Justia Alabama Supreme Court Opinion Summaries

Michael Falligant, as next friend of Michelle McElroy, who Falligant alleged was an incapacitated person, filed an action against TitleMax of Alabama, Inc. ("TitleMax"), alleging that TitleMax wrongfully repossessed and sold McElroy's vehicle. TitleMax filed a motion to compel arbitration of Falligant's claims, which the circuit court denied. TitleMax appealed. After review, the Alabama Supreme Court determined TitleMax met its burden of proving that a contract affecting interstate commerce existed, and that that contract was signed by McElroy and contained an arbitration agreement. The burden then shifted to Falligant to prove that the arbitration agreement was void. But the Court concluded Falligant failed to present substantial evidence indicating that McElroy was permanently incapacitated and, thus, lacked the mental capacity to enter into the contracts. Because Falligant failed to create a genuine issue of fact, the circuit court erred in ordering the issue of McElroy's mental capacity to trial. Accordingly, the circuit court's decision was reversed, and the matter remanded back to the circuit court for further proceedings. View "TitleMax of Alabama, Inc. v. Falligant" on Justia Law

Brenda and James Gustin appealed the grant of summary judgment entered in favor of Vulcan Termite and Pest Control, Inc. ("Vulcan"), and its general manager, Fred Smith. In 1998, Vulcan was hired by a construction company to pretreat a house in Shelby County, Alabama for termites. The house was three stories tall, with three concrete decks overlooking a lake. The decks were supported by 18 wooden columns. Additionally, to the left of the front door was a porte cochere for vehicles to pass through on their way up the driveway. The exterior of the house was entirely covered in faux-stone cladding. The Gustins purchased the house in 2006. In 2009, the Gustins entered into a contract with Vulcan for termite-damage inspection, treatment, and repair. In 2015, they hired a decorating company to renovate on of the rooms in the house. The company removed several sections of beadboard from the porte cochere, revealing extensive termite damage. Removing some of the cladding from the facade, the Gustins discovered active termites and severe damage to all levels and all sides of the house, as well as damage to a deck. The Gustins hired an expert, who estimated it would cost roughtly $950,000 to repair the house. Several days after the damage was discovered, Smith went to the house to inspect, and observed the active termites. Vulcan did not repair the house. The Gustins sued. In granting summary judgment, the trial court found "no evidence Vulcan breached the contract by failing to discover hidden termites. The Gustins presented no evidence that the annual inspection were not performed in accordance with the regulations or industry standards." The Alabama Supreme Court's review of the record indicated the Gustins submitted "substantial evidence" that Vulcan committed acts and omissions underlying each of their seven breach-of-contract claims. That evidence created a genuine issue of material fact regarding whether Vulcan breached its duty to "perform all services in a workmanlike manner," as the contract required. While the Court agreed with the trial court and affirmed as to some causes of action, it reversed with respect to others, and remanded the case for further proceedings. View "Gustin v. Vulcan Termite and Pest Control, Inc." on Justia Law

Plaintiff Gerriann Fagan appealed a circuit court order granting defendant Warren Averett Companies, LLC's motion to compel arbitration. Fagan was the owner of The Prism Group, LLC, a human-resources consulting firm. In February 2015, Warren Averett approached her and asked her to join Warren Averett and to build a human-resources consulting practice for it. In February 2015, she agreed to join Warren Averett, entering into a "Transaction Agreement" which provided that: Fagan would wind down the operations of The Prism Group; Fagan would become a member of Warren Averett; Warren Averett would purchase The Prism Group's equipment and furniture; Warren Averett would assume responsibility for The Prism Group's leases; and that Warren Averett would assume The Prism Group's membership in Career Partners International, LLC. The Transaction Agreement further provided that Fagan would enter into a "Standard Personal Service Agreement" ("the PSA") with Warren Averett; that Fagan's title would be president of Warren Averett Workplace; and that Fagan would be paid in accordance with the compensation schedule outlined in the PSA. Fagan alleged that she subsequently resigned from Warren Averett when she was unable to resolve a claim that Warren Averett had failed to properly compensate her in accordance with the PSA. On or about February 28, 2019, Fagan filed a demand for arbitration with the American Arbitration Association ("AAA"). The employment-filing team of the AAA sent a letter dated March 4, 2019, to the parties informing them of the conduct of the arbitration proceedings. On April 18, 2019, the employment-filing team notified the parties that Warren Averett had failed to submit the requested filing fee and that it was administratively closing the file in the matter. On April 30, 2019, Fagan sued Warren Averett in circuit court. The Alabama Supreme Court determined Warren Averett's failure to pay the filing fee constituted a default under the arbitration provision of the PSA. Accordingly, the trial court erred when it granted Warren Averett's motion to compel arbitration. View "Fagan v. Warren Averett Companies, LLC" on Justia Law

Protective Life Insurance Company ("Protective") appealed a circuit court judgment entered on a jury verdict against Protective and in favor of Apex Parks Group, LLC ("Apex"), in the amount of $11,495,890.41. Apex, a California-based corporation, owned and operated 16 moderately sized amusement parks, water parks, and family-entertainment centers nationwide. Apex's founder and chief executive officer was Alexander Weber, who had possessed 43 years' experience in the industry and who was critical to Apex's success. Because of Weber's importance, in early 2016 Apex sought a "key-man" insurance policy on Weber. Protective is a Birmingham-based insurance company owned by the Dai-ichi Corporation. At that time, Weber was 64 years old. Answers from Weber's interview with a paramedical examiner were incorporated into the Apex application for insurance. Weber underwent a series of medical examinations, all of which were reported and incorporated into the key-man policy. In November 2016, after the first premium payment was made and the policy went into effect, while on vacation with his wife, Weber died. Shortly after Weber's death, Apex submitted its claim under the policy for the $10-million benefit. Protective then began a contestable-claim investigation, contending Weber's complete medical history was not disclosed, thereby voiding the policy. Protective thereafter refunded the premium Apex paid. Apex sued Protective asserting claims of breach of contract and bad faith in failing to investigate all bases supporting coverage and in making false promises that the claim would be paid. After review, the Alabama Supreme Court determined Protective was entitled to judgment as a matter of law on Apex's claim of breach of contract, and the trial court erred by submitting this claim to the jury for consideration. Accordingly, that portion of the trial court judgment was reversed. "Because Protective demonstrated that Weber made a material misrepresentation and Apex failed to introduce substantial evidence to the contrary, Protective was entitled to rescind the policy, which was a complete defense to Apex's claims of breach of contract. Thus, the trial court erred in denying Protective's motions for a judgment as a matter of law." View "Protective Life Insurance Company v. Apex Parks Group, LLC" on Justia Law

Kevin Crook appealed summary judgment entered in favor of Allstate Indemnity Company ("Allstate Indemnity"), Allstate Insurance Company ("Allstate Insurance"), and The Barker Agency (hereinafter collectively referred to as "the defendants"). Crook owns lake-front property in Tuscaloosa County. The property consists of a house, a bathhouse, a garage, a deck, and a boat dock. In 2006, Crook, through The Barker Agency, obtained property insurance on the house and other structures from Allstate Indemnity. Allstate Indemnity issued a policy to Crook ("the policy") and provided uninterrupted insurance coverage of Crook's house from 2006 through 2015. On February 12, 2015, Allstate Indemnity conducted an inspection of the property for underwriting purposes. After the inspection, on February 23, 2015, The Barker Agency sent Crook a letter with the results, finding no "issues that impact [Crook's] current coverage, and you do not need to do anything further. ...our inspection... focused only on identifying certain types of hazards or conditions that might impact your future insurance coverage. It may not have identified some other hazards of conditions on your property." In April 2015, a storm damaged the deck and the boat dock. Ultimately, Crook sued defendants for breach of contract, bad-faith failure to pay a claim, negligent/wanton procurement of insurance, and estoppel, all relating to the policy's coverage of the storm damage. After review, the Alabama Supreme Court found no reversible error in the grant of summary judgment in favor of defendants and affirmed. View "Crook v. Allstate Indemnity Company, et al." on Justia Law

In appeal no. 1180355, Donald Porter, Marc Porter, Porter Capital Corporation, Porter Bridge Loan Company, Inc., Lowerline Corporation, CapitalPartners Leasing, Inc., and CapitalPartners Leasing, LLC (hereinafter referred to collectively as "the Porter defendants"), appealed a judgment entered in favor of Byron Porter Williamson in his action seeking specific performance of a shareholders agreement that Williamson had entered into with Donald and Marc ("the agreement"). In appeal no. 1180634, Williamson cross-appealed the same judgment seeking prejudgment interest on the full amount of the judgment. The question presented for the Alabama Supreme Court's review was whether the trial court exceeded the scope of Williamson's request for specific performance of the agreement by awarding Williamson a monetary sum representing the value of his interest in the Porter companies based on a valuation process that differed from the valuation process set forth in the agreement. The Porter defendants did not challenge the trial court's determination that Williamson's retirement was a "triggering event" under the agreement that required the Porter defendants to "acquire" Williamson's shares under paragraph 9 of the agreement. They argued only that the trial court awarded relief beyond the scope of a request for specific performance of the agreement. The Supreme Court concurred the trial court's determination of share value used an evaluation process inconsistent with the agreement. The cross-appeal was dismissed and the matter remanded for further proceedings. View "Porter, et al. v. Williamson" on Justia Law

Joshua Rogers appealed a preliminary injunction preventing Rogers from soliciting any employees or clients of Burch Corporation, his former employer, as contractually agreed to under restrictive covenants in an employment agreement. The Alabama Supreme Court determined there was nothing justiciable concerning the preliminary injunction because the nonsolicitation clause in the employment agreement expired, at the latest, on December 6, 2019. Therefore, the case was moot and the Court dismissed the appeal. View "Rogers v. Burch Corporation" on Justia Law

Consolidated appeals stemmed from an August 2012 transaction in which SMM Gulf Coast, LLC ("SMM"), purchased the assets of four salvage and recycling businesses in Alabama and Mississippi. After that transaction closed, Dade Capital Corporation ("Dade"), a creditor of one of the businesses whose assets were purchased by SMM, and Dade's president David Fournier, who owned stock in that same business, sued SMM, the four businesses that had sold their assets to SMM, and various individuals associated with those businesses alleging that Dade and Fournier should have received a greater share of the purchase price paid by SMM. Following a bifurcated trial, the trial court found that Dade and Fournier's claims were barred by a release agreement that Fournier executed in conjunction with the transaction and entered a judgment against them. SMM, two of the businesses that had sold their assets to SMM, and two individuals with ownership interests in those businesses subsequently moved the trial court to award them attorney fees, court costs, and litigation expenses in accordance with a prevailing-party provision in the release agreement. The trial court denied their motions, and those parties appeal, arguing that the prevailing-party provision entitles them to the requested awards and that they have not waived their right to recover the requested amounts. The Alabama Supreme Court determined that none of the reasons the trial court used as grounds for denial SMM's reimbursement motions was a proper basis for denial. Judgment was reversed and the matter remanded for the trial court to consider the evidence submitted by SMM and the appellant sellers in conjunction with their motions for reimbursement and to enter an appropriate award based on that evidence. View "Collier v. Dade Capital Corporation" on Justia Law

Brad Dupree sued PeoplesSouth Bank ("PeoplesSouth"), alleging that PeoplesSouth wrongfully gave the proceeds of a $100,000 certificate of deposit to his father, not him. Jimmy Dupree was Brad's father. In 1993, Jimmy opened the CD at issue here; it was issued in both Brad's and Jimmie's names. Handwritten edits on the CD later reversed the order of the names to "Jimmy Dupree and Brad Dupree" and also replaced Brad's taxpayer ID number with Jimmy's taxpayer ID number. A handwritten note, dated December 1993 on the back of the CD stated "changed order of names to report interest under Jimmy's SS#." No evidence was offered as to who made the handwritten changes, and they were not initialed by either Jimmy or Brad. Brad was a minor at the time the CD was issued and did not contribute any money to the purchase of the CD. In November 2010, before filing this case, Brad, his mother, and his stepbrother sued Jimmy alleging Jimmy had wrongfully converted certain personal property, including the CD. In 2012, while the 2010 action was pending, Jimmy cashed the CD without notifying Brad. PeoplesSouth issued a cashier's check payable to the order of "Jimmy Dupree or Brad Dupree" for the amount of the CD less amounts set off by PeoplesSouth related to Jimmy's business loan. Jimmy cashed the check and then spent the funds. Brad learned during mediation of the 2010 action that Jimmy had cashed in the CD and was advised by the mediator to sue PeoplesSouth. The circuit court entered judgment in favor of the bank. Brad appealed, arguing he should have won on his breach-of-contract claim and awarded $100,000 in damages. The Alabama Supreme Court determined that without any rights in the CD by virtue of an inter vivos gift, Brad could not show he was damaged by PeoplesSouth's alleged nonperformance, and he was therefore unable to prevail on his breach-of-contract claim. Judgment in favor of the bank was affirmed. View "Brad Dupree v. PeoplesSouth Bank" on Justia Law

Jeanne Oaks and Parkerson Construction, LLC ("Parkerson"), were engaged in a dispute concerning Parkerson's reconstruction of Oaks's fire-damaged residence in Huntsville, Alabama. Parkerson initiated the action, claiming that Oaks owed it more than $50,000 for its work. Oaks filed counterclaims alleging, among other things, that Parkerson misrepresented itself and performed deficient work. Parkerson moved the trial court to order that Oaks's counterclaims be arbitrated based on a provision in an unauthenticated work-authorization agreement that was attached to the motion. The trial court granted Parkerson's motion and ordered that Oaks's counterclaims be arbitrated. The Alabama Supreme Court reversed the trial court's arbitration order, however, because Parkerson did not meet its burden of establishing the existence of a contract calling for arbitration. View "Oaks v. Parkerson Construction, LLC" on Justia Law