evidence that, although withheld from the jury, was
known to the trial judge.
First, if Hughes's argument were a proper alternative
basis for upholding the judgment in her favor, then a cross-
appeal to assert that alternative ground is neither necessary
nor appropriate. Such a ground would be properly asserted in
the initial appeal simply as an alternative ground for
affirming the trial court's judgment. See, e.g., Municipal
Workers Comp. Fund, Inc. v. Morgan Keegan & Co., 190 So. 3d
895, 908 (Ala. 2015).
More fundamentally, the Court cannot sustain a judgment
entered on an otherwise improper jury verdict based on the
trial court's collateral consideration of evidence not
presented to the jury. As Rule 50 indicates, perhaps a new
trial would be in order if the initial appeal were successful
and it were to be determined in a cross-appeal that there was
evidence that had been improperly excluded from the jury's
consideration that should be considered in the new trial. But
6
1151268, 1151315
the court in a jury trial cannot replace a jury's faulty
verdict with its own verdict based on evidence to which it,
but not the jury, was privy.
Based on the foregoing, I cannot agree to the dismissal
of the cross-appeal on the ground that it is moot, as stated
in this Court's order dismissing that cross-appeal. Instead,
for the reasons stated above, I find the cross-appeal, as
framed, to be without merit in its own right. Accordingly, as
to the cross-appeal, I concur in the judgment of dismissal
only.
7 | October 27, 2017 |
f18d25cd-7f60-4db9-aa6e-60d5d4edb203 | Johnston v. Castles & Crowns, Inc. | N/A | 1160171 | Alabama | Alabama Supreme Court | Rel: November 3, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334)
229-0649), of any typographical or other errors, in order that corrections may be made
before the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
_________________________
1160171
_________________________
Jami Johnston
v.
Castles and Crowns, Inc., and Delaire Tibbetts
Appeal from Mobile Circuit Court
(CV-11-900883)
WISE, Justice.
Jami Johnston, the
defendant, counterclaim plaintiff, and
third-party plaintiff below, appeals from a judgment in favor
of Castles and Crowns, Inc. ("Castles"), the plaintiff and
1160171
counterclaim
defendant
below,
and
Delaire
Tibbetts,
the
third-
party defendant below. We reverse and remand.
Facts and Procedural History
Castles is a children's clothing company formed by Julie
Vickers and Amy Bowers. Vickers and Bowers designed the
clothes, which were then manufactured at a factory in El
Salvador. Castles had two clothing seasons -- fall/winter and
summer/spring. At the beginning of each season, Castles would
submit a purchase order with the factory, which would then
produce clothing for that season. Castles' clothing was sold
by representatives who would host home parties to sell the
clothing. The representatives would receive trunks that
included samples of the fashions for that season. Customers
would then place orders that would be shipped from the factory
directly to the customer. At the end of each season, any
unsold inventory was shipped from the factory to Castles'
office. Castles would sell some of its leftover inventory
through certain liquidators and consignment companies.
At
one
time, Castles operated a factory-outlet store where it would
sell some of its leftover inventory. Subsequently, Castles
2
1160171
closed the factory-outlet store and opened a boutique store at
which it would sell some of its leftover inventory.
Brandi Stuart, Johnston's sister, worked for Castles from
2006 until 2011. Stuart was initially a representative who
sold Castles' clothing at home shows. Vickers subsequently
offered Stuart a job working in Castles' office. Ultimately,
Stuart became the operations manager for Castles. Stuart
received a salary from Castles; she was allowed to purchase
Castles' clothing at a discount; and she received a bonus each
season based on the gross sales for that season. Stuart
testified that the bonus was originally 1%, but it was
increased to 3% at some point. However, Castles presented
evidence indicating that Stuart received a 1% bonus the entire
time she worked for Castles. Vickers testified that, on one
occasion, Stuart was allowed to take her bonus in Castles'
clothing but that every other bonus was in cash. However,
Stuart testified that she was allowed to take her bonuses in
cash, clothing, or a combination of cash and clothing.
In 2009, Stuart contacted Johnston and asked her if she
was interested in selling children's clothing. Subsequently,
Johnston
formed
Children's
Liquidations,
a
consignment
company
3
1160171
that would provide children's clothes to other consignment
companies for sale. Castles presented evidence indicating
that, from 2009 to 2010, while she was working with Castles,
Stuart had 7,149 pounds of Castles' clothing shipped either to
Johnston or to consignment companies used by Johnston. Stuart
used Castles' FedEx shipping account to ship the clothing.
Tibbetts, who worked at Castles' boutique store, testified
that, on one occasion, Johnston came to the store and picked
up multiple boxes of Castles' clothing. Vickers testified
that she was aware that, during the time Stuart worked for
Castles, some clothes were being sent to Johnston from
Castles. When asked about her understanding as to what was
occurring with those clothes, Vickers replied that, on a
couple of occasions, Stuart had asked her if it was okay if
she sent some clothes to Johnston, just as she would to other
liquidators; that Vickers was aware that Johnston was
receiving those clothes; and that Vickers was expecting to
receive a check from Johnston upon the sale of the clothes,
just as she did from the other liquidators. The evidence at
trial established that neither Stuart nor Johnston paid
Castles for those clothes or remitted any of the proceeds from
4
1160171
Johnston's sales of the clothes to Castles. However, Stuart
maintained that the clothes sent to Johnston were part of her
bonuses that she had taken in clothing. Additionally,
Johnston testified that Stuart told her that she had either
received the clothes as part of her bonus or that she had
purchased the clothing.
Evidence was presented indicating that Johnston had sent
some of the Castles' clothing she had received from Stuart to
consignment companies. Johnston did not use the same
consignment companies as Castles used. On some occasions,
Johnston took some of the items and sold them at a warehouse
sale. For the items Johnston had sent to other consignment
companies, the consignee would retain a portion of the sales
proceeds as a fee and remit the remaining amount to Johnston.
Of that amount, Johnston would keep 30% and give Stuart 70%.
For items Johnston sold at the warehouse sale, Johnston would
retain the original consignee's fee. Of the amount remaining
after the deduction of that fee, Johnston would receive 30%
and Stuart would receive 70%.
Some of Castles' FedEx records indicated that some
packages had been shipped from Castles directly to the
5
1160171
consignment companies used by Johnston. There were also some
FedEx records that listed Johnston as the sender and
Johnston's consignment companies as the recipients.
In January 2011, Vickers terminated Stuart's employment
based on issues with her performance. After Stuart's
employment was terminated, Tibbetts, who was working at
Castles' boutique store, received a telephone call from a
woman who asked for "Jami." When told that no one named Jami
worked for Castles, the woman asked for Stuart. When told
that Stuart was no longer with the company, the woman asked if
Castles' clothing was going to be sent for a consignment sale.
Tibbetts told the woman she would have to get back with her,
and Tibbetts contacted Vickers. Vickers testified that they
subsequently started
going
through
Castles'
records.
Castles'
FedEx records showed the shipments to Johnston. Tibbetts also
testified that her 2010 end-of-the-year inventory showed a
large amount of missing inventory. Additionally, Vickers
discovered credit-card statements for Castles that included
personal charges made by Stuart. Johnston testified that, at
the time of the trial, she still had boxes of Castles'
clothing in her home.
6
1160171
Michelle Cox was the owner of New 2 U, a consignment
company that put on events in the fall and spring in various
locations in Mississippi. From September 2009 to March 2011,
Cox and Johnston had an ongoing relationship pursuant to which
Johnston shipped Castles' clothing to Cox; Cox sold the
clothing at New 2 U consignment events; Cox retained 30% of
the sales proceeds; and the remaining 70% of the sales
proceeds were sent to Johnston. Cox's business relationship
with Johnston ended at the conclusion of the March 2011 event.
Cox testified that, during the March 2011 event in Tupelo, she
received a telephone call from Tibbetts, who identified
herself as working for Castles. Tibbetts asked Cox if they
had any Castles' inventory. When Cox replied that they did,
Tibbetts told Cox that she needed to pull those items from the
sales floor. Cox testified that, when she asked why, Tibbetts
asked her how she had obtained Castles' clothing and that she
told Tibbetts that Johnston had shipped the items to her. She
further testified that Tibbetts told her that Castles was
conducting an internal audit; that some discrepancies had
come
to light; and that Castles wanted to look into it further.
Cox testified that she did not know what Tibbetts meant; that
7
1160171
Tibbetts never used the word "stolen"; and that she had asked
Tibbetts specifically if the items that had been shipped to
her had been stolen. Cox went on to testify that
"[i]t was definitely implied that they were saying
that [Johnston] wasn't the rightful owner of those
items and did not have the right to send them to
me."
Cox testified that Tibbetts asked her to pull Castles' items
from the sales floor; to return the items to Castles; and to
send any proceeds from Castles' items that had been sold up to
that point to Castles. Cox refused to pull the items from
the sales floor, refused to send the items to Castles, and
refused to send the proceeds from the items that had been sold
to Castles. Ultimately, Cox remitted 70% of the proceeds from
that event to Johnston. At the conclusion of the March 2011
event, Cox stopped selling Castles' items on consignment for
Johnston. However, Cox testified that, about one year later,
Johnston contacted her and asked her to sell another line of
children's clothing that Johnston was representing. Cox said
that she started selling that line of clothing.
On April 22, 2011, Castles sued Stuart and Johnston. The
complaint alleged claims of conversion; civil conspiracy;
"willfulness, negligence, and wantonness"; trespass to
8
1160171
chattel; and unjust-enrichment against Johnston and Stuart.
It also asserted fraudulent-misrepresentation and suppression
claims against Stuart.
On May 26, 2011, Johnston filed her answer. She also
asserted a counterclaim against Castles and a third-party
complaint against Vickers and Tibbetts. In her counterclaim
and third-party complaint, Johnston alleged claims of
defamation;
"negligence,
wantonness,
and
willfulness";
conspiracy; and tortious interference with business and
contractual relations. She also sought recovery against
Castles under the theory of respondeat superior.
On June 28, 2011, Castles filed its "Answer to Jami
Johns[t]on's Counterclaims and Third-Party Complaint."
Stuart subsequently filed an answer and an amended
answer. Stuart included a counterclaim against Castles
alleging libel and slander and tortious interference with
Stuart's business relationships.
On January 21, 2013, Castles filed its first amended
complaint, asserting the same claims as it did in the original
complaint. Count one alleged conversion and stated, in
pertinent part:
9
1160171
"25.
[Stuart
and
Johnston]
appropriated
to
their
own use and benefit pieces of clothing belonging to
Castles without lawful justification. The pieces of
clothing converted by [Stuart and Johnston] had a
value which will be proven at trial.
"26.
[Stuart
and
Johnston]
appropriated
to
their
own use and benefit shipping labels belonging to
Castles and the use of Castles' shipping account.
The appropriated shipping labels and use of Castles'
shipping account had a value which will be proven at
trial."
Count two asserted a claim of civil conspiracy and
stated, in pertinent part:
"31. At all times material, [Stuart and
Johnston] did knowingly combine with each other and
others, known and unknown, to accomplish by concert
the unlawful purpose of appropriating Castles'
property as described above, and [Stuart and
Johnston] did cause Castles to suffer damage in the
form of substantial financial loss, including loss
of income, loss of past and future profits, and
injury to business reputation."
Count seven alleged unjust enrichment and stated:
"[Stuart and Johnston] hold monies and other
property
improperly
received,
appropriated,
converted, or usurped from Castles as set forth
above. [Stuart and Johnston] were thereby unjustly
enriched and secured benefits in the form of those
monies, property and/or assets. It would be
unconscionable and unjust for [Stuart and Johnston]
to retain those benefits.
"WHEREFORE, Castles demands judgment against
[Stuart and Johnston] requiring them to disgorge all
funds, profits, gain, unjustified expenses, and all
other monies and/or property that are rightfully the
10
1160171
property of Castles, and pay damages and/or
restitution as equitable relief appropriate under
Alabama law, and award Castles' costs, expenses and
attorneys' fees. Castles demands the imposition of
a constructive trust in favor of it as to all money
received by [Stuart and Johnston] from the sale of
Castles' property, and such other relief as it may
be entitled."
Castles, Vickers, and Tibbetts filed a motion for a
summary judgment as to the counterclaims filed by Stuart and
Johnston and the third-party claims filed by Johnston. The
trial court granted the motion "as to Brandi Stuart and Jami
Johnston's claims for libel, negligence, wantonness, and
willfulness." However, it denied the motion as to the
remaining claims.1
Trial of this case started on August 29, 2016. After
the close of the evidence, Castles and Johnston each filed a
motion for judgment as a matter of law. The trial court
entered a judgment as a matter of law as to Johnston's
remaining third-party claims against Vickers and Stuart's
remaining counterclaims against Castles. Johnston did not
pursue her conspiracy claim against Tibbetts and Castles.
1Apparently, the summary judgment disposed of Stuart's
counterclaim against Castles alleging libel, but not Stuart's
counterclaim alleging slander against Castles or Johnston's
counterclaim/third-party claim alleging defamation against
Castles, Vickers, and Tibbetts.
11
1160171
Castles did not pursue its willfulness, negligence, and
wantonness claim and its trespass-to-chattel claim against
Johnston and Stuart. It also did not pursue its fraudulent-
misrepresentation claim, its suppression claim, and its
unjust-enrichment claim against Stuart. Castles' conversion
and civil-conspiracy claims against Johnston and Stuart;
Castles' unjust-enrichment claim against Johnston; and
Johnston's defamation claim and tortious-interference-with-
business-and-contractual-relations claim against Castles and
Tibbetts were submitted to the jury. During its oral charge,
the trial court stated:
"Castles and Crowns also has a claim for unjust
enrichment against Defendant Jami Johnston only. In
the event you find in favor of Ms. Johnston on the
conversion, conspiracy claims."
(Emphasis added.) It also stated:
"All right. In the event you find in favor of
Defendant Jami Johnston on the claims of conversion,
conspiracy, Castles also then asserts a claim that
Jami Johnston was unjustly enriched. And to prevail
on the unjust enrichment, Castles must then prove by
a preponderance of the evidence that Jami Johnston
knowingly accepted, knowingly accepted and retained
a benefit provided by Castles and Castles had a
reasonable expectation of compensation."
(Emphasis added.)
The verdict form provided, in pertinent part:
12
1160171
"We, the jury, find in favor of the Plaintiff,
Castles and Crowns, Inc., and against Defendant
Brandi Stuart ___ (check if applicable) and
Defendant Jami Johnston ___ (check if applicable)
for conversion.
"OR
"We, the jury find in favor of the Defendant ___
Brandi Stuart (check if applicable) and Defendant
Jami Johnston ___ (check if applicable) on the
conversion count.
"We, the jury, find in favor of the Plaintiff,
Castles and Crowns, Inc., and against Defendant
Brandi Stuart ___ (check if applicable) and
Defendant Jami Johnston for engaging in a conspiracy
to
convert
Castles
inventory
___
(check
if
applicable).
"OR
"We, the jury, find in favor of the Defendant
___ Brandi Stuart (check if applicable) and
Defendant Jami Johnston ___ (check if applicable) on
the conspiracy to convert inventory count.
"We, the jury, award to the Plaintiff, Castles
and Crowns, Inc., compensatory damages in the amount
of _________ and, if applicable, punitive damages in
the amount of _________.
"If you do not find against Jami Johnston on
either of the above counts, you must decide whether
she is liable for unjust enrichment. We, the jury,
find in favor of the Plaintiff, Castles and Crowns,
Inc., and against Defendant Jami Johnston for unjust
enrichment ___ (check if applicable).
13
1160171
"We, the jury, award to the Plaintiff, Castles
and Crowns, Inc., _______ in compensatory damages on
the unjust enrichment count.
"OR
"We the jury find in favor of Defendant Jami
Johnston ___ (check if applicable) on the unjust
enrichment count."
(Emphasis added.) During its charge to the jury, the trial
court reviewed the verdict form, stating, in pertinent part:
"And here it says: 'If you do not find against
Jami Johnston on either of the above counts, you
then get into the unjust enrichment. We, the jury
find in favor of the Plaintiff Castles and Crowns
and against Jami Johnston for unjust enrichment' --
"Check mark if that's your verdict.
"-- based on the evidence.
"Below that, we, the Jury, award to the
Plaintiff
Castles
and
Crowns,
blank,
and
compensatory damages on the unjust enrichment claim.
"If you check that claim.
"Or, we, the Jury, find in favor of the
Defendant Jami Johnston, if that's your verdict
based on the evidence on the unjust enrichment
count."
The jury returned a verdict in favor of Castles and
against Johnston and Stuart on the conversion and conspiracy
claims. It awarded Castles $800,000 in compensatory damages
and $1 in punitive damages. It also found in favor of Castles
14
1160171
and against Johnston on the unjust-enrichment claim and
awarded Castles $75,000 in compensatory damages. The jury
also found in favor of Castles and Tibbetts and against
Johnston on the defamation and tortious-interference-with-
business-and-contractual-relations claims.
After the jury was discharged, the following occurred:
"THE COURT: All right. The jury came back with
a verdict in favor of Castles and Crowns and also --
Castles and Crowns on the conversion and the
conspiracy claim. And then also further came back
in favor of Castles and Crowns against Jami Johnston
on the claim for unjust enrichment, which is not
consistent with my instructions and the law. So I'm
going to set aside that verdict and render judgment
in favor of Jami Johnston on the unjust enrichment
claim.
"Any other
challenges to
the
verdict,
of
course,
you have time to do it, but I'm going to go ahead
and get that done now.
"[COUNSEL FOR STUART]: Well, so you're curing
the inconsistent verdict?
"THE COURT: Yes, I'm curing the inconsistency.
I think that's --
"Now, if you want to challenge that I'm wrong
doing that, yes, you certainly have the right to do
that. It could be that the whole thing gets thrown
out, as you might already -- later.
"[COUNSEL FOR STUART]: Well, I mean, if it's --
I don't know. I'm just, in my mind, I'm saying it's
an inconsistent verdict.
15
1160171
"[COUNSEL FOR JOHNSTON]: Very inconsistent.
"[COUNSEL FOR STUART:] It's an inconsistent
verdict, so, you know ....
"THE COURT: It's inconsistent, no question.
"[COUNSEL FOR CASTLES]: Yeah, the jury made a
mistake; however, y'all agreed to the verdict form.
Raised no objections to the verdict form.
"THE COURT: I
don't think there's
anything wrong
with the verdict form.
"[COUNSEL FOR STUART]: They didn't follow
instructions, so, you know, that may not -- that's
just ....
"THE COURT: Yes. That could be an issue, maybe
it's not an issue, I don't know, but it certainly
was not consistent. And I think, you know, I'm
setting aside this unjust enrichment. But, yeah, I
fully expect there to be further discussion about
whether that's the right thing to do or not. Now,
let's just leave it like that and file what you need
to file within 30 days. Okay?
"[COUNSEL FOR STUART]: Thank you.
"[COUNSEL FOR CASTLES]: Thank you."
On September 1, 2016, the trial court entered a final
judgment on the verdict. In its judgment, the trial court
stated:
"The jury also returned a verdict against Defendant
Jami Johnston in the amount of $75,000 for unjust
enrichment, even though the Court instructed the
jury (as did the verdict form) to consider the
unjust enrichment claim only if the jury did not
return a verdict against Jami Johnston on the claims
16
1160171
for conversion and conspiracy. The jury did return
a verdict against Jami Johnston on the claims for
conversion and conspiracy; thus, the verdict against
Defendant Jami Johnston for unjust enrichment is
inconsistent with the other findings by the jury and
the Court's instructions. Therefore, the Court will
not enter a judgment on the jury verdict against
Defendant Jami Johnston for unjust enrichment."
On September 30, 2016, Johnston filed a Rule 59, Ala. R.
Civ. P., motion to alter, amend, or vacate the judgment as to
her or for a new trial. She argued that she was entitled to
a new trial based on an inconsistent verdict. In her motion,
Johnston argued that a trial court cannot cure an inconsistent
verdict or any other erroneous verdict by modifying the
verdict. Johnston also filed a Rule 50, Ala. R. Civ. P.,
renewed motion for judgment as a matter of law.
On October 3, 2016, Castles, Vickers,2 and Tibbetts filed
a Rule 59 motion to alter or amend "certain language contained
in the Court's Final Judgment in this case." In that motion,
they asked the court to take out the language in its judgment
that characterized the verdict "as 'inconsistent' with the
jury's other findings and the Court's instructions."
2Although Vickers is shown as a movant on the Rule 59
motion, all claims against her appear to have been resolved by
summary judgment and a judgment as a matter of law.
17
1160171
On November 1, 2016, Castles and Tibbetts filed their
opposition to Johnston's Rule 59 motion. They asserted that
the verdict was not inconsistent. They also asserted that the
motion should be denied because the trial court allowed the
jury to decide the legal claims and then properly disposed of
the equitable claim of unjust enrichment. They also asserted
that the verdict form allowed the result claimed to be
inconsistent and that Stuart and Johnston did not object to
the verdict form. Castles also filed an opposition to
Johnston's renewed motion for a judgment as a matter of law.
On November 2, 2016, Johnston filed a "Reply/Supplement"
to her Rule 59 motion and a response to Castles, Vickers, and
Tibbetts' Rule 59 motion.
On November 4, 2016, the trial court denied Johnston's
motion to alter, amend, or vacate the judgment or for a new
trial; denied Johnston's renewed motion for a judgment as a
matter of law; and denied the motion to alter or amend the
judgment filed by the Castles, Vickers, and Tibbetts. This
appeal followed.3
3Stuart also filed a notice of appeal in this Court, which
was docketed as case no. 1160227. On June 23, 2017, counsel
for Castles and Tibbetts filed a motion to dismiss the appeal,
which this Court granted on July 28, 2017.
18
1160171
Discussion
I.
Johnston argues that the trial court erred when it did
not grant her motion for a new trial after expressly
determining that the jury's verdict was inconsistent.
Specifically, she asserts that the jury was bound to abide by
the trial court's instructions and that the jury did not
follow the trial court's instructions regarding the unjust-
enrichment claim.
This Court addressed a similar situation in Clark v.
Black, 630 So. 2d 1012 (Ala. 1993). Clark involved an
accident that occurred when a motorcycle being driven by
Michael Clark collided with an automobile being driven by
Tommie Black. Michael, by and through his parents as next
friends, and his parents, individually, sued Black. The
plaintiffs included a negligence claim against Black and
sought damages for physical and mental suffering, loss of
services and society, and medical expenses. They also alleged
that Black had acted wantonly, and they requested punitive
damages. The case eventually went to trial. During the
trial, the trial court directed a verdict in favor of Black as
to the wantonness claim. The jury then found in favor of
19
1160171
Michael and his parents as to the negligence claim. It then
awarded Michael $5,000 as past damages and $15,000 in future
damages. It assessed Michael's parents' damages as $0.
Subsequently, the Clarks moved for a new trial and argued, in
pertinent part:
"'The jury's verdict in favor of Michael,
Tillman, and Carolyn Clark with an award of
damages to Michael Clark but without an
award of damages to Tillman and Carolyn
Clark constitutes an inconsistent verdict
as a matter of law.'"
Clark, 630 So. 2d at 1014. The trial court denied the Clarks'
postjudgment motion. On appeal, the Clarks argued that the
jury's verdict was inconsistent and therefore invalid. This
Court addressed this issue as follows:
"The jury resolved the liability issue in favor
of all three plaintiffs; it awarded Michael $20,000,
but awarded his parents, suing individually, $0,
notwithstanding virtually uncontroverted evidence
that Michael's medical expenses had exceeded by
$5,000 the amount paid or covered by insurance. See
generally Ala. Code 1975, § 12–21–45 (abolishing the
'collateral source rule'). The Clarks contend that
such a verdict was inconsistent as a matter of law,
and, consequently, that their motion for a new trial
was due to be granted. Black contends that
Michael's $20,000 award included compensation for
medical expenses, and, therefore, she insists that
the verdict is not inconsistent, because, she
argues, in the complaint Michael, not his parents,
sought
compensation
for
medical
expenses.
We
disagree with Black's contention.
20
1160171
"Regardless of the posture of the claims in the
complaint for medical expenses, the trial judge,
without objection, charged the jury that the parents
were entitled to compensation for medical expenses
incurred in the treatment of the minor. More
specifically, he stated:
"'Now, in this case, you have a suit
that is brought by the parents of Michael
Clark on his behalf. The evidence in the
case is that Michael Clark is a minor and
the law requires that the parents sue as
next friend of the minor. Therefore, we
have the claim of Michael Clark [that] is
brought ... by the parents. Also, we have
the claim of the parents, individually.
"'...
[T]he
parents,
in
their
individual rights, are bringing a claim for
medical
expenses,
nursing
services
provided
to the child, and loss of services of their
minor child for temporary disability, and
loss of services for their minor child for
permanent disability.
"'....
"'The measure of damages for medical
expenses
is
all
reasonable
expenses
necessarily
incurred
for
doctors
and
medical bills which the plaintiff[s have]
paid or become obligated to pay and the
amount of reasonable expenses of medical
care, treatment, and services reasonably
certain to be required in the future. The
reasonableness of, and the necessity for,
such
expenses
are
matters
for
your
determination from the evidence.
"'....
"'If you are reasonably satisfied from
the evidence that the plaintiff[s] paid, or
21
1160171
became obligated to pay, medical expenses
for the care and treatment of [their] minor
child as a proximate consequence of the
negligence of the defendant, then the
plaintiff[s] would be entitled to recover
the reasonable expense for such care and
treatment as shown by the evidence as being
reasonably necessary.'
"(Emphasis added.)
"Unchallenged jury instructions become the law
of the case. Louisville & Nashville R.R. v. Atkins,
435 So. 2d 1275 (Ala. 1983). The jury is bound to
follow
such
instructions,
even
if
they
are
erroneous. Lee v. Gidley, 252 Ala. 156, 40 So. 2d
80 (1949) (erroneous instructions became the law of
the case, and a judgment entered on the jury's
verdict comporting with those instructions would not
be reversed on appeal). 'A verdict contrary to [the
court's instructions] would have to be set aside on
motion' of the prejudiced party. New Hampshire Fire
Ins. Co. v. Curtis, 264 Ala. 137, 142, 85 So. 2d
441, 446 (1955).
"Pursuant to these principles, the jury was
bound by the trial court's instructions to award
damages to Tillman and Carolyn Clark for medical
expenses if it resolved the liability issue in the
Clarks' favor. Because it so resolved this issue,
we hold that the jury's failure to award the parents
any amount was inconsistent with the virtually
uncontroverted
evidence
that
medical
expenses
exceeded by approximately $5,000 the amount paid by
insurance,
and
was
contrary
to
the
court's
instructions. Consequently, the trial court erred in
denying the Clarks' motion for a new trial."
630 So. 2d at 1017-18 (some emphasis added; footnotes
omitted). See also Monteleone v. Trail Pontiac, Inc., 395 So.
2d 1003, 1005 (Ala. Civ. App. 1980) (holding that, "[w]here
22
1160171
the jury disregards the instructions of the trial court, the
court falls into error if it denies appellant's motion for new
trial which raises the legality of the verdict. Edwards
Chevrolet Co. v. Brokaw, 47 Ala. App. 631, 259 So. 2d 838
(1972).").
"A verdict has been described as 'inconsistent'
when the jury 'inconsistently resolved the same
issue in two separate counts,' State Farm Fire &
Cas. Co. v. Slade, 747 So. 2d 293, 319 (Ala. 1999),
when the verdict appears to be 'the result of
confusion,' City of Bessemer v. Foreman, 678 So. 2d
759, 760 (Ala. 1996), or when the record in a case
does not reveal a situation in which the jury's
decisions can coexist, Ex parte Alfa Mut. Ins. Co.,
799 So. 2d 957, 962 (Ala. 2001). See also Smith v.
Richardson, 277 Ala. 389, 391, 171 So. 2d 96, 97
(1965) (stating that differing verdicts on separate
but identical claims filed by separate parties were
'clearly inconsistent, having been rendered at the
same time by the same jury, on identical facts, [and
having]
render[ed]
speculative
what
the
jury
intended by its verdicts. Patently, the verdicts
indicate confusion on the part of the jury.'). When
a jury verdict is inconsistent, the proper remedy is
a new trial. Bessemer, 678 So. 2d at 760. This is
so
because
'any
attempt
to
reconcile
the
inconsistencies in a verdict must be based on mere
speculation about the jury's intent.' Id.; see also
A.L. Williams & Assocs., Inc. v. Williams, 517 So.
2d 596, 598 (Ala. 1987) ('Where the jury verdict is
the result of confusion or is inconsistent in law,
the trial court should grant a new trial. A new
trial is necessary, because once the jury is
dismissed
any
attempt
to
reconcile
the
inconsistencies in a verdict amounts to mere
speculation about the jury's intent.' (citation
omitted))."
23
1160171
Jones Express, Inc. v. Jackson, 86 So. 3d 298, 303-04 (Ala.
2010) (emphasis added).
"As this Court stated in Underwriters
Nat'l
Assurance Co. v. Posey, 333 So. 2d 815, 817 (Ala.
1976):
"'When two actions are tried together,
and inconsistent verdicts are rendered,
sound practice requires that both verdicts
be set aside without attempt by analysis of
the evidence to determine which result the
jury intended. This rule of law is based
upon the principle that, where verdicts are
inconsistent on their face the jury has
misconceived the issues presented, or was
prompted by bias.'"
Barnes v. Oswalt, 579 So. 2d 1319, 1323 (Ala. 1991). Further,
"[t]his Court has written:
"'Where a jury verdict is the result
of confusion or is inconsistent in law, the
trial court should grant a new trial; a new
trial is necessary because, once the jury
is dismissed, any attempt to reconcile the
inconsistencies in a verdict must be based
on mere speculation about the jury's
intent.'
"City of Bessemer v. Foreman, 678 So. 2d 759, 760
(Ala. 1996). See also Clark v. Black, 630 So. 2d
1012 (Ala. 1993); Humana Med. Corp. v. Traffanstedt,
597 So. 2d 667 (Ala. 1992)."
Ex parte Alfa Mut. Ins. Co., 799 So. 2d 957, 962 (Ala. 2001).
In this case, the trial court instructed the jury to
consider Castles' unjust-enrichment claim against Johnston if
24
1160171
it did not find against Johnston on the conversion and
conspiracy claims. The jury found against Johnston on both
the conversion and conspiracy claims. However, it then
considered the unjust-enrichment claim and found against
Johnston on that claim as well. Thus, the jury's verdict was
inconsistent with the trial court's instructions and was
obviously the result of confusion on the part of the jury.
After it had discharged the jury, the trial court acknowledged
the inconsistency in the jury's verdict. The trial court
attempted to cure that inconsistency by setting aside the
award in favor of Castles on the unjust-enrichment claim.
However, as this Court noted in Jones and Ex parte Alfa
Mutual,
the
trial
court's
attempt
to
reconcile
the
inconsistency in the jury's verdict was based on mere
speculation about the jury's intent. Additionally, the jury
failed to follow the trial court's instructions, and Johnston
moved for a new trial on that ground. Based on the decisions
in Clark and Monteleone, Johnston was entitled to a new trial
because the jury failed to follow the trial court's
instructions. For these reasons, the trial court erred when
it denied Johnston's motion for a new trial.
II.
25
1160171
Johnston also argues that, if this Court determines that
she is entitled to a new trial, the new trial "must encompass
both the claims asserted by Castles against Johnston and the
counterclaims/third-party claims asserted by Johnston against
Castles and ... Tibbetts." (Johnston's brief, at p. 32.)
"Rule 59(a) likewise addresses new trials: 'A
new trial may be granted to all or any of the
parties and (1) on all of the issues in an action
where there has been a trial by jury, for any of the
reasons for which new trials have heretofore been
granted in actions at law in the courts of Alabama.'
(Emphasis added.) The rule is not prefaced by words
such as 'on motion for new trial by one of the
parties' or by any other words that would limit its
application. It, too, requires a new trial as to
all parties and all issues in this case."
Price-Williams Assocs., Inc. v. Nelson, 631 So. 2d 1016, 1019-
20 (Ala. 1994). Thus, Johnston is entitled to a new trial as
Castles' conversion, conspiracy, and unjust-enrichment claims
against
her
and
as
to
her
tortious-interference-with-business-
and-contractual-relations and defamation claims against
Castles and Tibbetts.
Conclusion
Based on the foregoing, the trial court erred when it
denied Johnston's motion for a new trial. Accordingly, we
reverse the trial court's judgment as to Castles' conversion,
conspiracy, and unjust-enrichment claims against Johnston and
26
1160171
her
tortious-interference-with-business-and-contractual-
relations and defamation claims against Castles and Tibbetts
and remand this case for proceedings consistent with this
opinion.
REVERSED AND REMANDED.
Stuart, C.J., and Bolin, Parker, Murdock, Shaw, Main, and
Bryan, JJ., concur.
Sellers, J., dissents.
27
1160171
SELLERS, Justice (dissenting).
I respectfully dissent. In order for verdicts to be
legally irreconcilable, they must, on the basis of the same
factual situation, be mutually exclusive. In this case, there
were multiple verdicts in favor of the same party on all
claims. The verdicts in and of themselves were not mutually
exclusive. The record indicates that the trial court
instructed the jury to engage in a two-step process,
separating the counts alleging conversion and conspiracy from
the count alleging unjust enrichment. In essence, the trial
court instructed the jury that, if it found there had been
conversion and conspiracy, then there was no need to consider
the unjust-enrichment count. Only if the jury determined that
there had been no conversion and conspiracy would the jury
need to consider the unjust-enrichment count. After the jury
returned verdicts on all three counts, the trial court acted
within its
discretion in eliminating the duplicative award for
unjust enrichment. Ordering a new trial is an extreme remedy,
and, based on these facts, I would affirm the trial court's
judgment.
28 | November 3, 2017 |
28b10b20-5d47-457f-bdd6-e19156602943 | Mark Hayden v. William Cashion et al, | N/A | 1160940 | Alabama | Alabama Supreme Court | REL: November 17, 2017
STATE OF ALABAMA -- JUDICIAL DEPARTMENT
THE SUPREME COURT
OCTOBER TERM, 2017-2018
1160940
Mark Hayden v. William Cashion et al. (Appeal from Jefferson
Circuit Court: CV-12-209).
STUART, Chief Justice.
AFFIRMED. NO OPINION.
See Rule 53(a)(1) and (a)(2)(F), Ala. R. App. P.
Bolin, Parker, Murdock, Shaw, and Sellers, JJ., concur.
Main, Wise, and Bryan, JJ., recuse themselves. | November 17, 2017 |
5fee8298-db8f-4dcf-a00c-ec753ad8b507 | Ex parte Christopher Lee Price. | N/A | 1161153 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
November 17, 2017
1161153
Ex parte Christopher Lee Price. PETITION FOR WRIT OF CERTIORARI TO THE COURT OF
CRIMINAL APp Ea LS (In re: Christopher Lee Price v. State of Alabama) (Fayette Circuit
Court: CC-92-3.62; Criminal Appeals :
CR-16-0785).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on November 17, 2017:
Writ Denied. No Opinion. Bolin, J. - Stuart, C.J., and Parker, Shaw, Main, Wise, Bryan,
and Sellers, JJ., concur.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 17th day of November, 2017.
l i t a
Clerk, Supreme Court of Alabama | November 17, 2017 |
0db653af-6fc6-46d4-ae6d-71f4e7cd375b | Ex parte Jason Elkins and Paula Elkins. | N/A | 1161127 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
November 17, 2017
1161127
Ex parte Jason Elkins and Paula Elkins. PETITION FOR WRIT OF CERTIORARI TO THE
COURT OF CIVIL APPEALS (In re: Jason Elkins and Paula Elkins v. Jeff Carroll, Stanley
Maguire, Gabriel Collins, and Td Y Industries, LLC) (Madison Circuit Court: CV-14-902256;
Civil Appeals :
2160745).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on November 17, 2017:
Writ Denied. No Opinion. Bryan, J. - Stuart, C.J., and Bolin, Parker, Shaw, Main, Wise,
and Sellers, JJ., concur. Murdock, J., dissents.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 17th day of November, 2017.
Clerk, Supreme Court of Alabama | November 17, 2017 |
8a5c23b2-167d-49b9-b9ca-7ee4397557be | Ex parte Renasant Bank f/k/a M & F Bank. | N/A | 1161085 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
November 17, 2017
1161085
Ex parte Renasant Bank f/k/a M & F Bank. PETITION FOR WRIT OF CERTIORARI TO THE
COURT OF CIVIL APPEALS (In re: Renasant Bank f/k/a M & F Bank v. A. W. Clark and
Janice Clark) (Shelby Circuit Court: CV-13-901317; Civil Appeals :
2160097).
CERTIFICATE OF JUDGMENT
WHEREAS, the petition for writ of certiorari in the above referenced cause has been
duly submitted and considered by the Supreme Court of Alabama and the judgment indicated
below was entered in this cause on November 17, 2017:
Writ Denied. No Opinion. Parker, J. - Stuart, C.J., and Bolin, Murdock, Shaw, Wise,
and Bryan, JJ., concur. Sellers, J., dissents. Main, J., recuses himself.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 17th day of November, 2017.
Clerk, Supreme Court of Alabama | November 17, 2017 |
d66f73ea-e23f-4e4b-9a7e-ed13cb7d13fa | Noland Hospital Dothan II, LLC v. Karren Hughes, as executrix of the Estate of Thomas Doster | N/A | 1151268 | Alabama | Alabama Supreme Court | Rel: October 27, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
____________________
1151268
____________________
Noland Hospital Dothan II, LLC
v.
Karren Hughes, as executrix of the Estate of Thomas Doster
____________________
1151315
____________________
Karren Hughes, as executrix of the Estate of Thomas Doster
v.
Noland Hospital Dothan II, LLC
Appeals from Houston Circuit Court
(CV-09-900240)
1151268, 1151315
BRYAN, Justice.
1151268 –- AFFIRMED. NO OPINION.
See Rule 53(a)(1) and (a)(2)(F), Ala. R. App. P.
Stuart, C.J., and Parker, Shaw, Main, and Wise, JJ.,
concur.
Bolin and Murdock, JJ., dissent.
Sellers, J., recuses himself.
1151315 -– APPEAL DISMISSED AS MOOT.
Stuart, C.J., and Parker, Shaw, Main, and Wise, JJ.,
concur.
Murdock, J., concurs in the judgment of dismissal only.
Bolin, J., dissents.
Sellers, J., recuses himself.
2
1151268, 1151315
MURDOCK, Justice (dissenting in case no. 1151268 and
concurring in the judgment of dismissal only in case no.
1151315).
In case no. 1151268, an appeal, this Court affirms
without opinion a judgment for money damages awarded on a
wrongful-death claim against Noland Hospital Dothan II, LLC
("Noland"), in favor of Karren Hughes, as executrix of the
estate of Thomas Doster, who allegedly was injured and
subsequently died from a fall that occurred while Doster was
a patient at one of Noland's hospitals. Principal among the
issues in the case are whether Doster suffered a fall in his
hospital room sufficient to cause internal head injuries, and
whether he did in fact suffer internal head injuries that
contributed to his death, or whether his death instead
resulted
from
the
progression
of
certain
preexisting
conditions.
The judgment of the trial court in favor of Hughes was
based upon a verdict entered by a jury that heard testimony as
to a hearsay statement made by Doster himself to the effect
that he fell, which the trial court admitted under the
excited-utterance exception to the hearsay rule. See Rule
803(2), Ala. R. Evid. Given Doster's general condition and
3
1151268, 1151315
state of mind, as well as the timing of the out-of-court
statement at issue, that statement did not in my opinion have
the necessary attributes of trustworthiness or otherwise
qualify
for
admission
under
the
excited-utterance exception
to
the hearsay rule.
In addition, the jury heard testimony from Doster's
brother, who relayed an out-of-court statement by an
unidentified "intern or something," which apparently was
admitted into evidence under Rule 801(d)(2)(C) or (D), Ala. R.
Evid., as an admission by a party opponent. In my view, the
record contains insufficient information to establish this
declarant to be an agent or servant of the hospital, or to
establish that his statement concerned a matter within the
scope of any such agency, so as to qualify for exclusion from
the hearsay rule under the admission-of-party-opponent
provisions of Rule 801(d)(2)(C) and (D).
Based on the foregoing, and because I believe the
aforesaid testimony was material (given what I consider to be
the speculative and inferential nature of much of the other
evidence), I respectfully dissent from the affirmance of the
4
1151268, 1151315
trial court's judgment based on a verdict rendered by a jury
that heard that evidence.1
In a cross-appeal, case no. 1151315, Hughes argues that
the trial court's judgment against Noland should be upheld on
the alternative ground that there was evidence proffered, but
improperly excluded from the jury's consideration, that the
trial judge could have considered to justify his denial of
Noland's postjudgment motion for a judgment as a matter of
law. Rule 50(d), Ala. R. Civ. P., provides:
"If the motion for judgment as a matter of law is
denied, the party who prevailed on the motion may,
as appellee, assert grounds entitling the party to
a new trial in the event the appellate court
concludes that the trial court erred in denying the
motion for judgment. If the appellate court
reverses the judgment, nothing in this rule
precludes it from determining that the appellee is
entitled to a new trial, or from directing the trial
court to determine whether a new trial shall be
granted."
Although Rule 50(d) allows this Court, upon reversing the
denial of a motion for a judgment as a matter of law, to order
a new trial or to direct a trial court to determine whether to
1In addition, I am concerned about the fact that one or
more jurors had discussions about the case with an alternate
juror before the conclusion of the trial. I find it
unnecessary to further address this as a potential ground for
reversal in light of the concerns addressed in the text.
5
1151268, 1151315
order a new trial, Hughes expressly states that she is not
requesting a new trial. Instead, she argues that the judgment
in her favor should be upheld as a matter of law on the basis
of the evidence that, although withheld from the jury, was
known to the trial judge.
First, if Hughes's argument were a proper alternative
basis for upholding the judgment in her favor, then a cross-
appeal to assert that alternative ground is neither necessary
nor appropriate. Such a ground would be properly asserted in
the initial appeal simply as an alternative ground for
affirming the trial court's judgment. See, e.g., Municipal
Workers Comp. Fund, Inc. v. Morgan Keegan & Co., 190 So. 3d
895, 908 (Ala. 2015).
More fundamentally, the Court cannot sustain a judgment
entered on an otherwise improper jury verdict based on the
trial court's collateral consideration of evidence not
presented to the jury. As Rule 50 indicates, perhaps a new
trial would be in order if the initial appeal were successful
and it were to be determined in a cross-appeal that there was
evidence that had been improperly excluded from the jury's
consideration that should be considered in the new trial. But
6
1151268, 1151315
the court in a jury trial cannot replace a jury's faulty
verdict with its own verdict based on evidence to which it,
but not the jury, was privy.
Based on the foregoing, I cannot agree to the dismissal
of the cross-appeal on the ground that it is moot, as stated
in this Court's order dismissing that cross-appeal. Instead,
for the reasons stated above, I find the cross-appeal, as
framed, to be without merit in its own right. Accordingly, as
to the cross-appeal, I concur in the judgment of dismissal
only.
7 | October 27, 2017 |
51e4b3fa-2d7c-4c92-8506-720f6e7ab0a3 | McNamara v. Benchmark Insurance Co. | N/A | 1151314 | Alabama | Alabama Supreme Court | I N T H E S U P R E M
E C O U R T O F A L A B A M
A
November 17, 2017
1151314
Joseph L. McNamara, Jr. v. Benchmark Insurance Company (Appeal from Shelby
Circuit Court: CV-14-900180).
CERTIFICATE OF JUDGMENT
WHEREAS, the ruling on the application for rehearing filed in this case and indicated
below was entered in this cause on November 17, 2017:
Application Overruled. No Opinion. Sellers, J. - Stuart, C.J., and Bolin, Parker, Shaw, Main,
Wise, and Bryan, JJ., concur. Murdock, J., dissents.
WHEREAS, the appeal in the above referenced cause has been duly submitted and
considered by the Supreme Court of Alabama and the judgment indicated below was entered
in this cause on September 8, 2017:
Reversed And Remanded. Sellers, J. - Stuart, C.J., and Main, and Wise, JJ., concur. Bolin,
Parker, Shaw, and Bryan, JJ., concur in the result. Murdock, J., dissents.
NOW, THEREFORE, pursuant to Rule 41, Ala. R. App. P., IT IS HEREBY ORDERED
that this Court's judgment in this cause is certified on this date. IT IS FURTHER ORDERED
that, unless otherwise ordered by this Court or agreed upon by the parties, the costs of this
cause are hereby taxed as provided by Rule 35, Ala. R. App. P.
I, Julia J. Weller, as Clerk of the Supreme Court of Alabama, do hereby certify that the foregoing is
a full, true, and correct copy of the instrument(s) herewith set out as same appear(s) of record in said
Court.
Witness my hand this 17th day of November, 2017.
Clerk, Supreme Court of Alabama | September 8, 2017 |
b944f9ca-2d02-45d1-a92c-736d6b7fdd93 | Shelton v. Green | N/A | 1160474 | Alabama | Alabama Supreme Court | REL: November 9, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334)
229-0649), of any typographical or other errors, in order that corrections may be made
before the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
_________________________
1160474
_________________________
Leigh A. Shelton, as personal representative of the Estate
of Margaret D. Blansit, deceased
v.
I.E. Green
Appeal from DeKalb Circuit Court
(CV-15-900002)
SELLERS, Justice.
Leigh A. Shelton, as the personal representative of the
estate of Margaret D. Blansit, deceased, appeals from a
judgment in favor of I.E. Green in a personal-injury action
brought by Shelton seeking damages for injuries Blansit
1160474
allegedly suffered in a slip-and-fall accident at Green's
residence. We affirm.
In January 2015, Shelton, as the personal representative
of Blansit's estate, sued Green. Shelton alleged that, before
Blansit's death, Blansit suffered injuries when she fell at
Green's residence. It is undisputed that, before Shelton
filed her complaint, Blansit died of causes unrelated to the
fall. Green filed a motion for a judgment on the pleadings,
arguing that Blansit's cause of action abated upon her death.
The trial court agreed and granted Green's motion. Shelton
appealed.
"[O]riginally at common law ... actions for personal
injury did not survive the death of the plaintiff." King v.
National Spa & Pool Inst., Inc., 607 So. 2d 1241, 1244 (Ala.
1992) (describing the Court's opinion in Ex parte Adams, 216
Ala. 241, 113 So. 235 (1927)). See also McDowell v. Henderson
Mining Co., 276 Ala. 202, 204, 160 So. 2d 486, 488 (1963)
("Under the common law rule, followed in this State, 'no
action could be maintained, by an executor or administrator,
to recover damages for an injury, done either to the person or
the property of his testator or intestate--the action died
2
1160474
with the person--and this principle applied as well when the
deceased was the aggressor, as when he was the party
injured.'" (quoting Blakeney v. Blakeney, 6 Port. 109, 116
(Ala. 1837))). In 1867, this Court stated:
"The common-law maxim is, that personal actions
die with the person. But this maxim has been
modified, both in England and in this State, by
statutory enactments. Section 2157 of the Code [of
1852] is as follows: 'All actions on contracts,
express or implied, all personal actions, except for
injuries to the person or reputation, survive in
favor of and against the personal representatives.'"
Garrison v. Burden, 40 Ala. 513, 515 (1867).1 This Court
discussed subsequent changes to the language of the statute
addressing the survival of actions (sometimes hereinafter
referred to as "the survival statute") in a 1910 opinion:
"Our statute on the subject [of the survival of
actions] is as follows, Code [of 1907], § 2496: 'All
actions on contracts, expressed or implied; all
personal actions, except for injuries to the
reputation, survive in favor of and against the
personal representatives.'
"Prior to the adoption of the present Code, the
words 'person' 'and' preceded the word 'reputation.'
These words were stricken out of the statute by the
code committee ...."
1The provision for survival of actions generally is now
found at § 6-5-462, Ala. Code 1975. See discussion, infra.
3
1160474
Wynn v. Tallapoosa Cty. Bank, 168 Ala. 469, 491–92, 53 So.
228, 237 (1910).
That an individual's "action" for injuries to the person
survives his or her death, however, does not mean that unfiled
"causes of action" survive the death of a potential plaintiff.
"An 'action' is a proceeding pending in court to determine the
parties' rights and liabilities with respect to a legal wrong
or cause of action. A 'cause of action' is a legal wrong for
which an 'action' may be, but has not been, brought in court."
McDowell, 276 Ala. at 204, 160 So. 2d at 488. In Wynn,
supra, this Court stated: "[O]ur statute as to the survival of
'actions' does not include 'causes of actions,' or 'rights of
action.'" 168 Ala. at 491, 53 So. at 237. Likewise, in 1931,
this Court said: "Our [survival] statutes ... do not deal with
the survival of causes of actions, but with pending actions,
and leave the question as to the survival of causes of actions
to the established principles of the common law." Stoer v.
Ocklawaha River Farms Co., 223 Ala. 690, 692, 138 So. 270, 271
(1931).
The Court in McDowell, supra, noted that a 1951 amendment
to the survival statute expressly acknowledged that unfiled
4
1160474
causes of action based on contract survive the death of the
holder of the cause of action and provided further that
unfiled personal causes of action survive the death of the
tortfeasor. The amendment, however, did not change the rule
that an unfiled cause of action based on personal injury does
not survive the death of the holder of that cause of action:
"Section 150, Tit. 7, as amended, supra,
provides as follows:
"'All actions and causes of action on
contract, express or implied, and all
personal actions, except for injuries to
the reputation, survive in favor of and
against personal representatives; and all
personal causes of action survive against
the personal representative of a deceased
tort feasor.'
"The significant changes wrought by the 1951
amendment are italicized. It is to be observed that
this section still provides for survival of
'personal actions ... in favor of and against
personal representatives', and does not provide for
survival of 'personal causes of action' in favor of
personal representatives. It is provided that
'personal causes of action' survive only against a
deceased tort feasor's personal representative."
276 Ala. at 205, 160 So. 2d at 488–89.
The current version of the survival statute codified at
§ 6-5-462, Ala. Code 1975, provides:
"In all proceedings not of an equitable nature,
all claims upon which an action has been filed and
5
1160474
all claims upon which no action has been filed on a
contract, express or implied, and all personal
claims upon which an action has been filed, except
for injuries to the reputation, survive in favor of
and against personal representatives; and all
personal claims upon which no action has been filed
survive against the personal representative of a
deceased tort-feasor."
Like the prior versions of the survival statute, § 6-5-462
"did not change the common-law rule in Alabama that a cause of
action in tort does not survive in favor of the personal
representative of the
deceased." Continental Nat'l Indem. Co.
v. Fields, 926 So. 2d 1033, 1037 (Ala. 2005). Thus, "[t]he
general rule is that under Ala. Code 1975, § 6-5-462, an
unfiled tort claim does not survive the death of the person
with the claim." Malcolm v. King, 686 So. 2d 231, 236 (Ala.
1996).
Shelton concedes that, under the common-law rule,
Blansit's unfiled tort claim would not survive Blansit's death
and that § 6-5-462 does not alter the common-law rule. She
argues, however, that the legislature's decision not to
include unfiled tort claims within the operation of § 6-5-462
renders the statute unconstitutional. In support, Shelton
points to Article 1, § 13, Alabama Constitution of 1901, which
provides that "all courts shall be open; and that every
6
1160474
person, for any injury done him, in his lands, goods, person,
or reputation, shall have a remedy by due process of law; and
right and justice shall be administered without sale, denial,
or delay."2
Because the statute at issue in this case does not
abolish a common-law cause of action, we need not apply strict
review under § 13. See Reed v. Brunson, 527 So. 2d 102, 115-
18
(Ala.
1988)
(discussing the
"common-law-rights approach"
to
reviewing legislation under § 13); Lankford v. Sullivan, Long
& Hagerty, 416 So. 2d 996, 100 (Ala. 1982) ("Where common-law
rights are altered or abolished, this Court will review such
legislation more strictly than normal.").3
Shelton asserts that, even if strict review is not
applicable,
this
Court
should
still
hold
§
6-5-462
unconstitutional because, she claims, the legislature acted
2Shelton also points to Article 1, § 10, Alabama
Constitution of 1901. She did not, however, rely on § 10 in
the trial court. This Court will not consider grounds for
reversal that were not argued below. Andrews v. Merritt Oil
Co., 612 So. 2d 409, 410 (Ala. 1992).
3Although Shelton appears to argue in her brief to this
Court that a common-law right has indeed been abolished by the
legislature's failure to provide for the survival of unfiled
tort claims, her argument is unconvincing. Moreover, she did
not make that argument to the trial court.
7
1160474
arbitrarily and capriciously in providing that filed tort
actions (other than for injuries to reputation) survive the
plaintiff's death, while unfiled causes of action in tort do
not survive the death of the holder of the cause of action.
See generally Lankford, 416 So. 2d at 1000 ("Where no common
law right is affected, a judicial deference to the legislature
is required; however, the legislation may not be arbitrary or
capricious." (emphasis added)). But see Slagle v. Parker, 370
So. 2d 947, 949 (Ala. 1979) (holding that the Alabama
Constitution did not prohibit the legislature from granting
immunity from wrongful-death actions to co-employees of a
decedent, stating that, "[s]ince the right to bring an action
for wrongful death is a product of the legislature, it can be
modified, limited, or repealed as the legislature sees fit,
except as to causes of action which have already accrued"
(emphasis added)).
It has, however, been settled for some time that the
legislature has the authority to decide which actions and
causes of action survive. Indeed, more than 100 years ago,
this Court stated: "Whether our statutes should or should not
provide for the survival of causes as well as of actions, is
8
1160474
one conclusively for the Legislature and not for the court."
Wynn, 168 Ala. at 495, 53 So. at 238.4 In Walker v. Hayes,
248 Ala. 492, 28 So. 2d 413 (1946), a widow commenced a
proceeding seeking to enforce her homestead rights and
requesting that the probate court vest title to the homestead
property in her. The widow, however, died before the probate
court could enter a final decree making certain determinations
required by statutes applicable to the claiming of homestead
rights. This Court held that, pursuant to the relevant
statutory law, those determinations were necessary before
title to the property could vest in the widow and that her
rights "were personal and did not survive her death." 248
Ala. at 495, 28 So. 2d at 416. The personal representative of
the widow's estate argued that, pursuant to the survival
statute in effect at the time, the widow's action survived her
4The version of Wynn appearing in the Southern Reporter
is similar but slightly different from the version appearing
in the Alabama Reports. Specifically, the version appearing
in the Southern Reporter states: "Whether our statutes should
or should not provide for the survival of causes as well as of
actions, is a question of policy which, as to statutes, is one
exclusively for the Legislature and not for the court." 53
So. at 238. It appears that the phrase "is a question of
policy which, as to statutes" was omitted from, and the word
"exclusively" was changed to "conclusively" in, the
version of
Wynn published in the Alabama Reports.
9
1160474
death. This Court, however, acknowledged that the
legislature
had "the right to make an exception to the [survival]
statute." 248 Ala. at 496, 28 So. 2d at 416. In other words,
the legislature validly provided that, notwithstanding the
survival statute, an action filed seeking the enforcement of
homestead rights did not survive if the petitioner died before
the entry of a final decree. If the legislature can make an
exception to the survival statute for such an action, it can
certainly decide what categories of actions or causes of
action to include within the operation of the survival
statute in the first place.
In McDowell, supra, the Court considered whether an
unfiled cause of action seeking compensation for damages to a
decedent's land survived the decedent's death. The survival
statute at the time provided:
"'All actions and causes of action on contract,
express or implied, and all personal actions, except
for injuries to the reputation, survive in favor of
and against personal representatives; and all
personal causes of action survive against the
personal representative of a deceased tort feasor.'"
276 Ala. at 205, 160 So. 2d at 488–89 (emphasis omitted). The
Court applied the plain language of the statute and held that
the cause of action did not survive. In doing so, the Court
10
1160474
reiterated that, "[i]f there is a manifest injustice in not
providing for the survival of causes of action, such as the
one before us, that is a matter for remedy by the legislature
and not this court." McDowell, 276 Ala. at 205, 160 So. 2d at
489. See also Carroll v. Florala Mem'l Hosp., Inc., 288 Ala.
118, 120-21, 257 So. 2d 837, 838 (1972), overruled on other
grounds by King v. National Spa & Pool Inst., Inc., 607 So. 2d
1241 (Ala. 1992) ("The effect of the [1951] amendment [to the
survival statute] was considered in McDowell v. Henderson
Mining Co., 276 Ala. 202, 160 So. 2d 486 [(1963)], and this
court again held that personal cause[s] of action did not
survive in favor of personal representatives. And we further
held that if a remedy was necessary it was a matter for the
Legislature and not this court."). Thus, it is settled that
it is the province of the legislature to choose which
categories of causes of action and actions to include within
the operation of the survival statute. Shelton has not
demonstrated that the legislature's decision to alter the
common law so as to provide for the survival of some actions
and causes of action but not others violates § 13 of the
Alabama Constitution.
11
1160474
Shelton also argues that the legislature's failure to
include unfiled tort claims within the scope of § 6-5-462
violates the equal-protection and due-process guarantees of
the Fourteenth Amendment to the United States Constitution.
She points to authority standing for the proposition that
legislation that infringes upon "fundamental rights" is
subject to strict scrutiny, and she asserts that § 6-5-462
infringes upon such a fundamental right, which she describes
as "access to courts" and "civil justice." Shelton argues in
the alternative that, if strict scrutiny is not applicable,
this Court should still hold § 6-5-462 unconstitutional
because, she says, "no grounds can be conceived to justify"
treating holders of unfiled tort claims differently. See
generally Blevins v. Chapman, 47 So. 3d 227, 231 (Ala. 2010)
(indicating that legislation that affects similarly situated
people differently, but does not burden a suspect class or
infringe upon fundamental rights, must be upheld unless it
creates classifications "based solely on reasons totally
unrelated to the pursuit of the State's goals and only if no
grounds can be conceived to justify them").
12
1160474
First, it is questionable whether Shelton preserved these
arguments in the trial court. In her response to Green's
motion for a judgment on the pleadings, Shelton relied almost
exclusively on § 13 of the Alabama Constitution and the
"arbitrary and capricious" analysis embraced in Lankford,
supra. Although she asserted that § 6-5-462 violates rights
protected by the Fourteenth Amendment, she did not discuss the
level of scrutiny to be applied pursuant to, or any authority
construing or applying, the Fourteenth Amendment.
Second, Shelton does not point to any authority expressly
holding that the Fourteenth Amendment (or any other
constitutional provision) prohibits state legislatures from
providing that filed tort claims survive the death of the
plaintiff but unfiled tort claims do not. In fact, the United
States Court of Appeals for the Eleventh Circuit suggested
otherwise in Estate of Gilliam ex rel. Waldroup v. City of
Prattville, 639 F.3d 1041 (11th Cir. 2011). Gilliam involved
a civil-rights claim brought by the estate of a decedent, who
allegedly had been subjected to excessive police force. The
decedent died of unrelated causes before the action was filed,
and the police-officer defendants argued that the cause of
13
1160474
action had abated with the decedent's death. The Eleventh
Circuit, holding that the excessive-force claim did not
survive the decedent's death, concluded that "Ala. Code
[1975,] § 6-5-462[,] is not inconsistent with the
Constitution
and laws of the United States." 639 F.3d at 1043. Shelton
has not attempted to distinguish Gilliam or to otherwise
respond to Green's argument that Gilliam disposes of
Shelton's
Fourteenth Amendment arguments. The trial court's judgment in
the present case is due to be affirmed.
AFFIRMED.
Stuart, C.J., and Parker, Wise, and Bryan, JJ., concur.
14 | November 9, 2017 |
7e1205dc-bbd6-4c92-8698-b57fe2f5c545 | Wilkes v. PCI Gaming Authority | N/A | 1151312 | Alabama | Alabama Supreme Court | REL: 09/29/2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
SPECIAL TERM, 2017
____________________
1151312
____________________
Casey Marie Wilkes and Alexander Jack Russell
v.
PCI Gaming Authority d/b/a Wind Creek Casino and Hotel
Wetumpka, and Poarch Band of Creek Indians
Appeal from Elmore Circuit Court
(CV-15-900057)
PER CURIAM.
Casey Marie Wilkes and Alexander Jack Russell appeal the
summary judgment entered by the Elmore Circuit Court in favor
of PCI Gaming Authority d/b/a Wind Creek Casino and Hotel
1151312
Wetumpka ("Wind Creek-Wetumpka"), and the Poarch Band of
Creek
Indians (hereinafter referred to collectively as "the tribal
defendants"),1 on negligence and wantonness claims asserted by
Wilkes and Russell seeking compensation for injuries they
received when an automobile driven by Wilkes was involved in
a collision with a pickup truck belonging to Wind Creek-
Wetumpka and being driven by Barbie Spraggins, an employee at
Wind Creek-Wetumpka. We reverse and remand.
I.
Spraggins began working as a facilities-management
administrator at Wind Creek-Wetumpka in November 2013.
During
the course of her employment, one of her supervisors reported
her to higher level management at least six times because she
smelled of alcohol while at work. On at least two occasions,
Spraggins was tested for alcohol as a result of those reports,
and a blood test taken on February 13, 2014, revealed that she
had a blood-alcohol content of .078 while at work. Spraggins
was
eventually
referred
to
an
employee-assistance program,
and
1The Poarch Band of Creek Indians is an Alabama Indian
tribe that owns PCI Gaming Authority and Wind Creek-Wetumpka.
PCI Gaming Authority operates Wind Creek-Wetumpka.
2
1151312
she saw a counselor in conjunction with that program from
March through September 2014.
The record indicates that, on January 1, 2015, Spraggins
arrived for work at approximately 8:00 a.m. after drinking
much of the night. At some point after arriving at work, she
decided to travel to a warehouse maintained by Wind Creek-
Wetumpka approximately 10 miles away in Montgomery to
retrieve
lamp shades that were needed for some hotel rooms at Wind
Creek-Wetumpka. Spraggins was authorized to use a Wind Creek-
Wetumpka vehicle for such purposes, and she took a 2008
Chevrolet Silverado pickup truck on that occasion. It is
unclear exactly where Spraggins traveled after picking up the
lamp shades at the Montgomery warehouse; however, at
approximately 10:50 a.m., the pickup truck she was driving
struck a guardrail while crossing the Mortar Creek bridge on
Alabama State Highway 14 outside of Elmore, crossed into
oncoming traffic, and was involved in a head-on collision with
a vehicle being driven by Wilkes. Spraggins, Wilkes, and
Russell, a passenger in Wilkes's vehicle, were all
transported
to the Baptist Medical Center South hospital in Montgomery for
medical treatment following the accident, and a blood test
3
1151312
administered at the hospital revealed that Spraggins had a
blood-alcohol content of .293 approximately 1 hour and 45
minutes after the collision. Spraggins has since been unable
to recall why she was traveling on the Mortar Creek bridge at
the time of the collision; that location is approximately
eight miles west of Wind Creek-Wetumpka and not on the route
to the warehouse where she picked up the lamp shades.
On February 16, 2015, Wilkes and Russell sued Spraggins
and the tribal defendants in the Elmore Circuit Court.2 As
subsequently amended, Wilkes and Russell's complaint asserted
negligence and wantonness claims against Spraggins and the
tribal defendants based on Spraggins's operation of
the
pickup
truck at the time of the January 2015 accident, and negligence
and wantonness claims against the tribal defendants based on
their hiring, retention, and supervision of Spraggins.3
Following a period of discovery, the tribal defendants moved
the trial court to enter a summary judgment in their favor,
2Progressive
Specialty
Insurance
Company,
Wilkes's
insurer, was also named as a defendant. It is not a party to
this appeal.
3Spraggins's employment at Wind Creek-Wetumpka was
terminated before she could return to work following the
January 2015 accident.
4
1151312
arguing that the Poarch Band of Creek Indians was a federally
recognized Indian tribe and that they were accordingly
protected by the doctrine of tribal sovereign immunity or,
alternatively, that Spraggins was not acting within the scope
of her employment at the time of the January 2015 accident.
Wilkes and Russell opposed the tribal defendants' summary-
judgment motion; however, on June 7, 2016, the trial court
granted the tribal defendants' motion and entered a summary
judgment in their favor, holding that it
lacked subject-matter
jurisdiction over the dispute because of the tribal sovereign
immunity held by the tribal defendants. On August 10, 2016,
the trial court certified its judgment as final pursuant to
Rule 54(b), Ala. R. Civ. P., and, on September 20, 2016,
Wilkes and Russell filed their notice of appeal to this Court.
II.
Wilkes and Russell seek the reversal of the summary
judgment entered by the trial court holding that the tribal
defendants are protected from suit by the doctrine of tribal
sovereign immunity. This Court has stated:
"This Court's review of a summary judgment is de
novo. Williams v. State Farm Mut. Auto. Ins. Co.,
886 So. 2d 72, 74 (Ala. 2003). We apply the same
standard of review as the trial court applied.
5
1151312
Specifically, we must determine whether the movant
has made a prima facie showing that no genuine issue
of material fact exists and that the movant is
entitled to a judgment as a matter of law. Rule
56(c), Ala. R. Civ. P.; Blue Cross & Blue Shield of
Alabama v. Hodurski, 899 So. 2d 949, 952-53 (Ala.
2004). In making such a determination, we must
review the evidence in the light most favorable to
the nonmovant. Wilson v. Brown, 496 So. 2d 756, 758
(Ala. 1986). Once the movant makes a prima facie
showing that there is no genuine issue of material
fact, the burden then shifts to the nonmovant to
produce 'substantial evidence' as to the existence
of a genuine issue of material fact. Bass v.
SouthTrust Bank of Baldwin County, 538 So. 2d 794,
797-98 (Ala. 1989); Ala. Code 1975, § 12-21-12."
Dow v. Alabama Democratic Party, 897 So. 2d 1035, 1038-39
(Ala. 2004).
III.
The issue presented in this appeal is whether the
doctrine of tribal sovereign immunity shields the tribal
defendants from the tort claims asserted by Wilkes and
Russell. In Michigan v. Bay Mills Indian Community, ___ U.S.
___, ___, 134 S. Ct. 2024, 2030-31 (2014), the Supreme Court
of the United States explained tribal sovereign immunity as
follows:
"Indian
tribes
are
'"domestic
dependent
nations"'
that
exercise
'inherent
sovereign
authority.' Oklahoma Tax Comm'n v. Citizen Band
Potawatomi Tribe of Okla., 498 U.S. 505, 509 (1991)
(Potawatomi) (quoting Cherokee Nation v. Georgia, 5
6
1151312
Pet. 1, 17 (1831)). As dependents, the tribes are
subject to plenary control by Congress. See United
States v. Lara, 541 U.S. 193, 200 (2004) ('[T]he
Constitution grants Congress' powers 'we have
consistently described as "plenary and exclusive"'
to 'legislate in respect to Indian tribes'). And
yet they remain 'separate sovereigns pre-existing
the Constitution.' Santa Clara Pueblo v. Martinez,
436 U.S. 49, 56 (1978). Thus, unless and 'until
Congress acts, the tribes retain' their historic
sovereign authority. United States v. Wheeler, 435
U.S. 313, 323 (1978).
"Among the core aspects of sovereignty that
tribes possess –- subject, again, to congressional
action –- is the 'common-law immunity from suit
traditionally enjoyed by sovereign powers.' Santa
Clara Pueblo, 436 U.S., at 58. That immunity, we
have explained, is 'a necessary corollary to Indian
sovereignty and self-governance.' Three Affiliated
Tribes of Fort Berthold Reservation v. Wold
Engineering, P.C., 476 U.S. 877, 890 (1986); cf. The
Federalist No. 81, p. 511 (B. Wright ed. 1961) (A.
Hamilton) (It is 'inherent in the nature of
sovereignty not to be amenable' to suit without
consent). And the qualified nature of Indian
sovereignty modifies that principle only by placing
a tribe's immunity, like its other governmental
powers and attributes, in Congress's hands. See
United States v. United States Fidelity & Guaranty
Co., 309 U.S. 506, 512 (1940) (USF & G) ('It is as
though the immunity which was theirs as sovereigns
passed to the United States for their benefit').
Thus, we have time and again treated the 'doctrine
of tribal immunity [as] settled law' and dismissed
any suit against a tribe absent congressional
authorization (or a waiver). Kiowa Tribe of Okla.
v. Manufacturing Technologies, Inc., 523 U.S. 751,
756 (1998)."
7
1151312
However, notwithstanding the fact that the doctrine of tribal
sovereign immunity is generally considered to be settled law,
the Supreme Court of the United States has recognized that the
doctrine is a common-law doctrine that "developed almost by
accident,"
Kiowa
Tribe
of
Oklahoma
v.
Manufacturing
Technologies, Inc., 523 U.S. 751, 756 (1998), inasmuch as
there is no congressional statute or treaty defining the
doctrine and, importantly, what, if any, limits the doctrine
may have. Although the principle that tribes have the power
"to make their own substantive law in internal matters ... and
to enforce that law in their own forums" is relatively clear
and accepted, Santa Clara Pueblo v. Martinez, 436 U.S. 49, 55-
56 (1978), the application of the doctrine of tribal sovereign
immunity becomes murkier when tribes interact with those who
are not members of the tribes. See New Mexico v. Mescalero
Apache Tribe, 462 U.S. 324, 332 (1983) (stating that "[a]
tribe's power to prescribe the conduct of tribal members has
never been doubted").
In the absence of any foundational statute or treaty, it
has accordingly been left to the Supreme Court of the United
States to define the limits of tribal sovereign immunity in
8
1151312
situations where tribal and non-tribal members interact,
although that Court has repeatedly expressed its willingness
to defer to Congress should Congress act in this arena. See,
e.g., Bay Mills, ___ U.S. at ___, 134 S.Ct. at 2037 ("[I]t is
fundamentally Congress's job, not ours, to determine whether
or how to limit tribal immunity."), and Kiowa, 523 U.S. at 759
("Although the Court has taken the lead in drawing the bounds
of tribal immunity, Congress, subject to constitutional
limitations,
can
alter
its
limits
through
explicit
legislation."). In Kiowa, the Court extended the tribal-
sovereign-immunity doctrine to shield tribes from lawsuits
asserting contract claims based on commercial activities
conducted outside tribal lands; however, the Court for the
first time also expressed its reservations about perpetuating
the doctrine, explaining:
"There are reasons to doubt the wisdom of
perpetuating the doctrine. At one time, the
doctrine of tribal immunity from suit might have
been thought necessary to protect nascent tribal
governments from encroachments by States. In our
interdependent and mobile society, however, tribal
immunity extends beyond what is needed to safeguard
tribal self-governance. This is evident when tribes
take part in the Nation's commerce. Tribal
enterprises now include ski resorts, gambling, and
sales of cigarettes to non-Indians. See Mescalero
Apache Tribe v. Jones, 411 U.S. 145 (1973);
9
1151312
[Oklahoma Tax Comm'n v. Citizen Band of] Potawatomi
[Indian Tribe of Oklahoma, 498 U.S. 505, 510
(1991)]; Seminole Tribe of Fla. v. Florida, 517 U.S.
44 (1996). In this economic context, immunity can
harm those who are unaware that they are dealing
with a tribe, who do not know of tribal immunity, or
who have no choice in the matter, as in the case of
tort victims.
"These considerations might suggest a need to
abrogate tribal immunity, at least as an overarching
rule. Respondent does not ask us to repudiate the
principle outright, but suggests instead that we
confine it to reservations or to noncommercial
activities. We decline to draw this distinction in
this case, as we defer to the role Congress may wish
to exercise in this important judgment.
"....
"In light of these concerns, we decline to
revisit our case law and choose to defer to
Congress. Tribes enjoy immunity from suits on
contracts,
whether
those
contracts
involve
governmental or commercial activities and whether
they were made on or off a reservation. Congress
has not abrogated this immunity, nor has petitioner
waived it, so the immunity governs this case."
523 U.S. at 758-60 (emphasis added).
We take particular notice of the Court's comment that
tribal sovereign immunity hurts most those who "have no choice
in the matter" and its concomitant holding refusing to extend
the tribal sovereign immunity that tribes enjoy beyond "suits
on contracts." Id. In Bay Mills, the Supreme Court further
recognized this refusal, explaining in a footnote that it had
10
1151312
never "specifically addressed (nor, so far as we are aware,
has Congress) whether immunity should apply in the ordinary
way if a tort victim, or other plaintiff who has not chosen to
deal with a tribe, has no alternative way to obtain relief for
off-reservation commercial conduct." ___ U.S. at ___ n. 8,
134 S.Ct. at 2036 n. 8. This appeal presents precisely that
scenario: Wilkes and Russell have alleged tort claims against
the tribal defendants, and they have no way to obtain relief
if the doctrine of tribal sovereign immunity is applied to bar
their lawsuit.
In light of the fact that the Supreme Court of the United
States has expressly acknowledged that it has never applied
tribal sovereign immunity in a situation such as this, we
decline to extend the doctrine beyond the circumstances to
which that Court itself has applied it; accordingly, we hold
that the doctrine of tribal sovereign immunity affords the
tribal defendants no protection from the claims asserted by
Wilkes and Russell. As Justice Stevens aptly explained in his
dissent in Kiowa, a contrary holding would be contrary to the
interests of justice, especially inasmuch as the tort victims
in this case had no opportunity to negotiate with the tribal
11
1151312
defendants for a waiver of immunity. See Kiowa, 523 U.S. at
766 (Stevens, J., dissenting) ("[T]he rule [set forth by the
majority] is unjust. This is especially so with respect to
tort victims who have no opportunity to negotiate for a waiver
of sovereign immunity; yet nothing in the Court's reasoning
limits the rule to lawsuits arising out of voluntary
contractual relationships. Governments, like individuals,
should pay their debts and should be held accountable for
their unlawful, injurious conduct.").
Wilkes and Russell did not voluntarily choose to engage
in a transaction with the tribal defendants; rather, they were
merely traveling on the public roads of this State when they
were injured in an automobile accident involving –– and, by
all accounts, caused by –– a Wind Creek-Wetumpka employee
driving a Wind Creek-Wetumpka vehicle. Thus, to the extent
the Bay Mills Court buttressed its decision affording tribal
sovereign immunity to tribes with regard to claims stemming
from a tribe's commercial activities by reasoning that
plaintiffs could "bargain for a waiver of immunity"
beforehand, ___ U.S. at ___, 134 S.Ct. at 2035, that rationale
has no application to the tort claims asserted by Wilkes and
12
1151312
Russell. Moreover, for the reasons explained by Justice
Thomas in his dissent in Bay Mills, we likewise conclude that
none of the other rationales offered by the majority in Bay
Mills as support for continuing to apply the doctrine of
tribal
sovereign
immunity
to
tribes'
off-reservation
commercial activities sufficiently outweigh the interests of
justice so as to merit extending that doctrine to shield
tribes from tort claims asserted by individuals who have no
personal or commercial relationship to the tribe. See Bay
Mills, ___ U.S. at ___, 134 S.Ct. at 2045-55 (Thomas, J.,
dissenting) (explaining that the doctrine of tribal sovereign
immunity as articulated by the Supreme Court in Kiowa lacks
"substantive justification" and the majority's reasons for
continuing to uphold the doctrine –– deference to Congress,
stare decisis, etc. –– are insufficient in light of that lack
of a justification, and the "unfairness and conflict it has
engendered").
IV.
Wilkes and Russell asserted negligence and wantonness
claims against the tribal defendants as a result of injuries
sustained in an automobile accident involving a vehicle owned
13
1151312
by Wind Creek-Wetumpka and being driven by a Wind Creek-
Wetumpka employee. The trial court entered a summary judgment
in favor of the tribal defendants on the ground of tribal
sovereign immunity, and Wilkes and Russell appealed that
judgment to this Court. We now reverse the judgment of the
trial court and hold that the doctrine of tribal sovereign
immunity affords no protection to tribes with regard to tort
claims asserted against them by non-tribe members. In so
holding, we are mindful that "tribal immunity is a matter of
federal law and is not subject to diminution by the States,"
Kiowa, 523 U.S. at 756, and that our holding is contrary to
the holdings of several of the United States Courts of Appeals
that have considered this issue. See, e.g., Arizona v. Tohono
O'odham Nation, 818 F.3d 549, 563 n. 8 (9th Cir. 2016) ("We
have held that tribal sovereign immunity bars tort claims
against an Indian tribe, and that remains good law.").
However, as explained supra, the Supreme Court of the United
States has expressly acknowledged that it has not ruled on the
issue whether the doctrine of tribal sovereign immunity has a
field of operation with regard to tort claims, and this Court
is not bound by decisions of lower federal courts. See Ex
14
1151312
parte Johnson, 993 So. 2d 875, 886 (Ala. 2008) ("This Court is
not bound by decisions of the United States Courts of Appeals
or the United States District Courts ...."), and Preferred
Risk Mut. Ins. Co. v. Ryan, 589 So. 2d 165, 167 n. 2 (Ala.
1991) ("Decisions of federal courts other than the United
States Supreme Court, though persuasive, are not binding
authority on this Court."). Accordingly, in the interest of
justice we respectfully decline to extend the doctrine of
tribal sovereign immunity beyond the circumstances in which
the Supreme Court of the United States itself has applied it.
The judgment of the trial court holding that it lacked
jurisdiction to consider the claims asserted by Wilkes and
Russell based on the doctrine of tribal sovereign immunity is
accordingly reversed and the cause remanded for further
proceedings consistent with this opinion.
REVERSED AND REMANDED.
Stuart, C.J., and Bolin, Parker, Murdock, Main, Bryan,
and Sellers, JJ., concur.
Shaw and Wise, JJ., recuse themselves.
15 | September 29, 2017 |
1cdcbba1-c8ee-43bb-9b6e-e03f2a00bac4 | Walker Brothers Investment, Inc. v. City of Mobile | N/A | 1160203 | Alabama | Alabama Supreme Court | Rel: 09/15/2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
SPECIAL TERM, 2017
____________________
1160203
____________________
Walker Brothers Investment, Inc., and James Walker
v.
City of Mobile, Mobile Historic Development Commission, and
Architectural Review Board of the City of Mobile
Appeal from Mobile Circuit Court
(CV-12-901596)
BRYAN, Justice.
Walker Brothers Investment, Inc., and James Walker
(hereinafter referred to collectively as "Walker Brothers")
appeal from an order entered by the Mobile Circuit Court
1160203
granting a motion for a summary judgment filed by the City of
Mobile ("the City"). In response to a motion to clarify that
its summary-judgment order applied to the Mobile Historic
Development Commission ("the HDC") and the Architectural
Review Board of the City of Mobile ("the Board"), the circuit
court entered an order stating that those agencies "were not
properly added to this lawsuit" and dismissing the complaint
and the counterclaims.1 For the reasons set forth herein, we
dismiss the appeal.
Procedural History
On July 26, 2012, the City filed a complaint against
Walker Brothers seeking a preliminary and a permanent
injunction. In its complaint, the City alleged that Walker
Brothers owned a building, known as the Tobin Building,
located in a historic district in downtown Mobile and that
Walker Brothers had allowed the building to deteriorate in
violation of the Mobile City Code; the City asked the circuit
court to enter an order requiring Walker Brothers to
1The issue whether the HDC and the Board were actually
parties below is not relevant to the issue we address on
appeal.
2
1160203
"mothball"2 the Tobin Building in accordance with plans
submitted by Walker Brothers and subsequently approved by the
Board on November 16, 2011. On August 7, 2012, the circuit
court set the City's request for a preliminary injunction for
a hearing on September 5, 2012; the circuit court took some
testimony at that hearing but continued the remainder of the
hearing until September 12, 2012.
On September 11, 2012, the City filed a motion to
dismiss, alleging that, since the filing of their complaint,
Walker Brothers had mothballed the Tobin Building as the City
had requested. The City stated that "there no longer exists
a justiciable controversy" between the parties, and it asked
the court to "enter an order finding that the case has become
moot and that [the City]'s complaint be dismissed without
prejudice."
Later on September 11, 2012, Walker Brothers filed an
answer to the City's complaint and a counterclaim alleging
"unequal and unfair enforcement of applicable laws." Walker
Brothers argued that the City, through the HDC and the Board,
2According to the City's complaint, "mothballing provides
protection to the building and the public until an owner is
willing or able to do the necessary restoration and
maintenance."
3
1160203
had treated Walker Brothers unequally from other developers of
historic properties, and it alleged that the City had engaged
in selective enforcement of the City's rules and regulations
in a manner that "amounted to malicious prosecution and abuse
of process." The same day, Walker Brothers also filed an
objection to the City's motion to dismiss, stating that it had
intentionally left part of the mothballing plan uncomplete so
that it could file a counterclaim against the City. The
circuit court purported to grant the City's motion to dismiss
later the same day.
Still on September 11, 2012, Walker Brothers filed a
motion to reconsider the circuit court's order dismissing the
City's complaint. On October 11, 2012, the City filed an
affidavit from Devereaux Bemis, the director of the HDC, in
"support" of its motion to dismiss. Bemis testified that from
September 5 through September 11 Walker Brothers had
voluntarily mothballed the Tobin Building and, after he
inspected the property on September 11, he determined that
Walker
Brothers
had
"substantially
and
satisfactorily
mothballed the buildings in accordance with plans submitted"
by Walker Brothers as requested in the City's complaint.
4
1160203
On October 12, 2012, the circuit court entered an order
granting Walker Brothers' motion to reconsider its order
dismissing the City's complaint; the circuit court stated that
Walker
Brothers'
counterclaim
was
"reinstated and
[the
City]'s
motion to dismiss is granted without prejudice."
Walker Brothers subsequently obtained leave of the
circuit court to file an amended counterclaim, which it did on
March 12, 2013. In its amended counterclaim, Walker Brothers
reasserted the claim raised in its original counterclaim and
added a claim against the City, the HDC, the Board, and
several fictitiously named parties. In this second claim,
Walker Brothers alleged that the actions of the City, the HDC,
and
the
Board
in
interpreting
and
enforcing
rules,
regulations, and ordinances were arbitrary, capricious, and
discriminatory against
Walker
Brothers
and
that
those
actions,
it said, "violated the equal protection clause of the Alabama
and United States Constitutions." The City, the HDC, and the
Board filed a joint answer to the amended counterclaim on
March 26, 2013.
The City filed a motion for a summary judgment, arguing
that Walker Brothers could not prevail on its selective-
5
1160203
enforcement equal-protection claim because, it said, Walker
Brothers was not, nor did it allege to be, a member of a
suspect class. After Walker Brothers filed a response and the
City, the HDC, and the Board replied, the circuit court
granted the City's summary-judgment motion.
The
circuit court
subsequently entered a series of orders clarifying that it had
ruled on each of Walker Brothers' counterclaims and that all
Walker Brothers' claims against all parties had been denied.
Walker Brothers timely appealed.
Jurisdiction
Initially, we must address a jurisdictional argument
raised by the City, the HDC, and the Board (hereinafter
referred to collectively as "the appellees"). The appellees
contend that the appeal is due to be dismissed because Walker
Brothers' counterclaim was filed after the City voluntarily
dismissed its complaint pursuant to Rule 41(a)(1)(i), Ala. R.
Civ. P., and the appellees contend that, therefore, the
circuit court lost power to take any further action in the
case, including considering Walker Brothers' counterclaim,
after the City filed its motion to dismiss on September 11,
2012. See generally Ex parte Sealy, L.L.C., 904 So. 2d 1230,
6
1160203
1236
(Ala.
2004)
(holding,
where
defendant
filed
a
counterclaim against the plaintiff after the plaintiff had
filed a notice of dismissal pursuant to Rule 41(a)(1)(i), that
the notice of dismissal filed by the plaintiff "deprived the
trial court of the power to proceed further with the action
and rendered all orders entered after its filing void"). Rule
41(a)(1) provides:
"(a) Voluntary Dismissal; Effect Thereof.
"(1) By Plaintiff; By Stipulation. Subject to
the provisions of Rule 23(e), of Rule 66, and of any
statute of this state, an action may be dismissed by
the plaintiff without order of court (i) by filing
a notice of dismissal at any time before service by
the adverse party of an answer or of a motion for
summary judgment, whichever first occurs, or (ii) by
filing a stipulation of dismissal signed by all
parties who have appeared in the action. Unless
otherwise stated in the notice of dismissal or
stipulation, the dismissal is without prejudice
...."
This Court discussed Rule 41(a)(1)(i) recently in Synovus
Bank v. Mitchell, 206 So. 3d 568 (Ala. 2016). In that case,
the plaintiff, Synovus Bank, filed a stipulation of dismissal,
purportedly pursuant to Rule 41(a)(1)(ii). However, because
the defendant had not served Synovus with an answer or a
motion for a summary judgment, this Court held that the
7
1160203
stipulation of dismissal satisfied Rule 41(a)(1)(i). In this
regard, the Court stated:
"Rule
41(a)(1)(i)
expressly
provides
that
a
plaintiff need only file with the court a notice of
dismissal to dismiss his or her action if the
defendant has not served the plaintiff with an
answer or a motion for a summary judgment. Such
notice of dismissal, once filed with the court,
automatically dismisses the action; no subsequent
order of the court is required. Riverstone [Dev. Co.
v. Nelson], 91 So. 3d [678,] 681 [(Ala. 2012)] ('If
the conditions of Rule 41(a)(1) are satisfied,
dismissal is automatic, that is, "[n]o order of the
court
is
required....
[and]
the
notice
[of
dismissal] terminates the action...."' (quoting 9
Charles Alan Wright & Arthur R. Miller, Federal
Practice and Procedure § 2363, at 439–41 (3d ed.
2008))). In this case, it is undisputed that [the
defendant] never filed an answer or a motion for a
summary judgment. Thus, in order to dismiss the
action, Synovus needed only to file with the trial
court notice that it desired to dismiss the action;
neither [the defendant]'s consent nor a court order
was required.
"Although Rule 41(a)(1)(i) states that a
plaintiff may dismiss an action by filing a 'notice
of dismissal,' the rule does not prescribe specific,
technical requirements for the form of that notice.
In Reid v. Tingle, 716 So. 2d 1190 (Ala. Civ. App.
1997), the Court of Civil Appeals held that a letter
written
from
the
plaintiff
to
her
attorney
instructing the attorney to '"dismiss this lawsuit
immediately"'
met
the
requirements
of
Rule
41(a)(1)(i) 'in that it [gave] notice of the
plaintiff's desire to dismiss the action, and it was
filed with the clerk's office.' 716 So. 2d at
1192–93. The United States Court of Appeals for the
Eleventh Circuit has held that a filing styled as a
'motion to dismiss' that indicated that the
8
1160203
plaintiff would refile the action in state court
constituted a notice of dismissal for purposes of
Rule 41(a)(1)(A)(i), Fed. R. Civ. P., which is
substantially similar to our own Rule 41(a)(1)(i).
Matthews v. Gaither, 902 F.2d 877, 880 (11th Cir.
1990). Thus, it is the substance, not the style, of
a plaintiff's notice that triggers an automatic
dismissal under Rule 41(a)(1)(i)."
Synovus, 206 So. 3d at 570–71 (footnote omitted).
This Court has held that a dismissal pursuant to "'Rule
41(a)(1) affords the plaintiff an unqualified right to
dismiss' its action before the filing of an answer or a
summary-judgment motion." Ex parte Sealy, 904 So. 2d at 1235
(quoting Clement v. Merchants Nat'l Bank of Mobile, 493 So. 2d
1350, 1353 (Ala. 1986)). Further, a plaintiff may cause an
automatic dismissal of
its
action pursuant to Rule 41(a)(1)(i)
even when, as in this case, the defendant has "appeared"
before the circuit court. See Synovus, 206 So. 3d at 569
(noting that the defendant filed a motion to dismiss and a
response to a summary-judgment motion filed by Synovus before
Synovus acted to dismiss its complaint pursuant to Rule
41(a)(1)(i)); and Ex parte Sealy, supra (noting that the
defendant moved to strike portions of the plaintiff's amended
complaint, requested an award of attorney fees, and appeared
9
1160203
at a hearing before the plaintiff successfully moved to
dismiss its action pursuant to Rule 41(a)(1)(i)).
In the present case, although Walker Brothers had
appeared
at
the
preliminary-injunction hearing
on
September
5,
2012, the record unequivocally establishes that Walker
Brothers had not served an answer pursuant to Rule 5(e), Ala.
R. Civ. P., or a motion for a summary judgment before the City
filed its "motion" to dismiss. Although the City's filing was
styled as a motion to dismiss and asked the circuit court to
dismiss the action because it was moot, the motion clearly
provided notice to the circuit court of the City's "desire[]
to dismiss the action." Synovus, 206 So. 3d at 571.
Accordingly, because this motion met the requirements of Rule
41(a)(1)(i) and clearly indicated the City's desire to
dismiss
the
action,
the
motion
acted
to
"immediately
and
automatically"
terminate
the
action
pursuant
to
Rule
41(a)(1)(i), and the circuit court's order "dismissing" the
City's action was not required. Id.
"The effect of a notice of dismissal pursuant to
Rule 41(a)(1) was succinctly explained in Reid v.
Tingle, 716 So. 2d 1190, 1193 (Ala. Civ. App. 1997).
There, the Court of Civil Appeals said:
10
1160203
"'A voluntary dismissal under Ala. R.
Civ. P. 41 terminates the action when the
notice of the plaintiff's intent to dismiss
is filed with the clerk. See ... Hammond v.
Brooks, 516 So. 2d 614 (Ala. 1987). The
committee comments to Rule 41, Ala. R. Civ.
P., note that the rule is "substantially
the same as the corresponding federal
rule." See Ala. R. Civ. P. 41, Committee
Comments on 1973 Adoption. In interpreting
F. R. Civ. P. 41(a)(1), the Fifth Circuit
stated:
"'"Rule
41(a)(1)
is
the
shortest and surest route to
abort a complaint when it is
applicable. So long as plaintiff
has not been served with his
adversary's answer or motion for
summary judgment he need do no
more than file a notice of
dismissal with the Clerk. That
document itself closes the file.
There is nothing the defendant
can do to fan the ashes of that
action into life and the court
has no role to play. This is a
matter of right running to the
plaintiff
and
may
not
be
extinguished or circumscribed by
adversary or court. There is not
even a perfunctory order of court
closing the file. Its alpha and
omega was the doing of the
plaintiff alone."
"'American Cyanamid Co. v. McGhee, 317 F.2d
295, 297 (5th Cir. 1963).'
"716 So. 2d at 1193 ....
11
1160203
"Although cases involving a Rule 41(a)(1)
dismissal 'are not perfectly analogous to cases in
which
the
...
court
lacks
subject
matter
jurisdiction, both contexts present the question of
the court's continuing power over litigants who do
not, or no longer, have a justiciable case before
the court.' Chemiakin v. Yefimov, 932 F.2d 124, 128
(2d Cir. 1991). Thus, it is sometimes stated that a
Rule 41(a)(1) dismissal deprives the trial court of
'jurisdiction' over the 'dismissed claims.' Duke
Energy Trading & Mktg., L.L.C. v. Davis, 267 F.3d
1042, 1049 (9th Cir. 2001); see Safeguard Business
Sys., Inc. v. Hoeffel, 907 F.2d 861, 864 (8th Cir.
1990); see also Gambale v. Deutsche Bank AG, 377
F.3d 133, 139 (2d Cir. 2004); Netwig v. Georgia
Pacific Corp., 375 F.3d 1009, 1011 (10th Cir. 2004);
Meinecke v. H & R Block of Houston, 66 F.3d 77, 82
(5th Cir. 1995); Williams v. Ezell, 531 F.2d 1261,
1264 (5th Cir. 1976) ('The court had no power or
discretion to deny plaintiffs' right to dismiss or
to attach any condition or burden to that right.
That was the end of the case and the attempt to deny
relief on the merits and dismiss with prejudice was
void.').
"Similarly stated, '[t]he effect of a voluntary
dismissal without prejudice is to render the
proceedings a nullity and leave the parties as if
the action had never been brought.' In re Piper
Aircraft Distrib. Sys. Antitrust Litig., 551 F.2d
213, 219 (8th Cir. 1977)."
Ex parte Sealy, 904 So. 2d at 1235-36 (some emphasis omitted;
some emphasis added). Stated differently, the effect of a
plaintiff's voluntary dismissal pursuant to Rule 41(a)(1)(i)
is that it "'ipso facto deprived the trial court of the power
to proceed further with the action and rendered all orders
12
1160203
entered after its filing void.'" Synovus, 206 So. 3d at 571
(quoting Sealy, 904 So. 2d at 1236).
In light of the foregoing, we must consider what effect,
if any, Walker Brothers' "motion to reconsider" had in
reinstating the City's complaint so as to allow the circuit
court to consider Walker Brothers' counterclaims.
In
Synovus,
this Court held that, after Synovus's action was voluntarily
dismissed pursuant to Rule 41(a)(1)(i), the trial court
retained limited authority to consider a Rule 60(b), Ala. R.
Civ. P., motion filed by Synovus to set aside its voluntary
notice of dismissal. We noted that the Committee Comments to
Rule 41 expressly provide that "'[a] dismissal, whether
voluntary or involuntary, may be set aside by the court, like
any other judgment, on proper motion under Rule 60(b),'" and
we further noted that this provision was in accord with the
"majority of federal circuits when considering whether a
voluntary dismissal pursuant to Rule 41(a)(1)(A), Fed. R.
Civ.
P., can be set aside by a motion filed pursuant to Rule 60(b),
Fed. R. Civ. P., both of which are substantially similar,
respectively, to our own Rule 41(a)(1) and Rule 60(b)."
Synovus, 206 So. 3d at 571-72. The Committee Comments to Rule
13
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41, Ala. R. Civ. P., also indicate that a "rehearing may be
requested under Rule 59(a)(2)[, Ala. R. Civ. P.,]" after a
voluntary dismissal.3
Motions filed pursuant to Rule 60(b) and Rule 59,
however, may be filed only in reference to a final judgment.
See Jackson v. Sasser, 158 So. 3d 469, 470 n. 2 and 3 (Ala.
Civ. App. 2014). In Synovus, Synovus specifically requested
a dismissal of its claims with prejudice. See Synovus, 206 So.
3d at 571 ("[B]ecause the stipulation of dismissal expressly
indicates Synovus's desire to dismiss the action with
prejudice, the dismissal operated to that effect."); and Rule
41(a)(1) (indicating that a voluntary dismissal is without
prejudice "[u]nless otherwise stated in the notice of
dismissal or stipulation"). In the present case, the City did
not state otherwise; therefore, the City's complaint was
dismissed without prejudice. See Palughi v. Dow, 659 So. 2d
112, 113 (Ala. 1995) (dismissing an appeal taken from an order
that dismissed the plaintiff's action without prejudice
3Rule 59(a)(2) provides that "[a] new trial may be granted
to all or any of the parties and ... (2) on all or part of the
issues in an action tried without a jury, for any of the
reasons for which rehearings have heretofore been granted in
suits in equity in the courts of Alabama."
14
1160203
because the order was not a final judgment that would support
an appeal). In R.E. Grills, Inc. v. Davison, 641 So. 2d 225
(Ala. 1994), after the plaintiff's action was voluntarily
dismissed without prejudice, this Court held that a "motion to
reinstate," filed by the plaintiff six and one-half months
later, could "be construed only as a Rule 60(b) motion to set
aside a Rule 41(a)(2)[, Ala. R. Civ. P.,4] order of voluntary
dismissal." 641 So. 2d at 227. Thus, although this Court did
not discuss the question directly, it appears that the Court
assumed that a voluntary dismissal without prejudice was
sufficiently final to support a motion filed pursuant to Rule
60(b).
That conclusion is in accord with a majority of federal
circuits that have directly considered this question. In Yesh
Music v. Lakewood Church, 727 F.3d 356 (5th Cir. 2013), the
United States Court of Appeals for the Fifth Circuit discussed
the question "whether a voluntary dismissal without prejudice
[pursuant to Rule 41(a)(1)(A)(i), Fed. R. Civ. P.,] can be a
'final judgment, order, or proceeding' within the meaning of
4Rule 41(a)(2) provides for a voluntary dismissal of a
plaintiff's action by order of the court if the plaintiff
cannot meet the requirements of Rule 41(a)(1).
15
1160203
Rule 60(b)[, Fed. R. Civ. P.]." 727 F.3d at 360. The court
considered cases from the United States Courts of Appeals for
the Third and Seventh Circuits that specifically held that a
dismissal
without
prejudice
was
a
sufficiently
final
proceeding so as to allow for a motion seeking relief pursuant
to Rule 60(b), see Williams v. Frey, 551 F.2d 932, 934-35 (3d
Cir. 1977), and Nelson v. Napolitano, 657 F.3d 586, 589 (7th
Cir. 2011); the court also noted that the United States Courts
of Appeals for the Ninth and Tenth Circuits had "also broadly
found that a voluntary dismissal 'is a judgment, order, or
proceeding from which Rule 60(b) relief can be granted,'"
without distinguishing between actions dismissed with or
without prejudice. Yesh Music, 727 F.3d at 361 (quoting In re
Hunter, 66 F.3d 1002, 1004-05 (9th Cir. 1995)). See also Smith
v. Phillips, 881 F.2d 902, 904 (10th Cir. 1989) ("'An
unconditional
dismissal
terminates
federal
jurisdiction
except
for the limited purpose of reopening and setting aside the
judgment of dismissal within the scope allowed by [Fed. R.
Civ. P.,] Rule 60(b).'" (quoting McCall-Bey v. Franzen, 777
F.2d 1178, 1190 (7th Cir. 1985))). The court went on to state:
"In
addition,
the
Fourth
Circuit,
Sixth
Circuit,
and Supreme Court have all found that when a claim
16
1160203
is voluntarily dismissed pursuant to a Rule
41(a)(1)(A)(ii) stipulated dismissal, the court
retains the ability to vacate the stipulated
dismissal under Rule 60(b)(6). See Kokkonen v.
Guardian Life Ins. Co. of Am., 511 U.S. 375, 381–82,
114 S. Ct. 1673, 128 L. Ed. 2d 391 (1994); Fairfax
Countywide Citizens Ass'n v. Fairfax County, Va.,
571 F.2d 1299, 1302–03 (4th Cir. 1978); Aro Corp. v.
Allied Witan Co., 531 F.2d 1368, 1371 (6th Cir.
1976).
Stipulated
dismissals
under
Rule
41(a)(1)(A)(ii), like unilateral dismissals under
Rule 41(a)(1)(A)(i), require no judicial action or
approval and are effective automatically upon
filing. Moreover, stipulated dismissals are also
presumptively without prejudice, and so these courts
have impliedly determined that a voluntary dismissal
without prejudice is a final proceeding subject to
vacatur
under
Rule
60(b).
Because
stipulated
dismissals are no more 'final' than unilateral
dismissals, nor do they require any more judicial
intervention, it would be anomalous to call the
former a 'final proceeding' while insisting that the
latter is not."
Yesh Music, 727 F.3d at 361–62 (footnote omitted).
Accordingly, we conclude that the City's voluntary
dismissal without prejudice was sufficiently final to support
a motion filed pursuant to Rule 59(a) or Rule 60(b), Ala. R.
Civ. P. Thus, we must now consider whether Walker Brothers,
as the defendants, had the ability to file such a motion in an
attempt to "fan the ashes of [the City's] action to life" in
light of the "right running to [the City]" to voluntarily
dismiss its action pursuant to Rule 41(a)(1)(i). American
17
1160203
Cyanamid Co. v. McGhee, 317 F.2d 295, 297 (5th Cir. 1963). In
each of the cases cited above holding that a trial court has
the ability to consider a motion filed pursuant to Rule 60(b)
to reopen a case that has been voluntarily dismissed by the
plaintiff pursuant to Rule 41(a)(1)(i) or its federal
equivalent, the plaintiff was the party seeking to reopen the
action it had previously voluntarily dismissed. In the
present case, we have the unusual circumstance of the
defendants seeking to have the plaintiff's case against them
reinstated for the sole purpose of filing a counterclaim
against the plaintiff.
Although this Court has never considered whether a
defendant can challenge a plaintiff's notice of dismissal
filed pursuant to Rule 41(a)(1)(i), several federal courts
have considered that question. In Thorp v. Scarne, 599 F.2d
1169 (2d Cir. 1979), the United States Court of Appeals for
the Second Circuit held that "notices of dismissal filed in
conformance
with
the
explicit
requirements of
Rule
41(a)(1)(i)
are not subject to vacatur" by the defendant.5 599 F.2d at
5In 2007, Rule 41(a)(1)(i), Fed. R. Civ. P., was
"restyled" as Rule 41(a)(1)(A)(i), Fed. R. Civ. P. See Schmier
v. McDonald's LLC, 569 F.3d 1240, 1241 (10th Cir. 2009)
(noting that Rule 41(a)(1)(i), Fed. R. Civ. P., was restyled
18
1160203
1176. In that case, the plaintiff filed a complaint setting
forth several claims against several defendants and seeking a
temporary restraining order. The district court conducted a
hearing on the application for a temporary restraining order,
which was subsequently denied. The plaintiff, "apparently
feeling that the cards were stacked against him, filed a
notice of voluntary dismissal under Fed. R. Civ. P.
41(a)(1)(i)." Thorp, 599 F.2d at 1171. A few hours later, the
defendants filed a motion for a partial summary judgment. The
district court then "'so ordered' plaintiff's notice of
dismissal." Id. Two days later, the defendants moved to
vacate the notice of dismissal; the plaintiff opposed this
motion, but the district court vacated the dismissal order and
the plaintiff's notice of dismissal. On appeal, the Second
Circuit stated that Rule 41(a)(1)(i) establishes a "bright-
line test marking the termination of a plaintiff's otherwise
unfettered right voluntarily and unilaterally to dismiss an
action," 599 F.2d at 1175, and, citing American Cyanamid v.
McGhee, supra, held that "notices of dismissal filed in
conformance with
the
explicit
requirements
of
Rule
41(a)(1)(i)
in 2007 as Rule 41(a)(1)(A)(i)). Thus, both rules are
substantially similar to Ala. R. Civ. P., Rule 41(a)(1)(i).
19
1160203
are not subject to vacatur." Thorp, 599 F.2d at 1176 (emphasis
added). Thus, the Court of Appeals vacated the district
court's order vacating the notice of dismissal.
In D.C. Electronics, Inc. v. Narton Corp., 511 F.2d 294
(6th Cir. 1975), the United States Court of Appeals for the
Sixth Circuit considered the issue "whether a district judge
can, in the exercise of his discretion, invalidate a notice of
dismissal filed by the plaintiff under Rule 41(a)(1)(i),
Federal Rules of Civil Procedure, prior to service 'by the
adverse party of an answer or of a motion for summary
judgment.'" 511 F.2d at 295. In that case, the plaintiff
filed a notice of voluntary dismissal pursuant to Rule
41(a)(1)(i) before the defendants had served an answer or
filed a motion for summary judgment. The following day, the
defendants served and filed an answer to the complaint and a
counterclaim against the plaintiff. The defendants also
"challenged the voluntary dismissal, and after a hearing the
district court held that the notice of voluntary dismissal was
ineffective because the case had progressed too far to allow
dismissal, and ordered the notice of voluntary dismissal
vacated." D.C. Electronics, 511 F.2d at 295. On appeal, the
20
1160203
United States Court of Appeals for the Sixth Circuit, which
also relied on the above-quoted part of American Cyanamid,
supra, held:
"Rule 41(a)(1)(i) is clear and unambiguous on its
face and admits of no exceptions that call for the
exercise of judicial discretion by any court. Other
than to determine, should the question arise,
whether an answer or a motion for summary judgment
has in fact been filed prior to the filing of a
notice of dismissal, a court has no function under
Rule 41(a)(1)(i)."
511 F.2d at 298. Thus, the Court of Appeals reversed the
district court's judgment vacating the plaintiff's notice of
dismissal.
Similarly, the United States Court of Appeals for the
Tenth Circuit has held that a district court lacks
jurisdiction to reinstate, at the request of the defendant and
over the objection of the plaintiff, an action that has been
voluntarily dismissed by the plaintiff pursuant to Rule
41(a)(1)(i). See Netwig v. Georgia Pacific Corp., 375 F.3d
1009 (10th Cir. 2004); compare Schmier v. McDonald's LLC, 569
F.3d 1240, 1242 (10th Cir. 2009) (noting that court's decision
in Netwig, supra, but holding that a district court has
jurisdiction to consider a plaintiff's Rule 60(b) motion to
21
1160203
set aside his own notice of dismissal pursuant to Rule
41(a)(1)(A)(i)).
In Marex Titanic, Inc. v. Wrecked & Abandoned Vessel, 2
F.3d 544 (4th Cir. 1993), Marex, the plaintiff, filed an
action in the district court seeking to be named the sole and
exclusive owner of any objects recovered from the RMS Titanic
or, alternatively, that it be granted a salvage award. The
district court entered a "writ of arrest" pursuant to the
Admiralty Rules, and, after the writ of arrest was published,
Titanic Ventures, an American corporation, entered a special
appearance seeking to vacate the writ of arrest. At the
request of Titanic Ventures, the district court subsequently
entered a temporary restraining order barring Marex from
salvaging the wreck. Marex then filed a notice of voluntary
dismissal pursuant to Rule 41(a)(1)(i); it was
undisputed that
Titanic Ventures had not yet served Marex with an answer or a
motion for a summary judgment when Marex filed its notice of
voluntary dismissal. However, the district court vacated
Marex's notice of dismissal and continued on with the
proceeding. The district court subsequently allowed Titanic
Ventures to intervene, vacated Marex's warrant of arrest,
22
1160203
granted Titanic Ventures exclusive right to salvage the
wreck,
and permanently enjoined Marex from taking any action to
salvage the vessel. Marex appealed the district court's
judgment, and the United States Court of Appeals for the
Fourth Circuit reversed, holding:
"When Marex filed its notice of dismissal, Titanic
Ventures had not filed an answer or a motion for
summary judgment and under Rule 41(a)(1)(i) the
action was terminated and the district court's
interlocutory orders were vacated. See In re Piper
Aircraft Distrib. Sys. Antitrust Litigation, 551 F.
2d 213, 219 (8th Cir. 1977) (The voluntary dismissal
'carrie[d] down with it previous proceedings, and
orders in the action, and all pleadings, both of
plaintiff and defendant, and all issues, with
respect to plaintiff's claim.') (quotation omitted).
Although Titanic Ventures could possibly have
initiated a new, independent civil action, the
district court had no discretion to allow Titanic
Ventures to intervene in the defunct action filed by
Marex. Therefore, the district court's judgment is
reversed."
Marex, 2 F.3d at 547–48.
In summary, the rule from these cases appears to be that
only the plaintiff may file a motion seeking to reinstate an
action after it was voluntarily dismissed pursuant to Rule
41(a)(1)(i). We find this rule well reasoned and in accord
with Alabama law concerning voluntary dismissals pursuant to
Rule 41(a)(1)(i). See Ex parte Sealy, 904 So. 2d at 1235
23
1160203
(quoting American Cyanamid, 317 F.2d at 297). As discussed
above, the City's "motion to dismiss" was a valid notice of
dismissal pursuant to Rule 41(a)(1)(i), and, based on the
authority cited above, we conclude that the circuit court was
without the power to act on Walker Brothers' attempt to
reinstate the City's action so that Walker Brothers could file
a counterclaim.6
Accordingly, we must conclude that any order entered
after the City filed its notice of dismissal on September 11,
2012, is void, including the summary judgment in favor of the
City that is the basis of Walker Brothers' appeal to this
Court. As noted above, this Court has held that the effect of
a
plaintiff's voluntary
dismissal
pursuant
to
Rule
41(a)(1)(i)
is that it "'ipso facto deprived the trial court of the power
to proceed further with the action and rendered all orders
6Though this Court is not wholly unsympathetic to Walker
Brothers' position, we note that all Walker Brothers had to do
to foreclose the City from exercising its otherwise unfettered
right to dismiss its action was to serve an answer or a motion
for a summary judgment. See American Soccer Co. v. Score First
Enterprises, 187 F.3d 1108 (9th Cir. 1999) (holding that
plaintiff's notice of dismissal pursuant to Rule 41(a)(1)(i)
was valid to terminate the district court's jurisdiction to
further consider the case and that "[t]o cut off [the
plaintiff]'s
right
to
dismiss
voluntarily,
all
[the
defendant]
had to do was to serve an answer or a motion for summary
judgment"). This, it failed to do.
24
1160203
entered after its filing void.'" Synovus, 206 So. 3d at 571
(quoting Sealy, 904 So. 2d at 1236). It is well settled that
a void order will not support an appeal. See Wehle v.
Bradley, 49 So. 3d 1203, 1207 (Ala. 2010). Accordingly,
Walker Brothers' appeal is due to be dismissed.
APPEAL DISMISSED.
Stuart, C.J., and Bolin, Parker, Shaw, Wise, and Sellers,
JJ., concur.
Murdock and Main, JJ., dissent.
25
1160203
MAIN, Justice (dissenting).
I respectfully dissent from this Court's decision to
dismiss the appeal. With regard to dismissals of actions,
Rule 41(a)(2), Ala. R. Civ. P., provides the general rule:
"[A]n action shall not be dismissed at the plaintiff's
instance save upon order of the court and upon such terms and
conditions as the court deems proper." Rule 41(a)(1) provides
the following exception: "[A]n action may be dismissed by the
plaintiff without order of court (i) by filing a notice of
dismissal at any time before service by the adverse party of
an answer or of a motion for summary judgment ...."
In my view, the City of Mobile's "motion to dismiss" was
not a "notice of dismissal" in either form or substance.
Indeed, as its title suggests, the motion requested
affirmative relief from the trial court. It did not merely
notify the court of the dismissal of the action. In its
motion, the City requested:
"Plaintiff prays the Court will enter an order
finding that the case has become moot and that
Plaintiff's
complaint
be
dismissed
without
prejudice. Plaintiff prays for such other, further
and different relief to which it may be entitled,
the premises considered."
26
1160203
On this basis, I would take the City at its word and treat the
"motion to dismiss" as just that -- a motion to dismiss filed
under Rule 41(a)(2). Accordingly, I would address the appeal
on its merits.
Murdock, J., concurs.
27 | September 15, 2017 |
096c1db6-3394-4bfb-8742-84d5a13aa08e | Georgia Urology, P.A., et al. v. Sam Johnson and City of Birmingham Retirement and Relief System | N/A | 1160158 | Alabama | Alabama Supreme Court | rel: October 20, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
____________________
1151347
____________________
Stanley D. Lawler
v.
Sam Johnson and City of Birmingham Retirement and Relief
System
____________________
1160049
____________________
Clete Walker
v.
Sam Johnson and City of Birmingham Retirement and Relief
System
____________________
1160158
____________________
Georgia Urology, P.A., et al.
v.
Sam Johnson and City of Birmingham Retirement and Relief
System
Appeals from Jefferson Circuit Court
(CV-03-6630)
STUART, Chief Justice.
Stanley D. Lawler; Clete Walker; Georgia Urology, P.A.,
and several of its member physicians (those physicians are
hereinafter referred to collectively with Georgia Urology,
P.A., as "the Georgia Urology claimants"; Lawler, Walker, and
the Georgia Urology claimants are hereinafter referred to
collectively as "the objectors"), filed objections in the
Jefferson Circuit Court challenging a $124 million attorney
fee awarded by the Jefferson Circuit Court to class counsel as
part of the settlement of Johnson v. Caremark Rx, LLC ("the
Caremark class action).1 After the trial court overruled
1Sam Johnson and City of Birmingham Retirement and Relief
System, class representatives, brought the underlying action
for themselves and on behalf of a class of all others who are
2
1151347, 1160049, 1160158
their objections and its judgment approving the settlement
became final, the objectors appealed the attorney fee to this
Court. We vacate the trial court's order awarding attorney
fees and remand the case.
I.
This Court has previously had before it appellate
proceedings arising from the Caremark class action on
multiple
occasions. See, e.g., Ex parte Caremark Rx, LLC, [Ms.
1151160, Feb. 24, 2017] ___ So. 3d ___ (Ala. 2017); CVS
Caremark Corp. v. Lauriello, 175 So. 3d 596 (Ala. 2014); and
Ex parte Caremark RX, Inc., 956 So. 2d 1117 (Ala. 2006).
Although we have described the basic facts of the case on each
of those occasions, we briefly do so again here to provide
context to the instant appeals.
Beginning in approximately 1998, MedPartners, Inc., was
the subject of dozens of securities-fraud lawsuits alleging
that it had made false statements regarding its financial
condition and anticipated future performance. Many of those
lawsuits were eventually consolidated into a class action in
the Jefferson Circuit Court
("the MedPartners class action"),
similarly situated.
3
1151347, 1160049, 1160158
and in 1999 the MedPartners class action was settled for $56
million based on MedPartners' assertions that the negotiated
settlement
exhausted
its
available
insurance coverage
and
that
it possessed limited other assets it could use to pay a larger
award or settlement. Post-settlement, however, it was
revealed in unrelated litigation that MedPartners actually
held an excess-insurance policy providing unlimited coverage
during the period in which the alleged fraud had been
committed. In 2003, the Caremark class action was initiated
against MedPartners' corporate successor, an entity now known
as Caremark Rx, LLC ("Caremark"), and its previous insurer
asserting fraud and suppression claims based on the $56
million settlement agreed to in the MedPartners class action.
Little progress was made toward resolution of the
Caremark class action over the next several years because
disputes
concerning
class
certification,
class
representatives, and which attorneys would act as class
counsel
resulted
in
time-consuming delays
and
multiple
appeals
to this Court. Ultimately, however, Caremark and its insurer
agreed in May 2016 to settle the claims asserted against them
in the Caremark class action for $310 million. The trial
4
1151347, 1160049, 1160158
court subsequently approved the settlement and awarded class
counsel 40% of the settlement fund, or $124 million, as an
attorney fee. The primary issue in these appeals is the size
of the awarded attorney fee; the objectors argue that it is
excessive and amounts to a windfall for class counsel and that
they were given insufficient time and information to properly
object to the size of the attorney-fee award.
In its June 1, 2016, order giving preliminary approval to
the $310 million settlement, the trial court set forth the
terms of the proposed settlement and outlined the procedures
by which class members could file with Gilardi & Co, LLC, the
appointed claims administrator, both proof of claims and any
objections to the proposed settlement. The trial court also
set forth the following relevant deadlines:
June 17, 2016 –– notice of the proposed settlement,
in the forms approved by the trial court, must be
published in the Wall Street Journal and on the
official settlement Web site and mailed to all
identifiable
class
members.
Class
counsel's
attorney-fee application must also be posted on the
settlement Web site.
July 22, 2016, –– written objections to any aspect
of
the
proposed
settlement,
including
class
counsel's
attorney-fee
application,
must
be
delivered to Gilardi; any objectors desiring to
present oral argument regarding their objections
5
1151347, 1160049, 1160158
must also deliver notice of that desire to the trial
court and counsel for all the parties.
July 29, 2016 –– class counsel must file and serve
its
attorney-fee
application
along
with
all
supporting materials.
August 8, 2016 –- trial court to conduct a fairness
hearing to consider fairness, reasonableness, and
adequacy of the proposed settlement.
September 30, 2016 –– class members must deliver
proof of claims to Gilardi.
The trial court also approved the notice form that would be
mailed to class members ("the short-form notice") and the more
detailed notice that would be posted on the settlement Web
site ("the long-form notice").
In accordance with this time line, on or around June 17,
2016, the short-form notice was mailed to identified class
members. Under a header stating "Your right to additional
information
and/or
to
object,"
the
short-form
notice
provided:
"A longer and more detailed notice of the
settlement, which describes additional terms of the
settlement and the procedures applicable to the
settlement,
is
available
at
www.aig-
caremarkclassaction.com. The settlement hearing
will be held on August 8, 2016 at 1:30 p.m. [at the
Jefferson County Courthouse]. ... Any class member
may object to the proposed settlement, the plan of
allocation, or the fee and expense application
and/or incentive awards. A class member may do so
by filing a written objection and/or by appearing at
the settlement hearing and showing cause why the
6
1151347, 1160049, 1160158
court should not approve the proposed settlement,
the plan of allocation, or the fee and expense
application and/or incentive awards. Additional
information regarding objecting to the settlement,
including the requirements for submitting valid
objections,
is
available
at
www.aig-
caremarkclassaction.com."
(Emphasis added.)
Thus, although the trial court's June 1,
2016, order indicated that a class member objecting to the
proposed settlement was required to file a written objection
with Gilardi by July 22, 2016, the short-form notice mailed to
class members informed them that they could object to the
proposed settlement "by filing a written objection and/or by
appearing at the settlement hearing." In this respect, the
language of the short-form notice actually mailed to the class
members differed from the language of the short-form notice
approved by the trial court in conjunction with its June 1,
2016, order; the approved short-form notice provided that "[a]
class member may [object] by filing a written objection and by
appearing at the settlement hearing ...." (Emphasis added.)
Class counsel asserts in one of its briefs filed with this
Court that the language was changed before the short-form
notice was mailed in an attempt to clarify that an objector
7
1151347, 1160049, 1160158
was not required to attend the August 8 fairness hearing in
order to assert an objection.
At approximately this same time, the long-form notice was
posted on the settlement Web site. The long-form notice
provided that, "[a]t the settlement hearing, class counsel
will request the court to award attorneys' fees not to exceed
40% of the settlement amount, plus expenses not to exceed
$3,000,000." On July 22, 2016, Walker and the Georgia Urology
claimants filed their objections to the proposed settlement;
Walker also submitted notice that he intended to appear at the
August 8 fairness hearing. Their objections to the proposed
settlement raised the same general issues –– that they were
given insufficient time and information to properly consider
the settlement and to prepare any objections; that they were
given insufficient time to gather the approximately 20-year-
old records needed to establish their claims; and that a
potential award of attorney fees up to $124 million was
excessive. On July 29, 2016, class counsel filed their
attorney-fee application formally requesting $124 million in
attorney fees, an additional $2,585,933 for expenses, and
$50,000 service awards for each of three current or former
8
1151347, 1160049, 1160158
named plaintiffs; class counsel also filed responses to the
objections made by Walker and the Georgia Urology claimants.
This attorney-fee application had not been previously posted
on the settlement Web site or made available for class members
to review.
On August 5, 2016, Lawler filed an objection to the
proposed settlement; his objection focused solely on class
counsel's requested $124 million attorney fee. Lawler also
filed notice with the trial court that he planned to be
represented at the August 8 fairness hearing. The fairness
hearing was subsequently held as scheduled, and, although
class counsel argued that Lawler's objection was
untimely, the
trial court nevertheless allowed Lawler to present his
argument. Walker also presented argument on his objections at
the hearing, and class counsel argued in response that Walker,
as well as the Georgia Urology claimants, had failed to
establish that they were class members and that their
objections should be overruled on that basis.2 Class counsel
2The trial court's June 1, 2016, order giving preliminary
approval to the proposed settlement and the long-form notice
posted on the settlement Web site stated that all written
objections to the proposed settlement must include proof that
the objector is a member of the class.
9
1151347, 1160049, 1160158
also argued generally that the arguments made by the various
objectors should be rejected on their merits because, they
argued, the schedule set by the trial court provided adequate
notice in all respects and the $124 million attorney-fee award
was warranted.
On August 15, 2016, the trial court entered a number of
orders by which it overruled the objections of Lawler and
Walker, granted in whole class counsel's attorney-fee
application with respect to the requests for an attorney fee,
expenses, and service awards for the named plaintiffs, and
entered a final judgment approving the terms of the $310
million settlement. On September 13, 2016, Walker filed a
motion pursuant to Rule 59(e), Ala. R. Civ. P., asking the
trial court to alter, amend, or vacate its orders overruling
his
objection,
granting
class
counsel's
attorney-fee
application, and entering a final judgment. Thereafter,
Lawler, Walker, and the Georgia Urology claimants, before the
September 30, 2016, deadline, filed claim forms with Gilardi
seeking
to
establish
their
eligibility
to
receive
compensation
from the settlement fund. After that deadline passed,
however, class counsel moved the trial court to review the
10
1151347, 1160049, 1160158
claim forms filed by Walker and the Georgia Urology claimants
to determine whether they had in fact asserted valid claims;
class counsel argued that they had not and urged the trial
court to overrule their objections and Walker's Rule 59(e)
motion on that basis.
Class counsel thereafter also moved the trial court to
enter a new order explicitly finding that Lawler's objection
was untimely. On October 31, 2016, the trial court entered an
order stating that Lawler's objection was both untimely and
without merit and another order holding that the Georgia
Urology claimants had failed to present evidence establishing
either (1) that they were members of the class or (2) that
they had suffered a loss that entitled them to compensation
from the settlement fund. On November 7, 2016, the trial
court entered a similar order holding that the claim forms
submitted by Walker also failed to establish that he was
entitled to any share of the settlement. On November 10,
2016, the trial court denied Walker's Rule 59(e) motion and,
pursuant to a motion jointly filed by the parties seeking to
resolve perceived procedural issues related to its previous
orders, entered a new order restating the terms of its
11
1151347, 1160049, 1160158
previous order awarding class counsel the requested attorney
fee and expenses, as well as providing service awards to the
named plaintiffs.
Out of an abundance of caution, the objectors had all
filed separate notices of appeal to this Court before the
entry of the trial court's November 10 orders, and, pursuant
to Rule 4(a)(5), Ala. R. App. P., those notices of appeal were
held in abeyance while Walker's Rule 59(e) motion was pending.
Following the resolution of that motion, the notices of appeal
became effective, and the appellate process began in earnest.
Because the objectors stipulated that they were not
contesting
the general terms of the settlement agreement, Caremark and
its insurer subsequently transferred the agreed-upon $310
million into a settlement fund. The trial court thereafter
also authorized the disbursement of the awarded attorney fee,
expense reimbursement, and service awards. On December 13,
2016, this Court consolidated Lawler's appeal (no. 1151347),
Walker's appeal (no. 1160049), and the Georgia Urology
claimants' appeal (no. 1160158) for review based on the
similarities of the issues presented.
12
1151347, 1160049, 1160158
II.
In Perdue v. Green, 127 So. 3d 343, 356 (Ala. 2012), this
Court explained the standard of review applicable in appeals
such as these where objectors seek appellate review of a trial
court's judgment approving the settlement of a class action:
"'[T]he standard of review applicable
to a trial court's approval of a proposed
settlement of a class action is as follows:
"'"There
can
be
no
settlement [of a class action]
without
the
trial
court's
approval. Rule 23(e) [Ala. R.
Civ. P.]. Requiring the trial
court's
approval
of
the
settlement protects the class
from
unjust
settlements
or
voluntary dismissals. The burden
is on the proponents of the
settlement to show that it is
fair, adequate, and reasonable.
This Court's standard of review
is to determine whether the trial
court
abused
its
discretion.
Great weight is given to the
trial court's views, because that
court has been 'exposed to the
litigants, and their strategies,
positions, and proofs."
"'Adams v. Robertson, 676 So. 2d 1265,
1272–73 (Ala. 1995) (citations omitted).'
"Disch v. Hicks, 900 So. 2d 399, 404 (Ala. 2004)."
13
1151347, 1160049, 1160158
Thus, we must ultimately determine whether the trial court
exceeded its discretion in ruling adversely to the objectors.
III.
We first consider Lawler's appeal. Lawler argues (1)
that the trial court denied the class due process by requiring
class members to file objections to any requested attorney fee
before the application for such a fee was actually filed and
(2) that the $124 million attorney fee awarded class counsel
is excessive and constitutes a windfall for class counsel.
However,
before
considering
these
arguments, we
first
consider
class counsel's motion to dismiss Lawler's appeal because,
class counsel argues, he lacks the necessary "standing."3
Class counsel first argues that Lawler's appeal –– and, for
that matter, all of these consolidated appeals –– should be
dismissed because Lawler and the other objectors failed to
formally intervene in the proceedings before the trial court.
It is undisputed, class counsel argues, that "one who is not
a party to a cause cannot appeal." Sho-Me Motor Lodges, Inc.
3Class counsel acknowledges this Court's recent caselaw
distinguishing standing from similar concepts such as real
party in interest and failure to state a claim, see, e.g., BAC
Home Loan Servicing, LP, 159 So. 2d 31, 40-47 (Ala. 2013), and
argues that, regardless of the terminology employed, Lawler is
the wrong person to pursue his stated objections.
14
1151347, 1160049, 1160158
v. Jehle-Slauson Constr. Co., 466 So. 2d 83, 88 (Ala. 1985).
See also StillWaters Residential Ass'n, Inc. v. SW Props.,
LLC, 137 So. 3d 931, 932 (Ala. Civ. App. 2013) (explaining
that the failure to intervene precludes an interested
individual or entity from appealing a judgment).
Lawler, however, argues that this Court should follow the
lead of the Supreme Court of the United States, which held in
Devlin v. Scardelletti, 536 U.S. 1, 14 (2002), "that nonnamed
class members ... who have objected in a timely manner to
approval of the settlement at a fairness hearing have the
power to bring an appeal without first intervening." Class
counsel in response has identified caselaw from some states
that have declined to apply Devlin to class actions brought
under the rules of procedure of their states, and they urge
this Court to join that group. See Hernandez v. Restoration
Hardware, Inc., 245 Cal. App. 4th 651, 199 Cal. Rptr. 3d 719
(2016) (dismissing class member's appeal of judgment where
class member did not intervene),4 and City of O'Falloon v.
CenturyLink, Inc., 491 S.W.3d 276 (Mo. Ct. App. 2016)
4We note that the Supreme Court of California has granted
a petition to review the holding in Hernandez. See Hernandez
v. Muller, 372 P.3d 200 (Cal. 2016).
15
1151347, 1160049, 1160158
(questioning standing of appellant that had not intervened in
the trial court). Class counsel also argues that the
rationale of Devlin applies only to classes certified pursuant
to Rule 23(b)(1) or (b)(2), Ala. R. Civ. P., where class
members have no ability to opt out of the class and a judgment
that would bind them, and that Devlin should not apply in the
instant case, which was certified pursuant to Rule 23(b)(3)
and allows class members to opt out if they are unsatisfied
with the terms of a proposed settlement. See Devlin, 536 U.S.
at 10 ("[I]n light of the fact that [the objector] had no
ability to opt out of the settlement, see Fed. Rule Civ. Proc.
23(b)(1), appealing the approval of the settlement is
[objector's] only means of protecting himself from being bound
by a disposition of his rights he finds unacceptable and that
a reviewing court might find legally inadequate."); see also
Barnhill v. Florida Microsoft Anti-Trust Litig., 905 So. 2d
195, 199 (Fla. Dist. Ct. App. 2005) (discussing rationale of
Devlin and concluding that "the [appellants] were not bound by
the terms of the settlement because they had the opportunity
16
1151347, 1160049, 1160158
to opt out. Accordingly, there is no reason to allow them to
appeal without intervening.").5
This Court has not expressly adopted the holding of
Devlin to cases such as the case underlying these appeals,
although, in Perdue, 127 So. 3d at 361, this Court did cite
Devlin for the proposition that objectors can appeal that
aspect of a trial court's judgment approving a settlement that
affects them. Notably, however, Perdue did not involve a
class certified pursuant to Rule 23(b)(3). The United States
Court of Appeals for the Eleventh Circuit, however, recently
considered the applicability of Devlin to class actions in
which the class was certified pursuant to Rule 23(b)(3), Fed.
R. Civ. P., and concluded that the rationale of Devlin still
applied:
"As an initial matter we must decide whether
[the objectors], who are neither named class
representatives nor intervenors, have the power to
bring this appeal. The general rule is 'only
parties to a lawsuit, or those that properly become
parties, may appeal an adverse judgment.' Marino v.
5Rule 23(b), Ala. R. Civ. P., is substantially similar to
Rule 23(b), Fed. R. Civ. P. "Federal cases construing the
Federal Rules of Civil Procedure are persuasive authority in
construing the Alabama Rules of Civil Procedure, which were
patterned after the Federal Rules of Civil Procedure." Ex
parte Novartis Pharms. Corp., 975 So. 2d 297, 300 n. 2 (Ala.
2007).
17
1151347, 1160049, 1160158
Ortiz, 484 U.S. 301, 304 (1988) (per curiam). But
in Devlin v. Scardelletti, 536 U.S. 1 (2002), the
Supreme Court held 'that nonnamed class members ...
who have objected in a timely manner to approval of
the settlement at the fairness hearing have the
power to bring an appeal without first intervening.'
Id. at 14.
"Despite differences between Devlin and this
case,
we
will
apply
Devlin's
rule
to
[the
objectors]. The objector in Devlin was part of a
mandatory class with no opt-out rights certified
under Rule 23(b)(1). See id. at 5, 10–11. The
Supreme Court recognized that because the objector
'had no ability to opt out of the settlement,'
appealing the settlement was his 'only means of
protecting himself from being bound by' its terms.
Id. at 10–11. Here in contrast, the class was
certified under Rule 23(b)(3)[, Fed. R. Civ. P.].
That means [the objectors] could have opted out of
the class. See Amchem Prod., Inc. v. Windsor, 521
U.S. 591, 617 (1997). Nevertheless, persuasive
authority convinces us to apply Devlin's rule here.
That is because 'Devlin is about party status and
one who could cease to be a party is still a party
until opting out.' Nat'l Ass'n of Chain Drug Stores
v. New England Carpenters Health Benefits Fund, 582
F.3d 30, 40 (1st Cir. 2009); accord Poertner v.
Gillette Co., 618 Fed. Appx. 624, 627–28 (11th Cir.
2015) (per curiam) (unpublished); Fidel v. Farley,
534 F.3d 508, 512–13 (6th Cir. 2008); Churchill
Vill., L.L.C. v. Gen. Elec., 361 F.3d 566, 572 (9th
Cir. 2004); In re Integra Realty Res., Inc., 354
F.3d 1246, 1257 (10th Cir. 2004). Therefore, [the
objectors], as objecting class members who did not
opt out of the settlement, may bring this appeal."
Carter v. Forjas Taurus S.A., (No. 16-15277, June 29, 2017)
___ F. App'x ___, ___ (11th Cir. 2017) (not selected for
publication in Federal Reporter). See also National Ass'n of
18
1151347, 1160049, 1160158
Chain Drug Stores v. New England Carpenters Health Benefits
Fund, 582 F.3d 30, 39-40 (1st Cir. 2009) ("[T]he weight of
authority holds that Devlin applies to all class actions.").
We agree with the rationale of Carter and the cases cited in
the excerpt quoted above. "The reality of class action
litigation –– wherein each class member is generally entitled
to only a small damages claim –- necessitates the application
of Devlin to Rule 23(b)(3) class actions." Fidel v. Farley,
534 F.3d 508, 513 (6th Cir. 2008). Accordingly, we explicitly
adopt the holding of Devlin for class actions brought in
Alabama state courts and reject class counsel's argument that
Lawler's and the other objectors' appeals should be dismissed
because the objectors did not first intervene in the trial
court.
Class counsel also argues that Lawler's appeal should be
dismissed because Lawler did not file his objections until
August 5, 2016 –– after the July 22, 2016, deadline set by the
trial court. As the United States Court of Appeals for the
Fifth Circuit recognized in Farber v. Crestwood Midstream
Partners L.P., 863 F.3d 410, 418 (5th Cir. 2017): "Devlin's
specific exception for nonparty objectors is limited to those
19
1151347, 1160049, 1160158
'who have objected in a timely manner.'" (Quoting Devlin, 536
U.S. at 14; emphasis added.) Unlike Farber, however, this is
not a case where the alleged untimely objector admitted
receiving notice of the date written objections were due, but
then consciously decided to continue with a planned two-week
vacation before returning and filing an objection two weeks
after the deadline set by the trial court. 863 F.3d at 415.
Rather, Lawler received a mailed notice informing him that he
could object to the proposed settlement "by filing a written
objection and/or by appearing at the settlement hearing."
Lawler in fact subsequently appeared through counsel at the
settlement hearing and voiced his objection –– just as the
notice he received informed him he could do.
Class counsel argues that it was made clear in court
proceedings, in the long-form notice posted on the settlement
Web site, and in the trial court's June 1, 2016, order giving
preliminary approval to the settlement that any objector was
required to file a written objection by July 22, 2016.
However, although the totality of the information presented on
the settlement Web site might have been more clear with regard
to the intended procedure and deadlines relevant to filing
20
1151347, 1160049, 1160158
objections, we decline to hold Lawler's objection untimely on
that basis. The short-form notice sent to Lawler contained
specific instructions on how to file an objection; after
listing the date, time, and location of the settlement
hearing, that notice instructed Lawler that class members
could make their objections known "by filing a written
objection and/or by appearing at the settlement hearing."
Thus, the short-form notice did not merely contain a general
statement informing class members of their right to file an
objection that would have required them to make further
inquiry to discover the process for doing so; rather, for all
that appears, the notice contained all that information.
Lawler's action in waiting to file an objection until after
the July 22, 2016, deadline set by the trial court was
consistent with the short-form notice he was sent telling him
that he could object to the proposed settlement "by filing a
written objection and/or by appearing at the settlement
hearing."6 This Court has explained that due process is
6Class counsel emphasizes that Lawler never filed an
affidavit or gave testimony regarding what he understood the
short-form notice to mean. However, the necessity for such
evidence is not needed in this case, where the language of the
notice is undisputed and speaks for itself.
21
1151347, 1160049, 1160158
fundamentally about fair play, see, e.g., Industrial Chem. &
Fiberglass Corp. v. Chandler, 547 So. 2d 812, 835 (Ala. 1988)
(on application for rehearing), and it would hardly be fair of
this Court or comport with notions of due process to punish
Lawler for acting in accordance with the notice actually
provided to him.
It is notable, moreover, that the relevant language in
the short-form notice sent to Lawler was not the language
approved by the trial court; rather, it is language that was
unilaterally added to the short-form notice by class counsel.
Although class counsel asserts that they were attempting to
resolve a different perceived ambiguity in the language
approved by the trial court when they added the language, any
ambiguity that was a product of that change should be
construed against class counsel under the doctrine of contra
proferentem. See Jehle-Slauson Constr. Co. v. Hood-Rich
Architects & Consulting Eng'rs, 435 So. 2d 716, 720 (Ala.
1983) (explaining that under the doctrine of contra
proferentem an ambiguity in a writing is construed against the
drafting party responsible for the ambiguity).
We
accordingly
find no merit in class counsel's argument that Lawler's appeal
22
1151347, 1160049, 1160158
should be dismissed on the basis of his allegedly untimely
objection, and, to the extent it overruled Lawler's objections
on that basis, the trial court exceeded its discretion in
doing so.
Having concluded that Lawler's appeal is properly before
this Court, we now turn to the merits of his arguments. He,
and the other objectors as well, argues that the schedule set
by the trial court provided insufficient opportunity for
class
members to object to class counsel's attorney-fee application
because that schedule required them to state their objections
by July 22, 2016, even though class counsel was not required
to file its attorney-fee application, and did not in fact do
so, until July 29, 2016.7 At least four United States Courts
of Appeals have indicated that such a schedule is problematic;
however, their holdings largely relied on the language of Rule
23(h), Fed. R. Civ. P., which has no counterpart in the
7The objectors have also all noted that the trial court's
June 1 order required class counsel to place their attorney-
fee application on the settlement Web site by June 17, but
class counsel failed to do so. Class counsel argues that this
requirement was mistakenly included in the June 1 order and
that the trial court always intended for the attorney-fee
application to be filed and made public on July 29. The trial
court indicated in a hearing conducted to consider Walker's
Rule 59(e) motion that class counsel's position on this point
is correct.
23
1151347, 1160049, 1160158
Alabama Rules of Civil Procedure. See Keil v. Lopez, 862 F.3d
685, 705 (8th Cir. 2017), In re National Football League
Players Concussion Injury Litig., 821 F.3d 410, 446 (3d Cir.
2016), Redman v. RadioShack Corp., 768 F.3d 622, 638 (7th Cir.
2014), and In re Mercury Interactive Corp. Sec. Litig., 618
F.3d 988, 994 (9th Cir. 2010). Rule 23(h), Fed. R. Civ. P.,
provides, in relevant part:
"In a certified class action, the court may award
reasonable attorney's fees and nontaxable costs that
are authorized by law or by the parties' agreement.
The following procedures apply:
"(1) A claim for an award must be made by
motion under Rule 54(d)(2), subject to the
provisions of this subdivision (h), at a
time the court sets. Notice of the motion
must be served on all parties and, for
motions by class counsel, directed to class
members in a reasonable manner.
"(2) A class member, or a party from whom
payment is sought, may object to the
motion."
Even though Alabama's Rule 23 has no equivalent to Federal
Rule 23(h), courts considering whether Federal Rule 23(h) has
been violated have generally recognized that there is a
concomitant due-process issue as well. See, e.g., Mercury,
618 F.3d at 993 ("We hold that the district court abused its
discretion when it erred as a matter of law by misapplying
24
1151347, 1160049, 1160158
Rule 23(h) in setting the objection deadline for class members
on a date before the deadline for lead counsel to file their
fee motion. Moreover, the practice borders on a denial of due
process because it deprives objecting class members of a full
and fair opportunity to contest class counsel's fee
motion.").
Indeed, it would seem that the requirement in Federal Rule
23(h)(2) that class members be given an opportunity to object
to class counsel's request for attorney fees is essentially a
codification of basic due-process principles. As this Court
has explained:
"Procedural due process, as guaranteed by the
Fourteenth
Amendment
to
the
United
States
Constitution and Article I, § 6, of the Alabama
Constitution of 1901, broadly speaking, contemplates
the rudimentary requirements of fair play, which
include a fair and open hearing before a legally
constituted court or other authority, with notice
and the opportunity to present evidence and
argument, representation by counsel, if desired, and
information as to the claims of the opposing party,
with reasonable opportunity to controvert them."
Ex parte Weeks, 611 So. 2d 259, 261 (Ala. 1992) (emphasis
added). See also Mullane v. Central Hanover Bank & Trust Co.,
339 U.S. 306, 314 (1950) ("An elementary and fundamental
requirement of due process in any proceeding which is to be
accorded finality is notice reasonably calculated, under all
25
1151347, 1160049, 1160158
the circumstances, to apprise interested parties of the
pendency of the action and afford them an opportunity to
present their objections." (emphasis added)).
As Ex parte Weeks and Mullane explain, a fundamental
element of due process is allowing parties that will be bound
by a court's decision to have a reasonable opportunity to make
their position and any objections known. As the federal
appellate courts that have rejected the practice of requiring
class members to object to class counsel's attorney-fee
requests before those requests are filed have concluded, that
opportunity is not provided under those circumstances. The
facts in Mercury are particularly similar to the facts in the
instant case. In Mercury, the settlement notice sent to class
members informed class members that class counsel would
request the award of an attorney fee equal to 25% of the
$117.5 million settlement fund, or $29.375 million. 618 F.3d
at 990. Class members were given until September 4, 2008, to
file written objections to any element of the proposed
settlement; two objections to the potential attorney fee were
filed by that date. Id. at 991. Class counsel, however, in
compliance with the schedule set by the trial court, did not
26
1151347, 1160049, 1160158
file its formal application for an attorney fee and supporting
documentation until September 18, 2008. On September 25,
2008, the trial court held a fairness hearing and approved the
requested attorney fee, overruling the two objections that had
been filed. Id. After one of those objectors appealed, the
United States Court of Appeals for the Ninth Circuit held that
the schedule ordered by the trial court was unlawful,
explaining:
"Moore's Federal Practice counsels that '[a]ny
objection deadline set by the court should provide
the eligible parties with an adequate opportunity to
review all of the materials that may have been
submitted in support of the motion and, in an
appropriate case, conduct discovery concerning the
fees request.' 5 Moore's Federal Practice §
23.124[4] (Matthew Bender 3d ed. 2009). Allowing
class members an opportunity thoroughly to examine
counsel's fee motion, inquire into the bases for
various charges and ensure that they are adequately
documented and supported is essential for the
protection of the rights of class members. It also
ensures that the district court, acting as a
fiduciary for the class, is presented with adequate,
and adequately-tested, information to evaluate the
reasonableness of a proposed fee.
"In this case, [the objectors were] denied such
an opportunity. At the time that [their] objections
to the fee request were due, [the objectors] could
make only generalized arguments about the size of
the total fee because they were only provided with
generalized information. [The objectors] could not
provide the court with critiques of the specific
work done by counsel when they were furnished with
27
1151347, 1160049, 1160158
no information of what that work was, how much time
it consumed, and whether and how it contributed to
the benefit of the class.
"During the fee-setting stage of common fund
class action suits such as this one, '[p]laintiffs'
counsel, otherwise a fiduciary for the class, ...
become[s] a claimant against the fund created for
the benefit of the class.' Class Plaintiffs v. City
of Seattle (In re Wash. Pub. Power Supply Sys. Sec.
Litig.), 19 F.3d 1291, 1302 (9th Cir. 1994)
(internal quotation marks omitted). This shift puts
plaintiffs' counsel's understandable interest in
getting paid the most for its work representing the
class at odds with the class' interest in securing
the largest possible recovery for its members.
Because 'the relationship between plaintiffs and
their attorneys turns adversarial at the fee-setting
stage, courts have stressed that when awarding
attorneys' fees from a common fund, the district
court must assume the role of fiduciary for the
class plaintiffs.' Id. As a fiduciary for the
class, the district court must 'act with "a jealous
regard to the rights of those who are interested in
the fund" in determining what a proper fee award
is.' Id. Included in that fiduciary obligation is
the duty to ensure that the class is afforded the
opportunity to represent its own best interests.
When the district court sets a schedule that denies
the class an adequate opportunity to review and
prepare objections to class counsel's completed fee
motion,
it
fails
to
fulfill
its
fiduciary
responsibilities to the class."
Mercury, 618 F.3d at 994-95. The Court of Appeals for the
Ninth Circuit accordingly vacated the order approving the fee
request and remanded the matter to the trial court, which
thereafter issued new notice to class members informing them
28
1151347, 1160049, 1160158
that a renewed motion seeking an award of attorney fees would
be filed by December 14, 2010, that any objections to that
motion were required to be filed by January 13, 2011, and that
a final hearing would be held February 18, 2011. In re
Mercury Interactive Corp. Sec. Litig., (No. 5:05-CV-03395-JF,
March 3, 2011) (N.D. Cal.) (unpublished order).8
Although the Court of Appeals for the Ninth Circuit in
Mercury couched its holding in terms of Federal Rule 23(h),
its logic similarly applies in this case, where class members
were informed on June 17, 2016, that class counsel would seek
an attorney fee of up to 40% of the settlement fund and that
any objections to whatever attorney fee class counsel
ultimately sought had to be filed by July 22, 2016, even
though class counsel was not required to file its actual
attorney-fee application until one week later on July 29,
2016. Class counsel argues that class members were given
notice that class counsel would be requesting an attorney fee
of up to 40% before objections were due; thus, class counsel
argues, class members were not harmed by the schedule because
8On remand, class counsel agreed to lower its requested
attorney fee and the previous objectors withdrew their
objections.
29
1151347, 1160049, 1160158
they could still file timely objections to that expected
request
without
having
seen
the
actual
attorney-fee
application. This argument, however, fails to acknowledge
that potential objectors were limited to making only general
objections under these circumstances. As the United States
Court of Appeals for the Seventh Circuit explained in Redman,
768 F.3d at 638:
"From reading the proposed settlement the objectors
knew that class counsel were likely to ask for $1
million
in
attorneys'
fees,
but
they
were
handicapped in objecting because the details of
class counsel's hours and expenses were submitted
later, with the fee motion, and so they did not have
all the information they needed to justify their
objections. The objectors were also handicapped by
not knowing the rationale that would be offered for
the fee request, a matter of particular significance
in
this
case
because
of
the
invocation
of
administrative
costs
as
a
factor
warranting
increased fees. There was no excuse for permitting
so irregular, indeed unlawful, a procedure."
See also Mercury, 618 F.3d at 994 ("At the time that [their]
objections to the fee request were due, [the objectors] could
make only generalized arguments about the size of the total
fee because they were only provided with generalized
information. [The objectors] could not provide the court with
critiques of the specific work done by counsel when they were
furnished with no information of what that work was, how much
30
1151347, 1160049, 1160158
time it consumed, and whether and how it contributed to the
benefit of the class.").
We agree with the rationales of these courts and,
especially, the conclusion in Redman that this type of
procedure is "irregular [and] indeed unlawful." Redman, 768
F.3d at 638. The class members in this case were not afforded
due process inasmuch as they were not allowed to view,
consider, and respond to class counsel's attorney-fee
application before they were required to file any objections
to that application. See Ex parte Weeks, 611 So. 2d at 261
(holding that due process requires that parties be given
information regarding the claims of an opposing party and a
reasonable
opportunity
to
controvert
them).
It
is
insufficient that class members had an opportunity to file a
general objection to what they anticipated class counsel might
request as an attorney-fee award; principles of due process
require that they have an opportunity to respond to the
attorney-fee application that is actually filed. The long-
form notice in fact promised class members this opportunity
inasmuch as it stated that "[a]ny class member may object to
the proposed settlement, the plan of allocation, the fee and
31
1151347, 1160049, 1160158
expense application and/or incentive awards."9 In authorizing
a schedule requiring class members to object to class
counsel's requested attorney fee before class counsel filed
its attorney-fee application, the trial court acted beyond its
discretion and
violated
the
class
members'
due-process rights.
The trial court's error being established, however, we
must still consider whether that error was harmless. See Rule
45, Ala. R. App. P. ("No judgment may be reversed or set aside
... for error as to any matter of pleading or procedure,
unless in the opinion of the court to which the appeal is
taken or application is made, after an examination of the
entire cause, it should appear that the error complained of
has probably injuriously affected substantial rights of the
parties."), and Keil, 862 F.3d at 705-06 (concluding that
trial court's error in setting the deadline for objections
before the deadline for class counsel to file their fee motion
was harmless under the circumstances). Class counsel, in
9The long-form notice posted on June 17, 2016, also
advised class members that "the fee and expense application,
together with selected pleadings and other settlement-related
documents
may
be
viewed
online
at
www.aig-
caremarkclassaction.com." However, as explained, the fee and
expense application was not actually posted until it was filed
on July 29, 2016.
32
1151347, 1160049, 1160158
fact, has argued that any error in the timing of the filing of
its fee and expense application was harmless because Walker
and the Georgia Urology claimants filed additional motions
with the trial court explaining their objections after class
counsel filed its application, and Walker and Lawler also
presented arguments orally at the August 8 hearing. In
Cassese v. Williams, 503 F. App'x 55, 58 (2d Cir. 2012) (not
selected for publication in Federal Reporter), the United
States Court of Appeals for the Second Circuit declined to
follow the rationale of the Mercury court at least partially
for this reason, explaining:
"In its ... fee motion, class counsel requested fees
and costs in the precise amounts specified in the
settlement
notice
and
divulged
additional
information regarding counsel's billing rates, hours
worked, and tasks performed. Any objectors then had
two weeks to crystallize their objections and
request further information before attending the
fairness hearing. With the objectors here having
availed themselves of those opportunities, we
identify no abuse of discretion or due process
denial in that portion of the district court's
scheduling order relating to the fee motion."
See also Keil, 862 F.3d at 705 (holding that the trial court
erred in closing objections before class counsel's attorney-
fee application was filed but that that error was harmless
because the objectors subsequently had an opportunity to
33
1151347, 1160049, 1160158
respond to the specific arguments contained within class
counsel's fee application).
We decline, however, to find the error in this case
harmless. We first note that the interval between class
counsel's filing of its application for an attorney fee and
the subsequent fairness hearing was only 10 days –– 5 business
days. Although class counsel has cited several published
opinions in which courts have approved of schedules such as
the one being challenged in this case, none of those opinions
involved as short an interval between the time the attorney-
fee application was filed and the settlement hearing as in
this case. See, e.g., CertainTeed Fiber Cement Siding
Litig., 303 F.R.D. 199, 222 (E.D. Pa. 2014) (three weeks), and
Saccoccio v. JP Morgan Chase Bank, N.A., 297 F.R.D. 683, 699
(S.D. Fla. 2014) (two weeks). Like the Keil court, "[w]e do
not purport to decide how much time after the fee motion
deadline is sufficient to provide class members with an
adequate opportunity to object to the motion," 862 F.3d at
705; however, the short interval provided class members in
this case surely borders on what due process requires.
34
1151347, 1160049, 1160158
Additionally, we note that in most of the cases that have
been brought to this Court's attention in which a court has
rejected an objector's arguments concerning a schedule
requiring the objector to object to an attorney-fee
application before that application is actually filed, the
ruling court has noted that the objector ultimately was
provided access to detailed information about the
hours worked
by class counsel, along with descriptions of the specific
tasks class counsel performed during those hours, and then had
at least some opportunity to respond to that information.
See, e.g., Keil, 862 F.3d at 701 (noting that "the hours and
rates submitted by class counsel were reasonable"); Cassese,
503 F. App'x at 58 (noting that class counsel's fee
application
"divulged
additional
information
regarding
counsel's billing rates, hours worked, and tasks performed");
and CertainTeed, 303 F.R.D. at 223 (noting that "[c]lass
counsel have spent over 12,656 hours in prosecuting this case
on behalf of the settlement class"). In this case, however,
the class was never provided such information. Class counsel
stated in its attorney-fee application that the amount of time
it expended on this case was irrelevant or of only minor
35
1151347, 1160049, 1160158
importance, and it repeats that claim on appeal, arguing that
this Court in Edelman & Combs v. Law, 663 So. 2d 957, 959
(Ala. 1995), held that "in a class action where the plaintiff
class prevails and the lawyer's efforts result in a recovery
of a fund, by way of settlement or trial, a reasonable
attorney fee should be determined as a percentage of the
amount agreed upon in settlement or recovered at trial."
However, although it is true that Edelman warns trial courts
against "a strict reliance" on the time-expended factor when
awarding an attorney fee in a common-fund case, 663 So. 2d at
960, it is not accurate to say that Edelman declared the time-
expended factor to be irrelevant in common-fund cases. To the
contrary, Edelman states:
"We hold that the lawyers representing the
plaintiff class in this case are entitled to a
reasonable
percentage
of
the
amount
of
the
settlement. In determining that percentage, the
trial court should consider all relevant factors,
including the number of hours expended on behalf of
the class. Several factors, including the number of
lawyers who were actively engaged for over four
years in the handling of the claims, the complexity
of the litigation, as well as the management
responsibilities inherent in a class action, and the
result obtained, would justify a[n] award of an
amount between 20% and 33 1/3% of the amount of the
settlement. However, the plaintiffs' attorneys did
not introduce any evidence of the actual time spent
on behalf of the class. The trial court should
36
1151347, 1160049, 1160158
consider that factor in determining the appropriate
percentage to be awarded in this case."
663 So. 2d at 961 (emphasis added.)10
Class counsel notes also, however, that the trial court
has stated that it had seen the thousands of hours of time
expended by class counsel over the many years this case has
been pending and that it did not need time sheets to conclude
that the time class counsel spent on the case weighed in favor
of the $124 million award. However, although the trial court
certainly has some personal knowledge of the time expended by
class counsel in this case, Lawler argues that the facts of
this case demand a closer examination of those hours.
Specifically, he argues that much of the time expended by
class counsel in this case, and the corresponding delay in
reaching a final resolution, is due to class counsel's own
missteps and questionable decisions. As examples, Lawler
notes that it was class counsel that was initially "duped" in
the original settlement of the MedPartners class action, that
class counsel's unsuccessful attempt to avoid the class-
certification process, as detailed in Ex parte Caremark RX,
10This Court has listed factors relevant to determining
the reasonableness of attorney fees in Peebles v. Miley, 439
So. 2d 137, 140-41 (Ala. 1983).
37
1151347, 1160049, 1160158
Inc., 956 So. 2d 1117 (Ala. 2006), added years of delay and
additional expenses to the litigation, that much of the other
time expended by class counsel in this case was devoted to
class counsel's efforts defending themselves from attempts to
disqualify them and from other attorneys seeking to replace
them as a result of class counsel's previous decisions, and
that class counsel's efforts of late have been directed toward
avoiding a meaningful review of their requested attorney fee
to the express detriment of the class.
Lawler argues that the time expended on those efforts
cannot be used by class counsel to justify an attorney fee
because, he argues, that time did not benefit the class; class
counsel, however, argues that the $310 million settlement they
ultimately negotiated demonstrates that those efforts all
benefited the class. Without deciding this issue, we agree
with Lawler that the class members are entitled to more
information about the amount of time class counsel expended in
this case and the manner in which that time was spent. As
explained in Edelman, 663 So. 2d at 961, the amount of time
expended on behalf of the class is still a relevant factor
that should be considered when determining a reasonable
38
1151347, 1160049, 1160158
attorney fee in a class-action case. Accordingly, class
members are entitled to basic information in that regard so
they can adequately argue any objections they have, as is
their due-process right. On remand, the trial court should
direct a process whereby that information is provided to the
objectors; the objectors subsequently are provided with
adequate time to restate their objections in light of that
information; and the trial court then considers those
objections and enters a new order awarding an attorney fee.11
Our resolution of this issue obviates the need to conduct our
own review of the reasonableness of the awarded attorney fee
at this time, as well as the need to consider the other issues
raised by Lawler and the other objectors.12
11We further note that the information Lawler and the
other objectors seek regarding the time class counsel has
spent on this case will also better allow this Court to
conduct a "meaningful review," Wehle v. Bradley, 195 So. 3d
928, 946 (Ala. 2015), of the attorney fee awarded on remand if
class counsel and the objectors are unable to resolve their
dispute and a subsequent appeal is necessary.
12Walker and the Georgia Urology claimants have argued in
their
appeals
that
the
trial
court
wrongfully
took
consideration of their claims from Gilardi and
determined that
those claims were not valid. Because we have already
determined that remand is appropriate, we decline to consider
those arguments at this time. Appellate review in a piecemeal
fashion is generally disfavored, Dzwonkowski v. Sonitrol of
Mobile, Inc., 892 So. 2d 354, 363 (Ala. 2004), and Walker and
39
1151347, 1160049, 1160158
IV.
After class counsel negotiated a $310 million settlement
with Caremark and its insurer resolving class members' fraud
and suppression claims stemming from the previous settlement
of the MedPartners class action, the objectors filed notice
with the trial court that they objected to class counsel's
request that 40% of the settlement, or $124 million, be paid
to them as an attorney fee. The trial court thereafter
overruled those objections and entered an order awarding class
counsel the $124 million attorney fee they had requested. The
objectors subsequently separately appealed that award to this
Court, arguing that they had been given insufficient
opportunity to object to class counsel's requested attorney
fee inasmuch as their objections were due before class
counsel's attorney-fee application was filed, and that the
attorney fee ultimately awarded was excessive. We agree with
Lawler's and the other objectors' argument that a schedule
the Georgia Urology claimants can present their arguments
regarding their claims to the trial court again on remand
along with their objections regarding class counsel's
attorney-fee application. Should an issue in that regard
still exist after the trial court enters a new order making an
award of attorney fees, Walker and the Georgia Urology
claimants may argue them on appeal, along with any objections
they have to that new attorney-fee award.
40
1151347, 1160049, 1160158
requiring class members to object to class counsel's attorney-
fee request before any such request is formally made violates
class members' due-process rights. Furthermore, we
agree with
Lawler that the objectors were entitled to more information
from class counsel about the time expended on this case in
order to allow them to properly articulate their objections.
Accordingly, we now vacate the order entered by the trial
court awarding class counsel an attorney fee of $124 million.
On remand, class counsel may file a new attorney-fee
application,
including
more
detailed
information
regarding
the
time expended in this case and how that time was spent. The
objectors shall then be given a reasonable opportunity to
review that application and may, if they still have objections
to class counsel's new application, file those objections with
the trial court. After the trial court considers those
objections and enters a new order making an award of attorney
fees, any party with a grievance may file a new appeal with
this Court.
1151347 –– ORDER VACATED AND CASE REMANDED.
1160049 –– ORDER VACATED AND CASE REMANDED.
1160158 –– ORDER VACATED AND CASE REMANDED.
Shaw, Wise, and Sellers, JJ., concur.
Parker, J., concurs in the result.
41 | October 20, 2017 |
df65fda2-bf33-435d-a457-81ead8ecb638 | Walker v. Johnson | N/A | 1160049, 1151347, 1160158 | Alabama | Alabama Supreme Court | rel: October 20, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
____________________
1151347
____________________
Stanley D. Lawler
v.
Sam Johnson and City of Birmingham Retirement and Relief
System
____________________
1160049
____________________
Clete Walker
v.
Sam Johnson and City of Birmingham Retirement and Relief
System
____________________
1160158
____________________
Georgia Urology, P.A., et al.
v.
Sam Johnson and City of Birmingham Retirement and Relief
System
Appeals from Jefferson Circuit Court
(CV-03-6630)
STUART, Chief Justice.
Stanley D. Lawler; Clete Walker; Georgia Urology, P.A.,
and several of its member physicians (those physicians are
hereinafter referred to collectively with Georgia Urology,
P.A., as "the Georgia Urology claimants"; Lawler, Walker, and
the Georgia Urology claimants are hereinafter referred to
collectively as "the objectors"), filed objections in the
Jefferson Circuit Court challenging a $124 million attorney
fee awarded by the Jefferson Circuit Court to class counsel as
part of the settlement of Johnson v. Caremark Rx, LLC ("the
Caremark class action).1 After the trial court overruled
1Sam Johnson and City of Birmingham Retirement and Relief
System, class representatives, brought the underlying action
for themselves and on behalf of a class of all others who are
2
1151347, 1160049, 1160158
their objections and its judgment approving the settlement
became final, the objectors appealed the attorney fee to this
Court. We vacate the trial court's order awarding attorney
fees and remand the case.
I.
This Court has previously had before it appellate
proceedings arising from the Caremark class action on
multiple
occasions. See, e.g., Ex parte Caremark Rx, LLC, [Ms.
1151160, Feb. 24, 2017] ___ So. 3d ___ (Ala. 2017); CVS
Caremark Corp. v. Lauriello, 175 So. 3d 596 (Ala. 2014); and
Ex parte Caremark RX, Inc., 956 So. 2d 1117 (Ala. 2006).
Although we have described the basic facts of the case on each
of those occasions, we briefly do so again here to provide
context to the instant appeals.
Beginning in approximately 1998, MedPartners, Inc., was
the subject of dozens of securities-fraud lawsuits alleging
that it had made false statements regarding its financial
condition and anticipated future performance. Many of those
lawsuits were eventually consolidated into a class action in
the Jefferson Circuit Court
("the MedPartners class action"),
similarly situated.
3
1151347, 1160049, 1160158
and in 1999 the MedPartners class action was settled for $56
million based on MedPartners' assertions that the negotiated
settlement
exhausted
its
available
insurance coverage
and
that
it possessed limited other assets it could use to pay a larger
award or settlement. Post-settlement, however, it was
revealed in unrelated litigation that MedPartners actually
held an excess-insurance policy providing unlimited coverage
during the period in which the alleged fraud had been
committed. In 2003, the Caremark class action was initiated
against MedPartners' corporate successor, an entity now known
as Caremark Rx, LLC ("Caremark"), and its previous insurer
asserting fraud and suppression claims based on the $56
million settlement agreed to in the MedPartners class action.
Little progress was made toward resolution of the
Caremark class action over the next several years because
disputes
concerning
class
certification,
class
representatives, and which attorneys would act as class
counsel
resulted
in
time-consuming delays
and
multiple
appeals
to this Court. Ultimately, however, Caremark and its insurer
agreed in May 2016 to settle the claims asserted against them
in the Caremark class action for $310 million. The trial
4
1151347, 1160049, 1160158
court subsequently approved the settlement and awarded class
counsel 40% of the settlement fund, or $124 million, as an
attorney fee. The primary issue in these appeals is the size
of the awarded attorney fee; the objectors argue that it is
excessive and amounts to a windfall for class counsel and that
they were given insufficient time and information to properly
object to the size of the attorney-fee award.
In its June 1, 2016, order giving preliminary approval to
the $310 million settlement, the trial court set forth the
terms of the proposed settlement and outlined the procedures
by which class members could file with Gilardi & Co, LLC, the
appointed claims administrator, both proof of claims and any
objections to the proposed settlement. The trial court also
set forth the following relevant deadlines:
June 17, 2016 –– notice of the proposed settlement,
in the forms approved by the trial court, must be
published in the Wall Street Journal and on the
official settlement Web site and mailed to all
identifiable
class
members.
Class
counsel's
attorney-fee application must also be posted on the
settlement Web site.
July 22, 2016, –– written objections to any aspect
of
the
proposed
settlement,
including
class
counsel's
attorney-fee
application,
must
be
delivered to Gilardi; any objectors desiring to
present oral argument regarding their objections
5
1151347, 1160049, 1160158
must also deliver notice of that desire to the trial
court and counsel for all the parties.
July 29, 2016 –– class counsel must file and serve
its
attorney-fee
application
along
with
all
supporting materials.
August 8, 2016 –- trial court to conduct a fairness
hearing to consider fairness, reasonableness, and
adequacy of the proposed settlement.
September 30, 2016 –– class members must deliver
proof of claims to Gilardi.
The trial court also approved the notice form that would be
mailed to class members ("the short-form notice") and the more
detailed notice that would be posted on the settlement Web
site ("the long-form notice").
In accordance with this time line, on or around June 17,
2016, the short-form notice was mailed to identified class
members. Under a header stating "Your right to additional
information
and/or
to
object,"
the
short-form
notice
provided:
"A longer and more detailed notice of the
settlement, which describes additional terms of the
settlement and the procedures applicable to the
settlement,
is
available
at
www.aig-
caremarkclassaction.com. The settlement hearing
will be held on August 8, 2016 at 1:30 p.m. [at the
Jefferson County Courthouse]. ... Any class member
may object to the proposed settlement, the plan of
allocation, or the fee and expense application
and/or incentive awards. A class member may do so
by filing a written objection and/or by appearing at
the settlement hearing and showing cause why the
6
1151347, 1160049, 1160158
court should not approve the proposed settlement,
the plan of allocation, or the fee and expense
application and/or incentive awards. Additional
information regarding objecting to the settlement,
including the requirements for submitting valid
objections,
is
available
at
www.aig-
caremarkclassaction.com."
(Emphasis added.)
Thus, although the trial court's June 1,
2016, order indicated that a class member objecting to the
proposed settlement was required to file a written objection
with Gilardi by July 22, 2016, the short-form notice mailed to
class members informed them that they could object to the
proposed settlement "by filing a written objection and/or by
appearing at the settlement hearing." In this respect, the
language of the short-form notice actually mailed to the class
members differed from the language of the short-form notice
approved by the trial court in conjunction with its June 1,
2016, order; the approved short-form notice provided that "[a]
class member may [object] by filing a written objection and by
appearing at the settlement hearing ...." (Emphasis added.)
Class counsel asserts in one of its briefs filed with this
Court that the language was changed before the short-form
notice was mailed in an attempt to clarify that an objector
7
1151347, 1160049, 1160158
was not required to attend the August 8 fairness hearing in
order to assert an objection.
At approximately this same time, the long-form notice was
posted on the settlement Web site. The long-form notice
provided that, "[a]t the settlement hearing, class counsel
will request the court to award attorneys' fees not to exceed
40% of the settlement amount, plus expenses not to exceed
$3,000,000." On July 22, 2016, Walker and the Georgia Urology
claimants filed their objections to the proposed settlement;
Walker also submitted notice that he intended to appear at the
August 8 fairness hearing. Their objections to the proposed
settlement raised the same general issues –– that they were
given insufficient time and information to properly consider
the settlement and to prepare any objections; that they were
given insufficient time to gather the approximately 20-year-
old records needed to establish their claims; and that a
potential award of attorney fees up to $124 million was
excessive. On July 29, 2016, class counsel filed their
attorney-fee application formally requesting $124 million in
attorney fees, an additional $2,585,933 for expenses, and
$50,000 service awards for each of three current or former
8
1151347, 1160049, 1160158
named plaintiffs; class counsel also filed responses to the
objections made by Walker and the Georgia Urology claimants.
This attorney-fee application had not been previously posted
on the settlement Web site or made available for class members
to review.
On August 5, 2016, Lawler filed an objection to the
proposed settlement; his objection focused solely on class
counsel's requested $124 million attorney fee. Lawler also
filed notice with the trial court that he planned to be
represented at the August 8 fairness hearing. The fairness
hearing was subsequently held as scheduled, and, although
class counsel argued that Lawler's objection was
untimely, the
trial court nevertheless allowed Lawler to present his
argument. Walker also presented argument on his objections at
the hearing, and class counsel argued in response that Walker,
as well as the Georgia Urology claimants, had failed to
establish that they were class members and that their
objections should be overruled on that basis.2 Class counsel
2The trial court's June 1, 2016, order giving preliminary
approval to the proposed settlement and the long-form notice
posted on the settlement Web site stated that all written
objections to the proposed settlement must include proof that
the objector is a member of the class.
9
1151347, 1160049, 1160158
also argued generally that the arguments made by the various
objectors should be rejected on their merits because, they
argued, the schedule set by the trial court provided adequate
notice in all respects and the $124 million attorney-fee award
was warranted.
On August 15, 2016, the trial court entered a number of
orders by which it overruled the objections of Lawler and
Walker, granted in whole class counsel's attorney-fee
application with respect to the requests for an attorney fee,
expenses, and service awards for the named plaintiffs, and
entered a final judgment approving the terms of the $310
million settlement. On September 13, 2016, Walker filed a
motion pursuant to Rule 59(e), Ala. R. Civ. P., asking the
trial court to alter, amend, or vacate its orders overruling
his
objection,
granting
class
counsel's
attorney-fee
application, and entering a final judgment. Thereafter,
Lawler, Walker, and the Georgia Urology claimants, before the
September 30, 2016, deadline, filed claim forms with Gilardi
seeking
to
establish
their
eligibility
to
receive
compensation
from the settlement fund. After that deadline passed,
however, class counsel moved the trial court to review the
10
1151347, 1160049, 1160158
claim forms filed by Walker and the Georgia Urology claimants
to determine whether they had in fact asserted valid claims;
class counsel argued that they had not and urged the trial
court to overrule their objections and Walker's Rule 59(e)
motion on that basis.
Class counsel thereafter also moved the trial court to
enter a new order explicitly finding that Lawler's objection
was untimely. On October 31, 2016, the trial court entered an
order stating that Lawler's objection was both untimely and
without merit and another order holding that the Georgia
Urology claimants had failed to present evidence establishing
either (1) that they were members of the class or (2) that
they had suffered a loss that entitled them to compensation
from the settlement fund. On November 7, 2016, the trial
court entered a similar order holding that the claim forms
submitted by Walker also failed to establish that he was
entitled to any share of the settlement. On November 10,
2016, the trial court denied Walker's Rule 59(e) motion and,
pursuant to a motion jointly filed by the parties seeking to
resolve perceived procedural issues related to its previous
orders, entered a new order restating the terms of its
11
1151347, 1160049, 1160158
previous order awarding class counsel the requested attorney
fee and expenses, as well as providing service awards to the
named plaintiffs.
Out of an abundance of caution, the objectors had all
filed separate notices of appeal to this Court before the
entry of the trial court's November 10 orders, and, pursuant
to Rule 4(a)(5), Ala. R. App. P., those notices of appeal were
held in abeyance while Walker's Rule 59(e) motion was pending.
Following the resolution of that motion, the notices of appeal
became effective, and the appellate process began in earnest.
Because the objectors stipulated that they were not
contesting
the general terms of the settlement agreement, Caremark and
its insurer subsequently transferred the agreed-upon $310
million into a settlement fund. The trial court thereafter
also authorized the disbursement of the awarded attorney fee,
expense reimbursement, and service awards. On December 13,
2016, this Court consolidated Lawler's appeal (no. 1151347),
Walker's appeal (no. 1160049), and the Georgia Urology
claimants' appeal (no. 1160158) for review based on the
similarities of the issues presented.
12
1151347, 1160049, 1160158
II.
In Perdue v. Green, 127 So. 3d 343, 356 (Ala. 2012), this
Court explained the standard of review applicable in appeals
such as these where objectors seek appellate review of a trial
court's judgment approving the settlement of a class action:
"'[T]he standard of review applicable
to a trial court's approval of a proposed
settlement of a class action is as follows:
"'"There
can
be
no
settlement [of a class action]
without
the
trial
court's
approval. Rule 23(e) [Ala. R.
Civ. P.]. Requiring the trial
court's
approval
of
the
settlement protects the class
from
unjust
settlements
or
voluntary dismissals. The burden
is on the proponents of the
settlement to show that it is
fair, adequate, and reasonable.
This Court's standard of review
is to determine whether the trial
court
abused
its
discretion.
Great weight is given to the
trial court's views, because that
court has been 'exposed to the
litigants, and their strategies,
positions, and proofs."
"'Adams v. Robertson, 676 So. 2d 1265,
1272–73 (Ala. 1995) (citations omitted).'
"Disch v. Hicks, 900 So. 2d 399, 404 (Ala. 2004)."
13
1151347, 1160049, 1160158
Thus, we must ultimately determine whether the trial court
exceeded its discretion in ruling adversely to the objectors.
III.
We first consider Lawler's appeal. Lawler argues (1)
that the trial court denied the class due process by requiring
class members to file objections to any requested attorney fee
before the application for such a fee was actually filed and
(2) that the $124 million attorney fee awarded class counsel
is excessive and constitutes a windfall for class counsel.
However,
before
considering
these
arguments, we
first
consider
class counsel's motion to dismiss Lawler's appeal because,
class counsel argues, he lacks the necessary "standing."3
Class counsel first argues that Lawler's appeal –– and, for
that matter, all of these consolidated appeals –– should be
dismissed because Lawler and the other objectors failed to
formally intervene in the proceedings before the trial court.
It is undisputed, class counsel argues, that "one who is not
a party to a cause cannot appeal." Sho-Me Motor Lodges, Inc.
3Class counsel acknowledges this Court's recent caselaw
distinguishing standing from similar concepts such as real
party in interest and failure to state a claim, see, e.g., BAC
Home Loan Servicing, LP, 159 So. 2d 31, 40-47 (Ala. 2013), and
argues that, regardless of the terminology employed, Lawler is
the wrong person to pursue his stated objections.
14
1151347, 1160049, 1160158
v. Jehle-Slauson Constr. Co., 466 So. 2d 83, 88 (Ala. 1985).
See also StillWaters Residential Ass'n, Inc. v. SW Props.,
LLC, 137 So. 3d 931, 932 (Ala. Civ. App. 2013) (explaining
that the failure to intervene precludes an interested
individual or entity from appealing a judgment).
Lawler, however, argues that this Court should follow the
lead of the Supreme Court of the United States, which held in
Devlin v. Scardelletti, 536 U.S. 1, 14 (2002), "that nonnamed
class members ... who have objected in a timely manner to
approval of the settlement at a fairness hearing have the
power to bring an appeal without first intervening." Class
counsel in response has identified caselaw from some states
that have declined to apply Devlin to class actions brought
under the rules of procedure of their states, and they urge
this Court to join that group. See Hernandez v. Restoration
Hardware, Inc., 245 Cal. App. 4th 651, 199 Cal. Rptr. 3d 719
(2016) (dismissing class member's appeal of judgment where
class member did not intervene),4 and City of O'Falloon v.
CenturyLink, Inc., 491 S.W.3d 276 (Mo. Ct. App. 2016)
4We note that the Supreme Court of California has granted
a petition to review the holding in Hernandez. See Hernandez
v. Muller, 372 P.3d 200 (Cal. 2016).
15
1151347, 1160049, 1160158
(questioning standing of appellant that had not intervened in
the trial court). Class counsel also argues that the
rationale of Devlin applies only to classes certified pursuant
to Rule 23(b)(1) or (b)(2), Ala. R. Civ. P., where class
members have no ability to opt out of the class and a judgment
that would bind them, and that Devlin should not apply in the
instant case, which was certified pursuant to Rule 23(b)(3)
and allows class members to opt out if they are unsatisfied
with the terms of a proposed settlement. See Devlin, 536 U.S.
at 10 ("[I]n light of the fact that [the objector] had no
ability to opt out of the settlement, see Fed. Rule Civ. Proc.
23(b)(1), appealing the approval of the settlement is
[objector's] only means of protecting himself from being bound
by a disposition of his rights he finds unacceptable and that
a reviewing court might find legally inadequate."); see also
Barnhill v. Florida Microsoft Anti-Trust Litig., 905 So. 2d
195, 199 (Fla. Dist. Ct. App. 2005) (discussing rationale of
Devlin and concluding that "the [appellants] were not bound by
the terms of the settlement because they had the opportunity
16
1151347, 1160049, 1160158
to opt out. Accordingly, there is no reason to allow them to
appeal without intervening.").5
This Court has not expressly adopted the holding of
Devlin to cases such as the case underlying these appeals,
although, in Perdue, 127 So. 3d at 361, this Court did cite
Devlin for the proposition that objectors can appeal that
aspect of a trial court's judgment approving a settlement that
affects them. Notably, however, Perdue did not involve a
class certified pursuant to Rule 23(b)(3). The United States
Court of Appeals for the Eleventh Circuit, however, recently
considered the applicability of Devlin to class actions in
which the class was certified pursuant to Rule 23(b)(3), Fed.
R. Civ. P., and concluded that the rationale of Devlin still
applied:
"As an initial matter we must decide whether
[the objectors], who are neither named class
representatives nor intervenors, have the power to
bring this appeal. The general rule is 'only
parties to a lawsuit, or those that properly become
parties, may appeal an adverse judgment.' Marino v.
5Rule 23(b), Ala. R. Civ. P., is substantially similar to
Rule 23(b), Fed. R. Civ. P. "Federal cases construing the
Federal Rules of Civil Procedure are persuasive authority in
construing the Alabama Rules of Civil Procedure, which were
patterned after the Federal Rules of Civil Procedure." Ex
parte Novartis Pharms. Corp., 975 So. 2d 297, 300 n. 2 (Ala.
2007).
17
1151347, 1160049, 1160158
Ortiz, 484 U.S. 301, 304 (1988) (per curiam). But
in Devlin v. Scardelletti, 536 U.S. 1 (2002), the
Supreme Court held 'that nonnamed class members ...
who have objected in a timely manner to approval of
the settlement at the fairness hearing have the
power to bring an appeal without first intervening.'
Id. at 14.
"Despite differences between Devlin and this
case,
we
will
apply
Devlin's
rule
to
[the
objectors]. The objector in Devlin was part of a
mandatory class with no opt-out rights certified
under Rule 23(b)(1). See id. at 5, 10–11. The
Supreme Court recognized that because the objector
'had no ability to opt out of the settlement,'
appealing the settlement was his 'only means of
protecting himself from being bound by' its terms.
Id. at 10–11. Here in contrast, the class was
certified under Rule 23(b)(3)[, Fed. R. Civ. P.].
That means [the objectors] could have opted out of
the class. See Amchem Prod., Inc. v. Windsor, 521
U.S. 591, 617 (1997). Nevertheless, persuasive
authority convinces us to apply Devlin's rule here.
That is because 'Devlin is about party status and
one who could cease to be a party is still a party
until opting out.' Nat'l Ass'n of Chain Drug Stores
v. New England Carpenters Health Benefits Fund, 582
F.3d 30, 40 (1st Cir. 2009); accord Poertner v.
Gillette Co., 618 Fed. Appx. 624, 627–28 (11th Cir.
2015) (per curiam) (unpublished); Fidel v. Farley,
534 F.3d 508, 512–13 (6th Cir. 2008); Churchill
Vill., L.L.C. v. Gen. Elec., 361 F.3d 566, 572 (9th
Cir. 2004); In re Integra Realty Res., Inc., 354
F.3d 1246, 1257 (10th Cir. 2004). Therefore, [the
objectors], as objecting class members who did not
opt out of the settlement, may bring this appeal."
Carter v. Forjas Taurus S.A., (No. 16-15277, June 29, 2017)
___ F. App'x ___, ___ (11th Cir. 2017) (not selected for
publication in Federal Reporter). See also National Ass'n of
18
1151347, 1160049, 1160158
Chain Drug Stores v. New England Carpenters Health Benefits
Fund, 582 F.3d 30, 39-40 (1st Cir. 2009) ("[T]he weight of
authority holds that Devlin applies to all class actions.").
We agree with the rationale of Carter and the cases cited in
the excerpt quoted above. "The reality of class action
litigation –– wherein each class member is generally entitled
to only a small damages claim –- necessitates the application
of Devlin to Rule 23(b)(3) class actions." Fidel v. Farley,
534 F.3d 508, 513 (6th Cir. 2008). Accordingly, we explicitly
adopt the holding of Devlin for class actions brought in
Alabama state courts and reject class counsel's argument that
Lawler's and the other objectors' appeals should be dismissed
because the objectors did not first intervene in the trial
court.
Class counsel also argues that Lawler's appeal should be
dismissed because Lawler did not file his objections until
August 5, 2016 –– after the July 22, 2016, deadline set by the
trial court. As the United States Court of Appeals for the
Fifth Circuit recognized in Farber v. Crestwood Midstream
Partners L.P., 863 F.3d 410, 418 (5th Cir. 2017): "Devlin's
specific exception for nonparty objectors is limited to those
19
1151347, 1160049, 1160158
'who have objected in a timely manner.'" (Quoting Devlin, 536
U.S. at 14; emphasis added.) Unlike Farber, however, this is
not a case where the alleged untimely objector admitted
receiving notice of the date written objections were due, but
then consciously decided to continue with a planned two-week
vacation before returning and filing an objection two weeks
after the deadline set by the trial court. 863 F.3d at 415.
Rather, Lawler received a mailed notice informing him that he
could object to the proposed settlement "by filing a written
objection and/or by appearing at the settlement hearing."
Lawler in fact subsequently appeared through counsel at the
settlement hearing and voiced his objection –– just as the
notice he received informed him he could do.
Class counsel argues that it was made clear in court
proceedings, in the long-form notice posted on the settlement
Web site, and in the trial court's June 1, 2016, order giving
preliminary approval to the settlement that any objector was
required to file a written objection by July 22, 2016.
However, although the totality of the information presented on
the settlement Web site might have been more clear with regard
to the intended procedure and deadlines relevant to filing
20
1151347, 1160049, 1160158
objections, we decline to hold Lawler's objection untimely on
that basis. The short-form notice sent to Lawler contained
specific instructions on how to file an objection; after
listing the date, time, and location of the settlement
hearing, that notice instructed Lawler that class members
could make their objections known "by filing a written
objection and/or by appearing at the settlement hearing."
Thus, the short-form notice did not merely contain a general
statement informing class members of their right to file an
objection that would have required them to make further
inquiry to discover the process for doing so; rather, for all
that appears, the notice contained all that information.
Lawler's action in waiting to file an objection until after
the July 22, 2016, deadline set by the trial court was
consistent with the short-form notice he was sent telling him
that he could object to the proposed settlement "by filing a
written objection and/or by appearing at the settlement
hearing."6 This Court has explained that due process is
6Class counsel emphasizes that Lawler never filed an
affidavit or gave testimony regarding what he understood the
short-form notice to mean. However, the necessity for such
evidence is not needed in this case, where the language of the
notice is undisputed and speaks for itself.
21
1151347, 1160049, 1160158
fundamentally about fair play, see, e.g., Industrial Chem. &
Fiberglass Corp. v. Chandler, 547 So. 2d 812, 835 (Ala. 1988)
(on application for rehearing), and it would hardly be fair of
this Court or comport with notions of due process to punish
Lawler for acting in accordance with the notice actually
provided to him.
It is notable, moreover, that the relevant language in
the short-form notice sent to Lawler was not the language
approved by the trial court; rather, it is language that was
unilaterally added to the short-form notice by class counsel.
Although class counsel asserts that they were attempting to
resolve a different perceived ambiguity in the language
approved by the trial court when they added the language, any
ambiguity that was a product of that change should be
construed against class counsel under the doctrine of contra
proferentem. See Jehle-Slauson Constr. Co. v. Hood-Rich
Architects & Consulting Eng'rs, 435 So. 2d 716, 720 (Ala.
1983) (explaining that under the doctrine of contra
proferentem an ambiguity in a writing is construed against the
drafting party responsible for the ambiguity).
We
accordingly
find no merit in class counsel's argument that Lawler's appeal
22
1151347, 1160049, 1160158
should be dismissed on the basis of his allegedly untimely
objection, and, to the extent it overruled Lawler's objections
on that basis, the trial court exceeded its discretion in
doing so.
Having concluded that Lawler's appeal is properly before
this Court, we now turn to the merits of his arguments. He,
and the other objectors as well, argues that the schedule set
by the trial court provided insufficient opportunity for
class
members to object to class counsel's attorney-fee application
because that schedule required them to state their objections
by July 22, 2016, even though class counsel was not required
to file its attorney-fee application, and did not in fact do
so, until July 29, 2016.7 At least four United States Courts
of Appeals have indicated that such a schedule is problematic;
however, their holdings largely relied on the language of Rule
23(h), Fed. R. Civ. P., which has no counterpart in the
7The objectors have also all noted that the trial court's
June 1 order required class counsel to place their attorney-
fee application on the settlement Web site by June 17, but
class counsel failed to do so. Class counsel argues that this
requirement was mistakenly included in the June 1 order and
that the trial court always intended for the attorney-fee
application to be filed and made public on July 29. The trial
court indicated in a hearing conducted to consider Walker's
Rule 59(e) motion that class counsel's position on this point
is correct.
23
1151347, 1160049, 1160158
Alabama Rules of Civil Procedure. See Keil v. Lopez, 862 F.3d
685, 705 (8th Cir. 2017), In re National Football League
Players Concussion Injury Litig., 821 F.3d 410, 446 (3d Cir.
2016), Redman v. RadioShack Corp., 768 F.3d 622, 638 (7th Cir.
2014), and In re Mercury Interactive Corp. Sec. Litig., 618
F.3d 988, 994 (9th Cir. 2010). Rule 23(h), Fed. R. Civ. P.,
provides, in relevant part:
"In a certified class action, the court may award
reasonable attorney's fees and nontaxable costs that
are authorized by law or by the parties' agreement.
The following procedures apply:
"(1) A claim for an award must be made by
motion under Rule 54(d)(2), subject to the
provisions of this subdivision (h), at a
time the court sets. Notice of the motion
must be served on all parties and, for
motions by class counsel, directed to class
members in a reasonable manner.
"(2) A class member, or a party from whom
payment is sought, may object to the
motion."
Even though Alabama's Rule 23 has no equivalent to Federal
Rule 23(h), courts considering whether Federal Rule 23(h) has
been violated have generally recognized that there is a
concomitant due-process issue as well. See, e.g., Mercury,
618 F.3d at 993 ("We hold that the district court abused its
discretion when it erred as a matter of law by misapplying
24
1151347, 1160049, 1160158
Rule 23(h) in setting the objection deadline for class members
on a date before the deadline for lead counsel to file their
fee motion. Moreover, the practice borders on a denial of due
process because it deprives objecting class members of a full
and fair opportunity to contest class counsel's fee
motion.").
Indeed, it would seem that the requirement in Federal Rule
23(h)(2) that class members be given an opportunity to object
to class counsel's request for attorney fees is essentially a
codification of basic due-process principles. As this Court
has explained:
"Procedural due process, as guaranteed by the
Fourteenth
Amendment
to
the
United
States
Constitution and Article I, § 6, of the Alabama
Constitution of 1901, broadly speaking, contemplates
the rudimentary requirements of fair play, which
include a fair and open hearing before a legally
constituted court or other authority, with notice
and the opportunity to present evidence and
argument, representation by counsel, if desired, and
information as to the claims of the opposing party,
with reasonable opportunity to controvert them."
Ex parte Weeks, 611 So. 2d 259, 261 (Ala. 1992) (emphasis
added). See also Mullane v. Central Hanover Bank & Trust Co.,
339 U.S. 306, 314 (1950) ("An elementary and fundamental
requirement of due process in any proceeding which is to be
accorded finality is notice reasonably calculated, under all
25
1151347, 1160049, 1160158
the circumstances, to apprise interested parties of the
pendency of the action and afford them an opportunity to
present their objections." (emphasis added)).
As Ex parte Weeks and Mullane explain, a fundamental
element of due process is allowing parties that will be bound
by a court's decision to have a reasonable opportunity to make
their position and any objections known. As the federal
appellate courts that have rejected the practice of requiring
class members to object to class counsel's attorney-fee
requests before those requests are filed have concluded, that
opportunity is not provided under those circumstances. The
facts in Mercury are particularly similar to the facts in the
instant case. In Mercury, the settlement notice sent to class
members informed class members that class counsel would
request the award of an attorney fee equal to 25% of the
$117.5 million settlement fund, or $29.375 million. 618 F.3d
at 990. Class members were given until September 4, 2008, to
file written objections to any element of the proposed
settlement; two objections to the potential attorney fee were
filed by that date. Id. at 991. Class counsel, however, in
compliance with the schedule set by the trial court, did not
26
1151347, 1160049, 1160158
file its formal application for an attorney fee and supporting
documentation until September 18, 2008. On September 25,
2008, the trial court held a fairness hearing and approved the
requested attorney fee, overruling the two objections that had
been filed. Id. After one of those objectors appealed, the
United States Court of Appeals for the Ninth Circuit held that
the schedule ordered by the trial court was unlawful,
explaining:
"Moore's Federal Practice counsels that '[a]ny
objection deadline set by the court should provide
the eligible parties with an adequate opportunity to
review all of the materials that may have been
submitted in support of the motion and, in an
appropriate case, conduct discovery concerning the
fees request.' 5 Moore's Federal Practice §
23.124[4] (Matthew Bender 3d ed. 2009). Allowing
class members an opportunity thoroughly to examine
counsel's fee motion, inquire into the bases for
various charges and ensure that they are adequately
documented and supported is essential for the
protection of the rights of class members. It also
ensures that the district court, acting as a
fiduciary for the class, is presented with adequate,
and adequately-tested, information to evaluate the
reasonableness of a proposed fee.
"In this case, [the objectors were] denied such
an opportunity. At the time that [their] objections
to the fee request were due, [the objectors] could
make only generalized arguments about the size of
the total fee because they were only provided with
generalized information. [The objectors] could not
provide the court with critiques of the specific
work done by counsel when they were furnished with
27
1151347, 1160049, 1160158
no information of what that work was, how much time
it consumed, and whether and how it contributed to
the benefit of the class.
"During the fee-setting stage of common fund
class action suits such as this one, '[p]laintiffs'
counsel, otherwise a fiduciary for the class, ...
become[s] a claimant against the fund created for
the benefit of the class.' Class Plaintiffs v. City
of Seattle (In re Wash. Pub. Power Supply Sys. Sec.
Litig.), 19 F.3d 1291, 1302 (9th Cir. 1994)
(internal quotation marks omitted). This shift puts
plaintiffs' counsel's understandable interest in
getting paid the most for its work representing the
class at odds with the class' interest in securing
the largest possible recovery for its members.
Because 'the relationship between plaintiffs and
their attorneys turns adversarial at the fee-setting
stage, courts have stressed that when awarding
attorneys' fees from a common fund, the district
court must assume the role of fiduciary for the
class plaintiffs.' Id. As a fiduciary for the
class, the district court must 'act with "a jealous
regard to the rights of those who are interested in
the fund" in determining what a proper fee award
is.' Id. Included in that fiduciary obligation is
the duty to ensure that the class is afforded the
opportunity to represent its own best interests.
When the district court sets a schedule that denies
the class an adequate opportunity to review and
prepare objections to class counsel's completed fee
motion,
it
fails
to
fulfill
its
fiduciary
responsibilities to the class."
Mercury, 618 F.3d at 994-95. The Court of Appeals for the
Ninth Circuit accordingly vacated the order approving the fee
request and remanded the matter to the trial court, which
thereafter issued new notice to class members informing them
28
1151347, 1160049, 1160158
that a renewed motion seeking an award of attorney fees would
be filed by December 14, 2010, that any objections to that
motion were required to be filed by January 13, 2011, and that
a final hearing would be held February 18, 2011. In re
Mercury Interactive Corp. Sec. Litig., (No. 5:05-CV-03395-JF,
March 3, 2011) (N.D. Cal.) (unpublished order).8
Although the Court of Appeals for the Ninth Circuit in
Mercury couched its holding in terms of Federal Rule 23(h),
its logic similarly applies in this case, where class members
were informed on June 17, 2016, that class counsel would seek
an attorney fee of up to 40% of the settlement fund and that
any objections to whatever attorney fee class counsel
ultimately sought had to be filed by July 22, 2016, even
though class counsel was not required to file its actual
attorney-fee application until one week later on July 29,
2016. Class counsel argues that class members were given
notice that class counsel would be requesting an attorney fee
of up to 40% before objections were due; thus, class counsel
argues, class members were not harmed by the schedule because
8On remand, class counsel agreed to lower its requested
attorney fee and the previous objectors withdrew their
objections.
29
1151347, 1160049, 1160158
they could still file timely objections to that expected
request
without
having
seen
the
actual
attorney-fee
application. This argument, however, fails to acknowledge
that potential objectors were limited to making only general
objections under these circumstances. As the United States
Court of Appeals for the Seventh Circuit explained in Redman,
768 F.3d at 638:
"From reading the proposed settlement the objectors
knew that class counsel were likely to ask for $1
million
in
attorneys'
fees,
but
they
were
handicapped in objecting because the details of
class counsel's hours and expenses were submitted
later, with the fee motion, and so they did not have
all the information they needed to justify their
objections. The objectors were also handicapped by
not knowing the rationale that would be offered for
the fee request, a matter of particular significance
in
this
case
because
of
the
invocation
of
administrative
costs
as
a
factor
warranting
increased fees. There was no excuse for permitting
so irregular, indeed unlawful, a procedure."
See also Mercury, 618 F.3d at 994 ("At the time that [their]
objections to the fee request were due, [the objectors] could
make only generalized arguments about the size of the total
fee because they were only provided with generalized
information. [The objectors] could not provide the court with
critiques of the specific work done by counsel when they were
furnished with no information of what that work was, how much
30
1151347, 1160049, 1160158
time it consumed, and whether and how it contributed to the
benefit of the class.").
We agree with the rationales of these courts and,
especially, the conclusion in Redman that this type of
procedure is "irregular [and] indeed unlawful." Redman, 768
F.3d at 638. The class members in this case were not afforded
due process inasmuch as they were not allowed to view,
consider, and respond to class counsel's attorney-fee
application before they were required to file any objections
to that application. See Ex parte Weeks, 611 So. 2d at 261
(holding that due process requires that parties be given
information regarding the claims of an opposing party and a
reasonable
opportunity
to
controvert
them).
It
is
insufficient that class members had an opportunity to file a
general objection to what they anticipated class counsel might
request as an attorney-fee award; principles of due process
require that they have an opportunity to respond to the
attorney-fee application that is actually filed. The long-
form notice in fact promised class members this opportunity
inasmuch as it stated that "[a]ny class member may object to
the proposed settlement, the plan of allocation, the fee and
31
1151347, 1160049, 1160158
expense application and/or incentive awards."9 In authorizing
a schedule requiring class members to object to class
counsel's requested attorney fee before class counsel filed
its attorney-fee application, the trial court acted beyond its
discretion and
violated
the
class
members'
due-process rights.
The trial court's error being established, however, we
must still consider whether that error was harmless. See Rule
45, Ala. R. App. P. ("No judgment may be reversed or set aside
... for error as to any matter of pleading or procedure,
unless in the opinion of the court to which the appeal is
taken or application is made, after an examination of the
entire cause, it should appear that the error complained of
has probably injuriously affected substantial rights of the
parties."), and Keil, 862 F.3d at 705-06 (concluding that
trial court's error in setting the deadline for objections
before the deadline for class counsel to file their fee motion
was harmless under the circumstances). Class counsel, in
9The long-form notice posted on June 17, 2016, also
advised class members that "the fee and expense application,
together with selected pleadings and other settlement-related
documents
may
be
viewed
online
at
www.aig-
caremarkclassaction.com." However, as explained, the fee and
expense application was not actually posted until it was filed
on July 29, 2016.
32
1151347, 1160049, 1160158
fact, has argued that any error in the timing of the filing of
its fee and expense application was harmless because Walker
and the Georgia Urology claimants filed additional motions
with the trial court explaining their objections after class
counsel filed its application, and Walker and Lawler also
presented arguments orally at the August 8 hearing. In
Cassese v. Williams, 503 F. App'x 55, 58 (2d Cir. 2012) (not
selected for publication in Federal Reporter), the United
States Court of Appeals for the Second Circuit declined to
follow the rationale of the Mercury court at least partially
for this reason, explaining:
"In its ... fee motion, class counsel requested fees
and costs in the precise amounts specified in the
settlement
notice
and
divulged
additional
information regarding counsel's billing rates, hours
worked, and tasks performed. Any objectors then had
two weeks to crystallize their objections and
request further information before attending the
fairness hearing. With the objectors here having
availed themselves of those opportunities, we
identify no abuse of discretion or due process
denial in that portion of the district court's
scheduling order relating to the fee motion."
See also Keil, 862 F.3d at 705 (holding that the trial court
erred in closing objections before class counsel's attorney-
fee application was filed but that that error was harmless
because the objectors subsequently had an opportunity to
33
1151347, 1160049, 1160158
respond to the specific arguments contained within class
counsel's fee application).
We decline, however, to find the error in this case
harmless. We first note that the interval between class
counsel's filing of its application for an attorney fee and
the subsequent fairness hearing was only 10 days –– 5 business
days. Although class counsel has cited several published
opinions in which courts have approved of schedules such as
the one being challenged in this case, none of those opinions
involved as short an interval between the time the attorney-
fee application was filed and the settlement hearing as in
this case. See, e.g., CertainTeed Fiber Cement Siding
Litig., 303 F.R.D. 199, 222 (E.D. Pa. 2014) (three weeks), and
Saccoccio v. JP Morgan Chase Bank, N.A., 297 F.R.D. 683, 699
(S.D. Fla. 2014) (two weeks). Like the Keil court, "[w]e do
not purport to decide how much time after the fee motion
deadline is sufficient to provide class members with an
adequate opportunity to object to the motion," 862 F.3d at
705; however, the short interval provided class members in
this case surely borders on what due process requires.
34
1151347, 1160049, 1160158
Additionally, we note that in most of the cases that have
been brought to this Court's attention in which a court has
rejected an objector's arguments concerning a schedule
requiring the objector to object to an attorney-fee
application before that application is actually filed, the
ruling court has noted that the objector ultimately was
provided access to detailed information about the
hours worked
by class counsel, along with descriptions of the specific
tasks class counsel performed during those hours, and then had
at least some opportunity to respond to that information.
See, e.g., Keil, 862 F.3d at 701 (noting that "the hours and
rates submitted by class counsel were reasonable"); Cassese,
503 F. App'x at 58 (noting that class counsel's fee
application
"divulged
additional
information
regarding
counsel's billing rates, hours worked, and tasks performed");
and CertainTeed, 303 F.R.D. at 223 (noting that "[c]lass
counsel have spent over 12,656 hours in prosecuting this case
on behalf of the settlement class"). In this case, however,
the class was never provided such information. Class counsel
stated in its attorney-fee application that the amount of time
it expended on this case was irrelevant or of only minor
35
1151347, 1160049, 1160158
importance, and it repeats that claim on appeal, arguing that
this Court in Edelman & Combs v. Law, 663 So. 2d 957, 959
(Ala. 1995), held that "in a class action where the plaintiff
class prevails and the lawyer's efforts result in a recovery
of a fund, by way of settlement or trial, a reasonable
attorney fee should be determined as a percentage of the
amount agreed upon in settlement or recovered at trial."
However, although it is true that Edelman warns trial courts
against "a strict reliance" on the time-expended factor when
awarding an attorney fee in a common-fund case, 663 So. 2d at
960, it is not accurate to say that Edelman declared the time-
expended factor to be irrelevant in common-fund cases. To the
contrary, Edelman states:
"We hold that the lawyers representing the
plaintiff class in this case are entitled to a
reasonable
percentage
of
the
amount
of
the
settlement. In determining that percentage, the
trial court should consider all relevant factors,
including the number of hours expended on behalf of
the class. Several factors, including the number of
lawyers who were actively engaged for over four
years in the handling of the claims, the complexity
of the litigation, as well as the management
responsibilities inherent in a class action, and the
result obtained, would justify a[n] award of an
amount between 20% and 33 1/3% of the amount of the
settlement. However, the plaintiffs' attorneys did
not introduce any evidence of the actual time spent
on behalf of the class. The trial court should
36
1151347, 1160049, 1160158
consider that factor in determining the appropriate
percentage to be awarded in this case."
663 So. 2d at 961 (emphasis added.)10
Class counsel notes also, however, that the trial court
has stated that it had seen the thousands of hours of time
expended by class counsel over the many years this case has
been pending and that it did not need time sheets to conclude
that the time class counsel spent on the case weighed in favor
of the $124 million award. However, although the trial court
certainly has some personal knowledge of the time expended by
class counsel in this case, Lawler argues that the facts of
this case demand a closer examination of those hours.
Specifically, he argues that much of the time expended by
class counsel in this case, and the corresponding delay in
reaching a final resolution, is due to class counsel's own
missteps and questionable decisions. As examples, Lawler
notes that it was class counsel that was initially "duped" in
the original settlement of the MedPartners class action, that
class counsel's unsuccessful attempt to avoid the class-
certification process, as detailed in Ex parte Caremark RX,
10This Court has listed factors relevant to determining
the reasonableness of attorney fees in Peebles v. Miley, 439
So. 2d 137, 140-41 (Ala. 1983).
37
1151347, 1160049, 1160158
Inc., 956 So. 2d 1117 (Ala. 2006), added years of delay and
additional expenses to the litigation, that much of the other
time expended by class counsel in this case was devoted to
class counsel's efforts defending themselves from attempts to
disqualify them and from other attorneys seeking to replace
them as a result of class counsel's previous decisions, and
that class counsel's efforts of late have been directed toward
avoiding a meaningful review of their requested attorney fee
to the express detriment of the class.
Lawler argues that the time expended on those efforts
cannot be used by class counsel to justify an attorney fee
because, he argues, that time did not benefit the class; class
counsel, however, argues that the $310 million settlement they
ultimately negotiated demonstrates that those efforts all
benefited the class. Without deciding this issue, we agree
with Lawler that the class members are entitled to more
information about the amount of time class counsel expended in
this case and the manner in which that time was spent. As
explained in Edelman, 663 So. 2d at 961, the amount of time
expended on behalf of the class is still a relevant factor
that should be considered when determining a reasonable
38
1151347, 1160049, 1160158
attorney fee in a class-action case. Accordingly, class
members are entitled to basic information in that regard so
they can adequately argue any objections they have, as is
their due-process right. On remand, the trial court should
direct a process whereby that information is provided to the
objectors; the objectors subsequently are provided with
adequate time to restate their objections in light of that
information; and the trial court then considers those
objections and enters a new order awarding an attorney fee.11
Our resolution of this issue obviates the need to conduct our
own review of the reasonableness of the awarded attorney fee
at this time, as well as the need to consider the other issues
raised by Lawler and the other objectors.12
11We further note that the information Lawler and the
other objectors seek regarding the time class counsel has
spent on this case will also better allow this Court to
conduct a "meaningful review," Wehle v. Bradley, 195 So. 3d
928, 946 (Ala. 2015), of the attorney fee awarded on remand if
class counsel and the objectors are unable to resolve their
dispute and a subsequent appeal is necessary.
12Walker and the Georgia Urology claimants have argued in
their
appeals
that
the
trial
court
wrongfully
took
consideration of their claims from Gilardi and
determined that
those claims were not valid. Because we have already
determined that remand is appropriate, we decline to consider
those arguments at this time. Appellate review in a piecemeal
fashion is generally disfavored, Dzwonkowski v. Sonitrol of
Mobile, Inc., 892 So. 2d 354, 363 (Ala. 2004), and Walker and
39
1151347, 1160049, 1160158
IV.
After class counsel negotiated a $310 million settlement
with Caremark and its insurer resolving class members' fraud
and suppression claims stemming from the previous settlement
of the MedPartners class action, the objectors filed notice
with the trial court that they objected to class counsel's
request that 40% of the settlement, or $124 million, be paid
to them as an attorney fee. The trial court thereafter
overruled those objections and entered an order awarding class
counsel the $124 million attorney fee they had requested. The
objectors subsequently separately appealed that award to this
Court, arguing that they had been given insufficient
opportunity to object to class counsel's requested attorney
fee inasmuch as their objections were due before class
counsel's attorney-fee application was filed, and that the
attorney fee ultimately awarded was excessive. We agree with
Lawler's and the other objectors' argument that a schedule
the Georgia Urology claimants can present their arguments
regarding their claims to the trial court again on remand
along with their objections regarding class counsel's
attorney-fee application. Should an issue in that regard
still exist after the trial court enters a new order making an
award of attorney fees, Walker and the Georgia Urology
claimants may argue them on appeal, along with any objections
they have to that new attorney-fee award.
40
1151347, 1160049, 1160158
requiring class members to object to class counsel's attorney-
fee request before any such request is formally made violates
class members' due-process rights. Furthermore, we
agree with
Lawler that the objectors were entitled to more information
from class counsel about the time expended on this case in
order to allow them to properly articulate their objections.
Accordingly, we now vacate the order entered by the trial
court awarding class counsel an attorney fee of $124 million.
On remand, class counsel may file a new attorney-fee
application,
including
more
detailed
information
regarding
the
time expended in this case and how that time was spent. The
objectors shall then be given a reasonable opportunity to
review that application and may, if they still have objections
to class counsel's new application, file those objections with
the trial court. After the trial court considers those
objections and enters a new order making an award of attorney
fees, any party with a grievance may file a new appeal with
this Court.
1151347 –– ORDER VACATED AND CASE REMANDED.
1160049 –– ORDER VACATED AND CASE REMANDED.
1160158 –– ORDER VACATED AND CASE REMANDED.
Shaw, Wise, and Sellers, JJ., concur.
Parker, J., concurs in the result.
41 | October 20, 2017 |
a5ed06be-bfb6-4849-9eff-c98beae2cda9 | Slamen v. Slamen | N/A | 1160578 | Alabama | Alabama Supreme Court | Rel: 09/22/2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
SPECIAL TERM, 2017
____________________
1160578
____________________
Darlene Slamen, Charles Martin, Wilhelmina Martin, and
Harris Partnership, LLP
v.
Herbert A. Slamen
Appeal from Jefferson Circuit Court
(CV-16-904003)
BRYAN, Justice.
Darlene Slamen ("Darlene"), Charles Martin ("Charles"),
Wilhelmina Martin ("Wilhelmina"), and Harris Partnership, LLP
("Harris LLP") (hereinafter collectively referred to as "the
1160578
defendants"), appeal from an order of the Jefferson Circuit
Court ("the trial court") granting a motion for a preliminary
injunction filed by Herbert A. Slamen ("Herbert"). For the
reasons set forth herein, we reverse and remand.
Facts and Procedural History
Herbert and Darlene married in 1981 and later formed
Harris LLP, of which Herbert, Darlene, Charles, and
Wilhelmina
each own a 25% share. In 2008, Herbert was diagnosed with
chronic obstructive pulmonary disease, and, in 2010, he moved
to Thailand because, Darlene said, he wanted "to enjoy what
remained of his life." After moving to Thailand, Herbert was
dependent upon Darlene to send him the proceeds generated from
his assets so that he could pay for living expenses and
medical treatment. Payments in an agreed amount were
deposited in a checking account in Thailand set up in
Herbert's name. In addition to his interest in Harris LLP,
Herbert's assets include a house in Alabama, a house in
Florida, and an interest in the dental practice from which
Herbert had retired. In 2013, Herbert, via his attorney in
fact, established the Herbert A. Slamen Revocable Living Trust
("the trust") to facilitate the management of his assets, and
2
1160578
he thereafter transferred his assets, including his interest
in Harris LLP, to the trust. Herbert was the beneficiary of
the trust, and both he and Darlene were the appointed
cotrustees.
On October 27, 2016, Herbert sued the defendants,
alleging that he had revoked the trust but that Darlene,
purportedly under
her
authority
as
cotrustee,
had
nevertheless
transferred the assets of the trust to herself. As a result,
Herbert alleged, the defendants had "failed to distribute
proceeds from [Harris LLP] to [Herbert] and instead made all
payments directly to Darlene." Herbert also alleged that
Darlene had sold the Alabama and Florida houses and that she
had "benefitted financially" from the operation of the dental
practice, but,
the
allegation
continued,
Herbert
had
"realized
no proceeds" from those assets. According to Herbert,
Darlene's allegedly unauthorized transfer of his assets to
herself and her alleged refusal to send him the proceeds
generated from his assets were part of "an illicit scheme to
gather all of [his] assets for herself." Given those
allegations, Herbert asserted claims of breach of a fiduciary
duty, negligence, fraud, conversion, conspiracy, intentional
3
1160578
infliction
of
emotional distress, identity
theft,
and
tortious
interference with a business relationship. As
relief, Herbert
sought compensatory and punitive damages and, for the breach-
of-a-fiduciary-duty claim, specifically sought "damages in an
amount equal to the proceeds properly due from [his] business
interests."
On February 9, 2017, Herbert filed a motion for a
preliminary injunction in which he requested that the trial
court enjoin the defendants "from disbursing funds and
profits
from [Harris LLP] and requiring [the defendants] to keep all
funds and profits in the regular business account of [Harris
LLP] until the resolution of this case."1 In his motion,
Herbert alleged that he would suffer irreparable injury in the
absence of an injunction because, he said, "[s]hould [the
defendants] be allowed to distribute profits [of Harris LLP]
among themselves, those funds, some or all of which rightfully
belong to [Herbert], will instantly become unreachable" and
"would no longer be attainable to satisfy any judgment [he]
may receive." Following a hearing, the trial court entered an
order enjoining the defendants "from disbursing funds and
1Herbert did not request injunctive relief with respect
to any other assets.
4
1160578
profits of [Harris LLP]," except as necessary for ordinary
business expenses, pending resolution of Herbert's claims.
The defendants timely appealed. See Rule 4(a)(1)(A), Ala. R.
App. P. (providing for an appeal from an interlocutory order
granting injunctive relief).
Standard of Review
"When this Court reviews the grant or denial of
a preliminary injunction, '"[w]e review the ...
[c]ourt's legal rulings de novo and its ultimate
decision to issue the preliminary injunction for [an
excess] of discretion."' Holiday Isle, LLC v.
Adkins, 12 So. 3d 1173, 1176 (Ala. 2008) (quoting
Gonzales v. O Centro Espirita Beneficente Uniao do
Vegetal, 546 U.S. 418, 428, 126 S.Ct. 1211, 163
L.Ed.2d 1017 (2006)).
"'A preliminary injunction should be
issued only when the party seeking an
injunction demonstrates:
"'"'(1)
that
without
the
injunction
the
[party]
would
suffer irreparable injury; (2)
that the [party] has no adequate
remedy at law; (3) that the
[party] has at least a reasonable
chance of success on the ultimate
merits of his case; and (4) that
the hardship
imposed
on
the
[party opposing the preliminary
injunction] by the injunction
would not unreasonably outweigh
the
benefit
accruing
to
the
[ p a r t y
s e e k i n g
t h e
injunction].'"'
5
1160578
"Holiday Isle, 12 So. 3d at 1176 (quoting Ormco
Corp. v. Johns, 869 So. 2d 1109, 1113 (Ala. 2003),
quoting in turn Perley v. Tapscan, Inc., 646 So. 2d
585, 587 (Ala. 1994) (alterations in Holiday Isle)).
Monte Sano Research Corp. v. Kratos Defense & Sec. Sols.,
Inc., 99 So. 3d 855, 861-62 (Ala. 2012).
Discussion
On appeal, the defendants argue that Herbert was not
entitled to a preliminary injunction because, they say, he
failed to show that he would suffer irreparable injury in the
absence of an injunction. We agree.
"'"'Irreparable injury' is an injury that is not
redressable in a court of law through an award of money
damages."'" Monte Sano Research Corp., 99 So. 3d at 862
(quoting Ormco Corp. v. Johns, 869 So. 2d 1109, 1113 (Ala.
2003), quoting other cases). "A plaintiff that can recover
damages has an adequate remedy at law and is not entitled to
an injunction." Id. Thus, where a plaintiff alleges a purely
monetary loss and seeks only to recover damages for that
alleged loss, the injury is not irreparable because the
monetary damages the plaintiff seeks constitute an adequate
remedy at law. In such circumstances, injunctive relief is
improper. See SouthTrust Bank of Alabama, N.A. v. Webb-Stiles
6
1160578
Co., 931 So. 2d 706, 711-12 (Ala. 2005) ("Webb–Stiles's only
alleged loss is monetary. Because it has an adequate remedy
at law, Webb–Stiles has not established that it is entitled to
a preliminary injunction."); Ex parte B2K Sys., LLC, 162 So.
3d 896 (Ala. 2014) (holding that monetary damages were an
adequate legal remedy, and thus precluded injunctive relief,
where the plaintiff alleged that the defendants were indebted
to her pursuant to a contractual agreement); Woodward v.
Roberson, 789 So. 2d 853, 856 (Ala. 2001) (holding that the
plaintiffs failed to demonstrate an irreparable injury where
they sought to recover lost salary for the allegedly unlawful
termination of their employment because, "[c]learly, an award
of money damages provides an adequate remedy for a loss of
earnings"); and Alabama Lock & Key Co. v. Birmingham Lock &
Key, Inc., 557 So. 2d 1240, 1242 (Ala. 1990) (holding that
"testimony as to loss of business ... did not rise to a
showing of immediate and irreparable injury" and noting that
"damages are available and the plaintiff therefore has an
adequate remedy at law").
In this case, Herbert's complaint alleges that the
defendants divested him of the proceeds generated from his
7
1160578
assets and sought only to recover monetary damages for that
alleged injury.2 That is to say, Herbert's "only alleged loss
is monetary." SouthTrust Bank, supra. Thus, if Herbert is
able to prove that the defendants did in fact wrongfully
divest him of the proceeds generated from his assets, the
monetary damages he seeks will adequately redress his alleged
economic injury. Accordingly, Herbert's alleged injury is
not
irreparable. Monte Sano Research Corp., supra; SouthTrust
Bank, supra; Ex parte B2K, supra; Woodward, supra; and Alabama
Lock & Key, supra. See also Southland Corp. v. Godette, 793
F. Supp. 348, 351 (D.D.C. 1992) ("Southland's injuries are at
bottom economic: its contractual share of the gross profits
2We
note
that
the
initial
paragraph of
Herbert's complaint
indicates that he is seeking "compensatory damages, equitable
relief, and such other relief deemed just and proper" and that
the identity-theft claim
seeks monetary damages and "all other
further and general relief, whether compensatory, punitive,
equitable or injunctive relief as [the trial court] or the
jury may deem just and appropriate." However, aside from that
general boilerplate language, nowhere in the complaint does
Herbert request permanent injunctive relief as an alternate
remedy to the monetary damages he seeks. See Rosen v. Cascade
Int'l, Inc., 21 F.3d 1520, 1526 n. 12 (11th Cir. 1994) ("We
reject the appellees' suggestion that they successfully
invoked the district court's equitable jurisdiction through
their requests for any additional relief as may appear 'just
and proper' at the conclusion of each complaint. The mere
incantation of such boilerplate language does not convert a
legal cause of action into a legitimate request for equitable
relief.").
8
1160578
from the operation of the 7–Eleven store .... It is
well-established 'that economic loss does not, in and of
itself, constitute irreparable harm.'" (quoting Wisconsin Gas
Co. v. Federal Energy Regulatory Comm'n, 758 F.2d 669, 674
(D.C. Cir. 1985))).
Furthermore, Herbert's mere allegation that, without the
injunction, the defendants might be unable to satisfy a
potential judgment remedying his alleged monetary loss does
not transform his injury into an irreparable one that
justifies injunctive relief. In Norman v.
Occupational Safety
Ass'n of Alabama Workmen's Compensation Fund, 811 So. 2d 492,
501 (Ala. 2001), the Occupational Safety Association of
Alabama Workmen's Compensation Fund ("the Fund") sued, among
other defendants, Riscorp National Insurance Company and
Riscorp,
Inc.
(those
two
entities
are
hereinafter
collectively
referred to as "Riscorp"), Peter D. Norman, and Thomas
Albrecht seeking payments the Fund alleged Riscorp was
obligated to make. In conjunction with its complaint, the
Fund sought an order enjoining Riscorp from disbursing
proceeds to Norman and Albrecht for their transfers of Riscorp
stock back to Riscorp. According to the Fund, a preliminary
9
1160578
injunction was necessary because, it said, "'there is a risk
that [Norman and Albrecht] will conceal, transfer, spend or
otherwise dispose of this money and that the Fund will not be
able to get it from them at the conclusion of this case.'"
811 So. 2d at 499. Following a hearing, the trial court
entered a preliminary injunction. In reversing the order
granting the preliminary injunction, this Court stated:
"[B]y seeking the proceeds ..., the Fund is actually
seeking money damages rather than equitable relief.
Therefore, we conclude that, because the underlying
claims are for money damages, the trial court lacked
the authority under Rule 65, Ala. R. Civ. P., to
enjoin Riscorp from disbursing the proceeds ...."
811 So. 2d at 501 (emphasis added). Thus, the Fund's
allegation that it might obtain an uncollectible judgment did
not convert its reparable injury –- an alleged monetary loss
–- into an irreparable injury justifying injunctive relief.
See also Chunchula Energy Corp. v. Ciba-Geigy Corp., 503 So.
2d 1211 (Ala. 1987) (reversing an order granting injunctive
relief and requiring the defendants to set aside funds to
satisfy a potential judgment despite the fact that evidence
indicated that failure to enter the preliminary injunction
would leave the
defendants with insufficient assets with which
to satisfy the potential judgment).
10
1160578
In Hinton v. Rolison, 175 So. 3d 1252 (Miss. 2015),
Clayton Hinton and Nate Rolison were business partners who
operated a used-car business. Hinton and Rolison had engaged
Credit
Acceptance
Corporation
("Credit
Acceptance")
to
provide
financing to their customers, and Credit Acceptance made
payments to Hinton and Rolison when their customers financed
purchases. After a dispute arose in which Hinton alleged that
Rolison was "keeping profits from [the] business that should
be divided equally," Hinton sued Rolison for Hinton's share of
the business's profits and sought an order enjoining Credit
Acceptance
from
disbursing
funds
to
Rolison
pending
resolution
of Hinton's claims. 175 So. 3d at 1254. According to Hinton,
a preliminary injunction was necessary because, he said,
"'[f]ailure to hold all such funds in trust will result in
spending, using, wasting of the funds and prevent Hinton from
being compensated upon any future judgment.'" Id. at 1255.
However, despite Hinton's allegation that he might obtain an
uncollectible judgment, the Supreme Court of Mississippi
affirmed the dismissal of Hinton's request for injunctive
relief because it noted, among other flaws in Hinton's
request, that "the only harm Hinton has alleged is a loss of
11
1160578
money, and such a loss is reparable, not irreparable.
Hinton's damages suit against Rolison implicitly acknowledges
as much." Id. at 1260. Thus, as in Norman, a reparable
injury that could be redressed with monetary damages was not
rendered irreparable by the plaintiff's concern that any
judgment he might obtain would be uncollectible.
As evidenced by Norman and Hinton, when a plaintiff
alleges a purely monetary loss and seeks only to recover
monetary damages to redress that loss, the alleged injury is
reparable, and the plaintiff's mere allegation that, without
the issuance of an injunction, a defendant might be unable to
satisfy a potential judgment does not convert the plaintiff's
reparable injury into an irreparable one that justifies
injunctive relief. Indeed, to hold that a plaintiff is
entitled to an order enjoining a defendant from disposing of
assets pending resolution of the plaintiff's claims on the
mere allegation that the defendant might be unable to satisfy
a potential judgment would essentially make what has
heretofore been a "drastic remedy" available in most any
action in which a plaintiff seeks to recover monetary damages.
Monte Sano Research Corp., supra. See Grupo Mexciano de
12
1160578
Desarrollo, S.A. v. Alliance Bond Fund, Inc., 527 U.S. 308,
327 (1999) (noting that affirming a preliminary injunction
restricting a defendant's use of assets pending resolution of
a plaintiff's claims "'on a mere statement of belief that the
defendant can easily make away with or transport his money or
goods'" would "'create a precedent of sweeping effect'" that
would make it "'difficult to see why a plaintiff in any action
for a personal judgment in tort or contract may not, also,
apply
to
the
chancellor
for
a
so-called
injunction
sequestrating his opponent's assets pending recovery and
satisfaction of a judgment in such a law action'" (quoting De
Beers Consol. Mines v. United States, 325 U.S. 212, 222-23
(1945))).
Here, as noted, the underlying causes of action asserted
in Herbert's complaint are actions at law that allege only a
monetary loss and seek only to recover monetary damages for
that alleged loss. Thus, Herbert's alleged injury is not
irreparable, given that it can be adequately redressed with
the monetary damages he seeks if he is able to prove that the
defendants wrongfully divested him of the proceeds generated
from his assets. Monte Sano Research Corp., supra; SouthTrust
13
1160578
Bank, supra; Ex parte B2K, supra; Woodward, supra; and Alabama
Lock & Key, supra. Nor is Herbert's alleged injury rendered
irreparable
by
Herbert's
allegation
that,
without
a
preliminary injunction, the defendants might be unable to
satisfy any judgment he might obtain. Norman, supra; Hinton,
supra. Accordingly, because his alleged injury is not
irreparable, Herbert was not entitled to injunctive relief.
Monte Sano Research Corp., supra.
Conclusion
The trial court erred in entering an order enjoining the
defendants from disbursing the profits of Harris LLP pending
resolution of Herbert's claims. Accordingly, we reverse the
order granting the preliminary injunction and remand the case
with instructions that the trial court dissolve the
preliminary injunction.3
REVERSED AND REMANDED WITH INSTRUCTIONS.
Stuart, C.J., and Bolin and Main, JJ., concur.
Murdock, J., concurs in the result.
3The defendants raise other grounds for reversal. Given
our disposition of the appeal, we need not address those
grounds. We note, however, that a preliminary injunction must
be supported by "'some type of evidence which substantiates
the pleadings.'" Colbert Cty. Bd. of Educ. v. James, 83 So.
3d 473, 482 (Ala. 2011) (quoting Bamberg v. Bamberg, 441 So.
2d 970, 971 (Ala. Civ. App. 1983)).
14 | September 22, 2017 |
cf88a69a-68c9-4f5d-8a38-a1ded43d06f2 | Ex parte Dr. Eyston Hunte | N/A | 1160164 | Alabama | Alabama Supreme Court | Rel: 09/01/2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
SPECIAL TERM, 2017
____________________
1160164
____________________
Ex parte Dr. Eyston A. Hunte and Eyston A. Hunte, M.D., P.A.
PETITION FOR WRIT OF MANDAMUS
(In re: Lisa S. Johnson
v.
Dr. Eyston A. Hunte and Eyston A. Hunte, M.D., P.A.)
(Mobile Circuit Court, CV-14-902102)
MAIN, Justice.
Dr. Eyston A. Hunte and Eyston A. Hunte, M.D. P.A.
("EAH"), petition this Court for a writ of mandamus directing
1160164
the Mobile Circuit Court to vacate its order compelling
production of a complaint made to the Alabama Board of Medical
Examiners ("the Board") by a former patient of Hunte's. We
grant the petition and issue the writ.
I. Facts and Procedural History
On July 21, 2014, Lisa S. Johnson filed this action
against Hunte and EAH in the Mobile Circuit Court. In her
complaint, Johnson alleged that she had seen Hunte on July 23,
2012, for a routine health exam and that Hunte sexually abused
her during his examination. Johnson asserted claims of
negligence, wantonness, invasion of privacy, the tort of
outrage, negligent infliction of emotion distress, assault,
and violation of the Alabama Medical Liability Act, § 6-5-480
et seq. and § 6-5-540 et seq., Ala Code 1975 ("AMLA"), against
Hunte and EAH.
Johnson served discovery requests on Hunte and EAH, which
included a request to produce "each and every claim or
complaint that has been made against [Hunte] by a patient for
assault or inappropriate touching." Hunte objected to this
request on the ground that this information was protected from
2
1160164
discovery.1 Johnson filed a motion to compel Hunte and EAH to
produce the requested documents. Hunte and EAH, in turn,
filed a motion for a protective order. Hunte and EAH admitted
that Hunte possessed a document responsive to Johnson's
request for production –- a written complaint submitted to the
Board in 2001 by a former patient. They argued, however, that
this document was not discoverable because, among other
reasons, it was privileged under the provisions of § 34-24-60,
Ala. Code 1975. That section provides, in part, that "all
information, interviews, reports, statements, or memoranda of
any kind furnished to the [Alabama Board of Medical Examiners]
or any committee of the board ..., unless presented as
evidence at a public hearing, shall be privileged and
confidential, ... and shall not be public records nor be
available for court subpoena or for discovery proceedings."
In support of the motion, EAH and Hunte submitted Hunte's
affidavit. Hunte attested that the document was provided to
him by the Board during formal proceedings stemming from the
1Hunte initially objected to the discovery on the ground
that the information was not discoverable under § 6-5-551,
Ala. Code 1975, a provision of the AMLA that prohibits a
plaintiff from "conducting discovery with regard to any other
act or omission."
3
1160164
2001 complaint. Hunte further testified that the document had
never been published or made publicly available and that there
were no public hearings before the Board related to the 2001
complaint. Additionally, Hunte and EAH submitted the
document
under seal to permit the trial court to review the document in
camera.
On October 21, 2016, the trial court denied Hunte and
EAH's motion for a protective order and ordered Hunte and EAH
to respond to the discovery requests within 21 days. This
petition followed.
II. Standard of Review
"'Mandamus is an extraordinary remedy
and will be granted 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 Alfab, Inc., 586 So. 2d 889, 891
(Ala. 1991). In Ex parte Ocwen Federal
Bank, FSB, 872 So. 2d 810 (Ala. 2003), this
Court announced that it would no longer
review
discovery
orders
pursuant
to
extraordinary writs. However, we did
identify four circumstances in which a
discovery order may be reviewed by a
petition for a writ of mandamus. Such
circumstances arise (a) when a privilege is
disregarded, see Ex parte Miltope Corp.,
823 So. 2d 640, 644-45 (Ala. 2001) .... The
4
1160164
burden
rests
on
the
petitioner
to
demonstrate
that
its
petition
presents
such
an exceptional case--that is, one in which
an appeal is not an adequate remedy. See
Ex parte Consolidated Publ'g Co., 601 So.
2d 423, 426 (Ala. 1992).'
"Ex parte Dillard Dep't Stores, Inc., 879 So. 2d
1134, 1136-37 (Ala. 2003)."
Ex parte Fairfield Nursing & Rehab. Ctr., L.L.C., 22 So. 3d
445, 447 (Ala. 2009).
III. Analysis
Hunte and EAH argue that the document in question, a 2001
complaint submitted to the Board by a former patient, is not
discoverable for three reasons. First, they contend that the
document is privileged under § 34-24-60. Second, they contend
that Johnson's discovery request was not reasonably limited as
to time and that the 2001 document was far too old to be
reasonably calculated to lead to admissible evidence.
Finally, Hunte and EAH argue that discovery of the 2001
complaint is barred by § 6-5-551, Ala. Code 1975, which
prohibits discovery of prior acts or omissions in a claim
brought under the AMLA.
With regard to the claim of privilege, § 34-24-60
provides:
5
1160164
"(a) All reports of investigations; documents
subpoenaed by the [Alabama
Board of Medical
Examiners], reports of any investigative committee
appointed by the board; memoranda of the board's
counsel relating to investigations; statements of
persons interviewed by the board or any committee of
the board; all information, interviews, reports,
statements, or memoranda of any kind furnished to
the board or any committee of the board; and any
findings, conclusions, or recommendations resulting
from proceedings of the board or any committee of
the board, unless presented as evidence at a public
hearing, shall be privileged and confidential, shall
be used only in the exercise of the proper functions
of the board, and shall not be public records nor be
available for court subpoena or for discovery
proceedings.
"Nothing
contained
herein
shall
apply
to
records
made in the regular course of business of an
individual; documents or records otherwise available
from original sources are not to be construed as
immune
from
discovery
or
use
in
any
civil
proceedings merely because they were presented or
considered during the proceedings of the Board of
Medical
Examiners
or
the
Medical
Licensure
Commission."
(Emphasis added.)
It is evident from the materials before us that the 2001
complaint submitted to the Board by Hunte's former patient and
provided to Hunte as a part of the proceedings before the
Board is the type of document declared privileged and
confidential under § 34-24-60. Generally, privileged matters
are not subject to discovery. See Rule 26(b)(1), Ala. R. Civ.
6
1160164
P. ("Parties may obtain discovery regarding any matter, not
privileged, which is relevant to the subject matter involved
in the pending action ...."). We further note that Johnson
has not filed an answer to this petition and has not presented
any facts or argument to this Court indicating that the 2001
complaint is not privileged or that it is otherwise subject to
discovery. Thus, we conclude that Hunte and EAH have shown a
clear right to an order protecting the 2001 complaint in Hunte
and EAH's possession from discovery.2 Given our conclusion
that the document is privileged under § 34-24-60, we pretermit
discussion on the other grounds raised by Hunte and EAH.
IV. Conclusion
We conclude that the 2001 complaint is not discoverable
from Hunte and EAH. To the extent the trial court's order
requires Hunte and EAH to produce the 2001 complaint, the
trial court is directed to vacate that order.
PETITION GRANTED; WRIT ISSUED.
Stuart, C.J., and Bolin, Parker, Murdock, Shaw, Wise,
Bryan, and Sellers, JJ., concur.
2We do not address whether the complaint would be
discoverable from the patient who filed it, the original
source.
7 | September 1, 2017 |
cb08e94c-055b-4190-bdd3-2d4c428853ac | Harrison v. PCI Gaming Authority | N/A | 1130168 | Alabama | Alabama Supreme Court | REL: 09/29/2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
SPECIAL TERM, 2017
____________________
1130168
____________________
Amada Harrison, as Administrator of the Estate
of Benjamin C. Harrison, deceased
v.
PCI Gaming Authority
d/b/a Creek Entertainment Center, et al.
Appeal from Escambia Circuit Court
(CV-13-900081)
PER CURIAM.
The Court today decides three appeals involving similar
issues
of
Indian
tribal
immunity
and
subject-matter
jurisdiction in relation to claims of wrongful conduct by the
1130168
Poarch Band of Creek Indians ("the Tribe") and business
entities wholly owned by the Tribe. See Rape v. Poarch Band
of Creek Indians, [Ms. 1111250, September 29, 2017] ___ So. 3d
___ (Ala. 2017), and Wilkes v. PCI Gaming Authority,
[Ms. 1151312, September 29, 2017] ___ So. 3d ___ (Ala. 2017).
In the present case, Amada Harrison appeals the Escambia
Circuit Court's dismissal, based on the doctrine of tribal
immunity, of her complaint alleging that PCI Gaming Authority
d/b/a Creek Entertainment Center; Wind Creek Casino and Hotel
("Wind Creek"); Creek Indian Enterprises, LLC; and the Tribe
(hereinafter
referred
to
collectively
as "the
tribal
defendants") were responsible for the death of her son
Benjamin.
Benjamin was injured during the early morning hours of
March 1, 2013, when, as a passenger, he was involved in an
automobile accident following a high-speed police chase on a
portion of a county roadway that traverses land held by the
Tribe in Escambia County.1 The driver of the vehicle in which
Benjamin was a passenger, Roil Hadley, had consumed alcohol
1The record indicates that the accident occurred on "Jack
Springs Rd.," which is County Road 1.
2
1130168
while he was a patron at Wind Creek during the evening of
February 28, 2013, and the early morning hours of March 1,
2013.
On May 16, 2013, Harrison, as mother and next friend of
Benjamin, sued the tribal defendants and two individuals, Lee
Fountain
and
Kaweta
Coon
(hereinafter referred
to
collectively
as "the defendants").2 The complaint alleged that the tribal
defendants were responsible for negligently or wantonly
serving alcohol to Hadley despite his being visibly
intoxicated and asserted, among other claims, claims against
the tribal defendants under Alabama's Dram Shop Act, § 6-5-71,
Ala. Code 1975.
On June 21, 2013, the defendants filed a motion to
dismiss the complaint. In their motion, the defendants argued
that they were protected from liability by the doctrine of
tribal sovereign immunity, that the circuit court lacked
subject-matter
jurisdiction
because
the
Tribe's
court
possessed exclusive jurisdiction over Harrison's claims, and
that Harrison's claims against Fountain and Coon were due to
2Harrison's complaint alleges that Fountain and Coon are
Poarch Creek Indian police officers employed by the Poarch
Band of Creek Indians.
3
1130168
be dismissed for failing to state a cause of action against
them. On October 7, 2013, the circuit court granted the
motion to dismiss as to the tribal defendants "based on the
sovereign immunity of these defendants"; it denied the motion
as to Fountain and Coon. On October 16, 2013, the circuit
court certified its judgment of dismissal as final pursuant to
Rule 54(b), Ala. R. Civ. P., and stayed the case as to
Fountain and Coon. Harrison appealed.
While this appeal was pending, Benjamin died as a result
of the injuries he sustained in the accident. Subsequently,
Harrison filed a suggestion of death and a motion to
substitute Harrison, as the administrator of Benjamin's
estate, as the proper party in this action.
Standard of Review
"In Newman v. Savas, 878 So. 2d 1147 (Ala.
2003), this Court set forth the standard of review
of a ruling on a motion to dismiss for lack of
subject-matter jurisdiction:
"'A ruling on a motion to dismiss is
reviewed
without
a
presumption
of
correctness. Nance v. Matthews, 622 So. 2d
297, 299 (Ala. 1993). This Court must
accept the allegations of the complaint as
true. Creola Land Dev., Inc. v. Bentbrooke
Housing, L.L.C., 828 So. 2d 285, 288 (Ala.
2002). Furthermore, in reviewing a ruling
on a motion to dismiss we will not consider
4
1130168
whether
the
pleader
will
ultimately
prevail
but whether the pleader may possibly
prevail. Nance, 622 So. 2d at 299.'
"878 So. 2d at 1148–49."
Hall v. Environmental Litig. Grp., P.C., 157 So. 3d 876, 879
(Ala. 2014).
Discussion
The three appeals concerning the Tribe and/or its related
entities that this Court decides today present two
intertwined
issues: (I) the adjudicative jurisdiction, or what is usually
referred to simply as the "subject-matter jurisdiction," of
the tribal and state courts over this dispute and (ii) the
alleged sovereign immunity of the tribal defendants. Both
issues are grounded in the same fundamental principles
regarding the nature of sovereignty and in corollary notions
as to the reach of a sovereign's adjudicative authority and
the extent of its immunity, as discussed in our opinion issued
today in another of the three appeals. See Rape, ___ So. 3d
at ___ (Part III.B.). Unlike the trial court in Rape, the
circuit court in this case issued an opinion stating a reason
for its decision to dismiss the plaintiff's complaint:
sovereign immunity. We therefore turn first to that issue.
5
1130168
Meaningful United States Supreme Court jurisprudence
regarding tribal "sovereign immunity" dates back only 20 to
30 years, specifically to the 1991 case of Oklahoma Tax
Commission v. Citizen Band Potawatomi Indian Tribe of
Oklahoma, 498 U.S. 505 (1991), and to the 1998 case of Kiowa
Tribe of Oklahoma v. Manufacturing Technologies, Inc., 523
U.S. 751 (1998).
Three earlier cases are sometimes referenced as seminal,
the earliest of these being Cherokee Nation v. Georgia, 30
U.S. (5 Pet.) 1 (1831), but the Court's opinion, written by
Chief Justice Marshall, did not address the issue of immunity.
To the contrary, the case held that the Indian tribes were not
the equivalent of foreign nations (and therefore could not sue
in
federal
court
under
the
constitutional
provision
authorizing "foreign states" to access federal courts under
certain circumstances). See Cherokee Nation, 30 U.S. (5 Pet.)
at 18-19.
Turner v. United States, 248 U.S. 354 (1919), is more
commonly referred to as the seminal case recognizing tribal
sovereign immunity. But the case simply did not do this.
Instead, it made clear that the tribe avoided liability in
6
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that case because it actually had been dissolved, Turner, 248
U.S. at 358, and because the law recognized no cause of action
against the tribe for failing to prevent some tribal members
from vandalizing the property of other tribal members. The
only mention of "immunity" was to explain what was not the
reason for its decision.
The last of the three earlier cases sometimes mistakenly
referenced as providing the foundation for tribal immunity is
the 1940 case of United States v. United States Fidelity &
Guaranty Co., 309 U.S. 506 (1940) ("U.S.F.&G."). U.S.F.&G.,
however, provides no substantive discussion of the issue.
Sovereign immunity is merely assumed, with no reference to any
Supreme Court precedent other than bare citations to Cherokee
and Turner. See 309 U.S. at 512-13 and notes 10 and 11. The
case involved a contract claim by a mining company on a
contract it had negotiated with a representative of the
tribes.3
3Between the Court's decision in U.S.F.&G. and its 1991
opinion in
Oklahoma Tax Commission, two decisions stating that
tribes are entitled to "sovereign immunity" were decided by
the Supreme Court. But again, the Court offered no
substantive discussion in support of the doctrine in either
case but, instead, simply presumed it as a fact. Thus, in
Puyallup Tribe, Inc. v. Department of Game of Washington, 433
7
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In Oklahoma Tax Commission, the Supreme Court did suggest
that the doctrine of
tribal sovereign immunity was "originally
enunciated" in Turner, before noting that it has been
reiterated in other cases. 498 U.S. at 510. Again, however,
the Court's opinion offers no substantive rationale for the
doctrine or its genesis. For the first time, however, the
Court in Oklahoma Tax Commission did offer a rationale for
persisting in the doctrine. The Court explained that it was
unwilling to alter or abandon the doctrine because, in the
years since the Court had previously referenced it, Congress
had not acted to alter or eliminate it. Still, the Court
acknowledged that
"Oklahoma ... urges this Court to construe more
narrowly, or abandon entirely, the doctrine of
tribal sovereign immunity. ... At the very least,
Oklahoma proposes that the Court modify [U.S.F.&G.],
because tribal business activities such as cigarette
sales are now so detached from traditional tribal
interests that the tribal-sovereignty doctrine no
longer makes sense in this context. The sovereignty
doctrine, it maintains, should be limited to the
tribal courts and the internal affairs of tribal
government, because no purpose is served by
U.S. 1659 (1977), the Court cited U.S.F.&G., but did not
discuss the matter. And in Santa Clara Pueblo v. Martinez,
436 U.S. 49 (1978), the Court similarly cited Turner,
U.S.F.&G., and Puyallup in stating that the doctrine had
previously been recognized.
8
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insulating
tribal
business
ventures
from
the
authority of the States to administer their laws."
498 U.S. at 510 (emphasis added). The Court declined
Oklahoma's
invitation,
again
based
solely
on
the
"Congressional-inaction" rationale.4
This brings us to 1998 and the Court's decision in Kiowa
Tribe of Oklahoma. In the same mode as previous decisions,
Kiowa upheld the doctrine of tribal immunity, focusing on the
inaction of Congress. In so doing, however, the Court's
opinion was unique in its own self-criticism and self-doubt,
both as to the propriety of the result being achieved and how
its jurisprudence had come to that point.
The majority opinion in Kiowa starts with a confession as
to the weakness of the precedents upon which it relied, noting
that those precedents "rest on early cases that assumed
immunity without extensive reasoning." 523 U.S. at 753. The
majority in Kiowa candidly conceded that the doctrine of
4In
a
special
concurrence,
Justice
Stevens
pointedly
wrote
that "[t]he doctrine of sovereign immunity is founded upon an
anachronistic fiction." 498 U.S. at 514 (Stevens, J.,
dissenting) (citing Nevada v. Hall, 440 U.S. 410, 414–16
(1979)).
9
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tribal immunity "developed almost by accident," 523 U.S. at
756 (emphasis added). As the Court explained:
"The doctrine is said by some of our own opinions to
rest on the Court's opinion in Turner v. United
States, 248 U.S. 354 (1919). See, e.g., [Oklahoma
Tax Comm'n v. Citizen Band] Potawatomi [Indian Tribe
of Oklahoma, 498 U.S. 505] at 510 [(1991)]. Though
Turner is indeed cited as authority for the
immunity, examination shows it simply does not stand
for that proposition. ... The Court stated: 'The
fundamental obstacle to recovery is not the immunity
of a sovereign to suit, but the lack of a
substantive right to recover the damages resulting
from failure of a government or its officers to keep
the peace.' Id., at 358. 'No such liability
existed by the general law.' Id., at 357.
"The quoted language is the heart of Turner. It
is, at best, an assumption of immunity for the sake
of argument, not a reasoned statement of doctrine.
One cannot even say the Court or Congress assumed
the congressional enactment was needed to overcome
tribal immunity. There was a very different reason
why Congress had to pass the Act [of 1908,
authorizing claims against the Creek Nation]: 'The
tribal government had been dissolved. Without
authorization from Congress, the Nation could not
then have been sued in any court; at least without
its consent.' Id., at 358. The fact of tribal
dissolution, not its sovereign status, was the
predicate for the legislation authorizing suit.
Turner, then, is but a slender reed for supporting
the principle of tribal sovereign immunity."
523 U.S. at 756-57 (emphasis added).
Despite the fundamental deficiencies in precedent and
rationale recognized by the Court itself, the majority in
10
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Kiowa nonetheless chose to adhere to the doctrine, expressly
"declin[ing] to revisit our case law and choos[ing] to defer
to Congress," which the Court noted had chosen not to act in
this area. 523 U.S. at 760. Further still, it overlooked the
fact that, because the doctrine itself is of judicial
creation, Bay Mills, ___ U.S. at ___, 134 S. Ct. at 2045
(Scalia, J., dissenting), it is in a category where the
dubious notion of "legislation by silence" has its weakest
rationale. See, e.g., United States v. Wells, 519 U.S. 482,
496 (1997) (observing that the Supreme Court has "'frequently
cautioned that "[i]t is at best treacherous to find in
congressional silence alone the adoption of a controlling rule
of law"'" (quoting NLRB v. Plasterers' Local Union No. 79, 404
U.S. 116, 129-30 (1971), quoting in turn Girouard v. United
States, 328 U.S. 61, 69 (1946))); Star Athletica, L.L.C. v.
Varsity Brands, Inc., ___ U.S. ___, ___, 137 S.Ct. 1002, 1015
(2017)
(noting
that
"'[c]ongressional
inaction
lacks
persuasive significance' in most circumstances" (quoting
Pension Benefit Guar. Corp. v. LTV Corp., 496 U.S. 633, 650
(1990))).
11
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Finally, the Kiowa Court expressed concerns as to the
propriety and fairness of perpetuating the doctrine of tribal
sovereign immunity in modern times, and on that basis even
went so far as to suggest, as we note today in Wilkes, ___
So. 3d at ___, that there might be "a need to abrogate" it:
"The doctrine of tribal immunity came under
attack a few years ago in [Oklahoma Tax Commission
v. Citizen Band] Potawatomi [Indian Tribe of
Oklahoma, 498 U.S. 505 (1991)]. The petitioner
there asked us to abandon or at least narrow the
doctrine because tribal businesses had become far
removed from tribal self-governance and internal
affairs. We retained the doctrine, however, on the
theory that Congress had failed to abrogate it in
order to promote economic development and tribal
self-sufficiency. Id., at 510. The rationale, it
must be said, can be challenged as inapposite to
modern, wide-ranging tribal enterprises extending
well
beyond
traditional
tribal
customs
and
activities. Justice Stevens, in a separate opinion,
criticized tribal immunity as 'founded upon an
anachronistic fiction' and suggested it might not
extend to off-reservation commercial activity. Id.,
at 514-15 (concurring opinion).
"There are reasons to doubt the wisdom of
perpetuating the doctrine. At one time, the
doctrine of tribal immunity from suit might have
been thought necessary to protect nascent tribal
governments from encroachments by States. In our
interdependent and mobile society, however, tribal
immunity extends beyond what is needed to safeguard
tribal self-governance. This is evident when tribes
take part in the Nation's commerce. Tribal
enterprises now include ski resorts, gambling, and
sales of cigarettes to non-Indians. See Mescalero
Apache Tribe v. Jones, 411 U.S. 145 (1973);
12
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Potawatomi, supra; Seminole Tribe of Fla. v.
Florida, 517 U.S. 44 (1996). In this economic
context, immunity can harm those who are unaware
that they are dealing with a tribe, who do not know
of tribal immunity, or who have no choice in the
matter, as in the case of tort victims.
"These considerations might suggest a need to
abrogate tribal immunity, at least as an overarching
rule. Respondent does not ask us to repudiate the
principle outright, but suggests instead that we
confine it to reservations or to noncommercial
activities. We decline to draw this distinction in
this case, as we defer to the role Congress may wish
to exercise in this important judgment.
"....
"In light of these concerns, we decline to
revisit our case law and choose to defer to
Congress. Tribes enjoy immunity from suits on
contracts,
whether
those
contracts
involve
governmental or commercial activities and whether
they were made on or off a reservation. Congress
has not abrogated this immunity, nor has petitioner
waived it, so the immunity governs this case. ..."
523 U.S. at 757-60 (emphasis added).
As we do in Wilkes, we take particular note of the
Court's comment that tribal sovereign immunity especially
hurts those "who have no choice in the matter." 523 U.S. at
758. We note as well the Court's limitation of its holding in
Kiowa to "suits on contract." 523 U.S. at 760.
13
1130168
In a dissenting opinion in Kiowa, Justice Stevens echoed
the majority's criticisms of its own decision. He offered an
organized and insightful affirmation of the "accidental"
"development"
of
tribal-immunity
law,
including
the
inappositeness of tribal immunity to modern tribes and the
unfairness it creates for tort victims and others who have "no
opportunity to negotiate for a waiver" through "voluntary
contractual relationships." 523 U.S. at 766.5
5Justice
Stevens's
dissent
was
grounded
in
an
appreciation
of the intrinsic nature of sovereignty and sovereign immunity,
see Rape, ___ So. 3d at ___ (Part III.B.), and of how the
doctrine of tribal immunity as recognized by the Court is
disconsonant with that nature, with essential traditions of
the common law, and with the sovereign authority of states in
our American system of federalism. Among other things,
Justice Stevens explained:
"'The doctrine of sovereign immunity is an
amalgam of two quite different concepts, one
applicable to suits in the sovereign's own courts
and the other to suits in the courts of another
sovereign.' Nevada v. Hall, 440 U.S. 410, 414
(1979). In the former category, the sovereign's
power to determine the jurisdiction of its own
courts and to define the substantive legal rights of
its
citizens
adequately
explains
the
lesser
authority to define its own immunity. Kawananakoa
v. Polyblank, 205 U.S. 349, 353 (1907). The
sovereign's claim to immunity in the courts of a
second sovereign, however, normally depends on the
second sovereign's law. Schooner Exchange v.
McFaddon, 7 Cranch 116 (1812). An Indian tribe's
assertion of immunity in a state judicial proceeding
is unique because it implicates the law of three
14
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Justice Stevens concluded his opinion with "compelling
reasons [that] favor the exercise of judicial restraint,"
including this final one:
"[T]he rule is unjust. This is especially so with
respect to tort victims who have no opportunity to
negotiate for a waiver of sovereign immunity; yet
nothing in the Court's reasoning limits the rule to
lawsuits arising out of voluntary contractual
relationships. Governments, like individuals,
should
pay
their
debts
and
should
be
held
accountable for their unlawful, injurious conduct."
523 at 764-66 (emphasis added).
Sixteen years after Kiowa, in his dissent in Michigan v.
Bay Mills Indian Community, ___ U.S. ___, 134 S. Ct. 2024
(2014), Justice Thomas reviewed circumstances and cases he
believed had served in the intervening years to highlight the
unfairness of the Kiowa decision:
"In the 16 years since Kiowa, the commercial
activities of tribes have increased dramatically.
This is especially evident within the tribal
gambling industry. Combined tribal gaming revenues
in
28
States
have
more
than
tripled--from
different sovereigns: the tribe itself, the State,
and the Federal Government."
523 U.S. at 760-61 (Stevens, J., dissenting). Justice Stevens
repeats the majority's concession that "the doctrine of tribal
immunity from judicial jurisdiction 'developed almost by
accident'" and reviews in detail the lack of a rationale for
the doctrine in the two cases to which "[i]ts origin is
attributed" -- Turner and U.S.F.&G. Id. at 761.
15
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$8.5 billion in 1998 to $27.9 billion in 2012.
National Indian Gaming Commission, 2012 Indian
Gaming Revenues Increase 2.7 Percent (July 23,
2013),
online
at
http://www.nigc.gov/
LinkClick.aspx?fileticket=Fhd5shyZ1fM%3D[6]
...
But
tribal businesses extend well beyond gambling and
far past reservation borders. In addition to
ventures that take advantage of on-reservation
resources
(like
tourism,
recreation,
mining,
forestry,
and
agriculture),
tribes
engage
in
'domestic and international business ventures'
including
manufacturing,
retail,
banking,
construction, energy, telecommunications, and more.
Graham, An Interdisciplinary Approach to American
Indian Economic Development, 80 N.D. L. Rev. 597,
600–604 (2004). Tribal enterprises run the gamut:
they sell cigarettes and prescription drugs online;
engage in foreign financing; and operate greeting
cards companies, national banks, cement plants, ski
resorts, and hotels. Ibid.; see also, e.g., The
Harvard
Project
on
American
Indian
Economic
Development, The State of the Native Nations 124
(2008) (Ho–Chunk, Inc., a tribal corporation of the
Winnebago Tribe of Nebraska, operates 'hotels in
Nebraska and Iowa,' 'numerous retail grocery and
convenience
stores,'
a
'tobacco
and
gasoline
distribution company,' and 'a temporary labor
service provider'); Four Fires, San Manuel Band of
Mission
Indians,
http://www.
sanmanuel-
nsn.gov/fourfires.php.html[6]
(four
Tribes
from
California and Wisconsin jointly own and operate a
$43 million hotel in Washington, D.C.). These
manifold commercial enterprises look the same as any
other--except immunity renders the tribes largely
litigation-proof.
"As the commercial activity of tribes has
proliferated, the conflict and inequities brought on
6On the date this opinion was released, these Web sites
could no longer be accessed on the Internet.
16
1130168
by blanket tribal immunity have also increased.
Tribal immunity significantly limits, and often
extinguishes, the States' ability to protect their
citizens and enforce the law against tribal
businesses. This case is but one example: No one
can seriously dispute that Bay Mills' operation of
a casino outside its reservation (and thus within
Michigan territory) would violate both state law and
the Tribe's compact with Michigan. Yet, immunity
poses a substantial impediment to Michigan's efforts
to halt the casino's operation permanently. The
problem repeats itself every time a tribe fails to
pay state taxes, harms a tort victim, breaches a
contract, or otherwise violates state laws, and
tribal immunity bars the only feasible legal remedy.
Given the wide reach of tribal immunity, such
scenarios are commonplace. See, e.g., Oneida Indian
Nation of New York v. Madison Cty., 605 F.3d 149,
163 (C.A.2 2010) (Cabranes, J., joined by Hall, J.,
concurring) ('The holding in this case comes down to
this: an Indian tribe can purchase land (including
land that was never part of a reservation); refuse
to
pay
lawfully-owed
taxes;
and
suffer
no
consequences because the taxing authority cannot sue
to collect the taxes owed'); see also Furry v.
Miccosukee Tribe of Indians of Fla., 685 F.3d 1224
(C.A.11 2012) (Tribe immune from a suit arising out
of a fatal off-reservation car crash that alleged
negligence and violation of state dram shop laws);
Native
American
Distributing
v.
Seneca–Cayuga
Tobacco Co., 546 F.3d 1288 (C.A.10 2008) (tribal
officials and a tobacco-products manufacturer were
immune from a suit brought by a national distributor
alleging breach of contract and interstate market
manipulation); Tonasket v. Sargent, 830 F. Supp.2d
1078 (E.D. Wash. 2011) (tribal immunity foreclosed
an action against the Tribe for illegal price
fixing,
antitrust
violations,
and
unfair
competition), aff'd, 510 Fed. Appx. 648 (C.A.9
2013); Multimedia Games, Inc. v. WLGC Acquisition
Corp., 214 F. Supp.2d 1131 (N.D. Okla. 2001) (tribal
immunity
barred
a
suit
alleging
copyright
17
1130168
infringement,
unfair
competition,
breach
of
contract, and other claims against a tribal business
development agency).
"In the wake of Kiowa, tribal immunity has also
been exploited in new areas that are often heavily
regulated by States. For instance, payday lenders
(companies that lend consumers short-term advances
on paychecks at interest rates that can reach
upwards of 1,000 percent per annum) often arrange to
share fees or profits with tribes so they can use
tribal immunity as a shield for conduct of
questionable legality. Martin & Schwartz, The
Alliance Between Payday Lenders and Tribes: Are
Both Tribal Sovereignty and Consumer Protection at
Risk? 69 Wash. & Lee L. Rev. 751, 758–759, 777
(2012). Indian tribes have also created conflict in
certain States by asserting tribal immunity as a
defense against violations of state campaign finance
laws. See generally Moylan, Sovereign Rules of the
Game: Requiring Campaign Finance Disclosure in the
Face of Tribal Sovereign Immunity, 20 B.U. Pub.
Interest L.J. 1 (2010).
"In sum, any number of Indian tribes across the
country have emerged as substantial and successful
competitors
in
interstate
and
international
commerce, both within and beyond Indian lands. As
long as tribal immunity remains out of sync with
this reality, it will continue to invite problems,
including de facto deregulation of highly regulated
activities;
unfairness
to
tort
victims;
and
increasingly fractious relations with States and
individuals alike."
___ U.S. at ___, 134 S.Ct. at 2050-52 (Thomas, J., dissenting)
(footnote omitted; emphasis added). Cases and scenarios such
as those described above led one of the concurring Justices in
Kiowa to confess that he had seen enough and to opine that the
18
1130168
Court, with his concurrence, had made a "glaringly obvious"
"mess" and that it was up to the Court to clean it up. Bay
Mills, ___ U.S. at ___, 134 S.Ct. at 2045 (Scalia, J.,
dissenting).
Nonetheless, over the strenuous dissents of Justices
Scalia, Thomas, Ginsburg, and Alito, the Supreme Court in Bay
Mills declined to overrule Kiowa on the facts it had before
it. The majority in Bay Mills began with the following
statement: "Indian tribes are '"domestic dependent nations"'
that exercise 'inherent sovereign authority.'" Bay Mills, ___
U.S. at ___, 134 S.Ct. at 2030 (quoting Oklahoma Tax
Commission, 498 U.S. at 509, quoting in turn Cherokee Nation,
supra). From there, the majority yet again deferred to
congressional inaction as a rationale for perpetuating the
jurisprudence of tribal immunity. As against this rationale,
however, the Court did note that it had never employed the
doctrine against one who had no alternative to judicial
relief, see ___ U.S. at ___ n.8, 134 S. Ct. at 2036 n.8,
19
1130168
indicating that it understood the potential unfairness of that
circumstance. Bay Mills did not involve such a plaintiff. 7
In concert with its reliance on congressional inaction,
the main opinion in Bay Mills relied heavily on the doctrine
of stare decisis. In so doing, however, it described Kiowa as
a decision in which the Court had declined "to make any
exception for suits arising from a tribe's commercial
activities." ___ U.S. at ___, 134 S. Ct. at 2031. Further,
in an effort to validate it reliance on stare decisis, it
advanced for the first time these notions: that prior
decisions like Kiowa could be taken into account by those
"negotiating
their
contracts
and
structuring
their
transactions" with tribes and that, "[a]s in other cases
involving contract and property rights, concerns of stare
decisis are thus 'at their acme.'" ___ U.S. at ___, 134 S.Ct.
7The Court also took note of a few statutes over the years
in which Congress had referenced the immunity doctrine, see
Bay Mills, ___ U.S. at ___ n.11, 134 S. Ct. at 2039 n.11
(listing some statutes and citing Potawatomi, 498 U.S. at 510,
for others), but none, as Justice Thomas countered, in which
Congress had itself affirmatively legislated the existence of
the doctrine, ___ U.S. at ___, 134 S. Ct. at 2052 (Thomas, J.,
dissenting) ("To this day, Congress has never granted tribal
sovereign immunity in any shape or form ....").
20
1130168
at 2036 (emphasis added). See also Wilkes, ___ So. 3d at ___
(to same effect).
In the same vein, the Court in Bay Mills opined that
congressional inaction had confirmed an intent "to retain
tribal immunity (at least for now) in a case like this one,"
___ U.S. at ___, 134 S. Ct. at 2039 (emphasis added), which
apparently is a reference to a case brought by a state or
other party with the ability to negotiate a waiver or
otherwise protect its interests in some of the other ways,
which the Court described as available to Michigan.
Finally, the Court also offered that none of its off-
reservation, tribal-immunity cases had ever involved "a tort
victim" or other plaintiff "who has no alternative way to
obtain relief" and that such a case might provide a reason for
a different outcome:
"Adhering to stare decisis is particularly
appropriate here given that the State, as we have
shown, has many alternative remedies: It has no
need to sue the Tribe to right the wrong it alleges.
See supra, at 2034–2035. We need not consider
whether the situation would be different if no
alternative remedies were available."
___ U.S. at ___ n.8, 134 S. Ct. at 2036 n.8 (emphasis added).
21
1130168
As indicated, Justice Thomas's impassioned dissent
expounded upon the themes that the Court's expansion of tribal
immunity in Kiowa, reiterated in Bay Mills, was "unsupported
by any rationale for that doctrine, inconsistent with the
limits on tribal sovereignty, and an affront to state
sovereignty." ___ U.S. at ___, 134 S. Ct. at 2045 (Thomas, J.,
dissenting). Justice Thomas observed:
"[Kiowa], wrong to
begin with, has
only
worsened
with the passage of time. In the 16 years since
Kiowa, tribal commerce has proliferated and the
inequities engendered by unwarranted tribal immunity
have multiplied. Nevertheless, the Court turns down
a chance to rectify its error. Still lacking a
substantive justification for Kiowa's rule, the
majority relies on notions of deference to Congress
and stare decisis. Because those considerations do
not
support
(and
cannot
sustain)
Kiowa's
unjustifiable rule and its mounting consequences, I
respectfully dissent."
___ U.S. at ___, 134 S.Ct. at 2045-46 (Thomas, J.,
dissenting).
Justice Thomas's dissent was grounded in the intrinsic
attributes of sovereignty and sovereign immunity described in
our decision today in Rape, ___ So. 3d at ___ (Part III.B.),
as well as many of the concerns expressed by commentators and
courts in the wake of Kiowa. See, e.g., Bay Mills, ___ U.S.
at ___, 134 S.Ct. at 2045-55 (Thomas, J., dissenting).
22
1130168
Reflecting the concerns expressed above, and in the
interest of justice, this Court today in the case of Wilkes,
supra, declines to extend the doctrine of tribal immunity to
actions in tort, in which the plaintiff has no opportunity to
bargain for a waiver and no other avenue for relief. Based on
the foregoing and on our holding in Wilkes, we similarly
conclude that the judgment entered by the trial court in the
present case -- extending to the tribal defendants' immunity
from responsibility for the life-ending injuries to Benjamin
allegedly caused by their negligent or wanton serving of
alcohol to a visibly intoxicated patron -- is due to be
reversed. We remand this case to the circuit court to take up
the related issue, which was not addressed by the circuit
court, of the asserted lack of adjudicative, or "direct"
subject-matter, jurisdiction by the circuit court. In so
doing, we note that the tribal defendants take the position
that the claim in this case arose on Indian land. According
to the complaint, however, Benjamin's life-ending injuries
occurred on Jack Springs Rd., which is Escambia County Road 1,
a fact that may bear on the whether adjudicative authority
23
1130168
over this case lies in tribal or state courts. Compare Strate
v. A-1 Contractors, 520 U.S. 438 (1997).
In addition, on remand, the circuit court should consider
whether subject-matter jurisdiction is affected by the fact
that the alleged tortious conduct of the tribal defendants
entails a violation of Alabama's statutory and regulatory
scheme for the sale of alcohol in Alabama,8 a scheme to which
Congress has expressly declared the Tribe to be subject. See
18 U.S.C. § 1611. See generally Ala. Code 1975, Title 28
(including § 28-10-5 (requiring the Alabama's Alcoholic
8Following the filing of the parties' initial briefs in
this case, this Court in a separate case rejected a challenge
to a decision of the Montgomery Circuit Court declining to
apply the doctrine of tribal sovereign immunity to the Tribe
or to PCI Gaming Authority in a dram-shop action. See
Ex parte Poarch Band of Creek Indians, 155 So. 3d 224 (Ala.
2014) (no opinion, but with special writing). In her reply
brief, Harrison makes note of this decision, including Chief
Justice Moore's special concurrence, 155 So. 3d at 225,
examines the State statutory and regulatory scheme governing
the sale of alcohol within the State of Alabama, and asks this
Court to remand the case to the circuit court to reconsider
the jurisdictional issue
of
tribal sovereign immunity in light
of the same. The need for a such a remand as to the issue of
immunity per se is pretermitted by our decision today in
Wilkes, but in light of the concerns raised by Harrison and
given the intertwined, jurisdictional nature of both issues,
the circuit court on remand should consider Alabama's
statutory and regulatory scheme for the licensing of
alcoholic-beverage sales as it relates to the issue of tribal
adjudicatory authority.
24
1130168
Beverage Control Board ("the ABC Board") to receive proof
annually of, and to certify annually, the compliance by
licensees with "the requirements of this chapter," including
so-called "dram shop" regulations) and § 28-3A-24 (providing
for hearings and adjudications by the ABC Board of violations
of Alabama's statutory and regulatory licensing scheme,
subject to review in state courts)); Ala. Admin. Code (ABC
Board),
including
Regs.
20-X-2-.03,
20-X-5-.14
and
20-X-6-.02(4) (making unlawful "on-premises" sales to visibly
intoxicated patrons); Ala. Code 1975, § 6-5-71 (providing for
private civil-enforcement actions for damages based the sale
of liquors or alcoholic beverages "contrary to the provisions
of law"). Compare Rice v. Rehner, 463 U.S. 713, 724 (1983)
(holding that 18 U.S.C. § 1161 is an express congressional
enactment that "divested the Indians" of power to regulate in
the arena of alcohol sales and that, as to such regulation,
Indians do not "possess the ususal accoutrements of tribal
self-government"); see also Bittle v. Bahe, 192 P.3d 810, 823
(Okla. 2008) (upholding state court jurisdiction over a dram-
shop action brought as part of the "extant jurisprudence"
under Oklahoma's "comprehensive statutory scheme" regarding
25
1130168
the sale of alcohol and, "[c]onsistent with Rice v. Rehner,
... reject[ing] the Tribe's argument that [18 U.S.C.] § 1161
does not authorize the state courts to exercise jurisdiction
over the Tribe"), and Cossey v. Cherokee Nation Enters., LLC,
212 P.3d 447, 456 (Okla. 2009) (holding that a tribal court is
not a court of general jurisdiction and that "[i]ts
jurisdiction
could
be
asserted
in
matters
involving
non-Indians only when their activities on Indian lands are
activities that may be regulated by the Tribe"), both cases
overruled by Sheffer v. Buffalo Run Casino, PTE, Inc., 315
P.3d 359 (Okla. 2013). See also our opinion released today in
Rape, ___ So. 3d at ___ (discussing, inter alia, Nevada v.
Hicks, 533 U.S. 353 (2001), and the fact that the exercise of
tribal powers, even as to matters of "tribal self-government"
and "internal relations," is subject to express congressional
enactments, as well as the natural correlation between
adjudicative authority and regulatory authority).
Conclusion
For the foregoing reasons, the circuit court's judgment
of dismissal is reversed and this cause is remanded for
further proceedings consistent with this opinion.
26
1130168
REVERSED AND REMANDED.
Bolin, Parker, Murdock, Wise, Bryan, and Sellers, JJ.,
concur.
Stuart, C.J., and Main, J., concur in the result.
Shaw, J., recuses himself.
27 | September 29, 2017 |
d5bc70f3-e14d-4c62-af42-b5c666039e07 | Morrow v. Bentley | N/A | 1151313 | Alabama | Alabama Supreme Court | Rel: November 3, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
____________________
1151313
____________________
Johnny Mack Morrow and Jim Zeigler
v.
Robert Bentley et al.
Appeal from Montgomery Circuit Court
(CV-16-900989)
PER CURIAM.
Johnny Mack Morrow, a member of the Alabama House of
Representatives, and Jim Zeigler, auditor for the State of
Alabama (hereinafter collectively referred to as "the
plaintiffs"), appeal from a judgment of
the Montgomery Circuit
1151313
Court ("the trial court") dismissing their complaint filed
against Robert Bentley, individually and in his official
capacity as governor of the State of Alabama; Gunter Guy,
individually and in his official capacity as commissioner of
the Alabama Department of Conservation and Natural Resources;
Luther Strange, individually and in his official capacity as
attorney general for the State of Alabama; William Newton,
individually and in his official capacity as director of the
Alabama
Department
of
Finance;
and
Cooper
Shattuck,
individually and in his official capacity as executive
director of the University of Alabama System's Gulf State Park
Project (hereinafter collectively referred to as "the
defendants").1
Facts and Procedural History
On July 25, 2016, Morrow, individually and in his
official capacity as a State representative, and Zeigler,
individually and in his official capacity as State Auditor,
1It appears that the defendants no longer hold the offices
they held when they were sued in their official capacities.
Pursuant to Rule 43(b), Ala. R. App. P., the State officials
holding
the
offices
vacated
by
the
defendants
are
automatically substituted on appeal, in their official
capacities, for the defendants, to the extent the defendants
were sued in their official capacities.
2
1151313
sued the defendants. Relevant to the plaintiffs' claims is
the Gulf State Park Projects Act, codified at § 9-14E-1 et
seq., Ala. Code 1975 ("the Act"), which was enacted to
facilitate the construction of a hotel/conference center in
Gulf State Park ("the project"). See § 9-14E-1(9), Ala. Code
1975. Regarding funding for the project, the Act provides:
"Other than project revenues, only National
Resource Damage Assessment funds or Restore Act
funds may be expended to implement this chapter. If
the State of Alabama does not receive or has not
been awarded any National Resource Damage Assessment
funds or Restore Act funds for the purposes of this
chapter by December 31, 2015, this chapter is
repealed on January 1, 2016."
§ 9-14E-9, Ala. Code 1975.
It appears that Alabama received National Resource Damage
Assessment funds before December 31, 2015. However, the
United States District Court for the Southern District of
Alabama ("the district court") entered an order in February
2016 enjoining the use of those funds on the project until the
defendants in the
district court complied with certain federal
requirements.2 The plaintiffs' complaint alleged that, given
the district court's order, the defendants were "[w]ithout any
2The defendants in the district court case were Federal
and State officials who had been designated to conduct a
"Natural Resource Damage Assessment."
3
1151313
lawful funds to spend upon the [p]roject." Nevertheless, the
plaintiffs alleged, the defendants "boldly, unlawfully and
hastily proceeded" to fund the project with moneys received
from British Petroleum Exploration & Production, Inc. ("BP"),
as a result of the 2010 Deepwater Horizon oil spill in the
Gulf of Mexico. According to the complaint, those funds are
"neither National Resource Damage Assessment funds, nor
Restore Act funds, nor Project revenues," and, thus, the
complaint alleged, "State funds ... are now being expended and
disbursed by [the defendants] daily in a manner that is
unconstitutional and unlawful because none are derived from
any source of funds allowed by Alabama law to be so expended
or disbursed" on the project. The complaint further alleged
that the defendants' funding of the project with moneys not
authorized by the Act constituted a usurpation of the
appropriation power of the legislature.
Given those allegations, the plaintiffs' complaint
asserted three declaratory-judgment counts. Count I sought a
judgment declaring that the defendants "have unlawfully
disbursed and expended ... state funds"; "restrain[ing]
further
unconstitutional
and
illegal
expenditures
and
4
1151313
disbursements of state funds"; and requiring the defendants
"to
account
...
for
any
and
all
sums
they
have
unconstitutionally and/or illegally disbursed or expended."
Count II sought a judgment declaring that the Act has been
repealed by virtue of § 9-14E-9 and, thus, that the project
"cannot lawfully continue." Count III sought a judgment
declaring that the defendants "have unlawfully 'appropriated'
funds in violation of Constitution of Alabama of 1901";
enjoining the defendants "from continuing to violate ...
constitutional and statutory provisions"; "requiring an
accounting ... of all ... unconstitutional and unlawful
disbursements and expenditures"; and "requiring restoration
... of ... all state funds ... unconstitutionally and
unlawfully expended."
The defendants filed a motion to dismiss in which they
asserted, among other defenses, that the plaintiffs lacked
standing to prosecute their action in either their individual
or official capacities.3 In their brief in support of the
3Strange did not join the other defendants' motion to
dismiss but, instead, filed his own motion to dismiss in which
he also asserted lack of standing as a ground for dismissal.
Because both motions asserted lack of standing as a ground for
dismissal, we have, for simplicity, treated the separate
motions as a single motion to dismiss.
5
1151313
motion, the defendants alleged that the plaintiffs' complaint
was the "second assault made ... upon the [project]" in the
trial court. In support of that allegation, the defendants
attached to their motion a copy of a complaint filed against
the defendants in April 2016 by Charles Grimsley, in his
individual capacity as a taxpayer, in which Grimsley made
essentially the same allegations and sought essentially the
same relief the plaintiffs seek in this case.4 The defendants
also attached a copy of a motion to dismiss they had filed in
Grimsley's case in which they argued that Grimsley lacked
standing to prosecute his action in his capacity as a taxpayer
because he failed to allege that funding the project with
moneys received from BP would cause him to "suffer the
liability of
replenishing the
state
treasury
through
increased
taxes." On July 22, 2016, the trial court, Judge Truman M.
Hobbs,
dismissed
Grimsley's complaint without
stating
a
reason
for the dismissal.
In their motion to dismiss the plaintiffs' complaint in
this case, the defendants argued that the only distinction
between Grimsley's complaint and the plaintiffs' complaint is
4Grimsley was represented by the same attorneys who
represented the plaintiffs in this case.
6
1151313
that Grimsley brought his complaint in his
individual capacity
as a taxpayer and the plaintiffs brought their action in both
their individual and their official capacities. As to the
plaintiffs' standing in their individual capacities, the
defendants argued that the plaintiffs, like Grimsley, had
failed to allege that funding the project with moneys received
from BP would result in a probable increase in their tax
burden and, thus, that they lacked standing to prosecute their
action in their capacities as taxpayers. As to the
plaintiffs' standing in their official capacities, the
defendants argued that the plaintiffs' "representative
capacity has [no] legal effect" on a determination of standing
and "confers [no] special right upon [them]" to prosecute
their action. The defendants further argued that the moneys
funding the project are the "legal equivalent of federal funds
or private grant funds," and, their argument continued, "[i]t
is axiomatic that the Alabama Legislature cannot appropriate
these funds or control or interfere with the manner in which
they are spent."
The plaintiffs filed a reply to the motion to dismiss,
but they failed to respond to the defendants' argument that
7
1151313
they lacked standing in their individual capacities as
taxpayers. Instead, the plaintiffs argued that, "[u]nlike
ordinary tax paying citizens, [the plaintiffs] are elected
state officials whose standing does not require a showing that
the funds being used ... are tax dollars." In response to the
defendants' argument that the moneys funding the project were
the equivalent of federal or private-grant funds, the
plaintiffs argued that the moneys were nevertheless "state
funds subject to appropriation by the state Legislature."
Thus, the plaintiffs argued, Zeigler, as State Auditor, was
tasked with auditing the State's finances, and Morrow, as a
member of the legislature, had standing to prosecute an action
to ensure that the defendants "follow the law and not usurp
constitutional and statutory powers afforded" the plaintiffs.
The trial court, Judge Gregory O. Griffin, Sr., held a
hearing on the defendants' motion to dismiss and subsequently
entered a judgment on September 15, 2016, dismissing the
complaint on the ground that the plaintiffs lacked standing to
prosecute the action. The plaintiffs, arguing that they have
standing in both their individual capacities as taxpayers and
in their official capacities, timely appealed. We affirm.
8
1151313
Discussion
I. The Plaintiffs' Standing as Taxpayers
Initially, we note that "'[t]he issue of standing
presents a pure question of law, and the trial court's ruling
on that issue is entitled to no deference on appeal.'" Town
of Mountainboro v. Griffin, 26 So. 3d 407, 409 (Ala. 2009)
(quoting Blue Cross & Blue Shield of Alabama v. Hodurski, 899
So. 2d 949, 953 (Ala. 2004)). The plaintiffs first argue that
they have standing to prosecute their action in their
individual capacities as taxpayers. However, the plaintiffs
waived that argument by not presenting it to the trial court.
See Allsopp v. Bolding, 86 So. 3d 952, 962 (Ala. 2011) ("It is
well settled that an appellate court may not hold a trial
court in error in regard to theories or issues not presented
to that court.").
At the hearing on the defendants' motion to dismiss, the
defendants argued (as they did in their motion) that the
plaintiffs lacked standing to prosecute their action in their
individual capacities as taxpayers. However, just as the
plaintiffs did not respond to that argument in their reply to
the motion to dismiss, the plaintiffs' attorney did not
9
1151313
respond to that argument at the hearing. Instead, the
plaintiffs' attorney argued only that the plaintiffs had
standing in their official capacities and, in fact, expressly
indicated to the trial court at the beginning of the hearing
that the plaintiffs were not asserting the same standing
ground Grimsley had asserted, i.e., taxpayer standing:
"[Plaintiffs' attorney]: Your Honor, the first
thing that I think I need to reply to is what [the
defendants' attorney] said about this being the same
case that's been in front of Judge Hobbs. We could
not disagree more.
"Charles Grimsley filed an action that was
assigned to Judge Hobbs as a taxpayer. ... He was
saying [that] as a taxpayer of Alabama he [had]
standing. And Judge Hobbs simply said that a
taxpayer did not have standing.
"... And now [the plaintiffs] are ... in a
separate case alleging totally separate bases for
standing from what Grimsley had ...."
(Emphasis added.)
At the close of the hearing, the plaintiffs' attorney
reiterated that the plaintiffs were not asserting the same
standing ground Grimsley had asserted but, instead, were
asserting that they had standing solely in their official
capacities:
"[Plaintiffs'
attorney]:
[The
defendants'
attorney] likes to come back to this taxpayer
10
1151313
revenue, taxpayer standing issue because he was
successful with that in front of Judge Hobbs. This
is not the same case. These are not the same claims.
The plaintiffs in this case are uniquely situated as
elected officials to challenge the use of public
moneys, Alabama's money, by these defendants without
legislative appropriation."
(Emphasis added.)
It is true that the plaintiffs filed their action both in
their individual capacities as taxpayers and in
their official
capacities and, thus, in one sense, "presented" the
"taxpayer-
standing" theory to the trial court. Allsopp, supra.
However, it is evident that the plaintiffs not only failed to
assert that theory in their response to the motion to dismiss
and at the hearing on that motion but also expressly abandoned
that theory at the hearing. It is also evident that the trial
court was under the impression that the plaintiffs were
asserting their standing only in their official capacities,
regardless of the substance of their complaint. The trial
court's judgment states, in pertinent part:
"[The plaintiffs], in both their individual and
official capacities, assert their claims against the
Defendants.
However,
their
arguments
and
authorities submitted in opposition to the Motion to
Dismiss address only the contention that ... Morrow
in his capacity as a member of the Alabama House of
Representatives and ... Zeigler in his capacity as
the Auditor of the State of Alabama, have standing
11
1151313
to assert the claims set out in the Complaint by
virtue of those 'official capacities.'
"....
"As
noted, the
Plaintiffs base their claims that
they have standing to bring this action solely as a
product of their official capacities."
(Emphasis added.)
Nevertheless, the plaintiffs now seek to hold the trial
court in error for refusing to find that the plaintiffs had
standing in their individual capacities as taxpayers.
However, for this Court to hold the trial court in error on
that issue would be, given the above, to hold it in error with
respect to an issue not presented to it. Allsopp, supra.
We recognize, of course, that the issue of lack of
standing may not be waived. RLI Ins. Co. v. MLK Ave.
Redevelopment Corp., 925 So. 2d 914, 918 (Ala. 2005). This is
so because "[t]he question of standing implicates the
subject-matter jurisdiction of the court." Bernals, Inc. v.
Kessler-Greystone, LLC, 70 So. 3d 315, 319 (Ala. 2011). Thus,
if a judgment is entered in favor of a plaintiff and the
defendant either challenges the plaintiff's standing for the
first time on appeal or fails to raise the issue altogether,
this Court will not hold that the issue of the plaintiff's
12
1151313
standing was waived. Ex parte Simpson, 36 So. 3d 15, 25 (Ala.
2009) (noting that "this Court is duty-bound to notice and
address the absence of standing and hence subject-matter
jurisdiction ex mero motu" (emphasis added)). Rather, this
Court must address the alleged lack of standing because the
refusal to consider an issue that potentially deprives a trial
court of subject-matter jurisdiction could result in the
affirmance of a void judgment. Bernals, 70 So. 3d at 319
("When a circuit court lacks subject-matter jurisdiction, all
orders and judgments entered in the case, except an order of
dismissal, are void ab initio.").
However, that is not the case here. Because the trial
court's judgment dismissed the complaint on the ground that
the plaintiffs lacked standing, there is no judgment that
might have been improperly entered in the absence of subject-
matter jurisdiction. Bernals, supra. Thus, this Court does
not risk affirming a void judgment by refusing to address the
plaintiffs' taxpayer-standing argument. As a result, this
Court is under no duty, as it would be in a case where a
judgment had been entered in favor of a plaintiff who lacked
standing, to consider the abandoned theory that the
plaintiffs
13
1151313
have taxpayer standing. Compare Ex parte Simpson, supra, with
Blevins v. Hillwood Office Ctr. Owners Ass'n, 51 So. 3d 317,
322-23 (Ala. 2010) (holding, in a case where the plaintiffs
"suggest[ed] no legal theory on which standing might be based"
that it is "not this Court's function to 'embark on its own
expedition' ... in search of such a basis" and that "just
because the Court is duty bound to notice the absence of
subject-matter jurisdiction, it does not follow that it is so
bound to construct theories ... to support the existence of
jurisdiction for plaintiffs who choose to stand mute in the
face of a serious jurisdictional challenge" (quoting Crutcher
v. Williams, 12 So. 3d 631, 635 (Ala. 2008))). Accordingly,
we decline to address the plaintiffs' argument, made for the
first time on appeal, that they have standing to prosecute
their action in their individual capacities as taxpayers.
This is consistent with the long-standing principle of
appellate review that we will not reverse a trial court's
judgment on a matter that was not first presented to it for
its consideration. Allsopp, supra.
II. The Plaintiffs' Standing in Their Official Capacities
A. Zeigler's Standing in His Capacity as State Auditor
14
1151313
In support of their argument that Zeigler has standing to
prosecute the plaintiffs' action in his official capacity as
State Auditor, the plaintiffs cite City Council of Prichard v.
Cooper, 358 So. 2d 440 (Ala. 1978), and City of Brundidge v.
Alabama Department of Environmental Management, 218 So.
3d
798
(Ala. Civ. App. 2016).
In Prichard, this Court held that the mayor of the City
of Prichard had standing in his capacity as mayor to prosecute
a declaratory-judgment action challenging the manner in which
members of the city council were conducting business because
the members' conduct raised "questions concerning [the
mayor's] duties under statutory law." Prichard, 358 So. 2d at
441. Similarly, in Brundidge, the Court of Civil Appeals held
that the City of Brundidge had standing to prosecute a
declaratory-judgment action challenging the Coffee County
Commission's acquisition and operation of a landfill because
the city alleged that the Coffee County Commission had
"interfered
with
[the
city's]
statutory obligations" to
manage
solid waste within the city limits of Brundidge. Brundidge,
218 So. 3d at 808. Thus, in each of those cases, the
plaintiffs (though not State officials) had standing to
15
1151313
prosecute
a
declaratory-judgment
action
alleging
an
interference with or usurpation of their statutory authority.
Relying on those two cases, the plaintiffs argue that Zeigler
has standing in his official capacity to seek a judgment
"declaring that the [defendants] must follow the law and not
usurp the constitutional and statutory powers conferred upon
[him]" as State Auditor. Plaintiffs' brief, at 29.
Regarding Zeigler's statutory powers as State Auditor,
the complaint contends that, under § 36-16-1 et seq., Ala.
Code 1975, Zeigler "has the right, duty, and statutory and
constitutional obligations to audit records of the State
Treasurer and the Department of Finance."
Regarding Zeigler's
constitutional powers as State Auditor, the complaint cites
multiple sections of the Alabama Constitution of 1901.
However, the only cited section that addresses Zeigler's
authority as State Auditor is Art. V, § 137, which provides,
in pertinent part, as quoted in the complaint:
"'The state treasurer and state auditor shall, every
year, at a time fixed by the legislature, make a
full and complete report to the governor, showing
the receipts and disbursements of every character,
all claims audited and paid out, by items, and all
taxes and revenues collected and paid into the
treasury, and the sources thereof.'"
16
1151313
According to the plaintiffs, Zeigler has statutory and
constitutional powers to audit the records of the State
Treasurer and the Department of Finance and to report annually
to the governor regarding the State's fiscal condition and
those powers bestow upon him "unique standing" to "protect the
State
...
and
its
citizens
from
[the
defendants']
unconstitutional and illegal disbursements of state funds."
However,
to
establish
standing,
a
plaintiff
must
"'demonstrate[] the existence of ... an actual, concrete and
particularized "injury in fact" –- "an invasion of a legally
protected interest."'" Ex parte King, 50 So. 3d 1056, 1059
(Ala. 2010) (quoting Alabama Alcoholic Beverage Control Bd.
v.
Henri–Duval Winery, L.L.C., 890 So. 2d 70, 74 (Ala. 2003),
quoting in turn Lujan v. Defenders of Wildlife, 504 U.S. 555,
560–61 (1992)). Unlike the plaintiffs in Prichard and
Brundidge, the plaintiffs here did not allege that the
defendants'
allegedly
unlawful
expenditures
interfered
with
or
infringed upon Zeigler's ability to fulfill his statutory and
constitutional duties of auditing certain State records and
of
reporting annually to the governor regarding the State's
17
1151313
fiscal condition.5 That is to say, although the complaint
belabored the allegation that the defendants' actions
constitute an "ongoing harm to the treasury of the State of
Alabama" (emphasis added), the complaint did not allege that
the defendants' actions constitute an "ongoing harm" to
Zeigler by interfering with or usurping his authority as State
Auditor. The plaintiffs' failure to allege that Zeigler
suffered an injury in fact in the form of an intrusion upon or
usurpation
of
his
statutory
and/or
constitutional authority
as
5The complaint did allege that § 36-16-2, Ala. Code 1975,
"confer[s] powers upon [Zeigler] that include ... authority to
require information on oath, to be administered by him, from
any person touching any claim or account he is required to
audit" and that Zeigler "has attempted, in furtherance of his
duties, to obtain information ... from ... Bentley but ...
Bentley has refused to comply with his demands." Thus, the
complaint continued, Zeigler had "no alternative" but to file
this action "in order to obtain information Alabama law
requires him to obtain from any person touching any claim or
account he is required to audit."
However, the plaintiffs make no argument on appeal
regarding any attempts by Zeigler to obtain information from
the governor's office. Moreover, we fail to see how a
judgment declaring that the defendants have violated the Act
and enjoining further expenditures that contravene the Act
would afford Zeigler any relief with respect to the
plaintiffs' allegation that the governor's office has failed
to comply with his requests for information. See Henri-Duval
Winery, 890 So. 2d at 74 (noting that, to establish standing,
a party must demonstrate "a likelihood that the injury will be
'redressed by a favorable decision'" (quoting Lujan, 504 U.S.
at 560–61)).
18
1151313
State Auditor is fatal to the plaintiffs' argument that
Zeigler has standing to prosecute their action in his official
capacity. Accordingly, the trial court did not err in finding
that Zeigler lacked standing to prosecute the plaintiffs'
action in his capacity as State Auditor.6
B. Morrow's Standing in His Capacity as a Member of the
Legislature
As noted above, the plaintiffs alleged that the
defendants' funding of the project (1) violated the Act
because, they say, none of the funds "now being expended and
disbursed ... are derived from any source of funds allowed by
[the Act] to be so expended or disbursed" on the project and
(2) operated to
usurp the legislature's appropriation power by
funding the project "without a lawful appropriation by the
State Legislature." Thus, the plaintiffs argue, the
defendants' alleged refusal to comply with previously enacted
6Alternatively, the complaint, as to Zeigler, simply
failed to present the "'bona fide justiciable controversy'"
required for a declaratory-judgment action because, although
it alleged that the defendants' actions were unlawful, it
failed to identify, as to Zeigler, any "present 'legal rights
[that are being] thwarted or affected [so as] to warrant
proceedings under
the
Declaratory
Judgment
statutes.'"
Creola
Land Dev., Inc. v. Bentbrooke Hous., L.L.C., 828 So. 2d 285,
288 (Ala. 2002) (quoting Gulf South Conference v. Boyd, 369
So. 2d 553, 557 (Ala. 1979), and Town of Warrior v. Blaylock,
275 Ala. 113, 114, 152 So. 2d 661, 662 (1963)).
19
1151313
legislation and the alleged usurpation of the legislature's
appropriation
power
establishes
Morrow's
standing
to
prosecute
the plaintiffs' action in his capacity as a member of the
legislature.
As set forth above, in order to demonstrate that he has
standing to prosecute the plaintiffs' action in his capacity
as a legislator, Morrow must "'demonstrate[] the existence of
... an actual, concrete and particularized "injury in fact" –-
"an invasion of a legally protected interest."'" King, 50 So.
3d at 1059. "Legislators have no special right to standing
simply by virtue of their status: like other plaintiffs,
legislators must establish a distinct, concrete injury in
fact." American Civil Liberties Union of Tennessee v.
Darnell, 195 S.W.3d 612, 625 (Tenn. 2006). See also Markham
v. Wolf, 635 Pa. 288, 298, 136 A.3d 134, 140 (2016) (noting
that there is no "special category of standing for
legislators" and that "[s]tanding for legislators claiming an
institutional
injury
is
no
different
than
traditional standing
and, in order for legislators to bring a particular challenge,
the
legislators
must
satisfy
the
prudential
standing
criteria"); and Hendrick v. Walters, 865 P.2d 1232, 1236
20
1151313
(Okla. 1993) ("When a member of the law-making assembly
initiates legal proceedings in a representational capacity as
a senator or a member of the House of Representatives, that
legislator can claim no elevated status in establishing
standing. The lawmaker must meet the same threshold criteria
required of any other litigant." (emphasis and footnotes
omitted)).
In fact, not only are legislators not cloaked with a
"special category of standing," Markham, 635 Pa. at 298, 136
A.3d at 140, but also, "to establish standing, a legislator
must overcome a heavy burden" because "[c]ourts are reluctant
to hear disputes that may interfere with the separation of
powers between the branches of government." Dodak v. State
Admin. Bd., 441 Mich. 547, 555, 495 N.W.2d 539, 543 (1993).
See also Turner v. Shumlin, 163 A.3d 1173, 1178 (Vt. 2017)
(noting that, "[a]lthough legislators, like other plaintiffs,
must
satisfy
[the] elements
to
demonstrate
standing,
separation of powers and the limited role of the judiciary
compel particular scrutiny in determining whether there is an
injury in fact" (internal citations omitted)).
21
1151313
This Court has not expressly addressed what constitutes
an "injury in fact," King, supra, to a legislator in his or
her capacity as a legislator sufficient to establish standing
to sue in that official capacity. In Riley v. Joint Fiscal
Committee of Alabama Legislature, 26 So. 3d 1150 (Ala. 2009),
this Court, without discussing standing, affirmed a summary
judgment in favor of legislators who had filed a claim
alleging that then governor Bob Riley had exercised the line-
item veto power in an unconstitutional manner.7 Thus, it
appears that this Court has at least implicitly determined
that a legislator can, under some circumstances, suffer an
injury in his or her capacity as a legislator that will confer
upon him or her standing to sue in that official capacity.
7Riley had previously petitioned this Court for a writ of
mandamus directing the dismissal of the action. See Ex parte
Riley, 11 So. 3d 801 (Ala. 2008). Although Riley had argued
in his motion to dismiss that the legislators lacked standing,
the Court stated that the "sole issue ... is whether ... the
underlying case is ripe for review." Id. at 806. Determining
that the case was ripe, the Court denied Riley's petition
without discussing the issue of standing.
Chief
Justice
Cobb,
however,
authored
a
special
concurrence in which she concluded "that the legislators here
suffered a legally significant injury that gave rise to a
definite and concrete controversy sufficient to ensure both
that they had standing to sue and that the issue they
presented was ripe for review ...." Id. at 810 (Cobb, C.J.,
concurring specially).
22
1151313
However, Riley cannot be read as a carte blanche establishment
of standing so as to allow legislators to challenge any
executive action. Rather, as noted, a legislator seeking to
establish standing in his or her official capacity as a
legislator must demonstrate that he or she has suffered "'an
actual, concrete and particularized "injury in fact"'" in
that
capacity. King, 50 So. 3d at 1059. See also Darnell,
Markham, and Hendrick, supra. Thus, the dispositive question
regarding Morrow's standing as a legislator in this case is
whether an allegation that officials in the executive branch
have refused or failed to comply with the provisions of
previously enacted legislation –- and, in doing so, have
usurped the legislature's appropriation power -- constitutes
an injury in fact to an individual legislator sufficient to
establish standing in his or her capacity as a legislator to
prosecute an action challenging the actions of the executive-
branch officials.
Courts that have addressed the issue of legislator
standing have held that a legislator suffers an injury in fact
in his or her capacity as a legislator only in limited
circumstances, which typically include (1) allegations that
23
1151313
the legislator has been deprived of his or her right to vote
or that his or her legislative votes have been nullified and
(2) allegations that the legislator has been deprived of his
or her constitutional right to advise and consent on executive
appointments or other matters upon which a legislator has a
right to act. See, e.g., Turner, 163 A.3d at 1179 (holding,
and noting that other courts have held, that a senator had
"legislative
standing
when
a
governor's
conduct
concerning
the
appointment of state officers interfered with the complaining
legislators'
constitutional
duty
to
provide
advice
and
consent
with regard to the appointments"); McDermott v. Ige, 135 Haw.
275, 287, 349 P.3d 382, 394 (2015) (noting that both federal
and state caselaw "show that ... a legislator may indeed have
standing to challenge a law if his or her vote was nullified
or if he or she was unlawfully deprived of the right to
vote"); Hanabusa v. Lingle, 119 Haw. 341, 348, 198 P.3d 604,
611 (2008) (holding that legislators' allegation that the
governor had usurped their right to advise and consent on
executive
appointments
was
"'sufficiently
personal
to
constitute an injury in fact'" (quoting Dennis v. Luis, 741
F.2d 628, 631 (3d Cir. 1984))); State ex rel. Ohio Gen.
24
1151313
Assembly v. Brunner, 114 Ohio St. 3d 386, 391, 872 N.E.2d 912,
919 (2007) (holding that legislators had standing to
prosecute
an action seeking "to prevent nullification of their
individual votes" by executive officials' refusal to treat a
bill as validly enacted law); Silver v. Pataki, 96 N.Y.2d 532,
536, 755 N.E.2d 842, 845, 730 N.Y.S.2d 482, 485 (2001)
(holding that a legislator had standing to challenge the
constitutionality of the governor's veto power on the basis
that a legislator "can maintain an action 'to vindicate the
effectiveness of his vote where he is alleging that the
Governor has acted improperly so as to usurp or nullify that
vote'" (quoting Silver v. Pataki, 274 A.D.2d 57, 67, 711
N.Y.S.2d 402, 410 (2000) (Williams, J., dissenting))); and
Fordice v. Bryan, 651 So. 2d 998, 1003 (Miss. 1995) (holding
that legislators had standing to challenge the governor's use
of the veto power because the legislators' votes "were
adversely affected by the Governor's vetoes").8
However, when legislators have attempted to challenge
executive action on the grounds that it failed to comply with
8Given that Riley concerned the constitutionality of then
governor Riley's use of the line-item veto to veto parts of
the legislature's 2009 general-fund-appropriations bill, it
appears that Riley is in accord with the above-cited caselaw.
25
1151313
previously enacted legislation or amounted to a usurpation of
the legislature's appropriation power, courts have generally
determined that the alleged injury is too attenuated and,
thus, have been reluctant to conclude that the legislators had
suffered "an actual, concrete and particularized 'injury in
fact,'" King, 50 So. 3d at 1059, in their capacity as
legislators sufficient to establish standing to sue in that
capacity.
In Markham, supra, legislators sought to intervene in an
action filed against the Governor of Pennsylvania challenging
the Governor's issuance of an executive order that allegedly
conflicted with existing law and, the legislators argued, "was
an unauthorized attempt by the Governor to exercise
legislative power in violation of the separation of powers
doctrine." 635 Pa. at 292-93, 136 A.3d at 137. In holding
that the legislators lacked standing to intervene, the
Supreme
Court of Pennsylvania discussed Wilt v. Beal, 26 Pa. Cmwlth.
298, 363 A.2d 876 (1976), the case of first impression in
Pennsylvania regarding legislator standing.
In Wilt, W. William Wilt, a legislator, sought to enjoin
executive officials from allegedly unlawfully operating a
26
1151313
recently completed mental-health-care facility and sought the
reimbursement of any moneys expended in the operation of the
facility. The Commonwealth Court of Pennsylvania discussed
federal caselaw regarding legislator standing and noted that,
in those cases, a legislator had been denied standing "to
contest actions which he claimed impaired the
effectiveness of
legislation for which he had voted and on which his vote was
duly counted." 26 Pa. Cmwlth. at 305, 363 A.2d at 881
(emphasis added). In concluding that Wilt lacked standing,
the Supreme Court of Pennsylvania stated:
"What emerges from this review of the federal
cases is the principle that legislators,
as
legislators, are granted standing to challenge
executive actions when specific powers unique to
their
functions
under
the
Constitution
are
diminished or interfered with. Once, however, votes
which they are entitled to make have been cast and
duly counted, their interest as legislators ceases.
Some other nexus must then be found to challenge the
allegedly unlawful action. ... To give but one
familiar
example,
under
the
Pennsylvania
Constitution, members of the Senate have the duty to
approve or disapprove certain appointments made by
the Governor. Interference with the performance of
this duty would be an injury to members of the
Senate sufficient to give each senator standing to
protect the injury to his or her 'constitutional
right' to vote for or against confirmation of an
executive appointee.
"Applying this reasoning to the case at hand, we
find no connection between Wilt's status as a
27
1151313
legislator and any constitutional provision alleged
to have been breached by the defendants' actions.
Wilt complains that the purpose of the bill for
which he had voted has been frustrated, thus
depriving him of the effectiveness of his vote.
However, once Wilt's vote had been duly counted and
the bill signed into law, his connection with the
transaction as a legislator was at an end.
Therefore, he retains no personal stake ... in the
outcome of his vote which is different from the
stake each citizen has in seeing the law observed.
He therefore has no standing to sue in his capacity
as a legislator."
26 Pa. Cmwlth. at 305-06, 363 A.2d at 881 (emphasis added).
After discussing Wilt and other Pennsylvania caselaw and
federal caselaw, the Supreme Court of Pennsylvania concluded
in Markham:
"What emanates from our Commonwealth's caselaw,
and
the
analogous
federal
caselaw,
is
that
legislative standing is appropriate only in limited
circumstances.
Standing exists only when a
legislator's direct and substantial interest in his
or her ability to participate in the voting process
is negatively impacted, ... or when he or she has
suffered a concrete impairment or deprivation of an
official power or authority to act as a legislator
.... These are injuries personal to the legislator,
as a legislator. By contrast, a legislator lacks
standing where he or she has an indirect and less
substantial
interest
in
conduct
outside
the
legislative forum which is unrelated to the voting
or approval process, and akin to a general grievance
about the correctness of governmental conduct,
resulting
in
the
standing
requirement
being
unsatisfied. ...
28
1151313
"Upon
consideration,
we
find
that
Appellants
are
not aggrieved, as that term is understood in the
standing context, because their interests in the
underlying challenge to [the executive order] are
too indirect and insubstantial. [The executive
order] does not inhibit or in any way impact
Appellants' ability to propose, vote on, or enact
legislation. The order does not touch upon the
constitutional or legislative prerequisites for the
voting upon and enacting of legislation. Nor does
the order prevent Appellants from acting as
legislators with respect to advising, consenting,
issuing, or approving matters within their scope of
authority as legislators. Rather, the legislators'
claim of aggrievement is only that the recently
enacted [executive order] is a violation of the
separation-of-powers doctrine, in that, they claim,
it
diminishes
the
effectiveness
of,
or
is
inconsistent with, prior-enacted legislation. Yet,
these claims of injury reflect no impact on
Appellants' right to act as legislators, and are
more, in our view, in the nature of a generalized
grievance about the correctness of governmental
conduct. Simply stated, the assertion that another
branch of government –- here, the executive branch
through the Governor's Executive Order –- is
diluting the substance of a previously-enacted
statutory
provision
is
not
an
injury
which
legislators, as legislators, have standing to
pursue.
"Indeed, taking the unprecedented step of
allowing legislators standing to intervene in, or be
a party to, any matter in which it is alleged that
government action is inconsistent with existing
legislation would entitle legislators to challenge
virtually every interpretive executive order or
action (or inaction)."
635 Pa. at 305-06, 136 A.3d at 145 (emphasis added).
29
1151313
Thus, the Supreme Court of Pennsylvania's determination
that the legislators in Markham lacked standing was based on
its conclusion that the issuance of the executive order did
not
interfere
with
"unique
legislative prerogatives" and
"only
remotely impact[ed] the legislators' right to act as
legislators." 635 Pa. at 291, 136 A.3d at 136 (emphasis
added). Significantly, the Supreme Court of Pennsylvania was
unpersuaded by the legislators' argument that they had
standing because, they said, the executive order had
"diminishe[d] the effectiveness of, or [was] inconsistent
with, prior-enacted legislation." 635 Pa. at 306, 136 A.3d at
145. That is to say, the legislators argued that they had
standing because, they alleged, the executive order affected
legislation on which they had already acted. However, the
Supreme Court of Pennsylvania concluded that, even if that
allegation was true, the executive order did not interfere
with the legislators' power to act in the first instance.
Thus, the Court concluded, the legislators' alleged injury was
simply
"too
indirect
and
insubstantial" to
establish standing.
Id. See also Russell v. DeJongh, 491 F.3d 130, 134-35 (3d
Cir. 2007) (noting that "the authorities appear to hold
30
1151313
uniformly that an official's mere disobedience or flawed
execution of a law for which a legislator voted ... is not an
injury in fact for standing purposes" but that "an official's
'distortion of the process by which a bill becomes law' by
nullifying a legislator's vote or depriving a legislator of an
opportunity to vote ... is an injury in fact"); Alons v. Iowa
Dist. Court for Woodbury Cty., 698 N.W.2d 858, 872-73, 874
(Iowa 2005) (rejecting the notion that legislators have
standing to "see[] that the 'law ... is properly enforced'" on
the grounds that, "when the only claim is nonobservance of the
law, such claim affects only the generalized interest of all
citizens" and "[a]ny injury resulting from such nonobservance
is abstract in nature and not sufficient for standing"); and
Chiles v. Thornburgh, 865 F.2d 1197, 1205 (11th Cir. 1989)
(rejecting a senator's argument that he had "a right to see
that the laws, which he voted for, are complied with" on the
ground that "[s]uch a claim of injury ... is nothing more
than a 'generalized grievance[] about the conduct of the
government'" that did not constitute "a legally cognizable
injury" (quoting Flast v. Cohen, 392 U.S. 83, 106 (1968))).
31
1151313
Similarly,
in
Commonwealth
ex
rel.
Beshear
v.
Commonwealth Office of the Governor ex rel. Bevin, 498 S.W.3d
355 (Ky. 2016), the Supreme Court of Kentucky considered
whether legislators had standing to prosecute an action
alleging that the governor of Kentucky had violated the
separation-of-powers doctrine by "reduc[ing] the amount of
money made available to a state university under a legislative
appropriation," i.e., that the governor had failed to comply
with previously enacted legislation. 498 S.W.3d at 359. In
holding that the legislators lacked standing, the Supreme
Court of Kentucky stated:
"The idea that individual legislators have standing
to challenge an action by the Governor –- under the
premise of an injury to an interest in a statute
being carried out properly or the legislators' duty
to vote on legislation –- is simply too attenuated
to create a justiciable controversy. A legislator
has no individual ownership of any enacted piece of
legislation and certainly can pass no legislation as
an individual. ...
"....
"Individual legislators simply do not have a
sufficient personal stake in a dispute over the
execution or constitutionality of a statute, even
when the claim is that another branch of government
is violating the separation of powers."
498 S.W.3d at 367-68 (emphasis added).
32
1151313
Thus, in Beshear, as in Markham, the allegation that the
governor's
actions
violated
previously
enacted
legislation
was
insufficient to confer standing upon the legislators because
the governor's actions had not infringed upon the
legislators'
power to act; rather, the alleged injury was, as it was in
Markham, that the governor's actions were not in compliance
with statutory law on which the legislature had already
acted.9 Likewise, in Mottl v. Miyahira, 95 Haw. 381, 23 P.3d
716 (2001), legislators filed an action alleging that
officials in the executive branch had violated the
separation-
of-powers doctrine by reducing the University of Hawaii's
budgetary allocation below the amount appropriated by the
legislature. The legislators argued that they had standing
because they had "'not only the interest of a general member
of the public in seeing that the laws of the state are
complied with, but the interest of persons who have spent
their own official time on behalf of their constituents,
9Because
the
Supreme
Court
of
Kentucky
determined that
the
attorney general of Kentucky, who was also a plaintiff, did
have standing to prosecute the action, it addressed the merits
of the appeal and held that the governor had exceeded his
statutory authority. Thus, even when it is conclusively
determined
that
an
executive-branch official's
actions
are
not
in compliance with previously enacted legislation, individual
legislators do not have standing to challenge the action.
33
1151313
reviewing, voting on, and enacting budgets that become law.'"
95 Haw. at 392, 23 P.3d at 727. In concluding that the
legislators lacked standing, the Supreme Court of Hawaii
stated that the legislators' argument
"establishes [the legislators'] 'special interest'
but not an 'injury in fact.' [The legislators] have
not alleged any 'personal stake in the outcome of
the controversy,' inasmuch as they have not alleged
that they had personally suffered any 'distinct and
palpable injury.' Because a 'special interest' in
the subject matter of a lawsuit is insufficient to
invoke judicial intervention, [the legislators] are
without standing in this action."
Id. (quoting Akinaka v. Disciplinary Bd. of Hawai'i Supreme
Court, 91 Haw. 51, 55, 979 P.2d 1077, 1081 (1999)) (internal
citation omitted). Thus, although the legislators claimed
that their status as legislators established a "special
interest," and thus standing, to see that the executive
officials complied with the budgetary allocation already
passed by the legislature, the Supreme Court of Hawaii held
that the legislators had failed to allege an injury in fact in
their capacities as legislators as a result of the executive-
branch officials' failure to comply with previously enacted
legislation.
34
1151313
What can be gleaned from the caselaw discussed above is
that a mere allegation that executive action is unlawful
because it fails to comport with previously enacted
legislation is simply too attenuated to establish an injury in
fact to a single legislator and, thus, is an insufficient
ground upon which the single legislator can
establish standing
to challenge the executive action. This is so because, as the
Supreme Court of Pennsylvania noted in Wilt, supra, once a
legislator's vote on a bill has been counted and the bill
signed into law, the legislator's "connection with the
transaction as a legislator," Wilt, 26 Pa. Cmwlth. at 306, 363
A.2d at 881, is at an end, and a subsequent failure to comply
with the provisions of validly enacted legislation is nothing
more than "a generalized grievance about the correctness of
governmental conduct" that does not in any manner impact a
single legislator's ability to act in his or her capacity as
a legislator. Markham, 635 Pa. at 306, 136 A.3d at 145. Put
differently, an allegation "that the purpose of the bill for
which [a legislator] had voted has been frustrated" is
different from an allegation that actions of executive-branch
officials have operated to prevent a legislator from
35
1151313
exercising his or her legislative authority in the first
instance. Wilt, 26 Pa. Cmwlth. at 306, 363 A.2d at 881.
That is not to say that a legislature as a whole does not
have an interest in seeing its validly enacted laws executed
in accordance with their provisions and, thus, standing to
bring an action seeking to ensure that executive officials
comply with statutory law. See Arizona State Legislature v.
Arizona Indep. Redistricting Comm'n, ___ U.S. ___, ___, 135
S.Ct. 2652, 2664 (2015) (concluding that the Arizona
legislature as a body had standing because it "assert[ed] an
institutional injury, and it commenced [the] action after
authorizing votes in both of its chambers"); Biggs v. Cooper
ex rel. County of Maricopa, 263 Ariz. 415, 418, 341 P.3d 457,
460 (2014) (noting that the Arizona Supreme Court has held
that "individual legislators lack standing because they do
not
suffer an 'injury to a private right or to themselves
personally' when they simply complain that their votes were
counted, but the effect was nullified by the governor's acts,"
but that it had held that "the legislature as a body suffers
a direct institutional injury, and so has standing to sue,
when an invalid gubernatorial veto improperly overrides a
36
1151313
validly enacted law" (emphasis added)); and Raines v. Byrd,
521 U.S. 811, 821 (1997) (noting that the legislators' claim
was "a type of institutional injury (the diminution of
legislative power), which necessarily damages all Members of
Congress and both Houses of Congress equally"). See also
Anthony Clark Arend & Catherine B. Lotrionte, Congress Goes to
Court: The Past, Present, and Future of Legislator Standing,
25 Harv. J.L. & Pub. Pol'y 209, 274 ("[A]n institutional
injury can only occur to the institution as a whole.
Accordingly, only the entity that is injured, the Senate, the
House, or Congress, should be regarded as an injured party for
standing purposes.").
Similarly,
the
plaintiffs'
allegation
that
the
defendants' alleged funding of the project with moneys not
authorized by the Act was a usurpation of the legislature's
appropriation power alleges an institutional injury to the
legislature as a whole because only the legislature can
appropriate State funds; Morrow, individually, cannot. See
Kerr v. Hickenlooper, 824 F.3d 1207, 1215 (10th Cir. 2016)
(holding that legislators' allegation that they had been
"deprive[d] ... of their ability to perform the 'legislative
37
1151313
core function[] of ... appropriation'" was an institutional
injury and that, therefore, the legislators, absent the
legislature's authorization, lacked standing to prosecute the
action on the legislature's behalf); Conant v.
Robins, Kaplan,
Miller & Ciresi, L.L.P., 603 N.W.2d 143, 150 (Minn. Ct. App.
1999) (holding that "it is apparent that the senator is
alleging an institutional, not a personal, injury" where the
senator alleged that state funds had been expended without a
legislative
appropriation);
and
Harrington
v.
Schlesinger,
528
F.2d 455 (11th Cir. 1975) (holding that four federal
legislators whose complaint alleged that executive-branch
officials' unauthorized expenditures violated the United
States Constitution's Appropriation Clause lacked standing to
prosecute the action). A single legislator, acting
individually, does not have standing to prosecute an injury to
the entire legislature.
It has been suggested that a small bloc of legislators
might have standing to prosecute, on behalf of the
legislature, an action alleging an institutional injury when
it has been authorized by the legislature to do so. See
Beshear, 498 S.W.3d at 368 ("The individual legislators have
38
1151313
not shown that they are representative of the entire body of
the General Assembly. They 'have not been authorized to
represent their respective Houses ... in this action.'"
(quoting Raines, 521 U.S. at 829)); Kerr, 824 F.3d at 1215
("In determining whether a party may rely on an institutional
injury to demonstrate standing, the Court has considered
whether the plaintiffs represent their legislative body as an
institution."); Bennett v. Napolitano, 206 Ariz. 520, 527, 81
P.3d 311, 318 (2003) ("Nor can these four petitioners assert
standing to litigate claims of injury to the legislature as a
whole. ... Petitioners here, consisting of four of ninety
members of the legislature, have not been authorized by their
respective chambers to maintain this action. When a claim
allegedly belongs to the legislature as a whole, four members
who bring the action without the benefit of legislative
authorization should not, except perhaps in the most
exceptional circumstances, be accorded standing to obtain
relief on behalf of the legislature."); Raines, 521 U.S. at
829 ("We attach some importance to the fact that appellees
have not been authorized to represent their respective Houses
of Congress in this action, and indeed both Houses actively
39
1151313
oppose their suit."); and Dodak, 441 Mich. at 553, 495 N.W.2d
at 542 (noting that the legislators' action "had not been
authorized by either House"). See also Arend & Lotrionte, 25
Harv. J.L. & Pub. Pol'y at 275 ("Because decisions by Congress
are made by vote as a collective whole, one or several members
should not be able to 'step into the shoes of the' Congress
and invoke its claim to injury. ... Absent the consent of the
body, an individual member would thus be powerless to sue.").
Absent such authorization, however, it does not appear
that other jurisdictions have found that either a single
legislator or a small bloc of legislators has standing to
prosecute an action alleging an institutional injury to the
legislature. Indeed, to hold otherwise could result in a
scenario where a single legislator, perceiving a "separation-
of-powers injury" to the legislature as a whole, purports to
bring an action seeking to redress the alleged injury, yet the
majority of the legislature he or she purports to represent
perceives no injury at all. See Raines, 521 U.S. at 829
(noting that the action had been brought by only six members
of Congress but that "both Houses actively oppose" the
action).
40
1151313
In this case, the plaintiffs alleged that the defendants'
actions with respect to the funding of the project violated
the Act and operated to usurp the legislature's appropriation
power. To the extent those actions constituted injuries at
all, they are injuries to the legislature as a whole, but not
to Morrow as an individual legislator, and, although the
plaintiffs have
arguably
alleged
institutional
injuries
to
the
legislature, they have not indicated that Morrow has been
authorized to prosecute the action on behalf of the
legislature. In fact, for all that appears, Morrow is the
only member of the legislature who perceives an injury to the
legislature as a result of the defendants' allegedly unlawful
actions. Accordingly, because the plaintiffs' complaint
alleged, at most, institutional injuries to the
legislature as
a whole, and because there is no indication that Morrow has
been authorized to prosecute the plaintiffs' action on behalf
of the legislature, the trial court did not err in determining
that Morrow lacked standing to prosecute the plaintiffs'
action in his capacity as a legislator.
Conclusion
41
1151313
Because the issue of the plaintiffs' standing in their
individual capacities has not been preserved for appellate
review and because the plaintiffs do not have standing to
prosecute their action in their official capacities, the
trial
court did not err in dismissing the complaint. Accordingly,
the judgment is affirmed.
AFFIRMED.
Stuart, C.J., and Bolin, Shaw, Bryan, and Sellers, JJ.,
concur.
Parker and Wise, JJ., concur in the result.
Main, J., recuses himself.
42 | November 3, 2017 |
370bf71a-d2d3-4f34-adc6-1a1939f9252e | Norvell v. Parkhurst | N/A | 1160696 | Alabama | Alabama Supreme Court | REL: November 9,2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
____________________
1160696
____________________
Carter C. Norvell and Parkhurst & Norvell, an Alabama
General Partnership
v.
Candy Parkhurst, personal representative of the Estate of
Andrew P. Parkhurst, deceased
Appeal from Lauderdale Circuit Court
(CV-14-900427)
STUART, Chief Justice.
Candy
Parkhurst
("Parkhurst"),
personal
representative
of
the estate of her husband, Andrew P. Parkhurst ("Andrew"),
deceased, initiated an action in the Lauderdale Circuit Court
1160696
for the purpose of compelling Carter C. Norvell and Parkhurst
& Norvell, an accounting firm Norvell had operated as a
partnership with Andrew ("the partnership"), to arbitrate a
dispute regarding the dissolution of the partnership.
Pursuant to an arbitration provision in a dissolution
agreement Norvell and Andrew had executed before Andrew's
death, the trial court ultimately ordered arbitration and
stayed further proceedings until arbitration was complete.
Subsequently, however, Parkhurst moved the trial court to
lift
the stay and to enter a partial summary judgment resolving
certain aspects of the dispute in her favor. After the trial
court lifted the stay and scheduled a hearing on Parkhurst's
motion, Norvell and the partnership filed the instant appeal,
arguing that the trial court was effectively failing to
enforce the terms of a valid arbitration agreement in
violation of the Federal Arbitration Act ("the FAA"), 9 U.S.C.
§ 1 et seq. We reverse and remand.
I.
Andrew and Norvell, both certified public accountants,
began practicing together in 1993. In October 1995, they
executed a partnership agreement formally creating the entity
2
1160696
known as Parkhurst & Norvell. For all that appears, they
worked together in harmony until approximately March 2010,
when Norvell alleges that he discovered Andrew had been using
partnership funds for personal expenses. Norvell asserts that
Andrew, upon being confronted, acknowledged that he had been
misusing partnership funds for many years but stated that he
would take corrective measures that included modifying the
amounts in their respective capital accounts.
Although Andrew
apparently did make some subsequent adjustments to their
capital accounts, Norvell claims that Andrew made no
adjustments to account for his misuse of partnership funds in
the years before 2010.
On June 14, 2011, Andrew and Norvell executed a
dissolution agreement setting forth the framework for
dissolving the partnership effective June 30, 2011. Under the
terms of that agreement, Andrew agreed to retire from public
accounting and to encourage his clients to henceforth use
Norvell's services; in return, Norvell agreed to pay Andrew a
percentage of billings collected from those clients monthly
over the next five years. The agreement also provided that
Norvell would make a final reconciliation of their capital
3
1160696
accounts in the partnership and remit to Andrew any sum Andrew
was due, along with $150,000 representing Andrew's equity in
the partnership's office building, within 30 days of "the
closing of the books." Finally, paragraph 1 of the
dissolution agreement contained the following arbitration
provision:
"The partners agree to dissolve the partnership
effective June 30, 2011, in accordance with section
12 of the partnership agreement. [Norvell] will act
in the capacity of liquidating partner. [Norvell]
will make a determination of the reconciliation of
the capital accounts. [Norvell] shall provide a
final,
detailed
reconciliation
and
supporting
documentation to [Andrew]. In the event there is a
dispute with regard to reconciliation of the capital
accounts, the parties agree to resolve the dispute
by binding arbitration. For purposes hereof, the
parties shall select a mutually agreeable CPA or
attorney to serve as the arbitrator, who shall then
review the records of the business, make inquiry of
the parties as to any transactions that are
disputed, and, if (s)he deems necessary, conduct a
hearing
of
the
matter
with
the
parties
in
attendance. At any such hearing, the parties may
bring
legal
or
other
representation.
Upon
conclusion of the review of records and/or hearing,
the
arbitrator
shall
make
a
written
report
effectively reconciling the capital accounts and the
parties agree to be legally and forever bound
thereby."
Paragraph 12 of the dissolution agreement further provided:
"The parties agree to reasonably cooperate with
each other as to any matters arising out of the
dissolution of the partnership, including, but not
4
1160696
limited to, reconciliation of capital accounts,
matters relating to tax returns and any tax audits
and related appeals, claims or litigation, and in
the winding up of the partnership business affairs.
Further, [Andrew] or his representatives, upon
reasonable request at such times and in such manner
as is mutually agreeable to [Norvell], shall be
permitted full access to examine the books of
[Norvell] relative to [Andrew's] clients and the
payments made to Andrew pursuant to section 4
hereof. In the event of any disputes that cannot be
resolved by the parties, the arbitration process
(including the named arbitrator or alternative
arbitrator approved by both parties) shall govern."
Parkhurst
asserts
that
Andrew
complied
with
his
obligations under the terms of the dissolution agreement and
that he encouraged his former clients to use Norvell as their
accountant.1 In return, Norvell initially made the required
monthly payments to Andrew; however, at some point –– it is
not clear from the record exactly when –– he stopped making
those payments. On October 12, 2012, Norvell delivered to
Andrew the final reconciliation of the partners' capital
accounts he was obligated by the dissolution agreement to
produce. After reviewing the partnership's business records
going back to 1993 and making adjustments for transactions
1Norvell at some point accused Andrew of violating a
covenant not to
compete in the dissolution agreement; however,
the details of that accusation are not contained in the record
before us.
5
1160696
performed
by
Andrew
that
Norvell
now
deemed
to
be
illegitimate, Norvell concluded that Andrew's capital account
had a negative balance of $3,406,622. Andrew died on January
11, 2013, and, on August 14, 2013, Norvell filed a claim
against Andrew's estate for $4,149,655, based on
that negative
balance and other expenses Andrew allegedly owed the
partnership.
It appears that, at some point in time, Norvell also
initiated a lawsuit against Deborah Henderson Smith, who
appears to have had some business involvement with Norvell,
Andrew, and/or the partnership related to the estate of a
deceased relative. The record in this case does not disclose
the facts underlying that lawsuit; however, it appears that
Andrew's
estate
eventually became
involved
and
asserted
cross-
claims against Norvell, eventually moving the trial court to
compel arbitration of those cross-claims pursuant to the
arbitration
provision
in
the
dissolution
agreement.
Subsequently, however, Norvell argued that those cross-claims
were not related to the Deborah Henderson Smith action and
should be resolved in a separate proceeding; Parkhurst
eventually agreed and withdrew her motion to compel
6
1160696
arbitration, notifying the trial court that she
would initiate
a separate action instead.
On September 22, 2014, Parkhurst initiated that new
action, alleging (1) that Norvell had made invalid and
illegitimate adjustments to Andrew's capital account and (2)
that Norvell had failed to make the monthly payments required
by the dissolution agreement. Parkhurst simultaneously
requested that the trial court compel arbitration of the
dispute pursuant to the terms of the dissolution agreement.
Norvell initially opposed that request and Parkhurst's
subsequent formal motion to compel arbitration, questioning
whether the dispute involved interstate commerce and arguing
that neither Parkhurst nor the partnership was a party to the
dissolution agreement; on March 16, 2015, the trial court
granted Parkhurst's motion to compel arbitration and stayed
the action "until the arbitration is completed and an award is
entered."2
2On July 24, 2015, the trial court did act to appoint an
arbitrator after Parkhurst and Norvell were unable to agree on
an arbitrator. See generally Robertson v. Mount Royal Towers,
134 So. 3d 862, 869 (Ala. 2013).
7
1160696
On August 17, 2015, Parkhurst initiated arbitration
proceedings by filing a statement of claim with the
arbitrator, requesting that he
"enter an order disallowing the capital account
adjustments made by Norvell, properly reconcile the
capital accounts, award to [Parkhurst] the balance
due of [Andrew's] capital account, award to
[Parkhurst] the amount past due on the monthly
payments required [by the dissolution agreement],
order that monthly payments in the future are due to
be made by Norvell, and award [Parkhurst] all
recoverable interest, legal fees and costs of this
proceeding."
The parties thereafter engaged in limited discovery as
authorized by the arbitrator. On November 21, 2016, Parkhurst
filed a "motion for partial summary judgment" with the
arbitrator, requesting him to hold that Norvell was bound by
the partnership's 2010 tax return, which indicated that
Andrew's capital account had a balance of $135,170 as of
October 2011. Parkhurst argued that Norvell had completed and
submitted this tax return under penalty of perjury after the
dissolution agreement had been executed and with knowledge of
Andrew's alleged misuse of partnership funds and that it would
accordingly be inappropriate to allow him to subsequently
conduct another reconciliation going back all the way to 1993.
In support of her arguments, Parkhurst cited the statutes of
8
1160696
limitations
applicable
to
breach-of-fiduciary-duty
and
contract claims, and the doctrines of waiver, estoppel,
ratification, acquiescence, and delay in disaffirmance. In
the alternative, Parkhurst argued that Norvell should be
bound
by the partnership's 2011 tax return, which was completed and
submitted by Norvell in October 2012 and covered the period
through the June 2011 dissolution of the partnership. This
2011 tax return indicated that the balance in Andrew's capital
account at that time was $0. Essentially, Parkhurst desired
the arbitrator to enter the equivalent of an interlocutory
order holding that the final reconciliation of the partners'
capital accounts could not take into account any misuse of
partnership funds by Andrew that occurred before 2010.
On November 22, 2016, Norvell wrote the arbitrator
expressing his position that in her motion Parkhurst was
effectively asking the arbitrator to exceed his authority.
The
governing
arbitration
provision,
Norvell
argued,
empowered
the arbitrator only to "review the records of the business,
make inquiry of the parties as to any transactions that are
disputed, and, if (s)he deems necessary, conduct a hearing of
the matter .... Upon conclusion of the review of records
9
1160696
and/or hearing, the arbitrator shall make a written report
effectively reconciling the capital accounts." Norvell
further emphasized that the arbitration provision did
not
even
require an attorney to fulfill this role; it contemplated a
certified public accountant serving as the arbitrator if the
parties agreed. On December 19, 2016, Norvell supplemented
his November 22 letter with a memorandum further arguing that
"neither the FAA nor the executed [dissolution agreement]
provide the arbitrator with authority to grant dispositive
motions."3
On or around December 20, 2016, the arbitrator conducted
a telephone conference call with the parties. There is no
transcript of this call in the record, and the parties'
descriptions of this call differ substantially. In a
subsequent filing made in the trial court, Parkhurst states:
"In that conference call, it was discussed and
agreed with [the arbitrator] that this motion for
partial summary judgment would be submitted to the
circuit court given [Norvell's] position that the
circuit court is where these issues must be decided.
No mention was made then by [Norvell] that this
court could not or should not hear these issues. It
was voiced by all participants that a hearing in
3Norvell also argued that there was nothing in the
dissolution agreement limiting the time or scope of the
arbitrator's review of the partners' capital accounts.
10
1160696
court would provide appellate rights and therefore
be positive in that respect."
However, in his own filing to the trial court, Norvell
disputes that he or the arbitrator agreed that Parkhurst
should file her motion seeking a partial summary judgment in
the trial court:
"[Parkhurst] only filed her motion for partial
summary judgment in this court after filing the
almost identical motion with [the arbitrator] and
after [the arbitrator] stated that he would not
grant the motion but rather wanted to have a full
hearing. In that regard, [Norvell] has never agreed
for the circuit court to hear [Parkhurst's] motion
for
partial
summary
judgment.
After
[the
arbitrator] stated that he would not rule on the
motion because he wanted a full hearing due to the
lack of appeal rights in arbitration, [Parkhurst's]
counsel stated that he would file his motion in
circuit court from which [Norvell] would have an
appeal. However, counsel for [Norvell] made no
comment in response to that statement."
On December 21, 2016, Parkhurst filed a motion for a partial
summary judgment in the trial court, making the same arguments
she had made in her November 21 motion filed with the
arbitrator and further representing that "[Norvell] has taken
the position that the arbitrator does not have authority to
decide the issues presented in the plaintiff's motion for
partial summary judgment, but has instead asserted that those
issues should be presented to the circuit court."
11
1160696
On February 6, 2017, Norvell and the partnership moved
the trial court to stay or dismiss Parkhurst's motion for a
partial summary judgment because of the pending arbitration
proceeding, asserting that Parkhurst had filed her motion in
the trial court only because the arbitrator had effectively
rejected it by indicating that he wanted to hear the entire
case. On March 24, 2017, the trial court denied Norvell and
the partnership's motion and lifted the stay it had previously
entered in the case when arbitration was first ordered so that
it could consider Parkhurst's motion for a partial summary
judgment. On May 5, 2017, Norvell and the partnership filed
a notice of appeal to this Court.4
II.
Norvell and the partnership argue that the trial court's
March 24 order lifting the stay in this case is the equivalent
of an order refusing to compel arbitration that is appealable
pursuant to Rule 4(d), Ala. R. App. P. We agree. This Court
has held that a direct appeal is the proper vehicle by which
4Norvell and the partnership had previously filed a
petition for the writ of mandamus with this Court on April 17,
2017 (case no. 1160605). That petition was still pending when
they filed their notice of appeal but was ultimately denied
without an opinion on June 29, 2017.
12
1160696
to challenge a trial court's refusal to stay matters pending
arbitration, and we have stated that we will review such
decisions under a de novo standard of review. See Johnson v.
Jefferson Cty. Racing Ass'n, 1 So. 3d 960, 968 n. 10 (Ala.
2008), Liberty Nat'l Life Ins. Co. v. Douglas, 826 So. 2d 806,
809 (Ala. 2002) ("We review de novo a trial court's denial of
a motion to stay pending arbitration."), and Lee v. YES of
Russellville, Inc., 784 So. 2d 1022, 1025 (Ala. 2000) ("A
trial court's denial of a motion to stay proceedings pending
arbitration is reviewable by direct appeal. ... Our review of
that decision is de novo."). See also Bear Bros., Inc. v. ETC
Lake Dev., LLC, 121 So. 3d 334, 337 (Ala. 2013) (Moore, C.J.,
concurring specially) ("[T]his Court has considered a motion
to stay proceedings pending arbitration as implicitly
encompassed within the right of appeal provided in Rule
4(d)."). Accordingly, we review de novo the trial court's
March 24 order lifting the stay in this case.
III.
It
is
undisputed
that
an
arbitration
agreement
encompassing the underlying dispute between Norvell and the
partnership, on the one hand, and Parkhurst, on the other,
13
1160696
exists; both Norvell and Parkhurst acknowledge that fact.
Accordingly, the burden is upon Parkhurst –– the party seeking
to have some element of that dispute decided by the trial
court instead of the arbitrator –– to establish that the
arbitration agreement should not be enforced. See, e.g.,
Alabama Title Loans, Inc. v. White, 80 So. 3d 887, 891 (Ala.
2011) (generally explaining the shifting burdens that apply
when a party seeks to enforce –– or avoid –– an arbitration
agreement). Parkhurst has advanced several legal arguments
for removing her dispute with Norvell and the partnership from
arbitration
––
including
waiver,
default,
estoppel,
acquiescence, and the "mend-the-hold" doctrine;5 all these
arguments, however, are essentially based on the same
underlying argument that Norvell and the partnership, by
5The United States Court of Appeals for the Seventh
Circuit has explained the mend-the-hold doctrine as follows:
"Th[e] [mend-the-hold] doctrine, which takes its
name from a nineteenth-century wrestling phrase, is
less a set of rules than a flexible concept of
equity. It prevents one party to litigation,
especially in contract disputes, from trying to
change its position or theories at such a late stage
in the dispute as to cause unfair prejudice to the
opposing party."
Estate of Burfurd v. Accounting Practice Sales, Inc., 851 F.3d
641, 644 (7th Cir. 2017).
14
1160696
Norvell's actions, have lost the right to now enforce the
arbitration provision in the dissolution agreement. This is
essentially an argument that Norvell has waived his right to
arbitration. We have considered similar arguments on
multiple
occasions and repeatedly emphasized that such a waiver is not
easily established. In Zedot Construction, Inc. v. Red
Sullivan's Conditioned Air Services, Inc., 947 So. 2d 396, 399
(Ala. 2006), this Court explained:
"'In Moses H. Cone Memorial Hospital [v.
Mercury Construction Corp., 460 U.S. 1
(1983)], the United States Supreme Court
recognized
a
strong
federal
policy
favoring
arbitration:
"'"The [Federal] Arbitration Act
establishes that, as a matter of
federal
law,
any
doubts
concerning
the
scope
of
arbitrable
issues
should
be
resolved in favor of arbitration,
whether the problem at hand is
the construction of the contract
language itself or an allegation
of waiver, delay, or a like
defense to arbitrability."
"'460 U.S. at 24–25 (... footnote omitted).
In order to establish waiver, the party
opposing arbitration bears a heavy burden,
and waiver is not lightly to be inferred.
Thompson v. Skipper Real Estate Co., 729
So. 2d 287, 292 (Ala. 1999), and cases
cited therein.'
15
1160696
"Ocwen Loan Servicing, LLC v. Washington, 939 So. 2d
6, 14 (Ala. 2006). '[A] presumption exists against
a finding that a party has waived the right to
compel arbitration.' Conseco Fin. Corp.-Alabama v.
Salter, 846 So. 2d 1077, 1080 (Ala. 2002)."
See also Ocwen Loan Servicing, LLC v. Washington, 939 So. 2d
6, 18 (Ala. 2006) (See, J., concurring in part and dissenting
in part) ("'"[T]o make out a case of implied waiver of a legal
right, there must be a clear, unequivocal, and decisive act of
the party showing such a purpose."'" (quoting Bell v.
Birmingham Broad. Co., 266 Ala. 266, 269, 96 So. 2d 263, 265
(1957), quoting in turn 56 Am.Jur. Waiver § 17, p. 18)).
Parkhurst argues that Norvell and the partnership have
waived their right to enforce the arbitration agreement in
this case by taking the position that the arbitrator lacked
the authority to rule on the partial summary-judgment motion
filed by Parkhurst in the arbitral forum. By taking this
position, Parkhurst argues, Norvell clearly and unequivocally
demonstrated an intent for the trial court to decide the
issues raised in that motion. We disagree. The documentary
evidence in the record indicates that, after Parkhurst moved
the arbitrator to enter a partial summary judgment in her
favor, Norvell argued to the arbitrator that "neither the FAA
16
1160696
nor the executed [dissolution agreement] provide[d] the
arbitrator with authority to grant dispositive motions" and
instead urged the arbitrator to follow the course of action
set out in the arbitration provision –– review the records of
the business, make inquiry of the parties as to any
transactions that are disputed, conduct a hearing of the
matter with the parties in attendance (if necessary), and,
finally, issue a written report reconciling the capital
accounts. This is not evidence indicating that Norvell is
seeking to move the matter from the arbitral forum to a
judicial forum; rather, it indicates how Norvell desired the
arbitrator to conduct the arbitration proceedings. Although
Norvell surely does take the position that the arbitrator
lacks authority to consider dispositive motions, it does not
necessarily follow that Norvell is therefore arguing that the
trial court does have that authority. Instead, Norvell is
simply arguing that the arbitrator should proceed with its
review of the partnership's records and resolve the dispute
submitted to it without making intermediate judgments. 6
6We express no opinion on how the arbitrator in this case
ultimately chooses to structure the arbitration proceedings
before him; we note only that this Court has recognized an
arbitrator's
"discretion
in
structuring
arbitration
17
1160696
None of the documentary evidence in the record indicates
that Norvell clearly and unequivocally waived his right to
have this dispute with Parkhurst decided in arbitration. We
note, however, that Parkhurst has also argued that Norvell
expressly waived that right in a December conference call with
the arbitrator. Norvell, however, disputes this claim and
asserts that he never agreed that the trial court should
consider Parkhurst's partial summary-judgment motion. There
is no transcript of the conference call or any other evidence
of what transpired during that call in the record; instead, we
have before us only the unsupported assertions of counsel on
either side. Even if Norvell did not expressly refute
Parkhurst's recollection of the conference call, however,
unsupported assertions concerning the substance of that call
could not form the basis of a judgment on appeal affirming the
trial court's decision to lift the stay. As explained in
Davant v. United Land Corp., 896 So. 2d 475, 483 (Ala. 2004),
this is not because we doubt counsel's integrity or
credibility, but because, as an appellate court, we are
procedures." Birmingham News Co. v. Horn, 901 So 2d. 27, 54-
55 (Ala. 2004), overruled on other grounds by Hereford v. D.R.
Horton, Inc., 901 So. 2d 27 (Ala. 2004).
18
1160696
limited to the facts as established by the record. There is
no evidence in the record from which we can conclude that
Norvell clearly waived his right to proceed in arbitration;
accordingly, it was error for the trial court to lift the stay
for
the
purpose
of
considering
matters
the
parties
undisputedly agreed to arbitrate.
IV.
Pursuant to an arbitration provision in a dissolution
agreement entered into by her deceased husband Andrew,
Parkhurst initiated arbitration proceedings with Norvell and
the partnership to resolve a dispute regarding the
dissolution
of the partnership.
After Norvell opposed Parkhurst's attempt
to have the arbitrator enter an intermediary order limiting
the scope of his review of the partnership's business records,
Parkhurst filed a motion seeking the same relief in the trial
court, purportedly because Norvell and the arbitrator agreed
that she should do so. However, there is no evidence in the
record indicating that Norvell made such an agreement and he,
in fact, denies doing so. In the absence of any evidence that
would establish such an agreement, as well as any other
evidence that would conclusively establish that Norvell
19
1160696
clearly and unequivocally expressed an intent to waive his
right to have the arbitrator resolve this dispute, Parkhurst
has failed to meet her heavy burden of showing that the
arbitration provision in the dissolution agreement should not
be enforced. Accordingly, the trial court erred by lifting
the arbitral stay in order to consider Parkhurst's motion for
a partial summary judgment, and its judgment doing so is
hereby reversed and the cause remanded.
REVERSED AND REMANDED.
Bolin, Murdock, Main, and Bryan, JJ., concur.
20 | November 9, 2017 |
a7463d5c-6cd7-4c89-bb97-4c43d09310f7 | Locklear Automotive Group, Inc. v. Jeremy Averette | N/A | 1160336 | Alabama | Alabama Supreme Court | REL: 09/29/2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
SPECIAL TERM, 2017
____________________
1160335
____________________
Locklear Automotive Group, Inc.
v.
Brad Hubbard
Appeal from Tuscaloosa Circuit Court
(CV-16-900716)
____________________
1160336
____________________
Locklear Automotive Group, Inc.
v.
Jeremy Averette
Appeal from Tuscaloosa Circuit Court
(CV-16-900683)
____________________
1160337
____________________
Locklear Automotive Group, Inc.
v.
Carol Fuller
Appeal from Tuscaloosa Circuit Court
(CV-16-901091)
____________________
1160375
____________________
Locklear Chrysler Jeep Dodge, LLC, and
Locklear Automotive Group, Inc.
v.
Anthony Hood
Appeal from Bibb Circuit Court
(CV-16-900098)
____________________
1160435
____________________
Locklear Chrysler Jeep Dodge, LLC, and
Locklear Automotive Group, Inc.
v.
Jeffery Lollar and Betsy Lollar
Appeal from Bibb Circuit Court
(CV-16-900081)
____________________
1160436
____________________
Locklear Automotive Group, Inc.
v.
Elizabeth Montana Booth
Appeal from Bibb Circuit Court
(CV-16-900074)
____________________
1160437
____________________
Locklear Automotive Group, Inc.
v.
Dorothea Williams
Appeal from Bibb Circuit Court
(CV-16-900073)
MURDOCK, Justice.
Before us are appeals from denials of motions to compel
arbitration filed by Locklear Chrysler Jeep Dodge, LLC
("Locklear CJD"), and Locklear Automotive Group, Inc.
3
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
("Locklear Group"), in
actions filed by plaintiffs who alleged
that they were victims of identity theft resulting from
personal information they had provided Locklear CJD in order
to explore the possibility of financing the purchase of a
vehicle from Locklear CJD. In case no. 1160435, we affirm the
order of the trial court denying the motion to compel
arbitration; in the other appeals, we reverse the trial
court's orders and remand the causes.
I. Facts
All the plaintiffs in these cases purchased vehicles from
Locklear CJD. All the plaintiffs signed an arbitration
agreement as part of their vehicle purchases; the operative
language of those arbitration agreements is the same. And all
the plaintiffs alleged that they were the victims of identity
theft that resulted from providing personal information to
Locklear CJD when they filled out credit applications for the
vehicle purchases.
In addition to naming Locklear CJD as a defendant, the
plaintiffs' complaints named multiple other defendants who
they alleged played a part in the identity thefts. Among the
other defendants named is Locklear Group. According to an
4
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
affidavit from Christopher S.
Locklear, Sr., vice president of
Locklear CJD, Locklear Group "is the sole member of Locklear
Chrysler Jeep Dodge, LLC."
The arbitration agreement signed by each plaintiff is
titled "Binding Pre-Dispute Arbitration Agreement" ("the
arbitration agreement"), and its operative language is as
follows:
"In
connection
with
the
undersigned's
acquisition or attempted acquisition of the below
described vehicle, by lease, rental, purchase or
otherwise, the undersigned and the dealer whose name
appears below, stipulate and agree, in connection
with the resolution of any dispute arising out of,
or relating to, resulting from or concerning any
contracts or agreements, or agreements or contracts
to be entered into by the parties, all alleged
representations, promises and covenants, issues
concerning compliance with any state or federal law
or regulation, and all relationships resulting
therefrom, as follows: That the vehicle, services,
and products (hereinafter 'products') involved in
the
acquisition
or
attempted
acquisition
are
regulated by the laws of the United States of
America; and/or, that the contract(s) and agreements
entered into by the parties concerning said products
evidence transactions and business enterprises
substantially involving and affecting interstate
commerce sufficiently to invoke the application of
the Federal Arbitration Act, 9 U.S.C. § 1, et seq.
The undersigned agree that all disputes not barred
by applicable statutes of limitations, resulting
from, arising out of, relating to or concerning the
transaction entered into or sought to be entered
into (including but not limited to: any matters
5
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
taking place either before or after the parties
entered into this agreement, including any prior
agreements or negotiations between the parties; the
terms of this agreement and all clauses herein
contained, their breadth and scope, and any term of
any agreement contemporaneously entered into by the
parties; the past, present and future condition of
any products at issue; the conformity of the
products
to
any
contract
description;
the
representations, promises, undertakings, warranties
or covenants made by the dealer, its agents,
servants, employees, successors and assigns, or
otherwise dealing with the products; any lease, sale
or rental terms or the terms of credit and/or
financing in connection therewith; or compliance
with any state or federal laws; any terms or
provisions of any insurance sought to be purchased
or purchased simultaneously herewith; any terms or
provisions of any extended service contract sought
to
be
purchased
or
purchased
simultaneously
herewith) shall be submitted to BINDING ARBITRATION,
pursuant to the provisions of 9 U.S.C. § 1, et seq.
and according to the Commercial Dispute Resolution
procedures and/or consumer protocol (depending on
the
amount
in
controversy)
of
the
American
Arbitration Association (the AAA) then existing in
the county where the transaction was entered into or
sought to be entered into, except as follows:
(a) In all disputes in which the matter in
controversy (including compensatory and punitive
damages, fees and costs) is more than $10,000 but
less than $75,000.00, one arbitrator shall be
selected in accordance with the AAA's Consumer
Protocol. In all disputes in which the matter in
controversy (including compensatory and punitive
damages and fees and costs) is $75,000.00 or more,
the parties to this agreement shall select an
arbitrator under the AAA's Commercial Rules and
shall select one arbitrator from a list of at least
5 suitable arbitrators supplied by the AAA in
accordance with and utilizing the AAA strike method.
6
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
(b) An arbitrator so selected shall be empowered to
enter an award of such damages, fees and costs, and
grant such other relief, as is allowed by law. The
arbitrator has no authority or jurisdiction to enter
any
award
that
is
not
in
conformance
with
controlling law. Any party to this agreement who
fails or refuses to arbitrate in accordance with the
terms of this agreement may, in addition to any
other relief awarded, be taxed by the arbitrator
with the costs, including reasonable attorney's
fees, of any other party who had to resort to
judicial or other relief in compelling arbitration.
In the event the dealer and the undersigned
customer(s) have entered into more than one
arbitration agreement concerning any of the matters
identified herein, the undersigned customers and the
dealer agree that the terms of this arbitration
agreement shall control disputes between and among
them. Any provision in this Agreement found to be
in conflict with any procedure promulgated by the
AAA which shall affect its administration of
disputes hereunder, shall be considered severed
herefrom. With respect to the process of arbitration
under the AAA Commercial Rules or Consumer Protocol,
the undersigned customer(s) and the dealer expressly
recognize that the rules and protocol and the terms
of this agreement adequately protect their abilities
to fully and reasonably pursue their respective
statutory and other legal rights. If for any reason
the AAA fails or refuses to administer the
arbitration of any dispute brought by any party to
this agreement, the parties agree that all disputes
will then be submitted to binding arbitration before
the Better Business Bureau (the BBB) serving the
community where the Dealer conducts business, under
the BBB binding arbitration rules. ... This
agreement
shall
survive
any
termination,
cancellation,
fulfillment,
including,
but
not
limited to cancellation due to lack of acceptable
financing or funding of any retail installment
contract
or
lease.
Further
information
about
7
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
arbitration can be obtained directly from the AAA or
from a review of AAA's Commercial Dispute Resolution
Procedures and Consumer Protocol, and/or the BBB's
Binding Arbitration Rules, copies of which are
available without charge for review from the AAA and
the BBB. THE UNDERSIGNED HAVE AGREED TO WAIVE THE
UNDERSIGNED(S)' RIGHT TO A TRIAL BY JUDGE OR JURY IN
ALL DISPUTES OVER $10,000.00 AND THAT ARBITRATION
SHALL BE IN LIEU OF ANY CIVIL LITIGATION IN ANY
COURT AND IN LIEU OF ANY TRIAL BY JUDGE OR JURY FOR
ALL CLAIMS OVER $10,000.00. THE TERMS OF THIS
AGREEMENT AFFECT LEGAL RIGHTS. IF YOU DO NOT
UNDERSTAND ANY PROVISION OF THIS AGREEMENT OR THE
COSTS, ADVANTAGES OR DISADVANTAGES OF ARBITRATION,
SEEK INDEPENDENT ADVICE AND/OR REVIEW THE WRITTEN
CONSUMER
AND/OR
COMMERCIAL
DISPUTE
RESOLUTION
PROCEDURES AND PROTOCOLS AND/OR CONTACT THE AAA OR
BBB BEFORE SIGNING. BY SIGNING YOU ACKNOWLEDGE THAT
YOU HAVE READ, UNDERSTAND AND AGREE TO BE BOUND BY
EACH OF THE PROVISIONS, COVENANTS, STIPULATIONS AND
AGREEMENTS SET FORTH AND REFERENCED HEREIN ABOVE.
"DESCRIPTION
OF
PRODUCTS/SERVICES:
_______________"
(Capitalization in original; emphasis omitted; and emphasis
added.)
In the blank line following the "DESCRIPTION OF
PRODUCTS/SERVICES" typically was printed the year and
model of
the vehicle to be purchased, as well as the vehicle-
identification number ("VIN") of that vehicle. Below that
were blank lines for the date to be filled in and lines for
signatures of the customer and a dealer representative. In
two of the cases before us -- the complaints filed by
8
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
Jeffery Lollar and Betsy Lollar and by Anthony Hood -- there
are allegations that the arbitration agreements were altered
after the Lollars and Hood signed their agreements,
allegations that will be explained in more detail when we
discuss the facts of each case.
A. Case no. 1160435: Jeffery Lollar and Betsy Lollar
Jeffery Lollar and Betsy Lollar originally visited
Locklear CJD on May 28, 2013, and purchased a 2009 Dodge Ram
truck. In the course of doing so, they signed the arbitration
agreement. The Lollars again visited Locklear CJD in
December
2015
because
they
were
considering
purchasing
another
vehicle. In the course of exploring that option, they filled
out a credit application to see if they would qualify for a
loan. The Lollars ultimately decided to purchase a vehicle
from another dealership and, thus, did not sign an arbitration
agreement in connection with their 2015 visit to Locklear CJD.
Sometime after their 2015 visit to Locklear CJD, the
Lollars were informed by the Northport Police Department that
they had been the victims of identity theft. The Lollars
allege that Locklear CJD and Locklear Group, by and through
their employees, had represented to them when they provided
9
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
their personal information that their information would be
kept confidential. Instead, according to the Lollars,
Locklear
CJD
and
Locklear
Group
wrongfully
procured,
disclosed, disseminated, used, provided, and/or sold the
Lollars' personal information.
The Lollars filed a complaint in the Bibb Circuit Court
on October 7, 2016, against Locklear CJD, Locklear Group, and
other defendants.1 They asserted the following claims against
Locklear
CJD
and
Locklear
Group:
(1)
negligence;
(2) wantonness; (3) invasion of privacy; (4) conversion;
(5)
fraud-deceit,
suppression,
and
misrepresentation;
(6)
tort
of outrage; (7) civil conspiracy; (8) violation of Alabama's
Consumer Identity Protection Act; (9) "respondeat superior";
and (10) breach of fiduciary duty.
On October 28, 2016, Locklear CJD and Locklear Group
filed a joint motion to compel arbitration of all the Lollars'
claims against them. In support of the motion, they submitted
an affidavit from Christopher S. Locklear, Sr., who stated
1The other defendants were Verizon Communications, Inc.,
CellCo Partnership d/b/a Verizon Wireless, Verizon Credit,
Inc.,
Wireless
Advantage
Communications,
Inc.,
and
fictitiously named defendants A through H.
10
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
that he was the custodian of records at Locklear CJD and that
a copy of the arbitration agreement signed by the Lollars in
2013 was attached to his affidavit. The copy of the
arbitration agreement submitted with the motion to compel
arbitration contained the signatures of Jeffery Lollar and
Betsy Lollar, a signature of a dealer representative, the date
of the 2013 transaction, and in the space for "Description of
Products/Services" was printed "2009 RAM 1500" with an
accompanying VIN, followed by "LOCKLEAR CHRYSLER JEEP DODGE,
LLC." Locklear CJD and Locklear Group filed an amended motion
to compel on February 1, 2017.
On February 8, 2017, without the benefit of a response
from the Lollars or a hearing, the trial court entered an
order denying the motion to compel arbitration. The order did
not state a rationale for the decision. Locklear CJD and
Locklear Group filed a timely appeal of the trial court's
order denying their motion to compel arbitration.
B. Case no. 1160375: Anthony Hood
In November 2015, Anthony Hood visited Locklear CJD to
look at vehicles. On December 19, 2015, Hood purchased a 2016
11
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
Dodge Ram 3500 truck2 from Locklear CJD, and, in the course of
doing so, he signed the arbitration agreement. At that time,
Hood also completed a
credit application and provided Locklear
CJD with personal information. Like the Lollars, Hood alleged
that Locklear CJD represented to him that his information
would be kept confidential. In March 2016, Hood was informed
by the Northport Police Department that he was the victim of
identity theft.
On December 5, 2016, Hood filed his complaint in the Bibb
Circuit Court against Locklear CJD, Locklear Group, and other
defendants.3 He asserted the following claims against
Locklear
CJD
and
Locklear
Group:
(1)
negligence;
(2) wantonness; (3) invasion of privacy; (4) conversion;
(5)
fraud-deceit,
suppression,
and
misrepresentation;
(6)
tort
of outrage; (7) civil conspiracy; (8) violation of Alabama's
Consumer Identity Protection Act; (9) "respondeat superior";
2There is an immaterial discrepancy between Hood's
complaint and the arbitration agreement on the year of the
purchased vehicle, i.e., whether it was a 2015 or 2016 model.
3The other defendants were Verizon Communications, Inc.,
CellCo Partnership d/b/a Verizon Wireless, Verizon Credit,
Inc.,
Wireless
Advantage
Communications,
Inc.,
and
fictitiously named defendants A through H.
12
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
and (10) breach of fiduciary duty. In his complaint, Hood
recounted that he "purchase[d] a 2016 3500 Dodge Ram" truck
from Locklear CJD and that, in the course of doing so, he
"completed a credit or financial application" provided by
"Locklear Dodge personnel." Hood filed a first amended
complaint on December 12, 2016, to correct his legal name in
the party references.
Locklear CJD and Locklear Group filed a joint motion to
compel arbitration on December 12, 2016. In support of the
motion, they submitted an affidavit from Christopher S.
Locklear, Sr., who stated that he was the custodian of records
at Locklear CJD and that a copy of the arbitration agreement
signed by Hood was attached to his affidavit. The copy of the
arbitration agreement submitted with the motion to compel
arbitration contained Hood's signature on a line designated
"CUSTOMER," a signature of a dealer representative on a line
designated "DEALER," and the date of the transaction. In the
space
for
"Description
of
Products/Services" was
printed
"2015
RAM 3500" and a VIN. Immediately above the "DEALER" signature
line was typed or printed "LOCKLEAR CHRYSLER JEEP DODGE, LLC."
13
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
On January 18, 2017, Hood filed a response in opposition
to the motion to compel arbitration. Hood's response again
stated that, "[a]round November 2015, [Hood] purchased a 3500
Dodge Ram at Locklear Chrysler Jeep Dodge, LLC," and that he
"signed a Pre-Dispute Arbitration Agreement pertaining to the
vehicle." In support of his response, Hood filed his own
affidavit in which he testified:
"3. I did not sign the Arbitration Agreement
attached to Locklear Defendants' Motion to Stay.
"4. The words 'Locklear Chrysler Jeep Dodge, LLC'
at the bottom of the agreement are different typeset
than the rest of the agreement and not part of an
original document.
"5. A copy of the only agreement presented and
given to me is attached to this Affidavit. Someone
altered the original to add the words 'Locklear
Chrysler Jeep Dodge, LLC' after the fact and filed
the altered agreement in Court with the Locklear
Defendants' Motion."
The version of the arbitration agreement Hood attached to
his affidavit is a "blank form" of the agreement in that it
contains no signatures, no date, and no description of the
purchased vehicle. At the bottom, however, it does contain
signature lines designated for the "DEALER" and for the
"CUSTOMER." It comports with the foregoing averments in that
14
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
it does not bear the typed or printed words "LOCKLEAR CHRYSLER
JEEP DODGE, LLC."
On the other hand, a version of the arbitration agreement
Hood attached as an exhibit to his appellate brief and
represented by Hood in his brief to be a copy of the actual
agreement is signed. It bears Hood's signature as "CUSTOMER,"
the signature of a representative of the "DEALER," the date of
the transaction, and the make, model, and VIN of the subject
vehicle. This version likewise comports with the averments
above, i.e, it does not contain the typed or printed words
"LOCKLEAR CHRYSLER JEEP DODGE, LLC."
On January 23, 2017, the trial court heard oral arguments
on the motion to compel arbitration and, on the same date,
entered an order denying the motion. The order did not state
a rationale for the decision, except to note that the
"[f]indings [are] made orally in the record." The order was
issued by the same circuit judge who entered the order in the
Lollars' case. In the hearing on the motion to compel
arbitration, the trial court explained its decision as
follows:
15
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
"THE COURT: Okay. Well, I got it. Well, what I'm
kind of stuck on is the nexus of the actions to the
thing. And, of course, even listening to all that,
it seems like to me, the nexus is not there for --
because this is a -- looks like a totally separate
and independent matter. And, of course, the
question does, though, become and it's going to be
another question and, maybe, to deal with on a
motion -- on a summary judgment issue later on is
whether or not the dealership should be held
responsible for somebody else's independent criminal
actions, that's a whole other issue. But I'm going
to deny the motion for arbitration because seems
like that's a totally separate issue. It really is
in my opinion. And so -- and, of course, if my
bosses see otherwise. I'll go along with whatever
they say. But I really think that it's a separate
issue. Of course -- but the meat gets down to
whether or not the dealership is going to be liable.
I have to see whether there's enough evidence to
connect that to it. Now I don't know. But that's
something right now. But let's look at this -- I'm
going to deny the motion to arbitrate."
Locklear CJD and Locklear Group filed a timely appeal of
the trial court's order from the denial of their motion to
compel arbitration.
C. Case no. 1160335: Brad Hubbard
On November 18, 2015, Brad Hubbard visited Locklear CJD
and purchased a 2015 Jeep Grand Cherokee sport-utility
vehicle. In the course of doing so, he signed the arbitration
agreement. At that time, Hubbard also completed a credit
application
and
provided
Locklear
CJD
with
personal
16
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
information. In early 2016, Hubbard discovered that he was
the victim of identity theft.
On July 1, 2016, Hubbard filed a complaint in the
Tuscaloosa Circuit Court against Locklear CJD. Locklear CJD
filed a motion to compel arbitration on August 9, 2016. On
August 11, 2016, the trial court entered an order granting
Locklear CJD's motion. The following day Hubbard filed a
motion to set aside the order, but on August 29, 2016, he
withdrew his motion.
On August 22, 2016, Hubbard filed his first amended
complaint in which he added additional defendants, namely
Allen Bentley, Wireless Advantage Communications, Inc.,
Verizon Communications, Inc., and Verizon Credit, Inc., as
well as asserted additional claims. On October 12, 2016,
Hubbard filed a second amended complaint in which he added
Locklear Group as a defendant and asserted additional claims
against the defendants. The second amended complaint asserted
the following claims against all the named defendants,
including Locklear CJD and Locklear Group: (1) negligence;
(2) wantonness; (3) violation of Alabama's Consumer Identity
Protection Act; (4) conversion; (5) invasion of privacy; (6)
17
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
tort of outrage; (7) civil conspiracy; and (8) negligent
and/or
wanton
hiring,
retention,
supervision,
and/or
training.
Locklear Group filed a motion to compel arbitration on
October 13, 2016. On October 18, 2016, the trial court set
the motion for a hearing date of October 28, 2016. On
October 27, 2016, Hubbard filed a response in opposition to
the motion to compel arbitration. In his response, Hubbard
contended that Locklear Group could not enforce the
arbitration agreement because it was not a signatory to the
agreement and the language of the agreement was limited to the
signing parties -- Locklear CJD and Hubbard. Hubbard did not
oppose arbitration of his claims against Locklear CJD.
On December 27, 2016, the trial court entered an order
denying Locklear Group's motion to compel arbitration. In its
order, the trial court quoted a portion of the arbitration
agreement and then stated:
"This arbitration provision is broad in the
sense that it applies to 'any dispute' arising from
or related to 'any contracts or agreements.'
However, it is narrow in the sense that it applies
only to 'the undersigned and the dealer' or to
contracts entered into 'by the parties.' The
provision does not define 'dealer' or 'parties' in
such a way that would include Locklear [Group]. See
18
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
MTA, Inc. v. Merrill, Lynch, Pierce, Fenner, 114
So. 3d 27 (Ala. 2012).
"Accordingly, Locklear ... Group's Motion to
Stay and Compel Arbitration is due to be and hereby
is DENIED."
(Capitalization in original.)
Locklear Group filed a timely notice of appeal from the
trial court's order denying its motion to compel arbitration.4
D. Case no. 1160336: Jeremy Averette
On October 29, 2015, Jeremy Averette visited Locklear CJD
and purchased a 2016 Dodge Ram truck. In the course of doing
so, he signed the arbitration agreement. At that time,
Averette also completed a credit application and provided
Locklear CJD with personal information. On February 18, 2016,
Averette was notified by the Northport Police Department that
he was the victim of identity theft.
On June 27, 2016, Averette filed a complaint in the
Tuscaloosa Circuit Court against Locklear CJD. Locklear CJD
filed a motion to compel arbitration on August 9, 2016. On
4On February 8, 2017, this Court by order consolidated
this appeal with case no. 1160336 and case no. 1160337 for
purposes of filing the record and briefing.
19
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
August 29, 2016, the trial court entered an order granting
Locklear CJD's motion to compel arbitration.
On August 22, 2016, Averette filed his first amended
complaint in which he added additional defendants, namely
Allen Bentley, Wireless Advantage Communications, Inc.,
Verizon Communications, Inc., and Verizon Credit, Inc., as
well as asserted additional claims. On October 12, 2016,
Averette filed a second amended complaint in which he added
Locklear Group as a defendant and asserted additional claims
against the named defendants. The second amended complaint
asserted the following claims against all the named
defendants, including Locklear CJD and Locklear Group:
(1) negligence; (2) wantonness; (3) violation of Alabama's
Consumer
Identity
Protection Act;
(4)
conversion;
(5)
invasion
of privacy; (6) tort of outrage; (7) civil conspiracy; and
(8) negligent and/or wanton hiring, retention, supervision,
and/or training.
Locklear Group filed a motion to compel arbitration on
October 13, 2016. On October 17, 2016, the trial court set
the motion for a hearing date of October 19, 2016. On
October 18, 2016, Averette filed a response in opposition to
20
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
the motion to compel. In his response, Averette, like
Hubbard, contended that Locklear Group could not enforce the
arbitration agreement because it was not a signatory to the
agreement and the language of the agreement was limited to the
signing parties -- Locklear CJD and Averette. Averette did
not oppose arbitration of his claims against Locklear CJD.
On December 27, 2016, the trial court entered an order
denying Locklear Group's motion to compel arbitration. The
substantive language of the order, except for the name of the
plaintiff, was exactly the same as the order in Hubbard's
case, and it was issued by the same circuit judge.
Locklear Group filed a timely notice of appeal from the
trial court's order denying its motion to compel arbitration.
E. Case no. 1160337: Carol Fuller
On November 21, 2015, Carol Fuller visited Locklear CJD
and purchased a 2008 Toyota Avalon automobile. In the course
of doing so, she signed the arbitration agreement. At that
time, Fuller also completed a credit application and provided
Locklear CJD with personal information. In February 2016,
Fuller was notified by the Northport Police Department that
she was the victim of identity theft.
21
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
On October 7, 2016, Fuller filed a complaint in the
Tuscaloosa
Circuit
Court
against
Locklear
CJD,
Locklear
Group,
and other defendants, asserting the following claims:
(1) negligence; (2) wantonness; (3) violation of Alabama's
Consumer
Identity
Protection Act;
(4)
conversion;
(5)
invasion
of privacy; (6) tort of outrage; (7) civil conspiracy; and
(8) negligent and/or wanton hiring, retention, supervision,
and/or training.
On October 11, 2016, Locklear CJD and Locklear Group
filed a joint motion to compel arbitration. On October 26,
2016, the trial court set the motion for a hearing date of
October 28, 2016. On October 27, 2016, Fuller filed a
response in opposition to the motion to compel. In her
response, Fuller -- as did Averette and Hubbard -- contended
that Locklear Group could not enforce the arbitration
agreement because it was not a signatory to the agreement and
the language of the agreement was limited to the signing
parties -- Locklear CJD and Fuller. Fuller did not oppose
arbitration of her claims against Locklear CJD.
On December 27, 2016, the trial court entered an order
granting the motion to compel as to Locklear CJD but denying
22
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
it as to Locklear Group. Except for the name of the plaintiff
and references to Locklear CJD's motion to compel, the order
was substantively the same as the orders entered in Hubbard's
and Averette's cases, and it was issued by the same circuit
judge.
Locklear Group filed a timely notice of appeal from the
trial court's order denying the motion to compel arbitration
as to it.
F. Case no. 1160436: Elizabeth Booth
On December 7, 2015, Elizabeth Booth visited Locklear CJD
and purchased a 2015 Jeep Grand Cherokee sport-utility
vehicle. In the course of doing so, she signed the
arbitration agreement. At that time, Booth also completed a
credit application and provided Locklear CJD with personal
information. In January 2016, Booth was notified by the
Northport Police Department that she was the victim of
identity theft.
On October 7, 2016, Booth filed a complaint in the Bibb
Circuit Court against Locklear CJD, Locklear Group, and other
defendants, asserting the following claims: (1) negligence;
(2) wantonness; (3) violation of Alabama's Consumer Identity
23
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
Protection Act; (4) conversion; (5) invasion of privacy;
(6) tort of outrage; (7) civil conspiracy; and (8) negligent
and/or
wanton
hiring,
retention,
supervision,
and/or
training.
Locklear Group and Locklear CJD filed their joint motion
to compel arbitration on October 11, 2016. On November 9,
2016, Booth filed a response in opposition to the motion to
compel. In her response, Booth -- as did Fuller, Averette, and
Hubbard -- contended that Locklear Group could not enforce the
arbitration agreement because it was not a signatory to the
agreement and the language of the agreement was limited to the
signing parties -- Locklear CJD and Booth. Booth did not
oppose arbitration of her claims against Locklear CJD.
On January 31, 2017, the trial court held a hearing on
the motion to compel arbitration. On February 1, 2017, the
trial court denied the motion to compel as to Locklear Group,
but it granted the motion as to Locklear CJD. Except for the
name of the plaintiff, the order was substantively the same as
the order entered in Fuller's case, but it was issued by a
different circuit judge.
24
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
Locklear Group filed a timely notice of appeal from the
trial court's order denying the motion to compel arbitration
as to it.
G. Case no. 1160437: Dorothea Williams
On January 13, 2016, Dorothea Williams purchased a 2016
Chrysler 200 automobile from Locklear CJD. In the course of
doing so, she signed the arbitration agreement. At that time,
Williams also completed a credit application and provided
Locklear CJD with personal information. In February 2016,
Williams was notified by the Northport Police Department that
she had been the victim of identity theft.
On October 6, 2016, Williams filed her complaint in the
Bibb Circuit Court against Locklear CJD, Locklear Group, and
other
defendants,
asserting
the
following
claims:
(1) negligence; (2) wantonness; (3) violation of Alabama's
Consumer
Identity
Protection
Act;
(4)
conversion; (5)
invasion
of privacy; (6) tort of outrage; (7) civil conspiracy; and
(8) negligent and/or wanton hiring, retention, supervision,
and/or training.
Locklear Group and Locklear CJD filed their joint motion
to compel arbitration on October 11, 2016. On November 9,
25
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
2016, Williams filed a response in opposition to the motion to
compel. On January 23, 2017, Williams filed a supplemental
response to the motion. In her response, Williams -- as did
Hubbard, Averette, Fuller, and Booth -- contended that
Locklear Group could not enforce the arbitration agreement
because it was not a signatory to the agreement and the
language of the agreement was limited to the signing parties
-- Locklear CJD and Williams. Williams did not oppose
arbitration of her claims against Locklear CJD.
On January 31, 2017, the trial court held a hearing on
the motion. On February 1, 2017, the trial court granted the
motion to compel as to Locklear CJD but denied it as to
Locklear Group. Except for the name of the plaintiff, the
order was substantively the same as the orders entered in the
Fuller and Booth cases. It was issued by the same circuit
judge who decided Booth's case. Locklear Group filed a timely
notice of appeal from the trial court's order denying the
motion to compel arbitration as to it.
II. Standard of Review
"Our standard of review of a ruling denying a
motion to compel arbitration is well settled:
26
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
"'"This Court reviews de
novo the denial of a motion to
compel
arbitration.
Parkway
Dodge, Inc. v. Yarbrough, 779
So. 2d 1205 (Ala. 2000). A
motion to compel arbitration is
analogous to a motion for a
summary judgment. TranSouth Fin.
Corp. v. Bell, 739 So. 2d 1110,
1114 (Ala. 1999). The party
seeking to compel arbitration has
the
burden
of
proving
the
existence of a contract calling
for arbitration and proving that
the
contract
evidences
a
transaction affecting interstate
commerce. Id. '[A]fter a motion
to compel arbitration has been
made and supported, the burden is
on
the nonmovant
to
present
evidence
that
the
supposed
arbitration
agreement
is
not
valid or does not apply to the
dispute in question.' Jim Burke
Automotive, Inc. v. Beavers, 674
So. 2d 1260, 1265 n.1 (Ala. 1995)
(opinion
on
application
for
rehearing)."'
"Elizabeth Homes, L.L.C. v. Gantt, 882 So. 2d 313,
315 (Ala. 2003) (quoting Fleetwood Enters., Inc. v.
Bruno, 784 So. 2d 277, 280 (Ala. 2000))."
SSC Montgomery Cedar Crest Operating Co. v. Bolding, 130
So. 3d 1194, 1196 (Ala. 2013).
27
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
III. Analysis
A. Case no. 1160335: Brad Hubbard; case no. 1160336: Jeremy
Averette; case no. 1160337: Carol Fuller; case no. 1160436:
Elizabeth Booth; and case no. 1160437: Dorothea Williams
The arguments by the parties in the Hubbard, Averette,
Fuller, Booth, and Williams cases are identical,5 and so we
will address them together. As we observed in the rendition
of the facts, the trial courts in those cases determined that
the arbitration agreement "is broad in the sense that it
applies to 'any dispute' arising from or related to 'any
contracts or agreements.' However, it is narrow in the sense
that it applies only to 'the undersigned and the dealer' or to
contracts entered into 'by the parties.'" It was on this
premise that the trial courts concluded that the plaintiffs'
claims against Locklear CJD must be arbitrated but that their
claims against Locklear Group were not subject to arbitration
because Locklear Group was not a signatory to the arbitration
agreement. None of the plaintiffs in this group of appeals
objected to arbitration of their claims against Locklear CJD.
5Hubbard, Averette, Fuller, Booth, and Williams are all
represented by the same attorneys, and the argument sections
of their appellee briefs are substantively very similar.
28
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
1. Who Decides the Arbitrability of the Claims
Against Locklear Group?
We
have
stated
that
"[t]he
question
whether
an
arbitration provision may be used to compel arbitration of a
dispute between a nonsignatory and a signatory is a question
of substantive arbitrability (or, under the Supreme Court's
terminology,
simply
'arbitrability')."
Anderton
v.
Practice-Monroeville, P.C., 164 So.
3d
1094, 1101 (Ala. 2014).
"A
court
decides
issues
of
substantive
arbitrability
'[u]nless
the parties clearly and
unmistakably provide otherwise.'" Id.
(quoting AT&T Techs., Inc. v. Communications Workers of
America, 475 U.S. 643, 649 (1986)).
On appeal, Locklear Group contends that clear and
unmistakable evidence that the parties intended to arbitrate
issues of arbitrability exists in the arbitration agreement.
Specifically, it cites the following language in the
arbitration agreement:
"The undersigned agree that all disputes ...
resulting from, arising out of, relating to or
concerning the transaction entered into or sought to
be entered into (including but not limited to: ...
the terms of this agreement and all clauses herein
contained, their breadth and scope, ... shall be
submitted to BINDING ARBITRATION ...."
29
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
(Capitalization in original; emphasis added.)
In support of this contention, Locklear Group observes
that in Jim Burke Automotive, Inc. v. McGrue, 826 So. 2d 122
(Ala. 2002), this Court evaluated an arbitration agreement
that contained identical language as to arbitrability.
Specifically,
"[t]he
single-page
arbitration
agreement
provide[d] that the arbitrator decides 'the terms of this
agreement and all clauses herein contained, their breadth and
scope.'" 826 So. 2d at 132. The McGrue Court concluded that
"[t]he language of the arbitration agreement is clear and
unmistakable evidence indicating that McGrue and Jim Burke
intended to arbitrate the question of arbitrability." Id.
Likewise, in Ex parte Waites, 736 So. 2d 550 (Ala. 1999),
the
Court examined an arbitration agreement that contained the
same language on arbitrability:
"The arbitration provision included in the contract
entered into by the parties states that the parties
agree to arbitrate any disputes 'resulting from or
arising out of the sale transaction entered into
(including but not limited to: the terms of this
agreement and all clauses herein contained, their
breadth and scope ....'"
736 So. 2d at 552. The Waites Court concluded that "[t]his
language expresses a clear intent to submit to arbitration the
30
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
issue of arbitrability." Id. See also Title Max of
Birmingham, Inc. v. Edwards, 973 So. 2d 1050, 1054–55 (Ala.
2007) (concluding that an arbitration agreement that provided
that the parties agreed to arbitrate "'all claims, disputes,
or controversies arising from or relating directly or
indirectly to the signing of this Arbitration Provision, [and]
the validity and scope of this Arbitration Provision'"
"demonstrates that the parties intended to arbitrate whether
the agreement applies to 'any disputes that arose from their
relationship'").
For their part, the plaintiffs in these five appeals do
not directly challenge the Locklear Group's position that
language in the arbitration agreement sufficiently expresses
an intention to arbitrate issues of arbitrability. Instead,
they argue that Locklear Group did not sufficiently assert
this position in the trial courts and that, therefore, it
cannot serve as a basis for reversing the trial courts'
orders. The plaintiffs observe that all of Locklear Group's
motions to compel arbitration (which are substantially
identical in all the cases before us)
31
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
"consisted of six pages and fourteen numbered
paragraphs. The motions contained only one sentence
on the topic of who should decide disputes
concerning the scope of the arbitration agreements.
Specifically, the last sentence of paragraph 10 of
the motions states[:] 'Additionally, the scope and
breadth of this arbitration agreement is, by its
terms, to be determined by the arbitrator.' This
sentence was not followed by a citation to any legal
authority."
The plaintiffs in these five appeals note that "[t]his
Court has long held that it 'will not hold a trial court to be
in error unless that court has been apprised of its alleged
error and has been given the opportunity to act thereon.'"
Moultrie v. Wall, 172 So. 3d 828, 840 (Ala. 2015) (quoting Sea
Calm Shipping Co. v. Cooks, 565 So. 2d 212, 216 (Ala. 1990)).
They argue that the solitary sentence in the motions to compel
was not sufficient to apprise the trial courts that
arbitrability issues
--
including
Locklear
Group's
ability,
as
a nonsignatory, to enforce the arbitration agreement -- had to
be decided by the arbitrator. The plaintiffs contend that the
sentence is a quintessential example of an "undelineated
general
proposition[]
not
supported by
sufficient authority
or
argument." White Sands Grp., LLC v. PRS II, LLC, 998 So. 2d
1042, 1058 (Ala. 2008). The plaintiffs cite multiple cases in
32
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
which this Court concluded that a solitary reference to an
argument in a motion before the trial court was not sufficient
to raise the issue sought to be raised on appeal. See, e.g.,
Knight v. Alabama Power Co., 580 So. 2d 576, 578 (Ala. 1991)
(noting that "except for the one sentence requesting the trial
court to adopt the doctrine of comparative negligence, Knight
presented nothing in the way of argument on that issue. ...
This issue was not sufficiently argued to the trial court
...."); TFT, Inc. v. Warning Sys., Inc., 751 So. 2d 1238, 1243
(Ala. 1999), overruled on other grounds by Holiday Isle, LLC
v. Adkins, 12 So. 3d 1173 (Ala. 2008) (holding that an
unsuccessful bidder for a public contract could not argue on
appeal that the invitation to bid was ambiguous because it
"did not raise this argument in the trial court" where "[t]he
only mention of ambiguity TFT made at trial came in one
sentence of TFT's trial brief"); and Birmingham Hockey Club,
Inc. v. National Council on Compensation Ins., Inc., 827
So. 2d 73, 81 (Ala. 2002) (observing that the plaintiff's only
argument regarding the applicability of a six-year statute of
limitations was one sentence in a three-page motion and
concluding that "[i]t can hardly be said that [the plaintiff]
33
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
has presented this argument to the trial court and opposing
parties so as to give them an opportunity to address this
issue").
In the Booth and Williams appeals, Locklear Group
responds that, in addition to the sentence in its motion to
compel arbitration, it also raised the issue of arbitrability
in the hearings on those motions.6 Booth and Williams have
filed motions to strike Locklear Group's references and
arguments to statements it might have made in the hearings in
the Booth and Williams cases, observing that no transcript of
those hearings was made and so there is no evidence in the
record concerning what was argued in those hearings. Booth
and Williams further observe that Locklear Group could have
submitted a statement under Rule 10(d), Ala. R. App. P.,
recounting its recollection of what was argued in the hearings
if it had wanted those statements to be included as evidence
before this Court, but it failed to do so.7 Finally, Booth
6Locklear Group does not argue that it presented the
arbitrability argument in the hearings in the Hubbard,
Averette, and Fuller cases.
7Rule 10(d), Ala. R. App. P., states, in part: "If no
report of the evidence or proceedings at a hearing or trial
was made, or if a transcript is unavailable, the appellant may
34
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
and Williams cite multiple cases in which this Court has
refused to allow a party unilaterally to alter or supplement
the record through statements in an appellate brief. See,
e.g., Jim Parker Bldg. Co. v. G & S Glass & Supply Co., 69 So.
3d 124, 134 (Ala. 2011) (noting that "because the hearing in
this case was not transcribed, nothing presented at that
hearing may form the basis for reversing the trial court's
denial of Parker's motion to compel arbitration"); Bechtel v.
Crown Cent. Petroleum Corp., 451 So. 2d 793, 795 (Ala. 1984)
(observing that the appellant "states that estoppel was
raised
in oral argument at the hearing on the motion for summary
judgment. However, no transcription of that hearing is
included in the record. This court is limited to a review of
the record alone and the record cannot be changed, altered, or
varied on appeal by statements in briefs of counsel.").
In its responses to the motions to strike, Locklear Group
admits that "there is no record of the oral argument," that
"no steps were taken to create a statement of what occurred at
the hearing[s]," and that Booth and Williams "correctly
prepare a statement of the evidence or proceedings from the
best
available
means,
including
the
appellant's
recollection."
35
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
present[] the case law on this issue." Accordingly, we grant
the
motions to strike Locklear Group's references to
arguments
it allegedly made in the hearings on its motions to compel
arbitration in the Booth case and the Williams case. Thus, as
in the Hubbard, Averette, and Fuller cases, the only reference
to arbitrability in the trial courts in the Booth and Williams
cases was the single statement in Locklear Group's motion to
compel arbitration.
We agree with the plaintiffs that Locklear Group's
solitary statement in its motion to compel arbitration that
the arbitrator should decide the arbitrability of the claims
against it was not sufficient to apprise the trial court that
Locklear Group was relying on that argument. The first three
numbered paragraphs in the motion set out facts relevant to
the issue of arbitration, including quotations of substantial
portions of the arbitration agreement. The next three
paragraphs argued that the transaction at issue affected
interstate commerce. The following four paragraphs --
including paragraph 10, which contains the one sentence
referencing arbitrability of the arbitration issue -- argued
that the language of the arbitration agreement was broad
36
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
enough to include the subject matter of the underlying claims
asserted by the plaintiffs. Paragraph 10 stated:
"Arbitration
contracts
cannot
be
singled
out
and
be subjected to any different or more stringent
rules
of
construction
than
other
contracts.
Doctor's Associates, Inc. v. Casarotto, 517 U.S. 681
(1996). As plainly demonstrated by its language,
the
arbitration
agreement
in
this
case
is
sufficiently broad in scope to require arbitration
of all disputes relating to:
"'the resolution of any dispute arising out
of,
relating
to,
resulting
from
or
concerning any contracts or agreements ...
entered into by the parties, all alleged
representation, promises and covenants,
issues
concerning
compliance
with
any
state
or federal law or regulation ...[,] any
matters taking place either before or after
the parties entered into this agreement
...[,] the terms of this agreement and all
clauses
herein
contained,
their
breadth
and
scope ...'
"(Exhibit A). The present case clearly arises out
of and relates to the Plaintiff's purchase of the
[vehicle] at issue, events taking place before and
after the parties entered into the agreement, the
dealership's compliance with state and/or federal
law or regulations and alleged misrepresentations
and/or
omissions
of
Locklear
in
connection
therewith. Additionally, the scope and breadth of
this arbitration agreement is, by its terms, to be
determined by the arbitrator."
The next paragraph argued that courts have a duty under the
Federal Arbitration Act to "rigorously enforce agreements to
37
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
arbitrate." The final few paragraphs stated the relief
Locklear Group requested (i.e., that the trial court "should
compel the Plaintiff to submit his dispute to binding
arbitration, ... and all Court actions, including discovery,
should be stayed pending arbitration") without any reference
to having the arbitrator decide the issue of arbitrability.
When the motion to compel arbitration is read as a whole,
it is clear that Locklear Group did not articulate why the
question of the arbitrability of the claims against it should
be submitted to the arbitrator. Its overriding argument was
devoted to the merits of the issue whether the arbitration
agreement is broad enough to encompass the plaintiffs'
underlying claims against Locklear Group even though Locklear
Group was not a signatory to the arbitration agreement, not to
the proposition that the arbitrator, and not the court, should
decide this issue. Except for the brief reference in
paragraph 10, Locklear Group never mentioned arbitration of
the arbitrability issue anywhere in its motion, including in
its paragraphs specifying the relief it was requesting from
the trial courts. Locklear Group's single, unsupported, and
unexplained sentence in this regard contrasts sharply with its
38
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
relatively fulsome discussion in its motion as to the breadth
of the language of the arbitration agreement and how this
language was sufficient to entitle Locklear Group to
arbitrate
the
plaintiffs' underlying claims (not to mention the
contrast
with the Locklear Group's thoroughly explained position on
the
subject of arbitrability in its brief on appeal to this
Court). Indeed, by focusing essentially all of its attention
on whether the language of the arbitration agreement was broad
enough to cover the plaintiffs' claims against it, Locklear
Group suggested that that was the dispositive issue and that
it was for trial court to decide it.8
Locklear Group contends that the fact that it argued to
the trial courts that the scope of the arbitration agreement
was broad enough to cover claims asserted by the plaintiffs
and that it also mentioned the arbitrability of that issue
constituted the presentation of two arguments in the
8A fair question exists, albeit one we need not address
further, as to whether the trial courts' error could be said
to have been invited under the circumstances. A party "'"may
not predicate an argument for reversal on 'invited error,'
that is, 'error into which he has led or lulled the trial
court.'"'" White Sands Grp., L.L.C. v. PRS II, LLC, 998
So. 2d at 1057 (quoting Mobile Infirmary Med. Ctr. v. Hodgen,
884 So. 2d 801, 808 (Ala. 2003), quoting other cases).
39
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
alternative.
The plaintiffs note, however, that the
arguments
"were not framed as alternative arguments." Instead, the
arbitrability statement is tacked as an afterthought to
Locklear Group's central claim that emphasized the broad scope
of the arbitration agreement.
Based on the foregoing, we conclude that, in the Hubbard,
Averette, Fuller, Booth, and Williams cases, Locklear Group
waived the issue whether the arbitration agreement by its
terms assigns the issue of the arbitrability of the
plaintiffs' claims against Locklear Group to the arbitrator
for decision.
2. The Arbitrability of the Plaintiffs' Claims
Against Locklear Group
Having concluded that it was for the courts to decide the
arbitrability of the underlying claims made by Hubbard,
Averette, Fuller, Booth, and Williams against Locklear Group,
we now consider whether the trial courts correctly decided
that issue. Whether they did so turns on the proper
application
of
the
so-called
"equitable-estoppel
exception"
to
the general rule that an arbitration agreement binds only the
signatories to that agreement.
40
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
a. The Exception to Equitable Estoppel for
"Party Specific" Language
Locklear Group argues that, despite the fact that it is
not a signatory to the arbitration agreement, the plaintiffs
"are equitably estopped from arguing that their claims against
Locklear Group are not subject to arbitration."
"A party typically manifests its assent to
arbitrate a dispute by signing the contract
containing the arbitration provision. Ex parte
Stamey, 776 So. 2d 85, 88–89 (Ala. 2000). One of
the key exceptions to this rule is the theory of
equitable estoppel, under which a nonsignatory can
enforce an arbitration provision when the claims
against the nonsignatory are '"'intimately founded
in and intertwined with'"' the underlying contract
obligations. Stamey, 776 So. 2d at 89 (quoting
Sunkist Soft Drinks, Inc. v. Sunkist Growers, Inc.,
10 F.3d 753, 757 (11th Cir. 1993), quoting in turn
McBro Planning & Dev. Co. v. Triangle Elec. Constr.
Co., 741 F.2d 342, 344 (11th Cir. 1984))."
Smith v. Mark Dodge, Inc., 934 So. 2d 375, 380 (Ala. 2006).
This Court has, however, crafted an exception to this
equitable-estoppel exception: "Where 'the language of the
arbitration provisions limited arbitration to the signing
parties,' this Court has not allowed the claims against the
nonsignatories to be arbitrated." Id. at 380-81 (quoting
Stamey, 776 So. 2d at 89). In other words,
41
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
"[i]f an arbitration agreement is written in
broad language so that it applies to '[a]ll
disputes, claims or controversies arising from or
relating to this Contract or the relationships which
result from this Contract,' Ex parte Napier, 723
So. 2d 49, 51 (Ala. 1998) (emphasis added), or even
in slightly narrower language so that it applies to
'ALL DISPUTES, CLAIMS OR CONTROVERSIES ARISING FROM
OR RELATING TO THIS CONTRACT OR THE PARTIES
THERETO,' Stamey, 776 So. 2d at 91 (capitalization
in original; emphasis added), this Court will
proceed to determine whether arbitration may be
compelled under the doctrine of equitable estoppel.
"Conversely, if the language of the arbitration
provision is party specific and the description of
the parties does not include the nonsignatory, this
Court's inquiry is at an end, and we will not permit
arbitration of claims against the nonsignatory. See
Jim Burke Auto., Inc. v. McGrue, 826 So. 2d 122, 131
(Ala. 2002) (affirming the trial court's order
denying
a
nonsignatory's
motion
to
compel
arbitration where the arbitration agreement was
between 'you [a signatory plaintiff] and us [a
signatory defendant] or our employees, agents,
successors or assigns') (bracketed language added);
Ex parte Lovejoy, 790 So. 2d 933, 938 (Ala. 2000)
(issuing a writ of mandamus directing a trial court
to enter an order denying a nonsignatory's motion to
compel arbitration where the arbitration provision
was limited to 'all disputes or controversies
between you [Lovejoy] and us [Allen Motor Company
and
its
assignees]')
(bracketed
language
and
emphasis in original); First Family Fin. Servs. v.
Rogers, 736 So. 2d 553, 560 (Ala. 1999) (reversing
a trial court's order granting a nonsignatory's
motion to compel arbitration where 'you [the
plaintiffs] and we [First Family]' agreed to
arbitrate and the arbitration provision elsewhere
stated that it applied to 'all claims and disputes
between you [the plaintiffs] and us [First Family],'
42
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
and furthermore stated that it applied to 'any claim
or dispute ... between you [the plaintiff] and any
of our [First Family's] employees or agents, any of
our affiliate corporations, and any of their
employees or agents') (bracketed language and
emphasis in original); and Med Center Cars[, Inc. v.
Smith], 727 So. 2d [9] at 19 [(Ala. 1998)]
(affirming
a
trial
court's
order
denying
nonsignatories' motions to compel arbitration where
the arbitration provisions were limited to disputes
and controversies 'BETWEEN BUYER AND SELLER')
(capitalization in original)."
934 So. 2d at 381.
The plaintiffs in this group of appeals contend that the
arbitration
agreement was
limited
to
controversies
between
the
signatories -- Locklear CJD and each plaintiff -- and thus
that Locklear Group, as a nonsignatory, cannot enforce the
arbitration agreement against the signatory plaintiffs. The
plaintiffs highlight references in the arbitration agreement
to "any party" or "the undersigned" or "the dealer." The
trial courts' orders did the same. In this regard, the trial
courts' orders set out the following passage, which they
attribute to the arbitration agreement:
"'In
connection with
the
undersigned's
acquisition
or
attempted
acquisition
of
the
below described vehicle, by lease, rental,
purchase or otherwise, the undersigned and
the dealer whose name appears below,
stipulate and agree, in connection with the
43
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
resolution of any dispute arising out of,
or
relating
to,
resulting
from
or
concerning any contracts or agreements, or
agreements or contracts to be entered into
by the parties .... shall be submitted to
BINDING ARBITRATION.'"
(Capitalization in original; ellipses supplied by the trial
courts.)
The plaintiffs argue that "[c]ontract language cannot get
much more 'party specific' than [that found in the arbitration
agreements]. There is no hint that the agreements are
intended to cover claims against nonsignatories." The
plaintiffs in particular emphasize a passage of the
arbitration agreement that states that "the undersigned
customer[s] and the dealer agree that the terms of this
arbitration agreement
shall
control
disputes
between
and
among
them." About this passage, the plaintiffs state: "Even aside
from all the other party-specific language in the agreements,
this language makes it clear that the agreements were intended
to control disputes between and among the signatories, with no
indication whatsoever that the agreements control any other
dispute."
44
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
As Locklear Group observes, however, neither the
plaintiffs nor the trial courts fully and accurately quote the
operative language of the arbitration agreement.
First, as to the sentence of the arbitration agreement
emphasized by the plaintiffs, that sentence actually states in
full as follows: "In the event the dealer and the undersigned
customer(s) have entered into more than one arbitration
agreement concerning any of the matters identified herein, the
undersigned customers and the dealer agree that the terms of
this arbitration agreement shall control disputes between and
among them." Obviously, the purpose of this statement is
simply to address which of two arbitration agreements would
control disputes between the parties if the parties have
entered into more than one such agreement related to the
subject transactions.
As to the above-quoted passage from the trial courts'
orders, that passage conflates two separate sentences from the
arbitration agreement. The first sentence, which in the
arbitration agreement ends within the portion of the passage
for which the trial courts substituted an ellipses, actually
reads in its entirety as follows:
45
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
"In connection with the undersigned's acquisition or
attempted
acquisition
of
the
below
described
vehicle, by lease, rental, purchase or otherwise,
the undersigned and the dealer whose name appears
below, stipulate and agree, in connection with the
resolution of any dispute arising out of, or
relating to, resulting from or concerning any
contracts or agreements, or agreements or contracts
to be entered into by the parties, all alleged
representations, promises and covenants, issues
concerning compliance with any state or federal law
or regulation, and all relationships resulting
therefrom, as follows: That the vehicle, services,
and products (hereinafter 'products') involved in
the
acquisition
or
attempted
acquisition
are
regulated by the laws of the United States of
America; and/or, that the contract(s) and agreements
entered into by the parties concerning said products
evidence transactions and business enterprises
substantially involving and affecting interstate
commerce sufficiently to invoke the application of
the Federal Arbitration Act, 9 U.S.C. § 1, et seq."
This sentence merely states that "the undersigned and the
dealer ... stipulate and agree" that the transactions and
agreements "are regulated by the laws of the United States of
America" and that "agreements entered into by the parties
concerning said products evidence transactions and business
enterprises substantially involving and affecting interstate
commerce sufficiently to invoke the
application of the Federal
Arbitration Act, 9 U.S.C. § 1, et seq." In short, this
sentence does nothing more than express the agreement of the
46
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
parties that federal arbitration law is applicable to the
arbitration agreement.
The second sentence, part of which the trial courts added
to the above-quoted passage following the ellipses, is in fact
the operative part of the agreement for present purposes. But
that sentence actually begins as follows:
"The undersigned agree that all disputes not barred
by applicable statutes of limitations, resulting
from, arising out of, relating to or concerning the
transaction entered into or sought to be entered
into (including but not limited to: any matters
taking place either before or after the parties
entered into this agreement, including any prior
agreements or negotiations between the parties; the
terms of this agreement and all clauses herein
contained, their breadth and scope, and any term of
any agreement contemporaneously entered into by the
parties; the past, present and future condition of
any products at issue; the conformity of the
products
to
any
contract
description;
the
representations, promises, undertakings, warranties
or covenants made by the dealer, its agents,
servants, employees, successors and assigns, or
otherwise dealing with the products; any lease, sale
or rental terms or the terms of credit and/or
financing in connection therewith; or compliance
with any state or federal laws; any terms or
provisions of any insurance sought to be purchased
or purchased simultaneously herewith; any terms or
provisions of any extended service contract to be
purchased or purchased simultaneously herewith)
shall be submitted to BINDING ARBITRATION ...."
(Emphasis added.)
47
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
Contrary to the suggestion by the trial courts, this
sentence in the arbitration agreement clearly is not "party
specific" in the sense described in Mark Dodge, but, as
emphasized, actually professes to be applicable to "all
disputes" arising from the transaction and related matters.
There is no language in this passage that restricts the
disputes covered by the arbitration agreement to claims
between the parties.9
The operative arbitration language in the arbitration
agreement is similar to the language in the arbitration
agreement in Ex parte Napier, 723 So. 2d 49, 51 (Ala. 1998),
which provided that "'[a]ll disputes, claims or controversies
arising from or relating to this Contract or the relationships
which result from this Contract ... shall be resolved by
9We note that Hubbard, Averette, Fuller, Booth, and
Williams -- unlike the Lollars and Hood -- do not contend that
the substantive nature of their identity-theft claims, rather
than the nature of the parties against whom those claims are
made, is such that the language of the arbitration agreement
is not broad enough to encompass those claims. Such a
contention would be difficult for Hubbard, Averette, Fuller,
Booth, and Williams to maintain, given that they did not
oppose Locklear CJD's motion for arbitration of the
plaintiffs' similar identity-theft claims against it, which
motion
was
based
on
the
same
substantive arbitration-agreement
language.
48
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
binding arbitration.'" The Napier Court concluded that this
language was "broad enough to encompass Napier and Godfrey's
claims against [nonsignatories] Foremost and Manning." Id.
at
53.
The operative arbitration language in the arbitration
agreement in these cases is also nearly identical to the
language in the arbitration agreement at issue in Volkswagen
Group of America, Inc. v. Williams, 64 So. 3d 1062, 1064 (Ala.
Civ. App. 2010), which provided: "'The undersigned agree that
all disputes ... resulting from or arising out of or relating
to or concerning the transaction entered into ... shall be
submitted to BINDING ARBITRATION ....'" In Williams, the
Court of Civil Appeals disagreed with the plaintiff's
contention that
"the
arbitration
clause
at
issue
is
'party
specific.' The clause, rather, speaks to 'all
disputes ... resulting from or arising out of or
relating to or concerning the transaction,' a
formulation
that
closely
parallels
the
broad
language recognized by the Alabama Supreme Court in
Smith v. Mark Dodge, Inc., 934 So. 2d 375 (Ala.
2006), as authorizing a nonsignatory to assert a
right to compel arbitration through application of
equitable estoppel ...."
Id. at 1065.
49
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
To
reiterate,
when
"references
[in
arbitration
provisions] to the parties specifically limited the claims
that would be arbitrable under those provisions," the Court
has concluded that the arbitration provisions "'are not broad
enough to encompass claims against the nonsignatories.'"
Ex parte Stamey, 776 So. 2d 85, 90 (Ala. 2000) (quoting Med
Ctr. Cars, Inc. v. Smith, 727 So. 2d 9, 19 (Ala. 1998)). On
the other hand, this Court also has held that, when an
arbitration provision "contained no references to the parties
that would impose a limitation on what claims would be
arbitrated," the arbitration provision was broad enough to
include claims that were related to the contract because the
language was sufficient to indicate that "the party resisting
arbitration ha[d] assented to the submission of claims against
nonparties -- claims that otherwise would fall within the
scope of the arbitration provision -- to arbitration."
Stamey, 776 So. 2d at 89. Like the arbitration provisions in
Napier and Williams, the operative arbitration language in
the
arbitration agreement is not limited to claims between the
parties. Accordingly, Locklear Group has cleared this hurdle
to the invocation of the doctrine of equitable estoppel
50
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
against Hubbard, Averette, Fuller, Booth, and Williams. We
turn then to the central issue -- whether the plaintiffs'
claims
against
Locklear
Group,
a
nonsignatory,
are
sufficiently intertwined with their claims against Locklear
CJD, a signatory.
b. Sufficient Intertwining to Invoke Estoppel
As noted, a nonsignatory can enforce an arbitration
provision when the claims against the nonsignatory are
"intimately founded in and intertwined with" the underlying
contract obligations. Stamey, 776 So. 2d at 89. Smith v.
Mark Dodge, Inc., 934 So. 2d at 380. In Kenworth of Mobile,
Inc. v. Dolphin Line, Inc., 988 So. 2d 534 (Ala. 2008), this
Court
summarized the
intertwining analysis
provided
in
Service
Corp. International v. Fulmer, 883 So. 2d 621 (Ala. 2003):
"In Service Corp. International v. Fulmer, 883
So. 2d 621 (Ala. 2003), Blair Fulmer entered into a
contract with SCI Alabama Funeral Services, Inc.
('SCI-Alabama'), for the provision of funeral and
cremation services for his deceased mother. The
contract included an arbitration provision. After
Fulmer was given a vase that was supposed to have
contained his mother's remains but allegedly did
not, Fulmer sued SCI-Alabama and Service Corporation
International
('SCI'),
SCI-Alabama's
parent
corporation. The defendants filed a motion to
compel arbitration, which the trial court denied.
The defendants appealed.
51
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
"SCI argued that, even though it was not a
signatory to the contract containing the arbitration
agreement, 'Fulmer's claims against the signatory
defendant, SCI-Alabama, are so "intertwined" with
his claims against SCI that arbitration of all of
Fulmer's claims, including those against SCI, is
appropriate.' 883 So. 2d at 634. After noting
Stamey's two-part test, this Court addressed the
first part, which relates to whether the claims
against the nonsignatory defendant are intertwined
with the claims against the signatory defendant.
Finding that prong satisfied, this Court wrote:
"'Here, Fulmer's claims against SCI are
clearly
"intimately
founded
in
and
intertwined
with"
his
claims
against
SCI-Alabama.... All of Fulmer's claims
arise from the same set of facts. Virtually
none of Fulmer's claims makes a distinction
between the alleged bad acts of SCI (the
parent
corporation)
and
those
of
SCI-Alabama (its subsidiary); rather, the
claims
are
asserted
as
if
SCI
and
SCI-Alabama acted in concert.'
"883 So. 2d at 634."
988 So. 2d at 543.
Just as in Fulmer, all of the plaintiffs' claims against
Locklear Group in these cases are "intimately founded in" the
same facts as are their claims against Locklear CJD. The
plaintiffs' complaints make virtually no distinction between
the bad acts of Locklear Group and those of Locklear CJD.
Indeed, when the plaintiffs' complaints described purchasing
52
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
their vehicles, they stated that they "dealt with Locklear
[CJD] and/or Defendant Locklear [Group] employee[s]" and
"[t]he Defendant Locklear [CJD] and/or Defendant Locklear
[Group] ran a credit check on" each plaintiff. Every claim
the plaintiffs asserted against Locklear CJD they also
asserted against Locklear Group, and those claims were
asserted as if Locklear CJD and Locklear Group had acted in
concert, as if the latter was responsible for the acts of the
former, and/or as if those persons who acted for one also
acted for the other. Therefore, we conclude that the
plaintiffs' claims against Locklear Group as a nonsignatory to
the arbitration agreement are "intimately founded in and
intertwined
with"
the
underlying contract
obligations
and
with
the plaintiffs' contract-related claims against the signatory
to the arbitration agreement, Locklear CJD, so that the
doctrine of equitable estoppel is applicable.
Based on the foregoing, Locklear Group can enforce the
arbitration agreement against Hubbard, Averette, Fuller,
Booth, and Williams; the trial courts in this group of cases
erred in denying Locklear Group's motions to compel
arbitration.
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1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
B. Case no. 1160435: Jeffery Lollar and Betsy Lollar
As to the Lollars, Locklear CJD and Locklear Group argue
that they met their prima facie burden so as to enforce the
arbitration agreement, having filed a joint motion in support
of which they submitted a contract calling for arbitration and
uncontradicted
evidence
that
the
transaction
affected
interstate commerce. They also note that it is undisputed
that the Lollars filed no response to their joint motion and
supporting evidence.
Accordingly, they contend that the
trial
court had no alternative but to grant their motion to compel
arbitration and that it erred in not doing so.
In support of their position, Locklear CJD and Locklear
Group cite a passage from this Court's opinion Ex parte
Greenstreet, Inc., 806 So. 2d 1203 (Ala. 2001):
"We hold that once a moving party has satisfied its
burden of production by making a prima facie showing
that an agreement to arbitrate exists in a contract
relating to a transaction substantially affecting
interstate commerce, the burden of persuasion shifts
to the party opposing arbitration. If that party
presents no evidence in opposition to a properly
supported motion to compel arbitration, then the
trial court should grant the motion to compel
arbitration."
806 So. 2d at 1209 (emphasis added).
54
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
The Lollars acknowledge that they failed to file a
response to the motion to compel arbitration. They assert
that failing to do so was an oversight that occurred because
their counsel was expecting the trial court to set the motion
to compel for a hearing just as it had done in two similar
cases (one of which is before us in these appeals, case no.
1160375 -- Hood). Instead, in this case the trial court did
not set a hearing; it simply entered an order denying
arbitration before the Lollars filed a response. In an
apparent attempt to rectify this oversight, the Lollars attach
to their brief on appeal their own affidavits and a copy of
what they contend was the actual arbitration agreement they
signed.
Locklear CJD and Locklear Group have rejoined with a
motion to strike the attachments to the Lollars' brief as well
as all references in their brief to those documents. As they
note, this Court cannot consider evidence that is not part of
the record on appeal.
"'"[A]ttachments to briefs are not considered part
of the record and therefore cannot be considered on
appeal."' Morrow v. State, 928 So. 2d 315, 320 n. 5
(Ala. Crim. App. 2004) (quoting Huff v. State, 596
So. 2d 16, 19 (Ala. Crim. App. 1991)). Further, we
55
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
cannot consider evidence that is not contained in
the record on appeal because this Court's appellate
review '"is restricted to the evidence and arguments
considered by the trial court."' Ex parte Old
Republic Sur. Co., 733 So. 2d 881, 883 n.1 (Ala.
1999) (quoting Andrews v. Merritt Oil Co., 612 So.
2d 409, 410 (Ala. 1992) ...)."
Roberts v. NASCO Equip. Co., 986 So. 2d 379, 385 (Ala. 2007).
Locklear CJD and Locklear Group are correct. We do not
consider the evidence submitted by the Lollars on appeal or
their arguments based on that evidence because that evidence
and those arguments were not presented to the trial court;
accordingly, we grant the motion to strike that evidence.
Contrary to Locklear CJD and Locklear Group's argument,
however, the Lollars' lack of response does not end our
inquiry. It is true that, "once a moving party has satisfied
its burden of production by making a prima facie showing that
an agreement to arbitrate exists in a contract relating to a
transaction substantially affecting interstate commerce," the
burden shifts to the nonmoving party to show otherwise.
Ex parte Greenstreet, Inc., 806 So. 2d at 1209 (emphasis
added). It is likewise true that this Court has said that,
"[i]f th[e nonmoving] party presents no evidence in
opposition
to a properly supported motion to compel arbitration, then the
56
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
trial court should grant the motion to compel arbitration."
Ex parte Greenstreet, Inc., 806 So. 2d at 1209 (emphasis
added). Implicit in this standard is that we must evaluate
whether the motion to compel arbitration does make a "prima
facie showing" that the parties entered into an agreement to
arbitrate the dispute in question and that this showing was
"properly supported" by evidence of such an agreement. As we
have otherwise recently expressed in another case in which the
party opposing arbitration failed to present evidence in the
trial court: "[U]nless on its face the arbitration provision
is not valid or does not apply to the dispute in question, the
trial court's decision to deny the motions to compel
arbitration was erroneous." Family Sec. Credit Union v.
Etheredge, [Ms. 1151000, May 19, 2017] ___ So. 3d ___ , ___
(Ala. 2017) (emphasis added).
The arbitration agreement states: "The undersigned agree
that all disputes ... resulting from, arising out of, relating
to or concerning the transaction entered into or sought to be
entered into ... shall be submitted to BINDING ARBITRATION
...." (Emphasis added.) There is no question that the
arbitration agreement is broadly worded (a fact we have relied
57
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
upon in the appeals in the Booth, Williams, Hubbard, Averette,
and
Fuller cases in concluding that the nonsignatory, Locklear
Group, could enforce the agreement against those plaintiffs).
And "'where a contract signed by the parties contains a valid
arbitration clause that applies to claims "arising out of or
relating to" the contract,'" as does this one, "'that clause
has a broader application than an arbitration clause that
refers only to claims "arising from" the agreement.'" Green
Tree Fin. Corp. v. Vintson, 753 So. 2d 497, 505 (Ala. 1999)
(quoting Reynolds & Reynolds Co. v. King Autos., Inc., 689
So. 2d 1, 2–3 (Ala. 1996)). But as stated, this broader
application still is one that is tied to "the contract" to
which reference is made, i.e., claims "'"arising out of or
relating to" the contract,'" per the language at issue in
Green Tree, for example. Or, in the case of the language at
issue here, disputes "resulting from, arising out of,
relating
to or concerning the transaction entered into or sought to be
entered into." See also State v. Lorillad Tobacco, 1 So. 3d
1, 9 (Ala. 2008) (quoting Kenworth of Dothan, Inc. v.
Bruner–Wells Trucking, Inc., 745 So. 2d 271, 275 (Ala. 1999))
(noting that, "[f]or a dispute to relate to the subject matter
58
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
of the arbitration provision, 'there must be some legal and
logical nexus' between the dispute and the [subject matter of
the] arbitration provision").
In this particular case, the parties agreed to arbitrate
matters "relating to ... the transaction entered into," which
was the Lollars' purchase of a 2009 Dodge Ram truck on May 28,
2013. According to the uncontradicted allegations of the
complaint, the personal information of the Lollars' that was
wrongly disseminated in connection with their identity-theft
claims was provided to Locklear CJD in December 2015 during a
visit to the dealership that was not related to the purchase
of the 2009 Dodge Ram truck. On the face of the arbitration
agreement, its terms do not apply to the interaction of the
Lollars and the defendants that occurred in 2015. The 2013
vehicle purchase to which the 2013 arbitration agreement
refers and relates is one transaction. The Lollars' 2015
visit to the dealership for the purpose of exploring whether
to enter into an entirely different transaction with Locklear
CJD (and their provision of financial information to Locklear
CJD during that visit) is, quite simply, an unrelated matter.
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1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
The situation is similar to one presented in Capitol
Chevrolet & Imports, Inc. v. Payne, 876 So. 2d 1106 (Ala.
2003). In that case, Jean Payne purchased a used 1997
Cadillac Catera automobile from Capitol Chevrolet & Imports,
Inc. ("Capitol"), on September 6, 2001. The arbitration
agreement Payne signed in connection with the purchase had
language similar to the arbitration agreement in this case:
"'Buyer/lessee and dealer agree that
all
claims,
demands,
disputes
or
controversies of every kind or nature
between them arising from, concerning or
relating
to any of the negotiations
involved in the sale, lease, or financing
of the vehicle, the terms and provisions of
the sale, lease, or financing agreements,
the
arrangements
for
financing,
the
purchase
of
insurance,
extended
warranties,
service
contracts
or
other
products
purchased as an incident to the sale, lease
or
financing
of
the
vehicle,
the
performance or condition of the vehicle, or
any other aspects of the vehicle and its
sale, lease, or financing shall be settled
by binding arbitration ....'"
876 So. 2d at 1107.
The Court described the facts involved in Payne's claims
against Capitol as follows:
"In September 2002, Payne sued Capitol and a
Capitol salesperson, Jason Golden, alleging fraud
and conversion. According to Payne's complaint,
60
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
approximately one month after she purchased the
Catera, she returned the Catera to Capitol in
reliance on Golden's representation that Capitol had
a willing buyer for the vehicle. Payne relinquished
possession of the Catera to Capitol and stopped
making payments on the car. Payne alleged that
Golden, while acting in the line and scope of his
employment with Capitol, misrepresented to her that
Capitol had a buyer for the Catera, and that, when
Payne relinquished the Catera to Capitol in reliance
on that misrepresentation, Golden converted the
Catera for his personal use. Payne's complaint
alleged that, as a result of the misrepresentation,
she lost the use of her vehicle, suffered severe
mental anguish, and suffered an adverse credit
rating once she stopped making payments on the
Catera."
876 So. 2d at 1107–08.
The Court concluded that Payne's claims were not related
to her purchase of the Catera and therefore were not subject
to the arbitration agreement.
"We do not believe that the plain language of
the arbitration agreement would lead one to assume
or understand that the agreement covered the claims
alleged in Payne's complaint -- a later fraudulent
misrepresentation, unrelated to the original sale of
the vehicle, resulting in the conversion of the
vehicle. The present dispute involves alleged
subsequent tortious conduct on the part of Capitol
and its agent that is not close enough in relation
to the initial sale of the Catera to be covered by
the language of the arbitration agreement."
876 So. 2d at 1110 (emphasis added).
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1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
In this case, as in Payne, the plain language of the
arbitration agreement, which relates to the 2013 transaction,
does not lead one to understand that the 2015 identity-theft
claims would be covered under the agreement. We noted in
Kenworth of Dothan that, "[i]n order for a dispute to be
characterized as arising out of or relating to the subject
matter of the [transaction], and therefore subject to
arbitration, the language of the arbitration provision must
reasonably apply to the dispute." 745 So. 2d at 275.
In response to the clear disconnect between the
transaction to which the arbitration agreement relates and the
separate matters at issue in this action, Locklear CJD and
Locklear Group do not really explain how the arbitration
agreement is broad enough to encompass the Lollars' identity-
theft claims. Instead, they attempt to rely upon the
arbitrability clause in the arbitration agreement (i.e., the
clause providing that the arbitrator is to decide disputes
over the arbitrability of the parties' underlying substantive
dispute) in an effort to avoid this issue. But the difficulty
with this is the same one that existed in the Booth, Williams,
Hubbard, Averette, and Fuller cases. That is, this issue was
62
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
not presented to the trial court in such a manner as to
preserve it for later appellate review. For the reasons
already stated in our discussion of those other cases, we
cannot reverse the trial court's order on that basis.
Because the arbitration agreement on its face does not
apply to the Lollars' claims, we conclude that the trial court
did not err in denying the joint motion to compel arbitration
filed by Locklear CJD and Locklear Group.
C. Case no. 1160375: Anthony Hood
The final appeal before us involves the joint motion to
compel arbitration filed by Locklear CJD and Locklear Group in
response to the complaint filed by Anthony Hood.
Locklear CJD and Locklear Group contend that they
presented a prima facie case in support of their motion to
compel arbitration, i.e., that they introduced a contract
calling for arbitration and produced evidence showing that the
transaction affected interstate commerce. They argue that the
trial court erred in determining the scope of the arbitration
agreement because the arbitration agreement contained an
arbitrability clause reflecting an agreement to allow the
arbitrator to decide any arbitrability issues.
63
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
Hood's first response to these arguments is that the
version of the arbitration agreement Locklear CJD and
Locklear
Group submitted to the trial court "is invalid and
unenforceable because the agreement is fabricated and was not
signed by [Hood] and the issue is for the Court to decide, not
the arbitrator." "'[A] party who contests the existence of a
contract containing an arbitration provision cannot be
compelled to arbitrate that threshold issue because an
arbitrator derives his authority solely from the parties'
agreement. Only a court can resolve the question whether a
contract exists.'" Title Max of Birmingham, Inc. v. Edwards,
973 So. 2d 1050, 1053-54 (Ala. 2007) (quoting Edward D. Jones
& Co. v. Ventura, 907 So. 2d 1035, 1040 (Ala. 2005)).
Hood's position is meritless. As detailed in the
rendition of the facts, Hood alleged in his complaint and
reiterated in his response to the joint motion to compel
arbitration that he purchased a 2016 Dodge Ram 3500 truck from
Locklear CJD in December 2015. He also admitted in his
response that he signed a "Pre-Dispute Arbitration Agreement"
with Locklear CJD. Hood alleged in his response and in his
supporting affidavit that the only difference between the
64
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
version of the arbitration agreement he signed and the one
Locklear CJD and Locklear Group submitted with their joint
motion to compel arbitration was that in the latter version
"[t]he words 'Locklear Chrysler Jeep Dodge, LLC'" had been
added near the bottom of the agreement in a different typeset
than that of the rest of the agreement. Indeed, the version
of the arbitration agreement Hood attached to his brief
contains all the elements contained in the version attached to
the defendants' joint motion to compel arbitration except the
printed words "Locklear Chrysler Jeep Dodge, LLC" typed or
printed above the "DEALER" signature line. Thus, Hood admits
that he signed the arbitration agreement that contains the
substantive language quoted in this opinion; he admits the
agreement was signed by someone on behalf of the "DEALER,"
which he admits to be Locklear CJD; and he admits that the
agreement contained an exact description of the vehicle he
purchased.
Even if the allegation that Locklear CJD and/or Locklear
Group added the words "Locklear Chrysler Jeep Dodge, LLC" to
the arbitration agreement after Hood signed the agreement is
accepted as true, we are given no basis on which to conclude
65
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
that this is a material alteration to the agreement for
purposes of Hood's underlying claims. This Court has stated
that in order to determine whether an alteration is material
we should inquire: "Did the interposed matter make the
'instrument speak a language different in legal effect from
that which it originally spoke, which carries with it some
change in the rights, interests, or obligations of the
parties?'" Benton v. Clemmons, 157 Ala. 658, 660, 47 So. 582,
583 (1908). See also 3B C.J.S. Alteration of Instruments § 4
(2017) ("In general, for the alteration of an instrument to be
'material,' the alteration must be such as to change the legal
effect of the instrument."). In this instance, the alleged
addition of the words "Locklear Chrysler Jeep Dodge, LLC"
changed none of the obligations of the parties to the
arbitration agreement. Hood knew and admitted that he was
signing an arbitration agreement with Locklear CJD in
connection with his purchase of a vehicle. A representative
of the dealership signed the agreement. The terms of that
agreement were not changed in any degree by the alleged
addition of the words "Locklear Chrysler Jeep Dodge, LLC."
Accordingly, the arbitration agreement was not "fabricated,"
66
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
and Hood's argument does not defeat the arbitration of Hood's
underlying claims.10
Like the Lollars, Hood also contends that his identity-
theft allegations are not within the scope of the arbitration
agreement because they do not "result[] from, aris[e] out of,
relat[e] to or concern[] the transaction entered into," i.e.,
the purchase of a vehicle from Locklear CJD, which is the
object of the arbitration agreement. In response, as in the
Lollars' case (and the Hubbard, Averette, Fuller, Booth, and
Williams cases), Locklear CJD and Locklear Group counter that
there is a clause in the arbitration agreement that provides
for the arbitrator to determine the scope of the arbitration
agreement.
Unlike all the other appeals before us, however, in this
case not only was there a hearing on the motion to compel
arbitration, but also that hearing was transcribed and the
transcript submitted as part of the record on appeal.
10In an effort to provide an alternative ground for
affirmance of the trial court's order as to Locklear Group,
Hood also makes a "nonsignatory" argument similar to that made
by first group of plaintiffs discussed above. This argument
by Hood fails for the same reasons as did the similar argument
by those other plaintiffs. See discussion, supra.
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1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
According to that transcript, Hood's counsel argued as
follows
to the trial court: "[O]ur argument is that somebody at the
dealership was being allowed to [take customers' personal
information] and then sell [their] identities out on the black
market[, which] doesn't have anything to do with buying a
car." In response, counsel for Locklear CJD and Locklear
Group stated:
"And our response to that specific argument is,
first, we believe that the arbitration agreement is
broad enough in scope to cover these. But, more
importantly, we don't even get to that issue here
before you, your Honor. The arbitration agreement
clearly provides that the issue of scope and breadth
arbitrability is for the arbitrator to decide, not
this trial court. So whether or not the claims
being asserted fall within the scope of the
arbitration agreement is for the arbitrator to
decide based on the plain and unambiguous language
in the arbitration agreement. Plus, it applies for
AAA rules, and there [are] Alabama Supreme Court
cases that clearly state that, that in and of itself
also shows an intent based on those rules to allow
the arbitrator to decide the issue of scope and
breadth. So that is something that the arbitrator
is to determine and not this court."
Thus, in Hood's case, Locklear CJD and Locklear Group
clearly and explicitly argued to the trial court that there
was an arbitrability clause in the arbitration agreement and
that the import of the clause was that the issue whether
68
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
Hood's identity-theft claims were covered by the arbitration
agreement was for the arbitrator to decide, not the trial
court. Therefore, the effect of the arbitrability clause is
properly before us in this appeal.
Hood's first response to Locklear CJD and Locklear
Group's invocation of the arbitrability clause is to contend
that "clear and unmistakable evidence that [Hood] and [the]
Locklear Defendants agreed to arbitrate the issue of
arbitrability does not exist because a valid arbitration
agreement does not exist." This argument relies upon Hood's
assertion, which we just rejected, that the arbitration
agreement was fabricated. Because we have concluded that a
valid arbitration agreement was submitted by Locklear CJD and
Locklear Group, the arbitrability clause cannot be ignored on
that basis.
Hood next contends that the "Locklear Defendants arguably
waived a 'First Options clause' argument because this argument
was not presented in their initial Motion to Compel
Arbitration with the trial court or in oral argument on the
69
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
same."11 As we have already recounted, however, Locklear CJD
and Locklear Group clearly and explicitly presented its
arbitrability-clause argument to the trial court in the
hearing on their joint motion to compel arbitration.
Hood also argues that the arbitrability clause in the
arbitration agreement is "wholly diverse from the "'First
Options clause' in [Smith v.] Mark Dodge[, Inc., 934 So. 2d
375 (Ala. 2006)]." Hood notes that the arbitrability clause
in Smith stated: "'[Smith] and [Mark Dodge] further agree
that any question regarding whether a particular controversy
is
subject
to
arbitration
shall
be
decided
by
the
Arbitrator.'" 934 So. 2d at 378. Hood argues that "[t]he
explicit language in Mark Dodge stating 'whether a particular
controversy is subject to arbitration shall be decided by the
Arbitrator'
is
clearly
missing
from
[the]
Locklear
Defendants'
fabricated arbitration agreement."
In their principal brief, Locklear CJD and Locklear Group
do not contend that the arbitrability clause in the
arbitration
agreement
is
similar
in
wording
to
the
11Hood's reference to a "First Options clause" is a
reference to the discussion of arbitrability clauses in First
Options of Chicago, Inc. v. Kaplan, 514 U.S. 938 (1995).
70
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
arbitrability clause in Smith. Instead, they argue correctly
that the arbitrability-clause language in the arbitration
agreement is identical to language in arbitration agreements
analyzed by this Court in Jim Burke Automotive, Inc. v.
McGrue, 826 So. 2d 122 (Ala. 2002), and Ex parte Waites, 736
So. 2d 550 (Ala. 1999).12 As Locklear CJD and Locklear Group
observe, this Court in McGrue and Waites held that the
arbitrability
clauses
in
those
arbitration
agreements
constituted clear and unmistakable evidence that the parties
intended to arbitrate issues of arbitrability.
In his brief to this Court, Hood addresses McGrue and
Waites, but only by contending that they are distinguishable
from the present case on the ground that "neither [McGrue nor
Waites] disputed the validity of the underlying arbitration
agreements." As we already have concluded, however, Hood's
contention that the arbitration agreement was "fabricated"
must be rejected. The fact remains, then, that in McGrue and
Waites this Court concluded that language identical to that
contained in the arbitration agreement was sufficient to
warrant submission of issues of arbitrability to the
12See discussion, supra.
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1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
arbitrator. Hood offers no other reason why McGrue and Waites
would not be dispositive of the present case.
IV. Conclusion
Based on the foregoing analysis, we affirm the order of
the trial court in the Lollars' appeal, which denied the joint
motion to compel arbitration filed by Locklear CJD and
Locklear Group. We reverse the trial courts' orders in
Hubbard's, Averette's, Fuller's, Booth's, and Williams's
appeals, which denied the motions to compel arbitration as to
Locklear Group, and in Hood's appeal, which denied the joint
motion to compel arbitration filed by Locklear CJD and
Locklear Group; those causes are remanded for the trial courts
to enter orders granting those motions.
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1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
1160335 -- REVERSED AND REMANDED.
1160336 -- REVERSED AND REMANDED.
1160337 -- REVERSED AND REMANDED.
1160435 -- MOTION TO STRIKE GRANTED; AFFIRMED.
1160436 -- MOTION TO STRIKE GRANTED; REVERSED AND
REMANDED.
1160437 -- MOTION TO STRIKE GRANTED; REVERSED AND
REMANDED.
Stuart, C.J., and Bolin, Main, and Bryan, JJ., concur.
1160375 -- REVERSED AND REMANDED.
Stuart, C.J., and Bolin, Main, and Bryan, JJ., concur.
Murdock, J., concurs specially.
73
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
MURDOCK, Justice (concurring specially in case no. 1160375).
As the main opinion explains, Anthony Hood responds to
the invocation by Locklear Chrysler Jeep Dodge, LLC, and
Locklear Automotive Group, Inc., of this Court's decisions in
Jim Burke Automotive, Inc. v. McGrue, 826 So. 2d 122 (Ala.
2002), and Ex parte Waites, 736 So. 2d 550 (Ala. 1999), but he
does so by arguing only that those cases involved no issue as
to the validity of the underlying arbitration agreements,
whereas, according to Hood, the underlying arbitration
agreement in this case is invalid (the rejection of the latter
proposition by the main opinion being a position with which I
agree). Hood does not, for example, attempt to argue that the
language of the arbitrability provision at issue here is
materially different from that held to be sufficient in McGrue
and Waites. Neither does Hood argue that we should overrule
McGrue and Waites. And, although I confess concerns as to the
sufficiency of the language here to meet the "clear and
unmistakable" test articulated in First Options of Chicago,
Inc. v. Kaplan, 514 U.S. 938 (1995), other than pointing out
that the language used here is "diverse" from the more
explicit language employed in First Options, Hood does not
74
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
offer a sufficient explication of the asserted insufficiency
so as to compel a reexamination of McGrue and Waites. And
because the question at hand does not concern the subject-
matter jurisdiction of the trial court or this Court, I cannot
conclude that this Court should sua sponte explore the matter.
In addition, neither party has even mentioned this
Court's 2012 decision in Auto Owners Insurance, Inc. v.
Blackmon Insurance Agency, Inc., 99 So. 3d 1193 (Ala. 2012).
In particular, Hood does not argue that, even if the
arbitrability language at issue satisfies the "clear and
unmistakable" standard articulated in First Options, the
particular underlying substantive claims in this case should
not be sent to the arbitrator for consideration of their
arbitrability because they do not even "arguably" fall within
the ambit of the arbitration agreement. See Blackmon, 99
So. 3d at 1198. That is, no issue is raised as to whether
Hood's identity-theft claims fall within the universe of
disputes to which the so-called arbitrability clause is to
apply. I feel no compunction therefore to cast a vote in this
case reflective of the position I took in my dissent in
75
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
Blackmon, a position to which I continue to adhere. See
Blackmon, 99 So. 3d at 1199 (Murdock, J., dissenting).
76 | September 29, 2017 |
342b0cbc-8705-4c8a-89ff-74b892d77a4c | Poff v. Hayes | 763 So. 2d 234 | 1980938 | Alabama | Alabama Supreme Court | 763 So. 2d 234 (2000)
Richard G. POFF, Jr.
v.
Robert J. HAYES.
1980938.
Supreme Court of Alabama.
February 4, 2000.
*236 Richard G. Poff, Jr., Birmingham, pro se.
Jack E. Swinford, Birmingham, for appellee.
MADDOX, Justice.
Richard Poff, a law clerk at the law firm of Roden, Hayes, and Carter, P.C. ("the firm"), secretly photocopied records in the office of Robert Hayes, one of the shareholders in the firm. He copied them ostensibly to collect evidence to present to the Alabama State Bar regarding unethical practices he thought were occurring at the *237 firm. These practices resulted in a disciplinary proceeding being filed against Robert Hayes.[1]
After the disciplinary proceeding against Hayes was concluded, Hayes sued Poff, alleging trespass to real and personal property; conversion; malicious prosecution; and libel and slander. Poff was served with a copy of the complaint on September 30, 1997, and on October 21, 1997, he filed a "Motion to Dismiss/Motion for More Definite Statement." The trial court subsequently overruled Poff's motion to dismiss, but granted his request for a more definite statement. On January 14, 1998, Hayes filed his response to Poff's preanswer motion, after which Poff filed his answer; the answer contained a jury demand. The case proceeded through the discovery stage, and the trial court, by an order dated September 25, 1998, set the case for trial on December 14, 1998.
When the case was called for trial on December 15, 1998, the trial court granted Hayes's motion to strike Poff's demand for trial by jury. Poff vehemently protested, and was held in contempt of court and jailed. Poff was brought back into court on the afternoon of December 15, and the trial court then began to conduct a bench trial. Poff refused to testify when called as a witness; the trial court entered a judgment for Hayes and heard evidence on the issue of damages. The trial court then entered a judgment in favor of Hayes and against Poff for $1,151,501.
This case presents the question whether the trial court properly denied a summary judgment in Poff's favor on Hayes's claims, and, if so, then whether the trial court erred in striking Poff's demand for a trial by jury.
Poff was hired by the firm in November 1992 as a law clerk. At some point thereafter, he became suspicious of the billing practices of Hayes and his two partners. Specifically, Poff suspected them of improperly charging personal expenses to clients.
Poff began to gather evidence against Hayes and the other partners by copying various documents and records located throughout the office, in such places as Hayes's credenza and the bookkeeper's office. The materials he copied included checks, credit-card statements, and the partnership's ledgers.[2] The ledgers were the only documents generated by the firm. Poff copied all of these items on the firm's photocopier, and he never removed the original documents from the premises.
On June 21, 1994, Poff filed a complaint with the Alabama State Bar, which initiated a disciplinary proceeding against Hayes. The Alabama Attorney General's Office and the Alabama Bureau of Investigation also became involved and began their own investigations of the billing practices at the firm. All of these events quickly became a subject of interest by Birmingham news media. As the events unfolded, Poff began to give the media information regarding the nature of the alleged improprieties. For example, on February 26, 1996, Poff wrote a lengthy letter to Scott Richards, a news reporter for a Birmingham television station, explaining his theory regarding how the firm disguised questionable billings in its ledgers. Poff's letter described the nature of the billings with particularity, by setting out specific transactions as they applied to certain clients. He then described how he believed the inconsistencies arose.
Subsequently, as news of the investigations and proceedings grew, former clients of the firm began to sue. One former client, Deborah Taylor, hired Poff as her attorney and sued Hayes and others for malpractice. Hayes, denying that he had *238 had any involvement in handling the case that was the basis for Taylor's claim, demanded to be dismissed as a party to her case. The trial court later granted Hayes's motion for a summary judgment in Taylor's case.
We first consider whether Poff was entitled to a summary judgment as to Hayes's four sets of claims. On this issue, the critical questions presented seem to be: (1) Who held the possessory interests in the real and personal property that are the subject of the trespass and conversion claims; and (2) when were the alleged defamations published? We first set out the rules that govern our review of a trial court's ruling on a motion for summary judgment.
"In reviewing the disposition of a motion for summary judgment, we utilize the same standard as ... the trial court in determining whether the evidence before [it] made out a genuine issue of material fact" and whether the movant was "entitled to a judgment as a matter of law." Bussey v. John Deere Co., 531 So. 2d 860, 862 (Ala.1988) (citing Chiniche v. Smith, 374 So. 2d 872 (Ala.1979)); Rule 56(c) Ala. R.Civ.P. The movant has the burden of showing material facts, which, if uncontested, entitle the movant to a judgment as a matter of law. Woodham v. Nationwide Life Ins. Co., 349 So. 2d 1110, 1111 (Ala. 1977). Once the movant has made this showing, the opposing party then has the burden of presenting evidence creating a genuine issue of material fact. Danford v. Arnold, 582 So. 2d 545, 546 (Ala.1991); Bass v. SouthTrust Bank of Baldwin County, 538 So. 2d 794, 797-98 (Ala.1989). Moreover, the nonmovant must meet the burden of establishing the existence of a genuine issue of material fact by substantial evidence. Ala.Code 1975, § 12-21-12; Bass v. SouthTrust Bank of Baldwin County, supra. "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." West v. Founders Life Assurance Co. of Florida, 547 So. 2d 870, 871 (Ala.1989).
Furthermore, 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, 413 (Ala.1990); Harrell v. Reynolds Metals Co., 495 So. 2d 1381, 1383 (Ala. 1986); Wilson v. Brown, 496 So. 2d 756, 758 (Ala.1986). With these principles in mind, we will consider the facts set out above as those to which the law must be applied.
The first count in Hayes's complaint alleges three causes of action: trespass to chattels, conversion, and trespass to real property. Because trespass to chattels and conversion are closely related claims, we will address them together, before discussing the claim alleging trespass to real property.
Hayes claims that Poff interfered with his possessory rights to records concerning his car-washing business, as well as the firm's ledgers, when Poff removed them for a brief period from where they were kept so that he could photocopy them. At the outset, we note that in trespass actions involving chattels, not all interferences with possession are actionable. Restatement (Second) of Torts, § 218 (1965), states: "One who commits a trespass to a chattel is subject to liability to the possessor of the chattel if, but only if, (a) he dispossesses the other of the chattel, or [does other things not pertinent here]." Thus, the initial question before us is whether the removal of Hayes's credit-card receipts, business records, and the firm's accounting ledgers was a "dispossession."
*239 The Restatement defines "dispossession" to include the "taking of a chattel from the possession of another without the other's consent." Restatement (Second) of Torts, § 221. A dispossession is distinguished by the exercise of dominion and control in a manner that contravenes the plaintiff's possessory interest. See Restatement, § 221 cmt. b.
The evidence tends to show that Poff exercised dominion and control, albeit briefly, over Hayes's credit-card receipts, his business records, and the firm's ledgers, and that he consequently effected a dispossession of those items. Because "[a] dispossession is always a trespass to the chattel, and subjects the actor to liability for at least nominal damages for the interference with the possession," Restatement, § 222 cmt. a, Poff's argument that he did not substantially interfere with Hayes's possession is without merit as to the claims alleging trespass to chattels, but his argument is persuasive as to Hayes's conversion claims.
Conversion, as a cause of action, is closely similar to an action for trespass to chattels, see Wint v. Alabama Eye & Tissue Bank, 675 So. 2d 383, 384-85 (Ala 1996)(quoting Roberts and Cusimano, Alabama Tort Law Handbook, § 29.0, p. 598 (1990)), but these actions differ in that the tort of conversion requires a more extensive interference with the plaintiff's possession. Restatement, § 222 cmt. a, reads:
The undisputed evidence tends to show that Poff removed all of the documents from Hayes's credenza or the bookkeeper's office for the sole purpose of photocopying them in order to support the ethics complaint he filed against Hayes and the other partners of the firm. After he completed this task, he returned each document to its original place. While this interference with possessory rights held by others constituted a dispossession, we conclude that the evidence shows that the dispossession did not seriously interfere with Hayes's possessory rights to the degree necessary to create an issue of fact as to whether a conversion occurred. Consequently, Poff was entitled to a summary judgment on Hayes's claim alleging conversion. On this claim, we render a judgment for Poff.
The claim alleging trespass to chattels requires additional examination, however. We must decide whether Hayes had a possessory right to the papers Poff photocopied. Initially, we note that there is no issue as to whether Hayes had a right to possession of the credit-card records and other papers concerning Hayes's car-washing business; therefore, the trial court correctly denied Poff's motion for summary judgment on the trespass claim as it related to these items. But the accounting records, which belonged to the firm, which was a professional corporation, present the issue whether Hayes, who had an interest in the corporation, had a possessory interest in records owned and maintained by the corporation.
Poff argues that the claims alleging trespass to realty and trespass to personalty belonging to the firm must fail because Hayes filed the claim in his own name, although, Poff says, Hayes was not the sole possessor of the property. Alabama law regarding the sanctity of the corporate form is well settled:
Martin Truck Line, Inc. v. Alabama Tank Lines, Inc., 261 Ala. 163, 166, 73 So. 2d 756, 759 (1954); see also Pinkerton v. Pinkerton, 548 So. 2d 449, 450 (Ala.1989); see generally, § 10-2B-3.02, Ala.Code 1975. The corporate records that Poff photocopied, located on the firm's premises, were in the exclusive possession of the firm, which was a professional corporation and which had an identity distinct from Hayes, who was one of its shareholders. Thus, Hayes was not entitled to prosecute the claim alleging trespass to chattels that belonged to, and were in exclusive possession of, the corporation in which he was a shareholder. Accordingly, we reverse the trial court's judgment for Hayes insofar as it related to this claim alleging trespass to chattels. On this claim, we render a judgment for Poff.
Hayes also claims that Poff trespassed on real property when he entered the bookkeeper's office and when he opened Hayes's locked credenza. Hayes claims Poff was not authorized to enter either the bookkeeper's office or the credenza in Hayes's office and to copy documents found there. We must decide an issue similar to one of the questions decided in Part AWas Hayes in possession of the corporate realty upon which he says Poff trespassed?
Trespass to real property is similar to trespass to chattels in that trespass, generally, "is a wrong against the right of possession." Jefferies v. Bush, 608 So. 2d 361, 362 (Ala.1992). Poff's intrusion into Hayes's credenza and into the bookkeeper's office was an interference with corporate property. Because a claim based on that interference can be brought only by the corporation that owned and possessed the property, see Part III.A., supra, Hayes is not entitled to prosecute this claim. To the extent the judgment related to the claim alleging trespass to realty, the judgment is reversed. A judgment is rendered for Poff on that claim.
Hayes alleges that Poff committed the tort of malicious prosecution when he represented Deborah Taylor in a lawsuit against Hayes. That lawsuit ended with a summary judgment in Hayes's favor.[3] A plaintiff must prove five elements in a claim alleging malicious prosecution: (1) that a prior judicial proceeding was initiated by the present defendant; (2) the lack of probable cause in the institution of that prior proceeding; (3) malice on the part of the present defendant in instituting that prior proceeding; (4) termination of the prior judicial proceeding favorably to the present plaintiff; and, (5) damage to the present plaintiff occurring as a result of that prior proceeding. Empiregas, Inc. of Elberta v. Feely, 524 So. 2d 626, 627 (Ala.1988). Poff's sole argument regarding the trial court's denial of his summary-judgment motion as it related to the malicious-prosecution claim is that the record contains no evidence indicating that he *241 initiated the action filed by Deborah Taylor.
Poff argues that Hayes's malicious-prosecution claim must fail because, Poff says, he had no part in filing Taylor's action. He contends that he had no knowledge that the action was even filed until he read a story about it in a newspaper. We find this contention inaccurate and reject it.
A cause of action for malicious prosecution is not limited to the situation where the present defendant initiated the prior proceeding; it also arises in the situation where the present defendant continued the prior proceeding without probable cause, see Hudson v. Chancey, 385 So. 2d 61, 62 (Ala.Civ.App.1980), and one can be held liable for malicious prosecution when he "takes some active part in the instigation or encouraging of the prosecution." W. Page Keeton, Prosser and Keeton on Torts, § 119 (5th ed.1984). "Tak[ing] some active part" includes advising or assisting another person to begin the proceeding and actively directing or aiding in the conduct of it. Id.
Although Poff may not have played any part in initiating Taylor's action, he participated in that action as Taylor's attorney and thus was certainly involved in its continuing prosecution. His representation of Taylor raises at least an inference that he actively assisted her and vigorously directed and aided the conduct of the prior case in a manner consistent with his role as her advocate. Thus, we must reject Poff's argument that Hayes cannot meet the first element of a malicious-prosecution claim. The trial court correctly denied Poff's summary-judgment motion directed to this claim.[4]
Hayes also made claims against Poff alleging libel and slander. Poff argues that the trial court should have entered a summary judgment for him on these claims because of imprecise pleading in Hayes's complaint. Specifically, Poff argues that the statutory limitations period had expired on these claims. The basis for this argument is found in Hayes's complaint, which states: "Plaintiff claims that on or about June 16, 1994 and on many other numerous occasions the Defendant libeled and slandered the Plaintiff." Poff argues that the complaint pertains solely to acts committed on June 16, 1994, and that the phrase "and on many other numerous occasions" has no legal significance.
Our construction of Hayes's pleadings is governed by Rule 8(f), Ala. R. Civ. P., which states that "[a]ll pleadings shall be so construed as to do substantial justice." "In order to do substantial justice, pleadings are to be construed liberally in favor of the pleader." Waters v. Jolly, 582 So. 2d 1048, 1055 (Ala.1991); see also Rule 8, Ala. R. Civ. P., Committee Comments. Whether the trial court should have entered a summary judgment in favor of Poff ultimately depends on how we construe Hayes's complaint. We must disagree with Poff's assertion that the vague language in the complaint regarding dates of publicationthe phrase "and on many other numerous occasions"is meaningless. We note that Hayes's original complaint was not his only pleading. The record shows that Hayes filed and served an amended complaint in response to a preanswer motion filed by Poff requesting a more definite statement. This second pleading alleges multiple acts of publication that a fact-finder could determine occurred on such dates that the fact-finder could further conclude that the action was filed well within the period allowed by the applicable statute of limitations. Consequently, we must reject Poff's argument based on the statute of limitations.
*242 The statute of limitations for actions alleging libel or slander prescribes a period that runs from the date of publication that is the date on which the injury to the plaintiff's reputation occurs and the cause of action is completed. See Tonsmeire v. Tonsmeire, 285 Ala. 454, 455, 233 So. 2d 465, 466 (1970). Moreover, every distinct publication of libelous or slanderous material gives rise to a separate cause of action, even if the material communicated by each publication relates to the same matter as the previous publications.[5]Age-Herald Publ'g Co. v. Waterman, 188 Ala. 272, 278, 66 So. 16, 18 (1913).
The applicable statute of limitations allowed two years for filing the action. See § 6-2-38(k), Ala. Code 1975. The undisputed evidence tends to show that two publications occurred within the two-year period before Hayes filed his action. The first publication was made in a letter dated January 29, 1996, and the second publication was made in a letter addressed to a Birmingham television station and dated February 26, 1996.[6] Hayes filed the complaint on September 10, 1997. Consequently, we hold that Poff was not entitled to a judgment on Hayes's defamation claims. The trial court erred, however, in not limiting Hayes's defamation claims to the two publications that occurred within the two years preceding the date Hayes filed his complaint. The judgment is reversed insofar as it related to claims alleging defamation.
The final issue presented is whether the trial court erred when it denied Poff a trial by jury. Poff included a jury demand in his answer to Hayes's complaint. We hold that the trial court did err in this regard.
The right to a jury trial is guaranteed by Ala. Const. of 1901, § 11. Rule 38, Ala. R. Civ. P., prescribes the method for exercising this right:
(Emphasis added). Hayes argues in his brief that "Poff was served with the Summons and Complaint," and that "[a]ccording to Rule 38(b), Poff had thirty days from September 30, 1997, to file a jury demand." This argument is contrary to well-established Alabama law relating to the time within which a demand for jury trial can be made, and it is completely without merit.
*243 According to Rule 38(b), the time allowed for filing a jury demand runs from the date of service of the "last pleading directed to such issue [i.e., the issue as to which a jury trial is sought]." The term "pleading," which is specifically used in Rule 38(b), Ala. R. Civ. P., is defined to include an answer filed by a defending party. Rule 7(a), Ala. R. Civ. P. "It is well recognized that where the complaint and answer are the only pleadings directed to the issues, the time for making a jury demand runs from the date of service of the answer." Dorcal, Inc. v. Xerox Corp., 398 So. 2d 665, 669 (Ala.1981); see also Ex parte Reliance Ins. Co., 380 So. 2d 266 (Ala.1980); Champ Lyons, Jr., Alabama Rules of Civil Procedure Annotated § 38.3 (3d ed.1996); and C. Wright and A. Miller, Federal Practice and Procedure § 2320 (1971).
Poff included a jury demand with his answer, and under our Rules of Civil Procedure, his answer was clearly a "pleading" within the meaning of that word as it is used in Rule 38(b), and within the intent of that rule. Consequently, Poff's jury demand was timely. The trial court erred in striking it. This error requires that we reverse all portions of the judgment not already reversed, and remand the case for a trial by jury on those claims that we have held were appropriate for trial.
JUDGMENT REVERSED; JUDGMENT RENDERED ON THE CLAIMS ALLEGING TRESPASS TO REAL ESTATE, TRESPASS TO CHATTELS, AND CONVERSION; AND CAUSE REMANDED.
HOUSTON, COOK, SEE, LYONS, BROWN, JOHNSTONE, and ENGLAND, JJ., concur.
[1] See Hayes v. Alabama State Bar, 719 So. 2d 787 (Ala.1998).
[2] The checks and credit-card statements related to Hayes's partial ownership and management of a car-washing business.
[3] Hayes's affidavit testimony accompanying his reply to Poff's motion for a summary judgment is the only evidence in the record regarding a favorable disposition of the action previously filed against him (i.e., the Taylor action). Alabama law regarding the admissibility of this evidence is well established: "The best evidence of a judicial proceeding is the record itself, or a copy where copies are admissible or must be used as proof of such records." Kroger Co. v. Puckett, 351 So. 2d 582, 587 (Ala.Civ.App.1977); see also Abingdon Mills v. Grogan, 167 Ala. 146, 153-54, 52 So. 596, 599 (1910); Rule 1005, Ala. R. Evid.; Rule 44, Ala. R. Civ. P.; and Charles W. Gamble, McElroy's Alabama Evidence, § 229.02(3) (5th ed.1996). The record, however, shows that Poff never challenged the admissibility of this evidence; therefore, the evidence was properly admitted, Kroger Co., 351 So. 2d at 588, and we may consider it.
[4] Poff has raised no issue, and has presented no argument, as to whether Hayes proved the other elements of his malicious-prosecution claim. Thus, the question whether those elements have been met is not before us. Our analysis, therefore, is limited to what we have heretofore addressed. See Bettis v. Thornton, 662 So. 2d 256, 257 (Ala.1995).
[5] The "single-publication" rule, generally applicable only to newspapers and similar media, is a notable exception to this general rule. That exception does not govern the resolution of this case, because of the nature of this defendant's alleged publications. An early statement of this exception is found in Age-Herald Publ'g Co. v. Huddleston, 207 Ala. 40, 92 So. 193 (1921). In that case, this Court held that "repetition or republication of [an] identical libel [and slander] is not a new cause of action for which a separate suit may be maintained, but is merely an aggravation of the pre-existing cause, and in proper cases may tend to show actual malice." Age-Herald Publ'g Co., 207 Ala. at 44, 92 So. at 197. Hayes essentially argues that this exception applies to this present case because in each publication, Poff, he says, communicated the same defamatory information. We find fault with this argument because the exception enunciated in Age-Herald Publ'g Co. only applies only to situations where subsequent acts of defamation are verbatim republications of previously made libelous or slanderous statements. See id. Age-Herald Publ'g Co. v. Huddleston is inapposite to the case before us because each of Poff's alleged publications was a separate communication distinct from all others allegedly made.
[6] The pleading Hayes filed after Poff's motion for a more definite statement merely set out these publications. | February 4, 2000 |
07fee43a-5f84-4a23-b32c-afe70cfda7bc | Locklear Chrysler Jeep Dodge, LLC v. Hood | N/A | 1160375, 1160335, 1160336, 1160337, 1160435, 1160437, 1160436 | Alabama | Alabama Supreme Court | REL: 09/29/2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
SPECIAL TERM, 2017
____________________
1160335
____________________
Locklear Automotive Group, Inc.
v.
Brad Hubbard
Appeal from Tuscaloosa Circuit Court
(CV-16-900716)
____________________
1160336
____________________
Locklear Automotive Group, Inc.
v.
Jeremy Averette
Appeal from Tuscaloosa Circuit Court
(CV-16-900683)
____________________
1160337
____________________
Locklear Automotive Group, Inc.
v.
Carol Fuller
Appeal from Tuscaloosa Circuit Court
(CV-16-901091)
____________________
1160375
____________________
Locklear Chrysler Jeep Dodge, LLC, and
Locklear Automotive Group, Inc.
v.
Anthony Hood
Appeal from Bibb Circuit Court
(CV-16-900098)
____________________
1160435
____________________
Locklear Chrysler Jeep Dodge, LLC, and
Locklear Automotive Group, Inc.
v.
Jeffery Lollar and Betsy Lollar
Appeal from Bibb Circuit Court
(CV-16-900081)
____________________
1160436
____________________
Locklear Automotive Group, Inc.
v.
Elizabeth Montana Booth
Appeal from Bibb Circuit Court
(CV-16-900074)
____________________
1160437
____________________
Locklear Automotive Group, Inc.
v.
Dorothea Williams
Appeal from Bibb Circuit Court
(CV-16-900073)
MURDOCK, Justice.
Before us are appeals from denials of motions to compel
arbitration filed by Locklear Chrysler Jeep Dodge, LLC
("Locklear CJD"), and Locklear Automotive Group, Inc.
3
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
("Locklear Group"), in
actions filed by plaintiffs who alleged
that they were victims of identity theft resulting from
personal information they had provided Locklear CJD in order
to explore the possibility of financing the purchase of a
vehicle from Locklear CJD. In case no. 1160435, we affirm the
order of the trial court denying the motion to compel
arbitration; in the other appeals, we reverse the trial
court's orders and remand the causes.
I. Facts
All the plaintiffs in these cases purchased vehicles from
Locklear CJD. All the plaintiffs signed an arbitration
agreement as part of their vehicle purchases; the operative
language of those arbitration agreements is the same. And all
the plaintiffs alleged that they were the victims of identity
theft that resulted from providing personal information to
Locklear CJD when they filled out credit applications for the
vehicle purchases.
In addition to naming Locklear CJD as a defendant, the
plaintiffs' complaints named multiple other defendants who
they alleged played a part in the identity thefts. Among the
other defendants named is Locklear Group. According to an
4
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
affidavit from Christopher S.
Locklear, Sr., vice president of
Locklear CJD, Locklear Group "is the sole member of Locklear
Chrysler Jeep Dodge, LLC."
The arbitration agreement signed by each plaintiff is
titled "Binding Pre-Dispute Arbitration Agreement" ("the
arbitration agreement"), and its operative language is as
follows:
"In
connection
with
the
undersigned's
acquisition or attempted acquisition of the below
described vehicle, by lease, rental, purchase or
otherwise, the undersigned and the dealer whose name
appears below, stipulate and agree, in connection
with the resolution of any dispute arising out of,
or relating to, resulting from or concerning any
contracts or agreements, or agreements or contracts
to be entered into by the parties, all alleged
representations, promises and covenants, issues
concerning compliance with any state or federal law
or regulation, and all relationships resulting
therefrom, as follows: That the vehicle, services,
and products (hereinafter 'products') involved in
the
acquisition
or
attempted
acquisition
are
regulated by the laws of the United States of
America; and/or, that the contract(s) and agreements
entered into by the parties concerning said products
evidence transactions and business enterprises
substantially involving and affecting interstate
commerce sufficiently to invoke the application of
the Federal Arbitration Act, 9 U.S.C. § 1, et seq.
The undersigned agree that all disputes not barred
by applicable statutes of limitations, resulting
from, arising out of, relating to or concerning the
transaction entered into or sought to be entered
into (including but not limited to: any matters
5
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
taking place either before or after the parties
entered into this agreement, including any prior
agreements or negotiations between the parties; the
terms of this agreement and all clauses herein
contained, their breadth and scope, and any term of
any agreement contemporaneously entered into by the
parties; the past, present and future condition of
any products at issue; the conformity of the
products
to
any
contract
description;
the
representations, promises, undertakings, warranties
or covenants made by the dealer, its agents,
servants, employees, successors and assigns, or
otherwise dealing with the products; any lease, sale
or rental terms or the terms of credit and/or
financing in connection therewith; or compliance
with any state or federal laws; any terms or
provisions of any insurance sought to be purchased
or purchased simultaneously herewith; any terms or
provisions of any extended service contract sought
to
be
purchased
or
purchased
simultaneously
herewith) shall be submitted to BINDING ARBITRATION,
pursuant to the provisions of 9 U.S.C. § 1, et seq.
and according to the Commercial Dispute Resolution
procedures and/or consumer protocol (depending on
the
amount
in
controversy)
of
the
American
Arbitration Association (the AAA) then existing in
the county where the transaction was entered into or
sought to be entered into, except as follows:
(a) In all disputes in which the matter in
controversy (including compensatory and punitive
damages, fees and costs) is more than $10,000 but
less than $75,000.00, one arbitrator shall be
selected in accordance with the AAA's Consumer
Protocol. In all disputes in which the matter in
controversy (including compensatory and punitive
damages and fees and costs) is $75,000.00 or more,
the parties to this agreement shall select an
arbitrator under the AAA's Commercial Rules and
shall select one arbitrator from a list of at least
5 suitable arbitrators supplied by the AAA in
accordance with and utilizing the AAA strike method.
6
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
(b) An arbitrator so selected shall be empowered to
enter an award of such damages, fees and costs, and
grant such other relief, as is allowed by law. The
arbitrator has no authority or jurisdiction to enter
any
award
that
is
not
in
conformance
with
controlling law. Any party to this agreement who
fails or refuses to arbitrate in accordance with the
terms of this agreement may, in addition to any
other relief awarded, be taxed by the arbitrator
with the costs, including reasonable attorney's
fees, of any other party who had to resort to
judicial or other relief in compelling arbitration.
In the event the dealer and the undersigned
customer(s) have entered into more than one
arbitration agreement concerning any of the matters
identified herein, the undersigned customers and the
dealer agree that the terms of this arbitration
agreement shall control disputes between and among
them. Any provision in this Agreement found to be
in conflict with any procedure promulgated by the
AAA which shall affect its administration of
disputes hereunder, shall be considered severed
herefrom. With respect to the process of arbitration
under the AAA Commercial Rules or Consumer Protocol,
the undersigned customer(s) and the dealer expressly
recognize that the rules and protocol and the terms
of this agreement adequately protect their abilities
to fully and reasonably pursue their respective
statutory and other legal rights. If for any reason
the AAA fails or refuses to administer the
arbitration of any dispute brought by any party to
this agreement, the parties agree that all disputes
will then be submitted to binding arbitration before
the Better Business Bureau (the BBB) serving the
community where the Dealer conducts business, under
the BBB binding arbitration rules. ... This
agreement
shall
survive
any
termination,
cancellation,
fulfillment,
including,
but
not
limited to cancellation due to lack of acceptable
financing or funding of any retail installment
contract
or
lease.
Further
information
about
7
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
arbitration can be obtained directly from the AAA or
from a review of AAA's Commercial Dispute Resolution
Procedures and Consumer Protocol, and/or the BBB's
Binding Arbitration Rules, copies of which are
available without charge for review from the AAA and
the BBB. THE UNDERSIGNED HAVE AGREED TO WAIVE THE
UNDERSIGNED(S)' RIGHT TO A TRIAL BY JUDGE OR JURY IN
ALL DISPUTES OVER $10,000.00 AND THAT ARBITRATION
SHALL BE IN LIEU OF ANY CIVIL LITIGATION IN ANY
COURT AND IN LIEU OF ANY TRIAL BY JUDGE OR JURY FOR
ALL CLAIMS OVER $10,000.00. THE TERMS OF THIS
AGREEMENT AFFECT LEGAL RIGHTS. IF YOU DO NOT
UNDERSTAND ANY PROVISION OF THIS AGREEMENT OR THE
COSTS, ADVANTAGES OR DISADVANTAGES OF ARBITRATION,
SEEK INDEPENDENT ADVICE AND/OR REVIEW THE WRITTEN
CONSUMER
AND/OR
COMMERCIAL
DISPUTE
RESOLUTION
PROCEDURES AND PROTOCOLS AND/OR CONTACT THE AAA OR
BBB BEFORE SIGNING. BY SIGNING YOU ACKNOWLEDGE THAT
YOU HAVE READ, UNDERSTAND AND AGREE TO BE BOUND BY
EACH OF THE PROVISIONS, COVENANTS, STIPULATIONS AND
AGREEMENTS SET FORTH AND REFERENCED HEREIN ABOVE.
"DESCRIPTION
OF
PRODUCTS/SERVICES:
_______________"
(Capitalization in original; emphasis omitted; and emphasis
added.)
In the blank line following the "DESCRIPTION OF
PRODUCTS/SERVICES" typically was printed the year and
model of
the vehicle to be purchased, as well as the vehicle-
identification number ("VIN") of that vehicle. Below that
were blank lines for the date to be filled in and lines for
signatures of the customer and a dealer representative. In
two of the cases before us -- the complaints filed by
8
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
Jeffery Lollar and Betsy Lollar and by Anthony Hood -- there
are allegations that the arbitration agreements were altered
after the Lollars and Hood signed their agreements,
allegations that will be explained in more detail when we
discuss the facts of each case.
A. Case no. 1160435: Jeffery Lollar and Betsy Lollar
Jeffery Lollar and Betsy Lollar originally visited
Locklear CJD on May 28, 2013, and purchased a 2009 Dodge Ram
truck. In the course of doing so, they signed the arbitration
agreement. The Lollars again visited Locklear CJD in
December
2015
because
they
were
considering
purchasing
another
vehicle. In the course of exploring that option, they filled
out a credit application to see if they would qualify for a
loan. The Lollars ultimately decided to purchase a vehicle
from another dealership and, thus, did not sign an arbitration
agreement in connection with their 2015 visit to Locklear CJD.
Sometime after their 2015 visit to Locklear CJD, the
Lollars were informed by the Northport Police Department that
they had been the victims of identity theft. The Lollars
allege that Locklear CJD and Locklear Group, by and through
their employees, had represented to them when they provided
9
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
their personal information that their information would be
kept confidential. Instead, according to the Lollars,
Locklear
CJD
and
Locklear
Group
wrongfully
procured,
disclosed, disseminated, used, provided, and/or sold the
Lollars' personal information.
The Lollars filed a complaint in the Bibb Circuit Court
on October 7, 2016, against Locklear CJD, Locklear Group, and
other defendants.1 They asserted the following claims against
Locklear
CJD
and
Locklear
Group:
(1)
negligence;
(2) wantonness; (3) invasion of privacy; (4) conversion;
(5)
fraud-deceit,
suppression,
and
misrepresentation;
(6)
tort
of outrage; (7) civil conspiracy; (8) violation of Alabama's
Consumer Identity Protection Act; (9) "respondeat superior";
and (10) breach of fiduciary duty.
On October 28, 2016, Locklear CJD and Locklear Group
filed a joint motion to compel arbitration of all the Lollars'
claims against them. In support of the motion, they submitted
an affidavit from Christopher S. Locklear, Sr., who stated
1The other defendants were Verizon Communications, Inc.,
CellCo Partnership d/b/a Verizon Wireless, Verizon Credit,
Inc.,
Wireless
Advantage
Communications,
Inc.,
and
fictitiously named defendants A through H.
10
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
that he was the custodian of records at Locklear CJD and that
a copy of the arbitration agreement signed by the Lollars in
2013 was attached to his affidavit. The copy of the
arbitration agreement submitted with the motion to compel
arbitration contained the signatures of Jeffery Lollar and
Betsy Lollar, a signature of a dealer representative, the date
of the 2013 transaction, and in the space for "Description of
Products/Services" was printed "2009 RAM 1500" with an
accompanying VIN, followed by "LOCKLEAR CHRYSLER JEEP DODGE,
LLC." Locklear CJD and Locklear Group filed an amended motion
to compel on February 1, 2017.
On February 8, 2017, without the benefit of a response
from the Lollars or a hearing, the trial court entered an
order denying the motion to compel arbitration. The order did
not state a rationale for the decision. Locklear CJD and
Locklear Group filed a timely appeal of the trial court's
order denying their motion to compel arbitration.
B. Case no. 1160375: Anthony Hood
In November 2015, Anthony Hood visited Locklear CJD to
look at vehicles. On December 19, 2015, Hood purchased a 2016
11
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
Dodge Ram 3500 truck2 from Locklear CJD, and, in the course of
doing so, he signed the arbitration agreement. At that time,
Hood also completed a
credit application and provided Locklear
CJD with personal information. Like the Lollars, Hood alleged
that Locklear CJD represented to him that his information
would be kept confidential. In March 2016, Hood was informed
by the Northport Police Department that he was the victim of
identity theft.
On December 5, 2016, Hood filed his complaint in the Bibb
Circuit Court against Locklear CJD, Locklear Group, and other
defendants.3 He asserted the following claims against
Locklear
CJD
and
Locklear
Group:
(1)
negligence;
(2) wantonness; (3) invasion of privacy; (4) conversion;
(5)
fraud-deceit,
suppression,
and
misrepresentation;
(6)
tort
of outrage; (7) civil conspiracy; (8) violation of Alabama's
Consumer Identity Protection Act; (9) "respondeat superior";
2There is an immaterial discrepancy between Hood's
complaint and the arbitration agreement on the year of the
purchased vehicle, i.e., whether it was a 2015 or 2016 model.
3The other defendants were Verizon Communications, Inc.,
CellCo Partnership d/b/a Verizon Wireless, Verizon Credit,
Inc.,
Wireless
Advantage
Communications,
Inc.,
and
fictitiously named defendants A through H.
12
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
and (10) breach of fiduciary duty. In his complaint, Hood
recounted that he "purchase[d] a 2016 3500 Dodge Ram" truck
from Locklear CJD and that, in the course of doing so, he
"completed a credit or financial application" provided by
"Locklear Dodge personnel." Hood filed a first amended
complaint on December 12, 2016, to correct his legal name in
the party references.
Locklear CJD and Locklear Group filed a joint motion to
compel arbitration on December 12, 2016. In support of the
motion, they submitted an affidavit from Christopher S.
Locklear, Sr., who stated that he was the custodian of records
at Locklear CJD and that a copy of the arbitration agreement
signed by Hood was attached to his affidavit. The copy of the
arbitration agreement submitted with the motion to compel
arbitration contained Hood's signature on a line designated
"CUSTOMER," a signature of a dealer representative on a line
designated "DEALER," and the date of the transaction. In the
space
for
"Description
of
Products/Services" was
printed
"2015
RAM 3500" and a VIN. Immediately above the "DEALER" signature
line was typed or printed "LOCKLEAR CHRYSLER JEEP DODGE, LLC."
13
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
On January 18, 2017, Hood filed a response in opposition
to the motion to compel arbitration. Hood's response again
stated that, "[a]round November 2015, [Hood] purchased a 3500
Dodge Ram at Locklear Chrysler Jeep Dodge, LLC," and that he
"signed a Pre-Dispute Arbitration Agreement pertaining to the
vehicle." In support of his response, Hood filed his own
affidavit in which he testified:
"3. I did not sign the Arbitration Agreement
attached to Locklear Defendants' Motion to Stay.
"4. The words 'Locklear Chrysler Jeep Dodge, LLC'
at the bottom of the agreement are different typeset
than the rest of the agreement and not part of an
original document.
"5. A copy of the only agreement presented and
given to me is attached to this Affidavit. Someone
altered the original to add the words 'Locklear
Chrysler Jeep Dodge, LLC' after the fact and filed
the altered agreement in Court with the Locklear
Defendants' Motion."
The version of the arbitration agreement Hood attached to
his affidavit is a "blank form" of the agreement in that it
contains no signatures, no date, and no description of the
purchased vehicle. At the bottom, however, it does contain
signature lines designated for the "DEALER" and for the
"CUSTOMER." It comports with the foregoing averments in that
14
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
it does not bear the typed or printed words "LOCKLEAR CHRYSLER
JEEP DODGE, LLC."
On the other hand, a version of the arbitration agreement
Hood attached as an exhibit to his appellate brief and
represented by Hood in his brief to be a copy of the actual
agreement is signed. It bears Hood's signature as "CUSTOMER,"
the signature of a representative of the "DEALER," the date of
the transaction, and the make, model, and VIN of the subject
vehicle. This version likewise comports with the averments
above, i.e, it does not contain the typed or printed words
"LOCKLEAR CHRYSLER JEEP DODGE, LLC."
On January 23, 2017, the trial court heard oral arguments
on the motion to compel arbitration and, on the same date,
entered an order denying the motion. The order did not state
a rationale for the decision, except to note that the
"[f]indings [are] made orally in the record." The order was
issued by the same circuit judge who entered the order in the
Lollars' case. In the hearing on the motion to compel
arbitration, the trial court explained its decision as
follows:
15
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
"THE COURT: Okay. Well, I got it. Well, what I'm
kind of stuck on is the nexus of the actions to the
thing. And, of course, even listening to all that,
it seems like to me, the nexus is not there for --
because this is a -- looks like a totally separate
and independent matter. And, of course, the
question does, though, become and it's going to be
another question and, maybe, to deal with on a
motion -- on a summary judgment issue later on is
whether or not the dealership should be held
responsible for somebody else's independent criminal
actions, that's a whole other issue. But I'm going
to deny the motion for arbitration because seems
like that's a totally separate issue. It really is
in my opinion. And so -- and, of course, if my
bosses see otherwise. I'll go along with whatever
they say. But I really think that it's a separate
issue. Of course -- but the meat gets down to
whether or not the dealership is going to be liable.
I have to see whether there's enough evidence to
connect that to it. Now I don't know. But that's
something right now. But let's look at this -- I'm
going to deny the motion to arbitrate."
Locklear CJD and Locklear Group filed a timely appeal of
the trial court's order from the denial of their motion to
compel arbitration.
C. Case no. 1160335: Brad Hubbard
On November 18, 2015, Brad Hubbard visited Locklear CJD
and purchased a 2015 Jeep Grand Cherokee sport-utility
vehicle. In the course of doing so, he signed the arbitration
agreement. At that time, Hubbard also completed a credit
application
and
provided
Locklear
CJD
with
personal
16
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
information. In early 2016, Hubbard discovered that he was
the victim of identity theft.
On July 1, 2016, Hubbard filed a complaint in the
Tuscaloosa Circuit Court against Locklear CJD. Locklear CJD
filed a motion to compel arbitration on August 9, 2016. On
August 11, 2016, the trial court entered an order granting
Locklear CJD's motion. The following day Hubbard filed a
motion to set aside the order, but on August 29, 2016, he
withdrew his motion.
On August 22, 2016, Hubbard filed his first amended
complaint in which he added additional defendants, namely
Allen Bentley, Wireless Advantage Communications, Inc.,
Verizon Communications, Inc., and Verizon Credit, Inc., as
well as asserted additional claims. On October 12, 2016,
Hubbard filed a second amended complaint in which he added
Locklear Group as a defendant and asserted additional claims
against the defendants. The second amended complaint asserted
the following claims against all the named defendants,
including Locklear CJD and Locklear Group: (1) negligence;
(2) wantonness; (3) violation of Alabama's Consumer Identity
Protection Act; (4) conversion; (5) invasion of privacy; (6)
17
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
tort of outrage; (7) civil conspiracy; and (8) negligent
and/or
wanton
hiring,
retention,
supervision,
and/or
training.
Locklear Group filed a motion to compel arbitration on
October 13, 2016. On October 18, 2016, the trial court set
the motion for a hearing date of October 28, 2016. On
October 27, 2016, Hubbard filed a response in opposition to
the motion to compel arbitration. In his response, Hubbard
contended that Locklear Group could not enforce the
arbitration agreement because it was not a signatory to the
agreement and the language of the agreement was limited to the
signing parties -- Locklear CJD and Hubbard. Hubbard did not
oppose arbitration of his claims against Locklear CJD.
On December 27, 2016, the trial court entered an order
denying Locklear Group's motion to compel arbitration. In its
order, the trial court quoted a portion of the arbitration
agreement and then stated:
"This arbitration provision is broad in the
sense that it applies to 'any dispute' arising from
or related to 'any contracts or agreements.'
However, it is narrow in the sense that it applies
only to 'the undersigned and the dealer' or to
contracts entered into 'by the parties.' The
provision does not define 'dealer' or 'parties' in
such a way that would include Locklear [Group]. See
18
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
MTA, Inc. v. Merrill, Lynch, Pierce, Fenner, 114
So. 3d 27 (Ala. 2012).
"Accordingly, Locklear ... Group's Motion to
Stay and Compel Arbitration is due to be and hereby
is DENIED."
(Capitalization in original.)
Locklear Group filed a timely notice of appeal from the
trial court's order denying its motion to compel arbitration.4
D. Case no. 1160336: Jeremy Averette
On October 29, 2015, Jeremy Averette visited Locklear CJD
and purchased a 2016 Dodge Ram truck. In the course of doing
so, he signed the arbitration agreement. At that time,
Averette also completed a credit application and provided
Locklear CJD with personal information. On February 18, 2016,
Averette was notified by the Northport Police Department that
he was the victim of identity theft.
On June 27, 2016, Averette filed a complaint in the
Tuscaloosa Circuit Court against Locklear CJD. Locklear CJD
filed a motion to compel arbitration on August 9, 2016. On
4On February 8, 2017, this Court by order consolidated
this appeal with case no. 1160336 and case no. 1160337 for
purposes of filing the record and briefing.
19
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
August 29, 2016, the trial court entered an order granting
Locklear CJD's motion to compel arbitration.
On August 22, 2016, Averette filed his first amended
complaint in which he added additional defendants, namely
Allen Bentley, Wireless Advantage Communications, Inc.,
Verizon Communications, Inc., and Verizon Credit, Inc., as
well as asserted additional claims. On October 12, 2016,
Averette filed a second amended complaint in which he added
Locklear Group as a defendant and asserted additional claims
against the named defendants. The second amended complaint
asserted the following claims against all the named
defendants, including Locklear CJD and Locklear Group:
(1) negligence; (2) wantonness; (3) violation of Alabama's
Consumer
Identity
Protection Act;
(4)
conversion;
(5)
invasion
of privacy; (6) tort of outrage; (7) civil conspiracy; and
(8) negligent and/or wanton hiring, retention, supervision,
and/or training.
Locklear Group filed a motion to compel arbitration on
October 13, 2016. On October 17, 2016, the trial court set
the motion for a hearing date of October 19, 2016. On
October 18, 2016, Averette filed a response in opposition to
20
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
the motion to compel. In his response, Averette, like
Hubbard, contended that Locklear Group could not enforce the
arbitration agreement because it was not a signatory to the
agreement and the language of the agreement was limited to the
signing parties -- Locklear CJD and Averette. Averette did
not oppose arbitration of his claims against Locklear CJD.
On December 27, 2016, the trial court entered an order
denying Locklear Group's motion to compel arbitration. The
substantive language of the order, except for the name of the
plaintiff, was exactly the same as the order in Hubbard's
case, and it was issued by the same circuit judge.
Locklear Group filed a timely notice of appeal from the
trial court's order denying its motion to compel arbitration.
E. Case no. 1160337: Carol Fuller
On November 21, 2015, Carol Fuller visited Locklear CJD
and purchased a 2008 Toyota Avalon automobile. In the course
of doing so, she signed the arbitration agreement. At that
time, Fuller also completed a credit application and provided
Locklear CJD with personal information. In February 2016,
Fuller was notified by the Northport Police Department that
she was the victim of identity theft.
21
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
On October 7, 2016, Fuller filed a complaint in the
Tuscaloosa
Circuit
Court
against
Locklear
CJD,
Locklear
Group,
and other defendants, asserting the following claims:
(1) negligence; (2) wantonness; (3) violation of Alabama's
Consumer
Identity
Protection Act;
(4)
conversion;
(5)
invasion
of privacy; (6) tort of outrage; (7) civil conspiracy; and
(8) negligent and/or wanton hiring, retention, supervision,
and/or training.
On October 11, 2016, Locklear CJD and Locklear Group
filed a joint motion to compel arbitration. On October 26,
2016, the trial court set the motion for a hearing date of
October 28, 2016. On October 27, 2016, Fuller filed a
response in opposition to the motion to compel. In her
response, Fuller -- as did Averette and Hubbard -- contended
that Locklear Group could not enforce the arbitration
agreement because it was not a signatory to the agreement and
the language of the agreement was limited to the signing
parties -- Locklear CJD and Fuller. Fuller did not oppose
arbitration of her claims against Locklear CJD.
On December 27, 2016, the trial court entered an order
granting the motion to compel as to Locklear CJD but denying
22
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
it as to Locklear Group. Except for the name of the plaintiff
and references to Locklear CJD's motion to compel, the order
was substantively the same as the orders entered in Hubbard's
and Averette's cases, and it was issued by the same circuit
judge.
Locklear Group filed a timely notice of appeal from the
trial court's order denying the motion to compel arbitration
as to it.
F. Case no. 1160436: Elizabeth Booth
On December 7, 2015, Elizabeth Booth visited Locklear CJD
and purchased a 2015 Jeep Grand Cherokee sport-utility
vehicle. In the course of doing so, she signed the
arbitration agreement. At that time, Booth also completed a
credit application and provided Locklear CJD with personal
information. In January 2016, Booth was notified by the
Northport Police Department that she was the victim of
identity theft.
On October 7, 2016, Booth filed a complaint in the Bibb
Circuit Court against Locklear CJD, Locklear Group, and other
defendants, asserting the following claims: (1) negligence;
(2) wantonness; (3) violation of Alabama's Consumer Identity
23
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
Protection Act; (4) conversion; (5) invasion of privacy;
(6) tort of outrage; (7) civil conspiracy; and (8) negligent
and/or
wanton
hiring,
retention,
supervision,
and/or
training.
Locklear Group and Locklear CJD filed their joint motion
to compel arbitration on October 11, 2016. On November 9,
2016, Booth filed a response in opposition to the motion to
compel. In her response, Booth -- as did Fuller, Averette, and
Hubbard -- contended that Locklear Group could not enforce the
arbitration agreement because it was not a signatory to the
agreement and the language of the agreement was limited to the
signing parties -- Locklear CJD and Booth. Booth did not
oppose arbitration of her claims against Locklear CJD.
On January 31, 2017, the trial court held a hearing on
the motion to compel arbitration. On February 1, 2017, the
trial court denied the motion to compel as to Locklear Group,
but it granted the motion as to Locklear CJD. Except for the
name of the plaintiff, the order was substantively the same as
the order entered in Fuller's case, but it was issued by a
different circuit judge.
24
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
Locklear Group filed a timely notice of appeal from the
trial court's order denying the motion to compel arbitration
as to it.
G. Case no. 1160437: Dorothea Williams
On January 13, 2016, Dorothea Williams purchased a 2016
Chrysler 200 automobile from Locklear CJD. In the course of
doing so, she signed the arbitration agreement. At that time,
Williams also completed a credit application and provided
Locklear CJD with personal information. In February 2016,
Williams was notified by the Northport Police Department that
she had been the victim of identity theft.
On October 6, 2016, Williams filed her complaint in the
Bibb Circuit Court against Locklear CJD, Locklear Group, and
other
defendants,
asserting
the
following
claims:
(1) negligence; (2) wantonness; (3) violation of Alabama's
Consumer
Identity
Protection
Act;
(4)
conversion; (5)
invasion
of privacy; (6) tort of outrage; (7) civil conspiracy; and
(8) negligent and/or wanton hiring, retention, supervision,
and/or training.
Locklear Group and Locklear CJD filed their joint motion
to compel arbitration on October 11, 2016. On November 9,
25
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
2016, Williams filed a response in opposition to the motion to
compel. On January 23, 2017, Williams filed a supplemental
response to the motion. In her response, Williams -- as did
Hubbard, Averette, Fuller, and Booth -- contended that
Locklear Group could not enforce the arbitration agreement
because it was not a signatory to the agreement and the
language of the agreement was limited to the signing parties
-- Locklear CJD and Williams. Williams did not oppose
arbitration of her claims against Locklear CJD.
On January 31, 2017, the trial court held a hearing on
the motion. On February 1, 2017, the trial court granted the
motion to compel as to Locklear CJD but denied it as to
Locklear Group. Except for the name of the plaintiff, the
order was substantively the same as the orders entered in the
Fuller and Booth cases. It was issued by the same circuit
judge who decided Booth's case. Locklear Group filed a timely
notice of appeal from the trial court's order denying the
motion to compel arbitration as to it.
II. Standard of Review
"Our standard of review of a ruling denying a
motion to compel arbitration is well settled:
26
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
"'"This Court reviews de
novo the denial of a motion to
compel
arbitration.
Parkway
Dodge, Inc. v. Yarbrough, 779
So. 2d 1205 (Ala. 2000). A
motion to compel arbitration is
analogous to a motion for a
summary judgment. TranSouth Fin.
Corp. v. Bell, 739 So. 2d 1110,
1114 (Ala. 1999). The party
seeking to compel arbitration has
the
burden
of
proving
the
existence of a contract calling
for arbitration and proving that
the
contract
evidences
a
transaction affecting interstate
commerce. Id. '[A]fter a motion
to compel arbitration has been
made and supported, the burden is
on
the nonmovant
to
present
evidence
that
the
supposed
arbitration
agreement
is
not
valid or does not apply to the
dispute in question.' Jim Burke
Automotive, Inc. v. Beavers, 674
So. 2d 1260, 1265 n.1 (Ala. 1995)
(opinion
on
application
for
rehearing)."'
"Elizabeth Homes, L.L.C. v. Gantt, 882 So. 2d 313,
315 (Ala. 2003) (quoting Fleetwood Enters., Inc. v.
Bruno, 784 So. 2d 277, 280 (Ala. 2000))."
SSC Montgomery Cedar Crest Operating Co. v. Bolding, 130
So. 3d 1194, 1196 (Ala. 2013).
27
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
III. Analysis
A. Case no. 1160335: Brad Hubbard; case no. 1160336: Jeremy
Averette; case no. 1160337: Carol Fuller; case no. 1160436:
Elizabeth Booth; and case no. 1160437: Dorothea Williams
The arguments by the parties in the Hubbard, Averette,
Fuller, Booth, and Williams cases are identical,5 and so we
will address them together. As we observed in the rendition
of the facts, the trial courts in those cases determined that
the arbitration agreement "is broad in the sense that it
applies to 'any dispute' arising from or related to 'any
contracts or agreements.' However, it is narrow in the sense
that it applies only to 'the undersigned and the dealer' or to
contracts entered into 'by the parties.'" It was on this
premise that the trial courts concluded that the plaintiffs'
claims against Locklear CJD must be arbitrated but that their
claims against Locklear Group were not subject to arbitration
because Locklear Group was not a signatory to the arbitration
agreement. None of the plaintiffs in this group of appeals
objected to arbitration of their claims against Locklear CJD.
5Hubbard, Averette, Fuller, Booth, and Williams are all
represented by the same attorneys, and the argument sections
of their appellee briefs are substantively very similar.
28
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
1. Who Decides the Arbitrability of the Claims
Against Locklear Group?
We
have
stated
that
"[t]he
question
whether
an
arbitration provision may be used to compel arbitration of a
dispute between a nonsignatory and a signatory is a question
of substantive arbitrability (or, under the Supreme Court's
terminology,
simply
'arbitrability')."
Anderton
v.
Practice-Monroeville, P.C., 164 So.
3d
1094, 1101 (Ala. 2014).
"A
court
decides
issues
of
substantive
arbitrability
'[u]nless
the parties clearly and
unmistakably provide otherwise.'" Id.
(quoting AT&T Techs., Inc. v. Communications Workers of
America, 475 U.S. 643, 649 (1986)).
On appeal, Locklear Group contends that clear and
unmistakable evidence that the parties intended to arbitrate
issues of arbitrability exists in the arbitration agreement.
Specifically, it cites the following language in the
arbitration agreement:
"The undersigned agree that all disputes ...
resulting from, arising out of, relating to or
concerning the transaction entered into or sought to
be entered into (including but not limited to: ...
the terms of this agreement and all clauses herein
contained, their breadth and scope, ... shall be
submitted to BINDING ARBITRATION ...."
29
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
(Capitalization in original; emphasis added.)
In support of this contention, Locklear Group observes
that in Jim Burke Automotive, Inc. v. McGrue, 826 So. 2d 122
(Ala. 2002), this Court evaluated an arbitration agreement
that contained identical language as to arbitrability.
Specifically,
"[t]he
single-page
arbitration
agreement
provide[d] that the arbitrator decides 'the terms of this
agreement and all clauses herein contained, their breadth and
scope.'" 826 So. 2d at 132. The McGrue Court concluded that
"[t]he language of the arbitration agreement is clear and
unmistakable evidence indicating that McGrue and Jim Burke
intended to arbitrate the question of arbitrability." Id.
Likewise, in Ex parte Waites, 736 So. 2d 550 (Ala. 1999),
the
Court examined an arbitration agreement that contained the
same language on arbitrability:
"The arbitration provision included in the contract
entered into by the parties states that the parties
agree to arbitrate any disputes 'resulting from or
arising out of the sale transaction entered into
(including but not limited to: the terms of this
agreement and all clauses herein contained, their
breadth and scope ....'"
736 So. 2d at 552. The Waites Court concluded that "[t]his
language expresses a clear intent to submit to arbitration the
30
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
issue of arbitrability." Id. See also Title Max of
Birmingham, Inc. v. Edwards, 973 So. 2d 1050, 1054–55 (Ala.
2007) (concluding that an arbitration agreement that provided
that the parties agreed to arbitrate "'all claims, disputes,
or controversies arising from or relating directly or
indirectly to the signing of this Arbitration Provision, [and]
the validity and scope of this Arbitration Provision'"
"demonstrates that the parties intended to arbitrate whether
the agreement applies to 'any disputes that arose from their
relationship'").
For their part, the plaintiffs in these five appeals do
not directly challenge the Locklear Group's position that
language in the arbitration agreement sufficiently expresses
an intention to arbitrate issues of arbitrability. Instead,
they argue that Locklear Group did not sufficiently assert
this position in the trial courts and that, therefore, it
cannot serve as a basis for reversing the trial courts'
orders. The plaintiffs observe that all of Locklear Group's
motions to compel arbitration (which are substantially
identical in all the cases before us)
31
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
"consisted of six pages and fourteen numbered
paragraphs. The motions contained only one sentence
on the topic of who should decide disputes
concerning the scope of the arbitration agreements.
Specifically, the last sentence of paragraph 10 of
the motions states[:] 'Additionally, the scope and
breadth of this arbitration agreement is, by its
terms, to be determined by the arbitrator.' This
sentence was not followed by a citation to any legal
authority."
The plaintiffs in these five appeals note that "[t]his
Court has long held that it 'will not hold a trial court to be
in error unless that court has been apprised of its alleged
error and has been given the opportunity to act thereon.'"
Moultrie v. Wall, 172 So. 3d 828, 840 (Ala. 2015) (quoting Sea
Calm Shipping Co. v. Cooks, 565 So. 2d 212, 216 (Ala. 1990)).
They argue that the solitary sentence in the motions to compel
was not sufficient to apprise the trial courts that
arbitrability issues
--
including
Locklear
Group's
ability,
as
a nonsignatory, to enforce the arbitration agreement -- had to
be decided by the arbitrator. The plaintiffs contend that the
sentence is a quintessential example of an "undelineated
general
proposition[]
not
supported by
sufficient authority
or
argument." White Sands Grp., LLC v. PRS II, LLC, 998 So. 2d
1042, 1058 (Ala. 2008). The plaintiffs cite multiple cases in
32
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
which this Court concluded that a solitary reference to an
argument in a motion before the trial court was not sufficient
to raise the issue sought to be raised on appeal. See, e.g.,
Knight v. Alabama Power Co., 580 So. 2d 576, 578 (Ala. 1991)
(noting that "except for the one sentence requesting the trial
court to adopt the doctrine of comparative negligence, Knight
presented nothing in the way of argument on that issue. ...
This issue was not sufficiently argued to the trial court
...."); TFT, Inc. v. Warning Sys., Inc., 751 So. 2d 1238, 1243
(Ala. 1999), overruled on other grounds by Holiday Isle, LLC
v. Adkins, 12 So. 3d 1173 (Ala. 2008) (holding that an
unsuccessful bidder for a public contract could not argue on
appeal that the invitation to bid was ambiguous because it
"did not raise this argument in the trial court" where "[t]he
only mention of ambiguity TFT made at trial came in one
sentence of TFT's trial brief"); and Birmingham Hockey Club,
Inc. v. National Council on Compensation Ins., Inc., 827
So. 2d 73, 81 (Ala. 2002) (observing that the plaintiff's only
argument regarding the applicability of a six-year statute of
limitations was one sentence in a three-page motion and
concluding that "[i]t can hardly be said that [the plaintiff]
33
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
has presented this argument to the trial court and opposing
parties so as to give them an opportunity to address this
issue").
In the Booth and Williams appeals, Locklear Group
responds that, in addition to the sentence in its motion to
compel arbitration, it also raised the issue of arbitrability
in the hearings on those motions.6 Booth and Williams have
filed motions to strike Locklear Group's references and
arguments to statements it might have made in the hearings in
the Booth and Williams cases, observing that no transcript of
those hearings was made and so there is no evidence in the
record concerning what was argued in those hearings. Booth
and Williams further observe that Locklear Group could have
submitted a statement under Rule 10(d), Ala. R. App. P.,
recounting its recollection of what was argued in the hearings
if it had wanted those statements to be included as evidence
before this Court, but it failed to do so.7 Finally, Booth
6Locklear Group does not argue that it presented the
arbitrability argument in the hearings in the Hubbard,
Averette, and Fuller cases.
7Rule 10(d), Ala. R. App. P., states, in part: "If no
report of the evidence or proceedings at a hearing or trial
was made, or if a transcript is unavailable, the appellant may
34
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
and Williams cite multiple cases in which this Court has
refused to allow a party unilaterally to alter or supplement
the record through statements in an appellate brief. See,
e.g., Jim Parker Bldg. Co. v. G & S Glass & Supply Co., 69 So.
3d 124, 134 (Ala. 2011) (noting that "because the hearing in
this case was not transcribed, nothing presented at that
hearing may form the basis for reversing the trial court's
denial of Parker's motion to compel arbitration"); Bechtel v.
Crown Cent. Petroleum Corp., 451 So. 2d 793, 795 (Ala. 1984)
(observing that the appellant "states that estoppel was
raised
in oral argument at the hearing on the motion for summary
judgment. However, no transcription of that hearing is
included in the record. This court is limited to a review of
the record alone and the record cannot be changed, altered, or
varied on appeal by statements in briefs of counsel.").
In its responses to the motions to strike, Locklear Group
admits that "there is no record of the oral argument," that
"no steps were taken to create a statement of what occurred at
the hearing[s]," and that Booth and Williams "correctly
prepare a statement of the evidence or proceedings from the
best
available
means,
including
the
appellant's
recollection."
35
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
present[] the case law on this issue." Accordingly, we grant
the
motions to strike Locklear Group's references to
arguments
it allegedly made in the hearings on its motions to compel
arbitration in the Booth case and the Williams case. Thus, as
in the Hubbard, Averette, and Fuller cases, the only reference
to arbitrability in the trial courts in the Booth and Williams
cases was the single statement in Locklear Group's motion to
compel arbitration.
We agree with the plaintiffs that Locklear Group's
solitary statement in its motion to compel arbitration that
the arbitrator should decide the arbitrability of the claims
against it was not sufficient to apprise the trial court that
Locklear Group was relying on that argument. The first three
numbered paragraphs in the motion set out facts relevant to
the issue of arbitration, including quotations of substantial
portions of the arbitration agreement. The next three
paragraphs argued that the transaction at issue affected
interstate commerce. The following four paragraphs --
including paragraph 10, which contains the one sentence
referencing arbitrability of the arbitration issue -- argued
that the language of the arbitration agreement was broad
36
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
enough to include the subject matter of the underlying claims
asserted by the plaintiffs. Paragraph 10 stated:
"Arbitration
contracts
cannot
be
singled
out
and
be subjected to any different or more stringent
rules
of
construction
than
other
contracts.
Doctor's Associates, Inc. v. Casarotto, 517 U.S. 681
(1996). As plainly demonstrated by its language,
the
arbitration
agreement
in
this
case
is
sufficiently broad in scope to require arbitration
of all disputes relating to:
"'the resolution of any dispute arising out
of,
relating
to,
resulting
from
or
concerning any contracts or agreements ...
entered into by the parties, all alleged
representation, promises and covenants,
issues
concerning
compliance
with
any
state
or federal law or regulation ...[,] any
matters taking place either before or after
the parties entered into this agreement
...[,] the terms of this agreement and all
clauses
herein
contained,
their
breadth
and
scope ...'
"(Exhibit A). The present case clearly arises out
of and relates to the Plaintiff's purchase of the
[vehicle] at issue, events taking place before and
after the parties entered into the agreement, the
dealership's compliance with state and/or federal
law or regulations and alleged misrepresentations
and/or
omissions
of
Locklear
in
connection
therewith. Additionally, the scope and breadth of
this arbitration agreement is, by its terms, to be
determined by the arbitrator."
The next paragraph argued that courts have a duty under the
Federal Arbitration Act to "rigorously enforce agreements to
37
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
arbitrate." The final few paragraphs stated the relief
Locklear Group requested (i.e., that the trial court "should
compel the Plaintiff to submit his dispute to binding
arbitration, ... and all Court actions, including discovery,
should be stayed pending arbitration") without any reference
to having the arbitrator decide the issue of arbitrability.
When the motion to compel arbitration is read as a whole,
it is clear that Locklear Group did not articulate why the
question of the arbitrability of the claims against it should
be submitted to the arbitrator. Its overriding argument was
devoted to the merits of the issue whether the arbitration
agreement is broad enough to encompass the plaintiffs'
underlying claims against Locklear Group even though Locklear
Group was not a signatory to the arbitration agreement, not to
the proposition that the arbitrator, and not the court, should
decide this issue. Except for the brief reference in
paragraph 10, Locklear Group never mentioned arbitration of
the arbitrability issue anywhere in its motion, including in
its paragraphs specifying the relief it was requesting from
the trial courts. Locklear Group's single, unsupported, and
unexplained sentence in this regard contrasts sharply with its
38
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
relatively fulsome discussion in its motion as to the breadth
of the language of the arbitration agreement and how this
language was sufficient to entitle Locklear Group to
arbitrate
the
plaintiffs' underlying claims (not to mention the
contrast
with the Locklear Group's thoroughly explained position on
the
subject of arbitrability in its brief on appeal to this
Court). Indeed, by focusing essentially all of its attention
on whether the language of the arbitration agreement was broad
enough to cover the plaintiffs' claims against it, Locklear
Group suggested that that was the dispositive issue and that
it was for trial court to decide it.8
Locklear Group contends that the fact that it argued to
the trial courts that the scope of the arbitration agreement
was broad enough to cover claims asserted by the plaintiffs
and that it also mentioned the arbitrability of that issue
constituted the presentation of two arguments in the
8A fair question exists, albeit one we need not address
further, as to whether the trial courts' error could be said
to have been invited under the circumstances. A party "'"may
not predicate an argument for reversal on 'invited error,'
that is, 'error into which he has led or lulled the trial
court.'"'" White Sands Grp., L.L.C. v. PRS II, LLC, 998
So. 2d at 1057 (quoting Mobile Infirmary Med. Ctr. v. Hodgen,
884 So. 2d 801, 808 (Ala. 2003), quoting other cases).
39
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
alternative.
The plaintiffs note, however, that the
arguments
"were not framed as alternative arguments." Instead, the
arbitrability statement is tacked as an afterthought to
Locklear Group's central claim that emphasized the broad scope
of the arbitration agreement.
Based on the foregoing, we conclude that, in the Hubbard,
Averette, Fuller, Booth, and Williams cases, Locklear Group
waived the issue whether the arbitration agreement by its
terms assigns the issue of the arbitrability of the
plaintiffs' claims against Locklear Group to the arbitrator
for decision.
2. The Arbitrability of the Plaintiffs' Claims
Against Locklear Group
Having concluded that it was for the courts to decide the
arbitrability of the underlying claims made by Hubbard,
Averette, Fuller, Booth, and Williams against Locklear Group,
we now consider whether the trial courts correctly decided
that issue. Whether they did so turns on the proper
application
of
the
so-called
"equitable-estoppel
exception"
to
the general rule that an arbitration agreement binds only the
signatories to that agreement.
40
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
a. The Exception to Equitable Estoppel for
"Party Specific" Language
Locklear Group argues that, despite the fact that it is
not a signatory to the arbitration agreement, the plaintiffs
"are equitably estopped from arguing that their claims against
Locklear Group are not subject to arbitration."
"A party typically manifests its assent to
arbitrate a dispute by signing the contract
containing the arbitration provision. Ex parte
Stamey, 776 So. 2d 85, 88–89 (Ala. 2000). One of
the key exceptions to this rule is the theory of
equitable estoppel, under which a nonsignatory can
enforce an arbitration provision when the claims
against the nonsignatory are '"'intimately founded
in and intertwined with'"' the underlying contract
obligations. Stamey, 776 So. 2d at 89 (quoting
Sunkist Soft Drinks, Inc. v. Sunkist Growers, Inc.,
10 F.3d 753, 757 (11th Cir. 1993), quoting in turn
McBro Planning & Dev. Co. v. Triangle Elec. Constr.
Co., 741 F.2d 342, 344 (11th Cir. 1984))."
Smith v. Mark Dodge, Inc., 934 So. 2d 375, 380 (Ala. 2006).
This Court has, however, crafted an exception to this
equitable-estoppel exception: "Where 'the language of the
arbitration provisions limited arbitration to the signing
parties,' this Court has not allowed the claims against the
nonsignatories to be arbitrated." Id. at 380-81 (quoting
Stamey, 776 So. 2d at 89). In other words,
41
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
"[i]f an arbitration agreement is written in
broad language so that it applies to '[a]ll
disputes, claims or controversies arising from or
relating to this Contract or the relationships which
result from this Contract,' Ex parte Napier, 723
So. 2d 49, 51 (Ala. 1998) (emphasis added), or even
in slightly narrower language so that it applies to
'ALL DISPUTES, CLAIMS OR CONTROVERSIES ARISING FROM
OR RELATING TO THIS CONTRACT OR THE PARTIES
THERETO,' Stamey, 776 So. 2d at 91 (capitalization
in original; emphasis added), this Court will
proceed to determine whether arbitration may be
compelled under the doctrine of equitable estoppel.
"Conversely, if the language of the arbitration
provision is party specific and the description of
the parties does not include the nonsignatory, this
Court's inquiry is at an end, and we will not permit
arbitration of claims against the nonsignatory. See
Jim Burke Auto., Inc. v. McGrue, 826 So. 2d 122, 131
(Ala. 2002) (affirming the trial court's order
denying
a
nonsignatory's
motion
to
compel
arbitration where the arbitration agreement was
between 'you [a signatory plaintiff] and us [a
signatory defendant] or our employees, agents,
successors or assigns') (bracketed language added);
Ex parte Lovejoy, 790 So. 2d 933, 938 (Ala. 2000)
(issuing a writ of mandamus directing a trial court
to enter an order denying a nonsignatory's motion to
compel arbitration where the arbitration provision
was limited to 'all disputes or controversies
between you [Lovejoy] and us [Allen Motor Company
and
its
assignees]')
(bracketed
language
and
emphasis in original); First Family Fin. Servs. v.
Rogers, 736 So. 2d 553, 560 (Ala. 1999) (reversing
a trial court's order granting a nonsignatory's
motion to compel arbitration where 'you [the
plaintiffs] and we [First Family]' agreed to
arbitrate and the arbitration provision elsewhere
stated that it applied to 'all claims and disputes
between you [the plaintiffs] and us [First Family],'
42
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
and furthermore stated that it applied to 'any claim
or dispute ... between you [the plaintiff] and any
of our [First Family's] employees or agents, any of
our affiliate corporations, and any of their
employees or agents') (bracketed language and
emphasis in original); and Med Center Cars[, Inc. v.
Smith], 727 So. 2d [9] at 19 [(Ala. 1998)]
(affirming
a
trial
court's
order
denying
nonsignatories' motions to compel arbitration where
the arbitration provisions were limited to disputes
and controversies 'BETWEEN BUYER AND SELLER')
(capitalization in original)."
934 So. 2d at 381.
The plaintiffs in this group of appeals contend that the
arbitration
agreement was
limited
to
controversies
between
the
signatories -- Locklear CJD and each plaintiff -- and thus
that Locklear Group, as a nonsignatory, cannot enforce the
arbitration agreement against the signatory plaintiffs. The
plaintiffs highlight references in the arbitration agreement
to "any party" or "the undersigned" or "the dealer." The
trial courts' orders did the same. In this regard, the trial
courts' orders set out the following passage, which they
attribute to the arbitration agreement:
"'In
connection with
the
undersigned's
acquisition
or
attempted
acquisition
of
the
below described vehicle, by lease, rental,
purchase or otherwise, the undersigned and
the dealer whose name appears below,
stipulate and agree, in connection with the
43
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
resolution of any dispute arising out of,
or
relating
to,
resulting
from
or
concerning any contracts or agreements, or
agreements or contracts to be entered into
by the parties .... shall be submitted to
BINDING ARBITRATION.'"
(Capitalization in original; ellipses supplied by the trial
courts.)
The plaintiffs argue that "[c]ontract language cannot get
much more 'party specific' than [that found in the arbitration
agreements]. There is no hint that the agreements are
intended to cover claims against nonsignatories." The
plaintiffs in particular emphasize a passage of the
arbitration agreement that states that "the undersigned
customer[s] and the dealer agree that the terms of this
arbitration agreement
shall
control
disputes
between
and
among
them." About this passage, the plaintiffs state: "Even aside
from all the other party-specific language in the agreements,
this language makes it clear that the agreements were intended
to control disputes between and among the signatories, with no
indication whatsoever that the agreements control any other
dispute."
44
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
As Locklear Group observes, however, neither the
plaintiffs nor the trial courts fully and accurately quote the
operative language of the arbitration agreement.
First, as to the sentence of the arbitration agreement
emphasized by the plaintiffs, that sentence actually states in
full as follows: "In the event the dealer and the undersigned
customer(s) have entered into more than one arbitration
agreement concerning any of the matters identified herein, the
undersigned customers and the dealer agree that the terms of
this arbitration agreement shall control disputes between and
among them." Obviously, the purpose of this statement is
simply to address which of two arbitration agreements would
control disputes between the parties if the parties have
entered into more than one such agreement related to the
subject transactions.
As to the above-quoted passage from the trial courts'
orders, that passage conflates two separate sentences from the
arbitration agreement. The first sentence, which in the
arbitration agreement ends within the portion of the passage
for which the trial courts substituted an ellipses, actually
reads in its entirety as follows:
45
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
"In connection with the undersigned's acquisition or
attempted
acquisition
of
the
below
described
vehicle, by lease, rental, purchase or otherwise,
the undersigned and the dealer whose name appears
below, stipulate and agree, in connection with the
resolution of any dispute arising out of, or
relating to, resulting from or concerning any
contracts or agreements, or agreements or contracts
to be entered into by the parties, all alleged
representations, promises and covenants, issues
concerning compliance with any state or federal law
or regulation, and all relationships resulting
therefrom, as follows: That the vehicle, services,
and products (hereinafter 'products') involved in
the
acquisition
or
attempted
acquisition
are
regulated by the laws of the United States of
America; and/or, that the contract(s) and agreements
entered into by the parties concerning said products
evidence transactions and business enterprises
substantially involving and affecting interstate
commerce sufficiently to invoke the application of
the Federal Arbitration Act, 9 U.S.C. § 1, et seq."
This sentence merely states that "the undersigned and the
dealer ... stipulate and agree" that the transactions and
agreements "are regulated by the laws of the United States of
America" and that "agreements entered into by the parties
concerning said products evidence transactions and business
enterprises substantially involving and affecting interstate
commerce sufficiently to invoke the
application of the Federal
Arbitration Act, 9 U.S.C. § 1, et seq." In short, this
sentence does nothing more than express the agreement of the
46
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
parties that federal arbitration law is applicable to the
arbitration agreement.
The second sentence, part of which the trial courts added
to the above-quoted passage following the ellipses, is in fact
the operative part of the agreement for present purposes. But
that sentence actually begins as follows:
"The undersigned agree that all disputes not barred
by applicable statutes of limitations, resulting
from, arising out of, relating to or concerning the
transaction entered into or sought to be entered
into (including but not limited to: any matters
taking place either before or after the parties
entered into this agreement, including any prior
agreements or negotiations between the parties; the
terms of this agreement and all clauses herein
contained, their breadth and scope, and any term of
any agreement contemporaneously entered into by the
parties; the past, present and future condition of
any products at issue; the conformity of the
products
to
any
contract
description;
the
representations, promises, undertakings, warranties
or covenants made by the dealer, its agents,
servants, employees, successors and assigns, or
otherwise dealing with the products; any lease, sale
or rental terms or the terms of credit and/or
financing in connection therewith; or compliance
with any state or federal laws; any terms or
provisions of any insurance sought to be purchased
or purchased simultaneously herewith; any terms or
provisions of any extended service contract to be
purchased or purchased simultaneously herewith)
shall be submitted to BINDING ARBITRATION ...."
(Emphasis added.)
47
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
Contrary to the suggestion by the trial courts, this
sentence in the arbitration agreement clearly is not "party
specific" in the sense described in Mark Dodge, but, as
emphasized, actually professes to be applicable to "all
disputes" arising from the transaction and related matters.
There is no language in this passage that restricts the
disputes covered by the arbitration agreement to claims
between the parties.9
The operative arbitration language in the arbitration
agreement is similar to the language in the arbitration
agreement in Ex parte Napier, 723 So. 2d 49, 51 (Ala. 1998),
which provided that "'[a]ll disputes, claims or controversies
arising from or relating to this Contract or the relationships
which result from this Contract ... shall be resolved by
9We note that Hubbard, Averette, Fuller, Booth, and
Williams -- unlike the Lollars and Hood -- do not contend that
the substantive nature of their identity-theft claims, rather
than the nature of the parties against whom those claims are
made, is such that the language of the arbitration agreement
is not broad enough to encompass those claims. Such a
contention would be difficult for Hubbard, Averette, Fuller,
Booth, and Williams to maintain, given that they did not
oppose Locklear CJD's motion for arbitration of the
plaintiffs' similar identity-theft claims against it, which
motion
was
based
on
the
same
substantive arbitration-agreement
language.
48
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
binding arbitration.'" The Napier Court concluded that this
language was "broad enough to encompass Napier and Godfrey's
claims against [nonsignatories] Foremost and Manning." Id.
at
53.
The operative arbitration language in the arbitration
agreement in these cases is also nearly identical to the
language in the arbitration agreement at issue in Volkswagen
Group of America, Inc. v. Williams, 64 So. 3d 1062, 1064 (Ala.
Civ. App. 2010), which provided: "'The undersigned agree that
all disputes ... resulting from or arising out of or relating
to or concerning the transaction entered into ... shall be
submitted to BINDING ARBITRATION ....'" In Williams, the
Court of Civil Appeals disagreed with the plaintiff's
contention that
"the
arbitration
clause
at
issue
is
'party
specific.' The clause, rather, speaks to 'all
disputes ... resulting from or arising out of or
relating to or concerning the transaction,' a
formulation
that
closely
parallels
the
broad
language recognized by the Alabama Supreme Court in
Smith v. Mark Dodge, Inc., 934 So. 2d 375 (Ala.
2006), as authorizing a nonsignatory to assert a
right to compel arbitration through application of
equitable estoppel ...."
Id. at 1065.
49
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
To
reiterate,
when
"references
[in
arbitration
provisions] to the parties specifically limited the claims
that would be arbitrable under those provisions," the Court
has concluded that the arbitration provisions "'are not broad
enough to encompass claims against the nonsignatories.'"
Ex parte Stamey, 776 So. 2d 85, 90 (Ala. 2000) (quoting Med
Ctr. Cars, Inc. v. Smith, 727 So. 2d 9, 19 (Ala. 1998)). On
the other hand, this Court also has held that, when an
arbitration provision "contained no references to the parties
that would impose a limitation on what claims would be
arbitrated," the arbitration provision was broad enough to
include claims that were related to the contract because the
language was sufficient to indicate that "the party resisting
arbitration ha[d] assented to the submission of claims against
nonparties -- claims that otherwise would fall within the
scope of the arbitration provision -- to arbitration."
Stamey, 776 So. 2d at 89. Like the arbitration provisions in
Napier and Williams, the operative arbitration language in
the
arbitration agreement is not limited to claims between the
parties. Accordingly, Locklear Group has cleared this hurdle
to the invocation of the doctrine of equitable estoppel
50
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
against Hubbard, Averette, Fuller, Booth, and Williams. We
turn then to the central issue -- whether the plaintiffs'
claims
against
Locklear
Group,
a
nonsignatory,
are
sufficiently intertwined with their claims against Locklear
CJD, a signatory.
b. Sufficient Intertwining to Invoke Estoppel
As noted, a nonsignatory can enforce an arbitration
provision when the claims against the nonsignatory are
"intimately founded in and intertwined with" the underlying
contract obligations. Stamey, 776 So. 2d at 89. Smith v.
Mark Dodge, Inc., 934 So. 2d at 380. In Kenworth of Mobile,
Inc. v. Dolphin Line, Inc., 988 So. 2d 534 (Ala. 2008), this
Court
summarized the
intertwining analysis
provided
in
Service
Corp. International v. Fulmer, 883 So. 2d 621 (Ala. 2003):
"In Service Corp. International v. Fulmer, 883
So. 2d 621 (Ala. 2003), Blair Fulmer entered into a
contract with SCI Alabama Funeral Services, Inc.
('SCI-Alabama'), for the provision of funeral and
cremation services for his deceased mother. The
contract included an arbitration provision. After
Fulmer was given a vase that was supposed to have
contained his mother's remains but allegedly did
not, Fulmer sued SCI-Alabama and Service Corporation
International
('SCI'),
SCI-Alabama's
parent
corporation. The defendants filed a motion to
compel arbitration, which the trial court denied.
The defendants appealed.
51
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
"SCI argued that, even though it was not a
signatory to the contract containing the arbitration
agreement, 'Fulmer's claims against the signatory
defendant, SCI-Alabama, are so "intertwined" with
his claims against SCI that arbitration of all of
Fulmer's claims, including those against SCI, is
appropriate.' 883 So. 2d at 634. After noting
Stamey's two-part test, this Court addressed the
first part, which relates to whether the claims
against the nonsignatory defendant are intertwined
with the claims against the signatory defendant.
Finding that prong satisfied, this Court wrote:
"'Here, Fulmer's claims against SCI are
clearly
"intimately
founded
in
and
intertwined
with"
his
claims
against
SCI-Alabama.... All of Fulmer's claims
arise from the same set of facts. Virtually
none of Fulmer's claims makes a distinction
between the alleged bad acts of SCI (the
parent
corporation)
and
those
of
SCI-Alabama (its subsidiary); rather, the
claims
are
asserted
as
if
SCI
and
SCI-Alabama acted in concert.'
"883 So. 2d at 634."
988 So. 2d at 543.
Just as in Fulmer, all of the plaintiffs' claims against
Locklear Group in these cases are "intimately founded in" the
same facts as are their claims against Locklear CJD. The
plaintiffs' complaints make virtually no distinction between
the bad acts of Locklear Group and those of Locklear CJD.
Indeed, when the plaintiffs' complaints described purchasing
52
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
their vehicles, they stated that they "dealt with Locklear
[CJD] and/or Defendant Locklear [Group] employee[s]" and
"[t]he Defendant Locklear [CJD] and/or Defendant Locklear
[Group] ran a credit check on" each plaintiff. Every claim
the plaintiffs asserted against Locklear CJD they also
asserted against Locklear Group, and those claims were
asserted as if Locklear CJD and Locklear Group had acted in
concert, as if the latter was responsible for the acts of the
former, and/or as if those persons who acted for one also
acted for the other. Therefore, we conclude that the
plaintiffs' claims against Locklear Group as a nonsignatory to
the arbitration agreement are "intimately founded in and
intertwined
with"
the
underlying contract
obligations
and
with
the plaintiffs' contract-related claims against the signatory
to the arbitration agreement, Locklear CJD, so that the
doctrine of equitable estoppel is applicable.
Based on the foregoing, Locklear Group can enforce the
arbitration agreement against Hubbard, Averette, Fuller,
Booth, and Williams; the trial courts in this group of cases
erred in denying Locklear Group's motions to compel
arbitration.
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1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
B. Case no. 1160435: Jeffery Lollar and Betsy Lollar
As to the Lollars, Locklear CJD and Locklear Group argue
that they met their prima facie burden so as to enforce the
arbitration agreement, having filed a joint motion in support
of which they submitted a contract calling for arbitration and
uncontradicted
evidence
that
the
transaction
affected
interstate commerce. They also note that it is undisputed
that the Lollars filed no response to their joint motion and
supporting evidence.
Accordingly, they contend that the
trial
court had no alternative but to grant their motion to compel
arbitration and that it erred in not doing so.
In support of their position, Locklear CJD and Locklear
Group cite a passage from this Court's opinion Ex parte
Greenstreet, Inc., 806 So. 2d 1203 (Ala. 2001):
"We hold that once a moving party has satisfied its
burden of production by making a prima facie showing
that an agreement to arbitrate exists in a contract
relating to a transaction substantially affecting
interstate commerce, the burden of persuasion shifts
to the party opposing arbitration. If that party
presents no evidence in opposition to a properly
supported motion to compel arbitration, then the
trial court should grant the motion to compel
arbitration."
806 So. 2d at 1209 (emphasis added).
54
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
The Lollars acknowledge that they failed to file a
response to the motion to compel arbitration. They assert
that failing to do so was an oversight that occurred because
their counsel was expecting the trial court to set the motion
to compel for a hearing just as it had done in two similar
cases (one of which is before us in these appeals, case no.
1160375 -- Hood). Instead, in this case the trial court did
not set a hearing; it simply entered an order denying
arbitration before the Lollars filed a response. In an
apparent attempt to rectify this oversight, the Lollars attach
to their brief on appeal their own affidavits and a copy of
what they contend was the actual arbitration agreement they
signed.
Locklear CJD and Locklear Group have rejoined with a
motion to strike the attachments to the Lollars' brief as well
as all references in their brief to those documents. As they
note, this Court cannot consider evidence that is not part of
the record on appeal.
"'"[A]ttachments to briefs are not considered part
of the record and therefore cannot be considered on
appeal."' Morrow v. State, 928 So. 2d 315, 320 n. 5
(Ala. Crim. App. 2004) (quoting Huff v. State, 596
So. 2d 16, 19 (Ala. Crim. App. 1991)). Further, we
55
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
cannot consider evidence that is not contained in
the record on appeal because this Court's appellate
review '"is restricted to the evidence and arguments
considered by the trial court."' Ex parte Old
Republic Sur. Co., 733 So. 2d 881, 883 n.1 (Ala.
1999) (quoting Andrews v. Merritt Oil Co., 612 So.
2d 409, 410 (Ala. 1992) ...)."
Roberts v. NASCO Equip. Co., 986 So. 2d 379, 385 (Ala. 2007).
Locklear CJD and Locklear Group are correct. We do not
consider the evidence submitted by the Lollars on appeal or
their arguments based on that evidence because that evidence
and those arguments were not presented to the trial court;
accordingly, we grant the motion to strike that evidence.
Contrary to Locklear CJD and Locklear Group's argument,
however, the Lollars' lack of response does not end our
inquiry. It is true that, "once a moving party has satisfied
its burden of production by making a prima facie showing that
an agreement to arbitrate exists in a contract relating to a
transaction substantially affecting interstate commerce," the
burden shifts to the nonmoving party to show otherwise.
Ex parte Greenstreet, Inc., 806 So. 2d at 1209 (emphasis
added). It is likewise true that this Court has said that,
"[i]f th[e nonmoving] party presents no evidence in
opposition
to a properly supported motion to compel arbitration, then the
56
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
trial court should grant the motion to compel arbitration."
Ex parte Greenstreet, Inc., 806 So. 2d at 1209 (emphasis
added). Implicit in this standard is that we must evaluate
whether the motion to compel arbitration does make a "prima
facie showing" that the parties entered into an agreement to
arbitrate the dispute in question and that this showing was
"properly supported" by evidence of such an agreement. As we
have otherwise recently expressed in another case in which the
party opposing arbitration failed to present evidence in the
trial court: "[U]nless on its face the arbitration provision
is not valid or does not apply to the dispute in question, the
trial court's decision to deny the motions to compel
arbitration was erroneous." Family Sec. Credit Union v.
Etheredge, [Ms. 1151000, May 19, 2017] ___ So. 3d ___ , ___
(Ala. 2017) (emphasis added).
The arbitration agreement states: "The undersigned agree
that all disputes ... resulting from, arising out of, relating
to or concerning the transaction entered into or sought to be
entered into ... shall be submitted to BINDING ARBITRATION
...." (Emphasis added.) There is no question that the
arbitration agreement is broadly worded (a fact we have relied
57
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
upon in the appeals in the Booth, Williams, Hubbard, Averette,
and
Fuller cases in concluding that the nonsignatory, Locklear
Group, could enforce the agreement against those plaintiffs).
And "'where a contract signed by the parties contains a valid
arbitration clause that applies to claims "arising out of or
relating to" the contract,'" as does this one, "'that clause
has a broader application than an arbitration clause that
refers only to claims "arising from" the agreement.'" Green
Tree Fin. Corp. v. Vintson, 753 So. 2d 497, 505 (Ala. 1999)
(quoting Reynolds & Reynolds Co. v. King Autos., Inc., 689
So. 2d 1, 2–3 (Ala. 1996)). But as stated, this broader
application still is one that is tied to "the contract" to
which reference is made, i.e., claims "'"arising out of or
relating to" the contract,'" per the language at issue in
Green Tree, for example. Or, in the case of the language at
issue here, disputes "resulting from, arising out of,
relating
to or concerning the transaction entered into or sought to be
entered into." See also State v. Lorillad Tobacco, 1 So. 3d
1, 9 (Ala. 2008) (quoting Kenworth of Dothan, Inc. v.
Bruner–Wells Trucking, Inc., 745 So. 2d 271, 275 (Ala. 1999))
(noting that, "[f]or a dispute to relate to the subject matter
58
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
of the arbitration provision, 'there must be some legal and
logical nexus' between the dispute and the [subject matter of
the] arbitration provision").
In this particular case, the parties agreed to arbitrate
matters "relating to ... the transaction entered into," which
was the Lollars' purchase of a 2009 Dodge Ram truck on May 28,
2013. According to the uncontradicted allegations of the
complaint, the personal information of the Lollars' that was
wrongly disseminated in connection with their identity-theft
claims was provided to Locklear CJD in December 2015 during a
visit to the dealership that was not related to the purchase
of the 2009 Dodge Ram truck. On the face of the arbitration
agreement, its terms do not apply to the interaction of the
Lollars and the defendants that occurred in 2015. The 2013
vehicle purchase to which the 2013 arbitration agreement
refers and relates is one transaction. The Lollars' 2015
visit to the dealership for the purpose of exploring whether
to enter into an entirely different transaction with Locklear
CJD (and their provision of financial information to Locklear
CJD during that visit) is, quite simply, an unrelated matter.
59
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
The situation is similar to one presented in Capitol
Chevrolet & Imports, Inc. v. Payne, 876 So. 2d 1106 (Ala.
2003). In that case, Jean Payne purchased a used 1997
Cadillac Catera automobile from Capitol Chevrolet & Imports,
Inc. ("Capitol"), on September 6, 2001. The arbitration
agreement Payne signed in connection with the purchase had
language similar to the arbitration agreement in this case:
"'Buyer/lessee and dealer agree that
all
claims,
demands,
disputes
or
controversies of every kind or nature
between them arising from, concerning or
relating
to any of the negotiations
involved in the sale, lease, or financing
of the vehicle, the terms and provisions of
the sale, lease, or financing agreements,
the
arrangements
for
financing,
the
purchase
of
insurance,
extended
warranties,
service
contracts
or
other
products
purchased as an incident to the sale, lease
or
financing
of
the
vehicle,
the
performance or condition of the vehicle, or
any other aspects of the vehicle and its
sale, lease, or financing shall be settled
by binding arbitration ....'"
876 So. 2d at 1107.
The Court described the facts involved in Payne's claims
against Capitol as follows:
"In September 2002, Payne sued Capitol and a
Capitol salesperson, Jason Golden, alleging fraud
and conversion. According to Payne's complaint,
60
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
approximately one month after she purchased the
Catera, she returned the Catera to Capitol in
reliance on Golden's representation that Capitol had
a willing buyer for the vehicle. Payne relinquished
possession of the Catera to Capitol and stopped
making payments on the car. Payne alleged that
Golden, while acting in the line and scope of his
employment with Capitol, misrepresented to her that
Capitol had a buyer for the Catera, and that, when
Payne relinquished the Catera to Capitol in reliance
on that misrepresentation, Golden converted the
Catera for his personal use. Payne's complaint
alleged that, as a result of the misrepresentation,
she lost the use of her vehicle, suffered severe
mental anguish, and suffered an adverse credit
rating once she stopped making payments on the
Catera."
876 So. 2d at 1107–08.
The Court concluded that Payne's claims were not related
to her purchase of the Catera and therefore were not subject
to the arbitration agreement.
"We do not believe that the plain language of
the arbitration agreement would lead one to assume
or understand that the agreement covered the claims
alleged in Payne's complaint -- a later fraudulent
misrepresentation, unrelated to the original sale of
the vehicle, resulting in the conversion of the
vehicle. The present dispute involves alleged
subsequent tortious conduct on the part of Capitol
and its agent that is not close enough in relation
to the initial sale of the Catera to be covered by
the language of the arbitration agreement."
876 So. 2d at 1110 (emphasis added).
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1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
In this case, as in Payne, the plain language of the
arbitration agreement, which relates to the 2013 transaction,
does not lead one to understand that the 2015 identity-theft
claims would be covered under the agreement. We noted in
Kenworth of Dothan that, "[i]n order for a dispute to be
characterized as arising out of or relating to the subject
matter of the [transaction], and therefore subject to
arbitration, the language of the arbitration provision must
reasonably apply to the dispute." 745 So. 2d at 275.
In response to the clear disconnect between the
transaction to which the arbitration agreement relates and the
separate matters at issue in this action, Locklear CJD and
Locklear Group do not really explain how the arbitration
agreement is broad enough to encompass the Lollars' identity-
theft claims. Instead, they attempt to rely upon the
arbitrability clause in the arbitration agreement (i.e., the
clause providing that the arbitrator is to decide disputes
over the arbitrability of the parties' underlying substantive
dispute) in an effort to avoid this issue. But the difficulty
with this is the same one that existed in the Booth, Williams,
Hubbard, Averette, and Fuller cases. That is, this issue was
62
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
not presented to the trial court in such a manner as to
preserve it for later appellate review. For the reasons
already stated in our discussion of those other cases, we
cannot reverse the trial court's order on that basis.
Because the arbitration agreement on its face does not
apply to the Lollars' claims, we conclude that the trial court
did not err in denying the joint motion to compel arbitration
filed by Locklear CJD and Locklear Group.
C. Case no. 1160375: Anthony Hood
The final appeal before us involves the joint motion to
compel arbitration filed by Locklear CJD and Locklear Group in
response to the complaint filed by Anthony Hood.
Locklear CJD and Locklear Group contend that they
presented a prima facie case in support of their motion to
compel arbitration, i.e., that they introduced a contract
calling for arbitration and produced evidence showing that the
transaction affected interstate commerce. They argue that the
trial court erred in determining the scope of the arbitration
agreement because the arbitration agreement contained an
arbitrability clause reflecting an agreement to allow the
arbitrator to decide any arbitrability issues.
63
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
Hood's first response to these arguments is that the
version of the arbitration agreement Locklear CJD and
Locklear
Group submitted to the trial court "is invalid and
unenforceable because the agreement is fabricated and was not
signed by [Hood] and the issue is for the Court to decide, not
the arbitrator." "'[A] party who contests the existence of a
contract containing an arbitration provision cannot be
compelled to arbitrate that threshold issue because an
arbitrator derives his authority solely from the parties'
agreement. Only a court can resolve the question whether a
contract exists.'" Title Max of Birmingham, Inc. v. Edwards,
973 So. 2d 1050, 1053-54 (Ala. 2007) (quoting Edward D. Jones
& Co. v. Ventura, 907 So. 2d 1035, 1040 (Ala. 2005)).
Hood's position is meritless. As detailed in the
rendition of the facts, Hood alleged in his complaint and
reiterated in his response to the joint motion to compel
arbitration that he purchased a 2016 Dodge Ram 3500 truck from
Locklear CJD in December 2015. He also admitted in his
response that he signed a "Pre-Dispute Arbitration Agreement"
with Locklear CJD. Hood alleged in his response and in his
supporting affidavit that the only difference between the
64
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
version of the arbitration agreement he signed and the one
Locklear CJD and Locklear Group submitted with their joint
motion to compel arbitration was that in the latter version
"[t]he words 'Locklear Chrysler Jeep Dodge, LLC'" had been
added near the bottom of the agreement in a different typeset
than that of the rest of the agreement. Indeed, the version
of the arbitration agreement Hood attached to his brief
contains all the elements contained in the version attached to
the defendants' joint motion to compel arbitration except the
printed words "Locklear Chrysler Jeep Dodge, LLC" typed or
printed above the "DEALER" signature line. Thus, Hood admits
that he signed the arbitration agreement that contains the
substantive language quoted in this opinion; he admits the
agreement was signed by someone on behalf of the "DEALER,"
which he admits to be Locklear CJD; and he admits that the
agreement contained an exact description of the vehicle he
purchased.
Even if the allegation that Locklear CJD and/or Locklear
Group added the words "Locklear Chrysler Jeep Dodge, LLC" to
the arbitration agreement after Hood signed the agreement is
accepted as true, we are given no basis on which to conclude
65
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
that this is a material alteration to the agreement for
purposes of Hood's underlying claims. This Court has stated
that in order to determine whether an alteration is material
we should inquire: "Did the interposed matter make the
'instrument speak a language different in legal effect from
that which it originally spoke, which carries with it some
change in the rights, interests, or obligations of the
parties?'" Benton v. Clemmons, 157 Ala. 658, 660, 47 So. 582,
583 (1908). See also 3B C.J.S. Alteration of Instruments § 4
(2017) ("In general, for the alteration of an instrument to be
'material,' the alteration must be such as to change the legal
effect of the instrument."). In this instance, the alleged
addition of the words "Locklear Chrysler Jeep Dodge, LLC"
changed none of the obligations of the parties to the
arbitration agreement. Hood knew and admitted that he was
signing an arbitration agreement with Locklear CJD in
connection with his purchase of a vehicle. A representative
of the dealership signed the agreement. The terms of that
agreement were not changed in any degree by the alleged
addition of the words "Locklear Chrysler Jeep Dodge, LLC."
Accordingly, the arbitration agreement was not "fabricated,"
66
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
and Hood's argument does not defeat the arbitration of Hood's
underlying claims.10
Like the Lollars, Hood also contends that his identity-
theft allegations are not within the scope of the arbitration
agreement because they do not "result[] from, aris[e] out of,
relat[e] to or concern[] the transaction entered into," i.e.,
the purchase of a vehicle from Locklear CJD, which is the
object of the arbitration agreement. In response, as in the
Lollars' case (and the Hubbard, Averette, Fuller, Booth, and
Williams cases), Locklear CJD and Locklear Group counter that
there is a clause in the arbitration agreement that provides
for the arbitrator to determine the scope of the arbitration
agreement.
Unlike all the other appeals before us, however, in this
case not only was there a hearing on the motion to compel
arbitration, but also that hearing was transcribed and the
transcript submitted as part of the record on appeal.
10In an effort to provide an alternative ground for
affirmance of the trial court's order as to Locklear Group,
Hood also makes a "nonsignatory" argument similar to that made
by first group of plaintiffs discussed above. This argument
by Hood fails for the same reasons as did the similar argument
by those other plaintiffs. See discussion, supra.
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1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
According to that transcript, Hood's counsel argued as
follows
to the trial court: "[O]ur argument is that somebody at the
dealership was being allowed to [take customers' personal
information] and then sell [their] identities out on the black
market[, which] doesn't have anything to do with buying a
car." In response, counsel for Locklear CJD and Locklear
Group stated:
"And our response to that specific argument is,
first, we believe that the arbitration agreement is
broad enough in scope to cover these. But, more
importantly, we don't even get to that issue here
before you, your Honor. The arbitration agreement
clearly provides that the issue of scope and breadth
arbitrability is for the arbitrator to decide, not
this trial court. So whether or not the claims
being asserted fall within the scope of the
arbitration agreement is for the arbitrator to
decide based on the plain and unambiguous language
in the arbitration agreement. Plus, it applies for
AAA rules, and there [are] Alabama Supreme Court
cases that clearly state that, that in and of itself
also shows an intent based on those rules to allow
the arbitrator to decide the issue of scope and
breadth. So that is something that the arbitrator
is to determine and not this court."
Thus, in Hood's case, Locklear CJD and Locklear Group
clearly and explicitly argued to the trial court that there
was an arbitrability clause in the arbitration agreement and
that the import of the clause was that the issue whether
68
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
Hood's identity-theft claims were covered by the arbitration
agreement was for the arbitrator to decide, not the trial
court. Therefore, the effect of the arbitrability clause is
properly before us in this appeal.
Hood's first response to Locklear CJD and Locklear
Group's invocation of the arbitrability clause is to contend
that "clear and unmistakable evidence that [Hood] and [the]
Locklear Defendants agreed to arbitrate the issue of
arbitrability does not exist because a valid arbitration
agreement does not exist." This argument relies upon Hood's
assertion, which we just rejected, that the arbitration
agreement was fabricated. Because we have concluded that a
valid arbitration agreement was submitted by Locklear CJD and
Locklear Group, the arbitrability clause cannot be ignored on
that basis.
Hood next contends that the "Locklear Defendants arguably
waived a 'First Options clause' argument because this argument
was not presented in their initial Motion to Compel
Arbitration with the trial court or in oral argument on the
69
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
same."11 As we have already recounted, however, Locklear CJD
and Locklear Group clearly and explicitly presented its
arbitrability-clause argument to the trial court in the
hearing on their joint motion to compel arbitration.
Hood also argues that the arbitrability clause in the
arbitration agreement is "wholly diverse from the "'First
Options clause' in [Smith v.] Mark Dodge[, Inc., 934 So. 2d
375 (Ala. 2006)]." Hood notes that the arbitrability clause
in Smith stated: "'[Smith] and [Mark Dodge] further agree
that any question regarding whether a particular controversy
is
subject
to
arbitration
shall
be
decided
by
the
Arbitrator.'" 934 So. 2d at 378. Hood argues that "[t]he
explicit language in Mark Dodge stating 'whether a particular
controversy is subject to arbitration shall be decided by the
Arbitrator'
is
clearly
missing
from
[the]
Locklear
Defendants'
fabricated arbitration agreement."
In their principal brief, Locklear CJD and Locklear Group
do not contend that the arbitrability clause in the
arbitration
agreement
is
similar
in
wording
to
the
11Hood's reference to a "First Options clause" is a
reference to the discussion of arbitrability clauses in First
Options of Chicago, Inc. v. Kaplan, 514 U.S. 938 (1995).
70
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
arbitrability clause in Smith. Instead, they argue correctly
that the arbitrability-clause language in the arbitration
agreement is identical to language in arbitration agreements
analyzed by this Court in Jim Burke Automotive, Inc. v.
McGrue, 826 So. 2d 122 (Ala. 2002), and Ex parte Waites, 736
So. 2d 550 (Ala. 1999).12 As Locklear CJD and Locklear Group
observe, this Court in McGrue and Waites held that the
arbitrability
clauses
in
those
arbitration
agreements
constituted clear and unmistakable evidence that the parties
intended to arbitrate issues of arbitrability.
In his brief to this Court, Hood addresses McGrue and
Waites, but only by contending that they are distinguishable
from the present case on the ground that "neither [McGrue nor
Waites] disputed the validity of the underlying arbitration
agreements." As we already have concluded, however, Hood's
contention that the arbitration agreement was "fabricated"
must be rejected. The fact remains, then, that in McGrue and
Waites this Court concluded that language identical to that
contained in the arbitration agreement was sufficient to
warrant submission of issues of arbitrability to the
12See discussion, supra.
71
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
arbitrator. Hood offers no other reason why McGrue and Waites
would not be dispositive of the present case.
IV. Conclusion
Based on the foregoing analysis, we affirm the order of
the trial court in the Lollars' appeal, which denied the joint
motion to compel arbitration filed by Locklear CJD and
Locklear Group. We reverse the trial courts' orders in
Hubbard's, Averette's, Fuller's, Booth's, and Williams's
appeals, which denied the motions to compel arbitration as to
Locklear Group, and in Hood's appeal, which denied the joint
motion to compel arbitration filed by Locklear CJD and
Locklear Group; those causes are remanded for the trial courts
to enter orders granting those motions.
72
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
1160335 -- REVERSED AND REMANDED.
1160336 -- REVERSED AND REMANDED.
1160337 -- REVERSED AND REMANDED.
1160435 -- MOTION TO STRIKE GRANTED; AFFIRMED.
1160436 -- MOTION TO STRIKE GRANTED; REVERSED AND
REMANDED.
1160437 -- MOTION TO STRIKE GRANTED; REVERSED AND
REMANDED.
Stuart, C.J., and Bolin, Main, and Bryan, JJ., concur.
1160375 -- REVERSED AND REMANDED.
Stuart, C.J., and Bolin, Main, and Bryan, JJ., concur.
Murdock, J., concurs specially.
73
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
MURDOCK, Justice (concurring specially in case no. 1160375).
As the main opinion explains, Anthony Hood responds to
the invocation by Locklear Chrysler Jeep Dodge, LLC, and
Locklear Automotive Group, Inc., of this Court's decisions in
Jim Burke Automotive, Inc. v. McGrue, 826 So. 2d 122 (Ala.
2002), and Ex parte Waites, 736 So. 2d 550 (Ala. 1999), but he
does so by arguing only that those cases involved no issue as
to the validity of the underlying arbitration agreements,
whereas, according to Hood, the underlying arbitration
agreement in this case is invalid (the rejection of the latter
proposition by the main opinion being a position with which I
agree). Hood does not, for example, attempt to argue that the
language of the arbitrability provision at issue here is
materially different from that held to be sufficient in McGrue
and Waites. Neither does Hood argue that we should overrule
McGrue and Waites. And, although I confess concerns as to the
sufficiency of the language here to meet the "clear and
unmistakable" test articulated in First Options of Chicago,
Inc. v. Kaplan, 514 U.S. 938 (1995), other than pointing out
that the language used here is "diverse" from the more
explicit language employed in First Options, Hood does not
74
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
offer a sufficient explication of the asserted insufficiency
so as to compel a reexamination of McGrue and Waites. And
because the question at hand does not concern the subject-
matter jurisdiction of the trial court or this Court, I cannot
conclude that this Court should sua sponte explore the matter.
In addition, neither party has even mentioned this
Court's 2012 decision in Auto Owners Insurance, Inc. v.
Blackmon Insurance Agency, Inc., 99 So. 3d 1193 (Ala. 2012).
In particular, Hood does not argue that, even if the
arbitrability language at issue satisfies the "clear and
unmistakable" standard articulated in First Options, the
particular underlying substantive claims in this case should
not be sent to the arbitrator for consideration of their
arbitrability because they do not even "arguably" fall within
the ambit of the arbitration agreement. See Blackmon, 99
So. 3d at 1198. That is, no issue is raised as to whether
Hood's identity-theft claims fall within the universe of
disputes to which the so-called arbitrability clause is to
apply. I feel no compunction therefore to cast a vote in this
case reflective of the position I took in my dissent in
75
1160335, 1160336, 1160337, 1160375, 1160435, 1160436, and
1160437
Blackmon, a position to which I continue to adhere. See
Blackmon, 99 So. 3d at 1199 (Murdock, J., dissenting).
76 | September 29, 2017 |
5a61369c-3e01-47c7-80e0-45f078ed1cd0 | Bronner v. Burks | N/A | 1150817 | Alabama | Alabama Supreme Court | REL: December 22, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334)
229-0649), of any typographical or other errors, in order that corrections may be made
before the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
_________________________
1150817
_________________________
David G. Bronner, as secretary-treasurer of the Public
Education Employees' Health Insurance Plan, et al.
v.
James B. Burks II et al.
Appeal from Montgomery Circuit Court
(CV-14-900964)
SHAW, Justice.
This is the second time this dispute related to benefits
provided under the Public Education Employees' Health
Insurance Plan ("PEEHIP") has come before this Court. See Ex
parte Retirement Sys. of Alabama, 182 So. 3d 527 (Ala. 2015)
1150817
("RSA I"). In the present case, the remaining defendants
below,1 David G. Bronner, as secretary-treasurer of PEEHIP,
and the current members of the PEEHIP Board, petitioned this
Court, pursuant to Rule 5, Ala. R. App. P., for permission to
appeal the trial court's denial of their motion seeking a
summary judgment. For the reasons discussed below, we dismiss
the appeal.
Facts and Procedural History
In RSA I, we set out the pertinent factual and procedural
history as follows:
"PEEHIP, which is managed by the PEEHIP Board,
provides
group
health-insurance
benefits
to
public-education employees in Alabama. Each year,
the PEEHIP Board submits 'to the Governor and to the
Legislature the amount or amounts necessary to fund
coverage for benefits authorized by this article for
the following fiscal year for employees and for
retired employees as a monthly premium per active
member per month.'• § 16-25A-8(b), Ala. Code 1975.
That monthly premium is paid by employers for each
of
their
active
members
('the
employer
contribution'). See § 16-25A-8(a), Ala. Code 1975.
"In addition, '[e]ach employee and retired
employee [is] entitled to have his or her spouse and
dependent children, as defined by the rules and
regulations of the [PEEHIP B]oard, included in the
1As discussed below, this Court in RSA I ordered the
dismissal of several of the original defendants in the
underlying action.
2
1150817
coverage
provided
upon
agreeing
to
pay
the
employee's contribution of the health insurance
premium for such dependents.' § 16-25A-8(e), Ala.
Code 1975. Section 16-25A-1(8), Ala. Code 1975,
provides, in pertinent part, that '[i]ndividual
premiums may include adjustments and surcharges for
... family size including, but not limited to, a
husband and wife both being covered by a health
insurance plan as defined herein.'• The employer
contribution, as well as 'all premiums paid by
employees and retired employees under the provisions
of this section and any other premiums paid under
the provisions of this article,'•are deposited into
PEEHIF [Public Education Employees Health Insurance
Fund]. § 16-25A-8(f), Ala. Code 1975."
182 So. 3d at 530.
According to the plaintiffs, before 2010, each public-
education employee participating in PEEHIP "received" an
"allotment" to use to obtain health-insurance coverage from
PEEHIP. PEEHIP offered a "hospital plan" and a health-
maintenance-organization ("HMO") plan, as well as four
"optional" plans that provided supplemental health-care
coverage. Public-education employees could use their
allotments to select from these plans. A married couple, both
of whom were public-education employees, would each have their
own allotment to use. Additionally, these couples could
"combine" their allotments and receive "family coverage,"
3
1150817
which would also cover their dependent children, without
paying a premium for such coverage.
In 2010, the PEEHIP Board began implementing a new policy
("the 2010 policy").2 According to the plaintiffs, under the
2010 policy, when two public-education employees were married
to one another, each could still use his or her allotment to
purchase individual coverage or optional, supplemental plans.
However, if they had dependents and wanted family coverage,
both allotments had to be "combined," and they now had to pay
a premium for family coverage. The couple could not use one
allotment to purchase family coverage and the other allotment
to purchase optional, supplemental plans.
In May 2014, James B. Burks II, Eugenia Burks, Martin A.
Hester, Jacqueline Hester, Thomas Highfield, Carol Ann
Highfield,
Jake
Jackson,
and
Melinda
Jackson,
individually
and
on behalf of a class of similarly situated individuals who are
all
public-education
employees
and
PEEHIP
participants
married
to other public-education employees and PEEHIP participants
and who have dependent children, sued Bronner and the
2In
accordance with
the
allegations in
the
complaint, this
policy is referred to in RSA I as "the 2009 policy." 182 So.
3d at 530-31. Subsequent pleadings filed after RSA I revealed
that the policy changes were implemented in 2010.
4
1150817
individual members of the PEEHIP Board, among other
defendants. In their complaint, the plaintiffs challenged the
2010 policy changes and alleged, among other things, that the
2010 policy treated them differently from other public-
education employees and PEEHIP participants.
The alleged disparity, as far as this Court can tell from
the complaint and other materials in the record, is this:
When one spouse in a family is a public-education employee,
and thus one allotment is available, that allotment may be
used to purchase family coverage, and the family pays the
family-coverage premium. When both spouses are public-
education employees and wish to purchase family coverage, then
both allotments must be used, and the family also pays the
family-coverage premium. The couple cannot use one allotment
toward the family coverage and use the other allotment to
obtain an optional plan. Thus, one of the spouses, it is
alleged, is effectively denied the use of an allotment when
compared to other public-education employees: The insurance
benefits the two married public-education employees receive
with both allotments--family coverage--is the same as the
insurance benefits
a
family
with
one
public-education employee
5
1150817
receives using one allotment. It also appears that the
plaintiffs challenge the fact that, since the 2010 policy
changes, they now have to pay premiums for family coverage
when, under the prior policy, they could combine their
allotments and pay no premiums.3
The plaintiffs alleged that the 2010 policy
"violated Article V, § 138.03, Alabama Constitution
of 1901, as well as the public-education plaintiffs'
rights to equal protection, due process, and freedom
of association under the Alabama Constitution, the
United States Constitution, and 42 U.S.C. § 1983.
The public-education plaintiffs also alleged that
the [2010] policy violated Alabama public policy and
their right to family integrity as protected by the
Alabama
Constitution.
The
public-education
plaintiffs sought relief in the form of (1) a
judgment
declaring
'[the
PEEHIP
defendants']
practice of denying an allotment for insurance
benefits to educators who are married to another
educator and who have dependent children to be
unconstitutional, discriminatory and unlawful under
both State and Federal law'; (2) an injunction
preventing the PEEHIP defendants from 'denying an
allotment for insurance benefits to educators whose
spouse is also an educator in the public school
system and who have dependent children'; (3)
restitution of 'amounts ... unlawfully withheld
and/or ... amounts [the public-education plaintiffs]
have paid for insurance that they would not have
paid absent [the PEEHIP defendants'] unlawful
3As to this point, the complaint states: "[R]ather than
having no out-of-pocket costs for health insurance, the couple
has to contribute [a family-coverage premium] each month for
health insurance."
6
1150817
conduct'•or other equitable relief; and (4) costs
and attorney fees."
RSA I, 182 So. 3d at 531 (footnote omitted).
In RSA I, we considered the propriety of the trial
court's denial of the defendants' motion to dismiss pursuant
to Rules 12(b)(1) and 12(b)(6), Ala. R. Civ. P., on the ground
of, among other things, the doctrine of State immunity.
Noting that the plaintiffs had voluntarily agreed to dismiss
some of their claims and further concluding that other claims
were barred by State immunity, we granted the petition as to
all claims and parties except for the "plaintiffs' claims for
injunctive relief, pursuant to § 1983, against the members of
the
PEEHIP
Board
and
Bronner,
in
his
capacity
as
secretary-treasurer of PEEHIP." RSA I, 182 So. 3d at 530.
Following this Court's decision in RSA I, proceedings
resumed in the trial court on the plaintiffs' remaining
federal claims against the PEEHIP Board and Bronner
(hereinafter referred to collectively as "the defendants")
seeking injunctive relief. The defendants filed a motion
requesting a summary judgment as to those claims on various
grounds. Specifically, the motion contended that PEEHIP
participants did not actually receive an allotment of PEEHIP
7
1150817
funds in any particular dollar amount; the employer
contribution is actually paid by the employer to the Public
Education Employees Health Insurance Fund ("PEEHIF"). The
defendants argued that PEEHIP participants instead received
insurance coverage. Additionally, the defendants argued that
the plaintiffs were unable to establish an equal-protection
violation because, they argued, the plaintiffs could not show
that they were treated differently from other similarly
situated individuals because, after the 2010 policy changes,
the plaintiffs now pay the same premiums as other PEEHIP
participants for similar coverage.4 Finally, the defendants
asserted that, even assuming that the plaintiffs' equal-
protection rights were implicated, the 2010 policy changes
nonetheless "pass constitutional muster" under the "'rational
basis test.'"5
4Specifically, after the 2010 policy changes, all PEEHIP
participants pay a $15 premium for individual coverage and a
$117 premium for family coverage. PEEHIP participants who are
married to another PEEHIP participant also each have to pay
the $15 monthly premium for individual coverage as well as the
$117 premium for family coverage if they wish to cover
dependents. Thus, according to the defendants, the
plaintiffs
are now paying the same premium for family coverage as
individual public-education employees.
5The defendants maintained that the "Plaintiffs' claims
are subject to rational basis review because they do not
8
1150817
As to the plaintiffs' claims regarding a denial of due
process, the defendants contended, among other things, that
"the rates of monthly premiums that PEEHIP participants must
pay" did not create a property interest that would be
protected by due-process rights. In addition, their actions
"easily passed the applicable rational basis test" related to
a due-process analysis. Finally, the defendants argued that
the plaintiffs' allegations did not establish a violation of
freedom-of-association
rights
guaranteed
by
the
First
Amendment.
In their opposition to the summary-judgment motion, the
plaintiffs argued that the defendants had failed to address
their claims. Specifically, although the defendants focused
on whether the plaintiffs paid the same premiums as did other
participants, that consideration, the plaintiffs said, was
irrelevant. Instead, the plaintiffs claimed that they were
challenging the loss of the use of an allotment by public-
education employees married to public-education employees who
desire family coverage. Further, the plaintiffs submitted,
among
other
things,
certain
PEEHIP
publications
they
involve a suspect classification or a fundamental right."
9
1150817
maintained demonstrated that, before the 2010 policy changes,
they received allotments--referred to in the documents as
"allocations"--but that, after the changes, one spouse was
denied the use of an allocation/allotment if the couple
purchased family coverage to cover dependents.6 The
plaintiffs argued that the defendants' "documents clearly
establish that each [public-education employee] earns an
'allocation' for the purchase of insurance" that was being
denied to them "for the sole reason that the [public-education
employee] has chosen to marry another [public-education
employee] and to have children." The plaintiffs alleged that,
as a result of the 2010 policy changes, they had been "denied
benefits they would have received had they been treated the
same" as other PEEHIP participants.7
Following subsequent related filings by the parties and
a hearing, the trial court denied the defendants' summary-
6It appears that, although the plaintiffs used the term
"allotment" in their complaint, the PEEHIP documents use the
term "allocation" to refer to the same item. The terms are
used interchangeably in the record and the briefs.
7In
their
opposition, the
plaintiffs did
not
challenge the
defendants' arguments regarding their freedom-of-association
claim. Further, they advance no argument regarding it on
appeal. We thus conclude that the plaintiffs have abandoned
this claim.
10
1150817
judgment motion. The defendants filed a "motion for
reconsideration," arguing that the only remaining issue was a
legal question and seeking permission to take an
interlocutory
appeal pursuant to Rule 5, Ala. R. App. P. The trial court
denied the defendants' request to "reconsider" but granted
them permission to appeal based on its conclusion that "[a]n
immediate appeal from said Order would materially advance the
ultimate termination of the litigation." The defendants then
filed a petition for permission to appeal in this Court, which
we granted.
Discussion
"This Court
has
stated the
following with regard
to permissive appeals:
"'In the petition for a permissive
appeal, the party seeking to appeal must
include a certification by the trial court
that the interlocutory order involves a
controlling question of law, and the trial
court must include in the certification a
statement of the controlling question of
law. Rule 5(a), Ala. R. App. P. In
conducting our de novo review of the
question presented on a permissive appeal,
"this Court will not expand its review ...
beyond the question of law stated by the
trial court. Any such expansion would
usurp the responsibility entrusted to the
trial court by Rule 5(a)." BE&K, Inc. v.
Baker, 875 So. 2d 1185, 1189 (Ala.
2003)....'
11
1150817
"Alabama Powersport Auction, LLC v. Wiese, 143 So.
3d 713, 716 (Ala. 2013)."
Northstar Anesthesia of Alabama, LLC v. Noble, 215 So. 3d
1044, 1047 (Ala. 2016).
Here, the trial court certified the following controlling
question of law:
"Whether
given
the
undisputed
facts
the
Defendants
violated
Plaintiffs'
constitutional
rights under the Equal Protection Clause, the Due
Process Clause, or the First Amendment, by requiring
Plaintiffs to pay the same health insurance premiums
as other PEEHIP participants and by not 'allotting'
a specific amount of PEEHIP funds to each PEEHIP
participant individually?"
The question, viewed in the context of the arguments
below, addresses in two ways the constitutionality of the
2010
policy
when
public-education employees
married
to
public-
education employees opt for family coverage: (1) the
constitutionality of the requirement that the plaintiffs pay
a premium for that coverage, and (2) the constitutionality of
the failure to allot one spouse a "specific amount of PEEHIP
funds."
A. Constitutionality of the premiums
First, the plaintiffs claim that the certified question,
by stating the issue in terms of whether the plaintiffs'
12
1150817
rights were violated by requiring the payment of the "same"
premium, misstates the issue. Specifically, as detailed
above, the plaintiffs argued in the trial court that they were
not challenging the premiums but, instead, the denial of an
allotment. At the hearing on the motion for a summary
judgment, counsel for the plaintiffs stated:
"[Counsel for the defendants] says the issue is, do
plaintiffs have a federal constitutional right to
pay lower premiums for health insurance benefits
than other PEEHIP participants? That's not the
issue. That's not what we say. That is not what we
have said in our complaint. That is not what we said
in the Motion to Dismiss. That's not what we said in
our brief that we filed here.
"What we have said, Judge, is that public
employees, public teachers, earn sometimes it is
referred to allotments and sometimes it is referred
to allocations, that they were receiving allocations
that they had earned before the PEEHIP board decided
to take that away from them and to set up different
classes of individuals and treat them differently
and to take their property right without due
process. That's what we have said from the
beginning."
Further, in their brief on appeal, the plaintiffs state:
"The controlling question in this litigation is
not the amount of premiums Plaintiffs are charged
for family coverage or whether Plaintiffs' pay the
same amount of premiums paid by other educators. To
be absolutely clear, this case does not in any way
involve the amount of premiums charged or paid.5
"_____________
13
1150817
"5To Plaintiffs' knowledge, the PEEHIP Board has
not
manipulated
the
premium
rates
in
a
constitutionally
impermissible
manner--only
Plaintiffs' right to utilize their earned insurance
allocation."
Appellees brief, at 11-12.
It is true that in their complaint in this case, as
discussed above, the plaintiffs appeared to challenge the
fact
that,
before
the
2010
policy
changes,
they
had
no
"out-of-pocket costs for health insurance" and now, after the
changes, they have to pay a family-coverage premium. However,
given the statements by the plaintiffs in the trial court and
on appeal, it appears that, either by waiver or abandonment,
they no longer wish to pursue such a claim. Although the bulk
of
the
defendants'
arguments
on
appeal
address
the
constitutionality of the premiums, we see no need to address
it now, because this portion of the question certified by the
trial court no longer addresses a controlling question of law
in this case.
B. Constitutionality of the denial of an allotment
In discussing the second issue in the certified question,
we must address the parties' arguments as to the nature of the
"allocation" or "allotment" in this case. The defendants
14
1150817
argue that the plaintiffs are not actually entitled to any
sort of allotment of a specific dollar amount to purchase
insurance coverage and, because of this, the plaintiffs'
constitutional
claims
must
fail.
Specifically,
the
legislature sets the amount of the employer contribution that
the public-education employers must pay for each employee.
See § 16-25A-8(b), Ala. Code 1975 (providing that the
legislature sets the employer-contribution rate after the
PEEHIP Board certifies to the governor and the legislature the
amount necessary to fund coverage). The
employer contribution
is not actually given to PEEHIP participants for them to use
to purchase insurance; instead, it is paid to PEEHIF. § 16-
25A-8(f), Ala. Code 1975. According to the defendants, the
employer contribution must be paid regardless of what health-
insurance option a public-education employee selects, even if
the employee does not enroll in PEEHIP at all. This, the
defendants contend, illustrates that no dollar amount is
allotted for public-education employees to use to purchase
insurance.
However, the plaintiffs produced documents issued by
PEEHIP--certain issues of the PEEHIP Advisor newsletter and
15
1150817
copies of the PEEHIP Member Handbook for various years--that
show
that
PEEHIP
insurance-availability
options
were
explained
to PEEHIP participants in terms of "allocations" or "state
allocations." As late as 2014, the PEEHIP Member Handbook
indicated that PEEHIP participants "earned" allocations and
that those "state allocation[s] will pay in full" optional
coverage plans, or that a PEEHIP participant could "apply the
state allocation" for other coverage plans. Further, the
plaintiffs note that the August 2010 PEEHIP Advisor newsletter
stated that, after the 2010 policy changes, public-education
employees
married
to
other
public-education employees must
use
both "allocations" if purchasing family coverage, and
that one
of the allocations they earned could not be used for optional
plans. Finally, the 2015-2016 PEEHIP Member Handbook--issued
after this action was filed--omits mention of allocations
completely. It describes employees as now earning months of
"coverage," and the section of the handbook previously
discussing
"allocations"
now
refers
to
"employer
contributions."
The defendants, on the other hand, explain that the
allocations or allotments were not the actual "employer
16
1150817
contribution" being given to public-education employees for
their use; that money was always paid to the PEEHIF no matter
what a public-education employee elected to do. Instead,
according to the defendants, the term "allocations" simply
described "eligibility for coverage." By law, the defendants
say, PEEHIP participants did not receive the money, a fact
they say is confirmed by the statute, and, they say, any
statement implying the contrary in the PEEHIP handbooks or
newsletters would not trump the statute.8
We agree with the defendants that the allocations or
allotments did not represent a sum of money PEEHIP
participants were entitled to receive to purchase insurance--
all funds are instead paid by public-education employers to
PEEHIF. Rather, the "allocations" simply represented a
public-education employee's monthly eligibility for insurance
coverage. Nevertheless, this does not end the analysis. It
appears from the materials before us that public-education
employees "earned" or were "eligible" for monthly coverage and
could use that benefit, at their option, to select certain
8It appears that the term "allocation" was used because,
before 1983 and the creation of PEEHIP, public-education
employees were actually allocated a sum of money to use to
purchase insurance coverage on their own.
17
1150817
coverage alternatives. Whether described as allotments,
allocations, or units of monthly eligibility, each public-
education employee accrues a monthly insurance benefit. Each
public-education employee may use this benefit to purchase
family coverage. But, as the plaintiffs allege and the
materials before the Court confirm, when two PEEHIP
participants are married to each other, they may not use one
of their accrued benefits to purchase family coverage--they
must use both. When compared to individual PEEHIP
participants--where only one accrued monthly benefit can be
used to purchase family coverage--one spouse is effectively
denied the monthly insurance benefit that accrued. In such a
case, it does not matter that the money represented by the
employer contribution is paid to PEEHIF--one spouse is denied
the benefit of the coverage he or she earned. It is true
that, ultimately, the premium paid for the family coverage is
the same. Nevertheless, the benefits provided are
different--
the couple is treated as though they receive only one monthly
eligibility benefit instead of two.
The defendants' arguments on appeal do not address the
constitutionality of the purported denial of this monthly
18
1150817
coverage benefit. Instead, the defendants focus on whether
the plaintiffs were entitled to an allocation of specific
funds. It is true that, both in the trial court and on
appeal, the plaintiffs at times refer to the allocations as
something granting them a specific dollar amount to use to
purchase insurance, which, as discussed above, the defendants
have shown is not the case. However, the plaintiffs also
challenge the denial or loss of the benefit provided to one of
the spouses. This, we believe, is the controlling question of
law in this case, and it is not addressed by either the
certified question or in the defendants' brief.
When a trial court fails to correctly identify the
controlling question of law, a Rule 5 permissive appeal is due
to be dismissed. BE&K, Inc. v. Baker, 875 So. 2d 1185, 1189
(Ala. 2003). See also Continental Cas. Co. v. Pinkston, 941
So. 2d 926 (Ala. 2006) (dismissing a Rule 5 permissive appeal
where the trial court's order and appellant's brief were based
on an incorrect assumption and did not address the controlling
issue). After thoroughly reviewing the record and the
arguments presented by the parties, we conclude that the
permission to appeal under Rule 5, Ala. R. App. P., was
19
1150817
improvidently granted, and we dismiss the appeal. See Hughes
Beverage Co. v. Hughes, 861 So. 2d 1087, 1088 (Ala. 2003).
APPEAL DISMISSED.
Stuart, C.J., and Parker, Wise, Bryan, and Sellers, JJ.,
concur.
Murdock, J., concurs in the result.
Bolin, J., dissents.
Main, J., recuses himself.
20 | December 22, 2017 |
422320a2-7fac-47d8-bd98-f32bfa9ae12c | Ex parte Locklear Chrysler Jeep Dodge, LLC, and Locklear Automotive Group, Inc. | N/A | 1160374 | Alabama | Alabama Supreme Court | Rel:09/29/2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
SPECIAL TERM, 2017
____________________
1160372
____________________
Ex parte Locklear Chrysler Jeep Dodge, LLC, and Locklear
Automotive Group, Inc.
PETITION FOR WRIT OF MANDAMUS
(In re: Rhonda Cook
v.
Locklear Chrysler Jeep Dodge, LLC, and Locklear Automotive,
Inc.)
(Bibb Circuit Court, CV-16-900049)
____________________
1160373
____________________
Ex parte Locklear Chrysler Jeep Dodge, LLC, and Locklear
Automotive Group, Inc.
PETITION FOR WRIT OF MANDAMUS
(In re: James McKinney
v.
Locklear Chrysler Jeep Dodge, LLC, and Locklear Automotive
Group, Inc.)
(Bibb Circuit Court, CV-16-900053)
____________________
1160374
____________________
Ex parte Locklear Chrysler Jeep Dodge, LLC, and Locklear
Automotive Group, Inc.
PETITION FOR WRIT OF MANDAMUS
(In re: James Daniel Parker
v.
Locklear Chrysler Jeep Dodge, LLC, and Locklear Automotive
Group, Inc.)
(Bibb Circuit Court, CV-16-900054)
BOLIN, Justice.
Locklear
Chrysler
Jeep
Dodge,
LLC,
and
Locklear
Automotive Group, Inc. (hereinafter referred to collectively
as "Locklear"), seek a writ of mandamus ordering the Bibb
2
1160372, 1160373, 1160374
Circuit Court to vacate certain discovery orders in actions
filed against Locklear by Rhonda Cook, James McKinney, and
James Daniel Parker (hereinafter referred to collectively as
"the purchasers"), who allege that they were victims of
identity theft by a Locklear employee.
Facts and Procedural History
In order to explore the possibility of financing the
purchase of an automobile from Locklear, the purchasers each
completed a credit application. The credit applications
contained personal information, including Social Security
numbers, birth dates, mother's maiden names, income, etc. In
connection with the purchase, each purchaser signed an
arbitration agreement titled "Binding Pre-Dispute Arbitration
Agreement" ("the arbitration agreement"); its operative
language is as follows:
"In
connection
with
the
undersigned's
acquisition or attempted acquisition of the below
described vehicle, by lease, rental, purchase or
otherwise, the undersigned and the dealer whose name
appears below, stipulate and agree, in connection
with the resolution of any dispute arising out of,
or relating to, resulting from or concerning any
contracts or agreements, or agreements or contracts
to be entered into by the parties, all alleged
representations, promises and covenants, issues
concerning compliance with any state or federal law
or regulation, and all relationships resulting
3
1160372, 1160373, 1160374
therefrom, as follows: That the vehicle, services,
and products (hereinafter 'products') involved in
the
acquisition
or
attempted
acquisition
are
regulated by the laws of the United States of
America; and/or, that the contract(s) and agreements
entered into by the parties concerning said products
evidence transactions and business enterprises
substantially involving and affecting interstate
commerce sufficiently to invoke the application of
the Federal Arbitration Act, 9 U.S.C. § 1, et seq.
The undersigned agree that all disputes not barred
by applicable statutes of limitations, resulting
from, arising out of, relating to or concerning the
transaction entered into or sought to be entered
into (including but not limited to: any matters
taking place either before or after the parties
entered into this agreement, including any prior
agreements or negotiations between the parties; the
terms of this agreement and all clauses herein
contained, their breadth and scope, and any term of
any agreement contemporaneously entered into by the
parties; the past, present and future condition of
any products at issue; the conformity of the
products
to
any
contract
description;
the
representations, promises, undertakings, warranties
or covenants made by the dealer, its agents,
servants, employees, successors and assigns, or
otherwise dealing with the products; any lease, sale
or rental terms or the terms of credit and/or
financing in connection therewith; or compliance
with any state or federal laws; any terms or
provisions of any insurance sought to be purchased
or purchased simultaneously herewith; any terms or
provisions of any extended service to be purchased
or purchased herewith) shall be submitted to BINDING
ARBITRATION, pursuant to the provisions of 9 U.S.C.
§ 1, et seq. and according to the Commercial Dispute
Resolution procedures and/or Consumer Protocol
(depending on the amount in controversy) of the
American Arbitration Association (the AAA) then
existing in the county where the transaction was
entered into or sought to be entered into, except as
4
1160372, 1160373, 1160374
follows: (a) In all disputes in which the matter in
controversy (including compensatory and punitive
damages, fees and costs) is more than $10,000 but
less than $75,000.00, one arbitrator shall be
selected in accordance with the AAA's Consumer
Protocol. In all disputes in which the matter in
controversy (including compensatory and punitive
damages and fees and costs) is $75,000.00 or more,
the parties to this agreement shall select an
arbitrator under the AAA's Commercial Rules and
shall select one arbitrator from a list of at least
5 suitable arbitrators supplied by the AAA in
accordance with and utilizing the AAA strike method.
(b) An arbitrator so selected shall be empowered to
enter an award of such damages, fees and costs, and
grant such other relief, as is allowed by law. The
arbitrator has no authority or jurisdiction to enter
any
award
that
is
not
in
conformance
with
controlling law. Any party to this agreement who
fails or refuses to arbitrate in accordance with the
terms of this agreement may, in addition to any
other relief awarded, be taxed by the arbitrator
with the costs, including reasonable attorney's
fees, of any other party who had to resort to
judicial or other relief in compelling arbitration.
In the event the dealer and the undersigned
customer(s) have entered into more than one
arbitration agreement concerning any of the matters
identified herein, the undersigned customers and the
dealer agree that the terms of this arbitration
agreement shall control disputes between and among
them. Any provision in this Agreement found to be in
conflict with any procedure promulgated by the AAA
which shall affect its administration of disputes
hereunder, shall be considered severed herefrom.
With respect to the process of arbitration under the
AAA commercial Rules or Consumer Protocol, the
undersigned customer(s) and the dealer expressly
recognize that the rules and protocol and the terms
of this agreement adequately protect their abilities
to fully and reasonably pursue their respective
statutory and other legal rights. If for any reason
5
1160372, 1160373, 1160374
the AAA fails or refuses to administer the
arbitration of any dispute brought by any party to
this agreement, the parties agree that all disputes
will then be submitted to binding arbitration before
the Better Business Bureau (the BBB) serving the
community where the Dealer conducts business, under
the BBB binding arbitration rules. ... This
agreement
shall
survive
any
termination,
cancellation, fulfillment, or non-fulfillment of any
other contract, covenant or agreement related to the
products acquired or sought to be acquired from the
Dealer, including, but not limited to cancellation
due to lack of acceptable financing or funding of
any retail installment contract or lease. Further
information about arbitration can be obtained
directly from the AAA or from a review of AAA's
Commercial
Dispute
Resolution
Procedures
and
Consumer
Protocol,
and/or
the
BBB's
Binding
Arbitration Rules, copies of which are available
without charge for review from the AAA and the BBB.
THE
UNDERSIGNED
HAVE
AGREED
TO
WAIVE
THE
UNDERSIGNED(S)' RIGHT TO A TRIAL BY JUDGE OR JURY IN
ALL DISPUTES OVER $10,000.00 AND THAT ARBITRATION
SHALL BE IN LIEU OF ANY CIVIL LITIGATION IN ANY
COURT AND IN LIEU OF ANY TRIAL BY JUDGE OR JURY FOR
ALL CLAIMS OVER $10,000.00. THE TERMS OF THIS
AGREEMENT AFFECT LEGAL RIGHTS. IF YOU DO NOT
UNDERSTAND ANY PROVISION OF THIS AGREEMENT OR THE
COSTS, ADVANTAGES OR DISADVANTAGES OF ARBITRATION,
SEEK INDEPENDENT ADVICE AND/OR REVIEW THE WRITTEN
CONSUMER
AND/OR
COMMERCIAL
DISPUTE
RESOLUTION
PROCEDURES AND PROTOCOLS AND/OR CONTACT THE AAA OR
BBB BEFORE SIGNING. BY SIGNING YOU ACKNOWLEDGE THAT
YOU HAVE READ, UNDERSTAND AND AGREE TO BE BOUND BY
EACH OF THE PROVISIONS, COVENANTS, STIPULATIONS AND
AGREEMENTS SET FORTH AND REFERENCED HEREINABOVE.
"DESCRIPTION
OF
PRODUCTS/SERVICES:
________________"
(Capitalization and emphasis in original.)
6
1160372, 1160373, 1160374
In the blank line following the words "DESCRIPTION OF
PRODUCTS/SERVICES" typically was printed the year and
model of
the vehicle to be purchased as well as the vehicle-
identification number of that vehicle. Below that were lines
for the date to be filled in and lines for signatures of the
customer and a dealer representative. Each of the purchasers
signed the arbitration agreement in December 2015.
In July and August 2016, each of the purchasers sued
Locklear, as well as other defendants. Each purchaser alleged
that he or she was the victim of identity theft by an employee
of Locklear's who used the personal information from the
purchaser's credit application to purchase thousands of
dollars in cellular-telephone services. They asserted claims
of negligence, wantonness, invasion of privacy, conversion,
fraud, tort of outrage, civil conspiracy, violations of
Alabama's Consumer Identity Protection Act, and breach of
fiduciary duty. Shortly after filing their lawsuits, the
purchasers
sought
general
discovery,
including
interrogatories, requests for production of documents,
requests for admissions, and notices of deposition. The
7
1160372, 1160373, 1160374
general discovery requests regarded matters related to the
purchasers' substantive claims.
In response to the three actions, Locklear filed a motion
in each action seeking an order compelling arbitration staying
the action. The trial court held a hearing on the motions,
but did not rule on them.
Subsequently, each of the purchasers filed a motion to
compel Locklear's responses to their discovery requests and to
deem admitted their requests for admissions. The trial court
granted the purchasers' motions. Locklear then filed three
petitions for mandamus review, which this Court consolidated
for the purpose of writing one opinion. While the mandamus
petitions were pending, the trial court granted Locklear's
motions to stay discovery.
Standard of Review
"Mandamus is
an
extraordinary remedy and
will be
granted 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 Alfab, Inc.,
586 So. 2d 889, 891 (Ala. 1991). This Court will
not issue the writ of mandamus where the petitioner
has '"full and adequate relief"' by appeal. State v.
Cobb, 288 Ala. 675, 678, 264 So. 2d 523, 526 (1972)
8
1160372, 1160373, 1160374
(quoting State v. Williams, 69 Ala. 311, 316
(1881)).
"Discovery matters are within the trial court's
sound discretion, and this Court will not reverse a
trial court's ruling on a discovery issue unless the
trial court has clearly exceeded its discretion.
Home Ins. Co. v. Rice, 585 So. 2d 859, 862 (Ala.
1991). Accordingly, mandamus will issue to reverse
a trial court's ruling on a discovery issue only (1)
where there is a showing that the trial court
clearly exceeded its discretion, and (2) where the
aggrieved party does not have an adequate remedy by
ordinary appeal. The petitioner has an affirmative
burden to prove the existence of each of these
conditions."
Ex parte Ocwen Fed. Bank, FSB, 872 So. 2d 810, 813 (Ala.
2003).
Discussion
Locklear argues that, although discovery may be allowed
while a motion to compel arbitration is pending, that
discovery is limited to whether the parties to the arbitration
agreement must arbitrate their claims. Locklear argues that
the trial court exceeded its discretion in allowing general
discovery regarding the merits of the purchasers' claims.
Locklear argues that permitting general discovery to proceed
in a case that may be subject to arbitration could frustrate
one of the purposes underlying arbitration, namely, the
inexpensive and expedient resolution of disputes.
9
1160372, 1160373, 1160374
Locklear cites Ex parte Kenworth of Birmingham, Inc., 789
So. 2d 227 (Ala. 2000), in support of its position. In
Kenworth, the plaintiffs sued Kenworth and its salesman,
asserting claims arising out of the purchase of a truck. They
alleged that the salesman had represented that the truck was
new, when, in fact, the truck had been used and damaged, had
been repaired, had had parts replaced, and had been repainted
to appear new. Kenworth and the salesman answered the
complaint, raising several affirmative defenses and asserting
that the plaintiffs' claims were subject to arbitration. They
moved to stay the proceedings and to compel arbitration,
attaching a copy of a "Buyer's Order" that contained an
arbitration provision. In response to the motion to compel,
the plaintiffs asserted that they did not recall an
arbitration provision in the paperwork underlying the sale of
the truck and that the signature on the paperwork was not
theirs.
On the day of the hearing on the motion to stay and to
compel arbitration, Kenworth and the salesman moved in open
court to continue the hearing and requested leave to conduct
discovery. The trial court rescheduled the hearing on the
10
1160372, 1160373, 1160374
motion to compel arbitration and ordered that discovery would
not be stayed pending the hearing, nor would discovery be
limited to the issue of the genuineness of the signature on
the buyer's order containing the arbitration provision.
Both sides in Kenworth filed notices of depositions. A
week before the scheduled depositions, Kenworth and the
salesman moved for what they called a "reconsideration" and to
stay discovery, arguing that they had made a prima facie
showing that the arbitration provision was enforceable. The
trial court denied that motion and further stated that "'there
is no "prima facie showing that the arbitration agreement is
enforceable."'" 789 So. 2d at 229. The court then reset the
hearing on the motion to compel arbitration. Kenworth and the
salesman petitioned this Court for the writ of mandamus before
the hearing could be held. They argued that the trial court
exceeded its discretion by allowing unrestricted discovery
before a resolution of the question whether the plaintiffs
must arbitrate their claims. This Court agreed, holding that,
although the trial court did not err in allowing the parties
to conduct discovery, it did err in failing to restrict that
11
1160372, 1160373, 1160374
discovery to the question whether the plaintiffs had agreed to
arbitrate their dispute with Kenworth and the salesman.
We note that, in the instant case, this Court is not
reviewing a trial court's order denying a motion to compel
arbitration; the trial court has not yet ruled on Locklear's
motion to compel. It is the trial court's general discovery
orders that are being challenged. Here, as in Kenworth, the
trial court exceeded its discretion by allowing general
discovery before the resolution of the issue whether the
purchasers must arbitrate their claims. In Ex parte Jim Burke
Automotive, Inc., 776 So. 2d 118 (Ala. 2000), this Court
explained that, although it was not error for the trial court
to allow the parties to conduct discovery prior to
arbitration, it was error not to limit the discovery to the
question whether the plaintiff agreed to arbitrate his claims
and that such limited discovery did not constitute a waiver of
the right to arbitrate. Here, the purchasers have not
requested discovery on an issue related to the arbitration
agreement; instead, they sought general discovery regarding
the merits of their claims. In granting the purchasers'
requests for general discovery before the resolution of
12
1160372, 1160373, 1160374
Locklear's arbitration motions, the trial court exceeded its
discretion. Furthermore, because it would be unfair to
require Locklear conduct merit-based discovery prior to
deciding the arbitration issue, and because Locklear could not
be afforded the relief it seeks after that discovery has been
conducted, Locklear does not have an adequate remedy by
ordinary appeal. Accordingly, we grant the petitions and
issue the writs, directing the trial court to vacate its
orders requiring Locklear to respond to the purchasers'
discovery requests, including the requests for admissions and
to sit for depositions.
1160372 -- PETITION GRANTED; WRIT ISSUED.
1160373 -- PETITION GRANTED; WRIT ISSUED.
1160374 -- PETITION GRANTED; WRIT ISSUED.
Stuart, C.J., and Parker, Murdock, Shaw, Main, Wise,
Bryan, and Sellers, JJ., concur.
13 | September 29, 2017 |
9330b554-5151-457e-9604-5f014ba67d0a | Casey Marie Wilkes and Alexander Jack Russell v. PCI Gaming Authority d/b/a Wind Creek Casino and Hotel Wetumpka, and Poarch Band of Creek Indians | N/A | 1151312 | Alabama | Alabama Supreme Court | REL: 09/29/2017
REL: 10/03/2017 As modified on rehearing ex mero motu [by substitution of pages 10-11].
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
SPECIAL TERM, 2017
____________________
1151312
____________________
Casey Marie Wilkes and Alexander Jack Russell
v.
PCI Gaming Authority d/b/a Wind Creek Casino and Hotel
Wetumpka, and Poarch Band of Creek Indians
Appeal from Elmore Circuit Court
(CV-15-900057)
STUART, Chief Justice.
Casey Marie Wilkes and Alexander Jack Russell appeal the
summary judgment entered by the Elmore Circuit Court in favor
of PCI Gaming Authority d/b/a Wind Creek Casino and Hotel
1151312
Wetumpka ("Wind Creek-Wetumpka"), and the Poarch Band of
Creek
Indians (hereinafter referred to collectively as "the tribal
defendants"),1 on negligence and wantonness claims asserted by
Wilkes and Russell seeking compensation for injuries they
received when an automobile driven by Wilkes was involved in
a collision with a pickup truck belonging to Wind Creek-
Wetumpka and being driven by Barbie Spraggins, an employee at
Wind Creek-Wetumpka. We reverse and remand.
I.
Spraggins began working as a facilities-management
administrator at Wind Creek-Wetumpka in November 2013.
During
the course of her employment, one of her supervisors reported
her to higher level management at least six times because she
smelled of alcohol while at work. On at least two occasions,
Spraggins was tested for alcohol as a result of those reports,
and a blood test taken on February 13, 2014, revealed that she
had a blood-alcohol content of .078 while at work. Spraggins
was
eventually
referred
to
an
employee-assistance program,
and
1The Poarch Band of Creek Indians is an Alabama Indian
tribe that owns PCI Gaming Authority and Wind Creek-Wetumpka.
PCI Gaming Authority operates Wind Creek-Wetumpka.
2
1151312
she saw a counselor in conjunction with that program from
March through September 2014.
The record indicates that, on January 1, 2015, Spraggins
arrived for work at approximately 8:00 a.m. after drinking
much of the night. At some point after arriving at work, she
decided to travel to a warehouse maintained by Wind Creek-
Wetumpka approximately 10 miles away in Montgomery to
retrieve
lamp shades that were needed for some hotel rooms at Wind
Creek-Wetumpka. Spraggins was authorized to use a Wind Creek-
Wetumpka vehicle for such purposes, and she took a 2008
Chevrolet Silverado pickup truck on that occasion. It is
unclear exactly where Spraggins traveled after picking up the
lamp shades at the Montgomery warehouse; however, at
approximately 10:50 a.m., the pickup truck she was driving
struck a guardrail while crossing the Mortar Creek bridge on
Alabama State Highway 14 outside of Elmore, crossed into
oncoming traffic, and was involved in a head-on collision with
a vehicle being driven by Wilkes. Spraggins, Wilkes, and
Russell, a passenger in Wilkes's vehicle, were all
transported
to the Baptist Medical Center South hospital in Montgomery for
medical treatment following the accident, and a blood test
3
1151312
administered at the hospital revealed that Spraggins had a
blood-alcohol content of .293 approximately 1 hour and 45
minutes after the collision. Spraggins has since been unable
to recall why she was traveling on the Mortar Creek bridge at
the time of the collision; that location is approximately
eight miles west of Wind Creek-Wetumpka and not on the route
to the warehouse where she picked up the lamp shades.
On February 16, 2015, Wilkes and Russell sued Spraggins
and the tribal defendants in the Elmore Circuit Court.2 As
subsequently amended, Wilkes and Russell's complaint asserted
negligence and wantonness claims against Spraggins and the
tribal defendants based on Spraggins's operation of
the
pickup
truck at the time of the January 2015 accident, and negligence
and wantonness claims against the tribal defendants based on
their hiring, retention, and supervision of Spraggins.3
Following a period of discovery, the tribal defendants moved
the trial court to enter a summary judgment in their favor,
2Progressive
Specialty
Insurance
Company,
Wilkes's
insurer, was also named as a defendant. It is not a party to
this appeal.
3Spraggins's employment at Wind Creek-Wetumpka was
terminated before she could return to work following the
January 2015 accident.
4
1151312
arguing that the Poarch Band of Creek Indians was a federally
recognized Indian tribe and that they were accordingly
protected by the doctrine of tribal sovereign immunity or,
alternatively, that Spraggins was not acting within the scope
of her employment at the time of the January 2015 accident.
Wilkes and Russell opposed the tribal defendants' summary-
judgment motion; however, on June 7, 2016, the trial court
granted the tribal defendants' motion and entered a summary
judgment in their favor, holding that it
lacked subject-matter
jurisdiction over the dispute because of the tribal sovereign
immunity held by the tribal defendants. On August 10, 2016,
the trial court certified its judgment as final pursuant to
Rule 54(b), Ala. R. Civ. P., and, on September 20, 2016,
Wilkes and Russell filed their notice of appeal to this Court.
II.
Wilkes and Russell seek the reversal of the summary
judgment entered by the trial court holding that the tribal
defendants are protected from suit by the doctrine of tribal
sovereign immunity. This Court has stated:
"This Court's review of a summary judgment is de
novo. Williams v. State Farm Mut. Auto. Ins. Co.,
886 So. 2d 72, 74 (Ala. 2003). We apply the same
standard of review as the trial court applied.
5
1151312
Specifically, we must determine whether the movant
has made a prima facie showing that no genuine issue
of material fact exists and that the movant is
entitled to a judgment as a matter of law. Rule
56(c), Ala. R. Civ. P.; Blue Cross & Blue Shield of
Alabama v. Hodurski, 899 So. 2d 949, 952-53 (Ala.
2004). In making such a determination, we must
review the evidence in the light most favorable to
the nonmovant. Wilson v. Brown, 496 So. 2d 756, 758
(Ala. 1986). Once the movant makes a prima facie
showing that there is no genuine issue of material
fact, the burden then shifts to the nonmovant to
produce 'substantial evidence' as to the existence
of a genuine issue of material fact. Bass v.
SouthTrust Bank of Baldwin County, 538 So. 2d 794,
797-98 (Ala. 1989); Ala. Code 1975, § 12-21-12."
Dow v. Alabama Democratic Party, 897 So. 2d 1035, 1038-39
(Ala. 2004).
III.
The issue presented in this appeal is whether the
doctrine of tribal sovereign immunity shields the tribal
defendants from the tort claims asserted by Wilkes and
Russell. In Michigan v. Bay Mills Indian Community, ___ U.S.
___, ___, 134 S. Ct. 2024, 2030-31 (2014), the Supreme Court
of the United States explained tribal sovereign immunity as
follows:
"Indian
tribes
are
'"domestic
dependent
nations"'
that
exercise
'inherent
sovereign
authority.' Oklahoma Tax Comm'n v. Citizen Band
Potawatomi Tribe of Okla., 498 U.S. 505, 509 (1991)
(Potawatomi) (quoting Cherokee Nation v. Georgia, 5
6
1151312
Pet. 1, 17 (1831)). As dependents, the tribes are
subject to plenary control by Congress. See United
States v. Lara, 541 U.S. 193, 200 (2004) ('[T]he
Constitution grants Congress' powers 'we have
consistently described as "plenary and exclusive"'
to 'legislate in respect to Indian tribes'). And
yet they remain 'separate sovereigns pre-existing
the Constitution.' Santa Clara Pueblo v. Martinez,
436 U.S. 49, 56 (1978). Thus, unless and 'until
Congress acts, the tribes retain' their historic
sovereign authority. United States v. Wheeler, 435
U.S. 313, 323 (1978).
"Among the core aspects of sovereignty that
tribes possess –- subject, again, to congressional
action –- is the 'common-law immunity from suit
traditionally enjoyed by sovereign powers.' Santa
Clara Pueblo, 436 U.S., at 58. That immunity, we
have explained, is 'a necessary corollary to Indian
sovereignty and self-governance.' Three Affiliated
Tribes of Fort Berthold Reservation v. Wold
Engineering, P.C., 476 U.S. 877, 890 (1986); cf. The
Federalist No. 81, p. 511 (B. Wright ed. 1961) (A.
Hamilton) (It is 'inherent in the nature of
sovereignty not to be amenable' to suit without
consent). And the qualified nature of Indian
sovereignty modifies that principle only by placing
a tribe's immunity, like its other governmental
powers and attributes, in Congress's hands. See
United States v. United States Fidelity & Guaranty
Co., 309 U.S. 506, 512 (1940) (USF & G) ('It is as
though the immunity which was theirs as sovereigns
passed to the United States for their benefit').
Thus, we have time and again treated the 'doctrine
of tribal immunity [as] settled law' and dismissed
any suit against a tribe absent congressional
authorization (or a waiver). Kiowa Tribe of Okla.
v. Manufacturing Technologies, Inc., 523 U.S. 751,
756 (1998)."
7
1151312
However, notwithstanding the fact that the doctrine of tribal
sovereign immunity is generally considered to be settled law,
the Supreme Court of the United States has recognized that the
doctrine is a common-law doctrine that "developed almost by
accident,"
Kiowa
Tribe
of
Oklahoma
v.
Manufacturing
Technologies, Inc., 523 U.S. 751, 756 (1998), inasmuch as
there is no congressional statute or treaty defining the
doctrine and, importantly, what, if any, limits the doctrine
may have. Although the principle that tribes have the power
"to make their own substantive law in internal matters ... and
to enforce that law in their own forums" is relatively clear
and accepted, Santa Clara Pueblo v. Martinez, 436 U.S. 49, 55-
56 (1978), the application of the doctrine of tribal sovereign
immunity becomes murkier when tribes interact with those who
are not members of the tribes. See New Mexico v. Mescalero
Apache Tribe, 462 U.S. 324, 332 (1983) (stating that "[a]
tribe's power to prescribe the conduct of tribal members has
never been doubted").
In the absence of any foundational statute or treaty, it
has accordingly been left to the Supreme Court of the United
States to define the limits of tribal sovereign immunity in
8
1151312
situations where tribal and non-tribal members interact,
although that Court has repeatedly expressed its willingness
to defer to Congress should Congress act in this arena. See,
e.g., Bay Mills, ___ U.S. at ___, 134 S.Ct. at 2037 ("[I]t is
fundamentally Congress's job, not ours, to determine whether
or how to limit tribal immunity."), and Kiowa, 523 U.S. at 759
("Although the Court has taken the lead in drawing the bounds
of tribal immunity, Congress, subject to constitutional
limitations,
can
alter
its
limits
through
explicit
legislation."). In Kiowa, the Court extended the tribal-
sovereign-immunity doctrine to shield tribes from lawsuits
asserting contract claims based on commercial activities
conducted outside tribal lands; however, the Court for the
first time also expressed its reservations about perpetuating
the doctrine, explaining:
"There are reasons to doubt the wisdom of
perpetuating the doctrine. At one time, the
doctrine of tribal immunity from suit might have
been thought necessary to protect nascent tribal
governments from encroachments by States. In our
interdependent and mobile society, however, tribal
immunity extends beyond what is needed to safeguard
tribal self-governance. This is evident when tribes
take part in the Nation's commerce. Tribal
enterprises now include ski resorts, gambling, and
sales of cigarettes to non-Indians. See Mescalero
Apache Tribe v. Jones, 411 U.S. 145 (1973);
9
1151312
[Oklahoma Tax Comm'n v. Citizen Band of] Potawatomi
[Indian Tribe of Oklahoma, 498 U.S. 505, 510
(1991)]; Seminole Tribe of Fla. v. Florida, 517 U.S.
44 (1996). In this economic context, immunity can
harm those who are unaware that they are dealing
with a tribe, who do not know of tribal immunity, or
who have no choice in the matter, as in the case of
tort victims.
"These considerations might suggest a need to
abrogate tribal immunity, at least as an overarching
rule. Respondent does not ask us to repudiate the
principle outright, but suggests instead that we
confine it to reservations or to noncommercial
activities. We decline to draw this distinction in
this case, as we defer to the role Congress may wish
to exercise in this important judgment.
"....
"In light of these concerns, we decline to
revisit our case law and choose to defer to
Congress. Tribes enjoy immunity from suits on
contracts,
whether
those
contracts
involve
governmental or commercial activities and whether
they were made on or off a reservation. Congress
has not abrogated this immunity, nor has petitioner
waived it, so the immunity governs this case."
523 U.S. at 758-60 (emphasis added).
We take particular notice of the Court's comment that
tribal sovereign immunity hurts most those who "have no choice
in the matter" and the Court's limitation of its holding in
Kiowa to "suits on contract." Id. In Bay Mills, the Supreme
Court further recognized this limitation, explaining in a
footnote that it had never "specifically addressed (nor, so
[substituted p. 10]
1151312
far as we are aware, has Congress) whether immunity should
apply in the ordinary way if a tort victim, or other plaintiff
who has not chosen to deal with a tribe, has no alternative
way to obtain relief for off-reservation commercial conduct."
___ U.S. at ___ n. 8, 134 S.Ct. at 2036 n. 8. This appeal
presents precisely that scenario: Wilkes and Russell have
alleged tort claims against the tribal defendants, and they
have no way to obtain relief if the doctrine of tribal
sovereign immunity is applied to bar their lawsuit.
In light of the fact that the Supreme Court of the United
States has expressly acknowledged that it has never applied
tribal sovereign immunity in a situation such as this, we
decline to extend the doctrine beyond the circumstances to
which that Court itself has applied it; accordingly, we hold
that the doctrine of tribal sovereign immunity affords the
tribal defendants no protection from the claims asserted by
Wilkes and Russell. As Justice Stevens aptly explained in his
dissent in Kiowa, a contrary holding would be contrary to the
interests of justice, especially inasmuch as the tort victims
in this case had no opportunity to negotiate with the tribal
[substituted p. 11]
1151312
defendants for a waiver of immunity. See Kiowa, 523 U.S. at
766 (Stevens, J., dissenting) ("[T]he rule [set forth by the
majority] is unjust. This is especially so with respect to
tort victims who have no opportunity to negotiate for a waiver
of sovereign immunity; yet nothing in the Court's reasoning
limits the rule to lawsuits arising out of voluntary
contractual relationships. Governments, like individuals,
should pay their debts and should be held accountable for
their unlawful, injurious conduct.").
Wilkes and Russell did not voluntarily choose to engage
in a transaction with the tribal defendants; rather, they were
merely traveling on the public roads of this State when they
were injured in an automobile accident involving –– and, by
all accounts, caused by –– a Wind Creek-Wetumpka employee
driving a Wind Creek-Wetumpka vehicle. Thus, to the extent
the Bay Mills Court buttressed its decision affording tribal
sovereign immunity to tribes with regard to claims stemming
from a tribe's commercial activities by reasoning that
plaintiffs could "bargain for a waiver of immunity"
beforehand, ___ U.S. at ___, 134 S.Ct. at 2035, that rationale
has no application to the tort claims asserted by Wilkes and
12
1151312
Russell. Moreover, for the reasons explained by Justice
Thomas in his dissent in Bay Mills, we likewise conclude that
none of the other rationales offered by the majority in Bay
Mills as support for continuing to apply the doctrine of
tribal
sovereign
immunity
to
tribes'
off-reservation
commercial activities sufficiently outweigh the interests of
justice so as to merit extending that doctrine to shield
tribes from tort claims asserted by individuals who have no
personal or commercial relationship to the tribe. See Bay
Mills, ___ U.S. at ___, 134 S.Ct. at 2045-55 (Thomas, J.,
dissenting) (explaining that the doctrine of tribal sovereign
immunity as articulated by the Supreme Court in Kiowa lacks
"substantive justification" and the majority's reasons for
continuing to uphold the doctrine –– deference to Congress,
stare decisis, etc. –– are insufficient in light of that lack
of a justification, and the "unfairness and conflict it has
engendered").
IV.
Wilkes and Russell asserted negligence and wantonness
claims against the tribal defendants as a result of injuries
sustained in an automobile accident involving a vehicle owned
13
1151312
by Wind Creek-Wetumpka and being driven by a Wind Creek-
Wetumpka employee. The trial court entered a summary judgment
in favor of the tribal defendants on the ground of tribal
sovereign immunity, and Wilkes and Russell appealed that
judgment to this Court. We now reverse the judgment of the
trial court and hold that the doctrine of tribal sovereign
immunity affords no protection to tribes with regard to tort
claims asserted against them by non-tribe members. In so
holding, we are mindful that "tribal immunity is a matter of
federal law and is not subject to diminution by the States,"
Kiowa, 523 U.S. at 756, and that our holding is contrary to
the holdings of several of the United States Courts of Appeals
that have considered this issue. See, e.g., Arizona v. Tohono
O'odham Nation, 818 F.3d 549, 563 n. 8 (9th Cir. 2016) ("We
have held that tribal sovereign immunity bars tort claims
against an Indian tribe, and that remains good law.").
However, as explained supra, the Supreme Court of the United
States has expressly acknowledged that it has not ruled on the
issue whether the doctrine of tribal sovereign immunity has a
field of operation with regard to tort claims, and this Court
is not bound by decisions of lower federal courts. See Ex
14
1151312
parte Johnson, 993 So. 2d 875, 886 (Ala. 2008) ("This Court is
not bound by decisions of the United States Courts of Appeals
or the United States District Courts ...."), and Preferred
Risk Mut. Ins. Co. v. Ryan, 589 So. 2d 165, 167 n. 2 (Ala.
1991) ("Decisions of federal courts other than the United
States Supreme Court, though persuasive, are not binding
authority on this Court."). Accordingly, in the interest of
justice we respectfully decline to extend the doctrine of
tribal sovereign immunity beyond the circumstances in which
the Supreme Court of the United States itself has applied it.
The judgment of the trial court holding that it lacked
jurisdiction to consider the claims asserted by Wilkes and
Russell based on the doctrine of tribal sovereign immunity is
accordingly reversed and the cause remanded for further
proceedings consistent with this opinion.
REVERSED AND REMANDED.
Bolin, Parker, Murdock, Main, Bryan, and Sellers, JJ.,
concur.
Shaw and Wise, JJ., recuse themselves.
15 | October 3, 2017 |
3199622c-c4cd-4453-93e4-cccb9af57dfa | Ex parte Dow Corning Alabama, Inc. | N/A | 1160028 | Alabama | Alabama Supreme Court | REL: 09/01/2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
SPECIAL TERM, 2017
____________________
1160028
____________________
Ex parte Dow Corning Alabama, Inc., et al.
PETITION FOR WRIT OF MANDAMUS
(In re: Alabama Electric Company, Inc., of Dothan and
National Trust Insurance Company
v.
Dow Corning Alabama, Inc., et al.)
(Houston Circuit Court, CV-14-900316)
SELLERS, Justice.
Dow Corning Alabama, Inc., Dow Corning Corporation,
Rajesh Mahadasyam, Fred McNett, Zurich American Insurance
1160028
Company ("Zurich"), and National Union Insurance Company of
Pittsburgh, PA ("National Union"), petition this Court for a
writ of mandamus directing the trial court to transfer the
underlying declaratory-judgment action to the Montgomery
Circuit Court pursuant to § 6–3–21.1, Ala. Code 1975, the
forum non conveniens statute. We deny the petition.
Facts
Alabama Electric Company, Inc., of Dothan ("Alabama
Electric") is an Alabama corporation with its principal place
of business in Houston County. Dow Corning Alabama is a
Delaware corporation with its principal place of business in
Montgomery County.
Dow
Corning
Alabama
hired
Alabama
Electric,
an
independent
contractor, to perform
the
electrical
installation of a vacuum system at Dow Corning Alabama's
facility in Montgomery. The master construction contract
("the master contract") between the parties includes the
following indemnity provision:
"[Section 15.01] INDEMNITY - [Alabama Electric]
assumes all risk and liability for provision of the
Work and agrees to defend, indemnify and hold
harmless [Dow Corning Alabama], its subsidiaries and
affiliated companies and their officers, directors,
agents, employees and assigns (each 'Indemnified
Party'), from and against all claims, including
claims of bodily injury or death, all damages,
2
1160028
losses and expenses, including attorneys' fees and
expenses, arising out of or resulting from the
negligent acts or omissions of [Alabama Electric],
[its] employees, representatives subcontractors and
independent contractors under [Alabama Electric's]
supervision and control while on [Dow Corning
Alabama's] premises or traveling to or from [Dow
Corning Alabama's] premises for the purpose of
performing Work, regardless of whether caused in
part by [Dow Corning Alabama]."
(Emphasis added.) Section 16.02 of the master contract
requires Alabama Electric to maintain "Commercial General
Liability
Insurance
...
providing
standard
coverage
including,
but not limited to, insurance for any and all public liability
including bodily injury, property damage, personal injury, or
advertising injury to others, arising from or related to
[Alabama Electric's] performance under this agreement."
(Emphasis added.) Section 16.02 of the master contract also
states that "[Dow Corning Alabama] shall be added as an
additional insured for the coverages listed in b. [i.e.,
commercial
general-liability
insurance]
and
c.
[i.e.,
automobile-liability insurance] above, with respect to
occurrences
arising
out
of
[Alabama
Electric's]
negligent
acts
or omissions." (Emphasis added.) In accordance with the
master contract, Alabama Electric's insurer, National Trust
Insurance Company ("National Trust"), issued to Alabama
3
1160028
Electric
a
commercial
general-liability
insurance
policy
("the
National Trust policy") for the period March 31, 2011, through
March 31, 2012.
On August 1, 2011, Scottie Blue, an employee of Alabama
Electric, was injured while working at Dow Corning Alabama's
Montgomery facility. On March 28, 2013, Blue filed a
personal-injury action in the Montgomery Circuit Court ("the
Montgomery lawsuit"), naming as defendants Dow Corning
Alabama, Dow Corning Corporation, Rajesh Mahadasyam, and Fred
McNett ("the Dow defendants"). The Dow defendants tendered
their request for defense and indemnity of the Montgomery
lawsuit to Alabama Electric and National Trust, both of whom
denied coverage.
On April 28, 2014, Zurich and National Union (hereinafter
referred to collectively as "the Dow insurers") settled the
Montgomery lawsuit through mediation, and the case was
ultimately dismissed.
On May 9, 2014, Alabama Electric and National Trust filed
an action in the Houston Circuit Court seeking certain
declarations concerning their
duties
and
obligations
under
the
master contract and/or the National Trust policy regarding the
4
1160028
settlement. Alabama Electric and National Trust argued
primarily that the indemnity provision of the master contract
required them to defend and indemnify only those claims based
on
Alabama
Electric's
negligence.
Alabama
Electric
emphasized
that all the claims asserted by Blue in his complaint were
based on the alleged wrongful acts or omissions of the Dow
defendants. Alabama Electric and National Trust subsequently
amended their complaint to add the Dow insurers based on the
Dow defendants' assertion that they had assigned to the Dow
insurers their legal rights to sue Alabama Electric and
National Trust.
On November 3, 2014, the Dow defendants moved to transfer
the declaratory-judgment action from Houston County to
Montgomery County
pursuant
to
the
interest-of-justice prong
of
§ 6-3-21.1. In their motion to transfer, the Dow defendants
argued that Montgomery County had a "much stronger connection"
to the declaratory-judgment action because Blue's accident
occurred in Montgomery County, Montgomery County was the site
of
Alabama
Electric's
alleged
negligent
conduct,
and
Montgomery County is where Blue filed his action. They argued
that, in contrast, Houston County had little connection to the
5
1160028
declaratory-judgment action other than being the location of
Alabama Electric's principal place of business. Alabama
Electric and National Trust argued in response that Houston
County has a strong interest in the adjudication of their
declaratory-judgment action because, they said, the issues
presented are solely whether Alabama Electric owes indemnity
under the master contract, which was executed in Houston
County, and whether National Trust owes indemnity under its
policy of insurance, which was issued in Houston County. At
some point thereafter, the Dow insurers also filed a motion to
transfer the action to Montgomery County, asserting the same
grounds as did the Dow defendants. After considering briefs
from the parties and conducting a hearing, the trial court
entered an order denying the motions to transfer, concluding
that the Dow defendants and the Dow insurers had failed to
meet their burden of showing that the requested transfer to
Montgomery County was justified, based on the interest of
justice, under § 6-3-21.1. The trial court specifically
determined that the claims asserted by the Dow defendants and
the Dow insurers arise, if at all, from the master contract or
from the National Trust policy.
6
1160028
The Dow defendants and the Dow insurers (hereinafter
sometimes referred to collectively as "the Dow parties") then
filed this petition for a writ of mandamus, requesting that
this Court order the trial court to transfer the underlying
declaratory-judgment action from the Houston Circuit Court to
the Montgomery Circuit Court. This Court ordered answers and
briefs.
Standard of Review
"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)."
Ex parte National Sec. Ins. Co., 727 So. 2d 788, 789 (Ala.
1998).
7
1160028
Discussion
The Dow parties contend that the trial court exceeded
its discretion in denying their motion to transfer the
declaratory-judgment action to Montgomery County under the
"interest-of-justice" prong of § 6-3-21.1, which provides, in
pertinent part:
"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 and the case shall proceed
as though originally filed therein."
(Emphasis added.) "A [party] 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." Ex parte
Masonite Corp., 789 So. 2d 830, 831 (Ala. 2001)(emphasis
added). In this case, it is undisputed that venue is
appropriate in both Houston County, see § 6–3–7(a)(2), Ala.
Code 1975 ("All civil actions against corporations may be
brought ... [i]n the county of the corporation's principal
office in this state ...."), and Montgomery County. "When
venue is appropriate in more than one county, the plaintiff's
8
1160028
choice of venue is generally given great deference." Ex parte
Perfection Siding, Inc., 882 So. 2d 307, 312 (Ala. 2003).
Accordingly, this Court must determine "whether 'the interest
of justice' overrides the deference due the
plaintiff's choice
of forum. Our inquiry depends on the facts of the case." Ex
parte J & W Enters., LLC, 150 So. 3d 190, 194 (Ala. 2014).
"The 'interest of justice' prong of § 6–3–21.1
requires '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.'
Ex parte National Sec. Ins. Co., 727 So. 2d [788,]
790 [(Ala. 1998)]. Therefore, 'in analyzing the
interest-of-justice prong of § 6–3–21.1, this Court
focuses on whether the "nexus" or "connection"
between the plaintiff's action and the original
forum is strong enough to warrant burdening the
plaintiff's forum with the action.' Ex parte First
Tennessee Bank Nat'l Ass'n, 994 So. 2d 906, 911
(Ala. 2008). Additionally, this Court has held that
'litigation should be handled in the forum where the
injury occurred.' Ex parte Fuller, 955 So. 2d 414,
416 (Ala. 2006). Further, in examining whether it is
in the interest of justice to transfer a case, we
consider 'the burden of piling court services and
resources upon the people of a county that is not
affected by the case and ... the interest of the
people of a county to have a case that arises in
their county tried close to public view in their
county.' Ex parte Smiths Water & Sewer Auth., 982
So. 2d 484, 490 (Ala. 2007). The petitioners in this
case are thus required to demonstrate '"that having
the case heard in [Montgomery] County would more
serve the interest of justice"' than having the case
heard in [Houston] County. Ex parte First Tennessee
Bank, 994 So. 2d at 909 (quoting Ex parte Fuller,
955 So. 2d 414, 416 (Ala. 2006))."
9
1160028
Ex parte Indiana Mills & Mfg., Inc., 10 So. 3d 536, 540 (Ala.
2008).
The Dow parties rely on the following three cases to
support their position that the trial court was compelled to
transfer
the
declaratory-judgment
action
to
Montgomery
County:
Ex parte American Resources Insurance Co., 58 So. 3d 118 (Ala.
2008)(holding that transfer to St. Clair County was not
warranted
under
the
interest-of-justice prong,
even
though
the
insured resided in St. Clair County and the insurance policy
was negotiated, issued, and delivered in St. Clair County; the
case did not involve issues whether policy was actually issued
or whether fraud or other wrongful conduct occurred--rather,
the only issue was whether the events alleged in complaint
fell within coverage of the policy); Ex parte International
Refining
&
Manufacturing
Co.,
67
So.
3d
870
(Ala.
2011)(holding that venue for insurer's declaratory-judgment
action against manufacturer was proper in county in which
former employees' litigation was proceeding); and Vulcan
Materials Co. v. Alabama Insurance Guaranty Ass'n, 985 So. 2d
376 (Ala. 2007)(holding that venue for insurer's declaratory-
judgment action was proper where insurers allegedly breached
10
1160028
their duty to indemnify manufacturer). Based on the specific
facts of this case, and for the reasons discussed below, we do
not agree with the Dow parties that these cases compel the
transfer of the declaratory-judgment action to Montgomery
County.
Although the Dow parties rely on Ex parte American
Resources, that case is actually supportive of Alabama
Electric and National Trust's position opposing the motion to
transfer. In Ex parte American Resources, a
general contractor
filed a lawsuit against its subcontractor in the Escambia
Circuit
Court,
alleging
defective
construction
of
a
condominium building in that county. The subcontractor's
insurer defended the Escambia County action under a
reservation of right. The insurer subsequently filed an
action
in the Mobile Circuit Court, seeking a judgment declaring
whether there had been an "occurrence" as defined in the
policy it had issued to the subcontractor. The trial court
granted
the
subcontractor's
motion
to
transfer
the
declaratory-judgment action to St. Clair County–-the location
of the subcontractor's principal place of business. This
Court concluded that the subcontractor had failed to meet its
11
1160028
burden of proving that transferring the case to St. Clair
County would serve the interest of justice more than leaving
the case in Mobile County–-the location of the insurer's
principal place of business. In so concluding, this Court
observed that, despite the subcontractor's contentions that
the insurance policy had been negotiated, issued, and
delivered in St. Clair County, the insurer filed its action in
Mobile County where its principal office was located and that
Mobile County appeared to have as much interest in the proper
resolution of a coverage dispute as did St. Clair County,
i.e., "[t]he only issue is whether the events that form the
basis for the Escambia County action fall within the coverage
of the policy." 58 So. 3d at 123. In the instant case,
Alabama Electric and National Trust chose to file their action
in Houston County–-the county not only where Alabama
Electric's principal place of business is located, but also
where the master contract was negotiated and delivered and
where the National Trust policy was issued and delivered.
Accordingly, Houston County appears to have as much interest
in the proper resolution of the indemnity dispute as does
Montgomery County.
12
1160028
In Ex parte International Refining, the plaintiffs,
former employees of a muffler plant, filed a lawsuit in the
Fayette Circuit Court against, among others, the
manufacturer
who supplied the muffler plant with allegedly toxic chemicals.
The manufacturer's insurer defended the manufacturer in the
action. While the action was proceeding in Fayette County, the
manufacturer's insurer filed an action in the Jefferson
Circuit Court seeking a judgment that it did not have a
"continuing duty" to defend the manufacturer in the Fayette
County action. The manufacturer moved the trial court to
transfer the insurer's declaratory-judgment action to Fayette
County pursuant to § 6-3-7, Ala. Code 1975, relating to venue
of actions against foreign and domestic corporations, arguing
that venue was proper only in Fayette County because a
substantial part of the events giving rise to the insurer's
declaratory-judgment action occurred there. This Court
agreed:
"The
act
giving
rise
to
[the
insurer's]
declaratory-judgment
action
against
[the
manufacturer]
is
not
the
initiation
of
the
contractual relationship between [the insurer] and
[the manufacturer]; instead, it is [the insurer's]
desire to be relieved of any obligation to defend
and/or to indemnify [the manufacturer] in the
[underlying]
litigation.
The
[underlying]
litigation
13
1160028
is proceeding in the Fayette Circuit Court, and that
litigation is the very litigation from which [the
insurer] is seeking relief from defending [the
manufacturer]. Therefore, a substantial part of the
events
giving
rise
to
[the
insurer's]
declaratory-judgment action arose in Fayette County.
Whether the remaining plaintiffs' claims in the
[underlying] litigation against [the manufacturer]
in the Fayette Circuit Court may be the subject of
indemnification by [the insurer] is a determination
to be made by the Fayette Circuit Court."
67 So. 3d at 876-77. In other words, the insurer in Ex parte
International Refining filed its declaratory-judgment action
in the Jefferson Circuit Court, seeking to be excused from
providing any further defense in the action that was already
proceeding in Fayette County. In the instant case, Alabama
Electric and National Trust never agreed to provide a defense
for the Dow defendants in the Montgomery lawsuit. Rather,
after the Dow insurers settled the Montgomery lawsuit on
behalf of the Dow defendants, but prior to the settlement
being finalized, Alabama Electric and National Trust filed the
declaratory-judgment action in Houston County seeking a
declaration that they were not obligated under the master
contract either to defend or to indemnify the Dow parties.
Moreover, the instant case involves the application of the
interest-of-justice
prong
of
§
6-3-21.1
and,
more
14
1160028
specifically, whether the Dow parties have met their burden of
demonstrating that having the declaratory-judgment action
heard in Montgomery County would better serve the interest of
justice.
Finally, in Vulcan Materials, the plaintiffs filed their
underlying lawsuit in California, alleging that Vulcan was
liable for environmental damage at 50 sites in that state.
Two of Vulcan's insurers filed insurance-coverage actions in
California. Thereafter, Vulcan filed a third insurance-
coverage action against the insurers in Alabama, seeking a
declaration regarding the insurers' duty to defend or
indemnify it in pending and future litigation in various
jurisdictions. The insurers moved to dismiss Vulcan's
declaratory-judgment action on forum non conveniens grounds
pursuant to § 6–5–430, Ala. Code 1975, a statute making the
doctrine of forum non conveniens applicable in an action
arising in a foreign jurisdiction:
"Section 6–5–430, Ala. Code 1975, provides:
"'Whenever, either by common law or
the statutes of another state or of the
United States, a claim,
either upon
contract or in tort has arisen outside this
state against any person or corporation,
such claim may be enforceable in the courts
15
1160028
of this state in any county in which
jurisdiction of the defendant can be
legally obtained in the same manner in
which
jurisdiction
could
have
been
obtained
if the claim had arisen in this state;
provided, however, the courts of this state
shall apply the doctrine of forum non
conveniens
in
determining
whether
to
accept
or decline to take jurisdiction of an
action based upon such claim originating
outside this state; and provided further
that, if upon motion of any defendant it is
shown that there exists a more appropriate
forum outside this state, taking into
account the location where the acts giving
rise
to
the
action
occurred,
the
convenience of the parties and witnesses,
and the interests of justice, the court
must
dismiss
the
action
without
prejudice....'
"Under this statute, the trial court 'shall apply
the doctrine of forum non conveniens' in determining
whether to decline or to take jurisdiction of an
action that has arisen outside the state so long as
the movants demonstrate that the following three
conditions are met: (1) the claim upon which the
present action is based originated outside Alabama;
(2) there is an alternative forum for this claim
outside Alabama; and (3) the factors considered in
determining the applicability of the doctrine."
Relative to the trial court's consideration was the fact
that the insurance-coverage actions pending in California
involved identical issues, the same damage locations, and
nearly identical parties. The trial court also considered the
fact that "[w]hether the various policies apply ... will
16
1160028
depend on how the contamination occurred, why it occurred, and
when it occurred—-all questions the answers to which will
depend on evidence gathered largely from the allegedly
contaminated sites." 985 So. 2d at 384 (emphasis added).
Accordingly, the trial court granted the insurers' motion to
dismiss the action filed in Alabama on forum non conveniens
grounds in favor of California, holding that the acts giving
rise to Vulcan's claim were the insurers' refusal to defend
and indemnify the actions pending in California. In affirming
the trial court's judgment, this Court emphasized:
"We reiterate that insurance-coverage actions
involving substantially the same parties, regarding
the
same
policies,
and
concerning
the
same
underlying litigation are currently pending in
California. By affirming the trial court's order
granting the [insurers'] motion for a dismissal
based on forum non conveniens, we are furthering the
interests of justice by avoiding a duplicative
action in Alabama. Permitting this case to go
forward in Alabama, while a case identical in all
material respects is pending in California, would
unnecessarily and unjustifiably burden the parties
and the respective judicial systems."
985 So. 2d at 384. The present declaratory-judgment action is
distinguishable insofar as it involves the applicability of
the interest-of-justice prong of § 6-3-21.1; the action does
not involve identical coverage actions in separate states that
17
1160028
would result in duplicative actions; and the action is not
dependent on evidence to be gathered from the Montgomery
action because the Dow insurers settled the action on behalf
of the Dow defendants.
We agree that the declaratory-judgment action in this
case has a connection to Montgomery County insofar as the
injury giving rise to the indemnity occurred in Montgomery and
Blue filed his action in the Montgomery Circuit Court.
"Although we assign 'considerable weight' to the location
where the accident occurred, it is not, and should not be, the
sole consideration for determining venue under the 'interest
of justice' prong of § 6-3-21.1." Ex parte J&W Enterprises,
150 So. 3d at 196-97. After the Dow insurers settled the
Montgomery action on behalf of the Dow defendants, Alabama
Electric and National Trust filed a declaratory-judgment
action, the central issue of which concerns their rights and
responsibilities under
the
master
contract
and/or
the
National
Trust policy to indemnify the Dow parties' for the defense and
settlement of the Montgomery action. Alabama Electric has its
principal place of business in Houston County; Alabama
Electric executed the master contract in Houston County; the
18
1160028
master contract was delivered in Houston County; all
communications related to the procurement of the National
Trust policy were conducted in Houston County; and National
Trust issued and delivered the National Trust policy in
Houston County. Given these facts, we conclude that the trial
court was within its discretion in finding that the Dow
parties had failed to meet their burden of showing that the
requested transfer to Montgomery County would better serve the
interest of justice because Houston County appears to have as
much, if not a greater, interest in the proper adjudication of
this declaratory-judgment action as does Montgomery County.
Accordingly, Alabama Electric and National Trust's choice of
forum should not be disturbed. The Dow parties did not
satisfy their burden at the trial-court level
of
demonstrating
that a change in venue from Houston County to Montgomery
County is warranted under the interest-of-justice prong of §
6-3-21.1. More importantly, the Dow parties have not
satisfied
the requisite burden of establishing that the trial court
exceeded its discretion in denying their motions for a change
of venue. See Ex parte Ben-Acadia, Ltd., 566 So. 2d 486, 488
(Ala. 1990) ("In cases involving the exercise of discretion by
19
1160028
a lower court, a writ of mandamus may issue to compel the
exercise of that discretion; however, it may not issue to
control the exercise of discretion except in a case of
abuse."); Ex parte Finance America Corp., 507 So. 2d 458, 460
(Ala. 1987) ("[A] writ of mandamus will not be granted unless
there is a clear showing of error on the part of the trial
judge.").
Conclusion
The trial court did not exceed its discretion in denying
the Dow parties' motions for a change of venue based on the
interest-of-justice prong of § 6-3-21.1. Accordingly, we
deny
their petition for a writ of mandamus.
PETITION DENIED.
Stuart, C.J., and Bolin, Parker, Main, and Wise, JJ.,
concur.
Murdock, Shaw, and Bryan, JJ., concur in the result.
20 | September 1, 2017 |
c1131ef6-9e8c-422b-b72b-3b545830568e | Ex parte Robert Przybysz | N/A | 1160381 | Alabama | Alabama Supreme Court | Rel: 09/01/2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
SPECIAL TERM, 2017
____________________
1160381
____________________
Ex parte Robert Przybysz, Ingenuity International, LLC,
David Byker, and Global Asset Management Holdings, LLC
PETITION FOR WRIT OF MANDAMUS
(In re: Nannette Smith and B2K Systems, Inc.
v.
B2K Systems, LLC, et al.)
(Jefferson Circuit Court, CV-14-163)
____________________
1160383
____________________
Ex parte Robert Przybysz, Ingenuity International, LLC,
David Byker, and Global Asset Management Holdings, LLC
PETITION FOR WRIT OF MANDAMUS
(In re: Global Asset Management Holdings, LLC
v.
B2K Systems, LLC)
(Jefferson Circuit Court, CV-14-369)
PARKER, Justice.
Robert
Przybysz,
Ingenuity
International,
LLC
("Ingenuity"), David Byker, and Global Asset Management
Holdings,
LLC
("GAM")
(hereinafter collectively
referred
to
as
"the defendants"), filed two petitions for a writ of mandamus
in this Court.1 Both petitions seek a writ ordering the
Jefferson Circuit Court ("the circuit court") to vacate the
portion of its order requiring Przybysz, Byker, and GAM to
dismiss an action they filed in the United States District
Court for the Northern District of Alabama ("the federal
1Each petition is directed to a different circuit court
number. It appears from the materials before this Court that
the two cases were consolidated in the circuit court early in
these proceedings and have traveled together since. The order
to which these petitions are addressed concerns both circuit
court case numbers.
2
1160381, 1160383
district court") against Nannette Smith alleging breach of a
settlement agreement between the parties.2
Facts and Procedural History
The parties have been involved in litigation concerning
a business dispute for several years. A detailed recitation
of the facts concerning the business dispute is not necessary
to analyze the issue raised in the defendants' mandamus
petitions. In summary, Smith and B2K Systems, Inc. ("B2K
Inc."), filed an action against the defendants and B2K
Systems, LLC ("B2K LLC"), in the circuit court asserting
various claims, and, at some point, GAM filed an action in the
circuit court against B2K LLC. The two cases were
consolidated in the circuit court. On November 15, 2016,
after years of litigation, the parties entered into a
settlement agreement, settling both cases.
As part of the settlement agreement, Byker and/or GAM
were to make an initial payment to Smith and then additional
payments over a 30-month period.3 In exchange, Smith agreed
2Ingenuity is named as a petitioner in both petitions even
though it was not a party in the action in the federal
district court.
3Przybysz and Ingenuity were involved with other aspects
of the settlement agreement, a detailed explanation of which
3
1160381, 1160383
to provide a business asset, which is the object of the
underlying litigation, to the defendants. Because the
settlement agreement required payments to be made over a 30-
month period, the circuit court did not enter a final judgment
on the settlement agreement, but placed the case on its
administrative docket with the intention of leaving it there
until the payments to Smith were satisfied. There is no
indication that a final judgment has been entered in the
underlying cases.
On December 19, 2016, Przybysz, Byker, and GAM sued Smith
in the federal district court asserting various claims based
on Smith's alleged breach of the settlement agreement. On
December 28, 2016, Smith and B2K Inc. filed an amended
complaint in the circuit court asserting additional claims
based on the defendants' alleged breach of the settlement
agreement. Smith and B2K Inc. also filed a motion requesting
that the circuit court find the defendants in contempt for
filing the action in the federal district court and assessing
sanctions against them. Lastly, Smith and B2K Inc. requested
is not necessary for purposes of resolving the petitions that
are the subject of this opinion.
4
1160381, 1160383
that the circuit court enter a consent judgment in their favor
in the amount of $750,000.
On January 30, 2017, following a hearing, the circuit
court entered an order denying Smith and B2K Inc.'s motion to
find the defendants in contempt. However, the circuit court
ordered Przybysz, Byker, and GAM to dismiss their action in
the federal district court:
"4. The court continues to retain jurisdiction
of this matter and of the execution of the
settlement per the agreement of the parties.
"5. The defendants are ORDERED and DIRECTED to
promptly dismiss any and all federal lawsuits filed
... pertaining to the settlement of this case or
purporting to seek enforcement of the settlement of
this case or relief from the terms of the
settlement."
(Capitalization in original.)
The defendants then filed their
petitions with this Court seeking mandamus relief.
Standard of Review
"A writ of mandamus will be granted 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
5
1160381, 1160383
invoked
jurisdiction
of
the
court.'"
"'Ex parte Ocwen Federal Bank, FSB, 872 So.
2d 810, 813 (Ala. 2003) (quoting Ex parte
Alfab, Inc., 586 So. 2d 889, 891 (Ala.
1991)). Mandamus will lie to direct a trial
court to vacate a void judgment or order.
Ex parte Chamblee, 899 So. 2d 244, 249
(Ala. 2004).'
"Ex parte Sealy, L.L.C., 904 So. 2d 1230, 1232 (Ala.
2004)."
Ex parte Courtyard Citiflats, LLC, 191 So. 3d 787, 789-90
(Ala. 2015).
Discussion
The defendants ask this Court to issue writs of mandamus
ordering the circuit court to vacate the portion of its
January 30, 2017, order requiring Przybysz, Byker, and GAM to
dismiss their federal lawsuit against Smith. Relying on
Donovan v. City of Dallas, 377 U.S. 408 (1964), the defendants
argue that the circuit court lacked the authority to order
Przybysz, Byker, and GAM to dismiss their federal lawsuit
against Smith. We agree and issue the writs.
In Donovan, a group of property owners near a municipal
airport filed a class action in a Texas trial court against
the municipality to restrain it from building a runway to
6
1160381, 1160383
service the municipal airport and from funding the project
through the issuance of bonds. The trial court entered a
summary judgment in favor of the municipality, and the summary
judgment was affirmed on appeal. Later, a group of citizens
of the municipality, including several members of the class
who filed the initial lawsuit in the Texas state court, filed
a class action in the United States District Court for the
Northern District of Texas against the municipality, among
others, seeking similar relief. The municipality filed an
answer to the class action in the federal court, but also
"applied to the Texas Court of Civil Appeals for a writ of
prohibition to bar all the plaintiffs in the case in the
United States District Court from prosecuting their case
there." 377 U.S. at 409. Initially, the Texas Court of Civil
Appeals
denied
the
municipality's application.
However,
after
being reversed by the Supreme Court of Texas, the Texas Court
of Civil Appeals
"issued a writ prohibiting all the plaintiffs in the
United States District Court case from any further
prosecution
of
that
case
and
enjoined
them
'individually and as a class ... from filing or
instituting ... any further litigation, law suits or
actions in any court, the purpose of which is to
contest the validity of the airport revenue bonds
7
1160381, 1160383
... or from in any manner interfering with the
proposed bonds ....'"
377 U.S. at 410. Subsequently, the United States District
Court for the Northern District of Texas dismissed the class
action, and the class-action plaintiffs appealed.
After the class-action plaintiffs appealed, the Texas
Court of Civil Appeals determined that several of the class-
action plaintiffs had violated the court's prohibition and
sanctioned the class-action plaintiffs. Although the United
States Supreme Court denied certiorari review of the United
States District Court for the Northern District of Texas's
dismissal of the class action, the United States Supreme Court
granted certiorari review "to
review the State Supreme Court's
judgment directing the Civil Court of Appeals to enjoin
petitioners from prosecuting their action in the federal
courts." Donovan, 377 U.S. at 411. In analyzing this issue,
the United States Supreme Court stated:
"Early in the history of our country a general
rule was established that state and federal courts
would not interfere with or try to restrain each
other's
proceedings.
That
rule
has
continued
substantially unchanged to this time. An exception
has been made in cases where a court has custody of
property, that is, proceedings in rem or quasi in
rem. In such cases this Court has said that the
state or federal court having custody of such
8
1160381, 1160383
property has exclusive jurisdiction to proceed.
Princess Lida v. Thompson, 305 U.S. 456, 465—468
[(1939)]. In Princess Lida this Court said 'where
the judgment sought is strictly in personam, both
the state court and the federal court, having
concurrent jurisdiction, may proceed with the
litigation at least until judgment is obtained in
one of them which may be set up as res judicata in
the other.' Id., 305 U.S. at 466. See also Kline v.
Burke Construction Co., 260 U.S. 226 [(1922)]. It
may be that a full hearing in an appropriate court
would justify a finding that the state-court
judgment in favor of [the municipality] in the first
suit barred the issues raised in the second suit, a
question as to which we express no opinion. But
plaintiffs in the second suit chose to file that
case in the federal court. They had a right to do
this, a right which is theirs by reason of
congressional
enactments
passed
pursuant
to
congressional policy. And whether or not a plea of
res judicata in the second suit would be good is a
question for the federal court to decide. While
Congress has seen fit to authorize courts of the
United States to restrain state-court proceedings in
some special circumstances, it has in no way relaxed
the old and well-established judicially declared
rule that state courts are completely without power
to restrain federal-court proceedings in in personam
actions like the one here. And it does not matter
that the prohibition here was addressed to the
parties rather than to the federal court itself. For
the heart of the rule as declared by this Court is
that:
"'... where the jurisdiction of a court,
and the right of a plaintiff to prosecute
his suit in it, have once attached, that
right cannot be arrested or taken away by
proceedings in another court. ... The fact,
therefore, that an injunction issues only
to the parties before the court, and not to
the
court,
is
no
evasion
of
the
9
1160381, 1160383
difficulties that are the necessary result
of an attempt to exercise that power over
a party ... who is a litigant in another
and independent forum.'12
"____________________
"12Peck v. Jenness, 7 How. 612, 625 [(1849)].
See also Central National Bank v. Stevens, 169 U.S.
432 [(1898)]; cf. Baltimore & O.R. Co. v. Kepner,
314 U.S. 44, 54, n. 23 ([1941)]."
Donovan, 377 U.S. at 412-13 (emphasis added; some footnotes
omitted).4 See also General Atomic Co. v. Felter, 434 U.S.
12, 17 (1977)("It is ... clear from Donovan [v. Dallas, 377
U.S. 408 (1964),] that the rights conferred by Congress to
bring in personam actions in federal courts are not subject to
abridgment by state-court injunctions, regardless of whether
the federal litigation is pending or prospective."). The
United States Supreme Court concluded that "[t]he Texas courts
were without power to take away this federal right by contempt
4This well established principle from Donovan has been
adopted in Alabama. See Moody v. State ex rel. Payne, 295
Ala. 299, 307, 329 So. 2d 73, 79 (1976)(recognizing "the
proposition stated in Donovan v. City of Dallas, 377 U.S 408,
84 S. Ct. 1579, 12 L. Ed. 2d 409 (1964), that 'state courts
are completely without power to restrain federal-court
proceedings in in personam actions'" and noting that this
principle was previously "cited and applied by this [C]ourt in
Johnson v. Brown-Service Ins. Co., 293 Ala. 549, 307 So. 2d
518 (1974)").
10
1160381, 1160383
proceedings or otherwise." Donovan, 377 U.S. at 413-14
(emphasis added).
The defendants argue that, "because this is an in
personam breach of contract action, as opposed to an in rem
proceeding, [the circuit court] is without authority to
enjoin
the federal action or order the [d]efendants to dismiss the
federal action." In their response, Smith and B2K Inc.5
recognize the application of the above-discussed principles
from Donovan. However, Smith and B2K Inc. appear to argue
that the circuit court has the authority to decide if a
federal district court would have jurisdiction over a pending
suit in the federal district court. Smith and B2K Inc.
conclude that, if the circuit court determines that a federal
district court does not have jurisdiction over the case, then
the circuit court may enjoin the action pending in the federal
district court.
In support of their argument, Smith and B2K Inc. cite
some cases for the unrelated proposition that "state courts
have the power and duty to construe questions of federal law."
5B2K Inc. is named as a respondent in both cases even
though it was not a party in the action in the federal
district court.
11
1160381, 1160383
However, none of those authorities stand for the proposition
asserted by Smith and B2K Inc. that a state court may
determine whether a federal court has jurisdiction over a case
filed in that federal court. Smith and B2K Inc.'s argument is
not supported by any relevant authority; thus, we need not
consider it further. See Jimmy Day Plumbing & Heating, Inc.
v. Smith, 964 So. 2d 1, 9 (Ala. 2007)("Rule 28(a)(10), Ala. R.
App. P., requires that arguments in an appellant's brief
contain 'citations to the cases, statutes, other authorities,
and parts of the record relied on.' Further, 'it is well
settled that a failure to comply with the requirements of Rule
28(a)(10) requiring citation of authority in support of the
arguments presented provides this Court with a basis for
disregarding those arguments.' State Farm Mut. Auto. Ins. Co.
v. Motley, 909 So. 2d 806, 822 (Ala. 2005)(citing Ex parte
Showers, 812 So. 2d 277, 281 (Ala. 2001)). This is so, because
'"it is not the function of this Court to do a party's legal
research or to make and address legal arguments for a party
based on undelineated general propositions not supported by
sufficient authority or argument."' Butler v. Town of Argo,
12
1160381, 1160383
871 So. 2d 1, 20 (Ala. 2003)(quoting Dykes v. Lane Trucking,
Inc., 652 So. 2d 248, 251 (Ala. 1994)).").
We agree with the defendants. Donovan makes clear that
the circuit court does not have the authority to order
Przybysz, Byker, and GAM to dismiss their federal action
against Smith; the defendants have demonstrated a clear legal
right to the relief they seek.
Conclusion
We grant the defendants' petitions and direct the circuit
court to vacate that portion of its order requiring Pryzbysz,
Byker, and GAM to dismiss their federal action against Smith.
1160381 -- PETITION GRANTED; WRIT ISSUED.
1160383 -- PETITION GRANTED; WRIT ISSUED.
Stuart, C.J., and Bolin, Shaw, Main, Wise, Bryan, and
Sellers, JJ., concur.
Murdock, J., concurs in the result.
13 | September 1, 2017 |
0559c5d5-ee33-4769-813d-618c14fb7680 | Ex parte Robert Przybysz, Ingenuity International, LLC, David Byker, and Global Asset Management Holdings, LLC. | N/A | 1160383 | Alabama | Alabama Supreme Court | Rel: 09/01/2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
SPECIAL TERM, 2017
____________________
1160381
____________________
Ex parte Robert Przybysz, Ingenuity International, LLC,
David Byker, and Global Asset Management Holdings, LLC
PETITION FOR WRIT OF MANDAMUS
(In re: Nannette Smith and B2K Systems, Inc.
v.
B2K Systems, LLC, et al.)
(Jefferson Circuit Court, CV-14-163)
____________________
1160383
____________________
Ex parte Robert Przybysz, Ingenuity International, LLC,
David Byker, and Global Asset Management Holdings, LLC
PETITION FOR WRIT OF MANDAMUS
(In re: Global Asset Management Holdings, LLC
v.
B2K Systems, LLC)
(Jefferson Circuit Court, CV-14-369)
PARKER, Justice.
Robert
Przybysz,
Ingenuity
International,
LLC
("Ingenuity"), David Byker, and Global Asset Management
Holdings,
LLC
("GAM")
(hereinafter collectively
referred
to
as
"the defendants"), filed two petitions for a writ of mandamus
in this Court.1 Both petitions seek a writ ordering the
Jefferson Circuit Court ("the circuit court") to vacate the
portion of its order requiring Przybysz, Byker, and GAM to
dismiss an action they filed in the United States District
Court for the Northern District of Alabama ("the federal
1Each petition is directed to a different circuit court
number. It appears from the materials before this Court that
the two cases were consolidated in the circuit court early in
these proceedings and have traveled together since. The order
to which these petitions are addressed concerns both circuit
court case numbers.
2
1160381, 1160383
district court") against Nannette Smith alleging breach of a
settlement agreement between the parties.2
Facts and Procedural History
The parties have been involved in litigation concerning
a business dispute for several years. A detailed recitation
of the facts concerning the business dispute is not necessary
to analyze the issue raised in the defendants' mandamus
petitions. In summary, Smith and B2K Systems, Inc. ("B2K
Inc."), filed an action against the defendants and B2K
Systems, LLC ("B2K LLC"), in the circuit court asserting
various claims, and, at some point, GAM filed an action in the
circuit court against B2K LLC. The two cases were
consolidated in the circuit court. On November 15, 2016,
after years of litigation, the parties entered into a
settlement agreement, settling both cases.
As part of the settlement agreement, Byker and/or GAM
were to make an initial payment to Smith and then additional
payments over a 30-month period.3 In exchange, Smith agreed
2Ingenuity is named as a petitioner in both petitions even
though it was not a party in the action in the federal
district court.
3Przybysz and Ingenuity were involved with other aspects
of the settlement agreement, a detailed explanation of which
3
1160381, 1160383
to provide a business asset, which is the object of the
underlying litigation, to the defendants. Because the
settlement agreement required payments to be made over a 30-
month period, the circuit court did not enter a final judgment
on the settlement agreement, but placed the case on its
administrative docket with the intention of leaving it there
until the payments to Smith were satisfied. There is no
indication that a final judgment has been entered in the
underlying cases.
On December 19, 2016, Przybysz, Byker, and GAM sued Smith
in the federal district court asserting various claims based
on Smith's alleged breach of the settlement agreement. On
December 28, 2016, Smith and B2K Inc. filed an amended
complaint in the circuit court asserting additional claims
based on the defendants' alleged breach of the settlement
agreement. Smith and B2K Inc. also filed a motion requesting
that the circuit court find the defendants in contempt for
filing the action in the federal district court and assessing
sanctions against them. Lastly, Smith and B2K Inc. requested
is not necessary for purposes of resolving the petitions that
are the subject of this opinion.
4
1160381, 1160383
that the circuit court enter a consent judgment in their favor
in the amount of $750,000.
On January 30, 2017, following a hearing, the circuit
court entered an order denying Smith and B2K Inc.'s motion to
find the defendants in contempt. However, the circuit court
ordered Przybysz, Byker, and GAM to dismiss their action in
the federal district court:
"4. The court continues to retain jurisdiction
of this matter and of the execution of the
settlement per the agreement of the parties.
"5. The defendants are ORDERED and DIRECTED to
promptly dismiss any and all federal lawsuits filed
... pertaining to the settlement of this case or
purporting to seek enforcement of the settlement of
this case or relief from the terms of the
settlement."
(Capitalization in original.)
The defendants then filed their
petitions with this Court seeking mandamus relief.
Standard of Review
"A writ of mandamus will be granted 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
5
1160381, 1160383
invoked
jurisdiction
of
the
court.'"
"'Ex parte Ocwen Federal Bank, FSB, 872 So.
2d 810, 813 (Ala. 2003) (quoting Ex parte
Alfab, Inc., 586 So. 2d 889, 891 (Ala.
1991)). Mandamus will lie to direct a trial
court to vacate a void judgment or order.
Ex parte Chamblee, 899 So. 2d 244, 249
(Ala. 2004).'
"Ex parte Sealy, L.L.C., 904 So. 2d 1230, 1232 (Ala.
2004)."
Ex parte Courtyard Citiflats, LLC, 191 So. 3d 787, 789-90
(Ala. 2015).
Discussion
The defendants ask this Court to issue writs of mandamus
ordering the circuit court to vacate the portion of its
January 30, 2017, order requiring Przybysz, Byker, and GAM to
dismiss their federal lawsuit against Smith. Relying on
Donovan v. City of Dallas, 377 U.S. 408 (1964), the defendants
argue that the circuit court lacked the authority to order
Przybysz, Byker, and GAM to dismiss their federal lawsuit
against Smith. We agree and issue the writs.
In Donovan, a group of property owners near a municipal
airport filed a class action in a Texas trial court against
the municipality to restrain it from building a runway to
6
1160381, 1160383
service the municipal airport and from funding the project
through the issuance of bonds. The trial court entered a
summary judgment in favor of the municipality, and the summary
judgment was affirmed on appeal. Later, a group of citizens
of the municipality, including several members of the class
who filed the initial lawsuit in the Texas state court, filed
a class action in the United States District Court for the
Northern District of Texas against the municipality, among
others, seeking similar relief. The municipality filed an
answer to the class action in the federal court, but also
"applied to the Texas Court of Civil Appeals for a writ of
prohibition to bar all the plaintiffs in the case in the
United States District Court from prosecuting their case
there." 377 U.S. at 409. Initially, the Texas Court of Civil
Appeals
denied
the
municipality's application.
However,
after
being reversed by the Supreme Court of Texas, the Texas Court
of Civil Appeals
"issued a writ prohibiting all the plaintiffs in the
United States District Court case from any further
prosecution
of
that
case
and
enjoined
them
'individually and as a class ... from filing or
instituting ... any further litigation, law suits or
actions in any court, the purpose of which is to
contest the validity of the airport revenue bonds
7
1160381, 1160383
... or from in any manner interfering with the
proposed bonds ....'"
377 U.S. at 410. Subsequently, the United States District
Court for the Northern District of Texas dismissed the class
action, and the class-action plaintiffs appealed.
After the class-action plaintiffs appealed, the Texas
Court of Civil Appeals determined that several of the class-
action plaintiffs had violated the court's prohibition and
sanctioned the class-action plaintiffs. Although the United
States Supreme Court denied certiorari review of the United
States District Court for the Northern District of Texas's
dismissal of the class action, the United States Supreme Court
granted certiorari review "to
review the State Supreme Court's
judgment directing the Civil Court of Appeals to enjoin
petitioners from prosecuting their action in the federal
courts." Donovan, 377 U.S. at 411. In analyzing this issue,
the United States Supreme Court stated:
"Early in the history of our country a general
rule was established that state and federal courts
would not interfere with or try to restrain each
other's
proceedings.
That
rule
has
continued
substantially unchanged to this time. An exception
has been made in cases where a court has custody of
property, that is, proceedings in rem or quasi in
rem. In such cases this Court has said that the
state or federal court having custody of such
8
1160381, 1160383
property has exclusive jurisdiction to proceed.
Princess Lida v. Thompson, 305 U.S. 456, 465—468
[(1939)]. In Princess Lida this Court said 'where
the judgment sought is strictly in personam, both
the state court and the federal court, having
concurrent jurisdiction, may proceed with the
litigation at least until judgment is obtained in
one of them which may be set up as res judicata in
the other.' Id., 305 U.S. at 466. See also Kline v.
Burke Construction Co., 260 U.S. 226 [(1922)]. It
may be that a full hearing in an appropriate court
would justify a finding that the state-court
judgment in favor of [the municipality] in the first
suit barred the issues raised in the second suit, a
question as to which we express no opinion. But
plaintiffs in the second suit chose to file that
case in the federal court. They had a right to do
this, a right which is theirs by reason of
congressional
enactments
passed
pursuant
to
congressional policy. And whether or not a plea of
res judicata in the second suit would be good is a
question for the federal court to decide. While
Congress has seen fit to authorize courts of the
United States to restrain state-court proceedings in
some special circumstances, it has in no way relaxed
the old and well-established judicially declared
rule that state courts are completely without power
to restrain federal-court proceedings in in personam
actions like the one here. And it does not matter
that the prohibition here was addressed to the
parties rather than to the federal court itself. For
the heart of the rule as declared by this Court is
that:
"'... where the jurisdiction of a court,
and the right of a plaintiff to prosecute
his suit in it, have once attached, that
right cannot be arrested or taken away by
proceedings in another court. ... The fact,
therefore, that an injunction issues only
to the parties before the court, and not to
the
court,
is
no
evasion
of
the
9
1160381, 1160383
difficulties that are the necessary result
of an attempt to exercise that power over
a party ... who is a litigant in another
and independent forum.'12
"____________________
"12Peck v. Jenness, 7 How. 612, 625 [(1849)].
See also Central National Bank v. Stevens, 169 U.S.
432 [(1898)]; cf. Baltimore & O.R. Co. v. Kepner,
314 U.S. 44, 54, n. 23 ([1941)]."
Donovan, 377 U.S. at 412-13 (emphasis added; some footnotes
omitted).4 See also General Atomic Co. v. Felter, 434 U.S.
12, 17 (1977)("It is ... clear from Donovan [v. Dallas, 377
U.S. 408 (1964),] that the rights conferred by Congress to
bring in personam actions in federal courts are not subject to
abridgment by state-court injunctions, regardless of whether
the federal litigation is pending or prospective."). The
United States Supreme Court concluded that "[t]he Texas courts
were without power to take away this federal right by contempt
4This well established principle from Donovan has been
adopted in Alabama. See Moody v. State ex rel. Payne, 295
Ala. 299, 307, 329 So. 2d 73, 79 (1976)(recognizing "the
proposition stated in Donovan v. City of Dallas, 377 U.S 408,
84 S. Ct. 1579, 12 L. Ed. 2d 409 (1964), that 'state courts
are completely without power to restrain federal-court
proceedings in in personam actions'" and noting that this
principle was previously "cited and applied by this [C]ourt in
Johnson v. Brown-Service Ins. Co., 293 Ala. 549, 307 So. 2d
518 (1974)").
10
1160381, 1160383
proceedings or otherwise." Donovan, 377 U.S. at 413-14
(emphasis added).
The defendants argue that, "because this is an in
personam breach of contract action, as opposed to an in rem
proceeding, [the circuit court] is without authority to
enjoin
the federal action or order the [d]efendants to dismiss the
federal action." In their response, Smith and B2K Inc.5
recognize the application of the above-discussed principles
from Donovan. However, Smith and B2K Inc. appear to argue
that the circuit court has the authority to decide if a
federal district court would have jurisdiction over a pending
suit in the federal district court. Smith and B2K Inc.
conclude that, if the circuit court determines that a federal
district court does not have jurisdiction over the case, then
the circuit court may enjoin the action pending in the federal
district court.
In support of their argument, Smith and B2K Inc. cite
some cases for the unrelated proposition that "state courts
have the power and duty to construe questions of federal law."
5B2K Inc. is named as a respondent in both cases even
though it was not a party in the action in the federal
district court.
11
1160381, 1160383
However, none of those authorities stand for the proposition
asserted by Smith and B2K Inc. that a state court may
determine whether a federal court has jurisdiction over a case
filed in that federal court. Smith and B2K Inc.'s argument is
not supported by any relevant authority; thus, we need not
consider it further. See Jimmy Day Plumbing & Heating, Inc.
v. Smith, 964 So. 2d 1, 9 (Ala. 2007)("Rule 28(a)(10), Ala. R.
App. P., requires that arguments in an appellant's brief
contain 'citations to the cases, statutes, other authorities,
and parts of the record relied on.' Further, 'it is well
settled that a failure to comply with the requirements of Rule
28(a)(10) requiring citation of authority in support of the
arguments presented provides this Court with a basis for
disregarding those arguments.' State Farm Mut. Auto. Ins. Co.
v. Motley, 909 So. 2d 806, 822 (Ala. 2005)(citing Ex parte
Showers, 812 So. 2d 277, 281 (Ala. 2001)). This is so, because
'"it is not the function of this Court to do a party's legal
research or to make and address legal arguments for a party
based on undelineated general propositions not supported by
sufficient authority or argument."' Butler v. Town of Argo,
12
1160381, 1160383
871 So. 2d 1, 20 (Ala. 2003)(quoting Dykes v. Lane Trucking,
Inc., 652 So. 2d 248, 251 (Ala. 1994)).").
We agree with the defendants. Donovan makes clear that
the circuit court does not have the authority to order
Przybysz, Byker, and GAM to dismiss their federal action
against Smith; the defendants have demonstrated a clear legal
right to the relief they seek.
Conclusion
We grant the defendants' petitions and direct the circuit
court to vacate that portion of its order requiring Pryzbysz,
Byker, and GAM to dismiss their federal action against Smith.
1160381 -- PETITION GRANTED; WRIT ISSUED.
1160383 -- PETITION GRANTED; WRIT ISSUED.
Stuart, C.J., and Bolin, Shaw, Main, Wise, Bryan, and
Sellers, JJ., concur.
Murdock, J., concurs in the result.
13 | September 1, 2017 |
e5866b00-41b0-4efc-9812-14b633740f8d | Nation et al. v. Lydmar Revocable Trust | N/A | 1160660 | Alabama | Alabama Supreme Court | Rel: 09/22/2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
SPECIAL TERM, 2017
____________________
1160660
____________________
Jimmy E. Nation et al.
v.
Lydmar Revocable Trust
Appeal from Jefferson Circuit Court
(CV-14-905312)
PARKER, Justice.
Jimmy E. Nation, Oliver D. McCollum, James P. Pickle,
James W. Nation, Micah J. Nation, and Benjamin J. Chemeel II
(hereinafter collectively referred to as "the defendants")
appeal the Jefferson Circuit Court's denial of their motion to
1160660
compel
arbitration of
a
breach-of-contract claim
filed
against
them by the Lydmar Revocable Trust ("Lydmar").
Facts and Procedural History
Lydmar owned a 75% membership interest in Aldwych, LLC.
On March 27, 2008, Lydmar and the defendants entered into an
agreement ("the agreement") pursuant to which Lydmar agreed to
sell its membership interest in Aldwych, LLC, to the
defendants for a purchase price of $1,550,000. The defendants
paid Lydmar $900,000 at the time the agreement was executed
and simultaneously executed two promissory notes for the
balance of the purchase price.
The agreement contains a section entitled "Arbitration,"
which states:
"16.1 This Agreement provides for binding
arbitration, which is the final, exclusive and
required forum for the resolution of all disputes
that may occur between the parties ... that are
based on a 'legal claim.' If the dispute cannot be
resolved and the matter is based upon a legal claim,
the parties ... may initiate the arbitration process
at any time, even if suit has already been filed. A
dispute is based upon a 'legal claim' and is subject
to this agreement if it arises or involves a claim
under
any
federal,
state
or
local
statute,
regulation, or common law doctrine. ...
"16.2 The rules and procedures to be used by the
parties are based on the rules of the American
Arbitration Association ('AAA'). The parties hereto
2
1160660
reserve the right to mutually agree to modify or
expand these rules and procedures.
"16.3 The arbitrator shall follow the rules of
law of the State of Alabama, any applicable Federal
law, any applicable statute of limitations, and any
rules stated in the Agreement. The arbitrator shall
have the authority to grant any remedy or relief
that the arbitrator deems just and equitable and
which is consistent with applicable law.
"16.4 The expenses of witnesses or experts for
either side shall be paid by the party requiring the
presence of such witnesses. Each side shall pay its
own legal fees and expenses.
"16.5 To the fullest extent available under the
law, the parties ... hereby waive their right to a
trial before a jury for a legal claim, even if a
court holds the other provisions of this Agreement
unenforceable."
Additionally, the promissory notes contain nearly identical
arbitration provisions to the one in the agreement.
On December 31, 2014, Lydmar sued the defendants
asserting that the defendants had breached the agreement and
the accompanying promissory notes. Specifically, Lydmar
alleged that the defendants had breached their promises to
repay the notes by failing to make the required payments. On
March 5, 2015, the defendants filed an answer to Lydmar's
complaint and
asserted
counterclaims
alleging
fraud,
breach
of
3
1160660
contract and/or failure of consideration, fraudulent transfer
of assets, and constructive trust.
At the request of the parties, the circuit court delayed
setting the matter for a bench trial until they had an
opportunity to resolve the case without a trial. The parties'
attempts failed. Accordingly, on May 31, 2016, the defendants
filed a motion to compel arbitration of Lydmar's breach-of-
contract claim. Lydmar did not file a response to the
defendants' motion to compel arbitration.
On July 7, 2016, the circuit court granted the
defendants' motion to compel arbitration. The
circuit court's
order states, in pertinent part: "The cou[rt] finds a valid
arbitration agreement governs the promissory note issues of
[Lydmar's] claims and allegations.[1] Further, the written
agreement involves interstate commerce and is within the
provisions of the Federal Arbitration Act." The circuit court
further ordered the clerk of the circuit court to place the
case on the circuit court's administrative docket "pending
further orders of this court."
1Although
the
circuit
court's
order
states
that
Lydmar
had
asserted claims, it appears that Lydmar asserted only one
breach-of-contract claim against the defendants.
4
1160660
However, after the circuit court ordered the arbitration
of Lydmar's claim, neither the defendants nor
Lydmar initiated
the arbitration process. Accordingly, on February 6, 2017,
the defendants filed with the circuit court a motion to
dismiss Lydmar's breach-of-contract claim; the motion was
based on Lydmar's failure to initiate the arbitration
proceedings. The defendants argued that it was Lydmar's
responsibility to initiate the arbitration process and that
Lydmar had failed to take any action toward fulfilling its
responsibility to do so. Accordingly, citing Rule 41(b), Ala.
R. Civ. P., the defendants requested that Lydmar's claim be
dismissed without prejudice. On March 2, 2017, Lydmar filed
a response to the defendants' motion to dismiss. Lydmar did
not contest the existence of the arbitration provisions
requiring arbitration of its claim, but argued only that,
under the Commercial Arbitration Rules of the American
Arbitration Association ("AAA"), the defendants, and not
Lydmar, had the responsibility to initiate the arbitration
process. Because the defendants failed to do so in a
reasonable time, Lydmar argued, the case was due to be
returned to the active docket of the circuit court so that
5
1160660
Lydmar could litigate its claim against the defendants in that
court.
On March 15, 2017, the circuit court denied the
defendants' motion to dismiss. In the same order, the circuit
court ordered the clerk of the circuit court to return the
case to the active docket. Although not expressly stated in
the order, it appears that the circuit court, by returning the
case to the active docket, effectively reversed its own order
entered on July 7, 2016, granting the defendants' motion to
compel arbitration. On March 22, 2017, the circuit court
entered a scheduling order setting the case for a bench trial
to occur during the week of June 5, 2017. The defendants
appealed.
Standard of Review
Our standard of review of a ruling on a motion to compel
arbitration is well settled:
"'"This Court reviews de novo the denial of a
motion to compel arbitration. Parkway Dodge, Inc. v.
Yarbrough, 779 So. 2d 1205 (Ala. 2000). A motion to
compel arbitration is analogous to a motion for a
summary judgment. TranSouth Fin. Corp. v. Bell, 739
So. 2d 1110, 1114 (Ala. 1999). The party seeking to
compel arbitration has the burden of proving the
existence of a contract calling for arbitration and
proving that the contract evidences a transaction
affecting interstate commerce. Id. '[A]fter a motion
6
1160660
to compel arbitration has been made and supported,
the burden is on the non-movant to present evidence
that the supposed arbitration agreement is not valid
or does not apply to the dispute in question.' Jim
Burke Automotive, Inc. v. Beavers, 674 So. 2d 1260,
1265 n. 1 (Ala. 1995) (opinion on application for
rehearing)."'"
Chris Myers Pontiac-GMC, Inc. v. Perot, 991 So. 2d 1281, 1282-
83 (Ala. 2008) (quoting Elizabeth Homes, L.L.C. v. Gantt, 882
So. 2d 313, 315 (Ala. 2003), quoting in turn Fleetwood
Enters., Inc. v. Bruno, 784 So. 2d 277, 280 (Ala. 2000)).
Discussion
The defendants first argue on appeal that they met their
initial "burden of proving the existence of a contract calling
for arbitration and proving that the contract evidences a
transaction affecting interstate commerce." Perot, 991
So.
2d
at 1283. In support of their motion to compel arbitration,
the defendants submitted to the circuit court copies of the
agreement and the promissory notes, each of which contains an
arbitration provision. Based on the agreement and promissory
notes, the defendants demonstrated that their purchase of
Lydmar's membership interest in Aldwych is a transaction
affecting interstate commerce. This evidence of
the
existence
of "a contract calling for arbitration and ... that the
7
1160660
contract
evidences
a
transaction
affecting
interstate
commerce" was not refuted by Lydmar. Id. In fact, Lydmar did
not even file a response to the defendants' motion to compel
arbitration and offers no argument on appeal concerning this
issue. Because the defendants had met their burden and Lydmar
made no response, the circuit court, on July 7, 2016, granted
the defendants' motion to compel arbitration.
Nevertheless, on March 15, 2017, the circuit court
entered an order returning the case to the court's active
docket. On March 22, 2017, the circuit court then entered a
scheduling order setting the case for a bench trial during the
week of June 5, 2017. We interpret those orders as
effectively reversing its decision on the same motion to
compel arbitration filed by the defendants that the circuit
court had granted on July 7, 2016. The circuit court did not
provide any reasoning explaining its reversal, and we can find
no definite explanation in the record before us. However,
because Lydmar did not produce any evidence indicating that
the arbitration provisions in the agreement and promissory
notes were invalid or that they did not apply to the dispute
in question, we presume that the circuit court found
8
1160660
convincing Lydmar's argument, made in response to the
defendants' motion to dismiss, that the obligation to
initiate
the arbitration process was on the defendants and, by failing
to initiate the process in a reasonable time, the defendants
had waived their right to arbitration. This is the very
argument Lydmar makes to this Court on appeal. The defendants
argue that nothing in the arbitration provisions or the
Commercial Arbitration Rules of the AAA place on the
defendants an obligation to initiate the arbitration process
and, thus, that they did not waive their right to arbitration
by failing to initiate the arbitration process. We agree with
the defendants.
In order to determine if the circuit court erred in
reversing its order granting the motion to compel arbitration
and returning the case to the active docket, we must determine
whether the arbitration provisions in the agreement and the
notes, which incorporate the Commercial Arbitration Rules of
the AAA, placed an obligation on the defendants to initiate
the arbitration process. In answering this question, we must,
of course, look to the terms of the arbitration provisions.
In Perot, this Court stated:
9
1160660
"This Court has held that a trial court, in
granting a motion to compel arbitration, cannot
alter or ignore the terms of the arbitration
agreement that provides the basis for compelling
arbitration. See, e.g., Southern Energy Homes Retail
Corp. v. McCool, 814 So. 2d 845, 849 (Ala. 2001)
(granting the petition for the writ of mandamus
where the trial court 'failed to compel arbitration
in a manner consistent with the terms of [the]
arbitration provision'); and Ex parte Cappaert
Manufactured Homes, 822 So. 2d 385, 387 (Ala. 2001)
('[Section] 5 [of the Federal Arbitration Act]
mandates
that
the
method
set
forth
in
the
arbitration
agreement
be
followed.').
...
'"Agreements to arbitrate are essentially creatures
of contract," and ordinary contract rules govern the
interpretation of arbitration provisions.' Orkin
Exterminating Co. v. Larkin, 857 So. 2d 97, 103
(Ala. 2003) (quoting Blount Int'l, Ltd. v. James
River–Pennington, Inc., 618 So. 2d 1344, 1346 (Ala.
1993)). 'When interpreting a contract, a court
should give the terms of the contract their clear
and plain meaning and should presume that the
parties intended to do what the terms of the
agreement clearly state.' Brewbaker Motors, Inc. v.
Belser, 776 So. 2d 110, 112 (Ala. 2000)."
991 So. 2d at 1283-84. The arbitration provisions at issue in
the present case all essentially state, in pertinent part:
"This Agreement provides for binding arbitration,
which is the final, exclusive and required forum for
the resolution of all disputes that may occur
between the parties ... that are based on a 'legal
claim.' If the dispute cannot be resolved and the
matter is based upon a legal claim, the parties ...
may initiate the arbitration process at any time,
even if suit has already been filed. A dispute is
based upon a 'legal claim' and is subject to this
agreement if it arises or involves a claim under any
10
1160660
federal, state or local statute, regulation, or
common law doctrine. ..."
Nothing in the arbitration provisions requires the defendants
to initiate the arbitration process. The arbitration
provisions simply state that "the parties ... may initiate the
arbitration process at any time." (Emphasis added.) No
language requires either party to initiate the arbitration
process. Therefore, under the plain language of the
arbitration
provisions,
we
cannot
conclude
that
the
arbitration provisions require the defendants to initiate the
arbitration process.
The defendants also argue that nothing in the Commercial
Arbitration Rules of the AAA, which are incorporated into the
arbitration provisions, requires them to initiate the
arbitration process. This Court considered a similar
situation in Perot, supra. In Perot, Larry C. Perot and Bobbi
M. Perot purchased a vehicle from Chris Myers Pontiac-GMC,
Inc., d/b/a Chris Myers Automotive. At the time of the
purchase, the Perots signed an arbitration agreement. After
purchasing the vehicle, the Perots sued Chris Meyers
Automotive,
alleging
various
claims
related
to
a
water-leakage
problem with the purchased vehicle. Chris Meyers Automotive
11
1160660
filed a motion to compel arbitration of the Perots' claims,
which the circuit court granted. However, neither party
initiated the arbitration process. Accordingly, the Perots
filed a motion with the circuit court requesting that the
circuit court compel Chris Meyers Automotive to initiate the
arbitration process or, in the alternative, to reconsider its
order compelling arbitration and allow them to litigate their
claims against Chris Myers Automotive in that court. The
circuit court entered an order stating that it was ex mero
motu denying Chris Meyers Automotive's motion to compel
arbitration. Chris Meyers Automotive appealed.
On appeal, this Court explained that the issue to be
decided was whether Chris Meyers Automotive had
the
obligation
to initiate the arbitration process and, if so, whether Chris
Meyers Automotive had waived its right to arbitration by
failing to initiate the process. This Court addressed the
issue on two alternative grounds. First, this Court
determined that the language of the arbitration agreement in
that case, unlike the language in the arbitration provisions
at issue in this case, obligated the Perots, as the
plaintiffs, to initiate the arbitration process.
12
1160660
Second, in addition to the plain language of the
arbitration agreement, this Court also determined that the
Commercial Arbitration Rules of the AAA, which had been
incorporated into the arbitration agreement at issue in
Perot,
obligated the plaintiffs to initiate the arbitration process.
The applicable rule was Rule R-4 of the Commercial Arbitration
Rules of the AAA, which is also the applicable rule in this
case and which stated, at that time:
"'"R–4.
Initiation
under
an
Arbitration
Provision in a Contract
"'"(a)
Arbitration
under
an
arbitration
provision in a contract shall be initiated in the
following manner:
"'"i.
The
initiating
party
(the
'claimant') shall, within the time period,
if any, specified in the contract(s), give
to the other party (the 'respondent')
written
notice
of
its
intention
to
arbitrate (the 'demand'), which demand
shall contain a statement setting forth the
nature of the dispute, the names and
addresses of all other parties, the amount
involved, if any, the remedy sought, and
the hearing locale requested.
"'"ii. The claimant shall file at any
office of the AAA two copies of the demand
and
two
copies
of
the
arbitration
provisions of the contract, together with
the appropriate filing fee as provided in
the schedule included with these rules.
13
1160660
"'"iii. The AAA shall confirm notice
of such filing to the parties."'"
Perot, 991 So. 2d at 1284-85 (quoting Northcom, Ltd. v. James,
848 So. 2d 242, 246 (Ala. 2002), quoting in turn the
Commercial Arbitration Rules of the AAA). This Court
concluded that, "[u]nder this rule, it is clear that the
'claimant,' that is, the party asserting a claim, has the
burden of initiating arbitration." 991 So. 2d at 1285.
Accordingly, this Court determined in Perot that, under the
Commercial Arbitration Rules of the AAA, the obligation to
initiate
the arbitration
proceedings
rested
with
the
plaintiffs. See also Northcom, Ltd. v. James, 848 So. 2d at
246 (relying upon Ex parte Dan Tucker Auto Sales, Inc., 718
So. 2d 33 (Ala. 1998), Huntley v. Regions Bank, 807 So. 2d
512 (Ala. 2001), and Universal Underwriters Life Ins. Co. v.
Dutton, 736 So. 2d 564 (Ala. 1999), in holding that, under a
previous, but similar, version of Rule R-4, "the party
asserting a legal claim, i.e., the plaintiff, must initiate
arbitration proceedings").
As in Perot, the arbitration provisions here also
incorporate the entirety of the Commercial Arbitration Rules
of the AAA; the parties agree that the Commercial Arbitration
14
1160660
Rules of the AAA apply. The parties further agree that Rule
R-4 is the applicable rule that answers the question this
Court has been asked to decide. This is the same rule this
Court interpreted in Perot to mean that the plaintiff has the
burden to initiate the arbitration process once the circuit
court has entered an order compelling arbitration. However,
as Lydmar notes, Rule R-4 has been amended since Perot,
Northcom, Ex parte Dan Tucker Auto Sales, Huntley, and Dutton
were decided. Rule R-4 now states:
"R-4. Filing Requirements
"(a) Arbitration under an arbitration provision
in a contract shall be initiated by the initiating
party ('claimant') filing with the AAA a Demand for
Arbitration, the administrative filing fee, and a
copy of the applicable arbitration agreement from
the
parties'
contract
which
provides
for
arbitration.
"(b) Arbitration pursuant to
a
court order shall
be initiated by the initiating party filing with the
AAA a Demand for Arbitration, the administrative
filing fee, and a copy of any applicable arbitration
agreement from the parties' contract which provides
for arbitration.
"i. The filing party shall include a
copy of the court order.
"ii. The filing fee must be paid
before a matter is considered properly
filed. If the court order directs that a
specific party is responsible for the
15
1160660
filing fee, it is the responsibility of the
filing party to either make such payment to
the AAA and seek reimbursement as directed
in the court order or to make other such
arrangements so that the filing fee is
submitted to the AAA with the Demand.
"iii. The party filing the Demand with
the AAA is the claimant and the opposing
party is the respondent regardless of which
party initiated the court action. Parties
may request that the arbitrator alter the
order of proceedings if necessary pursuant
to R-32.
"(c) It is the responsibility of the filing
party to ensure that any conditions precedent to the
filing of a case are met prior to filing for an
arbitration, as well as any time requirements
associated with the filing. Any dispute regarding
whether a condition precedent has been met may be
raised to the arbitrator for determination.
"....
"(e) Information to be included with any
arbitration filing includes:
"i. the name of each party;
"ii. the address for each party,
including telephone and fax numbers and
e-mail addresses;
"iii.
if
applicable,
the
names,
addresses, telephone and fax numbers, and
e-mail
addresses
of
any
known
representative for each party;
"iv. a statement setting forth the
nature of the claim including the relief
sought and the amount involved; and
16
1160660
"v. the locale requested if the
arbitration agreement does not specify
one."
Lydmar argues that Rule R-4 "makes clear that if a
defendant in a lawsuit invokes the arbitration clause of a
contract, then that defendant is the party who must file a
demand with the AAA to initiate the arbitration, even though
it was the plaintiff who filed suit." Lydmar's brief, at p.
8. Lydmar focuses this Court's attention on the language in
Rule R-4 stating: "Arbitration pursuant to a court order shall
be initiated by the initiating party filing with the AAA a
Demand for Arbitration" and "[t]he party filing the Demand
with the AAA is the claimant and the opposing party is the
respondent regardless of which party initiated the court
action." Lydmar does not, however, offer any analysis of how
the language in those provisions places the burden to initiate
the arbitration process on a defendant that has had a motion
to compel arbitration granted. We do not find Lydmar's
argument convincing.
In fact, we do not read anything in Rule R-4, or any
other aspect of the Commercial Arbitration Rules of the AAA,
placing the burden to initiate the arbitration process on a
17
1160660
defendant that has successfully petitioned a circuit court to
compel arbitration of the claims asserted against it. Rather,
Rule R-4 makes clear that either party may demand arbitration
by filing with the AAA a written demand for arbitration.
Accordingly, as in Perot, we conclude that nothing in the
Commercial Arbitration Rules of the AAA obligates the
defendants
to
initiate
the
arbitration
process.2
2Although it is unnecessary for us in this case to address
the issue whether Lydmar, as the plaintiff, has an obligation
to initiate the arbitration process, we note that the amended
version of the Commercial Arbitration Rules of the AAA does
not appear to be substantially different in spirit from the
pre-amended version of the rules as to that issue, i.e., who
may initiate arbitration proceedings. Concerning the pre-
amended version of Rule R-4, this Court stated in Northcom,
Ltd v. James, 848 So. 2d at 246-47:
"Our caselaw clearly dictates that under the
Commercial Arbitration Rules, the party asserting a
legal claim, i.e., the plaintiff, must initiate
arbitration proceedings.
"'[T]he
Commercial
Arbitration
Rules
state[]
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
18
1160660
"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 [the defendant
below] 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
[the plaintiff below] 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
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.'
"Ex parte Dan Tucker Auto Sales, Inc., 718 So. 2d
[33,] 36 [(Ala. 1998)] (some alterations original;
some alterations added). See also Huntley v. Regions
Bank, 807 So. 2d 512 (Ala. 2001)(rejecting Regions
Bank's argument that Huntley, the defendant, failed
to properly invoke the arbitration agreement and
holding that Regions Bank, as the plaintiff, bore
the burden of properly invoking the arbitration
agreement); and Universal Underwriters Life Ins. Co.
19
1160660
The defendants may certainly do so if they so choose, but we
cannot say that they are obligated to do so under the
arbitration provisions at issue in this case or under the
Commercial Arbitration Rules of the AAA.3
v. Dutton, 736 So. 2d 564 (Ala. 1999)(holding that
the plaintiffs were the 'claimants' under the AAA's
Commercial Arbitration Rules and that the claimants,
as the initiating parties, were responsible for
advancing the filing fee)."
See also In re Bruce Terminix Co., 988 S.W.2d 702, 706 (Tex.
1998)("It would be anomalous to require the party against whom
relief is sought to present its opponent's case and pay a
filing fee whose amount is based on the size of its opponent's
claim. ... By agreeing to the AAA rules, [the parties to the
arbitration agreement] placed the burden of initiating
arbitration on the party seeking relief."); 1 Domke on
Commercial Arbitration § 18:1 (3d ed. 2008) ("An initial
question ... is whether the arbitration proceeding must be
initiated by the party making the claim or by the party
desiring the arbitration. Generally, it is the party seeking
substantive
relief
which
must
initiate
the
arbitration,
rather
than the respondent."); and 3 Commercial Arbitration § 44:2
("Where a contract does place the initial burden to commence
arbitration [with the arbitrator] on either party, that duty
to demand arbitration [with the arbitrator] rests with the
party seeking relief."). This logic also appears to apply to
the current version of the Commercial Arbitration Rules of the
AAA.
3In his concurrence in the result in Perot, Justice
Murdock noted that, although a party in the position of the
defendants "might be thought of as less likely to initiate an
arbitration proceeding, its doing so would be comparable to a
potential defendant filing a declaratory-judgment action in a
court of law to resolve a dispute between it and a potential
plaintiff." Perot, 991 So. 2d at 1286 n. 3 (Murdock, J.,
concurring in the result).
20
1160660
Conclusion
The defendants submitted evidence showing that Lydmar
signed a contract agreeing that all disputes between them
related to the defendants' purchase of Lydmar's membership
interest in Aldwych would be settled in arbitration and that
the contract evidenced a transaction affecting interstate
commerce. Lydmar did not refute that evidence, nor did it
establish that the defendants waived their right to rely on
those arbitration provisions. Therefore, the circuit court
erred by returning the case to its active docket and
effectively
denying
the
defendants'
motion
to
compel
arbitration; its March 15, 2017, order so doing is hereby
reversed and the cause remanded for further proceedings
consistent with this opinion.
REVERSED AND REMANDED.
Stuart, C.J., and Murdock, Main, Wise, and Bryan, JJ.,
concur.
Bolin, Shaw, and Sellers, JJ., concur in the result.
21 | September 22, 2017 |
ac883395-d29f-4304-84c6-74a148dabe40 | Ex parte Locklear Chrysler Jeep Dodge, LLC, and Locklear Automotive Group, Inc. | N/A | 1160373 | Alabama | Alabama Supreme Court | Rel:09/29/2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
SPECIAL TERM, 2017
____________________
1160372
____________________
Ex parte Locklear Chrysler Jeep Dodge, LLC, and Locklear
Automotive Group, Inc.
PETITION FOR WRIT OF MANDAMUS
(In re: Rhonda Cook
v.
Locklear Chrysler Jeep Dodge, LLC, and Locklear Automotive,
Inc.)
(Bibb Circuit Court, CV-16-900049)
____________________
1160373
____________________
Ex parte Locklear Chrysler Jeep Dodge, LLC, and Locklear
Automotive Group, Inc.
PETITION FOR WRIT OF MANDAMUS
(In re: James McKinney
v.
Locklear Chrysler Jeep Dodge, LLC, and Locklear Automotive
Group, Inc.)
(Bibb Circuit Court, CV-16-900053)
____________________
1160374
____________________
Ex parte Locklear Chrysler Jeep Dodge, LLC, and Locklear
Automotive Group, Inc.
PETITION FOR WRIT OF MANDAMUS
(In re: James Daniel Parker
v.
Locklear Chrysler Jeep Dodge, LLC, and Locklear Automotive
Group, Inc.)
(Bibb Circuit Court, CV-16-900054)
BOLIN, Justice.
Locklear
Chrysler
Jeep
Dodge,
LLC,
and
Locklear
Automotive Group, Inc. (hereinafter referred to collectively
as "Locklear"), seek a writ of mandamus ordering the Bibb
2
1160372, 1160373, 1160374
Circuit Court to vacate certain discovery orders in actions
filed against Locklear by Rhonda Cook, James McKinney, and
James Daniel Parker (hereinafter referred to collectively as
"the purchasers"), who allege that they were victims of
identity theft by a Locklear employee.
Facts and Procedural History
In order to explore the possibility of financing the
purchase of an automobile from Locklear, the purchasers each
completed a credit application. The credit applications
contained personal information, including Social Security
numbers, birth dates, mother's maiden names, income, etc. In
connection with the purchase, each purchaser signed an
arbitration agreement titled "Binding Pre-Dispute Arbitration
Agreement" ("the arbitration agreement"); its operative
language is as follows:
"In
connection
with
the
undersigned's
acquisition or attempted acquisition of the below
described vehicle, by lease, rental, purchase or
otherwise, the undersigned and the dealer whose name
appears below, stipulate and agree, in connection
with the resolution of any dispute arising out of,
or relating to, resulting from or concerning any
contracts or agreements, or agreements or contracts
to be entered into by the parties, all alleged
representations, promises and covenants, issues
concerning compliance with any state or federal law
or regulation, and all relationships resulting
3
1160372, 1160373, 1160374
therefrom, as follows: That the vehicle, services,
and products (hereinafter 'products') involved in
the
acquisition
or
attempted
acquisition
are
regulated by the laws of the United States of
America; and/or, that the contract(s) and agreements
entered into by the parties concerning said products
evidence transactions and business enterprises
substantially involving and affecting interstate
commerce sufficiently to invoke the application of
the Federal Arbitration Act, 9 U.S.C. § 1, et seq.
The undersigned agree that all disputes not barred
by applicable statutes of limitations, resulting
from, arising out of, relating to or concerning the
transaction entered into or sought to be entered
into (including but not limited to: any matters
taking place either before or after the parties
entered into this agreement, including any prior
agreements or negotiations between the parties; the
terms of this agreement and all clauses herein
contained, their breadth and scope, and any term of
any agreement contemporaneously entered into by the
parties; the past, present and future condition of
any products at issue; the conformity of the
products
to
any
contract
description;
the
representations, promises, undertakings, warranties
or covenants made by the dealer, its agents,
servants, employees, successors and assigns, or
otherwise dealing with the products; any lease, sale
or rental terms or the terms of credit and/or
financing in connection therewith; or compliance
with any state or federal laws; any terms or
provisions of any insurance sought to be purchased
or purchased simultaneously herewith; any terms or
provisions of any extended service to be purchased
or purchased herewith) shall be submitted to BINDING
ARBITRATION, pursuant to the provisions of 9 U.S.C.
§ 1, et seq. and according to the Commercial Dispute
Resolution procedures and/or Consumer Protocol
(depending on the amount in controversy) of the
American Arbitration Association (the AAA) then
existing in the county where the transaction was
entered into or sought to be entered into, except as
4
1160372, 1160373, 1160374
follows: (a) In all disputes in which the matter in
controversy (including compensatory and punitive
damages, fees and costs) is more than $10,000 but
less than $75,000.00, one arbitrator shall be
selected in accordance with the AAA's Consumer
Protocol. In all disputes in which the matter in
controversy (including compensatory and punitive
damages and fees and costs) is $75,000.00 or more,
the parties to this agreement shall select an
arbitrator under the AAA's Commercial Rules and
shall select one arbitrator from a list of at least
5 suitable arbitrators supplied by the AAA in
accordance with and utilizing the AAA strike method.
(b) An arbitrator so selected shall be empowered to
enter an award of such damages, fees and costs, and
grant such other relief, as is allowed by law. The
arbitrator has no authority or jurisdiction to enter
any
award
that
is
not
in
conformance
with
controlling law. Any party to this agreement who
fails or refuses to arbitrate in accordance with the
terms of this agreement may, in addition to any
other relief awarded, be taxed by the arbitrator
with the costs, including reasonable attorney's
fees, of any other party who had to resort to
judicial or other relief in compelling arbitration.
In the event the dealer and the undersigned
customer(s) have entered into more than one
arbitration agreement concerning any of the matters
identified herein, the undersigned customers and the
dealer agree that the terms of this arbitration
agreement shall control disputes between and among
them. Any provision in this Agreement found to be in
conflict with any procedure promulgated by the AAA
which shall affect its administration of disputes
hereunder, shall be considered severed herefrom.
With respect to the process of arbitration under the
AAA commercial Rules or Consumer Protocol, the
undersigned customer(s) and the dealer expressly
recognize that the rules and protocol and the terms
of this agreement adequately protect their abilities
to fully and reasonably pursue their respective
statutory and other legal rights. If for any reason
5
1160372, 1160373, 1160374
the AAA fails or refuses to administer the
arbitration of any dispute brought by any party to
this agreement, the parties agree that all disputes
will then be submitted to binding arbitration before
the Better Business Bureau (the BBB) serving the
community where the Dealer conducts business, under
the BBB binding arbitration rules. ... This
agreement
shall
survive
any
termination,
cancellation, fulfillment, or non-fulfillment of any
other contract, covenant or agreement related to the
products acquired or sought to be acquired from the
Dealer, including, but not limited to cancellation
due to lack of acceptable financing or funding of
any retail installment contract or lease. Further
information about arbitration can be obtained
directly from the AAA or from a review of AAA's
Commercial
Dispute
Resolution
Procedures
and
Consumer
Protocol,
and/or
the
BBB's
Binding
Arbitration Rules, copies of which are available
without charge for review from the AAA and the BBB.
THE
UNDERSIGNED
HAVE
AGREED
TO
WAIVE
THE
UNDERSIGNED(S)' RIGHT TO A TRIAL BY JUDGE OR JURY IN
ALL DISPUTES OVER $10,000.00 AND THAT ARBITRATION
SHALL BE IN LIEU OF ANY CIVIL LITIGATION IN ANY
COURT AND IN LIEU OF ANY TRIAL BY JUDGE OR JURY FOR
ALL CLAIMS OVER $10,000.00. THE TERMS OF THIS
AGREEMENT AFFECT LEGAL RIGHTS. IF YOU DO NOT
UNDERSTAND ANY PROVISION OF THIS AGREEMENT OR THE
COSTS, ADVANTAGES OR DISADVANTAGES OF ARBITRATION,
SEEK INDEPENDENT ADVICE AND/OR REVIEW THE WRITTEN
CONSUMER
AND/OR
COMMERCIAL
DISPUTE
RESOLUTION
PROCEDURES AND PROTOCOLS AND/OR CONTACT THE AAA OR
BBB BEFORE SIGNING. BY SIGNING YOU ACKNOWLEDGE THAT
YOU HAVE READ, UNDERSTAND AND AGREE TO BE BOUND BY
EACH OF THE PROVISIONS, COVENANTS, STIPULATIONS AND
AGREEMENTS SET FORTH AND REFERENCED HEREINABOVE.
"DESCRIPTION
OF
PRODUCTS/SERVICES:
________________"
(Capitalization and emphasis in original.)
6
1160372, 1160373, 1160374
In the blank line following the words "DESCRIPTION OF
PRODUCTS/SERVICES" typically was printed the year and
model of
the vehicle to be purchased as well as the vehicle-
identification number of that vehicle. Below that were lines
for the date to be filled in and lines for signatures of the
customer and a dealer representative. Each of the purchasers
signed the arbitration agreement in December 2015.
In July and August 2016, each of the purchasers sued
Locklear, as well as other defendants. Each purchaser alleged
that he or she was the victim of identity theft by an employee
of Locklear's who used the personal information from the
purchaser's credit application to purchase thousands of
dollars in cellular-telephone services. They asserted claims
of negligence, wantonness, invasion of privacy, conversion,
fraud, tort of outrage, civil conspiracy, violations of
Alabama's Consumer Identity Protection Act, and breach of
fiduciary duty. Shortly after filing their lawsuits, the
purchasers
sought
general
discovery,
including
interrogatories, requests for production of documents,
requests for admissions, and notices of deposition. The
7
1160372, 1160373, 1160374
general discovery requests regarded matters related to the
purchasers' substantive claims.
In response to the three actions, Locklear filed a motion
in each action seeking an order compelling arbitration staying
the action. The trial court held a hearing on the motions,
but did not rule on them.
Subsequently, each of the purchasers filed a motion to
compel Locklear's responses to their discovery requests and to
deem admitted their requests for admissions. The trial court
granted the purchasers' motions. Locklear then filed three
petitions for mandamus review, which this Court consolidated
for the purpose of writing one opinion. While the mandamus
petitions were pending, the trial court granted Locklear's
motions to stay discovery.
Standard of Review
"Mandamus is
an
extraordinary remedy and
will be
granted 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 Alfab, Inc.,
586 So. 2d 889, 891 (Ala. 1991). This Court will
not issue the writ of mandamus where the petitioner
has '"full and adequate relief"' by appeal. State v.
Cobb, 288 Ala. 675, 678, 264 So. 2d 523, 526 (1972)
8
1160372, 1160373, 1160374
(quoting State v. Williams, 69 Ala. 311, 316
(1881)).
"Discovery matters are within the trial court's
sound discretion, and this Court will not reverse a
trial court's ruling on a discovery issue unless the
trial court has clearly exceeded its discretion.
Home Ins. Co. v. Rice, 585 So. 2d 859, 862 (Ala.
1991). Accordingly, mandamus will issue to reverse
a trial court's ruling on a discovery issue only (1)
where there is a showing that the trial court
clearly exceeded its discretion, and (2) where the
aggrieved party does not have an adequate remedy by
ordinary appeal. The petitioner has an affirmative
burden to prove the existence of each of these
conditions."
Ex parte Ocwen Fed. Bank, FSB, 872 So. 2d 810, 813 (Ala.
2003).
Discussion
Locklear argues that, although discovery may be allowed
while a motion to compel arbitration is pending, that
discovery is limited to whether the parties to the arbitration
agreement must arbitrate their claims. Locklear argues that
the trial court exceeded its discretion in allowing general
discovery regarding the merits of the purchasers' claims.
Locklear argues that permitting general discovery to proceed
in a case that may be subject to arbitration could frustrate
one of the purposes underlying arbitration, namely, the
inexpensive and expedient resolution of disputes.
9
1160372, 1160373, 1160374
Locklear cites Ex parte Kenworth of Birmingham, Inc., 789
So. 2d 227 (Ala. 2000), in support of its position. In
Kenworth, the plaintiffs sued Kenworth and its salesman,
asserting claims arising out of the purchase of a truck. They
alleged that the salesman had represented that the truck was
new, when, in fact, the truck had been used and damaged, had
been repaired, had had parts replaced, and had been repainted
to appear new. Kenworth and the salesman answered the
complaint, raising several affirmative defenses and asserting
that the plaintiffs' claims were subject to arbitration. They
moved to stay the proceedings and to compel arbitration,
attaching a copy of a "Buyer's Order" that contained an
arbitration provision. In response to the motion to compel,
the plaintiffs asserted that they did not recall an
arbitration provision in the paperwork underlying the sale of
the truck and that the signature on the paperwork was not
theirs.
On the day of the hearing on the motion to stay and to
compel arbitration, Kenworth and the salesman moved in open
court to continue the hearing and requested leave to conduct
discovery. The trial court rescheduled the hearing on the
10
1160372, 1160373, 1160374
motion to compel arbitration and ordered that discovery would
not be stayed pending the hearing, nor would discovery be
limited to the issue of the genuineness of the signature on
the buyer's order containing the arbitration provision.
Both sides in Kenworth filed notices of depositions. A
week before the scheduled depositions, Kenworth and the
salesman moved for what they called a "reconsideration" and to
stay discovery, arguing that they had made a prima facie
showing that the arbitration provision was enforceable. The
trial court denied that motion and further stated that "'there
is no "prima facie showing that the arbitration agreement is
enforceable."'" 789 So. 2d at 229. The court then reset the
hearing on the motion to compel arbitration. Kenworth and the
salesman petitioned this Court for the writ of mandamus before
the hearing could be held. They argued that the trial court
exceeded its discretion by allowing unrestricted discovery
before a resolution of the question whether the plaintiffs
must arbitrate their claims. This Court agreed, holding that,
although the trial court did not err in allowing the parties
to conduct discovery, it did err in failing to restrict that
11
1160372, 1160373, 1160374
discovery to the question whether the plaintiffs had agreed to
arbitrate their dispute with Kenworth and the salesman.
We note that, in the instant case, this Court is not
reviewing a trial court's order denying a motion to compel
arbitration; the trial court has not yet ruled on Locklear's
motion to compel. It is the trial court's general discovery
orders that are being challenged. Here, as in Kenworth, the
trial court exceeded its discretion by allowing general
discovery before the resolution of the issue whether the
purchasers must arbitrate their claims. In Ex parte Jim Burke
Automotive, Inc., 776 So. 2d 118 (Ala. 2000), this Court
explained that, although it was not error for the trial court
to allow the parties to conduct discovery prior to
arbitration, it was error not to limit the discovery to the
question whether the plaintiff agreed to arbitrate his claims
and that such limited discovery did not constitute a waiver of
the right to arbitrate. Here, the purchasers have not
requested discovery on an issue related to the arbitration
agreement; instead, they sought general discovery regarding
the merits of their claims. In granting the purchasers'
requests for general discovery before the resolution of
12
1160372, 1160373, 1160374
Locklear's arbitration motions, the trial court exceeded its
discretion. Furthermore, because it would be unfair to
require Locklear conduct merit-based discovery prior to
deciding the arbitration issue, and because Locklear could not
be afforded the relief it seeks after that discovery has been
conducted, Locklear does not have an adequate remedy by
ordinary appeal. Accordingly, we grant the petitions and
issue the writs, directing the trial court to vacate its
orders requiring Locklear to respond to the purchasers'
discovery requests, including the requests for admissions and
to sit for depositions.
1160372 -- PETITION GRANTED; WRIT ISSUED.
1160373 -- PETITION GRANTED; WRIT ISSUED.
1160374 -- PETITION GRANTED; WRIT ISSUED.
Stuart, C.J., and Parker, Murdock, Shaw, Main, Wise,
Bryan, and Sellers, JJ., concur.
13 | September 29, 2017 |
2fb36f08-02c8-4cc2-9283-7fba250ac0b9 | Ex parte United Services Automobile Association. | N/A | 1160517 | Alabama | Alabama Supreme Court | Rel: 09/01/2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
SPECIAL TERM, 2017
____________________
1160504
____________________
Ex parte Midsouth Paving, Inc.
PETITION FOR WRIT OF MANDAMUS
(In re: Barbara M. Hodge, as administratrix of the Estate of
Katie-Elizabeth Hope Vann, and Sue Davis, as parent and next
friend of Valorie Eicher, a minor, Tristan Eicher, a minor,
and Cody Ballinger, a minor
v.
Rennie D. Jackson et al.)
____________________
1160505
____________________
Ex parte Rennie D. Jackson
PETITION FOR WRIT OF MANDAMUS
(In re: Barbara M. Hodge, as administratrix of the Estate of
Katie-Elizabeth Hope Vann, and Sue Davis, as parent and next
friend of Valorie Eicher, a minor, Tristan Eicher, a minor,
and Cody Ballinger, a minor
v.
Rennie D. Jackson et al.)
____________________
1160517
____________________
Ex parte United Services Automobile Association
PETITION FOR WRIT OF MANDAMUS
(In re: Barbara M. Hodge, as administratrix of the Estate of
Katie-Elizabeth Hope Vann, and Sue Davis, as parent and next
friend of Valorie Eicher, a minor, Tristan Eicher, a minor,
and Cody Ballinger, a minor
v.
Rennie D. Jackson et al.)
____________________
1160563
____________________
Ex parte Schaeffler Group USA, Inc., and Gelco Corporation
PETITION FOR WRIT OF MANDAMUS
(In re: Barbara M. Hodge, as administratrix of the Estate of
Katie-Elizabeth Hope Vann, and Sue Davis, as parent and next
friend of Valorie Eicher, a minor, Tristan Eicher, a minor,
and Cody Ballinger, a minor
2
v.
Rennie D. Jackson et al.)
(Hale Circuit Court, CV-16-900034)
PARKER, Justice.
Midsouth Paving, Inc. ("Midsouth"), Rennie D. Jackson,
United
Services
Automobile
Association
("USAA"),
and
Schaeffler
Group
USA,
Inc.
("Schaeffler"),
and
Gelco
Corporation
("Gelco")
(hereinafter
collectively
referred
to
as
"the defendants") separately petition this Court for writs of
mandamus directing the Hale Circuit Court to vacate its order
denying the defendants' motions for a change of venue and to
enter an order transferring the action filed against the
defendants by Barbara M. Hodge, as the administratrix of the
estate of Katie-Elizabeth Hope Vann, and Sue Davis, as parent
and next friend of Valorie Eicher, a minor, Tristan Eicher, a
minor, and Cody Ballinger, a minor (hereinafter collectively
referred to as "the plaintiffs"), to the Tuscaloosa Circuit
Court. We grant the petitions and issue the writs.
Facts and Procedural History
On December 6, 2015, Valorie Eicher, a resident of Hale
County, was driving a vehicle north on Interstate 59 through
Tuscaloosa
County.
Katie-Elizabeth Hope
Vann,
Tristan
Eicher,
3
1160504, 1160505, 1160517, 1160563
and Cody Ballinger, all also residents of Hale County, were
passengers in the vehicle Valorie was driving. Jackson, an
employee of Schaeffler and a resident of Tuscaloosa County,
was also driving a vehicle, owned by Gelco, north on
Interstate 59 in the lane next to the vehicle being driven by
Valorie. Jackson made an improper lane change, which forced
Valorie to drive her vehicle partially off the interstate.
Valorie lost control of her vehicle as she attempted to drive
the vehicle back onto the interstate. Ultimately, the vehicle
Valorie was driving overturned and rolled approximately two
and one-half times, ejecting all the occupants from the
vehicle. All the occupants in the vehicle driven by Valorie
sustained injuries; Vann died at the scene of the accident as
a result of the injuries she incurred. Deandra Bland, a
Mississippi resident, witnessed the accident.
Valorie, Tristan, and Ballinger were transported from the
scene of the accident to DCH Regional Medical Center, which is
located in Tuscaloosa County, by Northstar EMS, Inc.
("Northstar"), which has its principal place of business in
Tuscaloosa County. Bradley Bible, Susan Gault, and Tyler
Kelley, employees of Northstar, responded to the scene of the
4
1160504, 1160505, 1160517, 1160563
accident and helped in transporting Valorie, Tristan, and
Ballinger to DCH Regional Medical Center; all live and work in
Tuscaloosa County. Vann's body was transported to the Alabama
Department of Forensic Sciences' morgue, which is located in
Tuscaloosa County.
Orlander Marbury and Jason Vice, Alabama State Troopers
employed by the Alabama Law Enforcement Agency ("ALEA"), were
two of the officers who investigated the accident. Vice's
affidavit testimony indicates that he lives in Tuscaloosa
County. Marbury's and Vice's affidavits state that "[a]ll of
the State Troopers that investigated this accident are based
out of the ALEA Post located in Tuscaloosa County, Alabama."
Jamaine Isaac, a supervisor at the Tuscaloosa County ALEA
post, indicated in his affidavit testimony that the State
Troopers stationed at the Tuscaloosa County ALEA post "are
assigned to cover and investigate incidents and accidents in
several counties." The parties have not directed this Court's
attention to any evidence indicating that the State Troopers
stationed at the Tuscaloosa County ALEA post do any work in
Hale County.
5
1160504, 1160505, 1160517, 1160563
At the time of the accident, Midsouth was performing
construction work in an area on Interstate 59 in Tuscaloosa
County that encompassed the scene of the accident. Michael
Patterson and Bret Thornton are employed by Midsouth; they
were the managers of the Midsouth construction project in
Tuscaloosa County. Patterson resides in Tuscaloosa County.
Patterson's and Thornton's affidavits state that "[a]ll
physical evidence [they are] aware of relating to this
accident is located in Tuscaloosa County."
Midsouth, USAA, and Schaeffler also conducted business in
Hale County unrelated to the work Midsouth was conducting in
Tuscaloosa County at the scene of the accident.
On May 15, 2016, the plaintiffs sued the defendants in
the Hale Circuit Court. Subsequently, all the defendants
filed motions for a change of venue, arguing that the doctrine
of forum non conveniens necessitated the transfer of the case
from the Hale Circuit Court to the Tuscaloosa Circuit Court.
On September 20, 2016, the plaintiffs filed a response to the
defendants' motions for a change of venue.
6
1160504, 1160505, 1160517, 1160563
On February 22, 2017, the Hale Circuit Court entered the
following order denying the defendants' motions for a change
of venue:
"This matter comes before the court on the
various motions to transfer this case from the
Circuit Court of Hale County, Alabama, to the
Circuit Court of Tuscaloosa County, Alabama. No
party has raised or challenged the propriety of
venue in Hale County, and the court finds that Hale
County, Alabama, is a proper venue for this case.
The only issue raised for consideration within the
pending motions is a transfer of venue pursuant to
the doctrine of forum non conveniens.
"The ... defendants filed separate motions to
transfer venue on forum non conveniens grounds, and
the plaintiffs filed a consolidated response to
those motions on September 20, 2016. Defendant
Mid-South Paving filed a motion to strike addressing
various evidentiary submissions filed with the
plaintiffs’ response brief. The plaintiffs were
granted leave to respond to the motion to strike and
filed their response and accompanying submissions on
January 31, 2017. Upon consideration of those
written submissions, as well as the oral arguments
made to the court on the motions to transfer, the
court finds that the defendants did not establish
that
Tuscaloosa
County
is
significantly
more
convenient than Hale County for the litigation of
this case, nor have the defendants established that
the interests of justice warrant a transfer to
Tuscaloosa County. Accordingly, the court hereby
DENIES the defendants’ motions to transfer this
matter to Tuscaloosa County on the grounds of forum
non conveniens."
(Capitalization in orignal.)
Standard of Review
7
1160504, 1160505, 1160517, 1160563
"'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 [exceeded] 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).'"
Ex parte Southeast Alabama Timber Harvesting, LLC, 94 So. 3d
371, 373 (Ala. 2012) (quoting Ex parte National Sec. Ins. Co.,
727 So.2d 788, 789 (Ala. 1998)).
Discussion
The defendants argue that the Hale Circuit Court exceeded
its discretion in denying their motions for a change of venue.
The defendants argue that the action should be transferred to
the Tuscaloosa Circuit Court under Alabama's forum non
conveniens statute, § 6-3-21.1(a), Ala. Code 1975.
Section 6-3-21.1(a) states, in pertinent part:
8
1160504, 1160505, 1160517, 1160563
"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 and the case shall proceed
as though originally filed therein."
This Court explained the application of § 6-3-21.1(a) in Ex
parte Tier 1 Trucking, LLC, [Ms. 1150740, Sept. 30, 2016] ___
So. 3d ___, ___ (Ala. 2016):
"[C]oncerning
whether
an
action
should
be
transferred under § 6–3–21.1, this Court has stated:
"'"A party moving for a transfer under
§ 6–3–21.1 has the initial burden of
showing, among other things, one of two
factors: (1) that the transfer is justified
based on the convenience of either the
parties or the witnesses, or (2) that the
transfer is justified 'in the interest of
justice.'" Ex parte Indiana Mills & Mfg.,
Inc., 10 So. 3d 536, 539 (Ala. 2008).
Although we review a ruling on a motion to
transfer to determine whether the trial
court exceeded its discretion in granting
or denying the motion, id., where "the
convenience of the parties and witnesses or
the interest of justice would be best
served by a transfer, § 6–3–21.1, Ala. Code
1975, compels the trial court to transfer
the action to the alternative forum." Ex
parte First Tennessee Bank Nat'l Ass'n, 994
So. 2d 906, 912 (Ala. 2008) (emphasis
added).'
"Ex parte Wachovia Bank, N.A., 77 So. 3d 570, 573
(Ala. 2011).
9
1160504, 1160505, 1160517, 1160563
"'"The purpose of the doctrine of
forum non conveniens is to 'prevent the
waste of time, energy, and money and also
to protect witnesses, litigants, and the
public against unnecessary expense and
inconvenience.'"
Ex
parte
Perfection
Siding, Inc., 882 So. 2d 307, 312 (Ala.
2003) (quoting Ex parte New England Mut.
Life Ins. Co., 663 So. 2d 952, 956 (Ala.
1995)). We note that "litigation should be
handled in the forum where the injury
occurred" and that "one of the fundamental
purposes of the doctrine of forum non
conveniens is to spare witnesses the
unnecessary inconvenience associated with
testifying in a distant forum." Ex parte
Sawyer, 892 So. 2d 898, 904 (Ala. 2004).'
"Ex parte Kane, 989 So. 2d 509, 512 (Ala. 2008).
"'"The 'interest of justice'
prong of § 6–3–21.1 requires '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.' Ex parte National
Sec. Ins. Co., 727 So. 2d [788,]
790 [(Ala. 1998)]. Therefore, 'in
analyzing
the
interest-of-justice
prong of § 6–3–21.1, this Court
focuses on whether the "nexus" or
"connection"
between
the
plaintiff's
action
and
the
original forum is strong enough
to
warrant
burdening
the
plaintiff's
forum
with
the
action.' Ex parte First Tennessee
Bank Nat'l Ass'n, 994 So. 2d 906,
911 (Ala. 2008). Additionally,
this
Court
has
held
that
'litigation should be handled in
10
1160504, 1160505, 1160517, 1160563
the
forum
where
the
injury
occurred.' Ex parte Fuller, 955
So. 2d 414, 416 (Ala. 2006).
Further, in examining whether it
is in the interest of justice to
transfer a case, we consider 'the
burden of piling court services
and resources upon the people of
a county that is not affected by
the case and ... the interest of
the people of a county to have a
case that arises in their county
tried close to public view in
their county.' Ex parte Smiths
Water & Sewer Auth., 982 So. 2d
484, 490 (Ala. 2007)."'
"Ex parte Quality Carriers, Inc., 183 So. 3d 937,
942 (Ala. 2015) (quoting Ex parte Indiana Mills &
Mfg., Inc., 10 So. 3d 536, 540 (Ala. 2008)).
"'Although it is not a talisman, the fact
that the injury occurred in the proposed
transferee
county
is
often
assigned
c o n s i d e r a b l e
w e i g h t
i n
a n
interest-of-justice analysis. See Ex parte
Autauga Heating & Cooling, LLC, 58 So. 3d
745, 748 (Ala. 2010) ("'[T]his Court has
held that "litigation should be handled in
the forum where the injury occurred."'"
(quoting Ex parte Indiana Mills, 10 So. 3d
at 540)); Ex parte McKenzie Oil, Inc., 13
So. 3d 346, 349 (Ala. 2008) (same).'
"Ex parte Wachovia, 77 So. 3d at 573–74."
The defendants argue that this action should be
transferred under either the convenience or the interest-of-
justice prong of § 6–3–21.1. However, the defendants' primary
11
1160504, 1160505, 1160517, 1160563
argument is that the interest-of-justice prong of § 6–3–21.1
necessitates the transfer of this case from the Hale Circuit
Court to the Tuscaloosa Circuit Court. In so arguing, the
defendants rely primarily upon Ex parte Tier 1, supra.
The facts considered by this Court in Ex parte Tier 1 are
remarkably similar to those presented in the present case. In
Ex parte Tier 1, a vehicle driven by Jimmy Lee Mixon, a
resident of Wilcox County, collided with a tractor-trailer
owned by Tier 1 Trucking, LLC ("Tier 1"), and driven by a Tier
1 employee, who was a resident of Conecuh County; the accident
occurred in Conecuh County. Mixon was transported by a
company located in Conecuh County to a medical facility
located in Conecuh County to receive medical treatment for the
injuries he sustained in the accident. The accident was
investigated by a local law-enforcement agency located in
Conecuh County. Tier 1 conducted some business in Wilcox
County, but its principal office was located in Florida.
Mixon and his wife sued Tier 1 and its employee in the
Wilcox Circuit Court. Tier 1 and the employee filed a motion
to transfer the action from the Wilcox Circuit Court to the
Conecuh Circuit Court under § 6-3-21.1(a). The Wilcox Circuit
12
1160504, 1160505, 1160517, 1160563
Court denied the motion to transfer. Tier 1 and the employee
then petitioned this Court for a writ of mandamus directing
the Wilcox Circuit Court to vacate its order denying the
motion for a change of venue and to enter an order
transferring the action to the Conecuh Circuit Court.
In granting Tier 1 and the employee's petition and
issuing the requested writ, this Court provided the following
commentary on Alabama law pertaining to the interest-of-
justice prong:
"On multiple occasions, this Court has found
that a venue where the accident occurred, where a
party resides, and where other witnesses reside has
a much stronger connection to the action than a
venue where the only connection with the action is
that a party resides there and a defendant does some
business there. See, e.g., Ex parte Kane, 989 So. 2d
509, 513 (Ala. 2008) (requiring transfer of a
personal-injury action for 'both the convenience of
the parties and witnesses and the interest of
justice' from a venue where the plaintiff resided
and where the defendant automobile-liability insurer
had done some business to a venue where the accident
occurred and where the alleged tortfeasor, the
investigating officer, and all the other witnesses
that had been identified resided); Ex parte Wayne
Farms, LLC, 210 So. 3d 586 (Ala. 2016) (holding that
the interest of justice required transfer of a
personal-injury action from a venue where an
individual defendant resided and where the corporate
defendant did some business to a venue where the
accident occurred, where the plaintiffs resided,
where most of the emergency personnel who responded
to accident were located, where one plaintiff
13
1160504, 1160505, 1160517, 1160563
received
medical
treatment,
and
where
all
interactions and business transactions between the
corporate defendant and the plaintiffs occurred); Ex
parte Autauga Heating & Cooling, LLC, 58 So. 3d 745
(Ala. 2010) (holding that the interest of justice
required transfer of a personal-injury action from
a venue where one of the defendants resided and
where the corporate defendant 'may have some
business connections' to a venue where the accident
occurred, where the plaintiff resided, and where the
emergency medical technician who responded to the
accident resided).
"On one occasion, in Ex parte J & W Enterprises,
150 So. 3d 190 (Ala. 2014), this Court held that,
under the specific facts of that case, the
interest-of-justice
prong
of
the
forum
non
conveniens statute did not warrant transfer to the
venue where the accident occurred. However, in that
particular case, unlike in the present case, none of
the parties lived in the venue where the accident
occurred, the injured plaintiff did not receive
medical treatment in that venue, and no eyewitnesses
were located in that venue. Furthermore, both
defendants were located in the venue where the
action was filed, and the plaintiff resided outside
Alabama."
Ex parte Tier 1, ___ So. 3d at ___. This Court then provided
the following analysis of the facts before it:
"In the present case, the only connections to
Wilcox County are that [Mixon and his wife] reside
there and that Tier 1 has conducted some business
there that was not related to this action. The
undisputed facts show that the accident occurred in
Conecuh County, that one of the defendants resides
in
Conecuh
County,
and
that
law-enforcement
personnel in Conecuh County carried out the
investigation of the accident. Furthermore, there is
evidence indicating that [Mixon] received medical
14
1160504, 1160505, 1160517, 1160563
treatment in Conecuh County. Under our prior
decisions construing § 6–3–21.1, this Court gives
great weight to the fact that the accident occurred
in Conecuh County and to the fact that no material
events occurred in Wilcox County. Further, other
than [Mixon and his wife], no potential witnesses
who reside in Wilcox County have been identified.
... Also, although the affidavit of the police
officer who investigated the accident stated that it
would not be inconvenient for him to travel to
Wilcox County, he is employed by a local police
department located in Conecuh County that is tasked
with serving the people of Conecuh County, and his
investigation occurred in Conecuh County."
___ So. 3d at ___. Based on the above analysis, this Court
concluded:
"There is no reason to burden the people of Wilcox
County with the use of their court services and
other resources for a case that predominately
affects another county, and we recognize the
interest of the people of Conecuh County to have a
case that arose in their county tried close to
public view in their county. Wilcox County, with its
weak connection to the case, should not be burdened
with an action that arose in Conecuh County, with
its strong connection to the case, simply because
the plaintiffs reside in Wilcox County and the
corporate defendant has done some business there.
See Ex parte Autauga Heating & Cooling, 58 So. 3d at
750 (stating that '[t]his Court sees no need to
burden Montgomery County, with its weak connection
to the case, with an action that arose in Elmore
County simply because the individual defendant
resides in Montgomery County and the corporate
defendant does some business there'). Therefore,
under § 6–3–21.1, the trial court is compelled to
transfer the case to Conecuh County. See, e.g., Ex
parte Wachovia, 77 So. 3d at 573."
15
1160504, 1160505, 1160517, 1160563
___ So. 3d at ___.
The present case presents a similar factual scenario to
the one presented in Ex parte Tier 1. Tuscaloosa County has
a strong connection to this case. Most significantly, the
accident, which resulted in Vann's death and injuries to
Valorie, Tristan, and Ballinger, occurred in Tuscaloosa
County. Vann's body was transported to a morgue located in
Tuscaloosa County. Valorie, Tristan, and Ballinger received
medical care in Tuscaloosa County for injuries sustained in
the accident. The parties have not directed this Court's
attention to any evidence indicating that Valorie, Tristan, or
Ballinger received medical treatment in Hale County. The
Northstar medical workers who transported Valorie, Tristan,
and Ballinger from the scene of the accident to DCH Regional
Medical Center all live and work in Tuscaloosa County.
Northstar has its principal place of business in Tuscaloosa
County.1 Although the officers who investigated the scene of
1We
note
that
the
plaintiffs argue
that
"Tuscaloosa County
did not employ or pay for the services and resources provided
by" Northstar. The plaintiffs' assertion is based solely on
the fact that Northstar is a private company. Nevertheless,
the plaintiffs have not directed this Court's attention to any
evidence
supporting
their
assertion
that
Tuscaloosa County
did
not pay Northstar for its services.
16
1160504, 1160505, 1160517, 1160563
the accident are employed by ALEA, a State agency, they are
stationed at an ALEA post located in Tuscaloosa County. One
of the investigating officers resides in Tuscaloosa County;
the parties have not directed this Court's attention to any
evidence indicating that any of the investigating officers
reside in Hale County. Although some of the defendants have
conducted business in Hale County, that business is unrelated
to the facts of this case. One of Midsouth's managers over
the Midsouth construction project that encompassed the scene
of the accident resides in Tuscaloosa County and works in
Tuscaloosa County daily.
Hale County has a weak connection to this case. Its only
connections to this case are that the plaintiffs reside in
Hale County and that some of the defendants have done business
there unrelated to this case.
As stated in Ex parte Tier 1:
"There is no reason to burden the people of [Hale]
County with the use of their court services and
other resources for a case that predominately
affects another county, and we recognize the
interest of the people of [Tuscaloosa] County to
have a case that arose in their county tried close
to public view in their county. [Hale] County, with
its weak connection to the case, should not be
burdened with an action that arose in [Tuscaloosa]
County, with its strong connection to the case,
17
1160504, 1160505, 1160517, 1160563
simply because the plaintiffs reside in [Hale]
County and [some of] the ... defendant[s] ha[ve]
done some business there."
___ So. 3d at ___. Accordingly, based on the reasoning and
authorities set forth in Ex parte Tier 1, under § 6–3–21.1,
the Hale Circuit Court is compelled to transfer the case to
the Tuscaloosa Circuit Court.
We note that the plaintiffs argue that Ex parte First
Family Financial Services, Inc., 718 So. 2d 658 (Ala. 1998),
prevents the Hale Circuit Court from transferring the case to
the Tuscaloosa Circuit Court. The portion of Ex parte First
Family relied upon by the plaintiffs states: "'[W]hen the
trial judge determines that a plaintiff is guilty of "forum
shopping" and that the chosen forum is inappropriate because
of
considerations affecting the
court's
own
administrative and
legal problems, the statute provides that the trial court
"shall" transfer the cause.'" 718 So. 2d at 660 (quoting Ex
parte Gauntt, 677 So. 2d 204, 221 (Ala. 1996) (Maddox, J.,
dissenting)). The plaintiffs appear to argue that, in order
to have the case transferred under the interest-of-justice
prong, the defendants are required to demonstrate that the
plaintiffs had engaged in forum shopping and "that litigation
18
1160504, 1160505, 1160517, 1160563
of this matter in Hale County would inappropriately or
adversely affect Hale County's legal or administrative
process." The plaintiffs argue that the defendants failed to
demonstrate either.
However, in Ex parte First Tennessee Bank National Ass'n,
994 So. 2d 906, 911 (Ala. 2008), this Court discounted the
notion that a trial court's use of the interest-of-justice
prong under § 6-3-21.1 first requires a finding that the
plaintiff engaged in forum shopping. This Court stated:
"[N]othing in [Ex parte] First Family [Financial
Services, Inc., 718 So. 2d 658 (Ala. 1998),] limits
a trial court's use of the interest-of-justice prong
under § 6–3–21.1, Ala. Code 1975, to instances in
which the trial court determines that a plaintiff
has engaged in forum shopping. Instead, it appears
from
our
caselaw
that
in
analyzing
the
interest-of-justice prong of § 6–3–21.1, this Court
focuses on whether the 'nexus' or 'connection'
between the plaintiff's action and the original
forum is strong enough to warrant burdening the
plaintiff's forum with the action. See Ex parte
Kane, 989 So. 2d [509,] 512 [(Ala. 2008)] ('"[T]he
'interest of justice' require[s] 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."' (quoting [Ex parte]
National Sec. Ins. Co., 727 So. 2d [788,] 790 [(Ala.
1998)])). See also Ex parte Independent Life &
Accident Ins. Co., 725 So. 2d 955, 957 (Ala. 1998)
('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.'). In this case, [the
19
1160504, 1160505, 1160517, 1160563
defendant] moved the Jefferson Circuit Court to
transfer the action under § 6–3–21.1 on the basis
that the interest of justice warranted the transfer;
thus, the court rightly applied the 'nexus' or
'connection' analysis."
As did the Court in Ex parte First Tennessee Bank, we
have applied the nexus or connection analysis and determined
that the Hale Circuit Court exceeded its discretion in denying
the defendants' request to transfer the action to the
Tuscaloosa Circuit Court. The plaintiffs' argument that the
defendants must demonstrate that the plaintiffs engaged in
forum shopping and that litigation of this matter in the Hale
Circuit Court would inappropriately or adversely affect the
Hale Circuit Court's legal or administrative process is
without merit.
Lastly, we note that the defendants also argue that the
transfer of this case from the Hale Circuit Court to the
Tuscaloosa Circuit Court is justified based on
the
convenience
of the parties and the witnesses. We pretermit discussion of
that argument based on our conclusion that the transfer is
required under the interest-of-justice prong of § 6-3-21.1.
Conclusion
20
1160504, 1160505, 1160517, 1160563
The defendants have demonstrated a clear legal right to
writs of mandamus directing the Hale Circuit Court to vacate
its order denying the defendants' motions for a change of
venue and to enter an order transferring this action to the
Tuscaloosa Circuit Court.
1160504 -- PETITION GRANTED; WRIT ISSUED.
1160505 -- PETITION GRANTED; WRIT ISSUED.
1160517 -- PETITION GRANTED; WRIT ISSUED.
1160563 -- PETITION GRANTED; WRIT ISSUED.
Stuart, C.J., and Bolin, Shaw, Wise, and Bryan, JJ.,
concur.
Main and Sellers, JJ., concur in the result.
21 | September 1, 2017 |
e15698a8-26ae-4609-ac07-a755596e58f6 | South Cent. Bell Telephone Co. v. State | 789 So. 2d 147 | 1960591 | Alabama | Alabama Supreme Court | 789 So. 2d 147 (2000)
SOUTH CENTRAL BELL TELEPHONE COMPANY et al.
v.
STATE of Alabama and State Department of Revenue.
1960591.
Supreme Court of Alabama.
January 7, 2000.
Walter R. Byars of Steiner-Crum, Byars & Main, P.C., Montgomery; David J. Bowling and Courtney G. Hyers of CSX Transportation, Inc., Richmond, Virginia; Walter Hellerstein, University of Georgia School of Law, Athens, Georgia; and D. Owen Blake, Jr., of BellSouth Telecommunications, Inc., Birmingham, for appellants.
Bill Pryor, atty. gen., and Raymond L. Jackson, asst. atty. gen., Edward A. Hosp, deputy legal adviser, Governor's Office; and Joe Espy III of Melton, Espy, Williams & Hayes, P.C., Montgomery, for appellees.
Alton B. Parker, Jr., David P. Donahue, and Frances H. Jackson of Spain & Gillon, L.L.C., Birmingham, for amicus curiae Kane-Miller Corporation.
*148 Russell Jackson Drake and Charlene P. Cullen of Whatley Drake, L.L.P., Birmingham; Roger W. Kirby, Richard L. Stone, and Andrea Bierstein of Kirby, McInerney & Squire, L.L.P., New York City, New York; and Charles Dauphin of Baxley, Dillard, Dauphin & McKnight, Birmingham, for amicus curiae Gladwin Corporation.
David R. Boyd and Dorman Walker of Balch & Bingham, L.L.P., Montgomery; and James F. Hughey, Jr., and Alex B. Leath III of Balch & Bingham, L.L.P., Birmingham, for amicus curiae Alabama Power Company.
Bruce P. Ely, D.W. Wilson, and Christopher R. Grissom of Tanner & Guin, L.L.C., Tuscaloosa, for amici curiae Allegheny Teledyne Incorporated and 62 other foreign corporations.
PER CURIAM.
We are aware that the Alabama Legislature has passed Act No. 665, Ala. Acts 1999, which purports to solve prospectively the Commerce Clause problem with Alabama's franchise tax (see our First Interim Order in this case, dated Nov. 17, 1999), and that this Act has become law with the Governor's signature.
In South Central Bell Telephone Co. v. Alabama, 526 U.S. 160, 119 S. Ct. 1180, 143 L. Ed. 2d 258 (1999) ("South Central Bell"), the Supreme Court did not reserve the question whether its holding should apply retroactively. "When [the Supreme] Court does not reserve the question whether its holding should be applied to the parties before it, ... an opinion announcing a rule of federal law is properly understood to have followed the normal rule of retroactive application and must be read to hold that its rule should apply retroactively to the litigants then before the Court." Harper v. Virginia Dep't of Taxation, 509 U.S. 86, 97-98, 113 S. Ct. 2510, 125 L. Ed. 2d 74 (1993) (internal quotation marks and ellipses omitted). The Taxpayers and interests aligned with the State, including the Attorney General, the Department of Revenue, and the Governor, all agree that the Supreme Court's decision in South Central Bell must be applied retroactively. The question remaining for this Court's determination is what remedy, if any, should be fashioned.
Harper makes it clear that when a tax is ruled unconstitutional, and that ruling is applied retroactively, a State must give a remedy that comports with Federal due-process principles. Harper, 509 U.S. at 100, 113 S. Ct. 2510 (citing American Trucking Ass'ns, Inc. v. Smith, 496 U.S. 167, 181, 110 S. Ct. 2323, 110 L. Ed. 2d 148 (1990)). These principles of due process are found in a line of cases that begin with McKesson Corp. v. Division of Alcoholic Beverages & Tobacco, 496 U.S. 18, 110 S. Ct. 2238, 110 L. Ed. 2d 17 (1990), and its companion case American Trucking Ass'ns., Inc. The McKesson case allows a State to comport with due process by:
1) giving a taxpayer a refund;[1]
2) collecting back taxes from the favored class;[2]
*149 3) combining aspects of these first two options;[3]
4) barring a refund to a taxpayer that did not follow a state procedural law in seeking the refund;[4] or
5) refusing to give a remedy, in the rare case in which the State relied on now overturned precedent and the State now faces an extreme hardship if it must give a remedy.[5]
The United States Supreme Court has remanded this case for proceedings not inconsistent with its opinion. In order to discharge that responsibility, this Court needs further evidence that it, as an appellate court, is ill-suited to gather.
The evidence that we require falls into several categories. We first must have specific statements of position of all parties concerning the efficacy of Act No. 665, Ala. Acts 1999, as a cure for the constitutional defect recognized in South Central Bell. We also require position statements on the question whether Act No. 665 is consistent with §§ 229 and 232 of the Constitution of Alabama of 1901. We further require information as to the extent to which the Bell Companies[6] and CSXT, Inc., have borne the economic impact of the excess franchise taxes collected, so that we can consider the legal effect of any passing through of the burden to customers. See James B. Beam Distilling Co. v. Georgia, 501 U.S. 529, 538-39, 111 S. Ct. 2439, 115 L. Ed. 2d 481 (1991). We require a detailed explanation of the manner in which the Bell Companies and CSXT, Inc., contend that they complied with applicable provisions of state law[7] governing contests of assessments.
We also require information in another area because we cannot at this juncture foreclose the prospect that this case constitutes that "rare case" of reliance coupled with hardship (see item 5 in the listing above). In 1989, this Court held that Alabama's franchise tax did not violate the Commerce Clause.[8]White v. Reynolds Metals Co., 558 So. 2d 373 (Ala.1989). The United States Supreme Court, consistent with its prior holdings, denied certiorari review, 496 U.S. 912, 110 S. Ct. 2602, 110 *150 L. Ed. 2d 282 (1990). However, in 1999 the United States Supreme Court declared the Alabama franchise tax unconstitutional as violating the Commerce Clause. South Central Bell v. Alabama, supra.
In his dissent to this Court's opinion on the original appeal in this present case, dated March 20, 1998,[9] Justice See observed that our holding in Reynolds Metals was premised on the State's argument, renewed in the original appeal in this case, that the combination of the effects of a higher rate applicable to domestic corporations and the shares tax also imposed on domestic corporations created an intrastate burden that compensated for the higher foreign franchise tax. 711 So. 2d at 1011. Then, Justice See observed that "the Supreme Court has since [our decision in Reynolds Metals] clarified and narrowed the definition of a compensatory tax." Id. Justice See then cited a trilogy of United States Supreme Court cases: Oregon Waste Systems, Inc. v. Department of Environmental Quality of Oregon, 511 U.S. 93, 114 S. Ct. 1345, 128 L. Ed. 2d 13 (1994); Associated Industries of Missouri. v. Lohman, 511 U.S. 641, 114 S. Ct. 1815, 128 L. Ed. 2d 639 (1994); and Fulton Corp. v. Faulkner, 516 U.S. 325, 116 S. Ct. 848, 133 L. Ed. 2d 796 (1996). The United States Supreme Court also noted the evolving nature of recent cases, stating:
South Central Bell, id., 526 U.S. at 164, 119 S. Ct. at 1183 (emphasis added). When the first of the trilogy, all decided after Reynolds Metals, was released, Chief Justice Rehnquist stated in his dissent:
Oregon Waste Systems, Inc., supra, 511 U.S. at 109, 114 S. Ct. 1345 (emphasis added).
With each crank of the ratchet, the increased effect on a State-taxing authority that relies on the former law can be enormous. After it had decided McKesson Corp., the Supreme Court addressed the role of reliance, in James B. Beam Distilling Co. v. Georgia, 501 U.S. at 543-44, 111 S. Ct. 2439, stating that "nothing we say here precludes consideration of individual equities when deciding remedial issues in specific cases," and that "[n]othing we say here deprives [the State of its] opportunity... to demonstrate reliance interests entitled to consideration in determining the *151 nature of the remedy that must be provided, a matter with which McKesson did not deal."
After James B. Beam Distilling Co., the Supreme Court rejected the imposition of a remedial limitation upon the retroactive application of a new rule to pending cases, in the context of an Ohio tolling statute that discriminated against out-of-state defendants. See Reynoldsville Casket Co. v. Hyde, 514 U.S. 749, 757-58, 115 S. Ct. 1745, 131 L. Ed. 2d 820 (1995), where the Court declined to extend the rule protecting a state official sued individually from personal liability where the unconstitutional conduct of the official was not "clearly established" at the time of the arrest. In so holding, the Court noted the absence of "significant policy justifications" that are presented in proceedings such as actions against law-enforcement officers where burdens would fall on "society as a whole" if the rule were otherwise. 514 U.S. at 758-59, 115 S. Ct. 1745.[10] However, because of the inadequacy of the record now before us, we do not today reach these issues.[11] We must have evidence concerning the extent to which the State relied on the actions of the United States Supreme Court in the years since Reynolds Metals, as well as each party's assessment of the effect of the trilogy of cases beginning with Oregon Waste Systems in 1994. We also require evidence as to the hardship or disruption that might occur if full refunds are allowed and any other evidence that might support policy justifications sufficient to permit a remedial limitation on retroactive application of the ruling holding the tax invalid.
In order to fashion a remedy that complies with the Constitution and the holdings of the United States Supreme Court, we remand this case for the parties to present evidence dealing with the issues described in this Second Interim Order. We do not remand for a finding of fact by the trial court. The trial court must provide this Court with all necessary supporting documents, exhibits, and such sworn testimony as may be necessary to create a complete record. The information should be based on facts and, where stipulations are alleged to preclude the exercise of rights, the underlying facts shall be presented as if the stipulations did not exist. In areas where the evidence is in conflict, the trial court shall require the parties to identify such areas with specificity so that this Court can determine what further proceedings may be necessary. When the record called for in this Second Interim Order has been completed and the circuit court has made its return to today's remand, this Court will establish a briefing schedule so that the parties and amici curiae can address new issues presented by that record.
REMANDED WITH INSTRUCTIONS.[*]
*152 COOK, SEE, LYONS, BROWN, JOHNSTONE, and ENGLAND, JJ., concur.
HOOPER, C.J., and MADDOX and HOUSTON, JJ., concur specially.
HOOPER, Chief Justice, and MADDOX and HOUSTON, Justices (concurring specially).
We request answers to the questions set out below. For the purpose of clarity, we provide the following definitions for phrases appearing in these questions:
"Foreign corporations" refers to corporations that were not incorporated in Alabama and paid franchise taxes pursuant to former § 40-14-41, Ala.Code 1975.
"Domestic corporations" refers to corporations that were incorporated within the State of Alabama and paid franchise taxes pursuant to former § 40-14-40, Ala.Code 1975.
"Under collecting" or "under paying" refers to the unconstitutional practice of the Alabama Department of Revenue of collecting franchise taxes based on the par value of the domestic corporation's capital stock, when the Department, by statute and the Alabama Constitution, should have been collecting the tax based on the domestic corporation's value. See this Court's First Interim Order in this case, dated November 17, 1999, 789 So. 2d 133 (Ala.1999).
"Bell Companies" refers to BellSouth Corporation, BellSouth Services, Inc., BellSouth Financial Services Corporation, BellSouth Advertising & Publishing Corporation, BellSouth Resources, Inc., BellSouth Products, Inc., Alabama Cellular Services, Inc., Sunlink Corporation, and TechSouth, Inc.
These are the questions:
1. (A) Do all parties agree that Act No. 665, Ala. Acts 1999, resolved prospectively the Commerce Clause problem as identified in South Central Bell Telephone Co. v. Alabama, 526 U.S. 160, 119 S. Ct. 1180, 143 L. Ed. 2d 258 (1999), concerning how Alabama's franchise tax has been assessed and collected? (B) If not, please explain in full.
2. (A) Do all parties agree that Act No. 665, Ala. Acts 1999, is consistent with §§ 229 and 232 of the Constitution of Alabama 1901? (B) If not, please explain in full.
3. (A) Do all parties agree that Act No. 665, Ala. Acts 1999, prevents the Department of Revenue, prospectively, from under collecting franchise taxes from domestic corporations? (B) If not, please explain in full.
4. Did South Central Bell Telephone Company bear the economic impact of the excess in franchise taxes assessed against foreign corporations over the franchise taxes assessed against domestic corporations for each year that it is claiming a refund or did it pass the burden on as an addition to the price that its customers were legally obligated to pay? See James B. Beam Distilling Co. v. Georgia, 501 U.S. 529, 538-39, 111 S. Ct. 2439, 115 L. Ed. 2d 481 (1991).
5. Did CSXT, Inc., bear the economic impact of the excess in franchise taxes assessed against foreign corporations over the franchise taxes assessed against domestic corporations for each year that it is claiming a refund or did it pass the burden *153 on as an addition to the price that its customers were legally obligated to pay? See James B. Beam Distilling Co. v. Georgia, 501 U.S. 529, 538-39, 111 S. Ct. 2439, 115 L. Ed. 2d 481 (1991).
6. Did the Bell Companies bear the economic impact of the excess in franchise taxes assessed against foreign corporations over the franchise taxes assessed against domestic corporations for each year that they are claiming refunds or did they pass the burden on as an addition to the price that their customers were legally obligated to pay? See James B. Beam Distilling Co. v. Georgia, 501 U.S. 529, 538-39, 111 S. Ct. 2439, 115 L. Ed. 2d 481 (1991).
7. (A) Explain how each plaintiff complied with former § 40-2-22, Ala.Code 1975, in contesting the franchise-tax assessment for each year for which it is seeking a refund (1982 through 1992). (B) Explain how each plaintiff complied with § 40-2A-7, Ala.Code 1975, in contesting the franchise-tax assessment for each year for which it is seeking a refund (1992 through 1999).
8. In 1989, after the Court of Civil Appeals had declared the Alabama franchise tax unconstitutional as violating the Equal Protection Clause of the United States Constitution (White v. Reynolds Metals Co., 558 So. 2d 367 (Ala.Civ.App. 1989)), what actions, if any, did the Governor, the Attorney General, and/or the State Legislature take relating to the problem dealt with in that case?
9. Did the State of Alabama rely on this Court's decision in White v. Reynolds Metals Co., 558 So. 2d 373 (Ala.1989); the United States Supreme Court's cases cited therein; and the subsequent denial of certiorari review by the United States Supreme Court, 496 U.S. 912, 110 S. Ct. 2602, 110 L. Ed. 2d 282 (1990), when it continued after 1989 to assess and collect franchise taxes from the domestic corporations and foreign corporations as it had been collecting those taxes before this Court issued its decision in White v. Reynolds Metals Co., 558 So. 2d 373 (Ala.1989)?
10. (A) What is the estimated amount the State of Alabama would have to pay if it is required to fully refund the franchise taxes paid by the plaintiffs during the contested tax years? (B) What impact would such a refund payment have on the State's ability to provide necessary services to the people of Alabama?
11. (A) What is the estimated amount that the State of Alabama would have to pay if it is required to fully refund the franchise taxes paid by other foreign corporations that have pending actions seeking refunds? (B) What impact would such a refund payment have on the State's ability to provide necessary services to the people of Alabama?
12. (A) What is the estimated amount that the State of Alabama would have to pay if it is required to fully refund the franchise taxes paid by all foreign corporations for the past three years? (B) What impact would such a refund payment have on the State's ability to provide necessary services to the people of Alabama?
13. Under former § 40-14-41, Ala. Code 1975, were franchise taxes being assessed and collected by the State of Alabama from foreign corporations on items that would not normally be included in ascertaining the actual value of assets used by foreign corporations in Alabama?
14. (A) If the answer to question 13 is "yes," what is the estimated amount that the State of Alabama would have to pay if it is required to refund to plaintiffs franchise taxes collected on items that would not normally be included in ascertaining the actual value of assets used by the plaintiffs in Alabama during the contested tax years? (B) What impact would such a *154 refund payment have on the State's ability to provide necessary services to the people of Alabama?
15. (A) If the answer to question 13 is "yes," what is the estimated amount that the State of Alabama would have to pay if it is required to refund to foreign corporations that have pending actions against the State, other than the plaintiffs, the franchise taxes collected on items that would not normally be included in ascertaining the actual value of assets used by those foreign corporations in Alabama during the contested tax years? (B) What impact would such a refund payment have on the State's ability to provide necessary services to the people of Alabama?
16. (A) If the answer to question 13 is "yes," what is the estimated amount that the State of Alabama would have to pay if it is required to refund to all foreign corporations the franchise taxes collected on items that would not normally be included in ascertaining the actual value of assets used by foreign corporations in Alabama during the contested tax years? (B) What impact would such a refund payment have on the State's ability to provide necessary services to the people of Alabama?
17. If the Department of Revenue attempted to collect back taxes from underpaying domestic corporations based on the excess of the corporation's value over the par value of the corporation's stock: (A) What difficulties, if any, would the Department of Revenue face in attempting to assess and collect those taxes? (B) What estimated expenses would the Department incur in attempting to assess and collect such taxes? (C) What effect would the principle of law enunciated in Ex parte Sizemore, 605 So. 2d 1221 (Ala.1992), and Morgan County v. Jones, 740 So. 2d 1063 (Ala.1999), have on the Department's attempt to retroactively collect taxes that this Court in its First Interim Order in this case held should have been collected from domestic corporations in accordance with § 229 of the Constitution of Alabama of 1901 and § 40-14-40, Ala.Code 1975?
We welcome supplemental briefs from the parties and amici curiae on the issues addressed by this special concurrence addressed to the Second Interim Order.
[1] See McKesson Corp., 496 U.S. at 40, 110 S. Ct. 2238.
[2] See McKesson, 496 U.S. at 40, 110 S. Ct. 2238. We make no determination as to whether back taxes can be collected through assessments by the Department of Revenue for prior years under now repealed § 40-14-40, Ala.Code Ala.1975, based upon the interpretation of § 229, Constitution of Alabama of 1901, given in our Interim Order of November 17, 1999, as opposed to the Legislature's enactment of retroactive taxes on previously favored domestic corporations. Of course, such legislation would have to satisfy federal due process. See McKesson, 496 U.S. at 40 n. 23, 110 S. Ct. 2238; United States v. Carlton, 512 U.S. 26, 30-31, 114 S. Ct. 2018, 129 L. Ed. 2d 22 (1994) (retroactivity must serve rational legislative purpose and must be for a short and limited period).
[3] See McKesson, 496 U.S. at 40, 110 S. Ct. 2238.
[4] See McKesson, 496 U.S. at 36-37, 110 S. Ct. 2238.
[5] See McKesson, 496 U.S. at 44-45, 110 S. Ct. 2238 (observing that in the particular facts of that case, Florida's hardship did not outweigh the need for a refund). But, see, Reynoldsville Casket Co. v. Hyde, 514 U.S. 749, 757-58, 115 S. Ct. 1745, 131 L. Ed. 2d 820 (1995), discussed infra, 789 So. 2d at 151.
[6] The term "Bell Companies" refers to BellSouth Corporation; BellSouth Services, Inc.; BellSouth Financial Services Corporation; BellSouth Advertising & Publishing Corporation; BellSouth Resources, Inc.,; BellSouth Products, Inc.; Alabama Cellular Services, Inc.; Sunlink Corporation; and TechSouth, Inc.
[7] See Ala.Code 1975, former § 40-2-22, for the years 1982-1992 and § 40-2A-7 for the years 1992-1999. Failure to comply with state procedural requirements can preclude a recovery of taxes paid pursuant to a levy or assessment that violates the United States Constitution. McKesson, 496 U.S. at 45, 110 S. Ct. 2238; Reynoldsville Casket Co. v. Hyde, 514 U.S. at 757-58, 115 S. Ct. 1745.
[8] The United States Supreme Court had previously held, in two separate cases, that Alabama's franchise tax did not violate the Commerce Clause of the United States Constitution. Southern Natural Gas Corp. v. Alabama, 301 U.S. 148, 57 S. Ct. 696, 81 L. Ed. 970 (1937); and Kansas City, M. & B.R.R. v. Stiles, 242 U.S. 111, 37 S. Ct. 58, 61 L. Ed. 176 (1916).
[9] South Cent. Bell Tel. Co. v. State, 711 So. 2d 1005 (Ala.1998), reversed, 526 U.S. 160, 119 S. Ct. 1180, 143 L. Ed. 2d 258 (1999).
[10] Justice Kennedy, joined by Justice O'Connor, concurred in the judgment in Reynoldsville Casket Co. He wrote:
"We do not read today's opinion to surrender in advance our authority to decide that in some exceptional cases, courts may shape relief in light of disruption of important reliance interests or the unfairness caused by unexpected judicial decisions. We cannot foresee the myriad circumstances in which the question might arise."
514 U.S. at 761, 115 S. Ct. 1745. (Kennedy, J., concurring in the judgment.)
[11] Even if we subsequently hold that Reynoldsville Casket Co., precludes a consideration of circumstances that justify withholding a remedy for some or all of the years in question, the matter is of sufficient import to justify giving the State the opportunity to make a record on the issue in the event of subsequent review of these proceedings by the United States Supreme Court.
[*] Note from the reporter of decisions: The Supreme Court's docket sheet carries these entries:
"9-12-00 Agreement between State of Ala., Ala. Dept. of Revenue, and BellSouth Telecommunications, and BellSouth Corporation.
"9-13-00 All parties' motion to dismiss appeal
"10-10-00 Appeal dismissed; no opinion.
"10-18-00 Amended order of dismissal." | January 7, 2000 |
d940fe99-0d6b-4a2d-a635-854df465430c | Pickens v. Estate of Donald Harrison Fenn | N/A | 1160202 | Alabama | Alabama Supreme Court | REL: 09/29/2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
SPECIAL TERM, 2017
____________________
1160202
____________________
Janice Pickens
v.
Estate of Donald Harrison Fenn, deceased
Appeal from Elmore Probate Court
(No. 2016-183)
SELLERS, Justice.
Janice Pickens appeals from the order of the Elmore
Probate Court denying the admission to probate of a will on
the basis that the will was not signed by at least two
1160202
witnesses as required by § 43-8-131, Ala. Code 1975. We
reverse and remand.
I. Facts
Donald Harrison Fenn died on June 27, 2016. Fenn left
a will, purportedly executed by him on November 24, 2015,
leaving all of his property to Pickens and naming her as his
personal representative.1
On July 6, 2016, Jackson B. Dismukes, one of Fenn's
friends, filed a petition for letters of administration,
asserting that Fenn had died with assets in Alabama but that
he had no will. On that same day, the probate court granted
Dismukes's petition and issued him letters of administration
for Fenn's estate.
On July 7, 2016, Pickens filed a petition seeking to
probate the will purportedly executed by Fenn. Pickens
further moved the probate court to revoke the letters of
administration it had issued to Dismukes.
Dismukes challenged
1Pickens was a certified nurse assistant; she had known
Fenn for approximately nine years; and she had moved into his
house to take care of him during his illness. At the time of
his death, Fenn was survived by two adult daughters--
Elizabeth Ann DeBardelaben of Texas and Sarah E. Whitby of
Pennsylvania. In March 1984, Fenn had allowed his former
wife's second husband to adopt Sarah.
2
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the admission of the will to probate on the basis that the
will did not contain the signature of a second witness as
required by § 43-8-131.
On October 31, 2016, the probate court conducted a bench
trial for the purpose of determining whether the will could be
admitted to probate and, more specifically, whether the will
complied with the requirements of § 43-8-131. The will was in
writing; it was signed by Fenn; it contained the signature of
one attesting witness, Tracy Stroud Causey; and it contained
the signature and seal of Janet M. Ingram, a duly commissioned
notary public. It was Pickens's position at the hearing that
even though Ingram signed the notarization of Fenn's and
Causey's signatures in her capacity as a notary public, her
signature on the will satisfied the statutory requirements of
a witness under § 43-8-131. The probate court heard the
testimony of both Causey and Ingram. Ingram testified that,
on November 24, 2015, Fenn came into the law office where she
was working and inquired whether she would notarize
"something" for him. Ingram stated that she took Fenn to her
office, where he handed her a document. Ingram testified that
she did not know that the document was a will but that she did
3
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notice that the document required the signature of a witness;
accordingly, Ingram called Causey to her office to witness
Fenn sign the document. Ingram admitted that the document
contained a signature line for a second attesting witness;
however, she stated that she did not recall seeing the
additional signature line at the time she had Causey sign the
document as a witness. Finally, Ingram testified that she did
not sign the document as a witness but, rather, in her
capacity as a notary public. Causey testified that she
witnessed Fenn sign the document and that she witnessed Ingram
notarize the document.
After hearing the testimony, the probate court entered an
order refusing to admit the will to probate, on the basis
that Ingram had signed the will in her capacity as a notary,
not as a witness, and that, therefore, the requirement of §
43-8-131 calling for two witnesses to a will was not
satisfied. Pickens appealed. See § 12-22-21, Ala. Code 1975.
II. Standard of Review
"This Court reviews de novo [a probate] court's
interpretation of a statute, because only a question of law is
4
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presented." Scott Bridge Co. v. Wright, 883 So. 2d 1221, 1223
(Ala. 2003).
III. Discussion
A. The Will
Pages two and three of the will containing the signatures
of Fenn, Causey, and Ingram read as follows:
"IN WITNESS WHEREOF, I, Donald Harrison Fenn,
the Testator, sign my name to this instrument as my
last will and testament this 24 day of Nov. 2015,
and being first duly sworn, do hereby declare to the
undersigned authority that I sign and execute this
instrument as my last will and testament, and that
I sign it willingly, and that I execute it as my
free and voluntary act and deed for the purposes
therein expressed, and that I am at least 19 years
of age, of sound mind, and under no constraint,
duress, fraud [or] undue influence.
"[/s/ Donald Harrison Fenn].
"We, ___________________________________ and Tracy
Stroud Causey, the witnesses, sign our names to this
instrument, and, being first duly sworn, do each
hereby declare to the undersigned authority that
Donald Harrison Fenn, the Testator, signed and
executed this instrument as his last will and
testament and that he signed it willingly, and that
each of us, in the presence and hearing of the
Testator and each other, hereby signs this will as
witness to the Testator's signing, and that to the
best of each of our knowledge the Testator is at
least 19 years of age, of sound mind and under no
constraint, duress, fraud or undue influence.
"[Signature of Tracy Stroud Causey]
5
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"having an address at
"----Main Street Millbrook, AL
36054
"________________________________
"having an address at
"_______________________________
"STATE OF ALABAMA
"COUNTY OF ELMORE
"Subscribed, sworn and acknowledge[d] before me
by the said Donald Harrison Fenn, Testator, and
subscribed and sworn to before me by the said Donald
Fenn and Tracy Causey as witness, this 24th day of
Nov. 2015.
"/s/Janet M. Ingram
"Notary Public
"My commission expires: [seal]."
B. Analysis
Section 43–8–131 governs the formal requirements for the
execution of a will:
"Except
as
provided
within
section
43-8-135,[Ala. Code 1975,] every will shall be in
writing signed by the testator or in the testator's
name by some other person in the testator's presence
and by his direction, and shall be signed by at
least two persons each of whom witnessed either the
6
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signing or the testator's acknowledgment of the
signature or of the will."2
(Emphasis added.) The statute requires (1) that the will be
in writing and (2) that it be signed by the testator (or by
someone in the testator's presence and at his or her
direction). In this case, it is undisputed that the will is in
writing and that it is signed by Fenn. Therefore, the first
two requirements of the statute are satisfied. The statute
also requires that a will be signed by at least two persons
who witnessed the testator performing one of three acts:
signing the will, acknowledging the document as his will, or
acknowledging his signature on the will. In this case, Causey
signed as an attesting witness and Ingram signed in her
capacity as a notary public. Whether a notary who signs a
will in his or her capacity as a notary can be considered a
2Section 43-8-132, Ala. Code 1975, governs the execution
of a self-proved will. Pickens concedes that the will does not
meet the requirements for a self-proved will; thus, the issue
whether the will is self-proving is not before us. See Ex
parte Ricks, 164 So. 3d 1141, 1144 n. 2 (Ala. 2014)
("Self-proving wills are 'self-proved, by the acknowledgment
thereof by the testator and the affidavits of the witnesses,
each made before an officer authorized to administer oaths
under the laws of the state where the acknowledgment occurs
and evidenced by
the
officer's certificate, under the official
seal, attached or annexed to the will.' § 43–8–132, Ala. Code
1975." (Emphasis omitted.)
7
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valid witness to a will under § 43-8-131 is a question of
first impression for this Court.
We begin our analysis by noting that "[t]he polestar of
statutory construction is to ascertain and give effect to the
Legislature's intent in enacting a statute." Ex parte
Berryhill, 801 So. 2d 7, 9-10 (Ala. 2001). In this case, the
Commentary to § 43-8-131 makes clear the intent of the
statute, which is to validate wills meeting the minimum
formalities of the statute:
"The formalities for execution of a witnessed
will have been reduced to a minimum. Execution
under this section normally would be accomplished by
signature of the testator and of two witnesses; each
of the persons signing as witnesses must 'witness'
any of the following: the signing of the will by the
testator, an acknowledgment by the testator that the
signature is his, or an acknowledgment by the
testator that the document is his will. ... There is
no requirement that the testator publish the
document as his will, or that he request the
witnesses to sign, or that the witnesses sign in the
presence of the testator or of each other. The
testator may sign the will outside the presence of
the witnesses, if he later acknowledges to the
witnesses that the signature is his or that the
document is his will, and they sign as witnesses.
There is no requirement that the testator's
signature be at the end of the will; thus, if he
writes his name in the body of the will and intends
it to be his signature, this could satisfy the
8
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statute. The intent is to validate wills which meet
the minimum formalities of the statute."3
(Emphasis added.) It is also noteworthy to add that, when the
validity of a will is being challenged, the trial court or,
in this case, the probate court, is guided by the following
general principle: "Instead of indulging suspicion or
conjecture to destroy the validity of wills, the courts are
bound to support them against mere suspicion or conjecture;
bound to support them, when any theory or hypothesis
maintaining them, is as probable as that which is suggested to
defeat them." Barnewall v. Murrell, 108 Ala. 366, 388, 18 So.
831, 841 (1895). Lastly, the purpose of requiring the
signature of two witnesses "is to remove uncertainty as to the
execution of wills and safeguard testators against frauds and
impositions." Culver v. King, 362 So. 2d 221, 222 (Ala. 1978).
With these above principles in mind, we now address the
issue whether Ingram's signature on the will in her capacity
as a notary public can constitute the signature of a person
3Under the previous statute governing the execution of
wills, § 43-1-130, Ala. Code 1975 (repealed in 1982), a will
was required, among other things, to be "'attested by at least
two witnesses, who must subscribe their names thereto in the
presence of the testator.'" See Anderson v. Griggs, 402 So. 2d
904, 907 (Ala. 1981)(quoting statute).
9
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witnessing the execution of the will for purposes of § 43-8-
131. In resolving this issue, this Court need look no further
than the plain language of the statute. It is well settled
that
"[w]ords used in a statute must be given their
natural, plain, ordinary, and commonly understood
meaning, and where plain language is used a court is
bound to interpret that language to mean exactly
what it says. If the language of the statute is
unambiguous, then there is no room for judicial
construction and the clearly expressed intent of the
legislature must be given effect."
IMED Corp. v. Systems Eng'g Assocs. Corp., 602 So. 2d 344, 346
(Ala. 1992). Section 43-8-131 is not ambiguous–-it states
that the will shall be signed by at least two "persons" each
of whom "witnessed" either "the signing or the testator's
acknowledgment of the signature or of the will." Section 43-
8-134, Ala. Code 1975, states that "[a]ny person generally
competent to be a witness may act as a witness to a will."
(Emphasis added.) The term "persons" as used in § 43-8-131 is
a very broad, rather than restrictive, term. There is simply
nothing in the statute that would prohibit a notary public
from serving as a witness. Indeed, the fact that Ingram
signed the will in her capacity as a notary public is
immaterial to her qualification to serve as a witness to the
10
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will because § 43-8-131 does not require that the signatures
of the testator or the witnesses be notarized. The important
fact here is not the capacity in which Ingram executed the
document, i.e., as a notary public, but rather that she
observed Fenn's signing of the document and affixed her
signature thereto. We see no reason to exclude Ingram as a
witness simply because she signed in her official capacity as
a notary public.4 Admittedly, Ingram did not testify that she
4We note that Dismukes cites Weaver v. Grant, 394 So. 2d
15 (Ala. 1981), for the proposition that a person witnessing
a will must posses an intent to act as a witness under § 43-8-
131. Weaver, however, was decided in 1981, at which time §
43-1-130 (repealed in 1982) was in effect. Section 43-8-131,
a part of the new probate code, reduces the formalities for
the execution of a will, and requires only that the will
"shall be signed by at least two persons each of whom
witnessed either the signing or the testator's acknowledgment
of the signature or of the will." Accordingly, under § 43-8-
131, the intent of a person witnessing a will is not essential
to the validity of its execution. See also, e.g., Brown v.
Traylor, 210 S.W.3d 648, 672 (Tex. App. 2006)("A notary may be
considered, and can be competent to be, a subscribing witness
to a will."); In re Estate of Teal, 135 S.W.3d 87, 91 (Tex.
App. 2002)("We now hold that, under the facts in this case,
the notary, although she did not intend to sign as a
subscribing witness, did in fact serve as a subscribing
witness. ... Because there is no requirement that a will be
notarized, [the notary's] signature served no purpose other
than as a witness."); Simpson v. Williamson, 611 So. 2d 544,
546 (Fla. Dist. Ct. App. 1992)("It is well established that
the execution of a will may be valid, even though a required
witness signs in a capacity other than that of a witness.");
Payne v. Payne, 54 Ark. 415, 415, 16 S.W. 1, 1-2 (1891) ("The
11
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was signing as a witness. Rather, she testified that Fenn
asked her to "notarize something." Nevertheless, although
Ingram may not have intended to act as an official witness,
she nonetheless observed Fenn sign the document and then, by
signing, accomplished the purpose and statutory dictates of §
43-8-131. To conclude otherwise would frustrate rather than
further the intent of the statute, which, as previously
indicated, is to validate wills that meet the minimum
formalities of the statute. Moreover, our holding is
consistent with the public policy of this State in carrying
out the intent of the testator and, more specifically,
adhering to the presumption that Fenn, who possessed a will
evidence shows ... a literal compliance with the law in every
respect, except that the testator asked [the justice of the
peace] to put his official certificate to the will, instead of
formally asking him to sign it as a witness. ... [W]e can see
no reason, in law or justice, why the effect of an ordinary
attestation should be denied to it. Whether testifying through
his certificate, or as a witness in a probate proceeding, [the
justice of the peace] was asked to bear witness to the fact
that the writing had been subscribed by and was the will of
the testator. That is the ordinary office of a witness, and as
such [the justice of the peace] signed the will."); and Franks
v. Chapman, 64 Tex. 159, 161 (1885) ("The fact that ... the
clerk of the county court, when called upon by [the testator]
to witness the will, attached thereto his
official certificate
of the acknowledgment of the due execution of the will by the
testator, does not affect the validity of his signature to the
will as a witness.").
12
1160202
and sought to have it notarized, did not intend to die
intestate. Ide v. Harris, 261 Ala. 484, 75 So. 2d 129 (1954).
IV. Conclusion
We conclude that Ingram's signature, albeit in her
capacity as a notary public, is sufficient to meet the
statutory requirements of a witness under § 43-8-131, Ala.
Code 1975. Accordingly, we reverse the order of the probate
court and remand this matter to that court for proceedings
consistent with this opinion.
REVERSED AND REMANDED.
Stuart, C.J., and Bolin, Parker, Main, Wise, and Bryan,
JJ., concur.
Murdock, J., concurs in the rationale in part and concurs
in the result.
Shaw, J., concurs in the result.
13
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MURDOCK, Justice (concurring in the rationale in part and
concurring in the result).
I concur in the main opinion except for the manner in
which Weaver v. Grant, 394 So. 2d 15 (Ala. 1981), and the now
repealed § 43-1-130, Ala. Code 1975, are distinguished at the
outset of footnote 4. See ___ So. 3d at ___ n.4. It appears
to me that Janet M. Ingram's notarization of the will would
have been sufficient as a witnessing of the same under § 43–1-
130. I would distinguish Weaver not on any differences
between the language of § 43-1-130 and the language of the
current statute, § 43-8-131, Ala. Code 1975, but based on the
fact, as the Court noted, that the party whose witnessing was
in question in Weaver had simply written down his name as
proposed executor as part of "notes" he prepared for a friend
"to ... pass[] on to [a] drafting attorney" who was to prepare
the friend's will, there being no intention for the writing of
his name to constitute any sort of "witnessing" of some
instrument. 394 So. 2d at 17.
14 | September 29, 2017 |
6b4168eb-511b-45b9-b486-8b35824e249f | Hinote v. Owens et al. | N/A | 1160268 | Alabama | Alabama Supreme Court | Rel: 09/08/2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
SPECIAL TERM, 2017
____________________
1160268
____________________
Thomas W. Hinote, Cindy S. Hinote, Rebecca L. Dowdy, and
David H. Dowdy
v.
Annette Freeman Owens et al.
Appeal from Fayette Circuit Court
(CV-13-9)
BRYAN, Justice.
This case involves two competing claims to a 40-acre
tract of land ("the property") and whether the rule of repose
may be applied to resolve that dispute. In 1930, Felix
1160268
Jackson Freeman ("Felix") inherited the property from his
father Matt Freeman through Matt's will. Felix married and
had 12 children. The record on appeal contains no evidence
establishing that Felix conveyed the property during his life.
Thus, the record indicates that Felix owned the property when
he died in 1961. Felix died intestate, and he was predeceased
by his wife and three of his children, only one of whom had a
surviving spouse or children. Thus, when Felix died, the
property passed by intestate succession to his nine surviving
children (each having a one-tenth interest) and to the heirs
of one of Felix's predeceased children (who shared the
predeceased child's one-tenth interest).
The complications in this case began in 1964, when one of
Felix's children, James Freeman ("James"), purported to deed
all the property to another child of Felix's, Joseph Freeman
("Joseph"). The 1964 deed was duly recorded. Nothing in the
record establishes that, before that deed was executed, James
owned more than the one-tenth interest in the property he had
inherited from Felix in 1961. The 1964 deed from James to
Joseph began a series of conveyances involving various parties
over several years. That line of conveyances ended with two
2
1160268
deeds in 2004, when DRL, LLC, purported to convey one-half of
the surface estate of the property to Thomas W. Hinote and
Cindy S. Hinote and one-half of the surface estate of the
property to David H. Dowdy and Rebecca L. Dowdy. DRL also
purported to convey a portion of the mineral rights in the
property to the Hinotes and the Dowdys; DRL retained a portion
of the mineral rights for itself. However, for the sake of
simplicity, we will describe the competing claims to the
property only as they relate to the surface estate, as to
which, for purposes of this appeal, the mineral estate is
similarly situated.
The various transactions created a situation with two
sides laying claim to the property. On the one hand, Felix's
descendants claim to own various fractional parts of the
property as cotenants. They claim that James never owned more
than the one-tenth interest in the property he inherited on
Felix's death and, thus, that he could not have conveyed more
than that one-tenth interest to Joseph in 1964. They contend
that, after the 1964 deed, Joseph owned only a two-tenths
interest in the property (the one-tenth interest he inherited
on Felix's death plus the one-tenth interest he acquired from
3
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James). Under their view, the Hinotes and the Dowdys would
also be cotenants, each having actually acquired a one-tenth
interest instead of the one-half interest they thought they
had acquired. The Hinotes and the Dowdys, on the other hand,
each claim to own one-half of the property, tracing their
titles back to the 1964 deed in which James purported to deed
all the property to Joseph.
In 2011, four of Felix's descendants, Annette Freeman
Owens, Willie Freeman, Jr., Eva N. Freeman Jones, and Nona
Freeman Farrior, sued the Hinotes and the Dowdys.1 In
pertinent part, the plaintiffs sought a judgment determining
the ownership of the property, and they requested a sale of
the property for a division of the proceeds. The Hinotes and
the Dowdys primarily argued that the plaintiffs' action is
barred by the 20-year rule of repose; the plaintiffs dispute
that their action is barred by the rule of repose. The
1The plaintiffs also sued, as necessary parties, many
Freeman relatives who allegedly held interests in the
property. Concerning the issue on appeal, the interests of
those additional defendants are actually aligned with the
interests of the plaintiffs. Thus, the additional defendants
were listed as appellees in the notice of appeal. However,
the additional defendants did not file appellate briefs and
have not actively participated in this appeal.
4
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Hinotes and the Dowdys alternatively argued that they had
acquired the property by adverse possession, contending that
they and their predecessors had been in actual, hostile, open,
notorious, and exclusive possession of the property for many
years.
Following a trial, the trial court entered a judgment in
favor of the plaintiffs. The trial court concluded that the
plaintiffs owned the property as cotenants, along with the
Hinotes, the Dowdys, and dozens of other descendants of Felix.
That is, the court determined that the Hinotes and the Dowdys
had each acquired a one-tenth interest in the property instead
of the one-half interest their respective deeds indicate. The
trial court further ordered that the property be sold and the
proceeds divided according to the property interest held. The
trial court did not discuss the rule of repose in its
judgment. The Hinotes and the Dowdys appealed. We affirm.
On appeal, the Hinotes and the Dowdys argue that
Alabama's common-law rule of repose bars this action. In Ex
parte Liberty National Life Insurance Co., 825 So. 2d 758
(Ala. 2002), this Court clarified the law concerning the rule
of repose. In that case, we explained that the rule of repose
5
1160268
bars an action not brought within 20 years from the time the
action could have been brought. 825 So. 2d at 764. The rule
is based solely on the passage of time. Id. This concept is
distinct from the accrual of a claim for purposes of a statute
of limitations: "[R]epose does not depend on 'accrual,'
because the concept of accrual sometimes incorporates other
factors, such as notice, knowledge, or discovery." 825 So. 2d
at 764 n.2. However, in some cases the start of the 20-year
period of repose will coincide with the accrual of a claim.
Unlike a
statute of limitations, which extinguishes the remedy
rather than the right, the rule of repose extinguishes both
the remedy and the action itself. 825 So. 2d at 765. The
rule is based on the ideas that "'[i]t is necessary for the
peace and security of society'" that disputes should end at
some point and that "'it is inequitable to allow those who
have slept upon their rights for a period of 20 years'" to
bring an action after memories have faded and parties and
witnesses have passed away. 825 So. 2d at 763 (quoting
Snodgrass v. Snodgrass, 176 Ala. 276, 280, 58 So. 201, 202
(1912)). "'[T]he only circumstance that will stay the running
of the 20 year period of repose is a recognition of the
6
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existence of the claimant's right by the party defending
against the claim.'" 825 So. 2d at 765 (quoting Boshell v.
Keith, 418 So. 2d 89, 92 (Ala. 1982) (emphasis omitted)).
That recognition must be express and explicit. 825 So. 2d at
765.
The Hinotes and the Dowdys trace their titles to the 1964
deed by which James purported to convey all the property to
Joseph. They contend that "[a] claim existed and a right
could have been asserted as early as 1964 when James ...
purported to convey the full interest –– not just his interest
–– in the [property] to Joseph." The Hinotes and the Dowdys'
brief, at 16. Thus, the Hinotes and the Dowdys argue that a
20-year period of repose began to run at that point in 1964.
Therefore, they argue, the 20-year period expired long before
the plaintiffs filed their action in 2011 and, thus, the
action is barred. However, the rule of repose simply does not
apply in this case.
Initially, we emphasize the fundamental principle that
one cannot convey more property that one owns. Simmons Grp.,
LTD v. O'Rear, [Ms. 1150475, March 24, 2017] ___ So. 3d ___,
___ (Ala. 2017) (stating "the basic property rule that a
7
1160268
grantor cannot convey more than the grantor actually owns").
In 1964, James purported to convey all the property to Joseph
by deed. However, nothing in the record establishes that,
when that deed was executed, James owned more than the one-
tenth interest in the property he had inherited in 1961. The
record indicates that James was a cotenant of the property
with Felix's other heirs. The Hinotes and the Dowdys
acknowledge as much in their brief by noting that "one
cotenant[, James,] attempted to convey all of the [property]"
and that, in the 1964 deed, "James ... purported to convey the
full interest –– not just his interest –– in the [property] to
Joseph." The Hinotes and the Dowdys' brief, at 14 and 16
(emphasis in original).
Given that James attempted in the 1964 deed to convey
more than he owned and that the Hinotes and the Dowdys claim
through that deed, it is evident that the plaintiffs, who
claim through intestate succession from Felix, have superior
title to the Hinotes and the Dowdys. Once superior title has
been established, there is a limited manner by which another
party may wrest away that title. In this case, the Hinotes
and the Dowdys attempt to use the rule of repose to divest
8
1160268
title from the other cotenants; however, the rule may not be
used in that way. "The rule of repose has been described as
the 'running of the period against claims' rather than a
device to displace title. ... [T]he rule of repose cannot be
used against one with valid record title by one who clearly
does not have title." Oehmig v. Johnson, 638 So. 2d 846, 850
(Ala. 1994) (quoting Boshell, 418 So. 2d at 92 (emphasis in
Boshell omitted)), overruled on other grounds by Ex parte
Liberty National, supra. In a case like this, the method of
divesting title from other cotenants would be to establish
adverse possession.
Knouff v. Knouff, 485 So. 2d 1155 (Ala. 1986),
illustrates that point. In the proceedings below and on
appeal there has been some discussion about whether and how
Knouff relates to Ex parte Liberty National, which clarified
the law on the rule of repose 16 years after the opinion in
Knouff was issued. We take this opportunity to address that
issue. Like this case, Knouff involved several heirs who
inherited land intestate and thus became cotenants. After
taxes were not paid on the land, one of the cotenants, S.S.
Knouff, purchased the land at a tax sale. S.S. received a tax
9
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deed to the land in his own name. More than 20 years later,
certain heirs, claiming they still owned the land as
cotenants, sought a sale for division. S.S.'s son and heir,
J.R. Knouff, then sought to quiet title to the land. J.R.
argued that the rule of repose barred the heirs' attempt to
have the trial court order a sale for division. This Court
disagreed, concluding that the rule of repose did not bar the
action.
The Court first observed that, although S.S. had bought
the land at a tax sale and had acquired a tax deed in his own
name, his doing so was deemed to be for the benefit of all the
cotenants. Thus, the tax deed had not actually given S.S.
exclusive ownership of the land. The Court then addressed
J.R.'s argument that he and his father S.S. had nevertheless
adversely possessed the land since the date of the tax deed.
The Court used "repose" language when discussing the adverse-
possession claim:
"There is a strong presumption in the law that the
possession of one co-tenant is the possession of
all, and possession by one tenant in common alone
does
not
repel
the
presumption.
Monte
v.
Montalbano, 274 Ala. 6, 145 So. 2d 197 (1962).
Neither do the payment of taxes and lapse of time.
...
10
1160268
"The reason for the presumption that possession
by one tenant in common is for the benefit of all
tenants in common is obvious. One co-tenant should
not be favored over another simply because the
latter makes no objection to the first co-tenant's
possessing and using the land they own in common.
If the one using common land intends to deprive his
co-tenant of his interest, he should have the burden
of bringing his evil intent to the attention of his
co-tenant. It is only after actual knowledge of the
fact that the possession is hostile and intended to
oust the co-tenant and defeat his common interest
that the rule of repose begins to run against the
co-tenant. One cannot be said to have slept on his
rights unless it has been brought home to him that
his rights have been invaded."
Knouff, 485 So. 2d at 1156 (emphasis added).
Knouff concerns how one cotenant might wrest title from
another cotenant. In that context, the Court used the term
"rule of repose" to describe adverse possession. The "rule of
repose" discussed in Knouff is not the rule of repose
discussed 16 years later in Ex parte Liberty National, which
clarified the rule. The rule of repose, as discussed in Ex
parte Liberty National, is based solely on the passage of
time. However, the "rule of repose" discussed in Knouff is
actually adverse possession, which of course involves more
elements than the mere passage of time. Ex parte Liberty
National did not discuss Knouff, which is not surprising,
given that the cases discuss distinct concepts. The rule of
11
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repose discussed in Ex parte Liberty National is "a defensive
matter"
and
"is
unlike
adverse
possession, which
affirmatively
establishes title." Boshell, 418 So. 2d at 92. However,
although repose and adverse possession are distinct, they are
related and come from the same legal root; thus, it is not
surprising that "repose" language will sometimes appear in
adverse-possession cases. Both the rule of repose and adverse
possession are based on the idea that unasserted rights may be
extinguished under certain conditions. With the rule of
repose, the only requirement is the passage of time; adverse
possession requires the passage of time plus all the other
requirements of adverse possession. In short, adverse
possession is a rule of repose in that it puts to rest a
property claim, but it is not the rule of repose discussed in
Ex parte Liberty National. See, e.g., Sparks v. Byrd, 562 So.
2d 211, 214 (Ala. 1990) ("In Alabama, the common-law doctrine
of adverse possession by prescription acts as a rule of
absolute repose ...."); Snow v. Boykin, 432 So. 2d 1210, 1212
(Ala. 1983) (stating that the common-law doctrine of adverse
possession by "prescription of twenty years is a rule of
absolute repose"); and Fitts v. Alexander, 277 Ala. 372, 376,
12
1160268
170 So. 2d 808, 811 (1965) (stating that the 20-year
prescriptive period for adverse possession "operates as an
absolute rule of repose"); see also Herrick v. Moore, 185 Iowa
828, 169 N.W. 741, 742 (1918) ("[A]dverse possession is in the
nature of a rule of repose.").
Knouff illustrates that adverse possession is the method
of "repose" one cotenant may use to displace title from
another cotenant. Ex parte Walker, 739 So. 2d 3 (Ala. 1999),
further illustrates this point. In Ex parte Walker, one
cotenant, Cox, argued that he had acquired all of a tract of
land from his other cotenants by adverse possession. The case
was a straightforward adverse-possession case concerning
cotenants. The Court, in concluding that Cox had not
established adverse possession, quoted and relied on Knouff.
Specifically, the Court quoted that part of Knouff, also
quoted above, concluding that "'[i]t is only after actual
knowledge of the fact that the possession is hostile and
intended to oust the co-tenant and defeat his common interest
that the rule of repose begins to run against the co-tenant.'"
Ex parte Walker, 739 So. 2d at 7 (quoting Knouff, 485 So. 2d
at 1156). It is evident that the "rule of repose" discussed
13
1160268
in Ex parte Walker, like the "rule of repose" discussed in
Knouff, is actually adverse possession.
We need not discuss whether the Hinotes and the Dowdys
obtained the property by adverse possession because they have
not presented and argued that issue.2 Their appeal rises or
falls on their argument that the rule of repose bars the
plaintiffs' action. We conclude that the rule of repose is
inapplicable in this case and thus does not bar the
plaintiffs' action. Accordingly, we affirm the trial court's
judgment in favor of the plaintiffs.
AFFIRMED.
Stuart, C.J., and Bolin, Parker, Shaw, Main, and Wise,
JJ., concur.
Murdock, J., concurs specially.
Sellers, J., dissents.
2For a summary of the law concerning adverse possession
as it relates to cotenants, see Horne v. Ward, 585 So. 2d 877,
878 (Ala. 1991).
14
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MURDOCK, Justice (concurring specially).
I fully agree with the well considered analysis of the
main opinion. I write separately to offer a few additional
thoughts.
The law begins with this fundamental principle, well
explained by the main opinion: One cannot convey better title
than one owns. And an application of the rule of repose in
the same "space" as this fundamental principle would
eviscerate this principle. It would mean that, in fact, a
person could be conveyed a better title by his grantor than
was held by his grantor so long as no one files an action
challenging that conveyance, e.g., a quiet-title action, for
20 years.
Applying a bare, 20-year rule of repose in the manner
suggested by the appellants (i.e., merely because a grantee
records his deed) would prevent not only the holder under an
older, superior chain from defending or suing to vindicate his
title once another grantee's deed had been on record for 20
years, but also would prevent the holder under the younger,
inferior chain from invoking judicial assistance to defend or
vindicate that holder's claim to the land because, typically,
15
1160268
the older, superior chain of title also is of record and
therefore would have been on record even longer than the
challenger's chain. That is, the appellants' approach would
mean that when two competing, recorded chains of title are
both at least 20 years old, neither side could obtain judicial
relief to clarify ownership of land. I suppose self-help
would be the only remedy at that point.
Temporal limitations imposed by our law -- statutes of
limitations and rules of repose -- are apposite in civil
claims of wrong committed by one party against another. If
there is no recovery in such an action because of those
limitations, then there is no recovery. So be it.
But disputes over ownership of land are different. The
purpose of a quiet-title action is not to allow the law to
take the measure of a wrong by one party against another.
There is no actionable "wrong" by either party, except for the
"cloud" that both parties cast on the title of the other.
Moreover, where two parties each lay claim to ownership of the
same land, there must be a recovery. Unlike a civil action
that measures a claimed wrong by one party against another,
the action cannot end without a recovery. One of the parties
16
1160268
must come away with an award of title to the land. A rule of
repose is inapposite.
The main opinion also well states a corollary to the
principle that one cannot convey more than he actually owns,
namely that the superior chain of title governs the question
of land ownership, unless a third party is able to "wrest"
that title away from the proper title holder. And to give
full vitality to this principle, the law has always required
something more to wrest ownership from the rightful owner than
a claim under an otherwise invalid conveyance, even if
recorded, followed by a period of inaction and waiting. That
"more" -- that has developed over hundreds of years in our
common law (and is now codified in some measure) -- are the
additional elements of adverse or prescriptive possession,
i.e., (i) actual and exclusive possession that is (ii) open,
(iii) hostile, (iii) notorious, and (iv) continuous.
The "more" is not the recording of a deed. In fact, the
cases where the law has required the challenger to meet the
adverse-possession
elements
under
statutory
adverse
possession
(10 years) or common-law prescription (20 years), are not
affected by whether the challenger's deed is recorded.
17
1160268
Application of the contrary notion would mean (i) that the
legal theories of adverse possession and prescription are in
large measure rendered unnecessary and (ii) that everyone who
receives valid title to land must go to the courthouse and
check that title every 20 years for any recordation of a
competing deed, else risk losing title to the land to an
otherwise stealth owner who takes no other action to put the
rightful owner on notice of his adverse claim to the land.
That, of course, is not required. See Oehmig v. Johnson, 638
So. 2d 846 (Ala. 1994).3
3Ex parte Liberty National Life Insurance Co., 825 So. 2d
758 (Ala. 2002) is inapposite. It did not involve challenges
to ownership of real property but, instead, involved an action
against a life insurer to recover for use of race-distinct
mortality rates in industrial insurance policies.
18
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SELLERS, Justice (dissenting).
I respectfully dissent.
In Oehmig v. Johnson, 638 So. 2d 846 (Ala. 1994), the
purported grantee of real property in fee simple sought to
quiet title as against the purported owners of the mineral
rights in the property. In discussing the rule of repose,
which the grantee had asserted in support of his quiet-title
action, this Court said:
"The rule of repose is 'a defensive matter' and 'is
unlike adverse possession, which affirmatively
establishes title.' Boshell v. Keith, 418 So. 2d 89,
92 (Ala. 1982). The rule of repose has been
described as the 'running of the period against
claims' rather than a device to displace title. Id.
(Emphasis in original.) We hold that the rule of
repose cannot be used against one with valid record
title by one who clearly does not have title.
"... It was not the responsibility of the
[purported owners of the mineral
rights] to
continually check the title records to see if
someone had purported to convey their mineral
interests. The time for the rule of repose cannot
run until there is at least constructive notice of
a potential claim. ..."
638 So. 2d at 850-51.
Oehmig, however, was criticized in Ex parte Liberty
National Life Insurance Co., 825 So. 2d 758 (Ala. 2002). In
that case, this Court indicated that Oehmig was incorrect in
19
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suggesting that the rule of repose cannot start to run until
there has been "notice" of the claim at issue. 825 So. 2d at
764 n.3. The Court, however, did not criticize Oehmig for
indicating that the rule of repose cannot "be used offensively
(in a manner similar to the concept of adverse possession)
'against one with valid record title by one who clearly does
not have title' in order to divest the title owner of
property." Id. (quoting Oehmig, 638 So. 2d at 850).
In Harrison v. Alabama Forever Wild Land Trust, 4 So. 3d
1114 (Ala. 2008), however, this Court held that the rule of
repose applied in a quiet-title action, which was commenced by
a plaintiff claiming to own a parcel of real property more
than 20 years after the recording of a deed that, if valid,
would defeat the plaintiff's claim to ownership. The property
at issue in Harrison was originally granted to Greenberry
Williams, Sr., by the United States government in 1848. In
1856, Greenberry Williams, Sr., conveyed the property to one
of his sons, Ausker. In 1907, a deed was recorded by which
Ausker's brother, Greenberry Williams, Jr., purported to
convey the property to J.T. Crotts and P.B. Worley. There
was, however, no deed whereby the property had been conveyed
20
1160268
to Greenberry Williams, Jr. The plaintiff in Harrison
disputed the validity of the 1907 deed from Greenberry
Williams, Jr., to Crotts and Worley, suggesting that it was a
"forgery." 4 So. 3d at 1116-18. He claimed that the property
actually had "passed down through the Ausker Williams family
pursuant to the 1856 deed by which Greenberry Williams, Sr.,
conveyed the property to Ausker Williams." 4 So. 3d at 1116.
After the 1907 deed to Crotts and Worley was recorded,
multiple additional deeds, which purported to convey the
property to various grantees, were executed and recorded. In
2002, the property was conveyed to the Alabama Forever Wild
Land Trust ("the Trust Fund"), which was named as a defendant
in the quiet-title action.
The trial court in Harrison entered a judgment in favor
of the Trust Fund. On appeal, this Court held that the rule
of repose applied to the plaintiff's claim of ownership:
"The Trust
Fund claims ownership of
the
property
by way of the 1907 deed whereby Greenberry Williams,
Jr., transferred the property to Crotts and Worley.
That deed was properly recorded in Colbert County,
and [the plaintiff's] ancestors were accordingly on
notice as of that date that another party claimed an
interest in the property. See § 35-4-63, Ala. Code
1975 ('The recording in the proper office of any
conveyance of property or other instrument which may
be legally admitted to record operates as a notice
21
1160268
of the contents of such conveyance or instrument
without any acknowledgment or probate thereof as
required by law.'). Nevertheless, none of those
ancestors took any steps to contest the 1907 deed.
Rather, it was not until 2005 -- 98 years after the
1907 deed was recorded -- that [the plaintiff]
initiated the present action to quiet title to the
property. During those 98 years in which [the
plaintiff] and his ancestors 'slept upon their
rights' and took no action to quiet title to the
property, 'the memory of transactions ... faded and
parties and witnesses passed away.' Boshell [v.
Keith, 418 So. 2d 89, 91 (Ala. 1982)] (emphasis
omitted). Indeed, [the plaintiff] has raised the
possibility that the 1907 deed was a forgery;
however, the parties that might have personal
knowledge of the circumstances surrounding the
execution and filing of that deed have almost
certainly all passed away. These are precisely the
facts for which the rule of repose was fashioned,
and that rule accordingly serves as an absolute bar
to [the plaintiff's] action."
4 So. 3d at 1118 (footnote omitted).
Relying on the circumstances and the reasoning in
Harrison, I would conclude that, in 1964 when James recorded
a deed purporting to convey the entire 40-acre property to
Joseph in fee simple, the 20-year rule of repose began to run.
That recording put Felix's heirs on notice that "another party
claimed an interest in the property." Harrison, 4 So. 3d at
1118. The rule of repose creates finality by barring claims
after an established period. That finality is important
22
1160268
because memories fade and parties and witnesses pass away.
Id. (citing Boshell v. Keith, 418 So. 2d 89, 91 (Ala. 1982)).
I also note that the record indicates that, in 1980,
other family members were involved in conveyances with persons
in the relevant chain of title, who claimed to own the
property at issue. Thus, it appears that the appellees had
knowledge at that time of a dispute regarding ownership of the
property. The appellees, however, took no action until 2011.
We should not reward parties who sleep on their rights and
fail to take actions to protect their interests in real
property. The rule of repose prevents parties who here have
some 30 years' prior notice of a possible dispute as to
ownership from bringing suit to establish title.
Accordingly,
I would reverse the trial court's judgment.
23 | September 8, 2017 |
f84cf1ad-2065-4107-9161-967298e9acf0 | Ex parte Rennie D. Jackson. | N/A | 1160505 | Alabama | Alabama Supreme Court | Rel: 09/01/2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
SPECIAL TERM, 2017
____________________
1160504
____________________
Ex parte Midsouth Paving, Inc.
PETITION FOR WRIT OF MANDAMUS
(In re: Barbara M. Hodge, as administratrix of the Estate of
Katie-Elizabeth Hope Vann, and Sue Davis, as parent and next
friend of Valorie Eicher, a minor, Tristan Eicher, a minor,
and Cody Ballinger, a minor
v.
Rennie D. Jackson et al.)
____________________
1160505
____________________
Ex parte Rennie D. Jackson
PETITION FOR WRIT OF MANDAMUS
(In re: Barbara M. Hodge, as administratrix of the Estate of
Katie-Elizabeth Hope Vann, and Sue Davis, as parent and next
friend of Valorie Eicher, a minor, Tristan Eicher, a minor,
and Cody Ballinger, a minor
v.
Rennie D. Jackson et al.)
____________________
1160517
____________________
Ex parte United Services Automobile Association
PETITION FOR WRIT OF MANDAMUS
(In re: Barbara M. Hodge, as administratrix of the Estate of
Katie-Elizabeth Hope Vann, and Sue Davis, as parent and next
friend of Valorie Eicher, a minor, Tristan Eicher, a minor,
and Cody Ballinger, a minor
v.
Rennie D. Jackson et al.)
____________________
1160563
____________________
Ex parte Schaeffler Group USA, Inc., and Gelco Corporation
PETITION FOR WRIT OF MANDAMUS
(In re: Barbara M. Hodge, as administratrix of the Estate of
Katie-Elizabeth Hope Vann, and Sue Davis, as parent and next
friend of Valorie Eicher, a minor, Tristan Eicher, a minor,
and Cody Ballinger, a minor
2
v.
Rennie D. Jackson et al.)
(Hale Circuit Court, CV-16-900034)
PARKER, Justice.
Midsouth Paving, Inc. ("Midsouth"), Rennie D. Jackson,
United
Services
Automobile
Association
("USAA"),
and
Schaeffler
Group
USA,
Inc.
("Schaeffler"),
and
Gelco
Corporation
("Gelco")
(hereinafter
collectively
referred
to
as
"the defendants") separately petition this Court for writs of
mandamus directing the Hale Circuit Court to vacate its order
denying the defendants' motions for a change of venue and to
enter an order transferring the action filed against the
defendants by Barbara M. Hodge, as the administratrix of the
estate of Katie-Elizabeth Hope Vann, and Sue Davis, as parent
and next friend of Valorie Eicher, a minor, Tristan Eicher, a
minor, and Cody Ballinger, a minor (hereinafter collectively
referred to as "the plaintiffs"), to the Tuscaloosa Circuit
Court. We grant the petitions and issue the writs.
Facts and Procedural History
On December 6, 2015, Valorie Eicher, a resident of Hale
County, was driving a vehicle north on Interstate 59 through
Tuscaloosa
County.
Katie-Elizabeth Hope
Vann,
Tristan
Eicher,
3
1160504, 1160505, 1160517, 1160563
and Cody Ballinger, all also residents of Hale County, were
passengers in the vehicle Valorie was driving. Jackson, an
employee of Schaeffler and a resident of Tuscaloosa County,
was also driving a vehicle, owned by Gelco, north on
Interstate 59 in the lane next to the vehicle being driven by
Valorie. Jackson made an improper lane change, which forced
Valorie to drive her vehicle partially off the interstate.
Valorie lost control of her vehicle as she attempted to drive
the vehicle back onto the interstate. Ultimately, the vehicle
Valorie was driving overturned and rolled approximately two
and one-half times, ejecting all the occupants from the
vehicle. All the occupants in the vehicle driven by Valorie
sustained injuries; Vann died at the scene of the accident as
a result of the injuries she incurred. Deandra Bland, a
Mississippi resident, witnessed the accident.
Valorie, Tristan, and Ballinger were transported from the
scene of the accident to DCH Regional Medical Center, which is
located in Tuscaloosa County, by Northstar EMS, Inc.
("Northstar"), which has its principal place of business in
Tuscaloosa County. Bradley Bible, Susan Gault, and Tyler
Kelley, employees of Northstar, responded to the scene of the
4
1160504, 1160505, 1160517, 1160563
accident and helped in transporting Valorie, Tristan, and
Ballinger to DCH Regional Medical Center; all live and work in
Tuscaloosa County. Vann's body was transported to the Alabama
Department of Forensic Sciences' morgue, which is located in
Tuscaloosa County.
Orlander Marbury and Jason Vice, Alabama State Troopers
employed by the Alabama Law Enforcement Agency ("ALEA"), were
two of the officers who investigated the accident. Vice's
affidavit testimony indicates that he lives in Tuscaloosa
County. Marbury's and Vice's affidavits state that "[a]ll of
the State Troopers that investigated this accident are based
out of the ALEA Post located in Tuscaloosa County, Alabama."
Jamaine Isaac, a supervisor at the Tuscaloosa County ALEA
post, indicated in his affidavit testimony that the State
Troopers stationed at the Tuscaloosa County ALEA post "are
assigned to cover and investigate incidents and accidents in
several counties." The parties have not directed this Court's
attention to any evidence indicating that the State Troopers
stationed at the Tuscaloosa County ALEA post do any work in
Hale County.
5
1160504, 1160505, 1160517, 1160563
At the time of the accident, Midsouth was performing
construction work in an area on Interstate 59 in Tuscaloosa
County that encompassed the scene of the accident. Michael
Patterson and Bret Thornton are employed by Midsouth; they
were the managers of the Midsouth construction project in
Tuscaloosa County. Patterson resides in Tuscaloosa County.
Patterson's and Thornton's affidavits state that "[a]ll
physical evidence [they are] aware of relating to this
accident is located in Tuscaloosa County."
Midsouth, USAA, and Schaeffler also conducted business in
Hale County unrelated to the work Midsouth was conducting in
Tuscaloosa County at the scene of the accident.
On May 15, 2016, the plaintiffs sued the defendants in
the Hale Circuit Court. Subsequently, all the defendants
filed motions for a change of venue, arguing that the doctrine
of forum non conveniens necessitated the transfer of the case
from the Hale Circuit Court to the Tuscaloosa Circuit Court.
On September 20, 2016, the plaintiffs filed a response to the
defendants' motions for a change of venue.
6
1160504, 1160505, 1160517, 1160563
On February 22, 2017, the Hale Circuit Court entered the
following order denying the defendants' motions for a change
of venue:
"This matter comes before the court on the
various motions to transfer this case from the
Circuit Court of Hale County, Alabama, to the
Circuit Court of Tuscaloosa County, Alabama. No
party has raised or challenged the propriety of
venue in Hale County, and the court finds that Hale
County, Alabama, is a proper venue for this case.
The only issue raised for consideration within the
pending motions is a transfer of venue pursuant to
the doctrine of forum non conveniens.
"The ... defendants filed separate motions to
transfer venue on forum non conveniens grounds, and
the plaintiffs filed a consolidated response to
those motions on September 20, 2016. Defendant
Mid-South Paving filed a motion to strike addressing
various evidentiary submissions filed with the
plaintiffs’ response brief. The plaintiffs were
granted leave to respond to the motion to strike and
filed their response and accompanying submissions on
January 31, 2017. Upon consideration of those
written submissions, as well as the oral arguments
made to the court on the motions to transfer, the
court finds that the defendants did not establish
that
Tuscaloosa
County
is
significantly
more
convenient than Hale County for the litigation of
this case, nor have the defendants established that
the interests of justice warrant a transfer to
Tuscaloosa County. Accordingly, the court hereby
DENIES the defendants’ motions to transfer this
matter to Tuscaloosa County on the grounds of forum
non conveniens."
(Capitalization in orignal.)
Standard of Review
7
1160504, 1160505, 1160517, 1160563
"'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 [exceeded] 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).'"
Ex parte Southeast Alabama Timber Harvesting, LLC, 94 So. 3d
371, 373 (Ala. 2012) (quoting Ex parte National Sec. Ins. Co.,
727 So.2d 788, 789 (Ala. 1998)).
Discussion
The defendants argue that the Hale Circuit Court exceeded
its discretion in denying their motions for a change of venue.
The defendants argue that the action should be transferred to
the Tuscaloosa Circuit Court under Alabama's forum non
conveniens statute, § 6-3-21.1(a), Ala. Code 1975.
Section 6-3-21.1(a) states, in pertinent part:
8
1160504, 1160505, 1160517, 1160563
"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 and the case shall proceed
as though originally filed therein."
This Court explained the application of § 6-3-21.1(a) in Ex
parte Tier 1 Trucking, LLC, [Ms. 1150740, Sept. 30, 2016] ___
So. 3d ___, ___ (Ala. 2016):
"[C]oncerning
whether
an
action
should
be
transferred under § 6–3–21.1, this Court has stated:
"'"A party moving for a transfer under
§ 6–3–21.1 has the initial burden of
showing, among other things, one of two
factors: (1) that the transfer is justified
based on the convenience of either the
parties or the witnesses, or (2) that the
transfer is justified 'in the interest of
justice.'" Ex parte Indiana Mills & Mfg.,
Inc., 10 So. 3d 536, 539 (Ala. 2008).
Although we review a ruling on a motion to
transfer to determine whether the trial
court exceeded its discretion in granting
or denying the motion, id., where "the
convenience of the parties and witnesses or
the interest of justice would be best
served by a transfer, § 6–3–21.1, Ala. Code
1975, compels the trial court to transfer
the action to the alternative forum." Ex
parte First Tennessee Bank Nat'l Ass'n, 994
So. 2d 906, 912 (Ala. 2008) (emphasis
added).'
"Ex parte Wachovia Bank, N.A., 77 So. 3d 570, 573
(Ala. 2011).
9
1160504, 1160505, 1160517, 1160563
"'"The purpose of the doctrine of
forum non conveniens is to 'prevent the
waste of time, energy, and money and also
to protect witnesses, litigants, and the
public against unnecessary expense and
inconvenience.'"
Ex
parte
Perfection
Siding, Inc., 882 So. 2d 307, 312 (Ala.
2003) (quoting Ex parte New England Mut.
Life Ins. Co., 663 So. 2d 952, 956 (Ala.
1995)). We note that "litigation should be
handled in the forum where the injury
occurred" and that "one of the fundamental
purposes of the doctrine of forum non
conveniens is to spare witnesses the
unnecessary inconvenience associated with
testifying in a distant forum." Ex parte
Sawyer, 892 So. 2d 898, 904 (Ala. 2004).'
"Ex parte Kane, 989 So. 2d 509, 512 (Ala. 2008).
"'"The 'interest of justice'
prong of § 6–3–21.1 requires '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.' Ex parte National
Sec. Ins. Co., 727 So. 2d [788,]
790 [(Ala. 1998)]. Therefore, 'in
analyzing
the
interest-of-justice
prong of § 6–3–21.1, this Court
focuses on whether the "nexus" or
"connection"
between
the
plaintiff's
action
and
the
original forum is strong enough
to
warrant
burdening
the
plaintiff's
forum
with
the
action.' Ex parte First Tennessee
Bank Nat'l Ass'n, 994 So. 2d 906,
911 (Ala. 2008). Additionally,
this
Court
has
held
that
'litigation should be handled in
10
1160504, 1160505, 1160517, 1160563
the
forum
where
the
injury
occurred.' Ex parte Fuller, 955
So. 2d 414, 416 (Ala. 2006).
Further, in examining whether it
is in the interest of justice to
transfer a case, we consider 'the
burden of piling court services
and resources upon the people of
a county that is not affected by
the case and ... the interest of
the people of a county to have a
case that arises in their county
tried close to public view in
their county.' Ex parte Smiths
Water & Sewer Auth., 982 So. 2d
484, 490 (Ala. 2007)."'
"Ex parte Quality Carriers, Inc., 183 So. 3d 937,
942 (Ala. 2015) (quoting Ex parte Indiana Mills &
Mfg., Inc., 10 So. 3d 536, 540 (Ala. 2008)).
"'Although it is not a talisman, the fact
that the injury occurred in the proposed
transferee
county
is
often
assigned
c o n s i d e r a b l e
w e i g h t
i n
a n
interest-of-justice analysis. See Ex parte
Autauga Heating & Cooling, LLC, 58 So. 3d
745, 748 (Ala. 2010) ("'[T]his Court has
held that "litigation should be handled in
the forum where the injury occurred."'"
(quoting Ex parte Indiana Mills, 10 So. 3d
at 540)); Ex parte McKenzie Oil, Inc., 13
So. 3d 346, 349 (Ala. 2008) (same).'
"Ex parte Wachovia, 77 So. 3d at 573–74."
The defendants argue that this action should be
transferred under either the convenience or the interest-of-
justice prong of § 6–3–21.1. However, the defendants' primary
11
1160504, 1160505, 1160517, 1160563
argument is that the interest-of-justice prong of § 6–3–21.1
necessitates the transfer of this case from the Hale Circuit
Court to the Tuscaloosa Circuit Court. In so arguing, the
defendants rely primarily upon Ex parte Tier 1, supra.
The facts considered by this Court in Ex parte Tier 1 are
remarkably similar to those presented in the present case. In
Ex parte Tier 1, a vehicle driven by Jimmy Lee Mixon, a
resident of Wilcox County, collided with a tractor-trailer
owned by Tier 1 Trucking, LLC ("Tier 1"), and driven by a Tier
1 employee, who was a resident of Conecuh County; the accident
occurred in Conecuh County. Mixon was transported by a
company located in Conecuh County to a medical facility
located in Conecuh County to receive medical treatment for the
injuries he sustained in the accident. The accident was
investigated by a local law-enforcement agency located in
Conecuh County. Tier 1 conducted some business in Wilcox
County, but its principal office was located in Florida.
Mixon and his wife sued Tier 1 and its employee in the
Wilcox Circuit Court. Tier 1 and the employee filed a motion
to transfer the action from the Wilcox Circuit Court to the
Conecuh Circuit Court under § 6-3-21.1(a). The Wilcox Circuit
12
1160504, 1160505, 1160517, 1160563
Court denied the motion to transfer. Tier 1 and the employee
then petitioned this Court for a writ of mandamus directing
the Wilcox Circuit Court to vacate its order denying the
motion for a change of venue and to enter an order
transferring the action to the Conecuh Circuit Court.
In granting Tier 1 and the employee's petition and
issuing the requested writ, this Court provided the following
commentary on Alabama law pertaining to the interest-of-
justice prong:
"On multiple occasions, this Court has found
that a venue where the accident occurred, where a
party resides, and where other witnesses reside has
a much stronger connection to the action than a
venue where the only connection with the action is
that a party resides there and a defendant does some
business there. See, e.g., Ex parte Kane, 989 So. 2d
509, 513 (Ala. 2008) (requiring transfer of a
personal-injury action for 'both the convenience of
the parties and witnesses and the interest of
justice' from a venue where the plaintiff resided
and where the defendant automobile-liability insurer
had done some business to a venue where the accident
occurred and where the alleged tortfeasor, the
investigating officer, and all the other witnesses
that had been identified resided); Ex parte Wayne
Farms, LLC, 210 So. 3d 586 (Ala. 2016) (holding that
the interest of justice required transfer of a
personal-injury action from a venue where an
individual defendant resided and where the corporate
defendant did some business to a venue where the
accident occurred, where the plaintiffs resided,
where most of the emergency personnel who responded
to accident were located, where one plaintiff
13
1160504, 1160505, 1160517, 1160563
received
medical
treatment,
and
where
all
interactions and business transactions between the
corporate defendant and the plaintiffs occurred); Ex
parte Autauga Heating & Cooling, LLC, 58 So. 3d 745
(Ala. 2010) (holding that the interest of justice
required transfer of a personal-injury action from
a venue where one of the defendants resided and
where the corporate defendant 'may have some
business connections' to a venue where the accident
occurred, where the plaintiff resided, and where the
emergency medical technician who responded to the
accident resided).
"On one occasion, in Ex parte J & W Enterprises,
150 So. 3d 190 (Ala. 2014), this Court held that,
under the specific facts of that case, the
interest-of-justice
prong
of
the
forum
non
conveniens statute did not warrant transfer to the
venue where the accident occurred. However, in that
particular case, unlike in the present case, none of
the parties lived in the venue where the accident
occurred, the injured plaintiff did not receive
medical treatment in that venue, and no eyewitnesses
were located in that venue. Furthermore, both
defendants were located in the venue where the
action was filed, and the plaintiff resided outside
Alabama."
Ex parte Tier 1, ___ So. 3d at ___. This Court then provided
the following analysis of the facts before it:
"In the present case, the only connections to
Wilcox County are that [Mixon and his wife] reside
there and that Tier 1 has conducted some business
there that was not related to this action. The
undisputed facts show that the accident occurred in
Conecuh County, that one of the defendants resides
in
Conecuh
County,
and
that
law-enforcement
personnel in Conecuh County carried out the
investigation of the accident. Furthermore, there is
evidence indicating that [Mixon] received medical
14
1160504, 1160505, 1160517, 1160563
treatment in Conecuh County. Under our prior
decisions construing § 6–3–21.1, this Court gives
great weight to the fact that the accident occurred
in Conecuh County and to the fact that no material
events occurred in Wilcox County. Further, other
than [Mixon and his wife], no potential witnesses
who reside in Wilcox County have been identified.
... Also, although the affidavit of the police
officer who investigated the accident stated that it
would not be inconvenient for him to travel to
Wilcox County, he is employed by a local police
department located in Conecuh County that is tasked
with serving the people of Conecuh County, and his
investigation occurred in Conecuh County."
___ So. 3d at ___. Based on the above analysis, this Court
concluded:
"There is no reason to burden the people of Wilcox
County with the use of their court services and
other resources for a case that predominately
affects another county, and we recognize the
interest of the people of Conecuh County to have a
case that arose in their county tried close to
public view in their county. Wilcox County, with its
weak connection to the case, should not be burdened
with an action that arose in Conecuh County, with
its strong connection to the case, simply because
the plaintiffs reside in Wilcox County and the
corporate defendant has done some business there.
See Ex parte Autauga Heating & Cooling, 58 So. 3d at
750 (stating that '[t]his Court sees no need to
burden Montgomery County, with its weak connection
to the case, with an action that arose in Elmore
County simply because the individual defendant
resides in Montgomery County and the corporate
defendant does some business there'). Therefore,
under § 6–3–21.1, the trial court is compelled to
transfer the case to Conecuh County. See, e.g., Ex
parte Wachovia, 77 So. 3d at 573."
15
1160504, 1160505, 1160517, 1160563
___ So. 3d at ___.
The present case presents a similar factual scenario to
the one presented in Ex parte Tier 1. Tuscaloosa County has
a strong connection to this case. Most significantly, the
accident, which resulted in Vann's death and injuries to
Valorie, Tristan, and Ballinger, occurred in Tuscaloosa
County. Vann's body was transported to a morgue located in
Tuscaloosa County. Valorie, Tristan, and Ballinger received
medical care in Tuscaloosa County for injuries sustained in
the accident. The parties have not directed this Court's
attention to any evidence indicating that Valorie, Tristan, or
Ballinger received medical treatment in Hale County. The
Northstar medical workers who transported Valorie, Tristan,
and Ballinger from the scene of the accident to DCH Regional
Medical Center all live and work in Tuscaloosa County.
Northstar has its principal place of business in Tuscaloosa
County.1 Although the officers who investigated the scene of
1We
note
that
the
plaintiffs argue
that
"Tuscaloosa County
did not employ or pay for the services and resources provided
by" Northstar. The plaintiffs' assertion is based solely on
the fact that Northstar is a private company. Nevertheless,
the plaintiffs have not directed this Court's attention to any
evidence
supporting
their
assertion
that
Tuscaloosa County
did
not pay Northstar for its services.
16
1160504, 1160505, 1160517, 1160563
the accident are employed by ALEA, a State agency, they are
stationed at an ALEA post located in Tuscaloosa County. One
of the investigating officers resides in Tuscaloosa County;
the parties have not directed this Court's attention to any
evidence indicating that any of the investigating officers
reside in Hale County. Although some of the defendants have
conducted business in Hale County, that business is unrelated
to the facts of this case. One of Midsouth's managers over
the Midsouth construction project that encompassed the scene
of the accident resides in Tuscaloosa County and works in
Tuscaloosa County daily.
Hale County has a weak connection to this case. Its only
connections to this case are that the plaintiffs reside in
Hale County and that some of the defendants have done business
there unrelated to this case.
As stated in Ex parte Tier 1:
"There is no reason to burden the people of [Hale]
County with the use of their court services and
other resources for a case that predominately
affects another county, and we recognize the
interest of the people of [Tuscaloosa] County to
have a case that arose in their county tried close
to public view in their county. [Hale] County, with
its weak connection to the case, should not be
burdened with an action that arose in [Tuscaloosa]
County, with its strong connection to the case,
17
1160504, 1160505, 1160517, 1160563
simply because the plaintiffs reside in [Hale]
County and [some of] the ... defendant[s] ha[ve]
done some business there."
___ So. 3d at ___. Accordingly, based on the reasoning and
authorities set forth in Ex parte Tier 1, under § 6–3–21.1,
the Hale Circuit Court is compelled to transfer the case to
the Tuscaloosa Circuit Court.
We note that the plaintiffs argue that Ex parte First
Family Financial Services, Inc., 718 So. 2d 658 (Ala. 1998),
prevents the Hale Circuit Court from transferring the case to
the Tuscaloosa Circuit Court. The portion of Ex parte First
Family relied upon by the plaintiffs states: "'[W]hen the
trial judge determines that a plaintiff is guilty of "forum
shopping" and that the chosen forum is inappropriate because
of
considerations affecting the
court's
own
administrative and
legal problems, the statute provides that the trial court
"shall" transfer the cause.'" 718 So. 2d at 660 (quoting Ex
parte Gauntt, 677 So. 2d 204, 221 (Ala. 1996) (Maddox, J.,
dissenting)). The plaintiffs appear to argue that, in order
to have the case transferred under the interest-of-justice
prong, the defendants are required to demonstrate that the
plaintiffs had engaged in forum shopping and "that litigation
18
1160504, 1160505, 1160517, 1160563
of this matter in Hale County would inappropriately or
adversely affect Hale County's legal or administrative
process." The plaintiffs argue that the defendants failed to
demonstrate either.
However, in Ex parte First Tennessee Bank National Ass'n,
994 So. 2d 906, 911 (Ala. 2008), this Court discounted the
notion that a trial court's use of the interest-of-justice
prong under § 6-3-21.1 first requires a finding that the
plaintiff engaged in forum shopping. This Court stated:
"[N]othing in [Ex parte] First Family [Financial
Services, Inc., 718 So. 2d 658 (Ala. 1998),] limits
a trial court's use of the interest-of-justice prong
under § 6–3–21.1, Ala. Code 1975, to instances in
which the trial court determines that a plaintiff
has engaged in forum shopping. Instead, it appears
from
our
caselaw
that
in
analyzing
the
interest-of-justice prong of § 6–3–21.1, this Court
focuses on whether the 'nexus' or 'connection'
between the plaintiff's action and the original
forum is strong enough to warrant burdening the
plaintiff's forum with the action. See Ex parte
Kane, 989 So. 2d [509,] 512 [(Ala. 2008)] ('"[T]he
'interest of justice' require[s] 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."' (quoting [Ex parte]
National Sec. Ins. Co., 727 So. 2d [788,] 790 [(Ala.
1998)])). See also Ex parte Independent Life &
Accident Ins. Co., 725 So. 2d 955, 957 (Ala. 1998)
('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.'). In this case, [the
19
1160504, 1160505, 1160517, 1160563
defendant] moved the Jefferson Circuit Court to
transfer the action under § 6–3–21.1 on the basis
that the interest of justice warranted the transfer;
thus, the court rightly applied the 'nexus' or
'connection' analysis."
As did the Court in Ex parte First Tennessee Bank, we
have applied the nexus or connection analysis and determined
that the Hale Circuit Court exceeded its discretion in denying
the defendants' request to transfer the action to the
Tuscaloosa Circuit Court. The plaintiffs' argument that the
defendants must demonstrate that the plaintiffs engaged in
forum shopping and that litigation of this matter in the Hale
Circuit Court would inappropriately or adversely affect the
Hale Circuit Court's legal or administrative process is
without merit.
Lastly, we note that the defendants also argue that the
transfer of this case from the Hale Circuit Court to the
Tuscaloosa Circuit Court is justified based on
the
convenience
of the parties and the witnesses. We pretermit discussion of
that argument based on our conclusion that the transfer is
required under the interest-of-justice prong of § 6-3-21.1.
Conclusion
20
1160504, 1160505, 1160517, 1160563
The defendants have demonstrated a clear legal right to
writs of mandamus directing the Hale Circuit Court to vacate
its order denying the defendants' motions for a change of
venue and to enter an order transferring this action to the
Tuscaloosa Circuit Court.
1160504 -- PETITION GRANTED; WRIT ISSUED.
1160505 -- PETITION GRANTED; WRIT ISSUED.
1160517 -- PETITION GRANTED; WRIT ISSUED.
1160563 -- PETITION GRANTED; WRIT ISSUED.
Stuart, C.J., and Bolin, Shaw, Wise, and Bryan, JJ.,
concur.
Main and Sellers, JJ., concur in the result.
21 | September 1, 2017 |
286ddba2-5647-44f2-ae5b-6e83b7aa7b12 | Ex parte Alice Lynn Harper Taylor. | N/A | 1150236 | Alabama | Alabama Supreme Court | REL: October 13, 2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2017-2018
____________________
1150236
____________________
Ex parte Alice Lynn Harper Taylor
PETITION FOR WRIT OF MANDAMUS
(In re: William Charles Harper and James Robison Harper, Jr.
v.
Alice Lynn Harper Taylor)
(Monroe Probate Court, No. 3330)
MURDOCK, Justice.
Alice Lynn Harper Taylor ("Alice") petitions this Court
for a writ of mandamus directed to the Monroe Probate Court
1150236
requiring that court to enter orders (i) reinstating her
petition to probate a will allegedly executed by Alice Earle
Harper in 2007 ("the 2007 will"), (ii) reinstating her
petition contesting the 2007 will, and (iii) transferring her
contest of the 2007 will to the Monroe Circuit Court pursuant
to § 43-8-198, Ala. Code 1975. As hereinafter discussed, we
treat the petition as to the first two issues as a timely
filed direct appeal, and we reverse and remand. With respect
to the third issue, i.e., the transfer of the contest of the
2007 will to the Monroe Circuit Court, we grant the petition.
Facts and Procedural History
Alice Earle Harper, a resident of Monroe County, died on
March 1, 2013. She was survived by three adult children:
Alice, William Charles Harper ("William"), and James Robison
Harper, Jr.
On November 12, 2013, Alice filed in the Monroe Probate
Court a petition to probate a will allegedly executed by Alice
Earle Harper in 1995 ("the 1995 will"). In her petition to
probate the 1995 will, Alice acknowledged the existence of the
2007 will, but she asserted that the 2007 will was invalid
based on several grounds, including that Alice Earle Taylor
2
1150236
lacked the mental capacity to make the 2007 will because she
suffered from dementia and that the 2007 will was procured
through undue influence exerted by William. Alice attached a
copy of the 2007 will as an exhibit to her petition to probate
the 1995 will; the 2007 will purports to revoke all earlier
wills executed by Alice Earle Harper.
The Monroe Probate Court set Alice's petition to probate
the 1995 will for a hearing. As we noted in an earlier appeal
involving these parties, Taylor v. Estate of Harper, 164
So. 3d 542 (Ala. 2014)("Taylor I"):
"[O]n January 8, 2014, William filed a petition in
Escambia County to probate [the 2007 will]. On
January 17, 2014, in the Escambia Probate Court,
Alice filed a motion to dismiss and/or to stay the
proceeding in Escambia County until the proper venue
for the probate proceeding was determined. Alice
cited § 43-8-21, Ala. Code 1975, which addresses a
situation like this one where there are multiple
probate proceedings, and argued that under § 43-8-21
the Monroe Probate Court is the proper venue. On
February 19, 2014, the Escambia Probate Court
admitted the 2007 will to probate and issued letters
testamentary
to
William,
as
the
personal
representative named in the 2007 will. On March 3,
2014, Alice filed a notice of appeal pursuant to
§ 12-22-21(2), Ala. Code 1975, which allows an
appeal to the circuit court or to the Alabama
Supreme Court of a probate court's 'judgment or
order on an application claiming the right to
execute a will or administer an estate' (case no.
1130587).
3
1150236
"On April 11, 2014, William filed in the Monroe
Probate Court a motion to dismiss Alice's petition
to probate the 1995 will. William argued that the
2007 will revoked all earlier wills and that the
2007 will gave the personal representative the right
to choose the county in which the will would be
probated. On April 14, 2014, the Monroe Probate
Court granted William's motion to dismiss on the
ground that it lacked subject-matter jurisdiction.
Alice filed an appeal pursuant to § 12-22-21 from
the Monroe Probate Court's grant of the motion to
dismiss her petition to probate the 1995 will (case
no. 1130884).
164 So. 3d at 543-44.
In addressing Alice's arguments in Taylor I, this Court
stated:
"[T]he decedent died in Monroe County. Alice filed
a petition to probate the decedent's 1995 will in
Monroe County. It is undisputed that the decedent
was domiciled in Monroe County at the time of her
death. Section 43-8-162(1)[, Ala. Code 1975,]
provides that venue is proper in the probate court
where the decedent was an inhabitant at the time of
her death. This Court has equated the term
'inhabitant' with the word 'domiciliary,' and a
domicile consists of a residence at a particular
place accompanied by an intent to remain there
permanently or for an indefinite length of time.
Ambrose v. Vandeford, 277 Ala. 66, 167 So. 2d 149
(1964).
"Subsequently, William filed a petition to
probate the decedent's 2007 will in Escambia County.
The 2007 will provided that William, as the personal
representative, had the discretion to probate the
will in any county w[h]ere the decedent owned
property at the time of her death. It is undisputed
that the decedent owned property in Escambia County
4
1150236
at the time of her death. Section 43-8-162(5)[,
Ala. Code 1975,] provides that probate of a will is
proper in the county designated by the testator in
the will if the testator owns property in that
county at the time of her death.
"Alice
challenges the
validity of
the
2007 will;
William challenges the validity of the 1995 will.
Both challenges go to the merits of the case, i.e.,
whether either of the tendered wills is entitled to
be admitted to probate, and, if so, which one.
Simply because William has submitted a will with a
later date, which purports to revoke all prior
wills, does not mean that the 2007 will is valid,
nor does it mean that the Escambia Probate Court is
the proper venue. The legislature has provided for
the proper venue in probate matters when more than
one probate court has venue. That is what we have
before us in this case. The Monroe Probate Court is
the proper venue under § 43-8-162(1), and the
Escambia Probate Court is the proper venue under
§ 43-8-162(5). The legislature has determined that
when there are multiple venues for a probate
proceeding,
the
probate
court
in
which
the
proceeding was first commenced shall have the
exclusive right to proceed. § 43-8-21(a)[, Ala.
Code 1975)]. Section 43-8-21(b)[, Ala. Code 1975),]
provides that if multiple proceedings are commenced
in more than one probate court and those proceedings
involve the same estate, then the probate court
where the proceeding was first commenced shall hear
the matter, and the other court shall hold the
matter in abeyance until the question of venue is
decided.
"....
"Based on the foregoing, we hold that venue in
this case is proper in the Monroe Probate Court, by
virtue of § 43-8-162 and § 43-8-21. Any argument as
to whether the 1995 will or the 2007 will is the
valid last will and testament of the decedent and
5
1150236
entitled to admission to probate is a question on
the merits and has yet to be determined. We reverse
the judgment of the Escambia Probate Court admitting
the 2007 will to probate and appointing William as
a personal representative because, under § 43-8-21,
the Monroe Probate Court has the 'exclusive right to
proceed.' We remand the cause (probate no. 10058)
to the Escambia Probate Court, which shall set aside
its order admitting the 2007 will to probate and
appointing William as personal representative,
recalling and revoking any letters testamentary
issued therewith. William's petition filed in
Escambia County shall be held in abeyance in
accordance with § 43-8-21(b). We reverse the
judgment of the Monroe Probate Court because it
erred in dismissing Alice's petition to probate the
1995 will. We remand the cause (probate no. 3330)
to the Monroe Probate Court for proceedings
consistent with this opinion, i.e., to proceed with
Alice's petition to probate the 1995 will allegedly
executed by the decedent in light of its status as
the first 'commenced' probate proceeding of the
decedent's estate under § 43-8-21."
164 So. 3d at 544-547.
Following our remand in Taylor I, William filed an answer
and counterclaim in the Monroe Probate Court contesting the
1995 will.1 William's answer and counterclaim denied that
Alice Earle Harper had executed the 1995 will, and he alleged
several reasons why, according to William, the 1995 was
invalid or had been revoked. Among those reasons was that the
1It does not appear that James Robison Harper, Jr. joined
William's answer and counterclaim or filed his own; nor has
James Robison Harper, Jr. filed a brief to this Court.
6
1150236
1995 will "was revoked by" the 2007 will, which, according to
William, "was duly signed, published, witnessed and self-
proving." William attached a certified copy of the 2007 will
to his answer and counterclaim, and he noted that he had filed
the 2007 will for probate in the Escambia Probate Court and
that that proceeding was being held in abeyance pursuant to
this Court's mandate in Taylor I. William's answer and
counterclaim requested that the Monroe Probate Court deny
Alice's petition to probate the 1995 will and enter an order
stating "that the alleged 1995 will was revoked either by
Alice Earle Harper's execution of the 2007 will, or by other
actions by Alice Earle Harper."
On February 27, 2015, Alice filed in the Monroe Probate
Court an "Answer to Will Contest and Motion to Transfer,"
wherein Alice answered William's contest of the 1995 will and
requested that the Monroe Probate court transfer William's
contest of the 1995 will to the Monroe Circuit Court.
Thereafter, the Monroe Probate Court entered an order
transferring the contest of the 1995 will to the Monroe
Circuit Court.
7
1150236
On October 9, 2015, Alice filed a petition to probate the
2007 will in the Monroe Probate Court. Alice alleged that the
will had "purportedly" been executed by Alice Earle Harper and
had "purportedly" been witnessed. Alice attached a copy of
the 2007 will to the petition. The prayer for relief in
Alice's petition to probate the 2007 will states that Alice
"does now surrender said document for determination of
whether
it is due to be probated and whether it is the true Last Will
and Testament of Alice Earle Harper."
Also on October 9, 2015, Alice filed in the Monroe
Probate Court a petition contesting the admission of the 2007
will to probate and requesting that her will contest be
transferred to the Monroe Circuit Court.2 As grounds for the
will contest, Alice alleged that the 2007 will was not duly
executed, that Alice Earle Harper was mentally incompetent and
lacked testamentary capacity when she allegedly executed the
2007 will, and that the 2007 will was procured by fraud,
2As this Court has noted: "[A]ny person, whether he is
interested for or against the will, may offer a will for
probate in Alabama; and such person will not be estopped to
contest the validity of the instrument in the same
proceedings." Hooper v. Huey, 293 Ala. 63, 68, 300 So. 2d
100, 105 (1974), overruled in part on other grounds, Bardin v.
Jones, 371 So. 2d 23, 26 (Ala. 1979).
8
1150236
coercion, or undue influence exerted by William, who was
allegedly in a confidential, dominant, and controlling
relationship with Alice Earle Harper.
On October 15, 2015, William filed in the Monroe Probate
Court a motion to dismiss Alice's petition to probate the 2007
will, her will contest, and her request for transfer of the
will contest to the Monroe Circuit Court. William noted that
Alice had filed only a copy of the 2007 will for probate and
that the original of the 2007 will had been filed for probate
in the Escambia Probate Court by William in January 2014. He
asserted that venue for Alice's will contest was improper and
that the proper venue was the Escambia Probate Court, where
the original 2007 will had been filed for probate. Also,
William alleged that Alice's petition was untimely because the
petition to probate the 2007 will in Escambia County had been
pending since January 2014. He further stated that Alice had
waived her right to probate the 2007 will in the Monroe
Probate Court because she had filed in the Escambia Probate
Court an initial pleading in response to William's petition to
probate the 2007 will in that court, and she had failed to
contest the 2007 will or to seek a transfer of any will
9
1150236
contest at that time. William further argued that Alice
failed to satisfy the requirements of § 43-8-198 (requiring
that a demand for transfer of a will contest to the circuit
court be filed "at the time of [the] filing [of] the initial
pleading" of the party seeking transfer) because the document
constituting Alice's will contest and "demand" for transfer
and Alice's petition to probate the 2007 will were filed as
separate documents several minutes apart. Further, William
argued that a person should not be allowed to offer a will for
probate for the purpose of contesting that will.
On December 3, 2015, the Monroe Probate Court entered an
order granting William's motions to dismiss Alice's petition
to probate the 2007 will, her will contest, and her request
for transfer of her contest of the 2007 will to the Monroe
Circuit Court. Alice petitions this Court for a writ of
mandamus directing the Monroe Probate Court to enter orders
reinstating her petition to probate the 2007
will, reinstating
her will contest as to the 2007 will, and transferring that
will contest to the Monroe Circuit Court pursuant to § 43-8-
198, Ala. Code 1975.
Standard of Review
10
1150236
Although Alice has requested relief by way of a writ of
mandamus, an order dismissing a petition to probate a will is
an appealable order. See Ala. Code 1975, § 12-22-20 ("An
appeal lies to the circuit court or Supreme Court from any
final decree of the probate court, or from any final judgment,
order or decree of the probate judge...."); Smith v. Chism,
262 Ala. 417, 419, 79 So. 2d 45, 47 (1955) (citing the
essentially identical predecessor statute to § 12-22-20 and
noting that an order admitting a will to probate is an
appealable order). Also, an order dismissing a will contest
is an appealable order. See Ala. Code 1975, § 12-22-21(1)
(authorizing appeal from a probate court's "decree, judgment
or order on a contest as to the validity of a will").
It is well settled that, where "'the facts of the
particular case'" warrant our "treat[ing] a petition for a
writ of mandamus as a notice of appeal," this Court will do
so. Kirksey v. Johnson, 166 So. 3d 633, 643-44 (Ala.
2014)(quoting Ex parte Burch, 730 So. 2d 143, 147 (Ala.
1999)). We conclude that, based on the facts before us and
the posture of the underlying proceeding, Alice's petition
requesting that this Court correct alleged errors as to the
11
1150236
dismissal of her petition to probate the 2007 will and her
contest as to that will should be treated as an appeal. On
appeal, we review such dismissals de novo, and the trial
court's ruling is accorded no presumption of correctness.
See, e.g., DGB, LLC v. Hinds, 55 So. 3d 218, 223 (Ala. 2010).
As for the dismissal of Alice's motion to transfer her
will contest to the circuit court, mandamus review is proper
when a probate court allegedly errs in its ruling as to the
transfer of a will contest. See Ex parte McLendon, 824 So. 2d
700 (Ala. 2001). A petitioner seeking mandamus relief must
demonstrate that "'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 Perfection
Siding, Inc., 882 So. 2d 307, 310 (Ala. 2003) (quoting
Ex parte Integon Corp., 672 So. 2d 497, 499 (Ala. 1995)).
Analysis
As we noted in Taylor I, it has not yet been determined
whether the 1995 will or the 2007 will, or neither of them, is
the last will of Alice Earle Harper. It is possible that one
12
1150236
of those wills is the last will of Alice Earle Harper, but it
is also possible that neither of those wills is valid. In
other words, it has not yet been determined whether Alice
Earle Harper died testate or intestate, or, if she died
testate, which of the two proffered wills would control the
disposition of her estate or who will be the personal
representative of her estate.
As we further noted in Taylor I, (i) the Monroe Probate
Court is a proper venue under § 43-8-162(1), Ala. Code 1975;
(ii) the probate proceeding in the Monroe Probate Court was
commenced first; and (iii) "[§] 43-8-21(b) provides that if
multiple proceedings are commenced in more than one probate
court and those proceedings involve the same estate, then the
probate court where the proceeding was first commenced shall
hear the matter." 164 So. 3d at 545 (emphasis added).
Consequently, in Taylor I, we "reverse[d] the judgment of
the Escambia Probate Court admitting the 2007 will to probate
and appointing William as personal representative because,
under § 43-8-21, the Monroe Probate Court has the 'exclusive
right to proceed.'" 164 So. 3d at 547. We ordered the
Escambia Probate Court to set side its judgment to hold
13
1150236
William's petition to probate the 2007 will "in abeyance in
accordance with § 43-8-21(b)." Id.
Section 43-8-21(b) provides:
"If proceedings concerning the same estate are
commenced in more than one court of this state, the
court in which the proceeding was first commenced
shall continue to hear the matter, and the other
courts shall hold the matter in abeyance until the
question of venue is decided, and if the ruling
court determines that venue is properly in another
court, it shall transfer the proceeding to the other
court."
(Emphasis added.) Section 43-8-21(b) addresses "proceedings
concerning the same estate" where multiple venues are proper.
Both the petition to probate the 1995 will in the Monroe
Probate Court and the petition to probate the 2007 will in the
Escambia Probate Court concern the same estate. As we stated
in Taylor I, 164 So. 3d at 547, as between those proceedings,
the first-commenced proceeding concerning the estate of Alice
Earle Harper is the proceeding in the Monroe Probate Court,
and, because venue is proper in the Monroe Probate Court, that
court "shall continue to hear the matter."3
3Section
43-8-21
also
provides
that
a
probate
court
having
venue may, upon proper motion, determine that "in the interest
of justice a proceeding or a file should be located in another
court of this state" and "transfer the proceeding or file to
the other court." Ala. Code 1975, § 43-8-21(c). We read §
43-8-21(c) as further support for the consolidation of probate
14
1150236
Contrary to William's assertions in his brief filed with
this Court, § 43-8-21(b) does not limit the jurisdiction of
the Monroe Probate Court to only those estate matters that
were filed in that court before a proceeding concerning the
estate was filed in another court; that section applies to all
"proceedings concerning the ... estate" of Alice Earle Harper
that are filed in the Monroe Probate Court. Nor should § 43-
8-21(a) be read to limit the operation of § 43-8-21(b) in such
manner.4 Such a limitation would be contrary to the very
purpose of § 43-8-21, which is to promote judicial efficiency.
Indeed, where several wills and will contests are filed, this
Court has approved of the consolidation of such proceedings.
See Cagle v. Reeves, 353 So. 2d 787, 792 (Ala. 1977)
("[S]hould appellees desire they would have a right to test
the validity of the 1972 will against that of the 1974 will
and 1975 codicil by the simple device of filing a contest of
the 1972 will in the probate court and demanding its transfer
to the circuit court for trial. The circuit court could then
proceedings concerning an estate, where possible.
4Section
43-8-21(a) states:
"When
a
proceeding under
this
chapter could be maintained in more than one place in this
state, the court in which the proceeding is first commenced
has the exclusive right to proceed."
15
1150236
consider motions for consolidation for trial of all
contests...."); Hooper v. Huey, 293 Ala. 63, 68, 300 So. 2d
100, 105 (1974) ("If, as in the instant case, there are
several wills being contested, one of the parties may move to
consolidate the actions under Rule 42(a) of the Alabama Rules
of Civil Procedure. The trial court may, in its discretion,
order a consolidation where the actions involve a common
question of law or fact. By such consolidation, useless
trials of the same issue can be avoided.").5
5The original of the 1995 will is in the possession of the
Monroe Probate Court. The original of the 2007 will
apparently remains in the possession of the Escambia Probate
Court.
As to the fact that the original of the 2007 will has not
yet been presented to the Monroe Probate Court, we note that
William does not contest the validity of that will and, of
course, is himself responsible for placing that will in the
possession of the Escambia Probate Court. His position is
that the 2007 will is the last will of Alice Earle Harper, and
he has made that assertion in both the petition her filed in
the Escambia Probate Court and his pleadings in the Monroe
Probate Court. William does not contend that the copy of the
will Alice has provided to the Monroe Probate Court is not in
fact a copy of the 2007 will that is being held by the
Escambia Probate Court. Also, no evidentiary hearing has been
held in the Monroe Probate Court as to the validity of the
2007 will. The fact that Alice merely attached a copy of the
2007 will to her petition does not mean that she cannot and
will not arrange for the original will to be presented to the
Monroe Probate Court if and when such presentation is
necessary for purposes of the probate proceedings in that
court. Under the circumstances presented, Alice's failure
16
1150236
Based on the foregoing, the Monroe Probate Court erred by
dismissing Alice's petition to probate the 2007 will and her
contest of that will.6
thus far to have procured the original of the 2007 will and to
have filed it in the Monroe Probate Court did not justify that
court's dismissal of her petition. Alice may seek the
transfer of the original of the 2007 will from the Escambia
Probate Court to the Monroe Probate Court at the appropriate
time, if William has not done so.
6We note that William reads Allan v. Allan, 353 So. 2d
1157, 1157 (Ala. 1977), as holding that the mere meeting of
the formalities for execution of the 2007 will is all that is
required to sustain his contest of the 1995 will and that the
fact that the 2007 will might be invalid for some other reason
is not admissible as to the 1995 will contest. Such a
conclusion, however, fails to appreciate the consequence of
what would occur if the 2007 will were itself later
successfully contested on
grounds other than those relating to
the formalities of execution. In such an event, an invalid
will (the 2007 will), would have been allowed to revoke an
otherwise valid will (the 1995 will –- assuming the only
reason the 1995 will was held invalid is because of the
execution of the 2007 will), thus potentially resulting in
Alice Earle Harper's dying intestate. We cannot sanction such
an approach for two reasons.
First, the validity of the 2007 will cannot be
subdivided. The 2007 will is either valid or it is not; the
validity of the revocation clause in that will depends on the
validity of the will itself. See Grisby v. Andrews, 686 So.
2d 303, 304 (Ala. Civ. App. 1996) ("[B]ecause the revocation
clause in the subsequent will was a product of undue
influence, one must conclude that Carter lacked the intent to
revoke the first will. That purported revocation was
inoperative."); see also Vaughn v. Vaughn, 217 Ala. 364, 366,
116 So. 427, 429 (1928) ("[R]evocation by mistake, fraud,
undue influence, or by one not of testamentary capacity, ...
is inoperative because of the lack of animus revocandi.").
17
1150236
As for the dismissal of Alice's motion to transfer her
will contest to the circuit court, in Ex parte McLendon, 824
So. 2d 700 (Ala. 2001), this Court stated that "once a will
contestant seeking to remove the contest pursuant to § 43-8-
198 makes a prima facie showing that he or she is a person
described in § 43-8-190 as one 'interested therein,'•the
probate court 'must enter an order transferring the contest to
the circuit court,' § 43-8-198." 824 So. 2d at 705.7 There
is no dispute at to whether Alice made the prima facie showing
required under § 43-8-198. Thus, she was entitled to an order
transferring that will contest to the Monroe Circuit Court.8
Second, William's argument runs counter to the general
rule favoring testacy over intestacy where possible. See,
e.g., Anderson v. Griggs, 402 So. 2d 904 (Ala. 1981).
If Alice's contest of the 2007 will fails, nothing would
prevent William, at that time, from requesting that, "in the
interest of justice," the Monroe Probate Court transfer the
proceedings concerning the estate of Alice Earle Harper to the
Escambia Probate Court. See Ala. Code 1975, § 43-8-21(c).
7Section
43-8-190,
Ala.
Code
1975,
provides
that
otherwise
proper grounds for contesting the will may be asserted "by any
person interested therein, or by any person, who, if the
testator had died intestate, would have been an heir or
distributee of his estate."
8We recognize that the probate court might have dismissed
the motion to transfer the contest as to the 2007 will simply
because it had dismissed the will contest itself, i.e, there
was no remaining contest to be transferred. But because Alice
18
1150236
Accordingly, we direct the Monroe Probate Court to enter an
order transferring Alice's contest of the 2007 will to the
Monroe Circuit Court upon the reinstatement of that will
contest.9
Conclusion
As to Alice's challenge to the dismissal of her petition
to probate the 2007 will and her petition contesting the 2007
will, we treat those matters as a direct appeal, reverse the
judgment of the Monroe Probate Court, and remand the case to
that court for further proceedings consistent with this
opinion. As to the dismissal of Alice's motion to transfer of
the will contest to circuit court, we grant the petition for
the writ of mandamus.
REVERSED AND REMANDED; AND PETITION GRANTED; WRIT ISSUED.
was entitled to continue with her contest, she therefore was
entitled to a transfer order upon meeting the requirements of
§ 43-8-198.
9Because the Escambia Probate Court's order admitting the
2007 will to probate was reversed in Taylor I, there is no
concern that Alice's effort to contest the 2007 will might be
precluded by the statute of limitations applicable to a will
contest. See Ala. Code 1975, § 43-8-199 (providing that will
contest in circuit court must be filed "within the six months
after the admission of such will to probate in this state").
See also Ala. Code 1975, § 43-8-190 (providing that will may
be contested in probate court "before the probate thereof").
19
1150236
Stuart, C.J., and Bolin, Main, and Bryan, JJ., concur.
20 | October 13, 2017 |
22d0e17b-565f-4918-a194-107e95dd608e | Ivey v. Estate of R.E. Ivey | N/A | 1160280 | Alabama | Alabama Supreme Court | Rel: 09/08/2017
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
SPECIAL TERM, 2017
____________________
1160280
____________________
Edwyna Ivey
v.
Estate of R.E. Ivey
Appeal from Monroe Circuit Court
(CV-14-900125)
BRYAN, Justice.
Edwyna Ivey ("Edwyna") appeals from a judgment of the
Monroe Circuit Court ("the trial court") denying her petition
for an omitted-spouse share of the estate of her late husband,
1160280
R.E. Ivey ("R.E."). For the reasons set forth herein, we
reverse and remand.
Facts and Procedural History
In 1975, R.E. executed a will leaving the entirety of his
estate to his first wife, Nancy S. Ivey ("Nancy"), or, in the
event Nancy preceded him in death, to his and Nancy's four
children -– Sharyl I. Eddins ("Sharyl"), William R. Ivey
("Robbie"), Dell Moody ("Dell"), and Ty Ivey ("Ty")
(hereinafter collectively referred to as "the children") -–
in
equal shares. It is undisputed that R.E.'s 1975 will is the
only will he ever executed and that he never executed a
codicil to that will. Nancy died in 2001, and, in 2004, R.E.
married Edwyna. R.E. died on March 26, 2014, survived by
Edwyna and the children.
On June 27, 2014, Sharyl, as the
named executor of R.E.'s will, petitioned the Monroe Probate
Court ("the probate court") to admit R.E.'s will to probate.
Edwyna then petitioned the probate court for an intestate
share of R.E.'s estate pursuant to § 43-8-90, Ala. Code 1975,
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on the basis that R.E.'s will contained no provision for her.1
Section 43-8-90, the omitted-spouse statute, provides:
"(a) If a testator fails to provide by will for
his surviving spouse who married the testator after
the execution of the will, the omitted spouse shall
receive the same share of the estate he would have
received if the decedent left no will unless it
appears from the will that the omission was
intentional or the testator provided for the spouse
by transfer outside the will and the intent that the
transfer be in lieu of a testamentary provision be
reasonably proven.
"(b) In satisfying a share provided by this
section, the devises made by the will abate as
provided in section 43-8-76."
The probate court admitted R.E.'s will to probate, and, upon
petition from Sharyl, the trial court subsequently entered an
order removing the administration of R.E.'s estate from the
probate court.
In response to Edwyna's petition, Sharyl argued that
Edwyna's omitted-spouse claim was due to be denied on the
grounds that R.E. and Edwyna had "a mutual antenuptial
agreement ... wherein they each ... agreed that neither would
make any affirmative claim in and to the estate of the other"
and that R.E. had made "alternative provision[s]" for Edwyna
1Edwyna's
petition
also
sought
homestead,
exempt-property,
and family allowances. See §§ 43-8-110 through -112, Ala.
Code 1975.
3
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in lieu of a testamentary provision. Specifically, Sharyl
alleged that R.E. had provided for Edwyna by transfer outside
his will in that (1) he "performed substantial renovation work
in [Edwyna's] house in Andalusia, which materially increased
the value of her property," and Edwyna "had no labor cost
involved in the work" and (2) he and Edwyna had "established
some joint bank accounts with right of survivorship" that,
Sharyl contended, "substantially exceeded $100,000 in total
value." On August 8, 2016, the trial court held an
evidentiary hearing on Edwyna's petition, and the testimony
and evidence presented at that hearing provided the following
relevant facts.
Although it was undisputed that R.E. and Edwyna did not
execute
a
written
antenuptial
agreement,
Sharyl
testified
that
"there was a verbal agreement made before the marriage, during
the marriage, that ... [R.E.'s and Edwyna's] estates were
separate." According to Sharyl, before R.E. and Edwyna
married, they
"talked about the fact that they had everything
planned out, that what was hers would stay hers and
what was his would stay his and that that's the way
they wanted it. She made the statement that she
didn't need anybody's money. She had her own money
and could take care of herself."
4
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Sharyl further testified that she heard R.E. and Edwyna
make similar statements "many times" throughout the course of
their marriage, and multiple witnesses corroborated Sharyl's
testimony. Lance Eddins ("Lance"), Sharyl's son, testified
that R.E. and Edwyna's "most prevalent comment was always
their affairs were always separated, meaning that her money
was hers and his money was his." James Moody, Dell's husband
and R.E.'s son-in-law, testified that Edwyna "had made the
statement that whatever [R.E. and Nancy] ... had before they
got married ... belonged to [R.E.] and [the children], and the
only thing [Edwyna] felt like she ... should get ... was
anything [she and R.E.] accumulated while they were married."
Larry Eddins ("Larry"), Sharyl's husband, testified that
"Edwyna would say things like, I'm not getting into [the
children's] inheritance or that kind of thing."
Sharyl also testified to a conversation she had "many
times" with R.E. regarding his will:
"I asked him [(R.E.)] ... [D]o you have everything
in order; do you have everything like you want it?
He said, I do, I do. And I said, so you're okay
with everything? You've got everything like you
want it? He said, yeah, you know we have told you
over and over that what's [Edwyna's] is hers and
what is mine is mine and that you know that I have
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the will ..., and it says exactly what I want it to
say."
Robbie testified to a similar conversation he had had
with R.E. a few months before R.E.'s death:
"Q. Did [R.E.] show [the will] to you on that
occasion?
"A. Yeah, ... he said, everything is going to be
divided up equally between the four kids -- which
I'd already known that. And he said, y'all don't
need to worry about Edwyna. She's got her few
hundred acres, or whatever it is, out in Conecuh
County, farmland. She's got the insurance money from
her son, and then she's got her retirement and other
investments that are out there. She said --
basically, the agreement was, you know, what's hers
is hers, mine is mine, and she's got plenty to take
care of herself.
"Q. Specifically, did he talk about the need or
the need not to make a new will?
"A. He had said -- at one point they had talked
about making new wills, but both of them said it was
too expensive -- back to they're both frugal, and he
said, nothing is going to change anyway, so why
change it, other than update it with new dates."
Edwyna disputed the testimony indicating that she and
R.E. had agreed that "what was hers would stay hers and what
was his would stay his." She testified: "Until this
[litigation] c[a]me up, I never heard that statement before.
You see, that's all [Sharyl's] relatives that are swearing
that that's what we said." Contrary to the testimony
6
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indicating that R.E. and Edwyna had agreed that neither of
them would be entitled to a share of the other's estate,
Edwyna testified that R.E. intended to provide her with a
share of his estate but that he had elected not to execute a
new will because he believed "the state" would determine
Edwyna's share of his estate. According to Edwyna, that
belief was based on articles she and R.E. had read in Reader's
Digest, a general-interest periodical. Regarding those
articles and her and R.E.'s understanding of them, Edwyna
testified:
"A. Well, we had the Reader's Digest legal
guide, and in there it said that, if somebody died
and left a widow -- a second marriage, then the
state would determine how much she would get, and it
was -- some states is half the estate and some is a
fourth. That's what [R.E.] went by and what I went
by. [R.E.] asked me, are you satisfied with that?
And I said, yes. So he didn't want to go out and
spend money for an attorney.
"....
"Q. You and [R.E.] both discussed this and were
satisfied with whatever the state law required?
"A. That's right."2
2Excerpts from the Reader's Digest were admitted into
evidence. One of those excerpts states, in part: "[I]f there
is no premarital agreement a spouse cannot be disinherited and
can make a claim of one-third to one-half of an estate."
Another states, in part: "All states ... prohibit you from
7
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Regarding the provisions R.E. allegedly made for Edwyna
by transfers outside the will, it was undisputed that, when
R.E. and Edwyna began dating, R.E. lived in his house in
Monroeville and Edwyna lived in her house in Andalusia. After
they married, R.E. retained his house in Monroeville, but he
and Edwyna moved into Edwyna's house (hereinafter referred to
as "the marital home") and lived there throughout their
marriage. Edwyna executed a will that gave R.E. a life estate
in the marital home. According to Sharyl, it "wasn't very far
into the marriage" when R.E. asked her if she and Larry would
help Edwyna and him remodel the kitchen in the marital home.
Sharyl testified that she and Larry were happy to assist with
the renovations and that, in fact, she suggested that Edwyna
also make other renovations that, Sharyl said, would increase
the value of the marital home. Although Edwyna initially
resisted making additional renovations, Sharyl testified that
"the project got bigger and bigger" until it eventually
included a complete remodeling of the kitchen, two bathrooms,
and a sunroom; "re-doing" floors; removing doors between the
disinheriting a spouse, although some may allow you to
reestablish such an arrangement with a legal document such as
a valid prenuptial agreement."
8
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kitchen and the living room "to make it more accessible";
painting; upgrading appliances; and "doing" garage doors.
With the exception of the replacement of kitchen cabinets,
which Edwyna paid a contractor to replace, Sharyl, Larry, and
Robbie provided the labor for the renovations at no charge to
Edwyna. However, Sharyl testified that Edwyna attempted to
pay Larry and her for their labor but they refused any payment
because "that's the way we wanted it. I would like to do that
for my dad at anytime and for Edwyna."
Although Sharyl, Larry, and Robbie provided the bulk of
the labor required for the renovations, R.E. and Edwyna
purchased the necessary materials. However, there was no
evidence of the total cost of the materials, and it was
unclear how much of the materials R.E. and Edwyna each
purchased separately. Sharyl testified that Edwyna "wanted it
to be just her money that paid for [the renovations] because
that was her house." However, she also testified that R.E.
purchased "some of the things." It was undisputed that the
renovations to the marital home increased its value, but there
was no evidence as to the actual pre- or post-renovation value
of the marital home. Rather, testimony merely indicated that,
9
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after the renovations, the marital home was "top-notch" and
"pretty close" to "tip-top condition."
When asked why R.E. wanted to renovate the marital home,
Sharyl testified:
"Daddy told me that he wanted [the marital home]
left so that, if something happened to him, Edwyna
would not be taken by somebody else, kind of like
she was on her sun room. And he wanted things to be
good and to be working so that she would not be
taken by some other person that came along ... to
fix something. He wanted it to be more modernized."
Robbie corroborated Sharyl's testimony regarding R.E.'s
motivation for renovating the marital home:
"[Edwyna] had gotten ripped off when she did the
screened-in porch, and I think that was kind of the
running theme, if something happened to him, he
didn't want Edwyna to be ripped off again, so let's
get the house in order, get it more upgraded, so
that she wouldn't have to worry about that in the
future."
Lance and Larry similarly testified, respectively, that
R.E. wanted to renovate the marital home because he wanted to
ensure "that [Edwyna's] house was taken care of and leave it
in a better condition if he was not able to be here" and that
"he wanted things to help [Edwyna] out down the road ... to
make it easier in her life."
10
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Regarding the accounts on which R.E. and Edwyna were
joint tenants, it was undisputed that, before R.E. died, he
sold a trailer for approximately $60,000 and that he intended
for the proceeds from that sale to be distributed equally
among the children if he did not use the proceeds to purchase
a new truck. Because R.E. was undecided about purchasing a
truck, he deposited the proceeds into a joint account ("the
trailer account") he shared with Edwyna, ownership of which
succeeded to Edwyna upon R.E.'s death. Approximately two
months after R.E.'s death, Edwyna sent a letter regarding the
trailer account to the children. That letter stated, in
pertinent part:
"Today, I elected to transfer funds out of mine and
your Dad's name for the sale of the trailer ....
"The reason being: With the funds left in my name
only, Winston [(Edwyna's son]) could have claimed a
portion since my name was on the account only;
therefore, I have changed the account to:
"Mrs. Edwyna L. Ivey with the beneficiaries:
[Sharyl] Eddins, Ty Ivey, Dell Moody, and Robbie
Ivey.
"The way the account is set up: If one of you or all
four of you want your fourth of the money, you can
advise me and I will send you each a check. Or, you
can wait until I die and receive your portion of the
Money Market Account .... Each is to receive a
11
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fourth of the proceeds at the time you desire the
money or at my death.
"....
"I know your Dad would want each to receive the same
portion of the proceeds from the trailer. ...
"I hope this is satisfactory to each one as I did
not want to involve Winston in any way. She (the
lady at the bank) assured me that since it is in my
name and you four children are the beneficiaries, he
would not be able to get any money from this account
.... I just wanted the four children to get the
proceeds and I felt that is the way your Dad would
want it."
In addition to the trailer account, Sharyl testified that
Edwyna also succeeded to ownership of three money-market
accounts on which she and R.E. were joint tenants, each of
which contained approximately $15,000 at the time of R.E.'s
death. Regarding those
accounts, Sharyl offered into evidence
a handwritten note she made during a meeting with Edwyna
shortly after R.E.'s death, at which she and Edwyna discussed
R.E.'s estate. That note lists, among other things, the
identical balances of the three money-market accounts, with a
name or names next to each balance. Written next to one of
the money-market balances is Sharyl's name; written next to
another are R.E.'s and Edwyna's names; and written next to
another is Robbie's name. Although there was no testimony as
12
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to the significance of the names written beside the balances,
Sharyl testified that her note indicates "what [Edwyna] had,
where the money was, and what was to be done with that money."
(Emphasis added.)
Two days after Edwyna sent the letter regarding the
trailer account, she sent a letter to Sharyl regarding one of
the three money-market accounts, presumably the account
identified by Sharyl's name (hereinafter referred to as "the
first money-market account"). That letter stated, in
pertinent part:
"You will recall that your Dad had set up a $15,000
Money Market Account in your name and in his name at
CCB.
"On March 10, he elected to move the account from
CCB and it was $15,247.85, which was put in Southern
Independent Bank, in Andalusia, Alabama, along with
the check he received from the sale of the trailer,
in mine and his name.
"The account was then left in my name, after the
passing of your Dad, and I did not want it to look
like it was part of my estate so I had it changed to
my name and you as the beneficiary. The lady at the
bank said I could write you a check any time you
want it and I can wire transfer it or mail it to
you. If I should die before you get this money, no
one could receive it but you as you are the
beneficiary. Let me know what you want done with
this and I will abide by your wishes. I would like
for it to be handled at your earliest convenience so
I will know you got the amount due you.
13
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"Hope this is all satisfactory to you ... I just
wanted it so Winston would not think it was part of
my estate."
Based on Edwyna's letters, Sharyl testified that the
funds in the trailer account and the first money-market
account "were supposed to be for us [(the children)]," and it
was undisputed that Ty asked for and received his share of the
funds in the trailer account. However, although Edwyna's
letters indicated that she would distribute the funds in those
accounts to the children upon their requests, Sharyl testified
that, "upon asking about it, we were told that her lawyer said
don't release it." When asked if she intended to distribute
the funds in the trailer account and the first money-market
account to the children, Edwyna testified that she would "just
wait and see what the judge says." However, Edwyna later
testified that, "after [the children] treated me so dirty and
have caused me all this stress and everything that I've been
under, I wouldn't give them a dime."
As to the other two money-market accounts, Sharyl
testified that one of those accounts, presumably the one
identified on the note she made while meeting with Edwyna
after R.E.'s death by R.E.'s and Edwyna's names, was "money
14
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that ... [R.E.] had put ... into an account for Edwyna."
However, Sharyl offered no similar testimony as to the third
money-market account, nor was there any other evidence as to
R.E.'s intent with respect to ownership of the third money-
market account, other than Sharyl's testimony that her note
indicates "what was to be done with that money" and the fact
that the note identifies that account as Robbie's.
Finally, Sharyl testified that Edwyna also succeeded to
ownership of approximately $10,000 in a checking account on
which she and R.E. were joint tenants. Edwyna testified that
the joint checking account was an account she owned before she
married R.E., that she added R.E.'s name to the account after
they married, and that the couple used that account "to buy
groceries and pay electricity bills and stuff like that."
Although Edwyna conceded that R.E. deposited funds into the
joint checking account throughout their marriage, there was
no
evidence indicating the value of the account at the time
Edwyna added R.E.'s name to it or of R.E.'s contributions to
the account.3
3Sharyl also testified that Edwyna and Dell were joint
tenants with R.E. on an account the parties identified as "the
farm account," which contained approximately $15,000 at the
time of R.E.'s death. However, it was undisputed that Dell
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On August 24, 2016, the trial court entered the judgment
from which Edwyna appeals, denying her petition for an
omitted-spouse share of R.E.'s estate. As a threshold matter,
the trial court stated that, at the parties' joint request, it
would adjudicate Edwyna's request for homestead, exempt-
property, and family allowances, see supra note 1, at a later
date and that it was ruling on only Edwyna's omitted-spouse
claim. The trial court then made detailed factual findings,
set forth, in pertinent part, as follows:
"R.E.
and
Edwyna
never
executed
a
written
antenuptial or post-nuptial agreement. Under the
law of Alabama, for such an agreement to be
enforceable by its terms in law it must be in
writing. (§ 43-8-72, Ala. Code 1975.) However, the
Court finds from the evidence that R.E. and Edwyna
had a verbal agreement and mutual understanding
which provided that 'what is mine will remain mine
and what is his will remain his' and likewise.
Various witnesses confirmed that this statement was
repeated by both R.E. and Edwyna on numerous
occasions throughout their marriage in the presence
of family and friends. Although this verbal
agreement is not enforceable as a matter of law
since it is not in writing, it nonetheless sheds
significant light on the intentions of the parties
to the marriage with respect to the dispositions of
their estates, and specifically whether a spouse was
unintentionally omitted in the terms of a will.
"....
withdrew those funds shortly after R.E.'s death and deposited
them into an account to which Edwyna had no access.
16
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"In the case at bar, the Court finds that R.E.
did not unintentionally disinherit Edwyna. Instead,
the Court finds that R.E. specifically re-examined
his old will during his last illness, and confirmed
that the terms of the old will were what he still
wanted, in view of his mutual agreement and
understanding with Edwyna. Therefore, the Court
concludes
that
the
underlying
purpose
for
application of the omitted-spouse statute (i.e., to
remedy the unintentional disinheritance of the
surviving spouse) is not established by the facts of
this case. If the underlying purpose for applying
the omitted-spouse statute is not presented by the
facts and the evidence, it would seem that the
omitted-spouse claim could be disposed of at this
juncture. However, the Court is not aware of any
reported Alabama appellate decision that considers
this precise issue. Therefore, the Court will
continue with an analysis of the omitted-spouse
statute, and the circumstances under which it is
inapplicable.
"The omitted spouse statute contains two
exceptions, one of which states that the statute
does not apply if the spouse is specifically
excluded by the terms of the will, which is
obviously not presented by the facts in this case.
...
"The other exception in the omitted spouse
statute is based upon a finding that the testator
provided for the surviving spouse outside the will
by inter vivos transfers or otherwise, in lieu of
testamentary transfers. In the case at bar, the
evidence is undisputed that R.E. undertook to make
significant renovations, remodeling and restoration
work in Edwyna’s home in Andalusia. R.E. and
members of his family did the bulk of this work,
with no charge to Edwyna, except for materials. The
entire remodeling and renovation significantly
increased the value and enjoyment of Edwyna’s home.
The Court finds from the evidence that R.E. stated
17
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that in the event of his death he wanted to make
sure that he left Edwyna with a functional house, in
good repair, because she would not be able to see to
the work herself. He also stated that a contractor
had taken advantage of Edwyna on some work in her
house on a prior occasion, and he wanted to avoid
that circumstance. R.E. further stated that he
intended to return to live in a small house in
Monroeville if he outlived Edwyna. Considering the
underlying facts of this case, the Court finds and
determines that the work on Edwyna's home should be
viewed as an inter vivos transfer by R.E. in lieu of
a testamentary gift that satisfies the second
exception under the omitted spouse statute.
"The Court further finds that approximately
$100,000
in
survivorship
bank
deposits
which
originated with R.E. passed to Edwyna on his death,
and that such funds passing to Edwyna should be
viewed as a transfer [in] lieu of a testamentary
gift, also satisfying the second exception under the
omitted spouse statute.
"In reaching this conclusion, the Court finds
specific guidance from the case of Wester v. Baker,
675 So. 2d 447 (Ala. Civ. App. 1996), which has
similar facts, and the case of Ferguson v.
Critopoulos, 163 So. 3d 330 (Ala. 2014), which
contains a detailed analysis of the omitted spouse
statute, and the enumeration of several factors
which a court is given discretion to consider in
weighing a claim under the omitted spouse statute,
including the following factors which the Court has
specifically considered and afforded weight, viz:
(1) inter vivos transfer by R.E. consisting of the
work on Edwyna's house; (2) the value of the work on
Edwyna’s house; (3) the value of the survivorship
accounts which passed to Edwyna; (4) R.E.'s
statements that he had specifically reexamined the
terms of his old will, and did not elect to change
the will; (5) the substantial nature of Edwyna's
separate estate that she brought into the marriage;
18
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(6) the beneficiaries under R.E.'s will, who are his
children, with a consideration that a significant
part of his estate consisted of ancestral property
which was acquired from his first wife, the mother
of his children; and (7) the duration of the
marriage."
Given those findings, the trial court denied Edwyna's
omitted-spouse claim and certified its judgment as final
pursuant to Rule 54(b), Ala. R. Civ. P. See Hellums v.
Reinhardt, 567 So. 2d 274 (Ala. 1990). Edwyna timely
appealed.
Standard of Review
"'[W]hen
a
trial
court
hears
ore
tenus
testimony, its findings on disputed facts are
presumed correct and its judgment based on those
findings will not be reversed unless the judgment is
palpably erroneous or manifestly unjust.' Philpot
v. State, 843 So. 2d 122, 125 (Ala. 2002).
'However, where the facts before the trial court are
essentially undisputed and the controversy involves
questions of law for the court to consider, the
court's
judgment
carries
no
presumption
of
correctness.' Allstate Ins. Co. v. Skelton, 675 So.
2d 377, 379 (Ala. 1996). Questions of law are
reviewed de novo. BT Sec. Corp. v. W.R. Huff Asset
Mgmt. Co., 891 So. 2d 310 (Ala. 2004)."
Alabama Republican Party v. McGinley, 893 So. 2d 337, 342
(Ala. 2004).
Discussion
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Section 43-8-90 provides that, if a testator's will does
not provide for the testator's surviving spouse who married
the testator after the execution of the will, the omitted
spouse is entitled to an intestate share of the testator's
estate unless one of two exceptions applies:
"(1) if it appears from the will that the omission
of the surviving spouse was intentional or (2) if
the testator provided for the surviving spouse with
transfers outside the will with the intent that
those transfers were in lieu of a provision in the
will."
Ferguson v. Critopoulos, 163 So. 3d 330, 343 (Ala. 2014)
(emphasis added). If either of those exceptions applies, the
surviving spouse is not entitled to an omitted-spouse share of
the testator's estate. Id. Conversely, if neither exception
applies, the surviving spouse "shall receive" an omitted-
spouse share of the testator's estate. § 43-8-90 (emphasis
added).
In this case, it was undisputed that there is no language
in R.E.'s will indicating that the omission of a future spouse
from the will was intentional. As a result, the trial court
correctly determined that the first exception in the omitted-
spouse statute is inapplicable. See Ferguson, 163 So. 3d at
343 ("Nothing in the decedent's will indicates that the
20
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omission of Katina from the will was intentional; therefore,
the first exception to the omitted-spouse share is not
applicable."). Thus, unless Sharyl, as the proponent of the
will, proved that R.E. provided for Edwyna by transfer outside
the will and that he intended for such a transfer, if any, to
be in lieu of a testamentary provision, Edwyna is entitled to
an omitted-spouse share of R.E.'s estate. See Hellums, 567
So. 2d at 277 (holding that "once the surviving spouse proves
that he was omitted from the will, the burden of proof shifts
to the proponent of the will to show that the testator
provided for the surviving spouse by inter vivos transfers and
that those transfers were intended to be in lieu of a
testamentary provision" (emphasis added)); and Becraft v.
Becraft, 628 So. 2d 404, 406 (Ala. 1993) (noting that, to
overcome a prima facie showing of an omitted-spouse claim, the
opposing party "must reasonably prove both that [the testator]
provided for [the surviving spouse] by gift outside the will
and that he intended this gift to be in lieu of a testamentary
gift" (emphasis added)).
As noted above, the trial court determined that Edwyna
received two inter vivos transfers in lieu of a testamentary
21
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provision: "the work on [the marital home]" and
"approximately
$100,000 in survivorship bank deposits which originated with
R.E. [and] passed to Edwyna on his death." On appeal, Edwyna
argues that, even if the renovations to the marital home and
the funds in the joint bank accounts constitute "transfers" to
her for purposes of § 43-8-90, Sharyl failed to carry her
burden of proving that R.E. intended for those transfers to be
in lieu of a testamentary provision. For the reasons set
forth below, we agree.
I. The Renovations to the Marital Home
In reaching its conclusion that the renovations to the
marital home constituted a transfer intended to be in lieu of
a testamentary provision, the trial court noted that it was
guided by Wester v. Baker, 675 So. 2d 447 (Ala. Civ. App.
1996). In Wester, the Coosa Circuit Court denied Owen W.
Wester's petition for an omitted-spouse share of the estate of
his deceased wife, Virginia C. Eason. The evidence indicated
that, before Wester and Eason married, Eason had lived in a
house that she owned. After Wester and Eason married, they
purchased three parcels of real property in joint tenancy with
right of survivorship and lived in a house on that property
22
1160280
throughout their marriage. Although Wester testified that he
alone had purchased the marital property, there was
conflicting testimony indicating that Eason had "helped"
Wester purchase the property "so that Wester would have a
house of his own and that [Eason] would not have to change her
will." 675 So. 2d at 448. Thus, because there was evidence
from which the circuit court could have found that Eason
contributed her own funds toward the purchase of the marital
property and that she intended for that purchase to be in lieu
of a testamentary provision for Wester, the Court of Civil
Appeals affirmed the circuit court's judgment.
The
circumstances
in
this
case,
however,
are
distinguishable from those in Wester. Unlike in Wester, where
there was testimony from which the circuit court could have
determined that Eason contributed her own funds toward the
purchase of the house Wester received after her death, here it
is undisputed that Edwyna owned the marital home before she
married R.E. The trial court equated the (indeterminate)
increase in the value of the marital home with Eason's
purchase of marital property in Wester, but, even if we assume
(which we do not) that renovating property so as to increase
23
1160280
its value is analogous to purchasing property, R.E.'s
contributions in renovating the marital home were apparently
minimal. Whereas in Wester there was evidence indicating that
Eason contributed funds toward the purchase of the house
Wester received, the evidence in this case indicated that the
only "transfer" R.E. made to Edwyna with respect to the
renovation of the marital home was to purchase an unknown
percentage of the necessary materials and to appeal to his
family to provide free labor. However, it was also undisputed
that Edwyna purchased some of the materials necessary to the
renovations, and, in fact, it appears that Edwyna purchased
the majority of the materials because, according to Sharyl,
Edwyna "wanted it to be just her money that paid for [the
renovations] because that was her house." It was also
undisputed that Edwyna offered to pay for the labor but that
her offer was refused. Although today's opinion should not be
interpreted as conclusive of the issue whether renovations to
real property can ever constitute a transfer for purposes of
§ 43-8-90, where the evidence indicates only that the testator
solicited free labor and purchased an unknown percentage of
the materials necessary to renovate property the testator's
24
1160280
surviving spouse owned before marrying the testator, those
contributions from the testator, without more, do not
constitute a "transfer" for purposes of § 43-8-90.
More significantly distinguishing Wester and this case is
the fact that, in Wester, there was testimony indicating that
Eason had expressly stated that she contributed funds toward
the purchase of the house Wester received so that she would
not have to change her will, i.e., that Eason intended for the
purchase of the house to be in lieu of a testamentary
provision for Wester. In this case, although both Sharyl and
Robbie testified that R.E. had indicated to them that he did
not want to change his will, they did not testify that R.E.
had indicated that he wanted to renovate the marital home so
that he would not have to change his will. To the contrary,
Sharyl and Robbie testified, respectively, that R.E.'s
motivation for renovating the marital home was
specifically so
that Edwyna "would not be taken by some other person that came
along ... to fix something" and because he did not want her
"to be ripped off again." See Ferguson, 163 So. 3d at 343
(noting that one factor to consider in determining whether
nontestamentary transfers were intended to be in lieu of a
25
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testamentary provision is "statements made by the testator
concerning [the] transfers"). Those statements do not
indicate that R.E. intended that the renovation of the marital
home was to be in lieu of making a testamentary provision for
Edwyna but, instead, indicate that R.E. wanted to renovate the
home to protect Edwyna from opportunistic contractors.
As noted above, the fact that a testator makes a
nontestamentary transfer to his or her surviving spouse is
insufficient in and of itself to preclude an omitted-spouse
claim. Indeed, the plain language of the second exception in
§ 43-8-90 requires more than mere proof that a nontestamentary
transfer occurred. Rather, to show that the second exception
in § 43-8-90 operates to preclude an omitted-spouse claim, the
party opposing the claim must show both that the transfer
occurred and that the testator intended for the transfer to be
in lieu of a testamentary provision for the surviving spouse.
Hellums, supra; Becraft, supra; and § 43-8-90. Thus, it is
the testator's intent in making the nontestamentary transfer
that is dispositive in determining whether the second
exception in § 43-8-90 is operative in an omitted-spouse case.
Here, the testimony indicated that R.E.'s intent in
renovating
26
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the marital home was to protect Edwyna from being exploited by
unscrupulous individuals in the event he preceded her in
death; nothing in the evidence supports the conclusion that
R.E. intended such protection to be in lieu of a testamentary
provision for Edwyna. Accordingly, even if the renovations to
the marital home had constituted a transfer to Edwyna, Sharyl
failed to carry her burden of reasonably proving that R.E.
intended for those renovations to be in lieu of a testamentary
provision.
II. The Joint Bank Accounts
In Hellums, supra, this Court, citing In re Estate of
Taggart, 95 N.M. 117, 619 P.2d 562 (N.M. Ct. App. 1980),
noted: "Examples of inter vivos transfers that have been held
to be in lieu of testamentary provisions are the opening of
joint tenancy checking and saving accounts and the assignment
of retirement or insurance benefits." Hellums, 567 So. 2d at
277-78. However, we reiterate that the mere fact that a
testator and his or her surviving spouse are joint tenants on
a bank account and that the funds in that account are thus
transferred to the surviving spouse upon the testator's death
is insufficient, in and of itself, to preclude the surviving
27
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spouse's omitted-spouse claim against the testator's estate.
See Hellums, supra; Becraft, supra; and § 43-8-90 (all
providing that the party opposing an omitted-spouse claim must
prove the testator's intent with respect to nontestamentary
transfers made to the surviving spouse). As the Court of
Appeals of New Mexico stated in Taggart:
"Notwithstanding the fact that Mr. Taggart
intended to transfer the funds in the checking,
savings, and retirement accounts to Margie Taggart,
the plaintiffs also had the burden of demonstrating
that Mr. Taggart considered the fact that she was
not a beneficiary under the will and had intended
the transfers to take the place of such testamentary
devise."
95 N.M. at 124, 619 P.2d at 569 (emphasis added).
Accordingly, if the party opposing an omitted-spouse
claim shows that the claimant received the funds in a joint
account shared with the testator, but fails to show that the
testator intended for the receipt of those funds to be in lieu
of a testamentary provision for the claimant, the claimant
will be entitled to an omitted-spouse share of the testator's
estate, notwithstanding the fact that the claimant received
the funds in the joint account upon the testator's death. See
Becraft, supra (affirming a probate court's judgment awarding
the surviving spouse an
omitted-spouse share of the testator's
28
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estate, even though she was the beneficiary of the testator's
$25,000 life-insurance policy, because there was conflicting
evidence as to whether the testator intended for the insurance
proceeds to be in lieu of a testamentary provision); and
Estate of Groeper v. Groeper, 665 S.W.2d 367 (Mo. Ct. App.
1984) (reversing the denial of an omitted-spouse claim despite
the fact that the testator and his surviving spouse were joint
tenants on multiple accounts).
In this case, it was undisputed that R.E. and Edwyna were
joint tenants on the trailer account and that the account
contained approximately $60,000 when R.E. died. However, it
was also undisputed that R.E. intended for the children to
inherit the funds in that account; that, in accord with R.E.'s
wishes, Edwyna contacted the children and offered to
distribute to the children, at their requests, their
respective shares of the funds; and that one child, Ty, in
fact requested and received his share of the funds. In
addition, Sharyl, in inventorying R.E.'s estate, listed as an
asset of the estate a cause of action against Edwyna for the
funds in the trailer account -- a tacit admission by Sharyl
that R.E. never intended for those funds to belong to Edwyna.
29
1160280
Thus, the evidence undisputedly indicated that R.E. never
intended for the funds in the trailer account to belong to
Edwyna, and, because he did not intend for those funds to
belong to her, it naturally follows that he did not have the
requisite intent that those funds would serve in lieu of a
testamentary provision for her.
Likewise, although Edwyna succeeded to ownership of the
first money-market account upon R.E.'s death, the evidence
indicated that R.E. did not intend for the funds in that
account to belong to her. Sharyl did not dispute that R.E.
did not intend for the funds in the first money-market account
to belong to Edwyna and, in fact, testified that those funds
"were supposed to be" for her (Sharyl). In addition, Edwyna's
letter to Sharyl regarding the first money-market account
indicated that Edwyna offered, as she did with the funds in
the trailer account, to distribute those funds to Sharyl at
Sharyl's request because she wanted Sharyl to "g[e]t the
amount due [her]" and that she had named Sharyl as the
beneficiary on that account because she "did not want it to
look like [those funds were] part of [Edwyna's] estate."
Thus, as was the case with the funds in the trailer account,
30
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because the evidence indicated that R.E. did not intend for
the funds in the first money-market account to belong to
Edwyna, it again naturally follows that he did not have the
requisite intent that those funds would serve in lieu of a
testamentary provision for her.
With respect to the funds in the other two money-market
accounts, the evidence undermines, rather than supports,
Sharyl's argument that R.E. intended for the funds in those
accounts to be in lieu of a testamentary provision for Edwyna.
At the hearing, 11 witnesses, including Sharyl, testified that
R.E. and Edwyna made numerous statements, both before and
during their marriage, that "what was [Edwyna's] would stay
hers and what was [R.E.'s] would stay his" and that "their
estates were separate." Matter of Cole's Estate, 120 Mich.
App. 539, 328 N.W.2d 76 (1982), involved similar testimony.
In that case, Marion Cole petitioned a Michigan probate court
for an omitted-spouse share of the estate of her deceased
husband, Robert Cole. Although it was undisputed that, upon
Robert's death, Marion received funds Robert had deposited in
joint bank accounts he shared with her, the Michigan probate
court awarded Marion an omitted-spouse share of Robert's
31
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estate because it found that Robert did not intend for those
transfers to be in lieu of a testamentary provision for
Marion. On appeal, the executor of Robert's estate argued
that
the
remedy
afforded
by
Michigan's omitted-spouse statute,
which is practically identical to Alabama's, was unavailable
to Marion because there was testimony indicating that Robert
and Marion had "left their wills unchanged intentionally" and
had stated "before and during the marriage that they intended
to keep their property separate." 120 Mich. App. at 544, 328
N.W.2d at 78. The Court of Appeals of Michigan, however,
determined that such testimony supported the Michigan probate
court's finding:
"[W]e note that the executor relies largely on
evidence which suggests that the testator did not
intend to make any provision whatever for his wife
Marion. Such evidence would not support a finding
that the transfers outside the will were intended by
the testator to be in lieu of a testamentary
provision. If the testator intended to make no
provision for Marion Cole, then he did not intend
the transfers to be such a provision."
120 Mich. App. at 545, 328 N.W.2d at 79 (emphasis added).
Similarly, in this case Sharyl went to great lengths to
prove that R.E. and Edwyna intended to keep their estates
separate, i.e., that R.E. did not intend to provide Edwyna
32
1160280
with anything whatsoever from his estate. However, the
evidence does not support -– and, in fact, directly
contradicts –- a conclusion that R.E. intended for the funds
in the money-market accounts to be in lieu of a testamentary
provision for Edwyna. That is to say, where the evidence
indicates that a testator did not intend to provide his or her
surviving spouse with anything whatsoever, it would be
illogical to conclude that such evidence, without more, is
indicative of the testator's intent that the funds in the
couple's joint accounts be in lieu of a testamentary provision
for the surviving spouse.4
Regarding the $10,000 in the joint checking account, the
undisputed testimony indicated only that Edwyna owned the
account before she married R.E.; that she added R.E. as a
joint tenant on the account after they married; that R.E. made
deposits into the account throughout the marriage; and that
the couple used the account to pay marital expenses. However,
as we noted with respect to the money-market accounts, the
evidence indicating that R.E. did not intend to provide for
4Moreover, although not dispositive of this issue, it is
worth noting that Sharyl's testimony indicated that, at most,
R.E. intended for the funds in only one of the three money-
market accounts to belong to Edwyna after his death.
33
1160280
Edwyna at all, without more, does not support a finding that
R.E. intended for the deposits he made into the joint checking
account to be in lieu of a testamentary provision for Edwyna.
Furthermore, the testimony that R.E. and Edwyna used the joint
checking account to pay marital expenses indicates that R.E.'s
intent in making deposits into that account was to contribute
funds toward those expenses; nothing in the evidence supports
the conclusion that R.E. intended for his contributions to the
couple's marital expenses to be in lieu of a testamentary
provision for Edwyna.
We reiterate once again that the mere fact that a
testator and his or her surviving spouse are joint tenants on
a bank account is insufficient in and of itself to avoid
application of the omitted-spouse statute. Hellums, supra;
Becraft, supra; Taggart, supra; and Groeper, supra. In
addition to showing that a testator's joint accounts were
transferred to his or her surviving spouse upon the testator's
death, the party opposing the surviving spouse's omitted-
spouse claim has the burden of "reasonably prov[ing]" that the
testator intended for the funds in those accounts to be in
lieu of a testamentary provision for the surviving spouse. §
34
1160280
43-8-90. In this case, there was no evidence that would
support the conclusion that R.E. intended for the funds in his
and Edwyna's joint accounts to be in lieu of a testamentary
provision for Edwyna; in fact, the evidence actually cuts
against such a conclusion. Thus, Sharyl failed to carry her
burden of proof regarding R.E.'s intent with respect to the
funds in his and Edwyna's joint accounts, and, as a result,
Edwyna's mere succession to ownership of those funds on R.E.'s
death did not constitute grounds for denying her omitted-
spouse claim.
We recognize that there was evidence from which the trial
court could have found that R.E. intentionally disinherited
Edwyna and that our reversal of the denial of Edwyna's
omitted-spouse claim thus appears, at first blush, to
conflict
with our statement in Ferguson that "[t]he purpose of § 43-8-
90 is to avoid an unintentional disinheritance of the spouse
of a testator who had executed a will prior to the parties'
marriage. It serves to give effect to the probable intent of
the testator and protects the surviving spouse." Ferguson,
163 So. 3d at 343 (emphasis added). However, as will be
shown, there is no conflict between today's decision and our
35
1160280
statement in Ferguson regarding the legislature's intent in
enacting § 43-8-90.
The facts of this case present us with a question not at
issue in Ferguson: In an omitted-spouse case, where there is
no evidence indicating that either exception in § 43-8-90
applies, but there is nevertheless evidence indicating that
the testator intentionally disinherited the omitted spouse,
does § 43-8-90 operate to preclude the omitted-spouse claim?
The plain and unambiguous language of § 43-8-90 requires us to
answer that question in the negative. See Ex parte Ankrom,
152 So. 3d 397, 409-10 (Ala. 2013) (noting that "'"[w]hen the
language of a statute is plain and unambiguous, ... courts
must enforce the statute as written"'" (quoting Ex parte
Pfizer, Inc., 746 So. 2d 960, 964 (Ala. 1999), quoting in turn
Ex parte T.B., 698 So. 2d 127, 130 (Ala. 1997))).
Section 43-8-90 plainly provides that if a testator's
will does not provide for the testator's surviving spouse who
married the testator after the execution of the will, the
omitted spouse "shall receive the same share of the estate he
would have received if the decedent left no will," i.e., an
intestate share, unless the party opposing the omitted-spouse
36
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claim proves, in one of two specific ways enumerated in § 43-
8-90,
that
the
testator
intentionally
disinherited
the
omitted
spouse. See Hellums, supra (regarding the burden of proof).
By fashioning § 43-8-90 to provide that the party opposing an
omitted-spouse
claim
must
prove
that
the
testator
intentionally disinherited the omitted spouse and that it can
do so only by proving that one of the two enumerated
exceptions applies, the legislature essentially created a
presumption
that
the
testator
unintentionally
disinherited
the
omitted spouse if neither exception applies.
Had it so desired, the legislature could have drafted §
43-8-90 to provide that the party opposing an omitted-spouse
claim can carry its burden of proving that the testator
intentionally disinherited the omitted spouse with any
evidence that tends to reflect that intent, but it did not.
Rather, the legislature chose to provide two, and only two,
specific types of evidence upon which the party opposing an
omitted-spouse claim can rely to carry its burden. In doing
so, the legislature prescribed the character of evidence
sufficient
to
prove
that
the
testator
intentionally
disinherited the
omitted
spouse
and
concomitantly
rejected
the
reliability of other evidence the opposing party might offer
37
1160280
to prove that the disinheritance was intentional. See
Sustainable Forests, LLC v. Alabama Dep't of Revenue, 80 So.
3d 270, 273 (Ala. Civ. App. 2011) ("Under the principle
expressio unius est exclusio alterius, the express inclusion
of one exception implies the exclusion of others."). Thus,
the plain language of § 43-8-90 cannot support the conclusion
that any evidence indicating that a testator intended to
disinherit his or her surviving spouse is sufficient to avoid
the application of § 43-8-90.
In this case, even though Sharyl offered evidence
indicating that R.E. and Edwyna had agreed that "what was hers
would stay hers and what was his would stay his" in an attempt
to prove that R.E. intentionally omitted Edwyna from his will,
she failed to offer evidence proving either that R.E.'s will
indicates that Edwyna's omission was intentional or that R.E.
intentionally disinherited Edwyna because he had made
nontestamentary transfers to her intended to be in lieu of a
testamentary provision -– the only exceptions enumerated in §
43-8-90. By failing to prove that either exception in § 43-8-
90 applied, Sharyl failed to prove that the omission of Edwyna
from R.E.'s will was intentional, despite what other evidence
might have indicated, and our reversal of the denial of
38
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Edwyna's omitted-spouse claim is therefore in accord with the
legislature's intent in enacting § 43-8-90 –- to avoid the
unintentional disinheritance of a spouse who marries a
testator after the execution of the testator's will. To hold
otherwise would be to fail to give effect to § 43-8-90 as it
is unambiguously written. Ankrom, supra.
Conclusion
Because Sharyl failed to carry her burden of proving that
either exception enumerated in § 43-8-90 applied, the trial
court erred in denying Edwyna's omitted-spouse claim.
Accordingly, the judgment is reversed and the case remanded
for the trial court to enter a judgment awarding Edwyna an
intestate share of R.E.'s estate pursuant to § 43-8-41, Ala.
Code 1975. On remand, the trial court may conduct any
proceedings necessary to determine Edwyna's share of R.E.'s
estate.5
REVERSED AND REMANDED WITH INSTRUCTIONS.
Stuart, C.J., and Bolin and Main, JJ., concur.
Murdock, J., concurs in the result.
5Because we hold that Edwyna is entitled to an omitted-
spouse share of R.E.'s estate, we pretermit discussion of the
other issues she raises on appeal.
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