author: TORBERT, Chief Justice. JONES, Justice

text:
    The HOME INDEMNITY COMPANY, a Corp., et al. v. Pauline A. ANDERS, et al. Pauline A. ANDERS, et al. v. CITY OF MOBILE, a Municipal Corp., et al. The INSURANCE COMPANY OF NORTH AMERICA, as Subrogee of Springdale Stores v. CITY OF MOBILE, a Municipal Corp., et al. BROWN & BROWN OF DELAWARE, INC., et al. v. CITY OF MOBILE, a Municipal Corp., et al. PLEASANT VALLEY ASSEMBLY OF GOD v. CITY OF MOBILE, a Municipal Corp., et al. Frances N. ALDRIDGE, Individually, and Frances N. Aldridge, et al., as Executors of the Estate of Henri M. Aldridge, Deceased v. CITY OF MOBILE, a Municipal Corp., et al.
    82-902, 82-1162, 82-1195, 82-1196, 82-1204, and 82-1205.
    Supreme Court of Alabama.
    Sept. 14, 1984.
    Rehearing Denied in 82-902 Nov. 9, 1984.

      William H. Brigham, Mobile, for City of Mobile.
    G.B. McAtee, of Stokes & McAtee, Mobile, for Mr. and Mrs. Jeffery Watt, Mr. & Mrs. Ron Barrett, Mr. & Mrs. Danny Whitehead, and Mr. <& Mrs. Robert Turber-ville.
    Fred W. Killion, Jr. and Robert E. Clute, Jr., of Reams, Yollmer, Philips, Killion, Brooks & Schell P.C. Mobile, for Andrew and Lila Giardina.
    Fred W. Killion, Jr. and Lucian Gillis, of Reams, Vollmer, Philips, Killion, Brooks & Schell, P.C., Mobile, for Big Three Motors, Inc.
    Robert A. Beckerle, Mobile, for George Hayward Walker and George Ann Walker.
    Vaughan Drinkard, Jr., of Drinkard & Sherling, Mobile, for William J. and Joan Glisson.
    John W. Parker, Mobile, for Cleve and Laura Jackson, et al.
    Irvin Grodsky, of Grodsky & Mitchell, Mobile, for Emory K. Johnson, Bernice Johnson and Willie Mae Parker.
    Eugene De Martenson and Rebecca L. Shows of Huie, Fernambucq & Stewart, Birmingham, for The Home Indemnity Company, et al.
    Robert H. Smith, of Collins, Galloway & Smith, Mobile, for The Ins. Co. of North America, etc.
    Russell S. Terry, Mobile, for Brown and Brown of Delaware, Inc., et al.
    Thomas S. Rue and W. Alexander, of Johnstone, Adams, May, Howard & Hill, Mobile, for Pleasant Valley Assembly of God.
    Joel F. Danley and Ralph G. Holberg III, of Holberg, Tully, Holberg & Danley, Mobile, for Frances N. Aldridge, et al.

      John W. Parker, of McFadden, Riley & Parker, Mobile, for Jeremiah Lowney, Joe and Yanira Logan, Cleve and Laura Jackson.
    Joe H. Little, Jr. and Mary Beth Manti-ply, of Gaillard, Little, Hume & Sullivan, Mobile, for amicus curiae The Board of Water and Sewer Commissioners of the City of Mobile.
   TORBERT, Chief Justice.

In 1980 and 1981, several large storms passed over the City of Mobile (City). Widespread flooding caused extensive property damage. Hundreds of lawsuits were filed against the City. Most of the suits alleged that the City had been negligent in the design, construction, and maintenance of its sewer and drainage system. The City was insured by the Home Indemnity Company (Home). Disputes arose between the flood victims and the City and between the City and Home as to the extent of the City’s potential liability to the flood victims and the extent of Home’s coverage of the City under the insurance policy.

The City filed a declaratory judgment action on February 1, 1982, seeking in part a determination of what an “occurrence” was, both under the statute at issue, 1977 Ala.Acts, No. 673 (codified at Code 1975, § 11-93-1 through § 11-93-3) and under the facts in this case. Several defendants in the suit counterclaimed, contending § 11-93-2 was not applicable, or that if it was applicable it was unconstitutional, and that it did not contain an aggregate limitation on the recovery of property damage.

Defendants filed a motion for summary judgment on the counterclaim. On January 21, 1983, the trial court entered an order holding that § 11-93-2 was applicable, was constitutional, and contained an aggregate limitation on property damage of $100,000 for all judgments arising out of an “occurrence.” This order was made final pursuant to A.R.Civ.P. 54(b) on July 15, 1983.

The “occurrence” issue was tried in March of 1983, and an order, made final pursuant to A.R.Civ.P. 54(b), was entered on May 6, 1983. The court concluded in effect that each property owner who obtained a judgment against the City was injured as the result of a separate “occurrence.”

Home appeals from the order of May 6, 1983, and several flood victims cross appeal from the order of January 21, 1983, made final on July 15, 1983. The appeals of the various parties have been consolidated. We will address the issues raised on the cross appeals first, since they concern some threshold questions needing resolution before we address the “occurrence” issue.

Applicability

The flood victims contend that § 11-93-2 does not apply to this case. Their complaints seek recovery against the City on the grounds that there was a defect in a public improvement. They correctly argue that this is the second of two' grounds under Code 1975, § 11-47-190, for suing a municipality in tort, the first ground being that the City has vicarious liability for the neglect, carelessness, or unskillfulness of some agent, officer, or employee. See, e.g., Bailey v. City of Mobile, 292 Ala. 436, 296 So.2d 149 (1974); Hillis v. City of Huntsville, 274 Ala. 663, 151 So.2d 240 (1963). They argue that for the purposes of § 11-93-2 the definition of “claim” contained in § 11-93-1(5) only describes claims arising under the vicarious liability provision of § 11-47-190.

The first part of § 11-47-190 makes a municipality responsible for the negligent acts of certain classes of people who act for the municipality. The second part of § 11-47-190 codified common law decisions that a municipality was liable for damages caused by defects in public improvements, City of Prichard v. Kelley, 386 So.2d 403 (Ala.1980), even though the defect was not created by the negligence of the municipality’s employee. City of Tallassee v. Harris, 431 So.2d 1177 (Ala.1983). However, the municipality is responsible only if it has actual or constructive notice of the defect and fails to remedy it. Code 1975, § 11-47-190; City of Scottsboro v. Johnson, 436 So.2d 859 (Ala.1983).

A corporation can act only through its servants, agents, or employees. Martin v. Anniston Foundry Co., 259 Ala. 633, 68 So.2d 323 (1953). While § 11-47-190 refers to notifying “the council or other governing body,” it is that body’s culpable omission in failing to correct the defect once actual or constructive notice is given that creates liability in the municipality for damages that result. The definition of “employee” for purposes of § 11-93-2 includes officers, officials, employees, or servants. Code 1975, § 11-93-1(2). Therefore, the definition of “claim” in § 11-93-1(5) encompasses a situation, like that alleged in this case, where an official’s omission causes damages.

Constitutionality

The flood victims also contend that Act 673 is unconstitutional. The right to maintain a tort action against a local governmental entity has undergone a gradual expansion. Act 673 was passed in response to the gradual abolition of immunity. Roberts v. Meeks, 397 So.2d 111 (Ala.1981) (Maddox, J., concurring specially).

The abolition of immunity was not the result of this Court’s totally abolishing the immunity recognized at common law, but instead reflected this Court’s attempt to give effect to the Legislature’s intent, as set forth in several statutes, to waive immunity in certain circumstances. Parton v. City of Huntsville, 362 So.2d 898 (Ala.1978); Enterprise City Bd. of Education v. Miller, 348 So.2d 782 (Ala.1977). This Court has acknowledged that the Legislature has authority to provide any limitations or protections it deems necessary in this field, Jackson v. City of Florence, 294 Ala. 592, 320 So.2d 68 (1975), unless prohibited' by the Constitution. Enterprise City Bd. of Education v. Miller, 348 So.2d 782 (Ala.1977).

In determining whether the act is constitutional, we are bound by the following presumption:

“[I]n passing upon the constitutionality of a legislative act, the courts uniformly approach the question with every presumption and intendment in favor of its validity, and seek to sustain rather than strike down the enactment of a coordinate branch of the government. All these principles are embraced in the simple statement that it is the recognized duty of the court to sustain the act unless it is clear beyond reasonable doubt that it is violative of the fundamental law.”

Alabama State Federation of Labor v. McAdory, 246 Ala. 1, 9, 18 So.2d 810, 815 (1944).

With this background in mind, we find no constitutional impediment to the Legislature’s limiting the liability of local governmental entities. We note initially that while numerous grounds are advanced on appeal for finding the Act unconstitutional, our search of the record reveals that the only grounds raised both at trial and on appeal were the assertions that the Act violates the remedy provisions of Article I, § 13, and denies equal protection as guaranteed in Article I, § 1. This Court will not consider constitutional questions not raised below. Smith v. State, 280 Ala. 241, 192 So.2d 443 (1966).

The flood victims argue that § 11-93-2 is offensive because it limits tort liability of local governmental entities without doing the same for natural persons. The standard to be applied in determining whether § 11-93-2 will withstand an equal protection challenge is set forth in Reese v. Ran kin Fite Memorial Hospital, 403 So.2d 158, 161 (Ala.1981), as follows:

“[T]he court need only find that the classification made by the legislature is not arbitrary or unreasonable. As this court recently held in Tyson v. Johns-Manville Sales Corporation, 399 So.2d 263 (Ala.1981):

‘A statutory discrimination between classes is held to be relevant to a permissible legislative purpose if any state of facts reasonably may be conceived to justify it.’ ”

The City and Home contend that the statute was designed to protect the financial solvency of local governmental entities, while at the same time affording an injured party the possibility of recovering a substantial sum. A similar rationale was advanced in the case of Stanhope v. Brown County, 90 Wis.2d 823, 280 N.W.2d 711 (1979), where the Wisconsin Supreme Court considered an equal protection challenge to a statutorily imposed limitation on tort recoveries from municipalities. We quote with approval that court’s conclusion:

“We are unwilling to say that the legislature has no rational basis to fear that full monetary responsibility entails the risk of insolvency or intolerable tax burdens. Funds must be available in the public treasury to pay for essential governmental services; taxes must be kept at reasonable levels; it is for the legislature to choose how limited public funds will be spent. It is within the legitimate power of the legislature to take steps to preserve sufficient public funds to ensure that the government will be able to continue to provide those services which it believes benefits the citizenry. We conclude that the legislature’s specification of a dollar limitation on damages recoverable allows for fiscal planning and avoids the risk of devastatingly high judgments while permitting victims of public tortfeasors to recover their losses up to that limit.”

Id. 90 Wis.2d at 842, 280 N.W.2d at 719.

Article One, § 13, of the Alabama Constitution of 1901 provides:

“That all courts shall be open; and that every person, for any injury done him, in his lands, goods, person, or reputation, shall have a remedy by due process of law; and right and justice- shall be administered without sale, denial, or delay.”

The extent of the protection afforded by Section 13 has yet to be totally defined. Comment, Section IS: Constitutional Armor for the Common Law, 35 Ala.L.Rev. 127 (1984). Under the current analysis, the “common-law rights” approach, a two-tiered standard has been developed. Lankford v. Sullivan, Long & Hagerty, 416 So.2d 996 (Ala.1982). The standard to be applied depends upon the source of the right being affected. In this case the right to sue a municipality is a right created by statute. An attempt to alter or modify that right will run afoul of Section 13 only if the legislation is arbitrary or capricious. Id. at 1000. As our discussion of the equal protection challenge illustrates, the legislation is neither arbitrary nor capricious.

Aggregate Limitation

Next, the flood victims contend that § 11-93-2 does not contain an aggregate limitation on the recovery of property damages when multiple judgments are returned as the result of a single occurrence. A close examination of § 11-93-2 compels us to agree. The first sentence of. § 11-93-2 sets the recovery limit for bodily injury or death for one person in any judgment arising from a single occurrence. The second sentence sets the recovery limit for bodily injury or death for more than two persons under any judgment or judgments arising out of a single occurrence. The third sentence sets the recovery limit for property damage under any judgment arising out of a single occurrence.

The first and third sentences are identical except for the fact that the first applies to bodily injury or death and the third applies to property damage. Conspicuous by its absence is a forth sentence similar to the second sentence which would limit recoveries for property damage under any judgment or judgments arising out of a single occurrence.

If the Legislature had intended to create an aggregate limitation on recovery of property damages it could easily have done so. “The maxim of expressio unius est exclusio alterius, when coupled with the ease of inclusion if such had been intended,” requires that we find no aggregate limitation exists. Adams v. Mathis, 350 So.2d 381, 386 (Ala.1977).

We reject the City’s and Home’s argument that to give effect to the legislative intent as expressed in the preamble — “[t]o prescribe and establish monetary limits ... on tort liability” — we should read “any judgment” in the third sentence of § 11-93-2 to mean “all judgments.” We note first that even without an aggregate limitation on property damages, the act does provide monetary limits on tort liability for property damage under any judgment. They argue that without a cap on the total liability for property damage under multiple judgments the intent of the legislature is unfulfilled. Such an argument is unsound. The preamble to Act 673 does not purport to establish the maximum liability of local governmental entities under all circumstances.

The cases cited by the City and Home, Centennial Associates v. Clark, 384 So.2d 616 (Ala.1980), and Fuller v. Associates Commercial Corp., 389 So.2d 506 (Ala.1980), in support of their argument that “any” should be interpreted as “all” do not support their argument in this case. In Fuller we said, “[Wjhere statutory language is plain and unambiguous the statute should be given the meaning therein plainly expressed.” Id. at 508. See also, State v. Dawson, 264 Ala. 647, 89 So.2d 103 (1956) (when the language is plain and unambiguous and the meaning obvious, there is no room for construction). We find no ambiguity which requires us to construe the statute.

Standing

The flood victims allege that Home does not have standing to appeal the issue of the interpretation of the term “occurrence” as used in § 11-93-2 and applied to the facts of this case. Generally an appeal can be brought only by a party or his personal representative, City of Mobile v. Gulf Development Co., 277 Ala. 431, 171 So.2d 247 (1965), from an adverse ruling, McCulloch v. Roberts, 290 Ala. 303, 276 So.2d 425 (1973), contained in a final judgment Kelley v. U.S.A. Oil Corp., 363 So.2d 758 (Ala.1978).

The major contention raised is that while Home was a party to the entire declaratory judgment action, it was not technically a party to the counts of the City’s complaint which sought a determination of the “occurrence” issue. It should be kept in mind, however, that the main thrust of the City’s complaint was a determination of the insurance coverage provided by Home to the City. The City maintained that it had negotiated with Home for insurance that was co-extensive with the liability ceilings provided for in § 11-93-2. One of the critical issues in that dispute centered on the meaning of the word “occurrence” as used in § 11-93-2 and in the insurance contract.

Home certainly had a right to argue what it thought an “occurrence” was in § 11-93-2 when it wrote a policy intended to cover the City for its liability under the statute. Therefore, under the facts of this case, we find that Home was a party entitled to appeal the adverse ruling on the “occurrence” issue.

Occurrence

Having concluded that Home has standing, we address its contention that the trial court erroneously construed the term “occurrence” as used in § 11-93-2 and as applied to the facts of this case.

We recently had occasion to define the phrase “one occurrence.” United States Fire Insurance Co. v. Safeco Insurance Co., 444 So.2d 844 (Ala.1983). We concluded that “as long as the injuries stem from one proximate cause there is a single occurrence.” Id. at 846 (quoting Appalachian Ins. Co. v. Liberty Mut. Ins. Co., 676 F.2d 56, 61 (3rd Cir.1982)). While in Safeco we were attempting to give effect to the intention of the parties to the insurance contract and here we are trying to give effect to the intention of the Legislature, we find that difference to be of no consequence, since in both situations the drafting parties were attempting to accomplish the same objective. They sought to limit liability by limiting recoveries for injuries that result from a common source.

The act clearly is concerned with limiting tort liability, see § 11-93-3; therefore, it seems reasonable to use the tort law concept of proximate cause to establish what was the “occurrence” or alleged breach of duty that gave rise to the injuries. The “but for” test advanced by Home is at most a rule of exclusion and can provide no clue of any kind to singling out the source of injury from a legal standpoint. Cf. W. Prosser, Law of Torts, p. 238 § 41 (1971). We also reject the use of an “effect” or “impact” test advocated by some property owners. That test would say that every time someone or something is injured, there is an “occurrence.” It fails to focus on the source and instead looks at who or what was injured or damaged.

To reiterate, we hold that for the purposes of § 11-93-2, all injuries that stem from one proximate cause are the result of a single “occurrence.” The trial court held, in effect, that each flood victim was injured as the result of a separate occurrence, without specifying what theory or ground it used to reach that conclusion. In order to reach that conclusion using the “proximate cause” test that we now hold applies, the trial court would have had to find that the damage was the result of a negligent act of the City. Only a fraction of the flood victims testified at the trial of the “occurrence” issue, and their testimony focused mainly on whether the rainfalls or the allegedly negligent acts of the City were the occurrence. The testimony did not center on which negligent acts resulted in which injuries.

Our holding that the proximate cause test should determine what was a single occurrence compels us to find that this declaratory judgment action was not the proper forum to make the factual determination of what the occurrences were in this case. The flood victims named parties to this action had either lawsuits or claims pending against the City before this action was commenced. The resolution of the pending claims and lawsuits against the City by the individual flood victims will necessarily require a determination of whether the injuries suffered by the flood victims were proximately caused by the allegedly negligent acts of the City. The trial court should have declined to make the factual determination as to what the proximate cause of the flood victims’ injuries was, since it lacked jurisdiction because the same issue involving the same parties was pending in other proceedings at the time the declaratory judgment action was filed. Trimble v. City of Prichard, 438 So.2d 745 (Ala.1983); Smith v. North River Ins. Co., 360 So.2d 313 (Ala.1978). To the extent it made that factual determination, the judgment is void. Trimble, 438 So.2d at 746.

In conclusion, we affirm the trial court’s holding that § 11-93-2 is constitutional and applicable to this case; we reverse the determination that § 11-93-2 contains an aggregate limitation on the recovery of damages for injury to property; we hold that in determining what an “occurrence” is for the purposes of § 11-93-2, all injuries that stem from a single proximate cause are the result of a single “occurrence”; and we hold that the trial court should have declined to make the factual determination of what constituted the occurrence or occurrences in this case.

AFFIRMED IN PART; REVERSED IN PART; AND REMANDED.

MADDOX, FAULKNER, ALMON, SHORES, EMBRY, BEATTY and ADAMS, JJ., concur.

JONES, J., concurs specially.

JONES, Justice

(concurring specially).

I concur with the opinion in every aspect except for the standard of review applicable to a constitutional challenge of a statute as that standard is quoted from Alabama State Federation of Labor v. McAdory, 246 Ala. 1, 18 So.2d 810 (1944). A standard that casts upon the challenger the burden of overcoming a presumption of a statute’s constitutional validity, and imposes upon a reviewing court a duty to sustain the legislative act, unless it clearly violates fundamental law beyond a reasonable doubt, reverses the order of priority as between the organic law expressed in the constitution and the legislature’s exercise of its plenary powers. It is one thing for the challenger to have the burden of persuasion; it is yet another thing altogether to have the burden of overcoming a presumption of validity. The legislative act, once assailed, either comports with the guidelines of fundamental law and is valid, or it violates constitutional provisions and is void.

To be sure, the exercise of judicial power, in its review of legislative enactments, is not without admonitions of restraint. This delicate power must be used with a sensitive recognition that the legislature’s plenary power is absolute; that it is derived from neither federal nor state Constitutions; and that such power, apart from constitutional limitations, has no bounds. Courts must exercise great caution not to decide the constitutional issue in favor of invalidity because they think the challenged act is unwise or bad policy, or that it violates the court’s notions of citizens’ natural, social, or political rights not guaranteed by the Constitution. Appellate courts will address only those constitutional issues raised below and then only when necessary for an appropriate decision. If the act is equally susceptible to two interpretations, the one that comports with constitutional validity is favored over the one that does not. Likewise, if any portion of the act is constitutional, and that portion, when standing alone, can be given a reasonable field of operation, only the invalid portion will be stricken.

Most, if not all, of these admonitions of restraint are aptly set out in McAdory, but none of these rises to the level of a presumption of validity of a challenged act. What, then, is the origin of such a statement? I think the answer is quite simple. Without attempting a detailed review of the evolution of this principle through our case law development, it is interesting to note that this presumption of validity rule finds its expression in the earlier cases only in the context of unchallenged acts, or where the challenge was asserted by one not directly affected by the act’s operation. A typical statement of the rule, as originally espoused, is found in Jones v. Black, 48 Ala. 540 (1872):

“Nor will a court listen to an objection made to the constitutionality of an act of the Legislature by a party whose rights it does not specially affect. An act of the Legislature will be assumed to be valid until some one complains whose rights it invades, and it is only when some person attempts to resist its operation, and calls in the aid of the judicial power to pronounce it void as to him, his property, or his rights, that the objection of unconstitutionality can be presented and sustained.” Cited with approval in Shehane v. Bailey, 110 Ala. 308, 20 So. 859 (1895), and State v. Montgomery, 177 Ala. 212 at 221, 59 So. 294 at 296 (1912), which was cited with approval by Justice Beatty, speaking for the Court, in Lowe v. Fulford, 442 So.2d 29 (Ala.1983).

Somewhere between Montgomery and McAdory, our Court dropped a qualifying phrase from a very solid rule: Until assailed by a party whose rights are specially affected, a legislative act is presumed valid. Thus, by so altering the expression of the rule, a fundamental concept was perverted.

      . Code 1975, § 11-93-1(5), provides:
      " ‘Claim’ means any claim against a governmental entity, for money damages only, which any person is legally entitled to recover as damages caused by bodily injury or property damage caused by a negligent or wrongful act or omission committed by any employee of the governmental entity while acting within the scope of his employment, under circumstances where the governmental entity, if a private person, would be liable to the claimant for such damages under the laws of the State of Alabama.”

      . While I have not concurred in, and continue to disagree with, this analysis in considering Section 13 challenges, Fireman’s Fund American Insurance Co. v. Coleman, 394 So.2d 334 (Ala.1980) (Beatty, J., dissenting), I see no reason to argue the point in this case. The statute survives scrutiny under either the "common-law rights" approach or the "vested rights” approach as originally articulated in Pickett v. Matthews, 238 Ala. 542, 192 So. 261 (1939), which I would employ.

      . Code 1975, § 11-93-2, provides:
      "The recovery of damages under any judgment against a governmental entity shall be limited to $ 100,000.00 for bodily injury or death for one person in any single occurrence. Recovery of damages under any judgment or judgments against a governmental entity shall be limited to $300,000.00 in the aggregate where more than two persons have claims or judgments on account of bodily injury or death arising out of any single occurrence. Recovery of damages under any judgment against a governmental entity shall be limited to $100,000.00 for damage or loss of property arising out of any single occurrence. No governmental entity shall settle or compromise any claim for bodily injury, death or property damage in excess of the amounts hereinabove set forth."


source: Caselaw Access Project

author: PER CURIAM. ADAMS, Justice

license: Public Domain

text:
    Vera Long GIBSON, Administratrix of the Estate of Bob Carl Long v. Patricia E. HENDERSON.
    82-1186.
    Supreme Court of Alabama.
    Sept. 21, 1984.
    Rehearing Denied Nov. 9, 1984.
    Michael S. Ballard, Birmingham, for appellant.
    Thomas H. Brown and Kaye K. Houser of Sirote, Permutt, Friend, Friedman, Held & Apolinsky, Birmingham, for appellee.
   PER CURIAM.

This case arose from the following facts:

Bob Carl Long, the deceased insured in this case, was a retired employee of the Singer Company. While an employee, he took a $22,000 life insurance policy through that company under a group plan.with Metropolitan Life Insurance Company, designating his mother, Eva Louise Long, as the beneficiary.

Eva Louise Long died in March of 1980. Thereafter, on June 15, 1980, Bob Long executed a change of beneficiary form of the kind approved by Metropolitan for such purposes. The form designated Patricia E. Henderson as the beneficiary. Although Long filled in and signed the change of beneficiary form and also had it witnessed by his aunt, the plaintiff Vera Gibson, he neither mailed nor otherwise delivered the form to his employer or the insurance company.

Bob Long died on September 5, 1981, fifteen months after executing the change of beneficiary form. The following day, Patricia Henderson, her nephew Jerry Cornelius, and two cousins of the deceased, James D. Long and Jane Frierson, went through his personal effects, looking for a will. A carbon copy of the change of beneficiary form was found in a drawer in Long’s desk at his home. Later, the original was also found in the desk. James Long delivered the form to the plaintiff Vera Gibson. Patricia Henderson subsequently requested and received the form from Gibson and thereafter mailed it to the Singer Company.

Metropolitan delayed payment of the proceeds of the insurance policy because of its inability to determine the proper beneficiary under the contract. Patricia Henderson claimed she was entitled to the proceeds as she was the named beneficiary. Vera Gibson claimed the proceeds under the following language in the policy:

“If any designated Beneficiary shall die before the Employee, the rights and interest of such Beneficiary shall thereupon automatically terminate. If at the death of the Employee, there be no designated Beneficiary as to all or any part of the insurance, then the amount of insurance payable for which there is no designated Beneficiary shall be payable to the estate of the Employee....”

Gibson claimed that because the original beneficiary under the policy had died and the change of beneficiary form had not been delivered to the Singer Company either by Bob Long or by someone else acting under his direction, there was no named beneficiary, and Long’s estate was the proper recipient of the policy proceeds.

Vera Gibson filed suit on August 16, 1982, naming Henderson and Metropolitan as defendants, and seeking a declaration that Bob Long’s estate was entitled to the insurance proceeds. Henderson filed her answer, with a counterclaim and a cross-claim, on September 15, 1982, asserting that the change of beneficiary form was valid even though it was mailed to the Singer Company after Bob Long’s death. Metropolitan filed its answer, with a counterclaim and cross-claim for interpleader, on October 29, 1982, seeking to interplead the insurance proceeds into the court. Metropolitan tendered to the court the sum of $28,754.42, which represented the value of the policy plus interest to that date.

Henderson and Gibson each moved for summary judgment, and Metropolitan moved for its discharge from the case. On August 5, 1983, final judgment was entered in the case. The court found that there was no genuine issue of material fact and that Patricia Henderson was entitled to judgment as a matter of law. The court denied plaintiff Gibson’s motion for summary judgment and granted Metropolitan the right to interplead and be discharged. Gibson appealed. We reverse and remand.

Gibson asserts on appeal that the lower court erred in granting Henderson’s motion for summary judgment because, based on the undisputed facts in the record, Bob Long had not substantially complied with the policy requirements for changing beneficiaries. This failure to substantially comply, Gibson says, rendered the attempted change of beneficiary ineffective so that Long died with no named beneficiary of his life insurance. Gibson asserts that the policy proceeds rightfully belong to Long’s estate and that the grant of summary judgment for Henderson was error.

The issue on this appeal from the summary judgment is whether the evidence adduced in support of Henderson’s motion for summary judgment showed conclusively that Bob Long had effected a change of beneficiary of his life insurance policy in favor of Patricia Henderson.

Generally, the designation of the beneficiary of a life insurance policy is governed by the provisions of the policy itself. Williams v. Williams, 438 So.2d 735 (Ala.1983). The policy in this case provides for changes of beneficiary as follows:

“The Employee may change his Beneficiary at any time by filing written notice thereof on such form with the Employer. Consent of the Beneficiary shall not be requisite to any change of beneficiary. ... After receipt of such written notice by the Employer, the change shall relate back and take effect as of the date the Employee signed said written notice of change, whether or not the Employee is living at the time of such receipt....”

Appellee Henderson argues that when Bob Long filled out the change of beneficiary form, signed it, and had Vera Gibson sign as a witness, he initiated the process of strict policy compliance and that that process became complete when the Singer Company ultimately received the form. Henderson states that even though Long neither mailed nor delivered the form to his former employer, the change was nevertheless effective because the policy provides that when the form is received by the employer, the change will relate back and take effect as of the date of the form’s execution, whether or not the insured is still alive at that time. In other words, even though Patricia Henderson mailed the form to the Singer Company after Long’s death and fifteen months after the form was executed, she says the change of beneficiary is valid.

Appellant Gibson asserts that under the policy language, the employee himself must give notice of a change of beneficiary by mailing or otherwise delivering the form to his employer, and that the relation back provision applies when the insured puts the form in the mail or otherwise sets in motion the form’s delivery to the employer, and subsequently dies before the employer receives the form. She agrees that under the policy language the change was to be effective as of the date the form was executed and not the date of receipt of the form by the employer, but says this was true only when the insured himself had initiated the transit of the form.

There are no Alabama cases exactly on point. However, the treatises are instructive, as are cases from other jurisdictions. In 5 Couch on Insurance 2d, we find the following:

“In most cases in which the conflict is not between the insurer and the claimant but between the original beneficiary and the substituted beneficiary, the application of equitable principles is of paramount importance. The applicable rule is usually stated in the form that on the principle that equity regards as done that which ought to be done the Courts will give effect to the intention of the insured by holding that a change of beneficiary has been accomplished where he has done all that he could to comply with the provisions of the policy.”

5 Couch on Insurance 2d § 28:65 (1960).

“The rationale relied on by many of the cases permitting substantial compliance to effect a change of beneficiary, namely, that equity regards as done that which ought to have been done, is avoided by the courts rejecting the substantial compliance doctrine on the basis that the equitable maxim applies only where the party seeking to invoke it has established a clear obligation based upon a valuable consideration that another should do some act which he has failed to perform and does not apply where a change of beneficiary has not been completed according to the provisions of the policy and the beneficiaries contemplated under the incompleted change fall within the class denominated in equity as volunteers.
“In rejecting this doctrine of substantial compliance it is sometimes said that if the insured has not sufficiently complied with the requirements for a change of beneficiary prior to this death, his death serves to vest in the named beneficiary the right to the proceeds of the policy and no act of the insurer or other claimant can prejudice the right, even though the insurer or society could, during deceased’s lifetime, have waived compliance with the requirements.”
5 Couch on Insurance 2d § 28:68 (1960).
“When the insured has done some acts with the object of changing the beneficiary but these acts fall short of mailing or sending a formal application for change to the insurer, it is generally held that no change of beneficiary is effected, the theory being that in the absence of any excusing circumstances, the insured has not done everything in his power to effect a change.”
5 Couch on Insurance 2d § 28:76 (1960).

Another prominent treatise, 2 Appleman Insurance Law & Practice, on the issue of compliance regarding changing the beneficiary, states:

“The general rule is to the effect that the insured must comply substantially with such provisions in order to effect a valid change....
“The result is that the courts state that the methods adopted by the insurer prescribing the manner in which the change shall be made must be followed unless the insured had done everything in his power, in which case such acts will be endorsed by the courts. The courts have felt that the insured having done everything in his power to give effect to such change, they will regard it as a completed act and give effect thereto." (Emphasis added.)

2 Appleman, Insurance Law & Practice § 943 (1966).

We cannot hold that the facts presented on Henderson’s motion for summary judgment negate any genuine issue of fact as to whether the insured “ha[d] done all that he could to comply with the provisions of the policy,” 5 Couch on Insurance 2d § 28:65, supra, or “ha[d] taken the steps required of him to effect a change of beneficiary.” American Life Ins. Co. v. Carlton, 236 Ala. 609, 184 So. 171 (1938). See Rule 56(e), A.R.Civ.P. Here the policy provides that the insured may change his beneficiary at any time “by filing written notice thereof on such form with the Employer.” (Emphasis added.)

In this case, the insured was familiar with the insurance industry, having been employed as manager of the insurance and stock department of the Life Insurance Company of Alabama from 1961 to 1968, and as the Birmingham agency manager of the Piedmont Southern Insurance Company from 1968 to 1971. The evidence does not establish why he left the change of beneficiary form in his desk drawer for fifteen months after it was signed. The appellee’s statement that he forgot to mail it is an unsupported conclusion on her part. It is equally logical to conclude that he decided not to change his beneficiary. Put simply, the facts presented on the motion for summary judgment do not show conclusively that Long had done all in his power, or taken every reasonable step, to comply with the policy provision. Since the facts shown by Henderson, even if undisputed, would not have entitled her to a judgment as a matter of law, the summary judgment in her favor was improper. Rule 56(c), A.R.Civ.P.

Cases from other jurisdictions support this conclusion: Magruder v. Northwestern Mutual Life Ins. Co., 512 F.2d 507, 509 (6th Cir.1975), quoting Republican Nat’l Life Ins. Co. v. Sackmann, 324 F.2d 756, 758 (6th Cir.1963), states that

“the beneficiary in an insurance policy may be effectively changed if insured substantially complies with the provisions of the policy for such a change of beneficiary. The test of substantial compliance is whether insured has done everything that he could do to make the change.”

Manhattan Life Ins. Co. v. Barnes, 462 F.2d 629, 633 (9th Cir.1972), states that the insured must make “every reasonable effort to change the beneficiary.”

Witt v. Citizens Nat’l Bank, Waco, 440 S.W.2d 112, 114 (Tex.Civ.App.1969), states: “Substantial compliance with the method of changing beneficiary provided in the policy means insured ‘has done all that he could reasonably have done’ to effect the change.”

United Services Life Ins. Co. v. Moss, 303 F.Supp. 72, 75 (1969), says:

“As to the law, there has been no Virginia case in point but the court believes Virginia would follow the great weight of authority in holding that: ‘* * * it must appear (1) that the insured had determined to change the beneficiary and (2) that he had done everything to the best of his ability to effect the change.’ ”

The burden was on the appellee to show “excusing circumstances,” 5 Couch on Insurance 2d § 28:76 (1960), for not sending the application for change to the insurer, and on her motion for summary judgment she did not meet this burden. Finally, we think the rule stated in John Hancock Mutual Life Ins. Co. v. Dutton, 585 F.2d 1289, 1296 (5th Cir.1978), is the better view:

“Both policies clearly require more than a completion and signature of the forms to effect a change of beneficiary; the policies require that the insured actually file the forms before the change is effective. Here the forms were not filed by the insured nor by anyone acting under his direction; rather, they were filed by someone who discovered them in Mr. Sheley’s desk drawer after his death. Thus, the requirements of the policy for a change of beneficiary were not met.”

The judgment of the trial court is reversed and the cause remanded for proceedings consistent with this opinion.

REVERSED AND REMANDED.

MADDOX, FAULKNER, ALMON, SHORES and BEATTY, JJ., concur.

TORBERT, C.J., and JONES, EMBRY and ADAMS, JJ., dissent.

ADAMS, Justice

(dissenting).

I dissent.

The provisions in an insurance policy which prescribe the requirements for changing the beneficiary of the policy are for the sole benefit and protection of the insurance company. If the insurer does not take advantage of the requirements for such a change, neither can anyone else. Whitman v. Whitman, 225 Ala. 113, 142 So. 413 (1932). Therefore, when the insurer interpleads the proceeds of a life insurance policy and chooses not to take sides between claimants, the insurer waives strict compliance with policy requirements by the insured. McDonald v. McDonald, 212 Ala. 137, 102 So. 38 (1924).

In Whitman v. Whitman, supra, this Court stated the following:

“[T]he method of changing the beneficiary as per the terms and method prescribed by the policy is not the exclusive method of doing so as between the insured and the beneficiaries, and a failure to do so in strict compliance with the policy may be waived by the company. It follows that it was not essential to a valid change of the beneficiary, in the case at bar, to set out that the beneficiary was changed as per the terms of the policy....”

225 Ala. at 114, 142 So. at 413-14. The Court affirmed the overruling of a demurrer after concluding that an answer and cross-bill asserting a change of beneficiary did not have to set out the policy provisions required for the change and did not have to aver that those requirements were met.

In Phillips v. Phillips, 240 Ala. 148, 198 So. 132 (1940), the Court affirmed the trial court’s finding.in a case tried ore tenus that no change of beneficiary had been made, but nevertheless recognized that a change could transpire by a gift of the policy without compliance with the policy requirements:

The policy contained the usual provisions requiring change of beneficiary to be in writing executed by the insured and presented to the insurer.
This provision, as we have often held, is for the protection of the insurer, may be waived, and is waived, when the insurer, as in this case, raises no question in this regard, takes the position of a stakeholder, leaving the claimants to litigate their claims as between themselves.

240 Ala. at 150, 198 So. at 133. (Citations omitted.)

In this case, Metropolitan Life Insurance Company interpleaded the proceeds of the policy in dispute, thereby waiving any requirement that Bob Long strictly comply with the insurance policy prerequisites for changing the beneficiary. Since Metropolitan did not demand strict compliance, neither can appellant Gibson. Therefore, although it may be relevant, a determination of whether Bob Long complied with his policy requirements for changing his beneficiary is not crucial to the outcome of this case.

As recognized in the majority opinion, in a case such as this one “the application of equitable principles is of paramount importance.” 5 Couch on Insurance 2d § 28:65 (1960). The courts are to do equity in these cases and are not bound by the terms in the insurance policy. In McDonald v. McDonald, supra, the Court said this:
We can see no sufficient reason why the court should not render its judgment according to equity; that is, by assuming that to have been done which on the facts before us ought to have been done during the lifetime of the insured, or by giving effect to those more general principles of equity which obtain in both courts alike.

212 Ala. at 143, 102 So. at 43. (Emphasis added.) In that case, the insured notified the insurer of the desired change of beneficiary, but the substitution was not actually accomplished as required by the policy terms, which required a notation on the policy itself. The Court concluded that

... the policy was not the contract, it was merely evidence of the contract between the parties, which, by mutual consent, might afterwards be changed without changing the paper, and as to which the parties were bound by the implications of their acts. The insured made an effort to have his contract changed in favor of appellants, which the company, for its part, now says may be accepted by the court as made in perfect compliance with the requirements of the policy.

212 Ala. at 141-142, 102 So. at 41.

In Norton v. Norton, 280 Ala. 307, 193 So.2d 750 (1967), the Court affirmed the trial court’s finding that the insured had effected a change of beneficiary by parol. There was no evidence of the alleged change of beneficiary other than testimony by several witnesses to declarations by the insured that his second wife was the substituted beneficiary of his policy. This is in accord with Whitman v. Whitman, supra, in which this court stated that a change of beneficiary “could be effected by parol or written instrument manifesting insured’s intent to change the beneficiary.” Whitman, 225 Ala. at 114, 142 So. at 413.

In the present case, the evidence indicates that Bob Long made an effort to have his beneficiary changed. Metropolitan accepted that method of change by interpleading the policy proceeds. The trial court applied equitable principles to the facts of the case and held that a valid change of beneficiary had in fact occurred. Although this case was decided on a motion for summary judgment, the parties stipulated to the facts and there was no indication that any other evidence would be presented if a hearing was held. The determination in this respect was a judgment on the merits. I would affirm the trial court’s conclusion that a change of beneficiary was accomplished.

TORBERT, C.J., and JONES and EM-BRY, JJ., concur.


author: JONES, Justice. EMBRY, Justice

text:
    AMERICAN CYANAMID COMPANY v. UNITED STATES FIDELITY & GUARANTY CO., et al.
    83-336, 83-380.
    Supreme Court of Alabama.
    Sept. 21, 1984.
    Rehearing Denied Nov. 9, 1984.
    William J. Sullivan, Jr. of Sadler, Sullivan, Sharp & Stutts, Birmingham, for appellant.
    Steven F. Casey of Balch, Bingham, Baker, Ward, Smith, Bowman & Thagard, Birmingham, for appellee Alabama Power Co.

      W.J. McDaniel and Connie Ray Stock-ham, Birmingham, for appellees John A. Teague and Teague Ins. Agency.
    L. Graves Stiff III, of Starnes & Atchi-son, Birmingham, for appellee U.S. Fidelity and Guar. Co.
   JONES, Justice.

These appeals, following A.R.Civ.P. 54(b) orders, by Plaintiff/Appellant American Cyanamid Company (ACCO), stem from the trial court’s grant of summary judgment motions in favor of Defendants/Appellees USF & G, Alabama Power Company, (APCo) John A. Teague, and Teague Insurance Company. We affirm as to John A. Teague, individually, and reverse and remand as to each of the corporate Defendants.

FACTS

ACCO’s plant is adjacent to the Kimberly-Clark (K-C) plant near Childersburg, Alabama. ACCO manufactures a product used by K-C in the manufacture of paper. ACCO engaged William C. Sayers, d/b/a Coosa Machine Shop, to clean out the residue or waste product from the ACCO plant, which was pumped through flexible pipes into two ponding areas.

Ronnie Gramling, an employee of Sayers, while operating the dragline during the cleaning procedure, allowed it to come into contact with Alabama Power Company’s power lines that extended over ACCO’s property and supplied electricity to K-C’s plant. When the dragline hit the electric wires, the power was “knocked out” at the K-C plant for eight hours, shutting down its production, and causing the work in progress to solidify or freeze in the machinery. Damage to K-C amounted to $155,-556.00. No other property was damaged, and no one was injured.

An agreement between ACCO and K-C contains the following provision:

“9. Indemnification: Cyanamid agrees to protect, reimburse and hold harmless Kimberly-Clark for any loss or damage which Kimberly-Clark may incur as a result, in whole or in part, of the act .of Cyanamid, its employees or agents, under the terms of this agreement. Cyanamid shall, and hereby agrees to, indemnify and save Kimberly-Clark harmless from and against liability or liabilities which may be claimed or asserted against Kimberly-Clark by reason of any damage or injury to any person or persons whomsoever or to any property or properties whatsoever, caused by, arising out of, or in any way connected with the services and supply furnished and to be furnished by Kimberly-Clark hereunder, including the transmission thereof or relating to further provision of maintenance of any incidental line, poles, pipes, or any equipment and appliance provided, however, that Cyanamid’s said indemnification shall not extend to any liability that may be caused by or arise out of the negligence of Kimberly-Clark, its employees, agents, invitees or representatives.”

Additionally, ACCO required Sayers to insure himself and his company against the possibility of an accident causing personal injury and/or property damage. Insurance was procured with USF & G through the Teague Insurance Company, USF & G’s local agent. According to testimony by ACCO’s officers, ACCO had an oral agreement with Teague which provided that ACCO would be notified if Sayers’s insurance was cancelled. The insurance was cancelled several months before the accident, but ACCO was not notified.

Pursuant to their indemnification agreement, ACCO paid K-C $155,556.00, and then sued Alabama Power Company, Sayers, and Gramling as joint tortfeasors, claiming as damages the monies paid by it to K-C. Additionally, ACCO claims breach of contract and negligence against USF & G, John Teague, and Teague Insurance Company for failure to notify ACCO of the cancellation of Sayers’s insurance policy.

ISSUES

The broad issue involved in these appeals is whether a genuine issue of material fact existed as to any of the Defendants such that the trial judge erred in granting summary judgment in favor of each of the Defendants. Essential to the determination of that issue are the following specific issues:

As to APCo: 1) Whether ACCO’s claimed status as a subrogee to the rights of K-C is valid, thus permitting ACCO to maintain an action against APCo for its alleged negligent damage to K-C; and, if so, 2) whether, under the facts shown in support of APCo’s summary judgment motion, ACCO’s claim is precluded, as a matter of law, because of the dangerous or hazardous activity of its independent contractor’s operation of the dragline.

As to USF & G, Teague, and Teague Insurance Co.: Whether the alleged promise to notify ACCO of the cancellation of the insurance policy is unenforceable, as a matter of law, for lack of consideration.

DECISION:

As to APCo: 1) Subrogation

Although the trial court’s order does not state the grounds for its dismissal of APCo, APCo argues that ACCO was not liable to K-C under paragraph 9, the indemnification provision of the agreement between ACCO and K-C, thus preventing ACCO from pursuing APCo under a theory of subrogation. According to that agreement, ACCO is liable to K-C “for any loss or damage which [K-C] may incur as a result ... of the act of [ACCO], its employees or agents.” Admittedly, Sayers was an independent contractor, and Gramling was his employee. APCo contends that this distinction is dispositive of the subrogation issue, and thus dispositive of the issue of its liability to ACCO.

We disagree. While, according to the letter of the indemnification agreement, it is arguable that ACCO is to hold K-C harmless for loss or damage caused by ACCO’s employees or agents, the spirit of the agreement is not so limited. Rather, the intent of the agreement is not to limit loss or damage to that caused solely by ACCO’s agents or employees, but to include loss or damage incurred by K-C as a result of the act of ACCO in the performance of its contractual obligations to K-C.

Indeed, it is unreasonable to speculate that ACCO could have successfully defended a claim for indemnity by K-C for the loss here in question on the ground that Sayers was an independent contractor and not its employee. Particularly is this true where, as here, ACCO’s liability, pursuant to the terms of indemnity, is not predicated upon ACCO’s culpable conduct. For purposes of K-C’s enforcement of the indemnity agreement, “any loss or damage which [K-C] may incur as a result ... of the act of [ACCO]” is the same, in legal terms, whether the power outage was caused by ACCO’s employee, while cleaning out ACCO’s ponds, or by an independent contractor engaged by ACCO for that purpose. Whatever legal significance may attach to the employee/independent contractor distinction in other contexts, in the instant context it is a distinction without a difference.

Furthermore, beyond the narrow language of the indemnity agreement, ACCO rests its theory of subrogation on the principles enunciated in American Southern Insurance Co. v. Dime Taxi Service, Inc., 275 Ala. 51, 151 So.2d 783 (1963). Dime Taxi involved the liability of a taxi company for damages sustained by a passenger in an accident caused by the negligence of the taxi company’s driver. The taxi company was liable because of the negligence of its driver, and the Court allowed the employer to be subrogated to the rights of the injured party against the driver, its own employee, and the driver’s insurer. 275 Ala. at 56, 151 So.2d at 786.

While Dime Taxi’s theory of subro-gation is limited, of course, to the factual context of that case — a master/servant relation — we cannot so limit the rule’s application. The Dime Taxi principle of subro-gation is equally applicable here. When one, under a claim of right, discharges an obligation for which another should be held legally liable for payment, then the former stands in the shoes of the obligor and may seek reimbursement against the latter for the damages caused by its allegedly culpable conduct.

At any rate, K-C did, in fact, assert its claim (albeit informally) against ACCO, pursuant to the indemnity agreement; and ACCO, consistent with K-C’s interpretation of that agreement, paid the claim. Therefore, APCo is without standing to contest ACCO’s status as subrogee on the ground that ACCO was not obligated to pay K-C’s loss under the terms of the indemnity agreement. Because of ACCO’s payment to K-C under the indemnity agreement, we hold that ACCO is entitled to stand in the shoes of K-C against APCo. This is not to say, of course, that ACCO, by its payment, enhanced its position over that held by K-C in the pursuit of its claims against either of the alleged joint tortfeasors. In its claims against each of the Defendants, ACCO’s plaintiff status is no better or no worse than that of the. party in whose shoes it now stands.

2) APCo’s Liability

We are confident that the trial court grounded its summary judgment order on the subrogation issue and did not reach the issue of ACCO’s allegation of negligence or APCo’s primary defense of the dangerousness vel non of the crane operation. In any event, it is clear that a genuine issue of material fact is presented for determination by the jury; thus, disposition by summary judgment is inappropriate.

AS TO USF & G, TEAGUE, AND TEAGUE INSURANCE COMPANY

In support of its respective motions for summary judgment, the insurance group of Defendants submitted a brief stipulation of facts and argued that any oral agreement to notify ACCO, in the event of the cancellation of Sayers’s liability insurance policy, was invalid for lack of consideration, citing, as authority, United States Pipe and Foundry Co. v. United States Fidelity and Guar. Co., 505 F.2d 88 (5th Cir.1974). If United States Pipe is interpreted as saying, in all events where the insurance company agrees to notify one who is not the insured or the named loss payee and who did not pay the premium, that the requisite element of consideration is lacking, as a matter of law, then we reject that interpretation as an incorrect statement of Alabama law.

While we do not so construe United States Pipe’s holding, the appellee insurance group urged this interpretation below and on appeal; and, unquestionably, the trial court’s summary judgment order impliedly reflects this narrow construction. Be that as it may, under the totality of the circumstances in the instant case, we hold that a fact question is presented as to the presence or absence of the required element of consideration.

If the jury is reasonably satisfied from the evidence that the promise of Teague Insurance to notify ACCO of any cancellation of Sayers’s coverage was a mere gratuity or courtesy, unrelated to ACCO’s efforts in placing the coverage with the Teague agency, then the jury would not be authorized to find a binding agreement to notify. If, on the other hand, the jury is reasonably satisfied that ACCO’s president, or other corporate officer, accompanied Sayers to the Teague agency in furtherance of Sayers’s contractual obligation to acquire insurance and that ACCO was instrumental in placing this coverage with the Teague agency on the condition that ACCO’s interest be protected through notification by the Teague agency of any cancellation of the coverage, then the jury would be authorized to find the requisite element of consideration for the agreement; and for the failure to notify ACCO of the policy’s cancellation, the Teague agency and USF & G could be held liable.

We find no basis for liability against Teague individually; thus, we affirm the order of dismissal as to him. We reverse the judgment as to each corporate defendant and remand this cause for further proceedings not inconsistent with this opinion.

AFFIRMED IN PART; REVERSED IN PART; AND REMANDED.

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

MADDOX, ALMON, EMBRY and ADAMS, JJ., dissent.

EMBRY, Justice

(dissenting): •

There are several fallacies in the majority opinion. Examples are found in statements such as: “Rather the intent of the agreement is not to limit loss or damage to that caused solely by ACCO’s agents or employees, but to include loss or damage incurred by K-C as a result of the act of ACCO in the performance of its contractual obligations to K-C.”

Neither the indemnification agreement nor the evidence in this case permits me to reach such a conclusion.

Nor can I conclude that: “Whatever legal significance may attach to the employee/independent contractor distinction in other contexts, in the instant context it is a distinction without a difference.”

In this case, the Dime Taxi principle of subrogation is in nowise applicable. Furthermore, ACCO, rather than discharging an obligation under a claim of right, under the evidence, voluntarily paid the debt of another without any duty to do so. In these circumstances, ACCO is not subro-gated to any rights of Kimberly-Clark. Barnes v. Powell, 241 Ala. 409, 3 So.2d 80 (1941). Testimony of the person who made the decision that American Cyanamid would pay Kimberly-Clark was that he did not understand the difference between an agent or servant and an independent contractor in a legal sense.

The operation of the crane in this case was not an inherently dangerous activity under the law. Evans v. Kendred, 362 So.2d 206 (Ala.1978). Factually, the evidence will not support the conclusion that it was, in this case, anything other than.

“Ordinary building operations or activities, including both construction and demolition, [which] are generally not considered work of an inherently or intrinsically dangerous character rendering the employer-owner liable for injuries resulting from the negligence of an independent contractor in doing the work_” (Emphasis added.)

41 Am.Jur.2d Independent Contractors § 43 (1968). For many reasons, including those stated herein, the judgments below are due to be affirmed.

MADDOX, ALMON and ADAMS, JJ., concur.


author: TORBERT, Chief Justice.

text:
    Clint YOUNGBLOOD v. Betty BAILEY, etc. Betty PARKER and Michelle Parker, d/b/a Everett’s Florist v. Louise H. DAVIS. Clint YOUNGBLOOD v. NORTHPORT CHAMBER OF COMMERCE.
    82-1122, 82-1203 and 83-151.
    Supreme Court of Alabama.
    Sept. 28, 1984.
    Rehearing Denied in 82-1203 Nov. 9, 1984.

      James D. Turner for Turner, Turner & Turner, Tuscaloosa, for appellant Clint Youngblood.
    Olin W. Zeanah and William J. Donald III of Zeanah, Donald & Hust, Tuscaloosa, for appellees/cross-appellants Betty Bailey, etc. & Betty Bailey and Michelle Parker, etc.
    Robert F. Prince, of Prince & McGuire, Tuscaloosa, for appellee Louise H. Davis.
   TORBERT, Chief Justice.

These appeals arise from the sale of a ticket to a Northport Chamber 'of Commerce (Chamber) social function. The tickets of admission sold by the Chamber to its social function also entitled their holders to a chance to win a 1983 Lincoln Continental automobile. Ms. Betty Bailey and her business partner, Michelle Parker, bought one of these tickets in order to attend the Chamber’s function and get a chance of winning the car. Under the rules established by the Chamber concerning the drawing for the car, the ticket holder could sell his ticket to the highest bidder present before the drawing occurred, with the Chamber receiving 20% of that purchase price. Prior to the drawing, Ms. Bailey decided to sell her ticket to Clint Young-blood for $1,000 ($800 was to be paid to her and $200 was to be paid to the Chamber). This ticket was drawn as the winning ticket.

On the Monday following the drawing, Ms. Bailey and the Chamber discovered that the checks written by Youngblood as payment for the winning ticket were drawn on an account with insufficient funds to honor the checks. When Youngblood tried to give a cashier’s check to Ms. Bailey later in the week for the amount of the dishonored cheek, Ms. Bailey refused to accept it and demanded that the winning ticket be given back to her so that she could claim the car. Youngblood refused to return the ticket and informed Ms. Bailey that he had sold his interest in the car to a Ms. Louise Davis and that Ms. Davis would receive title to the car.

Ms. Bailey and Ms. Parker (sometimes hereinafter “plaintiffs”) filed an action against Mr. Youngblood (sometimes hereinafter “defendant”), claiming that he had defrauded them by falsely representing that his account could cover the check written for their ticket and seeking an order from the trial court rescinding the sale of the ticket and declaring them to be the rightful owners of the car. They then amended their complaint to add Ms. Davis as a defendant, claiming that she knew that Mr. Youngblood did not have good title to the car and that she was part of a scheme to defraud the plaintiffs. The Chamber then filed an interpleader action, naming Bailey and Youngblood as defendants. The Chamber paid into court the $200 it received from Mr. Youngblood as payment for its part of the ticket and sought a determination by the court as to who was the actual owner of the car.

In its judgment, the trial court found that Youngblood had intentionally defrauded the plaintiffs. The court made the following orders:

“[12] That a judgment is hereby entered in favor of the plaintiffs, Betty Bailey and Michelle Parker, d/b/a Everett’s Florist, against the defendant, Clint Youngblood, for compensatory damages in the amount of $800.00.
“[13] That a judgment is hereby entered in favor of the plaintiffs, Betty Bailey and Michelle Parker, d/b/a Everett’s Florist, against the defendant, Clint Youngblood, for punitive damages in the amount of $10,000.00.
“[14] That the defendant, Louise H. Davis, is hereby ordered not to make any demand for or otherwise attempt to obtain possession of the prize automobile, until the expiration of 30 days from the date of this Final Judgment.
“[15] That Plaintiff, Louise H. Davis, ... is a good faith purchaser for value as that term is defined in § 7-2-403, Code of Alabama, 1975. Accordingly, Plaintiff Davis is hereby awarded the title to the 1983 Lincoln Continental Town Car, the subject of Plaintiff Davis’ Petition for injunction and other relief....
“[16] IT IS FURTHER ORDERED, ADJUDGED AND DECREED that the Defendant, Clint Youngblood, shall pay an attorney’s fee of One Thousand Five Hundred Dollars ($1,500) to Henley, Whi-tehurst & Shirley, P.C., the attorneys for Plaintiff, Northport Chamber of Commerce ....
“[17] IT IS FURTHER ORDERED, ADJUDGED AND DECREED that the sum of Two Hundred Dollars ($200) heretofore paid into Court by the Plaintiff, Northport Chamber of Commerce, be refunded by the Clerk of the Court to the said Plaintiff.”

The initial question that must be decided by this Court is whether the activity conducted by the Northport Chamber of Commerce was an illegal lottery under the laws of Alabama. The Chamber offered tickets to members of its organization to attend a social function. Along with admission, the ticket also purchased a chance to win a 1983 Lincoln Continental. The Chamber charged $150 per ticket, and plaintiffs Bailey and Parker paid this amount in order to receive their ticket. Under the rules established by the Chamber, numbers corresponding to the tickets were randomly drawn out of a basket until a final ticket was chosen as a winner.

Under Article IY, Section 65, of the Alabama Constitution of 1901, the State Legislature is specifically prohibited from authorizing any type of lottery and is affirmatively required to pass laws prohibiting lotteries. This Court has stated that in order to constitute a lottery violative of this provision, three elements must be present: (1) A prize, (2) awarded by chance, (3)for a consideration. Opinion of the Justices, 397 So.2d 546, 547 (Ala. 1981). This Court has also stated that the constitutional provision prohibiting lotteries also applies to those lotteries conducted by legitimate businesses and to those lotteries where the purchase price for the ticket entitles the holder to more than just the chance to win the prize. Grimes v. State, 235 Ala. 192, 193, 178 So. 73, 74 (1937). In this case, all three of the elements are present: The 1983 Lincoln Continental is the prize; the tickets were randomly drawn so that chance, not skill, determined the winner; and, each ticket holder, including the plaintiffs, was required to pay the Chamber $150 for the ticket. With all three elements present, this activity is a lottery and directly violates the public policy of this State. Try-Me Bottling Co. v. State, 235 Ala. 207, 212, 178 So. 231, 234 (1938).

After answering this threshold question, we must next address the question of the enforceability of a contract based on such an illegal activity. As a general proposition, a court will not aid either party to an illegal contract, in enforcing or rescinding that contract, but will instead leave the parties where it found them, if both are equally at fault. May v. Draper, 220 Ala. 214, 215, 124 So. 89, 91 (1929). There are two contracts involved here, and each must be addressed separately-

The first contract is between the plaintiffs and the Chamber. The plaintiffs purchased their lottery ticket from the Chamber for $150. The defendant has asserted that because this contract is based on the illegal activity involved the plaintiffs can not now seek relief. We disagree with this contention. In Matta v. Katsoulas, 192 Wis. 212, 212 N.W. 261 (1927), the Court was faced with a situation similar to the one presented here. There, the plaintiff had given possession of a lottery ticket he had purchased to the defendant so that the defendant could pick the car up for him. After the defendant took possession of the ear, he refused to turn the car over to the plaintiff, and when sued, used the illegality of the lottery as his defense. The court there stated:

“The defendant cannot defeat plaintiffs recovery by showing that the automobile was secured by means of a lottery which was in violation of law. The owner of the roof garden [the conductor of the lottery] was the only one who could be heard to maintain that plaintiff was not entitled to the automobile because the drawing was held contrary to law.”

192 Wis. at 213, 212 N.W. at 261. The court then decided that the plaintiff was entitled to the car and awarded title to him, notwithstanding the underlying illegality of the lottery, because “[t]he rule that the law will not enforce an illegal contract has application only as between the immediate parties to the contract.” 192 Wis. at 214, 212 N.W. at 262. See also, Marx v. Lining, 231 Ala. 445, 165 So. 207 (1935) (contracts offensive to the public policy of the state may be enforced because of the inability of an affected party to plead their invalidity).

According to 38 Am.Jur.2d Contracts § 59, p. 154 (1968), the receiving of a prize awarded in a lottery, if it is voluntarily delivered, is not prohibited. Because the parties to this first contract are content to allow its voluntary enforcement, Mr. Youngblood, the party to the subsequent contract, may not plead the underlying illegality of the first contract as his defense.

The subsequent contract between the plaintiffs and the defendant for the resale of the lottery ticket is the next item to be addressed. Here, the defendant asserted the following affirmative defense to the action filed by the plaintiffs:

“The action brought by the Plaintiffs herein is based upon, in consideration of, or in furtherance of the promotion, advance, or participation in a lottery, which is illegal under the laws of the State of Alabama, and, each of the parties hereto being in pari delicto is barred from seeking judicial relief to change the result or outcome of said illegal activity.”

We agree with the defendant’s contention that the contract between himself and Ms. Bailey is based upon an illegal activity and therefore void. This is because 20% of the agreed upon purchase price was to be paid to the Chamber as conductor of the lottery, and if part of the transaction was prohibited by law then the entire transaction was void and not enforceable to any extent. Booker T. Washington Ins. Co. v. Roberts, 228 Ala. 206, 209, 153 So. 409, 411 (1934).

We disagree, however, with the defendant’s statement that the parties involved here are in pari delicto. The trial court specifically found that the defendant knew, at the time he purchased the plaintiffs’ ticket, that the account he was writing his checks on had insufficient funds to cover them. Testimony was also produced at trial to indicate that this was in fact the fourth time the defendant had utilized the same scheme to defraud persons out of lottery tickets. There is an exception to the general rule concerning the enforcement of illegal contracts by courts of law. This exception is stated in 17 C.J.S. Contracts § 274, p. 1198-99 (1963):

“Where the parties are not in pari de-licto, or equally guilty, which they may not be, and where public policy is considered as advanced by allowing either, or at least the more excusable of the two, to sue for relief against the transaction, relief will be given....
“The cases of this character exist generally where the party asking to be relieved from the effect of an illegal agreement was induced to enter into the same by means of fraud; here he is not regarded as being in pari delicto with the other party, and the court may relieve him.”

In Alabama case law, this exception has been accepted with approval. In Horticultural Development Co. v. Schneider, 225 Ala. 667, 145 So. 135 (1932), the plaintiff sought to have a contract for the purchase of real estate, which had previously been declared void and illegal as against public policy, rescinded and cancelled. This Court decided that because the contract had been procured by the fraud of the defendant, the parties were not in pari delicto, and the courts would therefore grant relief to the plaintiff. The Court cited 13 Corpus Juris 498, which makes the statement quoted above from 17 C.J.S., as authority for this decision. In Thompson v. Wiik, Reimer, & Sweet, 391 So.2d 1016 (Ala.1980), the plaintiff signed a contract to sell a business that contained within it a covenant not to compete. The contract provided that the defendants would make monthly payments to the plaintiff for six years. However, the defendants stopped making payments with one and one-half years remaining on the contract, and the plaintiff filed suit. This Court decided that the covenant not to compete made the contract illegal and void. We then discussed the exception stated above and accepted the proposition. However, in that case, it was said not to apply because there was no claim or evidence of fraud. As previously discussed, in the present case the fraud of the defendant has been claimed and proven.

Therefore, even though the contract between the plaintiffs and the defendant is based on an illegal lottery, we believe these plaintiffs are deserving of relief because of the fraud perpetrated on them by the defendant. We therefore reverse the order of the trial court awarding the car to Ms. Davis as a good faith purchaser. Under our reasoning today, Ms. Davis would not be a “good faith purchaser,” because the defendant Youngblood, her transferor, received a void title from the contract between himself and the plaintiffs. Code 1975, § 7-2-403, states, “[A] purchaser of goods acquires all title which his transferor had or had power to transfer .... ” Here, the defendant received no title under this void contract, and, hence, no person could be a “good faith purchaser” of his title.

Because of our decision to award the car to the plaintiffs, we also reverse the trial court’s award of $800 compensatory damages to the plaintiffs. Compensatory damages are intended only to reimburse persons for the losses suffered by reason of an injury to person or property. Matheny v. Petersen, 276 Ala. 478, 483, 163 So.2d 636, 638 (1964). Here, the trial court made the determination that the plaintiffs were entitled to compensation for the loss they sustained by not receiving the purchase price for their lottery ticket. However, because we have determined that the sale of that ticket was void, due to the underlying illegality of the transaction, that is not the loss the plaintiffs suffered. Instead, the loss here is the inability of the plaintiffs to obtain the title to a car that was theirs. Therefore, the plaintiffs are entitled to be awarded title to the car. Generally, an award of compensatory damages connotes the giving of an equivalent or substitute of equal value for a loss or injury. Given that the loss suffered by the plaintiffs was their inability to obtain title to the car, we recognize that the award of title to the car to the plaintiffs may not meet the technical definition of compensatory damages. Nevertheless, in the context of this case, the award is so similar in nature to that of one for compensatory damages as to be almost indistinguishable. Therefore, the award is sufficient to sustain the trial court’s award of punitive damages.

As to the trial court’s award of attorney fees in the interpleader action, the decision to impose the attorney fees on the defendant cannot be allowed to stand. Though we recognize that the imposition of attorney fees in an interpleader action is at the discretion of the trial court, Air Movers of America, Inc. v. State Nat’l Bank of Alabama, 293 Ala. 312, 302 So.2d 517 (1974), there is nothing in the interpleader rule, A.R.Civ.P. 22, to sustain such an award against the defendant in this case. Under the interpleader rule, attorney fees are to be disbursed out of the “fund or property” that is interpleaded. In this case, the “property” interpleaded by the Chamber was the prize it sought to award through the lottery, i.e., the car. Because the trial court assessed the attorney fees directly against the defendant and did not make them payable out of the “fund or property” interpleaded, its order, as such, cannot be sustained. However, we hold that an award of attorney fees, in accordance with the procedure outlined by A.R. Civ.P. 22, is appropriate out of the property interpleaded by the Chamber.

We therefore hold that the trial court erred in awarding the automobile to Louise Davis. We affirm the award of $10,000 punitive damages as ordered by the trial court. As regards the imposition of attorney fees, we remand the cause to the trial court with instructions to make the award payable out of the property interpleaded. We reverse the trial court’s award of $800 as compensatory damages.

AFFIRMED IN PART; REVERSED IN PART; AND REMANDED WITH INSTRUCTIONS.

MADDOX, ALMON, SHORES, EMBRY, BEATTY and ADAMS, JJ., concur.

FAULKNER and JONES, JJ., not sitting.


author: BEATTY, Justice. BEATTY, Justice.

text:
    CHAMBERS COUNTY COMMISSIONERS v. Jon Tracy WALKER, et al.
    83-508.
    Supreme Court of Alabama.
    Sept. 28, 1984.
    As Modified on Denial of Rehearing Oct. 26, 1984.

      Robert M. Girardeau of Huie, Fernam-bucq & Stewart, Birmingham, for appellant.
    W.F. Horsley of Samford, Denson, Hors-ley, Pettey, Martin & Barrett, Opelika, for appellees.
   BEATTY, Justice.

Defendants-intervenors, the Chambers County Commissioners (Commissioners), appeal from the grant of plaintiffs’ motion for relief from judgment and the court’s dismissal of the first lawsuit arising out of an automobile accident. We reverse and remand.

On February 2, 1979, automobiles driven by Jon Tracy Walker and Steve Lamar Green were involved in a collision around 10:00 p.m. on Chambers County Road 87, near Fairfax, Alabama. Jon Tracy Walker suffered severe injuries in the accident. Both drivers were minors at the time.

On February 4, 1980, Jon Tracy Walker, suing through his parents, Johnny M. and Barbara L. Walker, and joined by his parents suing individually, brought an action against defendants Steve Lamar Green and his father, William T. Green. In their complaint, plaintiffs alleged negligent and wanton conduct on the part of Steve Lamar Green; however, they did not state a cause of action against William T. Green, although plaintiffs alleged he was the “owner of the vehicle operated by Steve Lamar Green” and demanded “judgment against the Defendants.”

Several events and transactions concerning this first lawsuit occurred on March 28, 1980: plaintiffs’ counsel was appointed guardian ad litem for Jon Tracy Walker; a settlement agreement was reached between the parties; and a release in full was executed. After a pro ami hearing, a judgment based on the settlement agreement was also entered on March 28 in favor of the plaintiffs in the amount of $17,331. The record indicates that this amount was paid into court on March 28, 1980, and disbursed on April 16,1980, in two separate checks: one paid to Johnny Walker and Barbara Lynn Walker in the amount of $7,331, and one paid to Barbara Lynn Walker in the amount of $10,000.

In a second action filed December 18, 1981, against the Commissioners, plaintiffs alleged negligence and wantonness in the county’s construction, operation, and maintenance of the intersection near where the automobile accident sub judiee occurred. The Commissioners moved for summary judgment in this second action, citing as grounds satisfaction of the prior judgment and the release in full executed by plaintiffs.

Later, on March 28, 1983, pursuant to ■Rules 54(b) and 60(b)(6), A.R.Civ.P., plaintiffs filed a motion for relief from or revision of the judgment entered in the first action exactly three years earlier on March 28, 1980. Thereafter, on May 11, 1983, the trial court permitted the Commissioners to intervene in the plaintiffs’ motion, and, on June 20, 1983, consolidated the first action and the second action for all pre-trial proceedings only.

Following a hearing on September 26, 1983, during which evidence and arguments were presented on both the Commissioners’ motion for summary judgment in the second action and plaintiffs’ motion for relief from or revision of the judgment in the first action, the trial court granted plaintiffs’ motion by the following order entered January 24, 1984:

“ORDER GRANTING RELIEF FROM JUDGMENT AND DISMISSING CASE
“On March 28, 1983, plaintiffs filed their Motion for Relief from Judgment. On September 26, 1983, the Court heard the evidence and oral arguments of the attorneys. The Court has considered the evidence, arguments of the attorneys, and the Briefs filed by the attorneys. The Court is of the opinion, and so finds, that the plaintiffs are entitled to relief from the Judgment entered in this ease on March 28, 1980.
“It is, therefore, ORDERED, ADJUDGED AND DECREED as follows:
“1. The Judgment entered in this case on March 28, 1980, is hereby vacated, set aside, and annulled;
“2. The purported satisfaction of the Judgment of March 28, 1980, is hereby vacated, set aside, and annulled;
“3. This case is hereby dismissed without prejudice.”

From this, we may assume that the trial court also entered an order denying the Commissioners’ summary judgment motion, although an order to that effect is not contained in the record on appeal. Nevertheless, it is from the grant of plaintiffs’ motion that the Commissioners appeal.

The first argument advanced by the Commissioners is that the trial court granted to the plaintiffs Rule 60(b)(6) relief, and, in so doing, abused its discretion, because the grounds set forth by plaintiffs fall not under Rule 60(b)(6) but under Rule 60(b)(1), which carries with it a four-month time limitation. Rule 60(b), in pertinent part, is set forth below:

“On motion and upon such terms as are just, the court may relieve a party or his legal representative from a final judgment, order, or proceeding for the following reasons: (1) mistake, inadvertence, surprise, or excusable neglect ... or (6) any other reason justifying relief from the operation of the judgment. The motion shall be made within a reasonable time, and for reasons (1), (2), and (3) not more than four months after the judgment, order, or proceeding was entered or taken....”

In their motion for relief under Rule 60(b)(6), plaintiffs alleged the following grounds:

“2. Plaintiff’s attorney ... informed Plaintiff that judgment in the above styled action would not prevent an action against Chambers County or the Chambers County Commission.
“3. That plaintiff, his attorney, the attorney for Defendants, and th% Judge presiding over said proceedings, engaged in a discussion whereby Plaintiff was assured that he could proceed in this cause with an action against Chambers County and the Chambers County Commission arising out of the same facts as the instant action.
“4. None of the parties involved in the above styled case intended or perceived that a judgment in the same would bar an action against Chambers County or the Chambers County Commission.
“5. All Plaintiffs in the above styled action were advised and informed that a judgment in said case would not preclude an action against Chambers County and Chambers County Commission or they would not have consented to judgment in this cause.
“6. Plaintiff Jon T. Walker suffered injuries and damages that result in the accident giving rise to this suit so that to make it obvious that the sum received in this particular action to be full compensation for all injuries received by Plaintiff and Plaintiffs request leave of court to present evidence at a hearing in this cause [sic].
“7. Jon T. Walker was, at the time of the Court’s order, a minor who was suffering from numerous disabilities and his right to a suit against Chambers County and Chambers County Commission were not adequately protected.”

We agree with the Commissioners in their contention that the grounds set forth above, under Rule 60(b), except paragraph number six, amount to a claim of mistake and/or inadvertence on the part of plaintiffs’ counsel as to the effect the settlement, release, and judgment in the first action would have on any subsequent suit plaintiffs sought to maintain against the Commissioners. Therefore, if plaintiffs’ right of action against the Commissioners was not “adequately protected,” it was due to the mistake and/or inadvertence of plaintiffs’ counsel. Indeed, plaintiffs’ counsel as much as admitted this in response to questions asked by counsel for the Commissioners at the September 26, 1983, hearing on the motions:

“Q. —by Order of Judge Avary on March 28th you were appointed Jon Tracy Walker’s guardian ad litem.
“A. O.K. Then I just didn’t recall. I don’t have any question about that but that was not the sole basis of my representation of him was the guardian ad litem.
“Q. But one of the factors of your representation was in the capacity as guardian ad litem?
“A. Yes, sir.
“Q. And, as guardian ad litem you looked out for the interests of the person whom you’re representing?
“A. Yeah.
“Q. And that person, according to the Order, is Jon Tracy Walker.
“A. That’s correct.
“Q. All right. Have you read the case of Williams vs. Woodman?
“A. I’m afraid so.
“Q. And had you been aware of that line of cases which Williams vs. Woodman is based upon, you would not have gone through with this pro ami, would you?
“A. No, sir. I would have withdrawn and immediately had additional counsel brought in.”

The case of Williams v. Woodman, 424 So.2d 611 (Ala.1982), referred to in the above quote by counsel for the Commissioners, held:

“ ‘The discharge or satisfaction of a judgment against one of several persons each of whom is liable for a tort, breach of contract, or other breach of duty, discharges each of the others from liability therefor.’ Restatement of Judgments § 95 (1942). See also Restatement (Second) of Torts § 886 (1979).” 424 So.2d at 613.

Furthermore, in addressing the grounds set forth in number six of plaintiffs’ Rule 60(b)(6) motion, which seems to allege that plaintiffs received insufficient damages, we note that Woodman, supra, also makes it clear that the prior judgment operated as a bar to any subsequent action plaintiffs sought to maintain against the Commissioners, even if, as plaintiffs allege, “full compensation” was not received in the first action:

“Where a judgment against a defendant liable for the entire harm is satisfied, that extinguishes the obligation of another wrongdoer, and ‘the fact that the plaintiff recovered only part of the damages to which he was entitled is immaterial.’ 2 Freeman on Judgments § 578, p. 1225.” 424 So.2d at 614.

The categories for relief under Rule 60(b) are mutually exclusive, and grounds for relief under Rule 60(b)(1) cannot be valid grounds under Rule 60(b)(6), in the absence of aggravating circumstances sufficient to permit the trial court to say that the case is properly within 60(b)(6) — (e.g., where a motion for relief is filed more than four months after dismissal of the case where the dismissal was the result of the mistake, inadvertence, or excusable neglect of counsel, but the delay in filing the motion for relief was due to the active misrepresentation by counsel to his client as to the status or progress of the case.) See Giles v. Giles, 404 So.2d 649 (Ala.1981); Charles Townsend Ford, Inc. v. Edwards, 374 So.2d 900 (Ala.Civ.App.1979).

The record clearly shows that plaintiffs were able to prove grounds for relief only under Rule 60(b)(1), and failed to show any aggravating circumstances elevating the grounds of mistake or inadvertence of counsel to such grounds requiring relief under Rule 60(b)(6). “Relief under Rule 60(b)(6) is reserved for extraordinary circumstances, and is available only in cases of extreme hardship or injustice.” Douglass v. Capital City Church of the Nazarene, 443 So.2d 917, 920 (1983), citing Howell v. D.H. Holmes, Ltd., 420 So.2d 26 (Ala.1982). Nor can Rule 60(b)(6) be used “for the purpose of relieving a party from the free, calculated, and deliberate cfioices he has made. A party remains under a duty to take legal steps to protect his own interest.” See 11 C. Wright & A. Miller, Federal Practice & Procedure, § 2864 at 214-215 (1973).

Moreover, the trial court in the prior action complied with the mandate of Abernathy v. Colbert County Hospital, 388 So.2d 1207 (Ala.1980), that courts should not, pro forma, ratify pro ami settlements. That case held that a hearing is required to determine whether a settlement is in the best interests of the child, and that “[s]uch a hearing requires [an] ... extensive examination of the facts.” 388 So.2d at 1209. The judgment in the initial action reflects the proper handling of a pro ami hearing, settlement, and judgment:

“JUDGMENT
“This day in open Court came the Plaintiffs by and through their attorney of record and the Defendants by and through their attorney of record and by consent of the Plaintiffs and the Defendants made in open court on this day this case comes to be heard. The Plaintiffs by and through their attorney and the Defendants by and through their attorney have made known to the Court that they have entered into a settlement of this cause and upon the oral testimony heard by the Court of the Plaintiff, JON TRACY WALKER, his mother, his father and Defendant, the Court is of the opinion that settlement between the parties is fair and in the best interest of the minor Plaintiff. Therefore, the Court enters judgment in favor of the Plaintiffs, JOHNNY M. WALKER and BARBARA LYNN WALKER against the Defendant, STEVE LAMAR GREEN for the amount agreed upon between the parties, to-wit, the sum of SEVEN THOUSAND THREE HUNDRED THIRTY ONE AND NO/100 — ($7,331.00)—DOLLARS, and in favor of the Plaintiff, JON TRACY WALKER and against the Defendant, STEVE LAMAR GREEN for the sum of TEN THOUSAND AND NO/100 — ($10,000.00)—DOLLARS, the same to be paid to the Clerk of the Circuit Court of Chambers County, Alabama, and to be paid by her to the Plaintiff, JON TRACY WALKER upon his reaching his majority or to be paid by her to any legal guardian for said minor, JON TRACY WALKER, who may hereafter be appointed.
“It is Therefore, CONSIDERED, ORDERED, AND ADJUDGED by the Court that the Plaintiffs, JOHNNY M. WALKER and BARBARA LYNN WALKER have and recover of the Defendant, STEVE LAMAR GREEN the sum of SEVEN THOUSAND THREE HUNDRED THIRTY ONE AND NO/100 — ($7,331.00)—DOLLARS and the Plaintiff, JON TRACY WALKER, a minor, have and recover of the Defendant, STEVE LAMAR GREEN, the sum of TEN THOUSAND AND NO/100— ($10,000.00) — DOLLARS, the amount of damages assessed by the Court together with all court costs of this proceeding for the recovery of which let execution issue.”

While we recognize that the decision to grant or deny a Rule 60(b)(6) motion is within the discretion of the trial court, and the standard of this Court’s review is whether the trial court abused its discretion, this discretion, however, is not unbridled. Douglass v. Capital City Church of the Nazarene, supra; Giles v. Giles, su pra. On these facts we must conclude that the trial court abused its discretion in granting relief under Rule 60(b)(6).

Nor are we persuaded by plaintiffs’ contention that the March 26, 1980, pro ami judgment was interlocutory under Rule 54(b), and therefore that this judgment was subject to revision at any time. Plaintiffs reason that because the judgment did not mention William Green, who was a named defendant, the judgment only adjudicated the liability of Steve Green, William Green’s soil. We disagree.

Rule 54(b) provides in pertinent part: “[A]ny order or other form of decision, however designated, which adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties shall not terminate the action as to any of the claims or parties, and the order or other form of decision is subject to revision at any time before the entry of judgment adjudicating all the claims and the rights and liabilities of all the parties.”

While it is true that neither the judgment nor the agreement of the parties, upon which the judgment was based, named William Green, the release in full does name William Green:

“RELEASE IN FULL
“For the sole and only consideration of SEVEN THOUSAND THREE HUNDRED THIRTY ONE AND NO/100— ($7,331.00) — DOLLARS to us paid, receipt of which is hereby acknowledged, we hereby release and discharge STEVE LAMAR GREEN AND WILLIAM T. GREEN, their heirs, successors, and assigns, and all other persons, firms or corporations who are or might be liable, as a result of any claims of any kind or character which we have or may have against the said STEVE LAMAR GREEN and WILLIAM T.' GREEN, and especially because of all damages, losses, or any claims against the said STEVE LAMAR GREEN or WILLIAM T. GREEN, or injury to persons or property, or both, whether known or unknown, developed or undeveloped, resulting or to result from an accident on or about February 2, 1979, in Chambers County, Alabama, where Chambers County Highway # 87 intersects with 64th Street.
“And we hereby acknowledge full settlement and satisfaction of all claims of whatsoever kind or character which we have or may have against STEVE LAMAR GREEN or WILLIAM T. GREEN by reason of the above mentioned damages, loss or injuries.
“It is further understood and agreed that the payment of said amount is not to be construed as an admission of liability upon the part of said person, firms or corporations, liability being by him expressly denied.” (Emphasis added.)

It is apparent from the record that the omission of William Green’s name from the agreement and the judgment was a mere oversight. Contrary to plaintiffs’ contentions, it appears from the record that they had no intention of pursuing a claim against William Green after receiving the money from the pro ami settlement judgment:

“Q. If you did not feel the amount was adequate why didn’t you go ahead and pursue further claim against the defendants in that pro ami?
“A. Because the boy driving the automobile was young, he was a minor, did not have anything.
“Q. And your understanding was that he and his family had additional assets to pay over and above the insurance?
“A. They were not the defendants and we could find no way to tie, at that point, we were not sure of any way to tie liability into the father.
“Q. Did you investigate the claim of negligent entrustment?
“A. To some degree.” (Emphasis added.)

Plaintiffs took no steps whatsoever to pursue a claim against William Green during the three-year period between the time judgment on the settlement agreement was entered (March 28, 1980), and the time plaintiffs sought relief from that judgment (March 28, 1983). It was only after the plaintiff learned that the pro ami settlement and judgment stood in the way of an action against the Commissioners that plaintiff decided to look for a way to avoid the judgment, e.g., lack of finality under Rule 54(b). As applied to these facts, we find the language of the Court in Jetco Electronic Industries, Inc. v. Gardiner, 473 F.2d 1228, 1231 (5th Cir.1973), appropriate.

“Mindful of the Supreme Court’s command that practical, not technical considerations are to govern the application of principles of finality [citations omitted], we decline appellee’s invitation to exalt form over substance by dismissing this appeal.”

Beyond this, we note that plaintiffs, in their motion for relief, requested either Rule 60(b)(6) relief from final judgment or Rule 54(b) revision of nonfinal judgment, but, in their brief in support of their motion, plaintiffs argued more strongly in favor of a Rule 54(b) revision by pointing out that Rule 60(b)(6) relief may be “premature.” Nevertheless, it is abundantly clear from the trial court’s order that it granted plaintiff relief under Rule 60(b)(6). See the trial court’s order quoted above. Consequently, plaintiff’s argument with respect to the application of Rule 54(b) to the judgment in the prior action is not well taken on this appeal. Considering the entire record, we conclude, therefore, that the parties and the court intended that the settlement judgment adjudicate all of the claims plaintiffs had against both defendants, father and son.

For the foregoing reasons, we reverse the order of the trial court setting aside the March 28, 1980, judgment and dismissing the case, and remand the cause with instructions that the judgment be reinstated. It is so ordered.

REVERSED AND REMANDED.

MADDOX, JONES, SHORES and ADAMS, JJ., concur.

ON APPLICATION FOR REHEARING

BEATTY, Justice.

OPINION MODIFIED TO ADD FOOTNOTE; APPLICATION OVERRULED.

JONES, SHORES, EMBRY and ADAMS, JJ., concur.

      . We note that the appeal by the Commissioners from the relief granted to the plaintiffs, as opposed to a petition for a writ of mandamus, is appropriate here, since the judgment granting plaintiffs’ motion and dismissing the first action operated as a final disposition of that case. See Littlefield v. Cupps, 371 So.2d 51 (Ala.Civ.App. 1979); 11C. Wright & A. Miller, Federal Practice & Procedure, § 2871, at 260 n. 95 (1973).

      . We note that appellate counsel for Walker was not the attorney representing Walker in the trial court for purposes of the pro ami settlement.