author: ALMON, Justice. EMBRY, Justice

text:
    EASTWOOD LANDS, INC., a Corporation v. UNITED STATES STEEL CORPORATION, et al.
    80-241.
    Supreme Court of Alabama.
    July 23, 1982.

      James C. King of Wilson & King, Jasper, for appellant.
    Robert G. Tate and Julia Smeds, of Thomas, Taliaferro, Forman, Burr & Murray, Birmingham, for appellees.
   ALMON, Justice.

The trial court entered the following opinion and order in this case:

OPINION AND ORDER

“This ease has been submitted for decision by this Court on the Motion for Summary Judgment filed by the defendant United States Steel Corporation (‘U. S. Steel’).

“Plaintiff, Eastwood Lands, Inc., a corporation (‘Eastwood’) is the owner of a parcel of land (hereafter referred to as the ‘Shopping Center Property’), containing approximately 1.43 acres and located in southwest quarter of the southwest quarter of Section 28, Township 16 South, Range 4 West, in Jefferson County.

“All of the Shopping Center Property was originally owned by Tennessee Land Company. In 1938, Tennessee Land Company conveyed two tracts of land which included the Shopping Center Property to two separate sets of purchasers.

“According to the recorded deeds, Robert L. Smith purchased one tract consisting of 7.84 acres for the purchase price of $450, and Roy V. and Clara Bell Shell purchased the other tract consisting of 8.58 acres for the purchase price of $500.

“In both deeds, Tennessee Land Company retained for itself or Tennessee Coal, Iron & Railroad Company, or their respective successors, the right to mine and remove coal and other minerals from the land without leaving support necessary for sustaining the surface of the land or for preventing damage thereto.

“Both deeds also provided that no right of action for damages on account of injuries to the land or any improvements on the land conveyed, resulting from mining operations should ever accrue to or be asserted by the purchasers or their successors in title and that ‘this condition shall constitute a covenant running with the land against the Grantee and all persons, firms or corporations holding under or through said Grantee.’

“These two deeds were duly recorded in the Probate Office of Jefferson County, Alabama, and therefore constituted notice to all persons of the mineral interest excepted from the conveyances and of the rights reserved to Tennessee Land Company and Tennessee Coal, Iron & Railroad Company.

“Since Eastwood’s title extends from the above two deeds executed by Tennessee Land Company, Eastwood was itself on notice of these rights. In addition, two of the deeds in Eastwood’s chain of title recite that the conveyance of the property described in each of the deeds is ‘subject to all mineral, mining and damages rights, they being retained by the Tennessee Coal, Iron & Railroad Company.’

“One deed naming Eastwood as grantee states, ‘minerals and mining rights and privileges are excepted.’

“In its complaint, Eastwood makes claim against U.S. Steel for damages, stating in substance that Eastwood has constructed a shopping center on the Shopping Center Property and that as a result of the mining operations conducted under the surface of the Shopping Center Property by U.S. Steel, the surface of the same was caused to subside, on and subsequent to August 13, 1979, causing the buildings comprising the shopping center to collapse, break and tear apart rendering them uninhabitable.

“In a second count of the complaint, Eastwood alleges that U.S. Steel negligently conducted such mining operations thereby causing the damages already described.

“As grounds in support of its Motion for Summary Judgment, U.S. Steel first presents evidence, not contradicted, that it is the successor to Tennessee Land Company and Tennessee Coal, Iron & Railroad Company, and that the provisions in the original deeds from Tennessee Land Company, giving it the right to mine coal and other minerals and releasing it from all damages thereby resulting, bars Eastwood from any recovery in this case.

“In Pennsylvania Coal Company v. Mahon, 260 U.S. 393, [43 S.Ct. 158, 67 L.Ed. 322] (1922), a statute (the Kohler Act) enacted by the Pennsylvania legislature prohibited the mining of coal in such a way as to cause the subsidence of any structure used as a human habitation. Pennsylvania Coal Company nevertheless gave notice of its intent to mine under dwellings in a Pennsylvania town without complying with the requirements of the statute.

“A number of persons then brought suit to prevent the Company from mining under their property in such a way as to remove the supports and cause a subsidence of the surface. They argued that the statute was a valid exercise of the state police power for the purpose of protecting the safety of its people. However, the U. S. Supreme Court reversed the decision in favor of the individual owners, holding that the Pennsylvania statute was unconstitutional, being a deprivation of the Company’s property without due process.

“Justice Holmes, speaking for the majority of the Court, stated in his opinion:

‘... The deed conveys the surface, but in express terms reserves the right to remove all coal under the same, and the Grantee takes the premises with a risk, and waives all claim for damages that may arise from mining out the coal.
‘... It is our opinion that the act cannot be sustained as an exercise of the police power, so far as it affects the mining of coal under streets or cities in places where the right to mine such coal has been reserved. As said in a Pennsylvania case: “For practical purposes, the right to coal consists in the right to mine it.” Com. ex rel. Keator v. Clearview Coal Co., 256 Pa. 328, 331, L.R.A. 1917 E., 672,100 A. 820. What makes the right to mine coal valuable is that it can be exercised with profit. To make it commercially impracticable to mine certain coal has very nearly the same effect for constitutional purposes as appropriating or destroying it. Thus we think that we are warranted in assuming that the statute does.
******
‘The rights of the public in a street purchased or laid out by eminent domain are those that it had paid for. If in any ease its representatives have been so short sighted as to acquire only surface rights, without the right of support, we see no more authority for supplying the latter without compensation than there was for taking the right of way in the first place, and refusing to pay for it because the public wanted it very much.. . . ’

“In Republic Steel Corp. v. Payne, 272 Ala. 483, 132 So.2d 581 (1961), Republic conveyed a parcel of land by deed containing a broad release quite similar to the lease involved in the present case, barring any cause of action by the grantees, or their successors, arising from operations by Republic on its remaining land adjacent to the parcel conveyed. The plaintiffs, who were lessees of the persons purchasing the property from Republic, brought suit against Republic for injuries allegedly suffered by them as a result of inhaling smoke, fumes, and gases emanating from a rock pile maintained by Republic on its adjacent land. Reversing a judgment in favor of the plaintiffs, the Alabama Supreme Court stated:

‘An owner of property in fee can dispose of it with such a restriction imposed and (except by eminent domain) could not be compelled to sell it on any other terms. The grantee who accepts the property with this limitation or servitude on the right to use it has no lawful complaint and neither he nor any persons succeeding to his estate with notice, actual or constructive, of the restriction imposed can, by judicial fiat, invoke the enlargement of the estate which was not purchased or conveyed. The benefit of this reservation follows the title and serves the dominant estate and the successor entitled to the original grantee, with notice of the servitude, are bound by it.
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‘The manifest intention of the parties to the deed, as gathered from the language used, was that there be reserved or created an estate in favor of Republic to do the very things complained of.’

“Also see, Southern Furniture Mfg. Co. v. Mobile County, 276 Ala. 322, 161 So.2d 805 (1963); Griffin v. Fairmont Coal Co., 59 W.Va. 480, 53 S.E. 24 (1905); 54 Am.Jr.2d Mines & Minerals, ¶ 203.

“The language contained in the original deeds from Tennessee Land Company is clear and unambiguous. There is reserved to Tennessee Land Company and Tennessee Coal, Iron & Railroad Company an absolute right to mine under the property conveyed and a full and complete release is extended to those companies by the owners and successors in interest of the surface rights to the property conveyed. Eastwood was on notice of the provisions in these two deeds at the times when it acquired the various parcels comprising the Shopping Center Property. It then acquired the Shopping Center Property subject to any conditions then existing which might make it unsuitable for the erection of a shopping center and also subject to any operations which U.S. Steel might later conduct which might make it unsuitable for a shopping center. As recited in the two deeds from Tennessee Land Company, the rights and releases there provided run with the land and are binding on Eastwood.

“Eastwood’s claim based on negligence is also barred by the reservations and releases set forth in the original deeds from Tennessee Land Company. In Alabama Great Southern Railroad Company v. Sumter Plywood Corporation, 359 So.2d 1140 (Ala.1978), the Supreme Court of Alabama stated that it is the general rule in this state that a party may not contract against the consequences of his own negligence. However, the Supreme Court recognized that there is an exception to this general rule which applies in cases where an exculpatory clause involves leases or other incidents to ownership of land.

“Furthermore, the decision of the Supreme Court in Alabama Great Southern, supra, was modified by the Supreme Court’s decision in Industrial Tile, Inc. v. Stewart, 388 So.2d 171 (Ala.1980). Referring to indemnity agreements in the decision last cited, the Supreme Court stated:

‘. .. However, after carefully reviewing all of the authority in this state, we are compelled to conclude that, if the parties knowingly, evenhandedly, and for valid consideration, intelligently enter into an agreement whereby one party agrees to indemnify the other, including indemnity against the indemnitee’s own wrongs, if expressed in clear and unequivocal language, then such agreements will be upheld. To the extent that Alabama Great Southern Railroad Company v. Sumter Plywood Corp., supra, holds otherwise, it is hereby modified.’

“The provisions in the original deeds from Tennessee Land Company are therefore valid and binding on subsequent grantees including Eastwood. As a consequence, Eastwood may not now maintain an action against U.S. Steel or any of its subsidiaries for damages resulting from mining operations carried on by U.S. Steel under the land owned by Eastwood.

“In accordance with this opinion, the Motion for Summary Judgment filed by U.S. Steel is hereby granted. Judgment is hereby rendered in favor of U.S. Steel and all other defendants and against Eastwood Lands, Inc. All costs of Court incurred in this proceeding are taxed against the plaintiff, Eastwood Lands, Inc.”

Eastwood timely filed an appeal to this Court. Eastwood argues on appeal that the trial court’s entry of summary judgment for U. S. Steel was erroneous because (1) Eastwood should have been allowed more time to conduct discovery to ascertain whether U. S. Steel conducted its mining operations in a negligent manner; (2) the reservation or covenant in the deeds in this case is not as specific as the one in the Republic Steel case relied upon by the trial court, and so that case is distinguishable; and (3) the clause under which Eastwood is denied a cause of action is void as against public policy.

We believe that the reasoning in Republic Steel Corporation v. Payne, 272 Ala. 483, 132 So.2d 581 (1961), disposes of the first two of these arguments. While it is true that the reservation involved in that case was more detailed as to types of damages for which the grantee would have no cause of action against the grantor, it is also true that the reservation in Eastwood’s chain of title explicitly and unambiguously bars Eastwood from bringing suit based on U. S. Steel’s failure to provide support. “The manifest intention of the parties to the deed, as gathered from the language used, was that there be reserved or created an easement in favor of Republic to do the very things complained of.” Id., 272 Ala. at 488, 132 So.2d 581. “[T]he right to subja-cent support, unless waived by express stipulation, is absolute.” Republic Iron & Steel Co. v. Barter, 218 Ala. 369, 118 So. 749 (1928) (emphasis added).

We do not find reversible error in Eastwood’s contention that the trial court should have allowed it more time to conduct discovery. This Court in Republic Steel, supra, held that the clause in the Paynes’ lessor’s deed barred actions based on negligence, even though the word “negligence” was not mentioned, because the “provisions exonerated] Republic ‘from any and all claims for damages .. . . ” Id., 272 Ala. at 489, 132 So.2d 581 (emphasis in original). The deeds from the Tennessee Land Company recite that “no right of action for damages on account of injuries to the land herein conveyed or to any buildings . . . resulting from past or future mining operations ... shall ever accrue .. ., this conveyance being made expressly subject to a 11 such injuries, either past or future ...” (emphasis added). The import of this clause is clearly the same as that in the Republic Steel case: the grantee and its successors have no cause of action arising from the grantor’s activities for injuries which affect the land conveyed.

We are also compelled to hold against Eastwood on its public policy argument. As the trial court’s reliance on Pennsylvania Goal Company v. Mahon, 260 U.S. 393, 43 S.Ct. 158, 67 L.Ed. 322 (1922), indicates, to do otherwise arguably would be to deprive U. S. Steel of property without due process of law. Pursuant to the covenants in the recorded Tennessee Land Company deeds, and under a reasonable interpretation of Pennsylvania Coal and Republic Steel, U. S. Steel had the right to mine this property without fear of being sued for subsidence of the surface. For a court now to allow a suit for this very type of damage would be to work an “enlargement of the estate which was not purchased or conveyed,” Republic Steel, supra.

Neither is Eastwood to be heard that this works a deprivation of its property rights. It sought this land out for purchase and was under a legal duty to inspect the title which it was acquiring. It argues that reservations of mineral rights are so common that notice of such a reservation is not notice that the purchaser would have no recourse if the very surface it was purchasing subsided. This is to say that perhaps Eastwood did not read the Tennessee Land Company deeds carefully. To allow such an argument to prevail would be to ignore the constructive notice of recorded deeds to which purchasers are held.

We hasten to add that this holding is limited to the facts of this case and should not be construed as any expression of opinion in cases where intentional torts are involved or where the subsurface is put to a use beyond a reasonable interpretation of the reserving instrument. The judgment of the trial court is therefore affirmed.

AFFIRMED.

TORBERT, C. J., and JONES, SHORES, BEATTY and ADAMS, JJ., concur.

FAULKNER and EMBRY, JJ., dissent.

EMBRY, Justice

(dissenting):

I must respectfully dissent from the holding that Eastwood’s claim based upon deprivation of vertical support on account of United States Steel’s mining operation and the claim based upon negligence are barred by the reservations and releases contained in the Tennessee Land Company’s original deed.

I would go beyond the exception carved in Sumter Plywood and adopt the rationale of Justice Jones’s dissent in Industrial Tile. I would, as he reasoned, simply hold any contract of indemnity relieving one of the consequences of his own negligence void as a matter of public policy.

FAULKNER, J., concurs.

      . The covenants in the deeds from Tennessee land company read as follows:
      “This conveyance is made upon the covenant and condition that the _ Tennessee Land Company_, hereinafter referred to as ‘Mineral Owner,’ or its successors, assigns, licensees, lessees or contractors shall have the right, which is hereby — reserved—to said Mineral Owner, its successors, assigns, licensees, lessees or contractors, to mine and remove the coal and other minerals contained in said land without leaving supports necessary for sustaining the surface of said land or for preventing damage thereto; and that no right of action for damages on account of injuries to the land herein conveyed or to any buildings, improvements, structures, pipe lines or other sources of water supply now or hereafter located upon said land, or to any owners or occupants or other persons in or upon said land, resulting from past or future mining operations of the Mineral Owner, or its successors, assigns, licensees, lessees or contractors, or resulting from the removal of coal and other minerals or coal seam or other roof supports by the Mineral Owner, or its successors, assigns, licensees, lessees or contractors, shall ever accrue to or be asserted by the Grantee herein or by said Grantee’s successors in title, this conveyance being made expressly subject to all such injuries, either past or future, and this condition shall constitute a covenant running with the land as against the said Grantee and all persons, firms or corporations holding under or through said Grantee.”


source: Caselaw Access Project

author: SHORES, Justice.

license: Public Domain

text:
    ALABAMA PUBLIC SERVICE COMMISSION, et al. v. B & B TRANSPORTATION AND LIMOUSINE SERVICE, INC.
    81-38.
    Supreme Court of Alabama.
    July 23, 1982.

      Robert C. Boyce, III of Furner, Boyce & Nave, Bessemer, Stanley W. Foy, Montgomery, and Ronald C. Forehand, Asst. Atty. Gen., for appellants.
    Donald B. Sweeney, Jr. of Markstein, Morris, Sweeney & Liles, Birmingham, for appellee.
   SHORES, Justice.

. This is an appeal from a decree reversing an order of the Alabama Public Service Commission. The commission’s order granted a request to transfer to Worcy Crawford, d/b/a Crawford and Sons Bus Service (Crawford), Certificate of Public Convenience and Necessity No. 2570 from Charles Atwood Anthony, d/b/a Anthony Bus Lines (Anthony).

By application filed with the APSC, Crawford sought authority from the commission to transfer Motor Carrier Certificate of Public Convenience and Necessity No. 2570 from Anthony to himself. The commission notified all interested parties and protests were filed by Appellee B & B Transportation and Limousine Service, Inc., Excursions Unlimited, Inc., and Greyhound Lines, Inc.

The application was heard before a hearing examiner. B & B was represented by counsel at the hearing, as were Excursions Unlimited and Greyhound. Sworn testimony was taken of four witnesses called by Crawford, including Crawford himself. Protestants introduced no independent testimony other than cross-examination of applicant’s witnesses.

After hearing the evidence, the examiner recommended to the commission that Certificate No. 2570 be transferred to Crawford for a limited term of one year and then permanently, pending petition by Crawford and upon showing by him that all operations “are in full compliance with the laws of Alabama and the requirements, rules and regulations” of the commission.

After consideration of the record, the examiner’s report and recommended order, and the exceptions filed, the APSC adopted the examiner’s report and recommended order in full.

B & B appealed to the circuit court of Jefferson County pursuant to Ala.Code 1975, § 37-3-29. The circuit court reversed the order of the APSC in its entirety and denied transfer of the application.

Crawford and the APSC then appealed. We reverse.

As we have held on numerous occasions, our review is treated as though the appeal had come directly from the order of the Alabama Public Service Commission to this Court, and no presumption of correctness is accorded to the decision of the circuit court. The evidence was not taken before the trial judge in the circuit court. That court, then, is in no better position to review the order than the Supreme Court. Alabama Public Service Commission v. B & B Transportation and Limousine Service, Inc., 397 So.2d 120 (Ala.1981); Alabama Public Service Commission v. Redwing Carriers, Inc., 366 So.2d 1111 (Ala.1979); Eagle Motor Lines, Inc., v. Alabama Public Service Commission, 343 So.2d 767 (Ala.1977).

In reviewing the APCS in this manner, its order is taken as prima facie just and reasonable and can be set aside by the circuit court or by this Court only if: “(1) The commission erred to the prejudice of appellant’s substantial rights in its application of the law; and (2) [t]he order, decision or award was procured by fraud or was based upon a finding of facts contrary to the substantial weight of the evidence.” Ala.Code 1975, § 37-1-124.

B & B contends that the decision of the commission was arbitrary and against the substantial weight of the evidence and contrary to the law. It bases this contention on the propositions that the certificate is dormant and may not be transferred and that the transferee Crawford is not qualified to conduct operations under the certificate.

Section 37-3-17, Ala.Code 1975, provides the standard that applications for transfer of certificates must satisfy:

“[A]ny certificate or permit may be transferred or leased pursuant to such rules and regulations as the commission may prescribe; provided, that no such certificate or permit shall be transferred, or lease of any such certificate or permit approved, except after a finding by the commission that the proposed transferee or lessee is in all respects qualified under the provisions of this chapter to conduct the service or operation contemplated by such certificate or permit and that the proposed transfer or the approval of said lease is consistent with the public interest.”

B & B contends that the requirements of this section were not satisfied. The circuit court agreed, holding:

“Due to the finding of the hearing examiner and the adoption of the hearing examiner’s findings by the APSC as to the qualifications of Crawford, the Court is of the opinion that the order is contrary to the substantial weight of the evidence.”

The circuit court further held that because Crawford intended to operate a charter service in competition with B & B’s charter service, the error of the APSC in applying the law would be to the prejudice of B & B’s substantial rights. With these contentions we cannot agree.

We agree with the circuit court in its statement of the law that it is the policy of the APSC not to transfer dormant certificates unless good cause is shown. Alabama Public Service Commission v. Chem-Haulers, Inc., 293 Ala. 677, 309 So.2d 453 (1975); Floyd and Beasley Transfer Co., Inc. v. Alabama Public Service Commission, 276 Ala. 130, 159 So.2d 833 (1964). We need not address the question of whether the certificate was dormant; in either event, we agree with the hearing examiner that good cause was shown for the transfer. That good cause exists in the needs of the public for service where no other service now exists.

The need for bus service in the area covered by certificate No. 2570 was demonstrated in testimony before the hearing examiner. B & B offered no evidence that it, or any other line, was presently serving this area, or that no service was needed in the area. From the evidence we cannot say that the hearing examiner and the APSC erred in finding good cause for the transfer of the certificate.

Likewise, in determining Crawford’s qualifications to operate under the certificate, we disagree with appellee’s contention that the finding of the hearing examiner is contrary to the substantial weight of the evidence. An examination of the record indicates that Crawford has the experience, equipment, and financial resources to conduct operations under the certificate.

As B & B points out, the hearing examiner questioned Mr. Crawford’s willingness to abide by the commission’s rules and regulations in light of his numerous past citations. The hearing examiner, however, listened to the oral testimony, observed the demeanor of the witnesses, including Mr. Crawford, and after determining that the transfer was in the public interest, concluded that a limited-term grant of the transfer of the certificate to Mr. Crawford would resolve any questions as to the transferee’s willingness to conduct operations in accordance with the law and the rules and regulations of the commission. It cannot be said that the record is inadequate to support the conclusion.

Implicit in the phrase “consistent with the public interest” is the consideration of the interests of protesting and other competing carriers. Ross Neely Express, Inc. v. Hornady Truck Lines, Inc., 387 So.2d 782 (Ala.1980), and cases cited therein. The trial court, in considering the interests of B & B, determined that

“[s]ince the charter service to be run by Crawford would be in competition with the Appellant’s charter service, the error of the APSC in its application of the law would be to the prejudice of the Appellant’s substantial rights.”

We find no evidence in the record to support this conclusion. B & B offered no evidence other than the cross-examination of Crawford’s witnesses. An examination of the record fails to disclose any evidence of potential financial harm to B & B that would occur as a result of the transfer.

The report of the hearing examiner as adopted by the APSC found good cause consistent with the public interest for the transfer of Certificate No. 2570 from Anthony to Crawford. The order of the APSC is based on a finding of facts supported by substantial legal evidence. The case is, therefore, remanded with instructions to enter an order affirming the order of the Alabama Public Service Commission.

REVERSED AND REMANDED.

TORBERT, C. J., and FAULKNER, JONES and BEATTY, JJ., concur.


text:
    CITY OF RAINBOW CITY, a municipal corporation v. Vernon E. RAMSEY and Aubrey L. Holderfield.
    81-130.
    Supreme Court of Alabama.
    July 23, 1982.

      James F. Hinton and Ronald C. Higgins, Gadsden, for appellant.
    R. Ben Hogan, III, of Hogan, Smith & Alspaugh, Birmingham, and Robert H. King, Gadsden, for appellees.
   SHORES, Justice.

Defendant Rainbow City, a municipal corporation, appeals from a judgment based on a jury verdict for the plaintiffs, Vernon E. Ramsey and Aubrey L. Holderfield, in the amount of $14,000.00. We affirm.

Shortly after midnight on Sunday, May 28, 1978, Vernon E. Ramsey and Aubrey L. Holderfield, occupants in Holderfield’s pickup truck, struck a large “sinkhole” while proceeding on Brown Avenue, a public roadway within the city limits of Rainbow City, Alabama. Holderfield, the driver, lost control of the vehicle and struck a telephone pole, resulting in numerous injuries to each man and extensive damage to the truck.

Ramsey and Holderfield filed suit against the city of Rainbow City on December 12, 1978, alleging negligent maintenance, failure to reasonably inspect, and failure to warn the public of existing hazards. Rainbow City, in its answer, proffered a general denial, a defense of contributory negligence, and denied having any prior notice or knowledge of “any hole or crater” made the basis of plaintiffs’ complaint.

On March 27, 1979, defendant Rainbow City filed a third party complaint against Watts Construction Company (Watts). Watts had a contract with the city for the installation and repair of certain sewer lines, including those lines beneath Brown Avenue. The city alleged that Watts’s negligence in installing the lines and backfill-ing the earthen material around those lines underneath Brown Avenue resulted in a sinkhole and was the proximate cause of plaintiffs’ injuries. Plaintiffs later amended their original complaint by adding Watts as a defendant. The trial court disallowed the amendment on the ground that it was barred by the statute of limitations.

At trial, plaintiffs offered into evidence the deposition of Sam E. Hendon, Jr., a resident of Brown Avenue, to show that the city had notice of the sinkhole prior to May 28,1978, date of the plaintiffs’ accident. In his deposition, Hendon stated that he spoke to Rainbow City Mayor W. R. Smith by telephone on Friday afternoon, May 26, 1978, and informed Smith of a large hole in Brown Avenue, approximately five feet long by four feet wide, that posed a serious danger to people traveling that street. Subsequent to the events of May, 1978, and prior to Hendon’s deposition, given in August, 1981, Smith died.

Both the city and Watts, the third party defendant, objected to Hendon’s deposition on the grounds of hearsay and that it violated § 12-21-163, Ala.Code 1975, commonly known as the Dead Man’s Statute. The trial court, relying on Bank of the Southeast v. Koslin, 380 So.2d 826 (Ala.1980), overruled the objection and admitted Hen-don’s deposition into evidence.

At the close of the plaintiffs’ case, the trial court denied the city’s motion for a directed verdict. At the close of all the evidence, however, the trial court did grant Watts’s motion for a directed verdict and dismissed Watts from the action. The jury returned a verdict in favor of the plaintiffs, awarding Ramsey $4,000 and Holderfield $10,000. Rainbow City appeals. We affirm.

The city argues that the trial court erred in not dismissing the original complaint because the plaintiffs failed to join Watts as an original defendant within the time allowed by the statute of limitations. Section 11-47-191, Ala.Code 1975, in part, provides:

“[I]f a civil action be brought against the city or town alone and it is made to appear that any person or corporation ought to be joined as a defendant in the action according to the provisions in section 11-47-190, the action shall be dismissed, unless the plaintiff amends his complaint by making such party or corporation a defendant.... ”

Regardless of the possible merit of this argument, we are unable to consider it because it is raised for the first time here on appeal. Bevill v. Owen, 364 So.2d 1201 (Ala.1979); McWhorter v. Clark, 342 So.2d 903 (Ala.1977). The trial court may not be put in error for failure to rule on a matter which was not presented to it or decided by it. Southern Cement Company v. Patterson, 271 Ala. 128, 122 So.2d 386 (1960).

Our review of the record shows that neither in its answer nor at any time during the trial did the city attempt to raise this defense. The general rule is that a defense not asserted in a trial court cannot be raised for the first time on appeal. Green v. Standard Fire Insurance Company, 398 So.2d 671 (Ala.1981); Whitman v. Knapp, 285 Ala. 57, 228 So.2d 814 (1969).

The city also argues that the trial court erred in admitting Hendon’s deposition into evidence. Section 11-47-190, Ala.Code 1975, states, in part, that:

“No city or town shall be liable for damages for injury done to or wrong suffered by any person . . . unless said injury or wrong was done or suffered through the neglect, carelessness or failure to remedy some defect in the streets, alleys, public ways or buildings after the same had been called to the attention of the council or other governing body. ...” (Emphasis added.)

Hendon’s conversation with W. R. Smith, who was mayor of Rainbow City in 1978, was the only evidence plaintiffs offered to show that the city had notice of the sinkhole. Rainbow City contends that because Smith was deceased at the time of trial and unable to rebut Hendon’s testimony, Hen-don’s statements concerning the sinkhole’s existence violated the Dead Man’s Statute and were, therefore, inadmissible.

Section 12-21-163, Ala.Code 1975, provides:

“In civil actions and proceedings, there must be no exclusion of any witness because he is a party or interested in the issue tried, except that no person having a pecuniary interest in the result of the action or proceeding shall be allowed to testify against the party to whom his interest is opposed as to any transaction with, or statement by, the deceased person whose estate is interested in the result of the action or proceeding or when such deceased person, at the time of such transaction or statement, acted in any representative or fiduciary relation whatsoever to the party against whom such testimony is sought to be introduced .. .. ” (Emphasis added.)

The Dead Man’s Statute excludes only the testimony of a witness who has a pecuniary interest in the result of the lawsuit. Cole v. Adkins, 358 So.2d 447 (Ala.1978). That interest must be present, certain, invested, not uncertain, remote, or contingent. 81 Am.Jur.2d Witnesses, § 365 (1977).

The trial court, in overruling the city’s objection to Hendon’s testimony, relied on our decision in Bank of the Southeast v. Koslin, supra. In Koslin, we stated that in order for the Dead Man’s Statute to disqualify a witness from testifying about his dealings with a deceased individual, three criteria must be met: (1) The witness must have a pecuniary interest in the result of the proceedings; (2) the estate of the deceased must be interested in the outcome of the suit; and (3) the testimony of the witness must relate to a personal transaction with the decedent. 380 So.2d at 829. We need look only at the first of these criteria to conclude that § 12-21-163 did not apply to Hendon’s testimony.

The city argues that Hendon, as a resident of Brown Avenue, has a pecuniary interest in establishing the city’s liability for failure to repair the street defects because he is exposed to the same danger that befell plaintiffs. We do not agree. Hen-don had never met either plaintiff until Holderfield came to his house several weeks after the accident asking questions about the street’s condition. If Hendon had any interest in the outcome of plaintiffs’ lawsuit, it is not a pecuniary one within the meaning of § 12-21-163.

Finally, the city argues that the trial court erred in denying its motion for a directed verdict, contending that plaintiffs failed to prove that notice of the defect was given, as required by statute. This argument must also fall. Hendon’s deposition, which was admissible, supplied this proof.

The judgment entered below is affirmed.

AFFIRMED.

TORBERT, C. J., and FAULKNER, JONES and BEATTY, JJ., concur.


author: PER CURIAM. JONES, Justice

text:
    Leon GLOVER, etc. v. CITY OF MOBILE, etc.
    81-183.
    Supreme Court of Alabama.
    July 23, 1982.

      George J. Moore of Moore & Layden, Mobile, for appellants.
    Thomas M. Galloway, Jr., of Collins, Galloway & Smith, Mobile, for appellees.
   PER CURIAM.

Plaintiff Leon Glover, as Administrator, brought an action against Defendant City of Mobile for the wrongful death of his two minor sons. Plaintiff now appeals from a summary judgment for Defendant and the denial of his motion to reconsider.

We affirm.

Luscher Park, a recreational facility of the City of Mobile, borders on and is a part of the shoreline of the Dog River. Along a portion of the shoreline, the City built a pier, bulkheads, and a pavilion containing a food concession and a public restroom facility. The park is open to the public and no admission fee is charged. In an affidavit in support of the City’s motion for summary judgment, the Mobile Parks Superintendent stated that the City “has never operated a swimming facility at Luscher Park.”

Glover contends, however, that whirlpools in the water in front of the pavilion create a dangerous situation for those who do swim in the river, and that the City knew or should have known of the danger to the general public. Glover’s two minor sons drowned in the Dog River while visiting Luscher Park in June of 1978.

Plaintiff alleges both negligent performance and wanton breach of the City’s implied contract with the general public to take reasonable steps for water safety at the park and that both decedents were third party beneficiaries of that implied contract; that Luscher Park was an attractive nuisance because of the accessibility and alluring nature of the water; and that the City could have undertaken reasonable and feasible ways to remove or lessen the dangers posed by the deep water and whirlpools. Plaintiff also maintains that the provisions of Code 1975, § 35-15-1 et seq., are both unconstitutional and inapplicable to the instant case.

We note that § 35-15-1 et seq., enacted by the Legislature in 1965 as Act 463, was passed:

“[t]o clarify and codify the common law with respect to the duty of care owed by landowners towards the persons who may be upon their premises for hunting, fishing, sporting or recreational purposes and not for purposes connected with the landowner’s business.”

The statute itself provides:

“§ 35-15-1.
“An owner ... of premises owes no duty of care to keep such premises safe for entry and use by others for hunting, fishing, trapping, camping, water sports, hiking, boating, sight-seeing or other recreational purposes or to give any warning of hazardous conditions, use of structures or activities on such premises to persons entering for the above-stated purposes, except as provided in section 35-15-3. “§ 35-15-2.
“An owner ... of premises who gives permission to another to hunt, fish, trap, camp, hike, sight-see or engage in other sporting or recreational activities upon such premises does not thereby extend any assurance that the premises are safe for such purpose, constitute the person to whom permission has been granted the legal status of an invitee to whom a duty of care is owed or assume responsibility for or incur liability for any injury to person or property caused by an act of such person to whom permission has been granted, except as provided in section 35-15-4.
“§ 35-15-3.
“This chapter does not limit the liability which otherwise exists for wilful or malicious failure to guard or warn against a dangerous condition, use, structure or activity; or for injury suffered in any case where permission to hunt, fish, trap, camp, hike or sight-see was granted for commercial enterprise for profit; or for injury caused by acts of persons to whom permission to hunt, fish, trap, camp, hike or sight-see was granted to third persons as to whom the persons granting permission, or the owner ... of the premises owed a duty to keep the premises safe or to warn of danger. “§ 35-15-4.
“Nothing in this chapter creates a duty of care or ground of liability for injury to person or property.
“§ 35-15-5.
“Nothing in this chapter shall be construed as granting or creating a right for any person to go on the lands of another without permission of the landowner.”

Although the question of the applicability of § 35-15-1, et seq., to a municipality/landowner has not been addressed by this Court, we find that any discussion of that issue here would merely be an exercise in academics. The established rules of premises liability sufficiently resolve the pivotal question here of the City’s duty to Plaintiff’s sons because:

“[ejvery theory of negligence works around to the question whether some one did or failed to do what a reasonably prudent and competent man would be expected to do under given circumstances. In determining what precautions were reasonably necessary and incumbent upon the defendant in the use of its property at the place in question, it must be held to have considered the known extent and nature of the use to which the place was customarily put by others than its owner.”

Sheffield Co. v. Morton, 161 Ala. 153, 161, 49 So. 772 (1909).

The common law principle to which the Legislature referred in its statement of purpose for the adoption of Act 463 was well-stated in W. S. Fowler Rental Equipment Co. v. Skipper, 276 Ala. 593, 165 So.2d 375 (1963):

“The duty of one who owns or is in possession of property towards a licensee is not only to abstain from inflicting intentional, willful or wanton injuries, but to refrain from exposing such licensee to new hidden dangers, such as traps, pitfalls or obstructions which arise through his active negligence. [Cites omitted.] A trap or pitfall need not be intentionally set to catch a licensee who has been using the premises. A statement to that effect in Alabama Great Southern R. Co. v. Campbell, [32 Ala.App. 348, 26 So.2d 124 (1946) ], must be read in the light of the exact holding in the case there cited, Hayward v. Drury Lane Theatre, 1917 2 K.B. 899, 914, where it was said:
“ ‘. .. The owner is under no liability as to existing traps unless he intentionally set them for the licensee, but must not create new traps without taking precautions to protect licensee against them... ’
“This duty does not restrict the owner or possessor’s right to make use of the property or to make such changes therein as he may desire, but requires him, if he does any positive act creating a new danger to a person who may exercise the license, to give to such licensee reasonable notice or warning of the new danger or to exercise reasonable care to provide safeguards against such new danger. [Cites omitted.]”

W. S. Fowler, at 276 Ala. 600, 165 So.2d 375.

Both the statute and the Fowler decision were considered and approved in Wright v. Alabama Power Company, 355 So.2d 322 (Ala.1978), wherein this Court held:

“As we read the Fowler decision, it stands for the proposition that a landowner will generally owe no duty to warn a licensee of a potentially dangerous condition unless he does some positive act which creates a new hidden danger, pitfall or trap, which is a condition that a person could not avoid by the use of reasonable care and skill. [Cite omitted.] Otherwise, a landowner has the right to make use of his land as he may see fit. [Cite omitted.] The licensee’s entrance on the land carries with it no right to expect the land to be made safe for his reception, but he must assume the risk of whatever may be encountered. [Cites omitted.] Once he is there, the law only requires the landowner to refrain from wantonly, maliciously or intentionally injuring him; in other words, the landowner is not liable unless he does some act which goes beyond mere negligence.”

Wright v. Alabama Power Company, at 355 So.2d 325.

We find no allegation by Plaintiff that the City did some positive act creating a new hidden danger, unavoidable through the use of reasonable care and skill. On the contrary, rather than avoiding the waters of the Dog River, Plaintiff’s sons intentionally subjected themselves to possible dangers there by entering the water to swim. Further, in light of the City’s policy of “no swimming” at Luscher Park, we find no evidence that the City maliciously, willfully or intentionally failed to warn against a potentially dangerous condition.

As to the possibility of the whirlpools’ constituting an unreasonably dangerous condition, we note this Court’s further language in Wright, supra:

“The pivotal question is whether a submerged fence can be classified as a trap or pitfall. Applying the facts of this case to the law, we hold that this fence was not a hidden trap or pitfall. In Great Southern R. Co. v. Green, 276 Ala. 120, 159 So.2d 823 (1964), this Court stated:
“ ‘Submerged conditions hidden by the water, but adding to the danger of a trespasser entering the pool are not to be regarded as a pitfall or trap. ... ’
“Even though the Green decision involved the death of a trespassing child, the definition of a trap or pitfall with regard to submerged objects found in bodies of water is controlling.”

Wright, at 355 So.2d 325, 326.

While the whirlpools are certainly not “objects” or “bodies,” as was the fence in Wright, the definition, as found in the Green decision, uses the word “condition.” The “condition” of the whirlpools in the Dog River, then, was not created by the City’s act of developing Luscher Park nor can it be classified as a trap or pitfall. Further, by simply recognizing and abiding by the City’s intended uses of Luscher Park, the dangerous propensities of the water can reasonably be avoided.

Because the City owed no further duty to Plaintiff’s sons than that set out in Wright, supra, and because the City has not breached that duty, we find that summary judgment as to the City’s alleged negligence or wanton breach of an implied contract with Plaintiff’s sons was entirely proper.

Similarly, summary judgment as to the count of attractive nuisance was properly entered by the trial court. In Bailey v. City of Mobile, 292 Ala. 436, 296 So.2d 149 (1974), this Court considered an action against the City for the drowning deaths of two children in a deep drainage ditch. The Court denied liability and held:

“Finally, this court said in Mayo v. Mobile Asphalt Co., 272 Ala. 442, 131 So.2d 881:
“ ‘We have held that water hazards are not dangerous instrumentalities and no legal duty is imposed on the owner of property to erect barriers, or other safeguards to protect children, not invitees, from water hazards. Cobb v. Lowe Mfg. Co., 227 Ala. 456, 150 So. 687.’ ”

Bailey, at 292 Ala. 439.

We hold, then, that the trial court was correct in entering summary judgment for Defendant City of Mobile and in denying Plaintiff’s motion to reconsider. That judgment is due to be, and is hereby, affirmed.

AFFIRMED.

TORBERT, C. J., and FAULKNER, AL-MON, SHORES, EMBRY, BEATTY and ADAMS, JJ., concur.

JONES, J., dissents.

JONES, Justice

(dissenting).

I respectfully dissent.

Applying § 35-15-1 to the City’s operation of a public park, the majority has extended the equation of the minimum duty owed by landowners to trespassers and licensees to invitees. While most states have advanced their jurisprudence to abolish the distinction between the status of invitees and licensees, this Court has today taken a backward step; and, instead of advancing the status of the occupier of another’s premises, it has lowered the status of an invitee to that of a licensee and a trespasser. (Indeed, the Restatement, cited infra, would impose liability upon the landowner even as to a licensee under the instant circumstances.)

I cannot read § 35-15-1 as expressing a legislative intent to lower the standard of care owed by a city to users of public lands. With large tracts of land suitable for hunting, fishing, etc., becoming vested in fewer and fewer private owners, § 35-15-1 finds its beneficient purpose in protecting such owners from the traditional invitee standard of care in order that more property will be made available for outdoor sports. The statute accomplishes this purpose by “clarifypng] .. . the common law” with respect to licensees; and, then, in effect, classifying one who may be upon the premises for such purposes, not “connected with the landowner’s business,” as a licensee.

The statutory scheme espoused in § 35-15-1 simply does not embrace the user of a municipal park. Such property is, by its very nature, public land; and those who use it were not intended by the statute to be reduced to the status of a licensee. One who uses a public park is an invitee; and I do not believe § 35-15-1 alters the common law degree of duty on the part of the city toward an authorized user — that duty being one of due care. To hold otherwise — as the majority does — is to hold that the city owes the duty of reasonable care in its construction and maintenance of city streets but only the duty not to wilfully or maliciously injure one who uses its public parks. Above all else, the law ought to make sense. The application of § 35-15-1 to a city park, in my opinion, does not make sense. See Restatement (Second) of Torts, § 342, Dangerous Conditions Known to Possessor (1974).


author: BEATTY, Justice. BEATTY, Justice.

text:
    NATIONAL SECURITY FIRE & CASUALTY COMPANY, a corporation, and National Security Insurance Company, a corporation, et al. v. Stanley R. BOWEN.
    80-784.
    The Supreme Court of Alabama.
    May 11, 1982.
    Rehearing Denied July 16, 1982.

      John B. Givhan of Albrittons & Givhan, Andalusia, for appellants.

      Griffin Sikes of Tipler, Fuller & Sikes and Earl V. Johnson, Andalusia, for appel-lee.
   BEATTY, Justice.

Appeal by National Security Fire & Casualty Company and National Security Insurance Company (National) from an adverse judgment in an action brought by Stanley R. Bowen. We reverse and remand.

The cause grew out of Bowen’s purchase of certain used logging equipment, consisting of a skidder and a loader, from Jeffcoat Equipment, Inc., in Dothan. He executed a security agreement which was subsequently assigned to Commercial Credit Equipment Corporation in Montgomery. The $26,-572.50 purchase price included a one-time premium of $765.00 for property damage insurance in the amount of $25,000.00 for one year’s coverage beginning September 13,1976. The premium was paid to Lomax Johnson Insurance Agency in Dothan which placed the coverage with National. The policy contained a standard loss payable clause naming Commercial Credit as mortgagee.

In late November 1976, Bowen informed the agency that his skidder had been stolen and discovered under water in a creek. When notice of this claim was received by National, it was assigned by Rufus D. Johnson, National’s assistant vice-president for claims (who had authority to approve or disapprove them) to Murray McCall, an independent adjustor in Geneva, for the purpose of appraisal of the damage and adjustment. In due course the skidder was repaired by Jeffcoat Equipment, Inc., and National paid Jeffcoat $5,389.64, the full amount of the claimed loss.

On or about April 12, 1977, Bowen informed the Lomax Johnson Agency of another loss, not only to the skidder but also to the loader. He stated that he had left the equipment in the woods overnight and it had burned. Bowen stated that he was not sure of the cause. This information was telephoned to Rufus D. Johnson who contacted Murray McCall, requesting him to investigate the loss. McCall was unable to do so; therefore, Johnson telephoned Gene Bosché, president of Beneficial Investigative Services, Snellville, Georgia. Johnson had received correspondence from Bosché describing the latter’s adjusting and investigative organization, together with a description of the experience of his staff. Bosché was asked to determine whether the fire was arson and, if so, to determine the identity of the arsonist. Johnson followed up this conversation with a confirming letter which included copies of the policy and the loss notice. Neither Johnson nor anyone else in National’s office participated in the investigation, Johnson’s instructions being, as shown by his letter to Bosché:

“It is my understanding that your investigator will call me before he leaves the area or concludes his investigation so that we can have an opportunity to discuss his file material and determine if any further investigation is merited.”

Bosché and his vice-president, Ed Pierson, went to Covington County and conducted an investigation. Their report was made in the latter part of May 1977 and included Bowen’s statement of loss, in which he asserted that the actual cash value of the equipment was $60,000.00 and claimed $25,-000.00 under the policy; a sketch map positioning the vehicles; photographs; and the investigator’s statement describing his interviews with Bowen, with a representative of Commercial Credit Equipment Company in Montgomery, with a sheriff’s department investigator, and with Ronnie Worrell and Louis “Frog” Williamson. The investigator’s conclusion was that the case was one of arson committed by Bowen.

On July 26, 1977, National paid Commercial Credit $18,995.59, the amount of the unpaid balance due them under their security agreement, but did not pay Bowen the difference between the amount of their insurance policy, $25,000.00, and the $18,-995.59 because, according to Rufus D. Johnson, on the basis of the investigative report, there was evidence, which he believed, that Bowen had burned the equipment.

Meanwhile, in June 1977, Bowen had been indicted by the grand jury of Coving-ton County for the offenses of arson in the third degree and false pretenses. His trial in December 1977 resulted in a mistrial, and the charges were nol-prossed in March 1978.

This action was filed on June 16, 1978. Bowen’s complaint contained counts for malicious prosecution; “intentional and malicious harrassment” (outrageous conduct); willful failure to pay and fraud; and conspiracy. By amendment Bowen struck his original ad damnum demand and substituted a demand for “Two Million Five Hundred Thousand ($2,500,000.00) Dollars” in each of his Claims One, Two and Three. Claim Four was dismissed. Trial ensued against National as the only defendant on May 25,1981. National moved for a directed verdict separately as to each claim. Ultimately a jury returned a verdict for $250,-000.00 on which judgment was entered. National then moved for judgment NOV, or a new trial, both of which were denied. This appeal followed from the final judgment and the denial of the defendant’s post-trial motions.

Issues I and III posed to us by the defendant, National, deal with Claim Three of the complaint. The pertinent portions of that claim follow:

“3. The substance of the agreement, to-wit, heretofore mentioned policy of insurance, is as follows: Defendants, National Security, agreed to pay the plaintiff and/or his mortgagee under loss payable clause as such mortgagees’ interest appears, in exchange for payment of premiums for a loss incurred by fire to plaintiff’s equipment and machinery.
“4. The plaintiff alleges that although he has complied with all the provisions of said agreement on his part, defendants, National Security, have willfully or wantonly failed to pay the plaintiff’s loss incurred by reason of a fire which occurred on or about, to-wit, April 12, 1977, during the term of said policy and while the same was in full force and effect; notice of which was given to said defendant corporations on or about May 2,1977.
[Emphasis added.]
“5. Plaintiff further alleges that said defendants, National Security, fraudulently and falsely represented to plaintiff that valid claims under the above mentioned policy would be paid, knowing that such statements were false; that said defendants, National Security, issued said policy and accepted premiums therefor, with the present intent not to honor valid claims thereunder.
“6. Plaintiff adopts the allegations of Paragraphs 1, 2, 3, 4 and 5 and assigns the same to defendants 1, 2 and 3, being those persons, firms, partnerships, or other legal entities responsible for the fraudulent misrepresentations made to the plaintiff, whose true names are otherwise unknown to the plaintiff but whose true names will be substituted by amendment when ascertained by the plaintiff.”

National contends that the trial court erroneously construed these allegations as stating a cause of action against it based upon its “bad faith refusal to pay a direct claim.” National maintains that the allegations of Claim Three fall within and state a cause of action for “fraudulent inducement” under Old Southern Life Ins. Co. v. Woodall, 295 Ala. 235, 326 So.2d 726 (1976). See also Old Southern Life Ins. Co. v. Woodall, Ala., 348 So.2d 1377 (1977). The defendant objected to the plaintiff’s reference in his opening statement to Claim Three as a “claim of tort of bad faith,” and contended then and now that “bad faith” was not in issue. Thus, argues the defendant, it was reversible error for the trial court not to grant its motion for a directed verdict specifically directed to Claim Three and for the trial court’s giving three jury charges pertaining to the tort of bad faith refusal.

We have carefully compared the allegation of Claim Three with those in each of the Woodall decisions, and we agree with the defendant that they are strikingly similar, extremely so. The question, however, is whether those allegations would give notice of a bad faith claim. While it would have been preferable for plaintiff to initially have stated a “bad faith” claim with at least the same particularity as his “fraudulent misrepresentation” claim, nevertheless, because that issue has been tried, in the interest of liberality in pleading, his failure to do so was not fatal in this case. Rule 8, Alabama Rules of Civil Procedure; Rule 9(b), ibid. The plaintiff’s allegations of a willful or wanton failure to pay after he had fully complied with the contractual provisions, and of the false representations that valid claims would be paid knowing that such statements were false, were sufficient under notice pleading to apprise defendant that evidence of the bad faith theory might be introduced. As stated in 5 Wright & Miller, Federal Practice and Procedure, § 1216 at 121-123:

“[T]he complaint must contain either direct allegations on every material point necessary to sustain a recovery on any legal theory, even though it may not be the theory suggested or intended by the pleader, or contain allegations from which an inference fairly may be drawn that evidence on these material points will be introduced at trial... . ”

Indeed, an intentional failure to pay a valid claim might result from misrepresentations knowingly made that valid claims would be paid in the future. Certainly, therefore, such allegations as those we have referred to would be sufficient upon which to introduce proof of the elements of the tort of bad faith refusal.

The defendant’s attack upon the merits of that claim, however, is well taken.

An insurer is liable for its refusal to pay a direct claim when there is no lawful basis for the refusal coupled with actual knowledge of that fact. Chavers v. National Security Fire Ins. Co., Ala., 405 So.2d 1 (1981). No lawful basis “means that the insurer lacks a legitimate or arguable reason for failing to pay the claim.” Gulf Atlantic Life Ins. Co. v. Barnes, Ala., 405 So.2d 916 (1981). When a claim is “fairly debatable,” the insurer is entitled to debate it, whether the debate concerns a matter of fact or law. Ibid.

Under those authorities the plaintiff in a “bad faith refusal” case has the burden of proving:

(a) an insurance contract between the parties and a breach thereof by the defendant;
(b) an intentional refusal to pay the insured’s claim;
(c) the absence of any reasonably legitimate or arguable reason for that refusal (the absence of a debatable reason);
(d) the insurer’s actual knowledge of the absence of any legitimate or arguable reason;
(e) if the intentional failure to determine the existence of a lawful basis is relied upon, the plaintiff must prove the insurer’s intentional failure to determine whether there is a legitimate or arguable reason to refuse to pay the claim.

In short, plaintiff must go beyond a mere showing of nonpayment and prove a bad faith nonpayment, a nonpayment without any reasonable ground for dispute. Or, stated differently, the plaintiff must show that the insurance company had no legal or factual defense to the insurance claim.

The “debatable reason” under (c) above means an arguable reason, one that is open to dispute or question. Webster’s Third New International Dictionary (1931) at 116. See Chavers at 10; see also Embry, J., concurring on rehearing in Aspinwall v. Gowens, Ala., 405 So.2d 134 (1981).

Applied to this case these principles cause us to inquire into the evidence establishing the reasons which prompted Rufus D. Johnson to recommend not paying Bowen the balance due under the policy. In exploring those reasons we must consider the information before Johnson at the time he made the decision not to pay Bowen.

The record shows that when Johnson was first informed of the fire loss by Grace Peacock of the Lomax Johnson Agency in Dothan “she felt that it was a loss that might need some looking into.” When he learned that Murray McCall would not handle the investigation, he called Beneficial Investigative Services. He testified that he had just received a letter and resume from them announcing the formation of their company. He added: “[T]he background of the people that they listed looked fairly impressive and I thought that they might do a good investigation on it.” So he called their office and asked them to do an investigation as to the cause of the fire, to see if it was arson and “if it could be proven who the arsonist was.” He wrote a confirming letter that day enclosing a copy of the loss notice and a copy of the front page of the policy. While talking with Gene Bosché he was assured by him that they were competent and experienced. The letter and description of Beneficial’s services which were received by Johnson stated that Beneficial had received National’s name and address from one Lindsey McGarity, Assistant Deputy Insurance Commissioner, Rating Division, State of Georgia. It was accompanied by another letter describing the qualifications of five full- and part-time investigators and soliciting National’s business. During Johnson’s conversation with Bosché, he inquired about licensing and was told that Bosché was licensed.

Following that initial conversation, his next contact with Beneficial occurred when either Gene Bosché or Ed Pierson came by his office in Elba. This caller informed Johnson that the sheriff’s department was also investigating the matter. This Beneficial representative showed Johnson his Georgia investigator’s license.

Subsequently, Johnson received the investigative report dated May 9, 1977, to which we have alluded earlier, and which was admitted into evidence in the trial below. The report described a visit to the scene of the fire in company with plaintiff who also operated a combination service station and grocery store. They proceeded to the rural area where the burned vehicles were standing in close proximity to one another. An unburned logging trailer, uninsured, was standing nearby. The investigator reported taking photographs of the scene, making sketches, and taking samples of the soil and remnants of the vehicles’ tires which retained an odor of distillates. He reported that plaintiff disclaimed knowledge of the cause of the fire, that he had come to the scene the afternoon before the fire with a tank truck to refuel the vehicles and did so, after which he and his crew departed. Bowen stated that other investigators had taken samples from the area and had sent them to the State Fire Marshal’s Office. The investigator also reported that Bowen had revealed to him that his house trailer had burned in January 1977 from an unknown cause while he and his wife were absent.

The report received by Johnson also described a visit to the scene of the fire by the Beneficial investigator in company with a sheriff’s department investigator. It described the area as being flat and dry and having sandy soil, which had been soaked with some form of distillate. The report contained the observation that the interior of the truck was saturated with fuel and the doors closed after ignition, causing the windows and doors to explode outward. It reported the sheriff’s investigator as stating that Bowen’s tank truck was parked near the scene when the fire started and that a trail of fuel had been poured some 50 to 75 yards long leading to the area where the vehicles were parked.

. The Beneficial investigator also reported on an interrogation of Ronnie Worrell conducted with the sheriff and his chief deputy. A synopsis of this statement was contained in the report, and it implicated Bowen and “Frog” Williamson in a scheme to collect insurance money by overheating the engine of his equipment, running it in a creek, and then reporting it stolen. Also reported was a statement taken by the chief deputy sheriff and the insurance investigator from “Frog” Williamson, one of Bowen’s employees. Williamson gave a statement naming Bowen as the arsonist responsible for the burning of the equipment on April 12, 1977. Both the Worrell and the Williamson statements were submitted to Johnson with the report.

The report also described a later meeting when a statement was taken from Bowen who disclaimed knowledge of enemies who would burn his equipment. An interview with a representative of Commercial Credit was also included. It described Bowen’s account as delinquent, and Bowen as a poor financial risk with a poor record of payment on prior loans as well.

The investigator’s conclusions were reported also:

“This is a deffinate [sic] case of ARSON. Area and equipment were saturated with distillates prior to fire. 6' X 28" Tires were totally destroyed in fire, along with all other tires, hoses, and upholstery in all vehicles. SUBJECT gambles, drinks, and has been involved with prior fires and equipment losses in 1976 and 1977. SUBJECT displayed nervousness during questioning and AGENT believes that SUBJECT destroyed his own equipment. SUBJECT was known to be behind on payments (MOTIVE), owns tank truck for re-fueling which was reported at the scene (MEANS), and was at the scene the day of the fire (OPPORTUNITY).”

Plaintiff seeks to impeach the position of National by insisting that the evidence at the trial showed that National set out to “frame” Bowen through criminal prosecution and other “forms of harrassment,” thus forcing him to abandon his insurance claim. We take note of the fact that the record does show a trial of Bowen on a false pretense charge and a mistrial, followed by a nolle prosequi upon the recommendation of the district attorney, apparently because of information impeaching one of the witnesses, “Frog” Williamson. We reiterate, however, that to establish “no lawful basis” for refusing to pay a claim, the plaintiff must show that the insurer lacked any legitimate or arguable reason for not paying the claim. If his evidence fails to eliminate any arguable reason for denying payment, any fairly debatable reason on a matter of fact or a matter of law, he cannot recover under the tort of “bad faith refusal.”

We cannot conclude, therefore, that plaintiff has shown any evidence eliminating any arguable reasons for Johnson’s refusal to pay plaintiff’s claim. Indeed, Johnson’s reliance upon the report submitted to him and the concomitant circumstances surrounding it furnished him with ample debatable reason. The responsibility for setting the fire, as revealed by that report, was certainly open to question, as the paralleling official investigation itself tends to establish. It was error, therefore, for the trial court to deny the defendant’s motion for a directed verdict as to Claim Three.

The case was submitted to the jury on Claims One, Two and Three. The defendant moved for a directed verdict specifically against Claim Three. In this situation

“if a complaint has more than one count and the defendant believes that the evidence is not sufficient to support one or more of those counts, he must challenge this by motion for directed verdict, specifying the count which is not supported by evidence and detailing with specificity the grounds upon which the particular count is not supported by the evidence. If this is not done and all counts go to the jury and a general verdict is returned, the court will presume that the verdict was returned on a valid count.”
Aspinwall v. Gowens, Ala., 405 So.2d 134 (1981) (on rehearing).

The defendant’s motion for a directed verdict asserted the following grounds:

“a. The Plaintiff has failed to prove a prima facie case.
“b. The Plaintiff has failed to prove any facts from which the jury would be entitled to infer that these Defendants fraudulently and falsely represented to the Plaintiff that valid claims would be paid, with the present intent at the time of issuing the alleged policy and accepting premiums therefor not to honor valid claims thereunder.
“c. The evidence establishes without contradiction that claims were paid under the alleged policy.”

In considering the requirement of specificity as applied to these grounds, we take note of defendant’s position that Claim Three was grounded upon Woodall, supra, fraud. We have recognized that striking resemblance while giving the allegations of Claim Three a liberal interpretation on the ground that an intentional failure to pay a valid claim might be inferred in a given case from evidence of misrepresentations knowingly made that valid claims would be paid in the future, although the usual proof of fraud might be to the contrary. See dissenting opinion of Torbert, C. J., in As-pinwall, supra. Applying that same reasoning equally on behalf of the defendant and to the plaintiff, we conclude that the defendant’s motion sufficiently raised the absence of evidence of a bad faith claim under item (b). Ground (c) accords with this Court’s view later expressed in the case of Sexton v. Liberty National Life Ins. Co., Ala., 405 So.2d 18 (1981), where payment under the policy took away the issue of bad faith refusal to pay. Together, grounds (b) and (c) were sufficient in questioning the absence of a refusal based upon bad faith, i.e., a dishonest purpose.

Because the case must be reversed for the reasons we have stated, it is unnecessary to address other issues raised by the defendant. For the error refusing the directed verdict as to Count Three, the judgment must be, and is, reversed and the cause is remanded with instructions to enter a judgment for the defendant on Count Three and to grant defendant a new trial.

REVERSED AND REMANDED WITH DIRECTIONS.

FAULKNER, JONES, SHORES, EM-BRY and ADAMS, JJ., concur.

TORBERT, C. J., and MADDOX and AL-MON, JJ., concur in result.

ON APPLICATION FOR REHEARING

BEATTY, Justice.

Plaintiff takes us to the woodshed for our statement that “[njeither Johnson nor anyone else in National’s office participated in the investigation.” He contends that this statement is erroneous because, as he maintains, the evidence discloses that Johnson was present when, allegedly, an attempt was made to bribe a witness. We alluded to this conduct in the original opinion and, after another examination of the record, we adhere to our earlier observation that there was no evidence of active participation by Johnson in the field investigation which led to the denial of Bowen’s claim. Any other conduct by Johnson or others may be the subject of retrial on other issues if that occurs.

In any case we reiterate that the plaintiff did not adduce evidence eliminating arguable reasons for the insurance company’s refusal to pay. Consequently, that element of the bad faith refusal claim was never established.

OPINION EXTENDED; APPLICATION FOR REHEARING OVERRULED.

TORBERT, C. J., ' and FAULKNER, JONES, SHORES, EMBRY and ADAMS, JJ., concur.

ALMON, J., concurs in the result.

MADDOX, J., not sitting.


author: HOLMES, Judge.

text:
    Britt HENDON, et al. v. CITY OF FLORENCE.
    Civ. 2598.
    Court of Civil Appeals of Alabama.
    Feb. 4, 1981.
    Rehearing Denied March 4, 1981.

      J. Wm. Thomason of Thomason & Russell, Bessemer, and Clarence M. Small of Rives, Peterson, Pettus, Conway, Elliott & Small, Birmingham for appellants.
    Frank V. Potts of Potts, Young & Blasin-game and Arnold Teks, Florence, for appel-lee.
   HOLMES, Judge.

The Chief of Police of Florence, Alabama, dismissed twenty-eight policemen. The policemen appealed their termination to the Civil Service Board of the City of Florence. The board held an evidentiary hearing, after which it affirmed the chief’s action. The policemen then appealed to the Circuit Court of Lauderdale County for a trial de novo pursuant to Act No. 1619, Acts of Alabama 1971.

The circuit court granted summary judgment in favor of the City of Florence and the policemen appeal to this court.

As stated above, this appeal arises out of the dismissal of twenty-eight policemen. Those twenty-eight policemen, and six others, went on strike on December 5, 1979. On December 7, the chief issued written orders for the strikers to return to work. The orders stated that the policemen would be suspended if they did not “return to work at 7:00 o’clock a. m., CST, Monday, December 10, 1979.”

On December 10 at 2:00 P.M., strike representatives met with other union representatives and city officials and the deadline for returning to work was extended until 11:00 P.M. on the 10th. Six strikers returned to work before the extended deadline expired; they were not punished.

On December 11, the chief mailed termination letters to the remaining strikers. On December 18, the chief, pursuant to the rules and regulations of the Florence Civil Service Board, filed six formal charges against each striker. An evidentiary hearing was held on January 28; all of the striking policemen were present or represented at the January 28th hearing. The Civil Service Board affirmed the termination on January 29.

Pursuant to Act No. 1619, Acts of Alabama 1971, the policemen appealed to the Lauderdale County Circuit Court for a jury trial de novo on February 8. Attached to the notices of appeal were copies of the board’s decision in each case. The city filed a motion to dismiss, which was later denied. The city then filed a motion for summary judgment and attached the affidavits of the police chief and the city commissioner in charge of the police department. A transcript of the board’s hearing was also attached. In response to the motion, the policemen offered the affidavit of Sergeant John Baugh. The circuit judge, based on the evidence before him, found that there was no material fact at issue and granted the city’s motion for summary judgment.

The dispositive issue on appeal is whether the trial court erred in granting summary judgment.

The policemen contend on appeal that there are several issues of material facts which should have prevented the judge below from granting summary judgment. Those issues are: (1) whether the policemen committed acts justifying adverse personnel action; (2) whether the terminations were motivated by a desire to suppress the policemen’s First Amendment right of association with a union; and (3) whether the policemen were afforded procedural due process. We will address the issues raised by the policemen in the order given above.

1. Whether the policemen committed acts justifying adverse personnel action:

The material facts regarding this issue are undisputed. The Manual of Rules and Regulations of the Police Department of the City of Florence provides, inter alia, that members of the department are subject to disciplinary action for absence from duty without leave or authorized permission and for failure to comply with oral or written orders. Manual, supra, § 3.35.13.33; § 3.37.11. The Manual also provides that members who are found guilty of violating a rule, regulation or order “shall be subject to reprimand, suspension, dismissal, or suffer such • other disciplinary action as the Chief of Police may impose.” Manual, supra, § 3.35.13.

The Rules and Regulations of the Civil Service Board of Florence, Alabama provide, inter alia, that when “the head of any department or office suspends, removes, discharges or demotes any employee,” the employee may appeal to the board. Rules and Regulations, supra, Chapter IV, § 1. If the board finds the employee guilty of the charges, the employee “shall be subject to reprimand, suspension, discharge or suffer such other lawful punishment as the Civil Service Board may direct.” Id. Chapter IV, § 3.

It is undisputed that thirty-four policemen went on strike and were therefore absent without leave, which is a violation of the rules and regulations of the police department. It is also undisputed that twenty-eight policemen failed to return to work when ordered to do so by the chief of police, which is also a violation of the department’s rules and regulations. The policemen’s actions clearly made them subject to discipline and both the chief of police and the board had the authority to dismiss them.

Neither did their dismissal on the grounds stated above violate the policemen’s constitutional rights. United Steel Workers of America v. University of Alabama in Birmingham, 430 F.Supp. 996 (N.D.Ala.1977), aff’d, 599 F.2d 56 (5th Cir. 1979). Government employees do not have a constitutionally protected right to strike. United Federation of Postal Clerks v. Blount, 325 F.Supp. 879 (D.D.C.1971) (three judge court), aff’d, 404 U.S. 802, 92 S.Ct. 80, 30 L.Ed.2d 38 (1971).

In light of the above, the trial court was clearly correct in granting summary judgment on the issue of whether the adverse personnel action against the policemen was justified, as there was no factual dispute regarding the actions of the policemen or the authority of the defendants to discipline them.

2. Whether the charges and disciplinary action were motivated by a desire to suppress the policemen’s First Amendment right of association with a union:

The policemen contend on appeal that their dismissal was illegally motivated by a desire to punish them for association with a union. They base this contention on the fact that one of the charges filed by the chief against them was affiliation with an “organization which maintains that it has a right to cause its members to strike against a public body,” and by the chief’s testimony before the civil service board hearing that a “motivating factor” in his decision to dismiss the policemen was their membership in such an organization.

The policemen rely on Mt. Healthy City School District Board of Education v. Doyle, 429 U.S. 274, 97 S.Ct. 568, 50 L.Ed.2d 471 (1977), for the proposition that a desire to penalize or suppress the exercise of First Amendment rights must not play a “substantial part” in the decision to dismiss an employee. In Mt. Healthy, it was the motivation of the board of education, which had the ultimate authority to hire and fire, that was in question.

We note that the Chief of Police of the City of Florence has the authority to dismiss members of his department. Rules and Regulations of the Civil Service Board of Florence, Alabama, Chapter IV, § 1(a). However, the exercise of that authority is subject to review by the Civil Service Board, and the board may substitute its judgment for that of the chief. Id. at § 1(a); § 3.

In this case, the board found the policemen “not guilty” of the charge regarding affiliation with an organization which maintains its members have a right to strike against a public body. As a consequence, the chief’s motivations regarding union membership become immaterial. Therefore, the trial judge did not err in granting motion for summary judgment in this regard.

3. Whether the policemen were afforded procedural due process:

The minimum requirements of due process as regards dismissal of a public employee are found in Thurston v. Dekle, 531 F.2d 1264 (5th Cir. 1976). Basically, the Thurston standard requires written notice of the charges and a hearing on them prior to termination.

In this case, the policemen were given written notice of the charges at the time they were terminated and were given a hearing only after termination. Nevertheless, any error regarding the above action was cured by the subsequent post termination proceedings before the Civil Service Board that included written notice of the charges and a public hearing during which each employee was represented by an attorney and provided an opportunity to present witnesses and cross-examine opposing witnesses. Thompson v. Bass, 616 F.2d 1259 (5th Cir. 1980); Glenn v. Newman, 614 F.2d 467 (5th Cir. 1980). Accord, Jefferson County v. Reach, Ala., 368 So.2d 250 (1979).

The policemen also contend that the trial judge erred in finding that the strike created an “emergency” which allowed the suspension of the Thurston standards. This contention is based on the argument that the existence of an emergency is a factual question for the jury. In light of the discussion above, we find that the existence or nonexistence of an emergency is irrelevant in the case on appeal. Consequently, the trial judge did not err in granting summary judgment on grounds that the policemen were not afforded procedural due process.

The policemen also raise a fourth issue regarding the propriety of granting summary judgment in this case. They contend that, even if their actions justify some disciplinary action, the question of the proper punishment was one for the jury and that it should have gone to the jury.

Act No. 1619 provides for an appeal from the Civil Service Board’s action by trial de novo in the circuit court. The Act further provides for trial by jury on demand. A trial de novo is a new trial in which the whole case is gone into as if no prior proceedings had occurred. Alabama Equity Corp. v. Hall, 46 Ala.App. 143, 239 So.2d 215, cert. denied, 286 Ala. 731, 239 So.2d 220 (1970). It is clear that the Civil Service Board on appeal may substitute its judgment regarding punishment for that of the police chief. Rules and Regulations of the Civil Service Board of Florence, Alabama, Chapter IV, § 3. Because Act No. 1619 provides for a trial de novo wherein a jury may consider the entire case a jury may determine the question of appropriate punishment, if properly raised, and substitute its judgment on that question for that of the Civil Service Board. Smith v. Civil Service Board of the City of Florence, 52 Ala.App. 44, 289 So.2d 614 (1974).

We find that the question of a right to a jury determination of punishment was properly raised in this case. The notice of appeal which the policemen filed in the circuit court stated that the appeal was taken from an adverse ruling of the Civil Service Board. The board’s ruling clearly included a finding that the dismissal was proper punishment. Furthermore, the parties do not seriously contend that the question of punishment was not properly raised in the circuit court.

Where a party appeals pursuant to Act No. 1619 and demands a jury, such as we have in this instance, the question of punishment is a question for the jury. For the reasons stated above, we find that the trial judge erred in granting the board’s motion for summary judgment on this ground.

As indicated above, this court has no alternative in view of Act No. 1619 but to reverse the trial court’s action in granting summary judgment. However, our reversal, as shown above, is premised on the conclusion that the policemen were in this instance entitled to a trial by jury on the issue of punishment.

While this court, as a general proposition, only decides those issues necessary to resolve the appeal, we have attempted to resolve other pertinent issues. We have taken this course of action to hopefully assist the learned and distinguished trial judge in this most difficult lawsuit.

The trial court may, if appropriate, in view of the above, utilize Rule 56(d), ARCP.

We would be remiss in not commenting that this court is aware of the practical consequences of our decision. These consequences were ably pointed out by the city during oral argument before this court. However, Act No. 1619 mandates our decision. It may well be that in view of the uniqueness of Act No. 1619 interested parties will reevaluate its efficacy.

REVERSED AND REMANDED.

WRIGHT, P. J., and BRADLEY, J., concur.