author: HARWOOD, Justice. SEE, Justice

text:
    Raymond CUSTER and Elizabeth Custer v. HOMESIDE LENDING, INC.
    1011409.
    Supreme Court of Alabama.
    March 14, 2003.

      W. Lewis Garrison, Jr., and W.A. Hop-ton-Jones, Jr., of Garrison, Scott, Gamble & Rosenthal, P.C., Birmingham; and Cecil G. Duffee III of Duffee & Associates, Birmingham, for appellants.
    John E. Goodman of Bradley Arant Rose & White, LLP, Birmingham; and John C. Englander of Goodwin Procter, LLP, Boston, Massachusetts, for appellee.
   HARWOOD, Justice.

Raymond Custer and his wife, Elizabeth, sued Homeside Lending, Inc. (“Homeside”), the current holder of a mortgage on residential property owned by the Custers, as well as WNC Insurance Services, Inc. (“WNC”), an insurance provider, on November 5, 1999. WNC had entered into a “Policy of Insurance Contract” with Homeside whereby WNC would “force-place” flood insurance for certain Homeside borrowers. Pursuant to this agreement, WNC agreed to bind coverage on properties encumbered by Home-side mortgages, and, if needed, to force-place flood insurance with certain underwriters. WNC had also entered into a “Servicing Agreement” with Homeside pursuant to which WNC agreed to provide flood audit services and Homeside agreed to purchase from WNC flood insurance Homeside forced-placed on the mortgages it serviced.

The action was filed as a class action pursuant to Rule 23, Ala. R. Civ. P., on behalf of a class of persons who, within the six-year period preceding the filing of the complaint, had had a mortgage loan serviced by Homeside and had had flood insurance force-placed under a WNC policy in an amount that exceeded the outstanding balance of their loans. As finally amended, the Custers’ complaint sought compensatory and punitive damages on claims of breach of contract, unjust enrichment, breach of duty of good faith and fair dealing, negligence, fraud by suppression, breach of a duty to a third-party beneficiary, and breach of an implied contract.

Homeside filed a motion for a summary judgment as to all claims with supporting evidentiary materials. The Custers filed a response and later filed a supplemental response. WNC then filed its own motion for a summary judgment, without opposition from the Custers, which the trial court granted. Thereafter, the trial court entered a partial summary judgment in favor of Homeside on all claims except the Cus-ters’ breach-of-express-contract claim and third-party-beneficiary claim, without stating its reasons for denying the summary-judgment motion as to those claims. Homeside then filed a “Motion for Reconsideration and Renewed Motion for Summary Judgment” on the breach-of-express-contract and third-party-beneficiary claims. Subsequently, the trial court reconsidered Homeside’s summary-judgment motion and, again without stating a rationale, entered a summary judgment on the case action summary sheet in favor of Homeside as to those claims as well. The trial court also denied class certification of the Custers’ claims. The Custers then appealed.

The record reveals that the Custers own a residence in Birmingham, Alabama, which they purchased in 1970, executing a purchase-money mortgage for $18,150 to Cobbs, Allen & Hall Mortgage Company, Inc. (“Cobbs, Allen & Hall”), located in Birmingham. The mortgage did not require the Custers to maintain flood insurance on the mortgaged property. However, the mortgage contained the following relevant provisions:

“THIS MORTGAGE IS MADE, however, subject to the following covenants, conditions, and agreements, that is to say:
“7. That [the Mortgagor] will keep the improvements now existing or hereafter erected on the mortgaged property, insured as may be required from time to time by the Mortgagee against loss by fire and other hazards, casualties and contingencies in such amounts and for such 'periods as may be required by the Mortgagee and will pay promptly, when due, any premiums on such insurance provision for payment of which has not been made hereinbefore.
“8. If the Mortgagor fails to insure said property as hereinabove provided, or to pay all or any part of the taxes or assessments levied, accrued, or assessed upon or against said property of the indebtedness secured hereby, or any interest of the Mortgagee in either, or fails to pay immediately and discharge any and all liens, debts, and/or charges which might become liens superior to the lien of this mortgage, the Mortgagee may, at its option, insure said property and/or pay said taxes, assessments, debts, liens, and/or charges, and any money which the Mortgagee shall have so paid or become obligated to pay shall constitute a debt to the Mortgagee additional to the debt hereby specially secured, shall be secured by this mortgage, shall bear legal interest from the date paid or incurred, and, at the option of the Mortgagee shall be immediately due and payable.”

(Emphasis added.) The record also shows that Homeside’s loan-servicing portfolio consists of loans it originated as well as loans it acquired from other entities, many of which date back to the 1970s. Thus, there is no single standard form mortgage in Homeside’s portfolio.

The Custer loan was transferred several times to various mortgage-loan-servicing companies over the course of its life; it was transferred to Homeside in 1989. At Homeside, the Custer loan became subject to the audits of Homeside’s loan portfolio designed to determine if any of the properties in the portfolio were within a special flood hazard area (“an SFHA”). In the ease of the Custers’ loan, WNC used the services of Z.C. Sterling Corporation (“Sterling”), a company that sometimes conducted independent audits on properties in Homeside’s loan portfolio. Once Sterling determined that a Homeside property was within an SFHA, it would notify WNC electronically, and a “binder” would be issued, to be later converted into a policy. In accordance with the “Policy of Insurance Contract” WNC had with Homeside, WNC would provide a binder, and if necessary, place the force-placed flood insurance with certain underwriters. The flood insurance force-placed on the Custers’ property was issued and bound pursuant to the “Policy of Insurance Contract” between Homeside and WNC. The “Servicing Agreement” between Homeside and WNC had no connection to the flood insurance that was force-placed on the Custers’ property. As stated in the deposition of Ofelia Chuante, the senior vice president in charge of compliance, underwriting and claims for WNC, during the period between 1993 and 2000, WNC issued approximately 6,000 force-placed flood-insurance policies on properties encumbered by mortgages serviced by Homeside as a result of Sterling’s audits.

Homeside executed a separate servicing agreement directly with Sterling, then known as American Sterling, on June 4, 1994. Pursuant to the terms of that agreement, Sterling notified WNC that the Custers’ property was deemed to be within an SFHA so that a binder could be issued.

Sterling sent notification letters to the Custers in April, May, and June 1999. The April 1999 letter, written on Homeside letterhead and as required by the National Flood Insurance Act, 42 U.S.C. § 4001 et seq. (“the NFIA”), stated, in pertinent part:

“Dear R M Custer,
“We recently completed a review of your loan file to ensure that our information is complete and accurate. Unfortunately, we found that your file does not contain a current flood insurance policy.
“Please help us to complete your file by giving us a copy of your current policy, or providing the information requested on the attached form within the next 60 days.”

(Emphasis in original.)

The Custers received a second letter, also written on Homeside letterhead, regarding flood insurance in May 1999; that letter stated, in relevant part:

“Dear R M Custer,
“About a month ago, you were notified by letter that your property is located in a federally-designated Special Flood Hazard Area (SFHA).[] Our mortgage loan guidelines and/or federal law require you to purchase flood insurance. Our letter further advised that if you did not respond within 60 days, we would purchase our own flood insurance and charge you for our premium and a nonrefundable service charge of $50.00, pursuant to the terms of your loan documents.
“Please note that we have not received an adequate response to our letter. Unless we receive a response within the next 30 days, we will purchase our own insurance and you will be charged accordingly. If you purchase your own insurance after the 30 day period, we will cancel our insurance and charge you only a prorated premium for the time our insurance was in effect.
“If you have not already purchased flood insurance, we encourage you to contact your local insurance agent. In most cases, your agent can provide insurance at the lowest cost available through the National Flood Insurance Program.
“NOTICE: IF WE MUST PURCHASE OUR OWN FLOOD INSURANCE BECAUSE OF YOUR FAILURE TO RESPOND TO THIS NOTICE, THE COST OF OUR INSURANCE MAY BE SIGNIFICANTLY HIGHER THAN THE COST OF INSURANCE PURCHASED THROUGH YOUR OWN AGENT. IN ADDITION, COVERAGE FOR YOUR PERSONAL PROPERTY CAN ONLY BE PURCHASED THROUGH YOUR AGENT.”

(Boldface in original.) The letter also contained a section that stated “Required Flood Insurance Amount: $79,000.”

Thereafter, the Custers contacted their insurance agent in an effort to procure flood insurance. However, as Ms. Custer testified in her deposition, the agent failed to procure the requested insurance within the 60-day time limit set by Homeside in its April 1999 letter to the Custers.

In late June 1999, the Custers received a third letter written on Homeside letterhead; that letter stated that Homeside had procured flood insurance on the Cus-ters’ property as required by the mortgage agreement and by federal law. The letter explained that Homeside had procured flood insurance on the mortgaged property in the amount of $79,000; that the annual premium was $667; and that that premium and a $60 nonrefundable service charge would be deducted from the Custers’ escrow account or billed to them. At the time Homeside force-placed the flood insurance on the Custers’ property, the outstanding loan balance was approximately $2,000. The insurance policy, obtained through WNC, stated, in pertinent part:

“A. Insurable Interest and Limit of Liability — It is understood and agreed that this Policy covers the insurable interest of the Insured and the Owner of the Dwelling, notwithstanding the insurable interest of any other person or persons in the Described Location.”

(Emphasis added.)

Subsequent to receiving this letter, the Custers decided to pay off the outstanding balance of their mortgage loan. In July 1999, they calculated the remaining balance and submitted to Homeside a check in the amount of $1,700.32. The complaint filed by the Custers in this action states that after receiving the Custers’ check, Homeside responded by letter, stating that in order to pay off the loan balance, the Custers would have to pay an additional $938.22 for hazard disbursement, which included $667 as the annual premium for flood insurance. The complaint also states that in “late July 1999,” the Custers made a “regular” payment in the amount of $205.67 on the loan. Several weeks later, as also indicated by the complaint, the Custers received a letter from Homeside stating that the amount necessary to satisfy the loan would be $197.98, which included earned premiums to date on the force-placed flood-insurance policy.

In an August 4, 1999, notice from WNC, the Custers were informed that the force-placed insurance had been in effect on their property from April 21, 1999, to July 20,1999, and that premiums of $214.02 had accrued on the policy. Thereafter, the Custers mailed a cashier’s check, on or about September 27, 1999, to Homeside in the amount of $218, which, the Custers assert in their complaint, paid the loan in full.

The Custers state in their initial brief to this Court that an understanding of the procedures and policies Homeside uses for determining the amount of insurance it chooses to force-place on the property of its borrowers is essential to their claim. The general procedure used by Homeside for determining the amount of flood insurance it force-places, as explained by the deposition testimony of Shelly Ward, a Homeside representative, takes into account the amount of hazard insurance the homeowner has in effect on the mortgaged property and the outstanding balance on the loan and uses the greater of the two as the amount of insurance coverage to be force-placed. In an affidavit, Donna Perry, a vice president at Homeside, attested, somewhat in contrast to the procedure described by Ward, that Homeside’s policy is to obtain flood insurance in the same amount as the borrower’s last known hazard insurance; if, however, the amount of hazard insurance is unknown, then the amount of force-placed flood insurance is equal to the outstanding loan balance. Perry explained that this policy is premised on the assumption that a borrower would want the same amount of protection against floods as against other hazards. In this case, in accordance with its policy, Homeside force-placed $79,000 worth of flood insurance on the mortgaged property because the Custers’ had $79,000 in hazard insurance on the property.

On appeal, the Custers first contend that the trial court committed reversible error in entering a summary judgment in favor of Homeside on their breach-of-express-contract claim because, they say, Homeside breached the mortgage agreement between it and the Custers, and similar mortgage agreements with putative class members, by force-placing flood insurance in amounts that exceeded outstanding mortgage loan balances, in violation of the NFIA. They secondly assert that they and the putative class members are third-party beneficiaries to the Home-side-WNC security agreement with respect to the insurance covering their equities in the insured properties, and therefore that they have standing to sue for breach of that agreement because, they argue, Homeside purchased excessive flood insurance. Further, the Cus-ters contend that the trial court exceeded its discretion in denying class certification on their claims because, they say, all the requirements of Rule 28(a) and (b)(3), Ala.R.Civ.P., have been met. They make no argument on appeal as to their other claims.

Our review of a summary judgment is de novo.

“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,’ Bussey v. John Deere Co., 531 So.2d 860, 862 (Ala.1988), and whether the movant was ‘entitled to a judgment as a matter of law.’ Wright v. Wright, 654 So.2d 542 (Ala.1995); Rule 56(c), Ala.R.Civ.P. When the movant makes a prima facie showing that there is no genuine issue of material fact, the burden shifts to the nonmovant to present substantial evidence creating such an issue. Bass v. SouthTrust Bank of Baldwin County, 538 So.2d 794, 797-98 (Ala.1989). Evidence is ‘substantial’ if it is of ‘such weight and quality that fair-minded persons in the exercise of impartial judgment can reasonably infer the existence of the fact sought to be proved.’ Wright, 654 So.2d at 543 (quoting West v. Founders Life Assurance Co. of Florida, 547 So.2d 870, 871 (Ala.1989)). Our review is further subject to the caveat that this Court must review the record in a light most favorable to the nonmovant and must resolve all reasonable doubts against the movant. Wilma Corp. v. Fleming Foods of Alabama, Inc., 613 So.2d 359 (Ala.1993) [overruled on other grounds by Bruce v. Cole, 854 So.2d 47 (Ala.2003) ]; Hanners v. Balfour Guthrie, Inc., 564 So.2d 412, 413 (Ala.1990).”

Hobson v. American Cast Iron Pipe Co., 690 So.2d 341, 344 (Ala.1997).

In this case, the significant facts are not in dispute. We consider both the applicable provisions of the NFIA and the terms of the mortgage agreement to determine whether Homeside was entitled to judgment as a matter of law as to the Custers’ claims.

Section 4012a(b) of the NFIA, “Requirement for mortgage loans,” which establishes the amount of flood insurance a borrower must maintain on property designated as being within an SFHA, before a lender may extend a loan secured by the property, states, in relevant part:

“(1) Regulated lending institutions
“Each Federal entity for lending regulation ... shall by regulation direct regulated lending institutions not to make, increase, extend, or renew any loan secured by improved real estate or a mobile home located or to be located in an area that has been identified by the Director [of the Federal Emergency Management Agency] as an area having special flood hazards and in which flood insurance has been made available under the National Flood Insurance Act of 1968 ..., unless the building or mobile home and any personal property securing such loan is covered for the term of the loan by flood insurance in an amount at least equal to the outstanding principal balance of the loan or the maximum limit of coverage made available under the Act with respect to the particular type of property, whichever is less.”

(Emphasis added.) Section 4012a(e) of the NFIA, which grants a lender the statutory authority to force-place flood insurance on a borrower, states, in pertinent part:

“(1) Notification to borrower of lack of coverage
“If, at the time of origination or at any time during the term of a loan secured by improved real estate or by a mobile home located in an area that has been identified by the Director [of the Federal Emergency Management Agency] (at the time of the origination of the loan or at any time during the term of the loan) as an area having special flood hazards and in which flood insurance is available under the National Flood Insurance Act of 1968 ..., the lender or servicer for the loan determines that the building or mobile home and any personal property securing the loan is not covered by the flood insurance or is covered by the insurance in an amount less than the amount required for the property pursuant to paragraph (1), (2), or (3) of subsection (b)[] of this section, the lender or servicer shall notify the borrower under the loan that the borrower should obtain, at the borrower’s expense, an amount of flood insurance for the building or mobile home and such personal property that is not less than the amount under subsection (b)(1) of this section, for the term of the loan.

“(2) Purchase of c overage on behalf of the borrower

“If the borrower fails to purchase flood insurance within 45 days after notification under paragraph (1), the lender or servicer for the loan shall purchase the insurance on behalf of the borrower and may charge the borrower for the cost of premiums and fees incurred by the lender or servicer for the loan in purchasing the insurance.”

(Emphasis added.)

The Custers urge this Court to follow the reasoning of the Louisiana Court of Appeals in Norris v. Union Planters Bank, 739 So.2d 869 (La.Ct.App.1999)— that the NFIA establishes a maximum amount of flood insurance a mortgagee may force-place on a mortgagor. In Norris, the mortgagors were obligated, pursuant to the terms of a mortgage agreement with the mortgagee, to maintain flood insurance on the mortgaged property after it was determined that the property was within an SFHA. That determination was made several years after the parties entered into the mortgage agreement; upon the mortgagor’s failure to procure flood insurance following appropriate notices, the mortgagee, in accordance with 42 U.S.C. § 4012a(e)(2), force-placed flood insurance on the mortgaged property in the amount of $121,000, although the original amount of the mortgage loan was $74,750 and the loan balance at the time of the force-placement was $60,913.56. The mortgagors sued, seeking a declaratory judgment, and challenging the amount of coverage, because it exceeded the outstanding balance of the loan. The trial court entered a summary judgment in favor of the mortgagee; the mortgagors appealed. They contended that 42 U.S.C. § 4012a(b)(l) limited the amount of insurance that might be force-placed to “ ‘an amount at least equal to the outstanding principal balance of the loan or the maximum limit of coverage made available under the Act with respect to the particular type of property, whichever is less,’ ” Norris, 739 So.2d at 873 (quoting 42 U.S.C. § 4012(a)(b)(l)). Consequently, they argued, the mortgagee’s procurement of insurance coverage in the amount of $121,000, despite the fact that the outstanding balance of their loan was only $60,913.56, violated the NFIA. The Louisiana Court of Appeals stated:

“The limited jurisprudence on this subject guides our determination of this issue. As the United States Seventh Circuit Court of Appeals commented:
“ ‘[A]n analysis of the legislative history and purpose indicates that the primary purposes behind the Flood Program was to diminish, by implementation of sound land use practices and flood insurance, the massive burden on the federal treasury of escalating flood disaster assistance. Federally supervised mortgage lenders also benefit, especially from the requirement of Section 4012a(b) that borrowers purchase flood insurance in the amount of the loan. It is obvious that Congress also intended borrowers to benefit from both Section 4012a(b) and the notice provision of Section [4104a], but the Flood Program is primarily concerned with protecting the federally supervised and insured lenders since the flood insurance purchase requirement of Section 4012a(b) extends only to the amount of the outstanding loan balance and not the borrower’s equity.’
“Mid-America National Bank of Chicago [v. First Savings & Loan Ass’n of South Holland ], 737 F.2d [638] at 642-43 [ (7th Cir.1984) ].
“Accordingly, we find as a matter of law, Union Planters purchased more flood insurance than they were authorized to purchase under the Act. We disagree with Union Planters’ assertion that the Act establishes a minimum threshold of insurance coverage, but rather, our interpretation of the Act is consistent with the federal courts in Mid-America National Bank of Chicago, 737 F.2d at 642-43, and Hofbauer v. Northwestern National Bank of Rochester, Minnesota, 700 F.2d 1197, 1200 (8th Cir.1983), which find that flood insurance under 42 U.S.C.A. § 4012a(b) requires flood insurance for the amount of the outstanding loan balance and not the equity of the borrower.”

739 So.2d at 874. The Norris court relied on two federal cases for “guidance” in reaching the conclusion that the NFIA establishes a maximum amount of insurance coverage that a lender could force-place on a borrower. Accordingly, we also examine those two cases.

In Mid-America National Bank of Chicago v. First Savings & Loan Association, 737 F.2d 638 (7th Cir.1984), 11 plaintiffs sued 27 federally chartered or insured commercial banks and savings and loan associations. The plaintiffs’ theory of liability against the defendants was summarized as follows:

“Plaintiffs claim that defendants violated 42 U.S.C. § 4104a by fading to notify plaintiffs of the flood risk when plaintiffs acquired their loans, and that defendants violated 42 U.S.C. § 4012a(b) by failing to require plaintiffs to purchase flood insurance to the extent of the loan amounts. Plaintiffs’ property suffered flood damage, and plaintiffs assert their losses were uninsured. Although the above provisions do not expressly create a federal cause of action in favor of borrowers against mortgage lenders, plaintiffs seek to hold defendants liable for losses and claim that an implied private right of action exists under Section 4012a(b) and 4104a of the Flood Program.”

737 F.2d at 639.

In the process of its analysis, the United States Court of Appeals for the Seventh Circuit reviewed the sequential federal legislation establishing and refining the flood insurance program. The court concluded that “an analysis of the legislative history and purpose indicates that the primary purpose behind the Flood Program was to diminish, by implementation of sound land use practices and flood insurance, the massive burden on the federal treasury of escalating federal disaster assistance.” 737 F.2d at 642 (footnote omitted). The opinion noted the findings of a report of the House of Representatives explaining the purposes and objectives of the federal flood program:

“ ‘Heavy losses over the years from hurricanes in the coastal areas and from storms in inland areas of the Nation dramatize the lack of insurance protection against flood damage. Insurance protection against the risk of destruction caused by tornados and other natural catastrophes is generally available, but it is not available against the risk of flood loss.
“ ‘Communities along the seacoast or in a river basin become completely immobilized following a major flood. Usually they must depend on the Federal Government and voluntary relief agencies to provide various forms of assistance. Some State and local governments have limited programs to assist a flood-stricken area, but disaster relief from all of these sources is inadequate to provide for the necessary restoration of heavily damaged areas. These facts underline the need for a program which will make insurance against flood damage available, encourage persons to become aware of the risk of occupying the flood plains, and reduce the mounting Federal expenditures for disaster relief assistance.’ (emphasis added [in Mid-America ]).”

737 F.2d at 643 n. 9 (quoting H.R. Report No. 1585 (1968)).

The court concluded that no implied federal private cause of action existed under the circumstances of the case. As a part of its analysis, the court correctly noted that the “flood insurance purchase requirement of Section 4012a(b) extends only to the amount of the outstanding loan balance and not the borrower’s equity .” 737 F.2d at 643 (emphasis supplied). This is not the same, however, as saying that the requirement, which Section 4012a(b) phrases in terms of being “in an amount at least equal to” the loan balance or the maximum coverage available under the Act, sets a ceiling as opposed to a floor. In fact, given that the “primary purpose” of the flood-program legislation is to reduce the massive burden on the national treasury resulting from escalating federal expenditures for flood-disaster relief assistance, it can be logically argued that Congress would not be adverse to the contractual procurement of force-placed insurance covering the full value of the property. After all, the obligation borne by the federal treasury for flood-disaster relief assistance to homeowners of properties damaged or destroyed by flooding may well extend beyond the balance of any mortgage loan encumbering them. See Peal v. North Carolina Farm Bureau Mut. Ins. Co., 212 F.Supp.2d 508, 513 (E.D.N.C.2002)(discussing the federal caselaw recognizing that under federal emergency management programs, “the federal treasury pays all flood insurance claims exceeding the revenue earned by [private insurance] companies from premium collection”).

In Hofbauer v. Northwestern National Bank of Rochester, 700 F.2d 1197 (8th Cir.1983), cited by Norris, supra, and Mid-America, supra, the United States Court of Appeals for the Eighth Circuit determined that there was no implied federal cause of action for uninsured flood damage sustained by a home mortgagor, even though the mortgagee bank had not given the federally required notice of flood hazard and had not required the purchase of flood insurance. In determining that borrowers were not a special class for whose benefit the federal legislation required flood-hazard notification and the purchase of flood insurance, the Hofbauer court observed:

“The specific statutes in question were not enacted for the special benefit of the borrowers. Section 4012a(b) requires flood insurance for the amount of the outstanding loan balance and not for the equity of the borrower. If Congress had passed the statute primarily for the benefit of the borrowers, it would have required that they insure their equity in the home. This statute seems primarily concerned with protecting lenders, not borrowers.”

700 F.2d at 1200.

As noted previously, the federal requirement that flood insurance be purchased for an amount at least equal to the amount of the outstanding loan balance, with no concomitant requirement that borrowers also insure the equity in their homes, does not imply any congressional intention to prevent the lender and borrower from contractually agreeing that there should be insurance coverage for that equity. For all that appears in the opinions in Norris, Midr-America, and Hofbauer, there was no counterpart provision in the mortgages involved in those cases to the one involved in this case, pursuant to which the Custers agreed to keep the property insured against loss “by fire or other hazards, casualties and contingencies in such amounts ... as may be required by the Mortgagee” and further agreed that the mortgagee could force-place such insurance if the Custers failed to obtain it themselves.

This Court looks to federal court decisions as an aid in interpreting federal statutes when there is federal caselaw on point. J.C. Bradford & Co. v. Vick, 837 So.2d 271 (Ala.2002). However, the parties have not cited any applicable federal authority discussing the meaning of 42 U.S.C. § 4012a(b) as it relates to the Cus-ters’ claims, and our research has unearthed no authority on point. Likewise, the parties have cited no relevant state-court holdings. Therefore, as we would do anyway as the first step in construing a statute, we focus on the language of the statute.

“When a court construes a statute, ‘[w]ords used in [the] 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.’ ” Lyons v. Norris, 829 So.2d 748, 751 (Ala.2002) (quoting IMED Corp v. Systems Eng’g Assocs. Corp., 602 So.2d 344, 346 (Ala.1992)). See also Ex parte Alabama Dep’t of Mental Health & Retardation, 840 So.2d 863 (Ala.2002); Bassie v. Obstetrics & Gynecology Assocs. of Northwest Alabama, P.C., 828 So.2d 280 (Ala.2002); City of Orange Beach v. Benjamin, 821 So.2d 193 (Ala.2001). As stated earlier in the opinion, the critical language in 42 U.S.C. § 4012a(b)(l) requires flood insurance “in an amount at least equal to the outstanding principal balance of the loan.” (Emphasis added.) That qualified phrasing is reiterated by the requirement in § 4012a(e) that the borrower be notified of his obligation to obtain flood insurance that is “not less” than the amount required by subsection (b)(1). “A statute must be considered as a whole and every word in it made effective if possible.” Alabama State Bd. of Health v. Chambers County, 335 So.2d 653, 654-55 (Ala.1976), citing State By and Through State Board for Registration of Architects v. Jones, 289 Ala. 353, 267 So.2d 427 (1972). See also Hawkins v. Louisville & Nashville R.R., 145 Ala. 385, 40 So. 293 (1905). The construction given to § 4012a(b)(l) by the court in Norris did not accord any meaning to the phrase “at least” appearing in that section. We conclude that it is appropriate in construing 42 U.S.C. § 4012a(b) to give that phrase meaning. “ ‘At least’ means a minimum of and must be at least equalled. Something substantially equal is not enough.” Hall v. Dawson, 429 S.W.2d 366, 368 (Ky.1968).

“ ‘At least’ is an adverbial phrase meaning at the lowest estimate; at the smallest concession or claim; in the smallest or lowest degree; at the smallest number; and sometimes used in the sense of clearly. It is a phrase of emphasis, expressive of a minimum, and implies the possibility of more.”

Barron v. Green, 13 N.J.Super. 483, 485-86, 80 A.2d 586, 587 (1951) (emphasis added). See also Schmeckpeper v. Panhandle Co-op. Ass’n, 180 Neb. 352, 143 N.W.2d 113 (1966); Santow v. Ullman, 39 Del.Ch. 427, 434, 166 A.2d 135, 139 (1960) (“In any event the sufficient answer is that the natural import of the phrase ‘at least’ is ... to express the idea of a minimum and nothing more”) (emphasis added). Based on the language of § 4012a(b)(l) — “at least equal to the outstanding principal balance of the loan” — and the language of § 4012a(e)(l) — “not less than the amount under subsection (b)(1)” — we conclude that the NFIA establishes that the minimum, not the maximum, amount of flood insurance coverage that may be force-placed on a mortgagor by a mortgagee is that amount equal to the outstanding principal on the mortgagor’s loan. We therefore decline to adopt the rationale of Norris.

As earlier stated, the outstanding principal on the Custers’ loan at the time Homeside force-placed flood insurance on the mortgaged property was approximately $2000. Therefore, the minimum amount of flood insurance that Homeside could have force-placed on the Custers’ property was $2000. Homeside force-placed flood insurance in the amount of $79,000. In so doing, Homeside satisfied the minimum force-placement requirements of the NFIA. Contractually, it was given the right to force-place a higher amount, under the provisions of the mortgage authorizing it to force-place insurance against loss “in such amounts” as it might choose to require.

We next consider whether the terms of the mortgage agreement between Homeside and the Custers concerning the amount of insurance that might be required by Homeside permitted Homeside to force-place flood insurance in the amount of $79,000. Under Alabama law, mortgage agreements are enforced as written, barring some contravention of public policy. For example, in Hampton v. Gulf Federal Savings & Loan Association, 287 Ala. 172, 249 So.2d 829 (1971), the mortgagor sued the mortgagee, alleging that the mortgagee had failed to insure the mortgaged property, after the mortgagee instituted foreclosure proceedings, in an amount equal to the value of the mortgage, as had been done in the past by the mortgagor. The mortgage agreement obligated the mortgagor “[t]o continuously maintain hazard insurance, of such type or types and amounts as [the] Mortgagee may from time to time require,” 287 Ala. at 174, 249 So.2d at 830. The Hampton Court stated:

“Under the language of the mortgage, the right of [the mortgagee] to fix the amount of the insurance was absolutely discretionary at any time. It had the right to determine, unilaterally, the amount of the insurance and even had the right under the provisions of said mortgage to reduce the coverage to zero .”

287 Ala. at 176, 249 So.2d at 883. The Court also stated:

“Here, the language of the mortgage confers upon the mortgagee complete discretion pertaining to the amount of insurance and the right to change such amount ‘from time to time.’ Therefore, this court holds that under the language of the mortgage, [the mortgagee] was under no duty to keep the insurance on the mortgaged property in the amount previously maintained.”

287 Ala. at 176-77, 249 So.2d at 888. In light of the terms of the mortgage agreement in this case, and applying this Court’s holding in Hampton, we conclude that Homeside did not breach the terms of the mortgage agreement between it and the Custers by force-placing flood insurance in an amount that exceeded the outstanding principal on the Custers’ loan.

In addition, we note that the Custers were notified by Homeside on three separate occasions that their property was subject to the force-placement of flood insurance. Contained in one of those notices was a statement that the amount of insurance Homeside intended on force-placing on the Custers’ property in the event they did not procure flood insurance on their own would be $79,000, the amount eventually implemented. The Custers were also informed that they could procure flood insurance from their personal insurance agent at a cost that might be “significantly” less than the cost of any such insurance if Homeside purchased it. Although the Custers did contact their personal agent in an attempt to procure flood insurance after they were contacted by Homeside, they did not take steps necessary to ensure that their agent followed through with their request to obtain the required insurance within the 60-day time limit imposed by Homeside, which, in turn, exceeded the 45-day time limit prescribed by 42 U.S.C. § 4012a(e)(2). The Custers knew that they had the option of obtaining their own flood insurance, and they failed to exercise that option.

The Custers further contend that the trial court’s ruling allows a mortgagee to force-place insurance on a mortgagor’s property in an amount that exceeds the mortgagee’s insurable interest, thereby creating a wagering contract. “[Wjhatever furnishes a reasonable expectation of pecuniary benefit from the existence of the subject of insurance is a valid insurable interest.” Pacific Nat’l Fire Ins. Co. v. Watts, 266 Ala. 606, 610, 97 So.2d 797, 801 (1957). “ "Whoever ... may fairly be said to have a reasonable expectation of deriving pecuniary advantage from the preservation of the subject-matter of insurance, whether that advantage inures to him personally or as the representative of the rights or interests of another, has an insurable interest.’ ” American Equitable Assur. Co. of New York v. Powderly Coal & Lumber Co., 221 Ala. 280, 282, 128 So. 225, 226 (1930) (quoting American Ins. Co. v. Newberry, 215 Ala. 587, 112 So. 195, 196 (1927)). “A mortgagor and a mortgagee each have an independent insurable interest in the property covered by the mortgage, and both interests may be covered by one policy.” 3 Lee R. Russ & Thomas F. Segalla, Couch on Insurance § 42:28, at p. 42-35 (3d. ed.1997).

In this case, the insurable interests of both Homeside and the Custers were covered by the flood-insurance policy WNC obtained on behalf of the Custers. In their brief, the Custers acknowledge that any proceeds payable on the policy in excess of the amount owed to Homeside would be paid to them, stating: “To be sure, any proceeds from a force placed flood policy over and above the loan balance would be paid to the mortgagor.” Homeside was acting as the Custers’ agent to the extent it procured coverage for their equity interest in the property; Homeside had no incentive to injure or destroy the property (to the extent that a flood could be precipitated by human means), because all insurance proceeds over the loan balance, whatever they might be at any given time, indisputably would go to the Custers. Homeside’s interest in the property was, in turn, protected only to the extent of the outstanding loan balance. Thus, while Homeside did insure the Custers’ property in a manner that exceeded its insurable interest, it did so pursuant to contractual terms agreed to by both it and the Cus-ters, and it did not insure the property in an amount that exceeded the total insurable interest in the property. We cannot conclude that Homeside’s procurement of insurance designed to cover both its and the Custers’ respective insurable interests represented an invalid wagering contract.

The Custers also argue that they are third-party beneficiaries to the “servicing agreement” between Homeside and WNC. In support of their argument, the Custers refer the Court to Holley v. St. Paul Fire & Marine Ins. Co., 396 So.2d 75 (Ala.1981). In that case, this Court, after considering the surrounding circumstances of the parties to the contract, as allowed by Anderson v. Howard Hall Co., 278 Ala. 491, 179 So.2d 71 (1965), and Zeigler v. Blount Brothers Construction Co., 364 So.2d 1163 (Ala.1978), concluded that a complainant could be a third-party beneficiary to a contract even though the complainant was not specifically considered in the contract.

To establish a claim of third-party-beneficiary entitlement, a claimant must show: “ ‘ “(1) that the contracting parties intended, at the time the contract was created, to bestow a direct benefit upon a third party; (2) that the complainant was the intended beneficiary of the contract; and (3) that the contract was breached.” ’ ” H.R.H. Metals, Inc. v. Miller, 833 So.2d 18, 24 (Ala.2002) (quoting McGowan v. Chrysler Corp., 631 So.2d 842, 848 (Ala.1993)). At the outset, we note that the Custers have not shown how the servicing agreement between Homeside and WNC, as opposed to the “Policy of Insurance Contract,” applies to their case, in light of the fact that the Custers’ policy was force-placed under the latter agreement.

Even assuming that the servicing agreement has some application, however, we note that the Custers have presented arguments in support of this theory only as to the first two prongs of third-party-beneficiary status. They do not argue or explain in either their principal brief or their reply brief how the servicing agreement between Homeside and WNC was breached; our review of the evidence does not reveal any breach of that agreement. Further, the servicing agreement deals only with the discretion of Homeside to protect its interest — the agreement is neutral as to whether Homeside may force-place flood insurance in an amount that protects not only its interest but also that of the borrower. Because of the neutrality of the agreement on that point, we cannot conclude that on its face the agreement was intended to confer a benefit on borrowers. “[T]he court’s inquiry may stop when it determines from the face of the contract that the parties did not intend to confer upon the third person a direct benefit.” Collins Co. v. City of Decatur, 533 So.2d 1127, 1132 (Ala.1988).

Additionally, because Homeside had the contractual right under the mortgage agreement to exercise its discretion in deciding whether to insure a mortgaged property only to the extent of its interest in the property, or to insure also the borrower’s interest, any benefit received by the Custers would have been merely incidental, thereby precluding a third-party-beneficiary claim. Stacey v. Saunders, 437 So.2d 1230 (Ala.1983) (plaintiffs were not third-party beneficiaries of an antenuptial agreement entered into by their mother and her intended husband with respect to a trust designed to pay the wife income for her life and give her “ ‘a power to appoint by will to her estate, or to such persons as she may elect, the entire corpus and any undistributed income of the trust.’ ” 437 So.2d at 1232. In refusing to recognize the plaintiffs as third-party beneficiaries of that provision, this Court reasoned, “[a]ny benefit to Plaintiffs was, if anything, merely incidental, and depended solely upon [their mother’s] discretionary power of appointment by will.” 437 So.2d at 1233.). We conclude that the Custers did not satisfy the requisite elements of their third-party-beneficiary claim. Accordingly, the trial court did not err by entering a summary judgment for Homeside as to the Custers’ third-party-beneficiary claim.

Consequently, the trial court’s judgment is affirmed in all respects. Because we hold that the trial court did not err by entering a summary judgment for Home-side on all of the Custers’ claims, we need not address the issue of class certification.

For the foregoing reasons, the judgment of the trial court is affirmed.

AFFIRMED.

MOORE, C.J., and BROWN and STUART, JJ., concur.

SEE, J., concurs in the rationale in part and concurs in the result.

SEE, Justice

(concurring in the rationale in part and concurring in the result).

I concur with the main opinion that the mortgage agreement provided that the lender was entitled to determine the types and amounts of hazard insurance the Cus-ters were required to keep on the property, and that the lender could force-place insurance if the Custers failed to adequately insure the property. The National Flood Insurance Act (“the NFIA”) does not prohibit private parties from making and enforcing such an agreement in an amount that exceeds the lender’s exposure. See 42 U.S.C. § 4012a. I, therefore, do not reach the question whether the NFIA affirmatively authorizes a mortgage lender to force-place flood insurance in an amount greater than the lender’s exposure in a mortgage.

      .The National Flood Insurance Act, 42 U.S.C. § 4001 et seq., requires homeowners with mortgages on property in designated flood zones to carry flood insurance on that property. It also authorizes a mortgagee, in the event the mortgagor fails to procure flood insurance on his or her own accord, to obtain flood insurance for the mortgaged property and to charge the cost back to the mortgagor, thereby "force-placing” the insurance.

      . The audit services performed by WNC consisted of WNC’s monitoring Homeside’s loan portfolio to determine when and if particular Homeside properties came within a "special flood hazard area,” as identified by the Federal Emergency Management Agency, thereby requiring flood insurance under the National Flood Insurance Act.

      . WNC is not a party to this appeal.

      . Neither the Custers nor Homeside defines "binder.” However, Couch On Insurance defines a binder as "a written contract by a duly authorized agent of an insurance company recognizing liability on a forthcoming contract during negotiations for such contract.” 1 Lee R. Russ & Thomas F. Segalla, Couch On Insurance § 13.1, p. 13-5 (3d ed.1997) (footnote omitted). A binder acts as temporary insurance upon the application for insurance or the payment of the first premium that insures the applicant during the insurance company’s investigation of insurability. Id. at p. 13-2.

      . Under this servicing agreement Sterling conducted audits of Homeside’s loan portfolio to determine if any of the properties in the portfolio required flood insurance.

      . The record does not specifically state the date on which Sterling notified WNC that the Custers' property was in an SFHA; however, as Ofelia Chuante testified, WNC is notified electronically when Sterling sends its first letter to a borrower.

      . 42 U.S.C § 4012a(e)(l) requires the lender to notify the borrower that the borrower should, at his or her own expense, procure flood insurance on the borrower's property when that property is identified by the director of the Federal Emergency Management Agency as being within an SFHA.

      . The record does not indicate what changes might have occurred to cause the property's reclassification so that it was within an SFHA.

      . 42 U.S.C § 4012a(e)(2) allows a mortgagee to force-place flood insurance, and to charge the cost of the insurance to the mortgagor, if the mortgagor fails to procure such insurance within 45 days of its being notified of the need for the insurance, as required under 42 U.S.C § 4012a(e)(l).

      . The record does not provide an explanation for the discrepancy in the amount of premiums that had accrued as per Home-side’s August 4, 1999, notice and the amount the Custers paid on or about September 27, 1999, to satisfy the loan.

      . Pursuant to 44 C.F.R. § 61.6, the maximum amount of coverage the NFIA permits for a single-family residence under the National Flood Insurance Program, a federally subsidized program that provides flood insur-anee, is $250,000. The NFIA does not, however, establish a maximum for insurance not "made available under the Act,” i.e., not purchased as part of the National Flood Insurance Program.

      . Only paragraph (1), which has been previously quoted, is applicable to the present facts.

      . We note that the mortgage contract in this case specifically permits Homeside to require insurance for loss against "other hazards,” "other casualties,” and "other contingencies,” terms the Custers do not contend would not include floods. See also Weninegar v. S.S. Steele & Co., Inc., 477 So.2d 949 (Ala.1985); Jefferson County v. Johnson, 333 So.2d 143 (Ala.1976); and Law v. Gulf States Steel Co., 229 Ala. 305, 156 So. 835 (1934)(cases discussing floods as "hazards”).

      . "A wager policy of insurance has been defined as a pretended insurance where the insured has no interest in the insured subject and cannot sustain any loss by the happening of the misfortunes insured against.” 43 Am. Jur.2d Insurance § 939 at 964 (1982) (footnote omitted).
      "[T]he reason for the rule most commonly assigned is that if the insured has no insurable interest in the property insured, the insured is wagering that a loss or damage will occur and the insurer is wagering that it will not, thereby supplying the insured with an incentive to injure or destroy the insured property, which is against public policy.”

        National Sec. Fire & Cas. Co. v. Brannon, 47 Ala.App. 319, 324, 253 So.2d 777, 781 (1971); Brewton v. Alabama Farm Bureau Mut. Cas. Ins. Co., 474 So.2d 1120 (Ala.1985).


source: Caselaw Access Project

author: WOODALL, Justice.

license: Public Domain

text:
    Helen LEE d/b/a American Quality Service a/k/a American Quality Service of Tennessee v. YES OF RUSSELLVILLE, INC., et al. Helen Lee d/b/a American Quality Service a/k/a American Quality Service of Tennessee v. YES of Russellville, Inc., et al.
    1011691 and 1011692.
    Supreme Court of Alabama.
    March 14, 2003.

      William D. Jones III and Susan T. Spence of Johnston Barton Proctor & Powell, LLP, Birmingham; and R. Eric Summerford, Decatur, for appellant.
    Richard J.R. Raleigh, Jr., and S. Dagnal Rowe of Wilmer & Lee, P.A., Huntsville; Robert I. Rogers and Jeffrey L. Bowling of Bedford, Rogers & Bowling, P.C., Rus-sellville, and Luther M. Dorr, Jr., of Maynard, Cooper & Gale, P.C., Birmingham, for appellee Community Spirit Bank.
   WOODALL, Justice.

These appeals arise out of proceedings in the Franklin Circuit Court after a prior appeal of this case. See Lee v. YES of Russellville, Inc., 784 So.2d 1022 (Ala.2000) (“Lee 7”), in which this Court affirmed the trial court’s order denying Helen Lee’s motion to compel arbitration and set out some principles of law to guide the trial court in further proceedings in the case. The appeal in Lee I was from the denial of Lee’s motion to compel arbitration and to stay proceedings pending mediation/arbitration of a dispute between American Quality Service a/k/a American Quality Service of Tennessee (“AQS”), YES of Russellville, Inc. (“YES”), Naren-dra Sheth, and Community Spirit Bank (“the Bank”) (YES, Sheth, and the Bank are hereinafter referred to collectively as “the Owners”). One of the issues to be decided in the further proceedings was the nature of the relationship between AQS, Helen Lee, and Joseph Hemingway. This appeal is from a judgment entered against Lee and Hemingway and in favor of the Owners. We affirm.

Most of the facts underlying this dispute were set forth in Lee I. One action began on October 14, 1999, when a complaint was filed by YES and Sheth against “Joseph Hemingway, individually, and d/b/a American Quality Service” (case no. CV-99-224). The complaint sought damages under theories of breach of contract to construct a Holiday Inn Express hotel and slander of title. On October 28, 1999, a complaint was filed by “Joseph Hemingway, d/b/a American Quality Service,” against YES and Sheth “to establish a lien” on property owned by YES and/or Sheth (case no. CV-99-240). That complaint also sought to recover $852,000 “for work and improvements done on the property of the defendants],” in counts for breach of contract and money “due on open account.”

The Bank intervened on January 25, 2000. Its interest in the dispute arises out of a mortgage it holds, securing the debt incurred by YES for construction of the hotel. As Lee and Hemingway explain it:

“Pursuant to [Ala.Code 1975,] § 35-ll-211(a), a mechanic’s lien on property and improvements has priority over all other liens, mortgages or encumbrances created after the builder begins work on the improvements. [AQS] began work on the hotel construction project in October 1998. Sheth and/or YES of Rus-sellville gave Community Spirit Bank a mortgage on the property in December 1998. Accordingly, Lee’s mechanic’s lien has priority over the bank’s mortgage unless [the lien] is invalid — hence the bank’s strenuous contentions that Lee is not a party to the construction contract and that Hemingway was an unlicensed general contractor and has no remedies against Sheth or YES of Russellville.”

Brief of Appellants, at 5 n. 2. The actions were treated as though they were consolidated.

YES and Sheth filed a joint motion for a summary judgment, arguing that Hemingway had failed to comply with the licensing requirements of Ala.Code 1975, § 84-8-1 et seq., relating to general contractors, and, consequently, that the construction contract was unenforceable. “While that motion was pending, Helen Lee moved to amend the complaint to substitute herself as plaintiff. She contended that [AQS] was a trade name under which she operated a sole proprietorship and that Hemingway had acted as her agent in dealing with YES and Sheth.” Lee I, 784 So.2d at 1024-25 (emphasis added). It is undisputed that at all relevant times, Lee possessed a valid general contractor’s license. The trial court granted Lee’s motion to substitute herself as plaintiff and denied the summary-judgment motion. However, the trial court denied Lee’s motion to stay the proceedings pending mediation/arbitration; hence, the first appeal.

In affirming the order denying Lee’s motion to stay the proceedings pending mediation/arbitration, we said:

“We emphasize that the question of agency is only a threshold issue. If a jury determines that an agency relationship did not exist, then the contract would be void because Hemingway was not a licensed general contractor. White v. Miller, 718 So.2d 88, 89 (Ala.Civ.App.1998) (‘It is well settled that “[e]xpress or implied contracts entered into by an unlicensed general contractor are null and void because they violate public policy.” ’). However, if the jury determines that the agency relationship did exist, and thus that Lee is a valid party to the contract, the dispute must proceed to arbitration.”

Lee I, 784 So.2d at 1028.

After the first appeal, the trial court made factual determinations involving the relationship of AQS with Lee and Hemingway, based on evidence presented ore ten-us. The trial court found the testimony of Lee and Hemingway to be incredible. On the basis of the “right-of-eontrol test,” applied in Thrash v. Credit Acceptance Corp., 821 So.2d 968, 972 (Ala.2001), the trial court found “that Joseph Hemingway acted as the ‘principal’ and [was] in fact that individual acting as the general contractor responsible for the construction of the hotel in question in Russellville, Alabama.” Consequently, the court held that the contract between YES/Sheth and AQS was void. The court entered a judgment in favor of the Owners and made the judgment final, pursuant to Ala. R. Civ. P. 54(b).

Lee and Hemingway filed a motion to alter, amend, or vacate the judgment or, in the alternative, for a new trial. From the denial of that motion, they appealed. On appeal, Lee and Hemingway contend that the trial court erred to reversal in applying the right-of-control test and in finding that “Lee exercised insufficient control over the actions of Hemingway.” Brief of Appellants, at 20. Thus, this appeal presents two issues, one of law and one of fact, namely, (1) whether the trial court applied the correct test to those facts, and, if so, (2) whether the evidence supports its findings.

I. The Test

In Thrash, this Court said:

“ ‘Agency is generally a question of fact to be determined by the trier of fact.... The test to be applied in determining whether there existed an agency relationship based on actual authority is whether the alleged principal exercised a right of control over the manner of the alleged agent’s performance. Control must be proven; and proof of control requires more than proof of a mere right to determine if the person claimed to be an agent is conforming to the requirements of a contract.... ’
“(Emphasis added [in Thrash].) The right-of-control test requires that the right be reserved, not that the right be actually exercised.”

821 So.2d at 972.

Here, the trial court noted a peculiarity of this dispute, stating:

“Ordinarily, the principal is attempting to disavow any relationship with an alleged agent in light of a third party’s attempts to tag the principal with the consequences of some action of the agent. It is undisputed that the case at bar cannot be classified as ‘ordinary.’ Here, the third parties (i.e., YES and/or Community Spirit Bank) assert the true ‘facts of the relationship’ reflect that Joseph Hemingway was doing business for himself and asserted himself as the entity known as AQS.”

(Emphasis added.)

Lee and Hemingway argue that the issue is whether Lee authorized Hemingway to execute the contract with YES/Sheth. More specifically, they contend:

“The ‘right-of-control’ test, with its inquiry into the degree of control that the alleged principal exercised over the alleged agent, is not appropriate in the context of the present case. In the present case, the principal, Helen Lee, is not trying to avoid her responsibilities as Joe Hemingway’s principal. She admits the fact of agency. It is ... Sheth and YES of Russellville who are trying to avoid their contractual obligations to Lee. The proper inquiry in the present case is simply whether Lee authorized Hemingway to make the contract on her behalf. See Restatement (Second) of Agency § 292 (1958). She testified that she did and ratified the contract in open court. The inquiry should have ended there.”

Brief of Appellants, at 18-19 (emphasis added).

This contention, however, merely assumes away the issue. The dispositive issue is, as the trial court properly identified it, whether Lee is the principal. This is not the “ordinary” agency ease in which the identity of the principal is undisputed. Here, the identity of the principal is the issue. The question, in other words, is which individual — Hemingway or Lee— was, in reality, doing business as AQS. If that individual was Hemingway, then whether Lee declines to disclaim, or seeks to ratify, his actions is immaterial.

Indeed, “ ‘[h]ow the parties characterize the relationship is of no consequence; it is the facts of the relationship that control.’ ” Thrash, 821 So.2d at 972 (quoting Martin v. Goodies Distrib., 695 So.2d 1175, 1177 (Ala.1997)). In a case such as this one, the right-of-control test is useful. It is undisputed that AQS is a sole proprietorship — “a business in which one person owns all the assets [and] owes all the liabilities.” Black’s Law Dictionary 1898 (7th ed.1999). It almost goes without saying that “the owner of a business is a principal.” 1 Restatement (Second) of Agency § 1 comt. d (1958) (emphasis added).

The right-of-control test identifies primary and secondary actors and locates the source of authority and responsibility. In other words, the test isolates some indicia of ownership material to the resolution of this case. This is particularly true here, in view of the fact that the trial court found the oral testimony of the purported principal and agent to be incredible. In short, we conclude that the trial court did not err in applying the right-of-control test.

II. The Findings

It is well settled that “[t]he judgment of a trial court based on ore tenus evidence is presumed correct, and its findings ‘will not be disturbed on appeal unless they are palpably wrong, manifestly unjust, or without supporting evidence.’ ” Anderson v. Lee, 621 So.2d 1305, 1307 (Ala.1993) (quoting McCoy v. McCoy, 549 So.2d 53, 57 (Ala.1989)). The trial court found that Hemingway, not Lee, was “the entity known as AQS.” We cannot conclude that that finding was “palpably wrong, manifestly unjust, or without supporting evidence.”

The trial court stated:

“It is the finding of the court that various names have been utilized in the documentation submitted as evidence: (1) Helen Lee d/b/a American Quality Service; (2) Joe Hemingway d/b/a American Quality Service; (3) American Quality Service by Joseph Hemingway, Construction Director (V.P.); (4) American Quality Service by Joseph Hemingway, authorized agent; and (5) Joseph Hemingway, General Contractor for [Narendra] Sheth.... It is the ... finding of the court that the entity identified as American Quality Service of Tennessee was granted a General Contractor’s (GC) license # 21031 in 1995, which was renewed through December 1999. The application for that license was signed by Helen Lee, as the sole owner of that entity. It is undisputed that the application executed by Helen Lee included the financial resources of Ms. Lee, but reflected the construction experience of Joseph Hemingway....
“It is the finding of the court that Joseph Hemingway had the construction experience to support an application as a general contractor. It is undisputed that he has such work experience in various areas of construction including, but not limited to, electrical and plumbing. It is the determination of this court that Joseph Hemingway directed all phases of the construction of the Russellville [hotel] project. Helen Lee’s participation, exclusive of financial backing, was limited to fielding telephone calls and assisting with paperwork. It is the finding of this court that Joseph Hemingway’s testimony is not credible and the documentary evidence supports the position that at the time of the negotiations of the contracts to construct the hotel, and throughout the period of construction, Joseph Hemingway acted independent of Helen Lee.”

(Emphasis added.) The record supports those findings.

In addition to the evidence cited above, the record contains a number of “lien waivers,” executed by Hemingway. One such document, executed on August 20, 1999, states, in pertinent part:

“In consideration of a check in the amount of $14,455 ... the undersigned general contractor does hereby waive, release and quitclaim, to the extent only of the aforesaid amount, all rights that he may have to Lien, pursuant to the laws of the State of Alabama, for labor furnished in construction and improvements to, or upon, the following described property:
“Holiday Inn Express and Suites
13770 Hwy 43
Russellville, AL 35653
7s/ Joseph Hemingway
“Joseph Hemingway d/b/a American Quality Service”

(Emphasis added.) A second document, identical in all material respects, except as to the amount, was executed on August 26, 1999.

Moreover, the hotel construction project was operated through two bank accounts opened by Hemingway. The accounts were opened in the name of “Joseph E. Hemingway Construction Account,” or simply, “Joseph E. Hemingway.” All the money received from the hotel construction project was deposited in one of the two accounts. Lee was not a signatory on either account, and she received no money from the accounts. Although Hemingway wrote checks to himself from the accounts, he never received a “paycheck” from Lee or from AQS. These facts and similar documents and testimony, with which the record is replete, are indicia of Hemingway’s ownership of AQS.

Not to be overlooked is the fact that, when the complaint was filed initiating case no. CV-99-240, it was filed by “Joe Hemingway d/b/a American Quality Service.” Count One of the complaint stated in part:

“1. Joe Hemingway d/b/a American Quality Service brings this action against the defendants, YES of Russell-ville, Inc. and [Narendra] Sheth, an individual, for the purpose of establishing a hen upon the property hereinafter described in ‘Exhibit A’ attached hereto and incorporated herein as if fully set forth.
“2. The plaintiff is a sole proprietorship ....
“3. The plaintiff is engaged in, among other things, the business of providing labor and material for the construction and improvement of commercial projects.
“4. The plaintiff contracted with the defendant, YES of Russellville, Inc., and [Narendra] Sheth, an individual, for construction of the Holiday Inn Express and Suites located on Highway 43, Rus-sellville, Franklin County, Alabama....
“5. The plaintiff, Joe Hemingway d/b/a American Quality Service performed work under the contract in accordance with the instructions and specifications of the said YES of Russellville, Inc. and [Narendra] Sheth.”

The complaint was signed: “Joe Hemingway d/b/a American Quality Service.”

That complaint was filed on October 28, 1999. However, it was not until after December 8, 1999, when YES and Sheth filed their summary-judgment motion, raising the issue of noncompliance with § 34-8-1 et seq., that Lee appeared in the case to assert that Hemingway was merely acting as her agent in contracting for the construction of the hotel. In short, the record amply supports the finding that Joseph Hemingway was doing business as American Quality Service in the construction of the hotel.

For the first time, Lee and Hemingway argue in this Court:

“It is not necessary to determine the outcome of this case on the technical question of which person — Lee or Hemingway — was the ‘real’ principal.... Hemingway is ... ‘connected with the [licensed general contractor] as an officer, partner or employee,’ and this Court should hold that his construction activities are authorized pursuant to the license issued to [AQS].”

Appellants’ Brief, at 29, 35-36 (quoting Cooper v. Johnston, 283 Ala. 565, 569, 219 So.2d 392, 395 (1969) (emphasis added)). Essentially, they now contend that Hemingway is sufficiently “connected with the [licensed general contractor] as an officer, partner or employee,” to satisfy statutory law and caselaw, regardless of his “technical” status. Thus, for the first time on appeal, they suggest that the nature of the entity, itself, might affect its right to enforce the contract.

Throughout these proceedings, Lee and Hemingway have taken the position that AQS is a sole proprietorship, and have cast their arguments only in terms of the principal/agent relationship. At no time have they asserted that the actions of Hemingway might satisfy the statutory scheme under some alternative organizational structure. They have persisted in the claim that the contract is valid, solely because Lee, as principal, authorized Hemingway, as agent, to execute it.

Indeed, since this Court decided the first appeal in this case the parties have entertained markedly differing views of the issues to be tried. The position adopted by Lee and Hemingway is, in part, an outgrowth of their opinion of the scope of the opinion in Lee I. That opinion was in essentially two parts. “Part I” stated: “If a jury determines that an agency relationship did not exist, then the contract would be void because Hemingway was not a licensed general contractor.” Lee I, 784 So.2d at 1028. “Part II” stated: “However, if the jury determines that the agency relationship did exist, and thus that Lee is a valid party to the contract, the dispute must proceed to arbitration.” Id. The Owners presented their case in the context of Part I, attempting to prove that Hemingway, not Lee, was doing business as AQS, to procure a holding that the contract was void.

Lee and Hemingway, on the other hand, presented their case in the context of Part II, arguing that the only triable issue was whether Lee had authorized Hemingway to contract with the Owners. For example, in the hearing on their postjudgment motion, Lee and Hemingway argued that the trial court’s judgment had exceeded the scope of the opinion in Lee I, which they characterized, as “exceedingly narrow.” The inquiry should, they contended, have been limited to the mere question “whether or not Helen Lee gave Joseph Hemingway the authority to sign that contract at that time in that manner on behalf of American Quality Service.” Consequently, it was not until the hearing on the posttrial motion that they conceded that “maybe it’s what this organization is that [the] argument arises about.” (Emphasis added.) Even then, they did not argue, as they do here, that Hemingway is sufficiently “connected with the [licensed general contractor] as an officer, partner or employee,” to satisfy statutory law and caselaw, regardless of his “technical” status.

Lee and Hemingway have read the opinion in Lee I too narrowly. Part I of that opinion clearly signaled that one issue would be whether Hemingway was AQS. Only if he was would the contract be void. As a result, their argument that Hemingway’s status does not matter comes too late.

It is well settled that this Court will not address issues raised for the first time on appeal. Byrd v. Lamar, 846 So.2d 334, 341 (Ala.2002); Neal v. Neal, 856 So.2d 766, 778 (Ala.2002). The trial court will not be placed in error on the basis of issues never presented to it. Grayson v. Hanson, 843 So.2d 146, 149 (Ala.2002); Beavers v. County of Walker, 645 So.2d 1365, 1372 (Ala.1994). For these reasons, the judgment of the trial court is affirmed.

AFFIRMED.

MOORE, C.J., and LYONS, BROWN, JOHNSTONE, HARWOOD, and STUART, JJ., concur.

HOUSTON, J., concurs in the result.

      . Case no. 1011691 represents the appeal from CV-99-224. Case no. 1011692 represents the appeal from CV-99-240.


author: LYONS, Justice.

text:
    James K. LYONS, in his official capacity as director of the Alabama State Port Authority v. RIVER ROAD CONSTRUCTION, INC.
    1012092.
    Supreme Court of Alabama.
    March 14, 2003.

      James Rebarehak and David F. Walker of Miller, Hamilton, Snider & Odom, L.L.C., Mobile, for appellant.
    William J. Baxley and Joel E. Dillard of Baxley, Dillard, Dauphin & McKnight, Birmingham, for appellee.
   LYONS, Justice.

James K. Lyons, in his official capacity as director of the Alabama State Port Authority (“the port authority”), petitioned this Court, pursuant to Rule 5, Ala. R.App. P., for permission to appeal from the trial court’s denial of his motion to dismiss a case pending below based upon the doctrine of State immunity provided in Art. I, § 14, Alabama Constitution of 1901. We granted permission to appeal, and we reverse and remand.

I. Facts and Procedural History

On September 10, 1998, the port authority contracted with Ben Radcliff Contractor, Inc. (“Radcliff’), to construct a liquid-bulk terminal at the Theodore Ship Turning Basin located at the Port of Mobile. On October 2, 1998, Radcliff entered into a subcontract with River Road Construction, Inc. (“River Road”), for the dredging portion of the project.

River Road alleges that in developing its bid to Radcliff for the dredging it relied upon the soil-boring data in a report prepared by Southern Earth Sciences, Inc. The report was commissioned by the port authority, and it indicated that the material involved in the dredging work consisted of sand and clay. However, after River Road began dredging, it encountered a substantial presence of rock, which made the dredging work more difficult and more expensive. River Road alleges that when it became aware of the presence of rock in the area to be dredged it gave notice of the unforeseen conditions to Radcliff and the port authority. River Road completed the dredging work; it alleges that it incurred additional expenses of $1,108,944 in dredging the unanticipated rock. The port authority refused to pay River Road the additional expenses.

On June 12, 2000, River Road filed a complaint against the port authority with the State Board of Adjustment (“the Board”) demanding payment of its additional expenses. The port authority filed with the Board a motion to dismiss the complaint for lack of jurisdiction. In its response to the port authority’s motion to dismiss, River Road acknowledged that its action against the port authority could not be submitted to a court because it was constitutionally barred by the doctrine of State immunity.

On March 23, 2001, while its claim before the Board was pending, River Road sued Lyons in his official capacity as director of the port authority. River Road alleged that the soil-boring data report Lyons furnished it and on which it relied in submitting its bid for the dredging project was misleading because the report failed to disclose the substantial quantity of rock. River Road alleged that the rock composition was “unforeseen by the parties when dredging bids were made and accepted,” and that the amount of its bid would have been greater had it known that the basin was composed of rock. River Road requested a declaration of its rights and further requested the court to compel Lyons to perform his “legal duty” to pay River Road for the additional expenses of $1,108,944.

The Board subsequently dismissed River Road’s claim against the port authority on the basis that it lacked jurisdiction of the claim. Lyons filed a motion in the circuit court to • dismiss the complaint against him, arguing that River Road’s action was barred by the doctrine of State immunity. River Road argued in response to Lyons’s motion to dismiss that its action was not precluded by the doctrine of State immunity because, it says (1) its action was brought to compel a State official to perform a legal duty, (2) its action was brought to compel a State official to perform a ministerial act, and (3) its action was brought under the Declaratory Judgment Act, § 6-6-220 et seq., Ala. Code 1975.

In a letter brief dated April 23, 2002, River Road urged the trial court to adopt the principles expressed in Sizemore v. Rinehart, 611 So.2d 1064 (Ala.Civ.App.1992), and Kemp v. Britt, 410 So.2d 31 (Ala.1982). River Road argued that the plaintiffs in both Sizemore and Kemp obtained declaratory judgments and injunc-tive relief against State officials, notwithstanding § 14, Ala. Const, of 1901, because the State owed the plaintiffs a legal obligation.

On July 24, 2002, the trial court entered an order denying Lyons’s motion to dismiss; the court helpfully explained its ruling as follows:

“At first blush it would certainly appear that this is either a suit against the State for money damages or a request for an advisory opinion, neither of which is a proper subject for consideration by this Court. However, [River Road] cites several cases which appear to support its position.
“In Sizemore v. Rinehart, 611 So.2d 1064 (Ala.Civ.App.1992), the trial court’s determination that taxes were improperly collected and due to be refunded was affirmed. The Petition for Writ of Cer-tiorari was quashed as improvidently granted. Ex parte Sizemore, 611 So.2d 1069 (Ala.1993). Dissenting from that action[,] Justice Houston ... concluded that the suit was an action against the State seeking funds from the treasury and, as such, should be barred by § 14 of the [State] Constitution. See also Kemp v. Britt, [410] So.2d 31 (Ala.1982), a case in which the plaintiffs sought and obtained a declaration that the State owed them certain monetary benefits.
“If Justice Houston is right in his analysis of Sizemore, and I think he is, the Alabama courts have allowed cases analogous to this to proceed despite the apparent Constitutional prohibition. The motion to dismiss is denied.”

II. Standard of Review

The appropriate standard of review of a trial court’s denial of a motion to dismiss 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 [the pleader] to relief.” Nance v. Matthews, 622 So.2d 297, 299 (Ala.1993); Raley v. Citibanc of Alabama/Andalusia, 474 So.2d 640, 641 (Ala.1985). This Court does not consider whether the plaintiff will ultimately prevail, but only whether the plaintiff may possibly prevail. Nance, 622 So.2d at 299. A “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.” Nance, 622 So.2d at 299; Garrett v. Hadden, 495 So.2d 616, 617 (Ala.1986); Hill v. Kraft, Inc., 496 So.2d 768, 769 (Ala.1986).

III. Analysis

The port authority is an agency of the State of Alabama. See § 33-1-2, Ala. Code 1975; Alabama State Docks Terminal Ry. v. Lyles, 797 So.2d 432, 434 (Ala.2001). The Legislature has given the port authority the power to construct, own, and operate structures and facilities “needed for the convenient use of the port authority in the aid of commerce, including the dredging of approaches thereto.” § 33-1-12, Ala.Code 1975. The port authority has the power “[t]o enter into contracts with ... private persons, firms, [and] corporations ..., in furtherance of its public purposes and objects....” §33-1-12.1(6), Ala.Code 1975. As a State agency, the port authority cannot be sued for money damages. Lyles, 797 So.2d at 434; Jones v. Alabama State Docks, 443 So.2d 902 (Ala.1983) (an action for damages against the Alabama State Docks Department is prohibited by the doctrine of State immunity); State Docks Comm’n v. Barnes, 225 Ala. 403, 143 So. 581 (1932).

The immunity that protects the port authority is derived from Art. I, § 14, Ala. Const. of 1901. Section 14 provides “[t]hat the State of Alabama shall never be made a defendant in any court of law or equity.” Under § 14, the State and its agencies are absolutely immune from suit. Ex parte Franklin County Dep’t of Human Res., 674 So.2d 1277, 1279 (Ala.1996). State officers sued in their official capacities are also “ ‘absolutely immune from suit when the action is, in effect, one against the state.’ ” Williams v. John C. Calhoun Cmty. Coll, 646 So.2d 1, 2 (Ala.1994) (quoting Phillips v. Thomas, 555 So.2d 81, 83 (Ala.1989)). The State cannot be sued indirectly by suing an officer in his or her official capacity when a judgment against the officer would directly affect the financial status of the State treasury. Barnes, 225 Ala. at 405, 143 So. at 582; Alabama State Docks v. Saxon, 631 So.2d 943, 946-47 (Ala.1994) (holding that the director of the Alabama State Docks Department was entitled to State immunity).

This constitutionally guaranteed principle of State immunity acts as a jurisdictional bar to an action against the State by precluding a court from exercising subject-matter jurisdiction. Lyles, 797 So.2d at 435. Therefore, if Lyons is protected by State immunity, we must dismiss the action against him for lack of subject-matter jurisdiction. See Lyles, 797 So.2d at 435; see also Patterson v. Gladwin Corp., 835 So.2d 137 (Ala.2002).

A. Cases Relied upon by the Trial Court

We first address the holdings of Size-more, supra, and Kemp, supra, relied upon by the trial court. In Sizemore, the plaintiffs challenged the constitutionality of State statutes that taxed the plaintiffs’ military retirement benefits differently than the retirement benefits received by individuals “due to their state employment.” 611 So.2d at 1065. The Court of Civil Appeals affirmed the trial court’s judgment, holding that the statutory scheme violated the doctrine of intergovernmental tax immunity and authorizing the trial court to order refunds to the plaintiffs. 611 So.2d at 1067, 1069. This Court granted certiorari review of the case and then quashed the writ as improvidently granted. Ex parte Sizemore, 611 So.2d 1069 (Ala. 1993). In an opinion dissenting from quashing the writ, Justice Houston argued that “the State of Alabama was made a defendant in violation of § 14 of the Alabama Constitution” and that the action impermissibly sought funds from the State treasury as a remedy. 611 So.2d at 1071.

Relying upon State immunity compelled by § 14, we adopted in Patterson, supra, the rationale of Justice Houston and overruled the holding of the Court of Civil Appeals in Sizemore. In Patterson, the plaintiffs sued the commissioner of the Revenue Department and sought refunds of previously paid corporate franchise taxes. 835 So.2d at 140. The plaintiffs failed to invoke the administrative procedures provided in the Taxpayers’ Bill of Rights and Uniform Revenue Procedures Act (“TBOR”), and instead, relied upon Size- more,, pursuant to which the taxpayers sued the State directly. The commissioner in Patterson argued that a direct action seeking a tax refund from the State treasury was barred by the doctrine of State immunity. 835 So.2d at 142. This Court agreed and held that compliance with the TBOR was the exclusive means to obtaining a franchise-tax refund and that the plaintiffs’ action constituted a direct action against the State in violation of the doctrine of State immunity. 835 So.2d 153-54.

In the present action, a judgment in favor of River Road would directly “affect the financial status of the state treasury.” Barnes, supra, 225 Ala. at 405, 143 So. at 582. Unlike the plaintiffs in Patterson, River Road did initially bring its claim before an administrative body. However, despite the Board’s dismissal of its claim, River Road cannot now bring an indirect action against the State by suing a State official. Such an action impermissibly seeks funds from the State treasury. Patterson, 835 So.2d at 142; Barnes, supra, 225 Ala. at 405, 143 So. at 582.

Nor does Kemp save River Road’s claims. In Kemp, this Court construed an act that transferred the maintenance responsibilities for road and bridge work in 10 counties from the State Highway Department to the county in which the roads or bridges were located. 410 So.2d at 32. The act provided for a voluntary transfer of up to 75 percent of the State Highway Department employees operating in the counties to the new county system and directed the State to pay the employees their current and accumulated benefits. 410 So.2d at 32. The State refused to pay for accumulated sick leave. The employees sued the director of the State Highway Department and argued that the act mandated the payment of the employees’ benefits, including accumulated sick leave benefits. 410 So.2d at 32. After the action was commenced, the act was amended to provide that the accumulated sick leave benefits be paid directly to the county and held in trust for the benefit of the employees. 410 So.2d at 33.

The only issue in Kemp was to whom the State should pay the benefits — the employees or the county. 410 So.2d at 34. No issue concerning § 14 was raised or discussed. Moreover, the act in question specifically stated that the benefits paid “shall be the obligation of the State of Alabama.” 410 So.2d at 32. There is no statute mandating payment to River Road for its allegedly unforeseen expenses incurred in performing its dredging work.

B. Exceptions to State Immunity

River Road argues that Lyons is not protected by State immunity because, it says, its action falls within the excepted actions that are not considered to be “against the State” for § 14 purposes. See Gunter v. Beasley, 414 So.2d 41, 48 (Ala.1982). Specifically, River Road alleges that the doctrine of State immunity does not preclude its claim against Lyons because, it argues, its action seeks a declaration of River Road’s rights and seeks to compel Lyons to perform his legal duties. See Gunter, 414 So.2d at 48. River Road also alleges for the first time in its brief to this Court that Lyons’s actions fall outside the bar of State immunity because, it says, he acted “recklessly” in distributing the soil-boring data report. We briefly address each exception in turn.

i. Action Seeking a Declaratory Judgment

State immunity does not bar “[a]ctions brought under the Declaratory Judgments Act, [§ 6-6-22 et seq., Ala. Code 1975,] seeking construction of a statute and how it should be applied in a given situation.” Aland v. Graham, 287 Ala. 226, 230, 250 So.2d 677, 679 (1971); Curry v. Woodstock Slag Corp., 242 Ala. 379, 381, 6 So.2d 479, 480-81 (1942) (an action seeking to construe the law and direct the parties to what is required of them under a given set of facts does not violate the doctrine of State immunity); § 6-6-222, Ala.Code 1975. River Road contends that by filing this action it is seeking to determine its rights relative to the statutory powers granted the port authority and its director in the applicable sections of Title 33, Code of Alabama 1975. See §§ 33 — 1— 12 and -12.1. Lyons argues that River Road does not seek a declaration of rights under a statute and of how the statute should be applied, but instead seeks a declaration that the State should compensate River Road for its unforeseen expenses on the dredging project and an injunction to enforce that declaration. Lyons contends that River Road is attempting to characterize its claim as a declaratory-judgment action, when it is nothing more than an action for damages. We agree.

In Curry, supra, this Court described an action seeking a declaratory judgment:

“Considering the true nature of a suit which is declaratory of controversial rights and seeks no other relief, but only prays for guidance both to complainant and the State officers trying to enforce the law so as to prevent them from making injurious mistakes through an honest interpretation of the law, and thereby control the individual conduct of the parties, albeit some of them may be acting for the State, it is our opinion that a suit between such parties for such relief alone does not violate section 14 of the Constitution.”

242 Ala. at 381, 6 So.2d at 481. River Road is asking this Court to order the State to pay it $1,108,944 from the State treasury. As previously noted, no statute requires this payment. Moreover, River Road’s argument that its claim falls within the ambit of the Declaratory Judgment Act because it seeks a determination as to the construction and application of the law as it applies to River Road’s rights arising under a contract is unconvincing. No contract exists between the State and River Road to construe. River Road’s action will not prevent a mistaken interpretation of the law because River Road has presented no law to interpret. See Curry, 242 Ala. at 381, 6 So.2d at 481.

The cases cited by River Road also fail to support its proposition that its action seeks only a declaration of its rights. See, e.g., Snow v. Abernathy, 331 So.2d 626, 631 (Ala.1976) (determining the proper recipient of the decedent’s State retirement benefits); Gunter, supra, 414 So.2d at 49 (addressing the constitutionality of House and Senate resolutions specifically requiring payment by the State of expenses incurred by a former lieutenant governor); Unzicker v. State, 346 So.2d 931 (Ala.1977) (allowing an action against State officials when the plaintiffs alleged that the State officers acted beyond their authority).

ii Action to Compel a State Official to Perform a Legal Duty

River Road argues that the doctrine of State immunity does not bar its claim against Lyons because, it says, its action seeks to compel a State officer to perform a duty prescribed by law. In its brief to this Court, River Road contends that “Alabama caselaw is clear that if a state agency or official purchases goods or services on behalf of a state agency pursuant to lawful authorization, then an action may be maintained to require payment for those goods or services.” See Gunter, 414 So.2d at 47 (holding that the comptroller had a legal duty, as mandated by the Legislature, to make payments to a former lieutenant governor); Department of Indus. Relations v. West Boylston Mfg. Co., 253 Ala. 67, 42 So.2d 787 (1949) (holding that the State agency was required to distribute funds comprised of contributions by employees and employers and to perform its duties pursuant to the statute); State of Alabama Highway Dep’t v. Milton Constr. Co., 586 So.2d 872 (Ala.1991); State Bd. of Admin, v. Roquemore, 218 Ala. 120, 117 So. 757 (1928).

In Milton Construction, the State Highway Department contracted with Milton Construction, a private entity, to perform various highway construction projects. 586 So.2d at 873. The Highway Department withheld funds from Milton Construction based upon a disincentive clause in the contract, even though the disincentive clause had been declared void by this Court in Milton Construction Co. v. State Highway Department, 568 So.2d 784 (Ala.1990). The Highway Department based its refusal to pay, in part, on the doctrine of State immunity. This Court disagreed and stated:

“Once the Highway Department has legally contracted under state law for goods or services and accepts such goods or services, the Highway Department also becomes legally obligated to pay for the goods or services accepted in accordance with the terms of the contract. It follows that this obligation is not subject to the doctrine of [State] immunity and is enforceable in the courts.”

586 So.2d at 875 (emphasis added). Because the Highway Department had contracted with Milton Construction and had accepted its services, this Court held that the action was not barred by the doctrine of State immunity, “because it is in the nature of an action to compel state officers to perform their legal duties.” 586 So.2d at 875.

In Roquemore, supra, the State Highway Department, acting through the State Board of Administration, contracted with the plaintiff for the purchase of hay. 218 Ala. at 122, 117 So. at 758. The Highway Department later refused to accept any further deliveries of hay and refused to pay for the hay it had already received. 218 Ala. at 122, 117 So. at 758. This Court acknowledged that the Highway Department was authorized by statute to purchase necessary materials and that the statute mandated payment for the materials from the State highway fund. 218 Ala. at 123, 117 So. at 759. This Court held that the action was not barred by the doctrine of State immunity because a “clear legal duty” existed on behalf of the Highway Department to pay for the hay it had already accepted under the contract. 218 Ala. at 123, 117 So. at 759.

River Road incorrectly asserts that the facts in the present action are “almost identical” to the facts presented in Milton Construction and Roqmmore. In Milton Construction and Roquemore, this Court addressed the statutory duties of the Highway Department as those duties related to the actions at issue in those cases, just as River Road cites the statutory authority allowing Lyons to enter into contracts with private entities on behalf of the port authority. Milton Construction, 586 So.2d at 875, Roquemore, 218 Ala. at 123, 117 So. at 759. However, the fundamental difference between the present action and Milton Construction and Roquemore is the existence in those cases of a contract to establish a “clear legal duty” on behalf of the State. Unlike Milton Construction and Roquemore, no contract exists between the port authority and River Road, a subcontractor of Radcliff, the prime contractor, to bind the State to make any payments to River Road. River Road has failed to provide authority for the proposition that an entity with no contract with the State and a statutory mandate providing for payment can sue the State for money damages.

Hi. Action When Official’s Actions Constitute Bad Faith

Actions against State officials in their individual capacities are not prohibited by the doctrine of State immunity where it is “alleged that [the State officials] ... acted fraudulently, in bad faith, beyond their authority or in a mistaken interpretation of law.” Gunter, supra, 414 So.2d at 48. River Road argues for the first time on appeal that Lyons acted “in such a manner as to constitute fraud, deceit, or bad faith when he supplied erroneous information regarding the soil composition of the dredge site to prospective bidders knowing the bidders would rely on that information.” However, River Road alleges in its complaint only that the soil report prepared by Southern Earth Services, Inc., was misleading, that none of the parties had knowledge or warning of the rock content in the material to be dredged, and that Lyons had refused to compensate River Road for its unforeseen expenses in dredging the rock. Nothing in the complaint either indicates that Lyons’s actions constitute fraud, deceit, or bad faith or that he is being sued in any capacity other than his official capacity. Lyons properly challenges River Road’s failure to plead this theory in the trial court. We can affirm the trial court “on any ground developed in, and supported by, the record.” Ex parte Ramsay, 829 So.2d 146, 155 (Ala.2002). However, we would violate Lyons’s rights to due process under the circumstances here presented if we were to affirm the- trial court on the basis of a brand new theory never asserted in the trial court.

IV. Conclusion

River Road’s action is precluded by the doctrine of State immunity. We reverse the trial court’s order denying Lyons’s motion to dismiss and remand the case for the trial court to enter an order dismissing River Road’s action for lack of subject-matter jurisdiction.

REVERSED AND REMANDED.

HOUSTON, BROWN, JOHNSTONE, HARWOOD, WOODALL, and STUART, JJ., concur.

MOORE, C.J., concurs in the result.

      . The Alabama State Port Authority was formerly known as the Alabama State Docks Department. See § 33-1-2, Ala.Code 1975.

      . The parties refer to the immunity afforded to a State officer sued in his official capacity in an action against the State as "sovereign immunity.” The immunity available to the State and its officers in an action against the State is now referred to as "State immunity.” Ex parte Cranman, 792 So.2d 392, 396-97 (Ala.2000). See also Ex parte Butts, 775 So.2d 173 (Ala.2000), adopting the new terminology and test introduced in Cranman.

      . In its brief to this Court, River Road does not address the holdings of Sizemore and Kemp.

      . In its brief to this Court, River Road does not address its earlier contention that the doctrine of State immunity does not bar its action because its action seeks to compel the performance of a ministerial act.

      . "[I]t is neither this Court’s duty nor its function to perform a [party's] legal research.” City of Birmingham v. Business Realty Inv. Co., 722 So.2d 747, 752 (Ala.1998); Green Tree Fin. Corp. v. Vintson, 753 So.2d 497, 503 n. 5 (Ala.1999).