Justia Alabama Supreme Court Opinion Summaries

Dannelly Enterprises, LLC ("Dannelly"), appealed a circuit court order granting a motion to compel arbitration filed by Palm Beach Grading, Inc. ("PBG"). In the fall of 2006, PBG entered into negotiations with Corvias Military Living, LLC, f/k/a Picerne Military Housing LLC; Picerne Construction/FRK, LLC; Rucker-Picerne Partners, LLC; and Rucker Communities, LLC (collectively, "the contractors"), to perform work on a project known as the Ft. Rucker RCI Family Housing, Munson Heights, Phase 1A, at Fort Rucker, Alabama. Apparently, in preparing to bid on the project, PBG contacted various subcontractors, including Dannelly, to get bids for various aspects of the project that PBG would be responsible for if it entered into an agreement with the contractors to complete the project. Although the work order issued by PBG stated that "[a] Sub-contract will be created by PBG for billing purposes," neither party submitted into evidence such a contract between PBG and Dannelly. PBG argued that Donnelly accepted benefits under existing contracts because Dannelly was hired by PBG to perform work on the project and was paid for the work it completed. The Supreme Court found, however, that PBG did not present any argument as to why it believed Dannelly was not simply operating under and benefiting from the agreement between PBG and Dannelly, which was memorialized by PBG's work order. The Court concluded that PBG failed to demonstrate that the arbitration provision in the master subcontract agreement applied to the third-party claims it asserted against Dannelly. Furthermore, there was a genuine issue of material fact as to whether Dannelly and PBG entered into PBG's standard subcontract agreement. The case was reversed and remanded to the circuit court for further proceedings. View "Dannelly Enterprises, LLC v. Palm Beach Grading, Inc." on Justia Law

State Farm Mutual Automobile Insurance Company petitioned the Alabama Supreme Court for certiorari review of the Court of Civil Appeals' decision affirming the trial court's judgment ordering State Farm to pay an attorney fee based on a common-fund theory for the recovery of the moneys advanced by State Farm to James Ross Pritchard, Jr., pursuant to "Lambert v. State Farm Mutual Automobile Insurance Co.," (576 So. 2d 160 (Ala. 1991)). Pritchard sued Broderick McCants, State Farm (Pritchard's uninsured/underinsured-motorist ("UIM") insurer), and others seeking damages for injuries Pritchard suffered in an automobile accident with a vehicle being operated by McCants. Applying the Court's determination that a UIM insurer does not have a subrogation interest in a "Lambert" advance to the facts of this case, the Court held that State Farm did not have a subrogation interest in the $50,000 it advanced to Pritchard pursuant to "Lambert" and, consequently, that Pritchard's recovery from the tortfeasor of the "Lambert" advance did not create a common fund from which State Farm was required to pay its share of Pritchard's attorney fee. View "Ex parte State Farm Mutual Automobile Insurance Company." on Justia Law

In 2004, Michael Britt purchased a Beneteau brand sailboat. Michael had insured the sailboat with St. Paul pursuant to a Seahorse Underwriters Boat Insurance Policy that provided coverage limits of $85,000 for "accidental direct physical loss of or damage to [the sailboat] ... except as specifically stated or excluded in this policy." From 2004 onward, the sailboat served as Michael's residence in Florida; Michael had no other established residence. In early September 2011, Michael telephoned Willis Britt, "Britt," his father, and told Britt that he had accepted a job driving a commercial truck and that he had to attend orientation for the new job in Oklahoma City, Oklahoma. Michael informed Britt that he planned to sail the sailboat from West Palm Beach, Florida, to Jacksonville, Florida, store the boat in Jacksonville, and rent a car in Jacksonville to drive to Oklahoma City for the orientation. On or around September 11, 2011, Michael set sail for Jacksonville. On September 15, 2011, the United States Coast Guard boarded the sailboat approximately one mile off the coast of Cape Canaveral, Florida, for a "cold hit" inspection. That inspection revealed that the sailboat was seaworthy. There was no evidence of any severe weather in the Cape Canaveral area on September 15, 2011, on which date, Michael was supposed to check in with his father upon arrival in Jacksonville, but never did. In October 2011, Britt contacted St. Paul to report the sailboat as lost. In 2012, Britt was appointed conservator of Michael's estate by the Chilton Probate Court. Shortly thereafter, Britt filed a claim with St. Paul for the lost sailboat. St. Paul sent Britt a letter in which it declined coverage for the sailboat. The Supreme Court found that the "mysterious-disappearance" exclusion in Michael's insurance policy was not ambiguous, nor did it conflict with the 30-day provision; rather, the policy, when read as a whole, could accommodate both provisions (one providing coverage and one excluding coverage). Because the Court held that the mysterious-disappearance exclusion was unambiguous and does not conflict with the 30-day provision, and because there was no genuine issue of material fact concerning the disappearance of the sailboat, the trial court should have entered a summary judgment in St. Paul's favor. View "St. Paul Fire & Marine Insurance Company v. Britt" on Justia Law

Richard and Betty B. Chesnut petitioned the Alabama Supreme Court for a writ of certiorari seeking review of the Court of Civil Appeals' opinion affirming the Madison Circuit Court's summary judgments in favor of the City of Huntsville, the Board of Zoning Adjustment of the City of Huntsville, Denton-Niemitz Realty, LLC, and Guild Building and Remodeling, LLC. In 1983, the Chesnuts purchased a house and the adjacent lot to the east of their house, which was in a Huntsville neighborhood that had been established in 1908. The neighborhood was zoned as a 'Resident 1-B' district. In October 2012, Denton-Niemitz purchased the house on the west side of the Chesnuts' house. Subsequently, Denton-Niemitz obtained a permit to raze the house it purchased. Denton-Niemitz hired Guild Building & Remodeling, LLC to demolish the Denton-Niemitz house. The city issued the permits and construction began on the new house. Richard Chesnut was concerned the new house did not comply with the applicable set-back line requirement, and requested the zoning code be enforced. When no action was taken, the Chesnuts filed suit. The Chesnuts argued that the Circuit Court erred in entering a summary judgment in the civil action because, they said, Jim McGuffey (the zoning-enforcement coordinator for the City) incorrectly interpreted Articles 12.2.4 and 73.7.4 of the City's zoning code; that, when McGuffey issued the permits, he used an "extralegal dictionary definition" of "developed" and "undeveloped"; that McGuffey ignored a mandate of the Huntsville City Council that he did not have the power to permit construction that did not conform with the zoning code; and that McGuffey and the City ignored well established rules of statutory construction and ignored their statutory mandate to administer ordinances according to their literal terms. After review, the Supreme Court reversed in part the judgment of the Court of Civil Appeals because the zoning enforcement coordinator's interpretation of the zoning ordinance was unreasonable. The Supreme Court affirmed in part the appellate court's judgment because the summary judgment and the Court of Civil Appeals' affirmance of that judgment was appropriate, not because the Chesnuts' appeal was untimely but because the Chesnuts' administrative appeal was barred by the doctrine of res judicata. The case was remanded for further proceedings. View "Ex parte Richard and Betty Chesnut." on Justia Law

Defendant Jim Burke Automotive, Inc. petitioned the Supreme Court for a writ of mandamus directing the Hale Circuit Court to vacate its order denying Jim Burke Automotive's motion to transfer the action to the Jefferson Circuit Court and to enter an order transferring the action. After Jim Burke Automotive had performed some repair work on a vehicle owned by Vulah and Andrew Smith, the vehicle was involved in an accident in Hale County. The Smiths sued Jim Burke Automotive at the Hale Circuit Court, asserting claims of negligent repair of the vehicle, wanton repair of the vehicle, breach of contract, and fraud. Andrew Smith also claimed damages for loss of consortium. Jim Burke Automotive moved to transfer the case to the Jefferson Court for improper venue, because the all repair work was performed in Jefferson County, and all the alleged acts or omissions giving rise the the Smiths' claims took place in Jefferson County. Upon review of Jim Burke Automotive's petition, the Supreme Court concluded it demonstrated a clear legal right to a writ of mandamus. The Court directed the Hale Court to vacate its order and transfer this action to Jefferson. View "Ex parte Jim Burke Automotive, Inc." on Justia Law

Emma Carter Hardy, acting on behalf of the estate of Julius Carter, Sr., appealed a final order entered by the Montgomery Circuit Court against her and in favor of Julius Hardin in a will contest. Hardy was the daughter of Julius Carter, Sr.; Hardin was the son of Thelma Carter Malone, who was also Carter's daughter. Hardy filed a petition with the Probate Court for letters of administration as to Carter's estate. Hardy alleged in the petition that Carter had died "leaving no Last Will and Testament, so far as [Hardy] knows or believes," and that the only asset of Carter's estate was a parcel of real property located in Montgomery County. The parcel of real property consisted of approximately 180 acres that Carter had farmed. At a hearing for the final settlement of the estate, Hardin filed a letter challenging the estate's administration. The Supreme Court found that the probate court noted Hardin failed to prove fraud as he alleged at the final settlement hearing. The Court therefore concluded the circuit court erred by reversing the probate court and rendering judgment in Hardin's favor. Accordingly, the circuit court was reversed and the matter remanded for further proceedings. View "Hardy ex rel. the Estate of Julius Carter, Sr. v. Hardin" on Justia Law

Aliant Bank appealed the entry of an injunction against it by the Shelby Circuit Court enjoining it from interfering with a contract for the sale of real property between Kimberly and Kerry Carter, on the one hand, and Gregory and Robyn Nunley, on the other. The Carters owned, as joint tenants, a piece of real property located in Shelby County. The Carters used the property to secure a mortgage from Mortgage Electronic Registration Systems, Inc. ("MERS"). In addition to the MERS mortgage, three creditors secured judgments against Kerry Carter against the property. Aliant was fourth to secure its judgment lien against Kerry Carter. On August 21, 2014, the Carters entered into a contract with the Nunleys for the sale of the property. At the time the Carters entered into the contract, the judgment liens against the property had not been satisfied. The preliminary settlement statement for the sale of the property indicated that a portion of the sale proceeds would be used to pay off the outstanding mortgage held by MERS on the property. The first judgment creditor thereafter agreed to release its judgment lien on the property in exchange for a smaller portion of the sale proceeds. The record did not indicate that the second or third judgment creditor agreed to release its judgment lien against the property. However, the record was clear that Aliant refused to release its judgment lien against the property. Apparently, Aliant's refusal to execute a release of its judgment lien inhibited the closing of the contract. On September 14, 2014, the Carters sued Aliant, alleging that Aliant had intentionally and maliciously refused to execute a partial release of the property "in order to prohibit [Kerry] Carter from being able to fulfill his obligations under the purchase contract even though all profits due Kerry Carter are being disgorged and paid to the appropriate judgment creditor, [the first judgment creditor]." The trial court granted an injunction against Aliant. Subsequently, Aliant petitioned the Alabama Supreme Court for a writ of mandamus directing the circuit court to vacate its injunction order. The Supreme Court treated Aliant's petition for a writ of mandamus as a timely notice of appeal. After the Supreme Court recharacterized Aliant's petition, Aliant filed its appellant's brief. Instead of filing an appellee's brief, the Carters moved to dismiss Aliant's petition as moot, alleging that the property had been foreclosed upon by MERS. The Carters did not present the Supreme Court with any evidence indicating that MERS had, in fact, foreclosed upon the property. Aliant opposed the motion to dismiss. After review, the Supreme Court agreed with the Carters that the injunctive relief they requested was no longer attainable and that, consequently, the case was no longer justiciable. Accordingly, the Supreme Court dismissed Aliant's appeal. View "Aliant Bank v. Carter" on Justia Law

Federal Insurance Company appealed a circuit court order denying its motion to compel arbitration of the breach-of-contract claim asserted against it by Kert Reedstrom. In 2008, Reedstrom entered into a written employment agreement with Marshall-Jackson Mental Health Board, Inc., d/b/a Mountain Lakes Behavioral Healthcare ("MLBHC"), to begin serving as its executive director in Guntersville. During the course of Reedstrom's employment with MLBHC, MLBHC held an executive-liability, entity-liability, and employment-practices-liability policy issued by Federal Insurance that generally protected certain MLBHC officers and employees described as "insureds" in the policy from loss for actions committed in the course of their employment with MLBHC. It was undisputed that Reedstrom was an "insured" covered by the Federal Insurance policy. The Federal Insurance policy contained an arbitration provision. A separate endorsement to the Federal Insurance policy further highlighted the arbitration provision and explained that its effect was that any disagreement related to coverage would be resolved by arbitration and not in a court of law. In July 2010, MLBHC terminated Reedstrom's employment and, in December 2010, Reedstrom sued MLBHC alleging that his termination constituted a breach of his employment contract. MLBHC asserted various counterclaims against Reedstrom based on his alleged misconduct while serving as executive director. Thereafter, Reedstrom gave Federal Insurance notice of the claims asserted against him and requested coverage under the terms of the Federal Insurance policy. Federal Insurance ultimately denied his claim and refused to provide him with counsel to defend against MLBHC's claims. A jury returned a verdict awarding Reedstrom $150,000 on his claim against MLBHC and awarding MLBHC $60,000 on its claims against Reedstrom. Consistent with its previous denial of his request for coverage, Federal Insurance refused Reedstrom's request to satisfy the judgment entered against him. Reedstrom sued Federal Insurance, asserting one claim of breach of contract and seeking $72,000 in damages ($60,000 for the judgment entered against him and $12,000 for the attorney fees he incurred in defending those claims). The Supreme Court reversed and remanded, finding that the trial court did not articulate its rationale for denying the motion to compel arbitration. The denial was apparently based on the court's resolving at least one of the arbitrability issues raised by Reedstrom in his favor and against Federal Insurance. However, because the subject arbitration provision delegated to the arbitrators the authority to resolve such issues, the trial court erred by considering the waiver and nonsignatory issues raised by Reedstrom instead of granting the motion to compel arbitration and allowing the arbitrators to resolve those issues. View "Federal Insurance Company v. Reedstrom" on Justia Law

Jeffrey Johnson, by a through his aunt and next friend, Sue Thompson, appeals from the Mobile Circuit Court's dismissal of his action against Jim Reddoch, in his official capacity as commissioner of the Alabama Department of Mental Health ("ADMH"), Beatrice McLean, in her official capacity as director of Searcy Hospital, and McLean and fictitiously named defendants 1 through 8 in their individual capacities. Johnson also appealed the circuit court's quashing of a subpoena served on ADMH seeking records pertaining to Johnson. Johnson was a 40-year-old patient at Searcy who suffered from paranoid schizophrenia. According to the complaint, Johnson's condition was so severe that Johnson was "required to be under constant 2-on-1 supervision by [ADMH] employees at Searcy Hospital." This supervision was supposed to be in place 24 hours a day, 7 days a week. In 2012, Johnson was severely beaten in his ward at Searcy. He collapsed and he was taken to University of South Alabama Hospital. Medical testing showed that, as a result of the beating, he suffered severe and life-threatening injuries, including internal bleeding, severe bruising to his face and body, a fractured nose, and several broken ribs. Johnson alleged Searcy's mental-health workers failed to keep him under the required constant supervision and failed to immediately report his injuries. After review of his complaint, the Alabama Supreme Court affirmed in part and reversed in part. The circuit court correctly dismissed Johnson's claims against Reddoch and McLean in their official capacities. The circuit court erred in dismissing Johnson's claims against McLean and the fictitiously named defendants in their individual capacities. The case was remanded for further proceedings, including consideration of Johnson's subpoena for discovery served on ADMH. View "Johnson v. Reddoch" on Justia Law

The City of Pike Road appealed a circuit court judgment holding that a manufacturing facility owned and operated by Dow Corning Alabama, Inc., located in Mt. Meigs, an unincorporated part of Montgomery County, was within the police jurisdiction of the City of Montgomery as opposed to the police jurisdiction of Pike Road. Finding no reversible error in that judgment, the Alabama Supreme Court affirmed. View "City of Pike Road v. City of Montgomery" on Justia Law