author: BEATTY, Justice.

text:
    DOMINEX, INC. v. Albert W. KEY.
    83-129.
    Supreme Court of Alabama.
    Aug. 24, 1984.

      Bert W. Rice, of Maxwell & Rice, At-more, for appellant.
    Charles R. Godwin, Atmore, for appellee.
   BEATTY, Justice.

This appeal is from the fifth lawsuit arising out of a mortgage foreclosure proceeding and the exercise of a statutory right to redeem 15 acres of land located in Escam-bia County. The appellant, Dominex, Inc., appeals from the grant of a motion to dismiss the complaint in which it sought to compel the appellee, Albert Key, to accept Dominex’s contribution as co-tenant toward the cost of redeeming the subject property and to transfer a one-half interest therein to Dominex. We reverse and remand.

I

A summary of the relevant facts and prior proceedings follows:

On August 4, 1978, James D. Brunson and his first wife, Marie S. Brunson, jointly acquired the subject 15 acres by deed from Dahlia A. Brunson. They subsequently mortgaged the property to the First National Bank of Atmore for $25,000. Some four years later, James and Marie were divorced by a Florida circuit court; however, the divorce decree did not dispose of the realty owned by the parties.

By warranty deed executed April 30, 1982, James Brunson and his second wife, Terri S. Brunson, purported to convey their “interest” in the subject 15 acres to Joel W. Smith and his wife, Opal O. Smith. (This warranty deed, however, was held by the bank and was not recorded until July 19, 1983.) Thereafter, the First National Bank of Atmore commenced foreclosure proceedings on the mortgage, and, on June 23, 1982, the bank sold the 15 acres by mortgage foreclosure deed to Joel W. and Opal Smith for $25,000.

Following the foreclosure and sale, James and Terri Brunson purported to convey to Dominex, Inc., their statutory right of redemption in the 15 acres by using a quitclaim deed executed February 12, 1983. This quitclaim deed did not mention the statutory right of redemption.

Two days later, James Brunson’s first wife, Marie Brunson Cole, joined by her second husband, Roy L. Cole, expressly assigned their statutory right of redemption to Albert W. Key, the appellee herein.

Initially, three complaints were filed by the several parties: first, Dominex filed suit on February 15, 1983, seeking to compel the foreclosure purchasers, Joel and Opal Smith, to permit Dominex to redeem the 15 acres from foreclosure; then, the Smiths filed suit on March 2, 1983, naming Dominex, Brunson, and Key as defendants, seeking a judgment declaring that Brunson had waived his right to redeem, and, therefore, Dominex was estopped from asserting any right of redemption, and further declaring the rights of all parties in or to the real estate in question; and, on March 3, 1983, Albert Key filed suit to compel the Smiths to permit him to redeem the property. On motions filed by Key, the circuit court consolidated these three actions on April 21, 1983.

■Various motions were filed by the several parties in that consolidated action, but pivotal to these proceedings are the following:

(1) Brunson’s motion to dismiss the Smiths’ complaint against Brunson;

(2) Amendment filed by Dominex naming Brunson a party plaintiff to its complaint;

(3) Key’s motion to strike Dominex’s amendment; and

(4) Key’s motion for summary judgment. In its final judgment entered May 26, 1983, the circuit court granted Brunson’s motion to dismiss and Key’s motion to strike, the effect of which was to remove Brunson from the lawsuit; he was not permitted to become a party plaintiff and was dismissed as a party defendant.

The trial court also granted Key’s motion for summary judgment:

“ORDERED, ADJUDGED and DECREED that the Motion for Summary Judgment filed on behalf of Plaintiff, Albert W. Key be and hereby is granted in favor of said Albert W. Key and against all other parties in the above consolidated causes and against all claims and defenses advanced on behalf of such other parties.
“Albert W. Key has in all respects met the statutory requirements for redemption of the land in question and has in fact redeemed said land according to the Code of Alabama of 1975, § 6-5-230 et seq. The Court further finds that no other party to said consolidated causes has redeemed said land nor has any other party complied with the statutory requirements for redemption and that the redemption of said lands by Albert W. Key extinguished further redemption rights in said property as a matter of law.”

Further, despite the yet unrecorded warranty deed executed prior to foreclosure by Brunson to Joel and Opal Smith, the court found that the Smiths, as the mortgage foreclosure purchasers “obtained title to said property by fee simple determinable and said fee was determined by Albert W. Key’s redemption.” Dominex did not appeal this judgment.

On June 10, 1983, James and Terri Brun-son purported to expressly assign their statutory right of redemption to Dominex, which Dominex contends still existed, notwithstanding the May 26th judgment extinguishing all further redemption rights in the property as a matter of law and from which no appeal was taken by Dominex.

Assuming Brunson’s post-judgment status to be that of co-tenant with Key, and Dominex’s status to be that of assignee of Brunson’s statutory right of redemption, Dominex tendered to Key $24,333.88 in contribution for one-half of the amount Key was required to pay to redeem the property from foreclosure. Key refused this tender. Dominex then proceeded with the present action, filed June 21, 1983, to compel Key to accept its contribution toward redemption and to grant to Dominex a one-half interest in the property. The circuit court granted Key’s motion to dismiss on the basis of the prior judgment in the three consolidated actions and for the reasons stated in Key’s motion, including Domi-nex’s lack of standing to bring the action. Dominex appeals from the grant of Key’s motion to dismiss, which was in fact summary judgment because evidence was introduced in support of Key’s motion to dismiss. Rule 12(b)(6), A.R.Civ.P.

The following is a summary of the transactions and the procedural history of this case:

1978

August 4

James and Marie Brunson purchased the 15 acres and executed a mortgage to First National Bank of Atmore.

1982

March 16

James and Marie Brunson divorced without disposing of the 15 acres.

April 30

James Brunson and second wife, Terri, by warranty deed conveyed the 15 acres to Joel and Opal Smith.

June 23

First National Bank foreclosed on the mortgage and sold the 15 acres to Joel and Opal Smith.

1983

February 12

James and Terri Brunson executed a quitclaim deed of the 16 acres to Dominex, Inc.

February 14

Marie Brunson Cole and second husband, Roy Cole, assigned their right to redeem the 15 acres from foreclosure to Albert W. Key.

February 15

Dominex filed suit to compel the Smiths to allow Dominex to redeem.

March 2

The Smiths filed a declaratory judgment action against Brunson, Dominex, and Key, seeking to prevent redemption of the property.

March 3

Key filed suit to compel the Smiths to allow Key to redeem.

April 21

The above three lawsuits were consolidated.

May 26

James Brunson was effectively dismissed as a party to the consolidated lawsuit, and summary judgment was entered in favor of Albert Key.

June 10

James Brunson expressly assigned his statutory right of redemption to Dominex.

June 21

Dominex filed the instant suit against Key seeking to compel Key to allow Dominex, as co-tenant, to contribute one-half the cost of redemption, and grant Dominex one-half interest in the property.

July 19

Joel and Opal Smith recorded the April 30, 1982, warranty deed from James and Terri Brunson, which pri- or thereto had been held by the First National Bank.

September 7

Trial court granted Key’s motion to dismiss Dominex’s complaint.

II

Resolution of the particular issues presented by this appeal necessitates a review and clarification of the law of redemption, both equitable and statutory.

When real property in Alabama is mortgaged, the legal title passes to the mortgagee and the mortgagor retains the equity of redemption, which he may convey. First National Bank of Mobile, v. Gilbert Imported Hardwoods, Inc., 398 So.2d 258 (Ala.1981). If the mortgagor conveys his equity of redemption, his grantee succeeds to this right of redemption, effectively standing in his grantor’s (the mortgagor’s) shoes. Flirt v. Kirkpatrick, 175 So.2d 755, 278 Ala. 61 (1965); Rumage v. Dry Dock Savings Bank, 278 Ala. 526, 179 So.2d 277 (1965). Consequently, because only those with an interest in the property can redeem, a mortgagor who has conveyed his equity of redemption cannot seek to redeem the property, before or after foreclosure. Rumage, supra; Cardwell v. Virginia State Ins. Co., 186 Ala. 261, 65 So. 80 (1914). A valid foreclosure sale of property subject to a mortgage extinguishes the equity of redemption; however, by virtue Code of 1975, § 6-5-230, set forth below, a post-foreclosure right of redemption arises in the mortgagor or his vendee:

“Where real estate, or any interest therein, is sold under execution or by virtue of any judgment in a court of competent jurisdiction or under any deed of trust or power of sale in a mortgage, the same may be redeemed by the debt- or, junior mortgagee, vendee of the debt- or or assignee of the equitable or statutory right of redemption, wife, widow, child, heir at law, devisee or any vendee or assignee of the right of redemption under this Code from the purchaser or his vendee within one year thereafter in the manner provided in this article.”

Unlike the equity of redemption, which exists prior to foreclosure and is deemed an interest in the property, the statutory right of redemption arises after foreclosure and is a mere personal privilege conferred by statute; it is not property or a property right:

“§ 6-5-246
“The statutory rights of redemption given or conferred by this article are mere personal privileges and not property or property rights. The privileges must be exercised by the person and in the mode and manner prescribed by statute. The right or privilege conferred under this article is not subject to levy and sale under execution or attachment nor is it subject to alienation except in the cases provided for in this article; but if the right or privilege is perfected by redemption as provided in this article, then, and not until then, does it become property or rights of property subject to levy, sale, alienation or other disposition, except as is expressly authorized by statute.”

Because a statutory right of redemption is not property or a property right, a deed executed by the mortgagor or his vendee after foreclosure which purports to convey title to or an interest in the property would be ineffective as an assignment of the statutory right of redemption. This reasoning was applied in Wilson v. Mikul, 257 Ala. 112, 113, 57 So.2d 628, 629 (1952):

“The law is settled that a quitclaim deed executed after foreclosure of a mortgage purporting to convey title to the real property covered by the mortgage does not operate as an assignment of the statutory privilege of redemption, unless the privilege of redemption is assigned in expressed terms. [Citations omitted.]”

Thus, such an assignment must be express.

The Court in Wilson v. Mikul, 257 Ala. at 113, 57 So.2d at 629, cited with approval the case of Upchurch v. West, 234 Ala. 604, 176 So. 186 (1937), for the proposition that “a quitclaim deed executed prior to foreclosure while the grantor has the equity of redemption, which is cut off by foreclosure, leaves the grantee in such deed with the privilege of redemption under the statutes.” In Upchurch, Samford Bros., Inc., purchased the equity of redemption from the mortgagor, A.C. Sam-ford, before foreclosure. Then, as stated by the Court in that case:

“On October 18,1933, a few days short of nine months after the foreclosure was had, the said Samford Bros., Inc., for a recited consideration of $1,000 and other valuable considerations to it in hand paid by J.R. Upchurch (complainant here) executed a deed to said Upchurch, in and by which it conveyed to said grantee the said property. This deed contained full covenants of warranty.” (Emphasis added.) 234 Ala. at 607, 176 So. at 188.

The Court went on to hold:

“We entertain no doubt whatever but that the deed from Samford Bros., Inc., was efficacious to vest in the said Up-church the statutory right of redemption which the statute conferred upon the said Samford Bros., Inc., who had purchased the equity of redemption from the said A.C. Samford and wife before the foreclosure was had. This deed conveyed to the complainant, without limitation or qualification, any right, title, interest, claim and estate that the grantor may have owned in the property, and this was certainly sufficient to convey and assign to the grantee any statutory right of redemption the debtor may have had as to the property. There is nothing in the cited cases of Lewis v. McBride, 176 Ala. 134, 57 So. 705, and Leith v. Galloway Coal Co., 189 Ala. 204, 66 So. 149, which conflicts in the least with the present holding.” (Emphasis added.) 234 Ala. at 608, 176 So. at 189.

Clearly, this holding in Upchurch directly conflicts with the holding in Wilson v. Mi-kul, supra. We find Wilson to be the correct result under the plain language of the statute, and to that extent, Upchurch is overruled. The language of § 6-5-246 is clear that a statutory right of redemption is not an interest in property, and a conveyance of an interest in the property will not suffice as an assignment of the personal privilege afforded by the statute to redeem the property after foreclosure.

Ill

A.

The threshold issue in this case is whether Dominex is precluded from asserting its claim by the doctrines of res judicata or collateral estoppel.

On appeal, Dominex argues that the May 26th judgment granting exclusive redemptive rights in the property to Albert Key did not deprive Brunson of his statutory right of redemption as co-tenant in the property and his attendant right to contribute one-half the cost toward redeeming the property, thus “rehabilitating” his interest therein. Dominex also argues that the pri- or judgment did not preclude Brunson from assigning those statutory redemptive rights to Dominex, who could exercise them by tendering contribution to Key.

Key contends, among other things, that Dominex’s claim to a one-half interest in the property under the above described theory is precluded by res judicata and collateral estoppel, because Dominex’s claim reaches a matter which might or ought to have been raised in the prior litigation. We disagree and find that Dominex’s claim is not barred by either res judicata or collateral estoppel.

The elements of res judicata were set out by this Court in Wheeler v. First Alabama Bank of Birmingham, 364 So.2d 1190, 1199 (Ala.1978), affirmed, 385 So.2d 47 (Ala.1980):

“Res judicata and collateral estoppel (estoppel by judgment) are two separate rules or sets of rules for determining the conclusiveness of judgments. See Webster v. Gunter, 336 So.2d 170, 172 (Ala.1976) (Almon, J., concurring specially).
“The elements of res judicata are as follows: (1) prior judgment rendered by court of competent jurisdiction; (2) prior judgment rendered on the merits; (3) parties to both suits substantially identical; and (4) same cause of action present in both suits. Stevenson v. International Paper Co., 516 F.2d 103 (5th Cir.1975). If these elements are present, then the former judgment is an absolute bar to any subsequent suit on the same cause of action, including any issue which was or could have been litigated in the prior action. McGruder v. B & L Construction Co., 331 So.2d 257 (Ala.1976).”

The first three elements of res judi-cata are clearly present in this case. The remaining issue under that doctrine is whether the cause of action is the same in both the original action and the present action. The determination of this depends on whether the issues in the two suits are the same and whether the same evidence would support a recovery in both suits. Geer Brothers, Inc. v. Crump, 349 So.2d 577 (Ala.1977), quoting Sessions v. Jack Cole Co., 276 Ala. 10, 158 So.2d 652 (1963).

While we do not undertake to rule on the correctness of the prior judgment, we must, nevertheless, examine the issues and the evidence that were before the court in order to determine whether the causes of action in these two lawsuits are the same.

The primary issue before the court in the prior lawsuit was which of the parties had the statutory right to redeem the subject property from the foreclosure purchasers. The evidence advanced by each of the parties in support of their respective rights was as follows: First, Dominex asserted that it had acquired the statutory right to redeem by virtue of its quitclaim deed executed after foreclosure by James Brunson, who remained a co-tenant in the property with Marie Brunson Cole following their divorce. Key, on the other hand, asserted his right to redeem on the strength of the express assignment from Marie Brunson Cole of her statutory right of redemption after foreclosure.

As we recognized above, a mere quitclaim deed executed after foreclosure is ineffective as a transfer of the statutory right of redemption. An express assignment of that statutory privilege is required. We assume the trial court applied this rule in entering summary judgment in favor of Key and against Dominex. We note here that this determination of the ineffectiveness of the quitclaim deed, under which Dominex asserted its rights, does not operate as an adjudication of the issue of whether Brunson, Dominex’s grantor, had the statutory right to redeem at the time he executed the quitclaim deed to Dominex. Clearly, under the law of redemption enunciated above in Part II, Brunson had no interest in the property after foreclosure. As previously pointed out, Brunson was effectively removed as a party to the prior litigation. The trial court refused to permit Dominex to amend its complaint to add him as a party-plaintiff, and, therefore, Brunson could not assert his statutory right to redeem in those proceedings. Thus, Brunson's post-foreclosure rights were not before the court. Nor was a determination thereof implicit in the judgment for Key and against Dominex. The trial court did not have to reach the issue of Brunson’s interest in order to rule against Dominex because of the ineffective quitclaim deed. Dismissal of Brunson as a party is indicative of this. Consequently, the only material evidence before the Court in the prior proceeding, on the issue of who (as between Dominex and Key) could statutorily redeem, was the quitclaim deed and the express assignment.

In the present lawsuit, however, different evidence and different issues were before the trial court. It is reasonable to conclude from the events before and after the entry of summary judgment for Key that both Brunson and Dominex realized the ineffectiveness of the quitclaim deed. Dominex first sought to amend its complaint by adding Brunson as a party plaintiff, but was not permitted to do so. And, rather than appealing the judgment for Key and thereby proceeding on the strength of an invalid transfer, Brunson expressly transferred to Dominex his “statutory right of redemption together with all other related rights of redemption or any right whatsoever in and to” the subject property. Then, Dominex, as assignee of a co-tenant, brought suit to compel Key, who had refused tender by Dominex, to accept its contribution toward the cost of redemption.

By virtue of this new evidence, i.e., the express transfer by Brunson, and the prior statutory redemption of the property by Key, new issues are presented, which were not settled or determined by the prior lawsuit: (1) Did James Brunson, as a co-tenant, have the statutory right to redeem the property after foreclosure? (2) If he did, does redemption by Key extinguish the right James Brunson had because the property may be redeemed only once? (3) Is statutory redemption as between co-tenants a race of diligence, or does the law in Alabama recognize the equitable right of a co-tenant (Brunson) to make a timely contribution to the redeeming co-tenant (Key) and thus share in the redemption, notwithstanding the fact that foreclosure extinguished the Brunsons’ interests in the property? (4) If the law recognizes such an equitable right, is it assignable or transferable? (5) If this right is assignable or transferable, was the transfer executed by James Brunson on June 10, 1983, effective to transfer this right?

Concluding that the issues in the two lawsuits are different, we further find that the evidence supporting the recovery for Key in the first action does not preclude the recovery sought by Dominex in the present action.

Because the causes of action in the prior and present lawsuits are different, we conclude that the present action is not barred by res judicata. Nor is the present action barred by collateral estoppel, which “operates where the subsequent suit between the same parties is not on the same cause of action.” Wheeler v. First Alabama Bank of Birmingham, supra:

“Requirements for collateral estoppel to operate are (1) issue identical to one involved in previous suit; (2) issue actually litigated in prior action; and (3) resolution of the issue was necessary to the prior judgment. Stevenson v. International Paper Co., supra. If these elements are present, the prior judgment is conclusive as to those issues actually determined in the prior suit. Gulf American Fire & Casualty Co. v. Johnson, 282 Ala. 73, 209 So.2d 212 (1968).” 364 So.2d at 1199.

As explained above, the present action presents new issues that were not litigated in the prior action. Nor was resolution of these issues necessary to the prior judgment, which determined that Key had validly obtained the statutory right to redeem and had complied with the redemption statutes.

B.

We shall now proceed to address the merits of this appeal. Besides the issues outlined above, Key raises the issues of estoppel and waiver. First, Key argues that because of the warranty deed to the Smiths executed by Brunson on April 30, 1982, Brunson is estopped from transferring to Dominex any rights he may have in or to the subject property. Second, Key argues, if Brunson is deemed to have any rights, those rights would pass to the Smiths under the doctrine of after-acquired title, and not to Dominex. Key also contends, in essence, that Dominex cannot be a bona fide purchaser from Brunson, because it took Brunson’s post-judgment transfer with actual knowledge of the prior warranty deed from Brunson to the Smiths, and with notice that the grantees thereto (the Smiths) were claiming through it. Third, Key argues that, notwithstanding the warranty deed, Brunson’s denial of any interest in the property, through his pleadings and letter brief filed in the prior proceedings, operates as a waiver of any interests he may have and estops him from making any subsequent transfers.

1. Estoppel by Deed.

In response to Key’s arguments regarding the effect of the Smiths’ warranty deed, Dominex argues that the deed was ineffective to convey title or serve as a basis for estoppel because there was no delivery of the deed. We find that the issue of the validity of the warranty deed is res judicata. Implicit in the final judgment in the prior consolidated proceeding, as well as in another lawsuit filed by the Smiths the day after Dominex filed the present suit, is the conclusion that this warranty deed was invalid and ineffective to transfer title to the Smiths.

In their original complaint in the consolidated proceeding, the Smiths admitted that “[t]he original deed in question is still being held by the First National Bank of Atmore, and the same has not been delivered to anyone as of [the date this complaint was filed].” The court, in its final judgment, held that the Smiths, as the mortgage foreclosure purchasers, “obtained title to said property by fee simple determinable and said fee was determined by Albert W. Key’s redemption.” Under the law of redemption, enunciated above, had the warranty deed been effective, the Smiths would have thereby acquired Brun-son's equity of redemption. Notwithstanding that they were also the foreclosure purchasers, the Smiths, had they acquired Brunson’s equity of redemption prior to foreclosure, upon foreclosure would have succeeded to his statutory right of redemption and been able, in effect, to redeem from themselves. The prior judgment, however, held otherwise and determined their interests to be only those of foreclosure purchasers.

On May 27, 1983, the day after final judgment was entered in the consolidated action, the Smiths sought to amend their complaint to allege that the warranty deed was delivered to them on the date of its execution. This post-summary judgment amendment had no effect. Stallings v. Angelica Uniform Co., 388 So.2d 942 (Ala.1980); Papastefan v. B & L Construction Co., 356 So.2d 158 (Ala.1978). Then, on June 22, 1983, (the day after Dominex filed the present suit against Key), the Smiths filed a new lawsuit against Key, claiming under the warranty deed and alleging the same co-tenancy theory advanced by Domi-nex herein. The trial court entered summary judgment against the Smiths on July 18, 1983, “by reason of estoppel by deed, estoppel by pleadings, issue preclusion and res judicata and lack of standing of Plaintiff to maintain said cause.” The next day, the Smiths recorded the warranty deed. No appeal was taken from the July 18th judgment, but on August 5, 1983, the Smiths filed notice of appeal to this Court from the May 26th judgment. Subsequent to their notice of appeal, the Smiths entered into a settlement agreement with Key, and, on joint motions of the parties, this Court dismissed the Smiths’ appeal on October 3, 1983. From the foregoing, the preclusive effect of the prior judgments is clear. The issue remains, nevertheless, as to whether an invalid deed can operate as an estoppel. We note a paucity of Alabama law on this issue.

Generally, estoppel by deed against the grantor or those in privity with him may be invoked only in an action on the deed itself brought by the grantee or those in privity with him. Howard v. Perkins, 229 Ga. 279, 191 S.E.2d 46 (1972); Hughes v. Cobb, 195 Ga. 213, 23 S.E.2d 701 (1942); 31 C.J.S. Estoppel §§ 10, 13, 46 (1964). This follows from the general rule that the party claiming the benefit of the estoppel must show he was induced to change his course or position because of statements or representations in the deed. Storey v. Patterson, 437 So.2d 491 (Ala.1983); Hendricks v. Blake, 291 Ala. 575, 285 So.2d 82 (1973); 31 C.J.S. Estoppel § 10. Moreover, an invalid instrument will not serve as the basis of an estoppel by deed, even though it may contain covenants of warranty. Clark v. Bird, 158 Ala. 278, 48 So. 359 (1909); Harden v. Darwin & Pulley, 77 Ala. 472 (1884); Consolidation Coal Co. v. Riddle, 198 Ky. 256, 248 S.W. 530 (1923); 31 C.J.S. Estoppel §§ 17, 43 (1964).

Applying the foregoing principles to the facts of this case, we conclude that Key cannot assert estoppel by deed against Brunson or Dominex. First, this is not an action on the deed itself. Second, Key is not in privity with the Smiths, nor has he shown he relied to his detriment on the contents or the validity of the deed. Third, as we pointed out above, the prior judgments concluded that the deed was invalid, and, therefore, it may not serve as the basis of an estoppel by deed.

2. After-acquired Title.

The doctrine of after-acquired title is a form of estoppel by deed. It operates to estop a grantor, who executes a deed purporting to convey land to which he has no title or to which he has a defective title at the time of the conveyance, from claiming in opposition to his deed as against the grantee or any person claiming title under him, when such grantor afterward acquires a good title to the land. The chief theory upon which the doctrine rests is that the deed operates on the after-acquired title by way of an estoppel. 23 Am.Jur.2d Deeds § 341 (1983).

There are certain limitations upon the doctrine of estoppel by deed as it concerns an after-acquired title: One seeking to invoke the doctrine must have some right or interest in the premises, and application of the doctrine presupposes that the instrument relied upon is valid and effective to operate as a conveyance. 23 Am. Jur.2d Deeds §§ 342, 335 (1983). See also Rogers v. Snow Brothers Hardware Co., 186 Ark. 183, 52 S.W.2d 969 (1932); Dailey v. Springfield, 144 Ga. 395, 87 S.E. 479 (1915).

We find the doctrine inapplicable to this case for several reasons. First, at the time the deed was executed, Brunson’s title to his one-half interest in the property was not defective. And, as pointed out above, Key is not claiming title under the Smith deed, although he does have “some right or interest in the premises.” Nor is the validity or effectiveness of the Smith deed subject to challenge in this lawsuit, that issue having been precluded by the prior judgments against the Smiths. Consequently, Dominex cannot be charged with actual notice of a prior effective conveyance by Brunson. The judgment in the prior consolidated proceedings, wherein Dominex sought to challenge the validity of the Smith deed, was rendered prior to Brunson’s transfer of his statutory right of redemption to Dominex.

3. Equitable Estoppel and Waiver.

Key contends that, notwithstanding the warranty deed, Brunson’s denial of any interest in the property, through his pleadings and letter brief filed in the prior proceedings, operates as a waiver of any interests he may have and estops him from making subsequent transfers.

“The essential elements of equitable estoppel are: (1) the person against whom estoppel is asserted, who usually must have knowledge of the facts [or at least the circumstances must be such that knowledge of them is necessarily imputed to him], communicates something in a misleading way, either by words, conduct, or silence, with the intention that the communication will be acted on; (2) the person seeking to assert es-toppel, who lacks knowledge of the facts, relies upon that communication; and (3) the person relying would be harmed materially if the actor is later permitted to assert a claim inconsistent with his earlier conduct. Mazer v. Jackson Ins. Agency, 340 So.2d 770, 773 (Ala.1976).” General Electric Credit Corp. v. Strickland Division of Rebel Lumber Co., 437 So.2d 1240, 1243 (Ala.1983).

Furthermore, the law is settled in Alabama that a party in a pending suit who has knowledge of the facts may be precluded from assuming a position inconsistent with a position taken in a prior judicial proceeding to the prejudice of an adverse party. Brooks v. Peoples National Bank of Huntsville, 414 So.2d 917 (Ala.1982); Henson v. McDonald, 413 So.2d 1135 (Ala.1982); Russell v. Russell, 404 So.2d 662 (Ala.1981); United Security Life Ins. Co. v. Birmingham Trust National Bank, 282 Ala. 295, 211 So.2d 139 (1968); Hartley v. Alabama National Bank of Montgomery, 247 Ala. 651, 25 So.2d 680 (1946); LeFurgey v. Beck, 244 Ala. 281, 13 So.2d 179 (1943). Waiver, on the other hand, is the voluntary and intentional surrender or relinquishment of a known right. See O’Neal v. O’Neal, 284 Ala. 661, 227 So.2d 430 (1969); State Farm Mutual Automo bile Ins. Co. v. Hubbard, 272 Ala. 181, 129 So.2d 669 (1961).

The “inconsistent position” alleged by Key to have been taken by Brunson in the prior proceeding was as follows: In Brunson’s motion to have himself dismissed as a defendant in the Smith complaint, he alleged as grounds, among other things, “that he has no interest in this matter as is evidenced by his” quitclaim deed to Dominex. Further, in his letter brief filed in support of his motion, Brun-son stated that “he no longer has an interest in this controversy and evidence that fact by the quitclaim deed.” But, later, apparently realizing that an issue existed as to the effectiveness of this quitclaim deed to transfer a statutory right of redemption, Dominex and Brunson, by amendment, sought to include and confirm that James Brunson was a party plaintiff to Dominex’s complaint. The final judgment granted Brunson’s motion to dismiss and Key’s motion to strike this amendment.

From the foregoing, we conclude that, at the time Brunson assumed the position of “no interest,” he did not have knowledge of the fact that the quitclaim was ineffective to transfer the only interest he could have had at that time — the statutory right of redemption. Furthermore, his failure to assert that right, resulting from ignorance of the fact that he had not conveyed that right, does not constitute estoppel if he commences his remedial action with promptness after becoming acquainted with the facts. Ivey v. Dixon Investment Co., 283 Ala. 590, 219 So.2d 639 (1969); Nelson Realty Co. v. Darling Shop of Birmingham, 267 Ala. 301, 101 So.2d 78 (1958). This rationale was explained in Le-Furgey v. Beck, 244 Ala. 281, 13 So.2d 179 (1943), where estoppel is based on prior proceedings:

“Inconsistent positions in different liti-gations, where the party failed of benefit from the former position, through mistake of fact, or mistake as to rights of property in certain cases, does not ordinarily estop the party from asserting the true facts. This is quite different, in principle, from setting up a fraudulent claim on simulated facts, burdening the other party with long delay in the enjoyment of property rights, admittedly his in that proceeding, but for the fraudulent claim asserted, and the burden of protracted litigation to defeat the fraudulent claim, to be followed by suit in equity founded on another and conflicting state of facts, all known to complainant from the beginning.” (Emphasis added.) 244 Ala. at 284, 13 So.2d 179.

Furthermore, in view of Brunson’s apparent mistake as to the effectiveness of his deed and his attempt to assert his own right to redeem by joining the prior lawsuit, we cannot conclude that Brunson voluntarily and intentionally relinquished (waived) a known right. Consequently, we hold that nothing in the prior lawsuit operates as an estoppel or waiver by Brunson of his statutory right to redeem and his subsequent right to transfer to Dominex.

C.

Next, we address the issues involving James Brunson’s post-foreclosure and post-redemption rights and their assignability.

As previously stated, James Brunson in 1978 jointly acquired the subject 15 acres with his first wife Marie by a deed which contained a right of survivorship clause. The Brunsons’ divorce decree, however, did not in any way dispose of or even address the question of jointly owned property. Key contends that the Brunsons’ divorce destroyed the relationship giving rise to the joint ownership. This contention is clearly contrary to the settled law in this state. In Summerlin v. Bowden, 286 Ala. 391, 240 So.2d 356 (1970), this Court recognized the rule that a divorce decree which is silent with respect to property held jointly with a right of survivorship does not automatically destroy the estate. Accord, Watford v. Hale, 410 So.2d 885 (Ala.1982). Also, in Coffelt v. Coffelt, 390 So.2d 652 (Ala.Civ.App.1980), the Court of Civil Appeals, on similar facts, held that where the divorce decree does not mention jointly owned land each party retains the same right, title, claim, or interest therein which they were granted by the conveyance to them. The court there explained:

“When the trial judge did not alter ownership, that, in and of itself, disposed of the issue. In a divorce action, there is no requirement that the joint ownership of property by the parties be abolished and that title be vested in only one spouse. In such cases, an equitable and open division of jointly-owned property might well be no division thereof with the title to that particular property being left undisturbed by the judgment.” 390 So.2d at 653.

Therefore, the Brunsons’ interest in the property remained unchanged by the divorce. Furthermore, finding as we have that the prior judgment implicitly held the Brunson-Smith warranty deed invalid, we conclude that James Brunson and Marie Brunson Cole continued as joint tenants until the property was sold to the Smiths at the foreclosure sale by the mortgagee bank, such sale destroying their joint tenancy. See Reed v. Dunn, 392 So.2d 1173 (Ala.1981).

Yet, in each arose a post-foreclosure statutory right to redeem the property under § 6-5-230, supra. Marie Brunson Cole validly assigned her statutory right to redeem the entire property to Albert Key, who redeemed from the Smiths following summary judgment in his favor in the prior actions. James Brunson, on the other hand, made an invalid transfer of his right to Dominex (via a quitclaim deed), and it was not until after Key had redeemed that Brunson sought to execute a corrective transfer of his post-redemption rights.

Clearly, under the rule stated in Salter v. Odom, 240 Ala. 462, 199 So. 687 (1940), and followed in Reed v. Dunn, supra, upon Key’s redemption, title vested in Key subject to the inchoate right of James Brunson to rehabilitate his interest as a co-tenant by contributing within a reasonable time to the purchase price paid by Key:

“In this jurisdiction it is established, by a long line of decisions, that a redemption of property by one cotenant from mortgage, or tax sales, or a purchase before the time of redemption has expired, and the discharge of other liens, will inure to the benefit of all the coten-ants, who may, within a reasonable time, elect to avail themselves of the redemption, or of the purchase, by making, or offering to make, their proportionate contribution to the redemption of said property, or its purchase, with interest thereon. [Citations omitted.]” (Emphasis added.) 240 Ala. at 464, 199 So. at 688.

See also Chastang v. Washington Lumber and Turpentine Co., 267 Ala. 390, 102 So.2d 899 (1958), holding that a joint owner or tenant in common who redeems from a tax sale is generally said to act for the benefit of all joint owners, if such right is seasonably exercised.

Under the joint title with survivor-ship held by James Brunson and Marie Brunson Cole before foreclosure, neither party could convey the entire property. Each owned a one-half interest in the property while, at the same time, each owned the whole. A pre-foreclosure conveyance by either of his or her one-half interest would have destroyed the joint tenancy and created a new tenancy in common, with the grantee owning a one-half interest as tenant in common with the non-conveying joint tenant, thereby destroying the survivorship interest. See generally, Nunn v. Keith, 289 Ala. 518, 268 So.2d 792 (1972).

The same principles of co-tenancy ownership apply to post-foreclosure assignments of the right to redeem. Once a co-tenant or his assignee redeems, the title is restored, with legal title vesting in all of the co-tenants. Braly v. Polhill, 231 Ala. 633, 166 So. 419 (1936). We are not persuaded that, merely because Key was the assignee of a cotenant’s (Marie Brun-son Cole’s) statutory right to redeem, his redemption of the property operated to destroy James Brunson’s inchoate right as a co-tenant to contribute. Such reasoning would sanction a “race of diligence” between cotenants to redeem the property after foreclosure, and thus create a vehicle by which one co-tenant would be permitted to act with respect to the property to the prejudice of the other, contrary to settled principles of law regarding cotenancy and joint ownership:

“ ‘A tenant in common has the right to relieve the common property from a lien or encumbrance, and may make a valid tender of payment of the whole mortgage debt on behalf of his cotenants, and acts of this nature done in relation to the general interest in the whole common property are presumed to have been done bona fide for the common benefit, and generally a purchase by a cotenant of an outstanding title being presumed to be for the benefit of all parties in interest is not void, passing title subject to the rights of other eotenants. But one tenant in common will not be permitted to inequitably acquire title to the common property, solely for his own benefit or to the exclusion of his cotenants, the general rule being that the purchase or extin-guishment of an outstanding title to, encumbrance upon, or claim against the common property by one tenant in common inures to the benefit of all the co-owners, who may within a reasonable time elect to avail themselves of the benefit of the purchase of the outstanding interest or conflicting claim or the removal of the emcumbrance from the common property.’ ” Gilb v. O’Neill, 225 Ala. 92, 95-96, 142 So. 397, 400 (1932).

Accord, Taylor v. Jones, 280 Ala. 329, 194 So.2d 80 (1967).

Key further argues that even if Brunson had the inchoate right to contribute, that right is not assignable. Further, if such right is assignable, the instrument under which Dominex now claims was an ineffective transfer of that right because it was entitled a “Transfer of Right of Redemption.” We disagree.

First, the case of Braly v. Polhill, supra, resolves in favor of Dominex the issue of whether an inchoate right to contribute is assignable. In that case, at the time of foreclosure in 1933, the property was jointly owned by T.C. Eubank, who owned a five-eighths interest therein; Kate Eubank, one-eighth; Rebecca E. Taylor, one-eighth; William D. and Martha A. Eubank, each one-sixteenth. When the mortgagee bank foreclosed, it sold the property to Stout at the foreclosure sale, and in May 1934, Stout conveyed to Polhill. Six months later, Kate Eubank and Dixie Yearwood (who had no right whatsoever in the property) statutorily redeemed the property from Polhill and conveyed the same to Braly. Sometime after that, T.C. Eubank and Rebecca E. Taylor granted to Polhill their right to contribute their proportionate share toward the redemption. Then Polhill brought suit against Braly to allow her to redeem these shares from him. In upholding Polhill’s “right to contribute the due proportion of her grantors of the outlay by the grantors of [Braly] in redeeming the property and a rehabilitation of her title,” the court held:

“Where in the circumstances a deed is essential to perfect the redemption and deed is made to the co-tenant or party redeeming, the legal title vests in the redemptioner in trust and the equitable title in all the cotenants. [Citations omitted.]
“The right thus acquired, not being a mere right of action, but title, is the subject of bargain and sale_” (Emphasis added.) 231 Ala. at 635, 166 So. at 421.

Thus, the court in Braly recognized that, unlike the statutory right of redemption, a co-tenant’s right to contribute his proportionate share of the redemption is more than a mere right of action; legal title having been restored by redemption, the non-redeeming co-tenant’s interest ripens into an equitable title, and is, therefore, conveyable.

Finally, more important than the lable given the instrument under which Dominex claims is the actual granting language contained therein:

“I, JAMES E. BRUNSON, herein joined by my wife, Terri S. Brunson, do hereby remise, release, quit claim, transfer, sell and convey to the said DOMINEX, INC., my statutory right of redemption together with all other related rights of redemption or any right whatsoever in and to that certain property ....”

This granting language clearly reflects an intention on the part of James Brunson to convey to Dominex any and all of his interest in the property, in the same manner as a normal quitclaim deed. Beyond this, in view of the quitclaim deed executed prior to Key’s redemption, it is possible the doctrine of after-acquired title, discussed supra, would operate to vest Brunson’s equitable title in Dominex.

For the reasons stated, the judgment of the circuit court is due to be, and it hereby is, reversed and the cause remanded for entry of judgment consistent with this opinion.

REVERSED AND REMANDED.

All the Justices concur.

      . The following quotation from Wright & Miller does recognize some authority for converting a Rule 12(f) motion to strike an insufficient defense into one for summary judgment:
      "[T]he 1948 amendments to Rule 12 expressly authorized the conversion of Rule 12(b)(6) and Rule 12(c) motions into summary judgment motions but did not include a comparable provision for Rule 12(f) motions to strike an insufficient defense ....
      "If matters outside the pleadings were freely presented and considered, motions under Rule 12(f), especially those testing the legal sufficiency of a defense, might be transformed into motions testing the factual or evidentia-ry, as well as the legal, basis for the challenged pleading and would serve much the same function as a motion for summary judgment. Even though Rule 12(f) probably was not intended to serve this function, it is difficult to distinguish the role of the motion to strike an insufficient defense from that of the Rule 12(b)(6) and Rule 12(c) motions in terms of the desirability of permitting their conversion into summary judgment motions. Consequently, the absence of a conversion provision in Rule 12(f) covering challenges to insufficient defenses makes little sense and probably is the result of a happenstance of timing — the conversion provisions in Rules 12(b)(6) and 12(c) were inserted at the same time the motion to strike an insufficient defense was formally recognized and the possibility of extending the practice to the latter context may have been overlooked. Thus, it is not surprising that some courts, when faced with affidavits on a Rule 12(f) motion to strike a defense have treated the motion to strike as one for partial summary judgment.” (Footnote omitted. Emphasis added.) 5 Wright & Miller, Federal Practice and Procedure, § 1380 at 789.
      Nevertheless, we have found no authority for treating the grant of a motion to strike an amendment adding a party plaintiff to the complaint as a judgment on the pleadings under Rule 12(c) or as a partial summary judgment. Nor does it appear from Key’s motion to strike that "matters outside the pleadings were freely presented and considered,” with the exception of legal conclusions drawn by Key in his motion.
      “All well-pleaded facts are taken as admitted on a motion to strike, but conclusions of law or fact do not have to be treated in that fashion. Matter outside the pleadings normally is not considered on a Rule 12(f) mo-tion_” (Footnotes omitted.) Id. at 787-788

      . We make this assumption because these legal principles of redemption were strongly argued in detailed briefs submitted to the trial court by counsel for Key in support of Key’s motion directed to this issue, all of which are made part of the record on this appeal.

      . Although the Smiths named Brunson as a party defendant, claiming that Brunson (and therefore Dominex) was estopped from asserting any redemptive rights because of the warranty deed executed by Brunson prior to foreclosure, the Court dismissed Brunson as a defendant in the Smith complaint. Moreover, a determination of the invalidity of this warranty deed is implicit in the final judgment. See the discussion ante in Part III (B).


source: Caselaw Access Project

author: FAULKNER, Justice.

license: Public Domain

text:
    The CITY OF CENTREVILLE v. Johnnie WHITE and Bobby Deason.
    83-671.
    Supreme Court of Alabama.
    Aug. 31, 1984.
    Michael L. Murphy, Centreville, for appellant.
    Douglas McElvy of Ford, McElvy & Ford, Centreville, for appellees.
   FAULKNER, Justice.

This is an appeal by the City of Centre-ville from a final judgment vacating a portion of Fourth Avenue North in Centreville, Alabama. We affirm.

On December 2, 1966, a subdivision plat entitled “Country Club Estates” was filed and recorded in the probate office of Bibb County, Alabama. White and Deason are the present owners of all of the property abutting an isolated portion of a dead-end street designated as Fourth Avenue North. The portion of the street vacated is 400 feet long and constitutes all of Fourth Avenue North east of Second Street North. (See appendix.)

White and Deason initially filed with the city council a declaration to vacate the portion of Fourth Avenue North which is abutted on all sides by their commonly owned property. When their request was denied, they filed suit in the Bibb County Circuit Court pursuant to Alabama Code (1975), § 35-2-58. They alleged that as sole abutting property owners they were entitled to vacation of the street since it has never been made into a through street and since it dead ends into their abutting property.

The following facts were orally stipulated to at trial:

1. That Fourth Avenue North is an officially dedicated street up to the point where the street dead ends at Lot 4. (The White and Deason Lot.)
2. That a revised map of the City of Centreville was recorded in 1968. This map shows an extension of Fourth Avenue North through Lot 4 eventually joining another street in existence, Goodwin Avenue.
3. That the extension of Fourth Avenue North shown on the 1968 map was never officially dedicated.
4. That White and Deason were the sole abutting owners of the property surrounding the portion they sought to have vacated.
5. That White is the owner of Lots 2 and 3, and the north part of Lot 4, and Deason is the owner of Lots 5 and 6, and the southern portion of Lot 4.

Based upon the evidence presented, and the stipulations of fact, the court granted the plaintiffs’ petition to vacate. In rendering final judgment, the Court, inter alia, set out the following findings:

(a) that the scheme of the subdivision for the vacated portion of Fourth Avenue North was to provide access only for the property of the appellees, not to provide any mode of ingress or egress to the other owners in the subdivision;
(b) that the right of ingress and egress of the nonabutting property owners will not be affected in any way by the vacation of the street;
(c) that the interest of the other owners of property in the subdivision or of the City is too remote to be of any consequence in the vacation of the street; and
(d) that the street does not provide any access to natural resources or private recreational facilities.

The City of Centreville’s motion for a new trial was denied and it appeals.

The City contends that the trial court did not properly take into consideration the interests of non-abutting property owners in the subdivision. Specifically, the City argues that the above findings of the court were arbitrary and based on conjecture and thus should fail for lack of evidentiary support.

We disagree with the City’s contentions and affirm the circuit court’s judgment.

The instant case was brought under Alabama Code (1975), § 35-2-58, which provides: “The circuit courts of this state shall have jurisdiction and power to vacate ... any streets, ... upon the filing of a civil action by any person or persons owning any of the lots, parcels or tracts of land abutting such roads, streets or alleys sought to be vacated.” The rights of attin-gent property owners are the same under § 35-2-54, when vacation is sought through a municipal agency. Gwin v. Bristol Steel & Iron Works, Inc., 366 So.2d 692 (Ala.1978). Section 35-2-54 provides in part that “convenient means of ingress and egress to their property shall be afforded to all other property owners owning property in the tract of land embraced in the map, plat, or survey....”

Sections 35-2-54 and 35-2-58 and the case law interpreting these vacation statutes provide broad protection for the interests of property owners who may not own property abutting the portion of the street sought to be vacated, subject only to a rule of remoteness. Jackson v. Moody, 431 So.2d 509 (Ala.1983); Booth v. Montrose Cemetery Association, 387 So.2d 774 (Ala.1980); Gwin v. Bristol Steel & Iron Works, Inc., 366 So.2d 692 (Ala.1978).

In Booth, supra, this Court held:

“Case law in this State reflects that the statute authorizing a platted street to be vacated by ‘the owner or owners of the lands abutting the street,’ is interpreted to protect the interests of other property owners in the subdivision, who may not necessarily own property abutting the street or portions thereof sought to be vacated. Every purchaser of a lot shown on the recorded map of the subdivision has the right, as against the dedicator of the streets, and the purchasers of the other lots, to have the designated scheme of public thoroughfares maintained in its integrity, as it existed when he purchased the property, and all persons whosoever may use these public ways as the occasion requires.”

387 So.2d at 776-77.

In determining whether the non-abutting property owners have an interest in this case, the designated scheme of public thoroughfares is evidenced by reference to the recorded subdivision plat. In its current condition, the portion of Fourth Avenue North which plaintiffs seek to have vacated cannot provide ingress or egress to any property owner other than plaintiffs White and Deason. Nor, in this case, would the vacation of the isolated portion of Fourth Avenue North deprive other landowners of the use and enjoyment of their property. According to the recorded plat, the portion of Fourth Avenue North in question is a dead end street, contiguous with the plaintiffs’ property. There is not now, nor has there ever been, a public thoroughfare through Lot 4.

We fail to see how the non-abutting property owners could possibly be affected by the vacation of the property. The City has neither hypothesized exactly what rights it seeks to protect, nor pointed out how non-abutting property owners might be affected by vacation of this parcel.

The City apparently argues that it may, in the future, extend Fourth Avenue North in accordance with the revised City map, in which case the landowners in the subdivision would have an interest to be protected. We, however, are not persuaded by the City’s argument. The proposed extension of Fourth Avenue North would be through Lot 4. It is undisputed, based on the parties’ stipulation, that there was never an official dedication of this property for an extension. The fact that the extension of Fourth Avenue North is drawn on the revised city map does not constitute a legal dedication of the property in favor of the City. Because there has been no official dedication of the plaintiffs’ property for the extension, the public has no vested right to the extension of Fourth Avenue North until such time as the property is either purchased or opened as a street. See Arnett v. City of Mobile, 449 So.2d 1222 (Ala.1984).

We conclude that the trial court properly considered the scheme of the subdivision as represented by the recorded plat and correctly found that the interests of other property owners in the subdivision were too remote. The judgment, of the trial court is affirmed.

AFFIRMED.

TORBERT, C.J., and ALMON, EMBRY and ADAMS, JJ., concur.

APPENDIX


author: ADAMS, Justice.

text:
    Gregory FINLEY v. LIBERTY MUTUAL INSURANCE COMPANY.
    82-952.
    Supreme Court of Alabama.
    Sept. 7, 1984.

      Mitchell G. Lattof, Jr. of Diamond, Lat-tof, Gardner & Flynn, Mobile, for appellant.
    William H. Hardie, Jr. and M. Margaret O’Brien of Johnstone, Adams, May, Howard & Hill, Mobile, for appellee.
   ADAMS, Justice.

This is an appeal from the Mobile County Circuit Court’s order granting summary judgment in favor of defendant Liberty Mutual Insurance Company (Liberty Mutual) and against plaintiff Gregory Finley.

The facts of this case are as follows:

On January 3, 1982, Gregory Finley was injured while working as an employee of Courtaulds North America, Inc. (Cour-taulds). Finley’s right hand was caught in an unguarded conveyor belt, resulting in the partial amputation of several fingers. He was released by his physician to return to work on March 8, 1982. Thereafter, without representation of counsel, Finley negotiated a settlement of his workmen’s compensation claim with Liberty Mutual, the compensation carrier for Courtaulds.

Liberty Mutual contacted its local Mobile attorney, Benjamen Rowe, in order to effectuate the settlement. Rowe was to prepare the settlement document and obtain court approval of the lump sum settlement. The settlement contained a release which included the following language:

That upon payment of said $3,852.22 and after obtaining the approval of the Court, said employer and its insurance carrier shall without further formality stand forever released and discharged for any and all claims arising out of or in any way connected with the above-described accident, injuries, and/or disability and/or the treatment thereof, and/or any resulting or related reduced earning capacity, all irrespective of the extent in fact of any such injuries and/or past, present, and/or future disability, and/or reduced earning capacity to said employee, except that the employer will pay for future medical treatment directly and necessarily related to the treatment of injuries described above.
That this settlement contains the entire agreement between the parties hereto, and the said employer and its insurance carrier do not and have not assumed any obligation of any kind to said employee except as expressly stated herein. [Emphasis added.]

The settlement was submitted to the circuit court, and on April 6 was approved in an order stating:

The Court, ...
ORDERS, ADJUDGES, and DECREES that the agreement and petition be and the same hereby is approved by this Court, that the parties hereto are in all respects ordered to conform thereto, and that when the lump sum payment provided for in the agreement and petition has been made, the employer and its insurer shall be forever released and discharged from any and all claims in any way connected with this matter except that the employer shall pay future medical expenses as more particularly set out in the agreement and petition. [Emphasis added.]

The lump sum payment required in the settlement has been paid in full by Liberty Mutual.

Several months after the settlement was signed, Finley, at this time represented by counsel, filed a .third-party claim against Liberty Mutual alleging, among other things, negligent inspection of Finley’s work area. On February 17, 1983, Liberty Mutual filed a motion for summary judgment, taking the position that the above-quoted language of the settlement agreement released it from liability for negligence with regard to Finley’s injury. Liberty Mutual supported its motion with an affidavit of Rowe. On March 15, the court, without a hearing on the motion, granted Liberty Mutual’s motion for summary judgment. Finley filed a motion to reconsider on March 24, 1983. The motion was supported by Finley’s affidavit, which was dated March 10. This affidavit was filed May 13. On May 30, 1983, following a hearing, the motion was denied.

The issues presented for our review are:

1. Is the language of the settlement and release ambiguous, rendering it inapplicable to Liberty Mutual’s third-party liability for negligence?
2. Was there evidence of lack of mutual assent of the parties, raising a question of fact to defeat a motion for summary judgment?
3. Was there evidence of fraud, presenting an issue of fact for the jury?
4. Was there evidence of a lack of consideration for the release of third-party liability of Liberty Mutual?

There is not even a scintilla of evidence to support Finley regarding any of these issues; therefore the judgment of the trial court is due to be affirmed.

I.

Appellant Finley argues that the language of the settlement and release is ambiguous, and, therefore, that the jury should have been allowed to decide what the intent of the parties was at the time the document was executed. The general rule with respect to releases, as stated in Miles v. Barrett, 223 Ala. 293, 134 So. 661 (1931), is that

in the absence of fraud, a release supported by a valuable consideration, unambiguous in meaning, will be given effect according to the intention of the parties to be judged by the court from what appears within the four corners of the instrument itself, and parol evidence is not admissible to impeach it or vary its terms. Barbour v. Poncelor, 203 Ala. 386, 83 So. 130; Wright v. McCord, 205 Ala. 122, 88 So. 150; Gravlee v. Lamkin, 120 Ala. 210, 24 So. 756.

The language found to be unambiguous in Miles was: “in full and complete settlement of any and all claims ... on account of such injuries.... ” This language is very similar to that in the instant case which released Courtaulds and Liberty Mutual from “any and all claims arising out of or in any way connected with the above-described accident....” We are unable from the facts of this case to find any reason that would justify a departure from the holding in Miles that the phrase “any and all claims” means precisely what it says, and, therefore, is unambiguous.

II.

Finley next contends that there was a lack of mutual assent of the parties in signing the settlement. According to the Restatement (Second) of Contracts § 152 (1981):

(1) Where a mistake of both parties at the time the contract was made as to a basic assumption on which the contract is made has a material effect on the agreed exchange of performances, the contract is voidable by the adversely affected party unless he bears the risk of the mistake under the rule stated in § 154.
(2) In determining whether the mistake has a material effect on the agreed exchange of performances, account is taken of any relief by way of reformation, restitution, or otherwise.

It is clear from the language quoted above that there must be a mutual misunderstanding concerning a basic assumption on which the contract was made. There is not even a scintilla of evidence in the pleadings and affidavits to suggest a mistaken belief on the part of both Finley and Liberty Mutual. The settlement states that, in exchange for $3,852.22, Finley releases Courtaulds and Liberty Mutual from all claims against them by Finley, which includes the third-party claim that Finley asserted against Liberty Mutual. The fact that a third-party claim was not specifically contemplated by the parties is of no consequence.

Finley maintains that at no time did he intend to release Liberty Mutual, or any other party, from third-party liability. A mistake solely on Finley’s part, however, is not enough to invalidate the release.

If the agreement describes the subject-matter, and does not admit of two meanings, the fact that one of the parties by mistake thought that it was something else does not prevent a binding contract. [Citations omitted.]

Southern Ry. Co. v. Birmingham Rail & Locomotive Co., 210 Ala. 540, 541, 98 So. 727, 728 (1924).

Finley was unable to proffer any evidence of a lack of mutual assent by himself and Liberty Mutual. Thus, the grant of Liberty Mutual’s motion for summary judgment by the trial court was correct.

III.

Although Finley alleges fraud, there is no evidence whatsoever that Liberty Mutual defrauded him. To the contrary, Finley’s affidavit makes no mention of any representations made to him by Courtaulds or Liberty Mutual. BenjamenRowe, Liberty Mutual’s attorney, stated that he “had no discussions with Mr. Finley regarding the terms of the settlement or what was intended to be settled beyond having him read and approve of the settlement documents themselves prior to his signing them.” In Miles, supra, this court, when faced with facts substantially similar to those here, found no evidence of fraud upon the claimant, who read the settlement and was familiar with its contents before signing.

IV.

Finally, Finley alleges that the release was not supported by sufficient consideration, or that the consideration was invalid. Regarding the former, he argues that the amount of money he received is not equal to the amount of money he should have been paid after sustaining such an injury. Finley’s argument is not supported in law. The issue of “equality in value” is discussed in Marcrum v. Embry, 291 Ala. 400, 282 So.2d 49 (1973), which states:

The rule is too well settled, even to admit of argument, that consideration in fact bargained for is not required to be adequate in the sense of equality in value. Corbin on Contracts, § 127. The mere inadequacy, alone, is never sufficient to vitiate a contract or conveyance otherwise valid, and the courts are not disposed to enter upon nice calculations to strike a balance on the one side or the other. Norrell v. Thompson, 252 Ala. 603, 42 So.2d 461, 462. Absolute equality is not to be hoped for, and is seldom attained in men’s dealings one with the other. Nor is consideration to be measured in terms of dollars and cents alone; convenience, avoidance of troublesome details and efforts are proper elements. Decker v. Decker, 253 Ala. 345, 44 So.2d 435.

291 Ala. at 406, 282 So.2d at 54.

Finley’s contention that the consideration for signing the release was invalid is also without merit. Liberty Mutual’s payment to Finley was a lump sum payment, and where lump sum payments are made in lieu of weekly compensation payments, the agreement of the parties is required. United States Steel Corp. v. Baker, 266 Ala. 538, 97 So.2d 899 (1957). By agreeing to make a lump sum payment instead of weekly payments, Liberty Mutual was agreeing to perform something that it was not required by law to perform— which has been consistently construed by this court to be valid consideration.

We are unable to find even a scintilla of evidence supporting Finley’s contentions; therefore, for this and all of the above-stated reasons, the judgment of the trial court is affirmed.

AFFIRMED.

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


author: SHORES, Justice.

text:
    CHRYSLER CREDIT CORPORATION v. Jimmy McKINNEY, et al.
    82-786.
    Supreme Court of Alabama.
    Sept. 21, 1984.
    R. Bruce Hall of Conaway & Hall, Do-than, W.B. Hairston, Jr. of Engel, Hair-ston, Moses & Johanson, Birmingham, for appellant.
    Alan C. Livingston of Lee & Mclnish, Dothan, for appellees.
    Cathy S. Wright and Deborah J. Long of Maynard, Cooper, Frierson & Gale, Birmingham, for amicus curiae AmSouth Bank, N.A.
   On Application for Rehearing

SHORES, Justice.

The application for rehearing is granted, the original opinion is withdrawn, and the following opinion is substituted therefor.

Defendant Chrysler Credit Corporation appealed from a judgment entered against it and in favor of the plaintiffs in the amount of $20,000. We reverse and remand.

The case arose from the following facts:

In July 1980, Jimmy McKinney bought a Dodge Mirada from Countywide Dodge for his wife’s use. He negotiated and executed on behalf of McKinney Ceramic Tile Co., Inc., of which he was president and majority stockholder, a retail installment contract financing the automobile with Chrysler Credit Corporation. McKinney made only two payments pursuant to this agreement.

McKinney returned the car to Countywide Dodge on numerous occasions for repairs. The dealership successfully repaired most of the defects, but never repaired a leak in the roof of the automobile. The leak was so bad that at times, after a rainshower, two inches of water was left standing in the front floor. Because of this repeated leaking, the car’s interior had an offensive odor, and the leather interior was damaged.

Mr. McKinney visited the dealership time after time and, at one point in September, explained the problem to the owner of Countywide Dodge, who assured him it would be repaired. It was not. He then wrote letters to the dealership, Chrysler Corporation, and Chrysler Credit Corporation, notifying them that he would make no more payments on the vehicle until the leak was repaired. He received no responses to these letters. Chrysler Credit later telephoned him about his failure to make the payments on the vehicle. Once again, he discussed the leak in the roof and was assured that it would be repaired. Soon thereafter, James Smith, a repossession agent of Chrysler Credit, contacted Mrs. McKinney about the car and the McKin-neys’ failure to make the payments on the note. Mrs. McKinney met Smith at a restaurant to discuss the matter. After a conversation, wherein Mrs. McKinney detailed to Smith the problem with the car, she and Smith reached an agreement. Mrs. McKinney testified as follows concerning the agreement:

“He [Smith] told me that everything was fine, that all he had to do was to get met to take the car in to the lot and it would be fixed. You know, they would fix the leak in it. And, if they fixed the leak in it, then we would bring up the payment, which I agreed to.”

Mrs. McKinney called their attorney from the restaurant. He spoke with Smith and confirmed the agreement not to repossess the car unless and until the McKinneys failed to bring the payments up to date following the repair of the vehicle’s roof.

Mrs. McKinney and Smith then left the restaurant and drove to the dealership, where Mrs. McKinney surrendered the automobile to the dealership for repairs. The owner of the dealership confirmed the agreement to catch up the past due payments when the car was repaired.

A few days later, Chrysler Credit sent repossession notices to the McKinneys, advising them that the automobile had been repossessed and would be sold within five days after the receipt of those notices. The attorney for the McKinneys corresponded with Chrysler Credit, informing them of the agreement that repossession would not occur unless the repairs were made and the payments were not then brought up to date. Chrysler Credit did not respond to this letter.

The day after the repossession took place, Chrysler Credit called upon Countywide Dodge to pay off the McKinney account, pursuant to its recourse agreement, which it did.

Following these events, Countywide again made numerous attempts to repair the leaking roof in the car. Several times Mr. McKinney went into the dealership and, each time,- the roof leaked when tested. Later, Mr. McKinney was told to remove his personal belongings from the vehicle because it was no longer his car and was being sold. Thereupon Mr. McKinney filed suit against Chrysler Credit, Chrysler Corporation, and Countywide Dodge.

The trial court granted Countywide’s motion for directed verdict at the close of the plaintiffs’ case. The jury returned a verdict against Chrysler Corporation and in favor of the plaintiffs for breach of warranty. That verdict is not an issue in this appeal. The jury also returned a verdict against Chrysler Credit Corporation for $20,000.00 on a conversion claim. Only Chrysler Credit appealed.

Chrysler Credit contends the trial court erred in several particulars, but because we are convinced that a new trial is required because a disqualified juror participated in the trial, we do not address other claimed errors.

On voir dire concerning their qualifications, the trial judge asked the prospective jurors if any of them were unable to read and write. There was no response to the question. Following the trial, it came to the attention of counsel for Chrysler Credit that one of the jurors could neither read nor write and had failed to respond to the question concerning literacy during the voir dire examination by the trial judge. Chrysler Credit filed a motion for new trial, contending that the juror’s illiteracy disqualified him from service, and that Chrysler Credit had, therefore, been denied the right to a trial by twelve qualified jurors and was entitled to a new trial. A hearing was held, and the juror was questioned. During this hearing, it was discovered that the juror also had a hearing impairment, which Chrysler Credit contends further hindered him in his ability to properly comprehend the procedures at the trial. After the hearing, the trial court denied the motion for a new trial. This appeal followed.

Section 12-16-60, Ala.Code 1975, sets forth the following qualifications for jurors. It reads:

“(a) A prospective juror is qualified to serve on a jury if the juror is generally reputed to be honest and intelligent and is esteemed in the community for integrity, good character and sound judgment and also:
“(1) Is a citizen of the United States, has been a resident of the county for more than 12 months and is over the age of 19 years;
“(2) Is able to read, speak, understand and follow instructions given by a judge in the English language;
“(3) Is capable by reason of physical and mental ability to render satisfactory jury service, and is not afflicted with any permanent disease or physical weakness whereby the juror is unfit to discharge the duties of a juror;
“(4) Has not lost the right to vote by conviction for any offense involving moral turpitude.”

Chrysler Credit claims that the foregoing statute makes the ability to read and write an indispensable prerequisite to jury service, and that if an illiterate juror serves on a jury, a new trial must be granted. We agree that a new trial is required where, as here, the prospective jury venire was specifically asked whether each member could read and write the English language and indicated by silence that each could.

We have held that the statutory prerequisite to jury service requiring the absence of any conviction of an offense involving moral turpitude is an absolute, and that such a conviction is an automatic disqualification from jury service where the juror was asked that question and failed to respond. In Beasley v. State, 39 Ala.App. 182, 96 So.2d 693 (1957), we held that the failure of a prospective juror to answer truthfully when asked the question concerning the conviction of a crime required a new trial. In Beasley, the prospective jur- or had been previously convicted of adultery. He was silent when the question concerning the conviction of a crime was asked by the trial judge, and he served on the jury. This Court held that this prior conviction was both a disqualification and a common law ground for challenge for cause. Thus, the trial court’s denial of the motion for new trial based on such a disqualification was error.

We need not decide under the facts in this case whether a new trial must automatically be granted when it is shown after judgment that a juror served who was disqualified under the statute. We do, however, hold that a new trial is mandated where a juror serves who has failed to respond to a specific question based upon a statutory disqualification.

The appellees’ reliance upon Freeman v. Hall, 286 Ala. 161, 238 So.2d 330 (1970), and Martin v. Mansell, 357 So.2d 964 (Ala.1978), is misplaced. Those cases involved the failure of a juror to respond to questions asked by counsel on voir dire which were designed to aid a lawyer in his peremptory challenges under Title 7, § 52, Code of Alabama (now Rule 47, Alabama Rules of Civil Procedure). Those cases do not involve matters which disqualify a jur- or and thereby render him or her subject to challenge for cause. In such a case, we have left it to the trial court to determine whether or not the failure to respond was so prejudicial as to require a new trial.

We are convinced that Chrysler Credit was entitled to a new trial when it proved that the juror was asked whether he could read and write and failed to respond and, particularly so, when it was also shown that his hearing was impaired. The transcripts of the hearing on the motion for new trial contain evidence that the juror in question did not have the capacity to understand all the evidence in the ease. It is not disputed that he could neither read nor write, and several times during the course of the hearing, the juror could not hear the questions posed to him, and they had to be repeated. There were numerous items of documentary evidence submitted at trial. Much of this evidence was explained during the testimony at trial, but the juror’s hearing impairment might have deprived him of the benefit of that testimony. Chrysler Credit “should not be subjected to the peril of having a juror put upon [it] who is disqualified to sit as a juror in the case.” Carter v. Beasley, 285 Ala. 9, 15, 228 So.2d 770, 776 (1969), quoting Morris v. McClellan, 169 Ala. 90, 97, 53 So. 155, 156 (1910). We, therefore, hold that the trial court erred in denying the new trial. We reverse and remand the cause for a new trial.

APPLICATION GRANTED; ORIGINAL OPINION WITHDRAWN; OPINION SUBSTITUTED; REVERSED AND REMANDED.

MADDOX, FAULKNER, JONES, EM-BRY, BEATTY and ADAMS, JJ., concur.


author: MADDOX, Justice.

text:
    John B. JOHNSON, James A. King, Jr., James T. Parsons, J. Hardie Meade, Jr. v. JAGERMOORE-ESTES PROPERTIES, a partnership, et al.
    83-145.
    Supreme Court of Alabama.
    Sept. 21, 1984.
    Donald H. Brockway, Jr. of Corretti & Newsom, Birmingham, for appellants.
    J. Fred Wood, Jr., Carleton P. Ketcham, Jr., and J. Terry McElheny of Dominick, Fletcher, Yeilding, Wood & Lloyd, Birmingham, for appellees.
   MADDOX, Justice.

This is a suit seeking rescission of an option contract for the purchase of certain improved realty, including 342 apartment units.

On February 27, 1980, James T. Parsons, John B. Johnson, James A. King, Jr., and Hardie Meade, Jr. (purchasers) entered into an agreement with Jagermoore-Estes Properties and others (sellers) which provided in pertinent part as follows:

“OPTION AGREEMENT
“In consideration of the sum of $100,-000.00 the receipt of which is hereby acknowledged, we Jagermoore-Estes Properties, a partnership; Hale and Associates, a partnership; Glenn F. Till and Ellis H. Till, Jr. (hereinafter optionors); hereby give and grant to the undersigned optionees the option and privilege of purchasing for the full purchase price of $3,400,000.00, the real estate, 342 apartment units, described in Exhibit ‘A’ attached hereto and made a part hereof. The individual parcels of real estate are owned by the individual optionors as described on Exhibit ‘A’. The optioned property includes all improvements, shrubbery, plantings, fixtures, appliances, and appurtenances, now existing or subsequently installed, in or upon the subject real estate.
“The optionees have the right to exercise this option of purchase at any time within nine (9) months from the date hereof and the optionors agree to execute to the optionees a general warranty deed in form sufficient to pass full fee simple title to the property described herein, with the exception of easements and restrictions of record, and assuming the existing mortgages.
“Optionors and their managing agent(s) shall use their best effort to keep all units rented during the term of this option, up to and including the date of closing.
“Optionors warrant that customary repairs and maintenance shall continue on a sound, prudent, businesslike basis, and shall permit no waste to occur to the subject real estate during the term of this option, including extensions.
“Optionors at optionors’ expense, shall within sixty (60) days after closing place any units unrentable at time of closing in good rentable condition as determined by all parties, or if all parties cannot agree, the final decision will be determined by an Inspector from the Section 8 Division of the Housing Authority of the City of Birmingham.
“Optionors warrant that they have not received any notification from any governmental agency of any pending public improvements, or requiring any repairs, replacements, or alterations to the property that have not been satisfactorily made or will be made at optionors’ expense. Optionors are not aware of anything nor have they withheld any information that would have a material effect on the value. Optionors shall make these same warrants as of the date of closing.
“Optionors shall make every effort to deliver the warranties, title, and documents specified herein, and to live up to each and every obligation in this agreement. If unable to do so, they shall promptly refund the $100,000.00 option fee and any extension fees.”

On or about November 1, 1980, purchasers sent sellers the following letter.

“Re: Option Agreement dated February 27, 1980
“Gentlemen:
“In a recent inspection of the apartment complex which is the subject of the above captioned Option Agreement, it was noted to our dismay that the apartment complex is in a very poor state of repair. At the time the Option Agreement was entered into, you assured us that you would spend $100,000.00 for the repair, maintenance and renovation of the apartment complex. This has not been done. “Also, you represented to us that you would place ten (10) to twelve (12) additional apartment units into the Section 8 Program. This you have also failed to do.
“You represented that after the repairs and necessary maintenance was performed and the new units placed into the Section 8 Program, it would enhance the value of the property by $1,000,000.00. “Since the repairs, maintenance and renovation have not been performed, as per the Option Agreement, and you have failed to place the additional units into the Section 8 Program, the apartment complex and the property on which same is situated has been reduced in value by a substantial amount.
“You also agreed to use your best efforts during the option term to keep all apartment units rented. This you have also failed to do.
“In view of your failure to comply with the terms and provisions of the Option Agreement and also in view of the many misrepresentations which you made to us at and prior to the time the Option Agreement was executed, we hereby advise you that we consider the Option Agreement null and void and in no force and effect.
“We, therefore, request that you return to us the $100,000.00 which we heretofore deposited with you as option money.”
On November 7, 1980, sellers responded: “Gentlemen:
“We received your letter in reference to option agreement dated February 27, 1980 and as you are aware we don’t know what you are talking about.
“We will be prepared to close on November 27, 1980 as agreed.”

On November 25, 1980, purchasers brought suit in Jefferson County Circuit Court, seeking rescission of the contract and damages based on fraud and breach of contract. In particular, purchasers alleged that the agreement obligated sellers to use their “best efforts” to keep all units rented and repaired during the option term and that sellers had failed to do so, and had allowed the property to fall into further disrepair. Purchasers, subsequently, withdrew their claim for damages.

On September 12, 1983, the case was tried ore tenus in the circuit court, without a jury, and on October 13, 1983, judgment was rendered in favor of the sellers. That judgment provided in pertinent part:

“The Court, having heard and considered all the evidence and observed the demeanor of each of the witnesses, finds that there was no such misrepresentation or fraud in the inducement; and the Court is further of the opinion that the relief sought by the plaintiffs is due to be denied.
“The Court observed that all plaintiffs who testified are astute businessmen and well acquainted with real estate matters of this type. While the evidence is undisputed that there was a certain amount of deterioration of certain apartments in the complex which is the subject of this option due to vandalism, it is equally undisputed that there was deterioration of the same type at the time the option was executed and that the plaintiffs were aware of same before signing the option agreement. Additionally, it is undisputed that defendants spent a greater sum of money on maintenance of the apartment complex during the option period than they did during the same time frame immediately preceding the option period.
“The central provision of the option as it relates to the basic complaints of the plaintiffs is that provision which provides that defendants would have sixty days after a closing of the sale pursuant to the option agreement in which to make the repairs necessary to put all the apartments in rentable condition. There was no evidence presented to the Court that the apartments could not have been put in rentable condition by defendants within the sixty-day period if they had been given the opportunity to do so.
“While plaintiffs did offer evidence of alleged breaches by defendants, the Court specifically finds that no alleged breach on which evidence was offered would have been a substantial and fundamental breach so as to justify rescission of the option. Alabama Football, Inc. v. Stabler, 294 Ala. 551, 319 So.2d 678 (1975). The Court finds it significant that at no time during the option period was a complaint made or notice given by plaintiffs to defendants of any alleged failure of defendants to perform, thereby giving them a reasonable time in which to do so. Bienville Mortgage Corp. v. Mayo, 286 Ala. 675, 245 So.2d 819 (1971).”

Purchasers appeal here, asserting that the trial court erred in failing to grant rescission and order a return of their $100,-000 deposit. We find no reversible error, and affirm.

Although we agree with the general propositions of law advanced by the purchasers, that a material falsehood constituting fraud may justify rescission, Stone v. Walker, 201 Ala. 130, 77 So. 554 (1917), and that a material breach of contract may do likewise, Alabama Football, Inc. v. Stabler, 294 Ala. 551, 319 So.2d 678 (1975), purchasers’ brief does little else than rear-gue the facts as presented to the trial court. That court specifically found that there was neither a material breach nor the perpetration of a fraud.

It is well-settled that the question of whether fraud or a breach of contract has occurred is to be determined by the trier of fact, John Deere Industrial Equipment Co. v. Keller, 431 So.2d 1155 (Ala.1983), and that where, as here, the trial court sits as the trier of fact, its findings are entitled to a presumption of correctness and will be disturbed on appeal only if palpably wrong, unsupported by the evidence, or manifestly unjust. General Electric Credit Corp. v. Strickland Division of Rebel Lumber Co., 437 So.2d 1240 (Ala.1983).

The record before us is lengthy, and, while we believe a detailed recitation of the evidence will neither serve the cause of justice nor aid in disposition of this case, we believe that there was sufficient evidence presented to support the findings and conclusions of the trial court. Briefly, the evidence shows that the purchasers are, indeed, businessmen who have experience in real estate speculation; two are realtors, one is a mortgage banker, and the other is a contractor. The evidence indicates that they agreed to purchase only after long negotiations; that they had an opportunity to inspect the apartments several times prior to executing the contract, and that they knew the apartments to be low rent units, in various states of disrepair, and subject to both vandalism and vacancy. They also understood that as much as $200,000 in capital would be needed to make repairs, and there is evidence, although disputed, indicating that they knew that their $100,000 deposit would not be used for this purpose. There is also evidence that the sellers spent a considerable sum on repairs and maintenance during the term of the option, and that they intended to make complete repairs after closing, using the $3,400,000 purchase price as capital. It is undisputed that by the terms of the agreement, they had sixty days after closing in which to accomplish this task.

While purchasers contend that a material part of the contract was that additional units were required to be improved so as to meet federal “section eight housing standards,” we note that nowhere in the agreement is that intent expressed.

Considering the foregoing evidence, along with the wording of the contract, we find that the decision of the trial court was supported by the evidence and was neither palpably wrong nor manifestly unjust.

AFFIRMED.

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

      . While it is true that the purchasers' letter to the sellers also mentioned the section eight requirements, we believe that the terms of the agreement control and that the trial court could have found, as it apparently did, that the reference in the letter was no more than a self-serving statement, which it could, within its discretion, disregard.


text:
    JOHN LLOYD & CO., INC.; John Lloyd; and Alan J. Murray v. Arthur J. STRINGER.
    83-152.
    Supreme Court of Alabama.
    Sept. 21, 1984.
    Thomas B. Huie of Huie, Fernambucq & Stewart, Birmingham, for appellants.
    Gilbert E. Johnston, Jr. and David K. Tinkler of Johnston, Barton, Proctor, Swed-law & Naff, Birmingham, for appellee.
   ADAMS, Justice.

This is an appeal from the Jefferson County Circuit Court’s grant of a preliminary injunction in favor of Arthur Stringer and against John Lloyd and Company, Inc., and its two stockholders, John Lloyd and Alan J. Murray.

The case arose out of the following facts:

John Lloyd & Company, Inc. (Lloyd & Co.) is a corporation engaged in the insurance business as an excess and surplus lines broker. The corporation does business in foreign markets, primarily London, England, insuring difficult or unusual risks referred to it by various agents. Arthur J. Stringer left England to join Lloyd & Co. in Mountain Brook as a vice-president in 1967. Prior to 1981, however, Stringer did not have a written contract of employment with Lloyd & Co.

On October 27, 1981, Stringer entered into two contracts with Lloyd & Co. as part of a comprehensive plan to transfer ownership of the business from its president, John Lloyd, to Stringer and Alan J. Murray. Stringer and Murray bought stock in Lloyd & Co. for an amount less than fair market value, in exchange for their executing employment contracts containing covenants not to compete. The covenant included the period of employment and one year following termination, and forbade Stringer from engaging in the insurance business in Alabama.

In February 1983, Lloyd decided to change a portion of Lloyd & Co.’s business from a firm it had been doing business with to another firm. Stringer was already in disagreement with Lloyd concerning release of the company’s balance sheets to prospective customers, and when he was informed that Lloyd changed firms without consulting him, Stringer felt he would not be able to continue working for Lloyd. Consequently, Stringer told Lloyd that he thought it best that he leave Lloyd & Co.

Stringer informed Lloyd that he had a possibility of employment with the insurance firm of McGriff & Seibels, but that no offer had been made to him. Aware of the problems that were present with Lloyd & Co., McGriff & Seibels offered to purchase Lloyd & Co. Any sale to McGriff & Seibels would have been conditioned on the surrender by Stringer and Murray of their Lloyd & Co. stock. Stringer and Murray, who owned 49% of the stock in Lloyd & Co., rejected McGriff’s offer. At this point, Stringer told Lloyd that he hoped to return his stock and have all his agreements with Lloyd cancelled, once Lloyd had hired and trained a suitable replacement. On April 1, 1983, Lloyd hired Jim Bain as vice-president, and Bain began working one month later.

In May 1983, Stringer sought to have a document prepared to transfer his shares back to the company. He employed the same attorney who drew up the original agreements between Stringer and Lloyd & Co. The “Withdrawal from Stock Redemption Agreement and Resignation as Director” agreement provided, in part, that:

[Although [Stringer] is continuing his employment with the Corporation, [he] nevertheless desires to (a) transfer his twenty-nine (29) shares of stock of the Corporation to the Corporation in return for $580.00, (b) withdraw as a party to the Stock Redemption Agreement dated October 27, 1981, made by and among the parties hereto, and (c) resign as a director of the Corporation.

On June 2, 1983, Stringer executed this document in the presence of Lloyd and Murray. Stringer asked Lloyd if there was anything else that needed to be done, or anything else that needed to be signed. Although Lloyd claims he just answered “no,” both Murray and Stringer agree that Lloyd responded: “[I]f there is, we can take care of it later.”

Stringer continued to work for Lloyd & Co. throughout the summer. On September 6, 1983, Lloyd asked Stringer about his plans for other employment. Over the next couple of days, Stringer spoke with several persons in the business about possible job openings, and each asked Stringer whether his current employment contract contained a covenant not to compete. On September 9, Stringer told Lloyd about these conversations, and informed Lloyd that he assured the persons he contacted that the covenant would be cancelled when he left Lloyd & Co. Lloyd, however, stated that the covenant not to compete would be enforced even after Stringer left the company.

A few days passed, and Stringer reiterated to Lloyd his belief that they had reached an understanding earlier in the year that all agreements between the two would be cancelled, including the covenant not to compete. Lloyd maintained that the covenant would be enforced, which forced Stringer to remain with Lloyd & Co. Stringer notified Lloyd by letter dated September 18, 1983, that as long as there was any question concerning the enforcement of the covenant not to compete, he could not afford to leave; and thus intended to remain a diligent and faithful employee of Lloyd & Co. Despite this assurance of continued loyalty, at the end of September 1983, Lloyd terminated Stringer’s employment.

Stringer filed a complaint to enjoin Lloyd from attempting to enforce the covenant not to compete in his employment contract. Stringer also applied for a preliminary injunction. Lloyd & Co. appeals from the trial court’s issuance of the preliminary injunction, which restrains Lloyd & Co. from attempting to enforce the covenant not to compete.

The dispositive issue for our review is whether the trial court abused its discretion in issuing the preliminary injunction.

Alabama courts follow the rule that the trial court’s grant of a preliminary injunction will not be disturbed on appeal, absent a gross abuse of discretion. Alabama Education Association v. Board of Trustees, 374 So.2d 258 (Ala.1979). The result of this abuse must be of a type that would constitute a manifest injustice unless corrected on appeal. Id. Such abuse of discretion is not present in this case; therefore, the judgment of the trial court is due to be affirmed.

Over the years this court has developed a test by which trial courts can review applications for temporary relief. In Double C. Productions, Inc. v. Exposition Enterprises, 404 So.2d 52 (Ala.1981), we set forth the requirements that must be met when a preliminary injunction is sought:

1. “... if [the trial judge] finds that the party has presented a fair question as to the existence of the right to be protected, and further finds that temporary interference to preserve the status quo is convenient and expedient, then he may exercise his discretion and grant the injunction.” (Citation omitted.)
2. “... An injunction should not be granted unless it is necessary to prevent irreparable injury.” (Citation omitted.)
3. “Injunctions ... will not be granted merely to allay apprehension of injury; the injury must be both imminent and irreparable in a court of law.” (Citations omitted.)

404 So.2d 52, 54 (Ala.1981).

Inherent in the use of this tripartite standard, either by the trial court or the reviewing court, is the implementation of a balancing process, whereby the court weighs the relative hardships that either party may suffer against any benefits which might flow from the grant of the preliminary injunction.

Stringer has satisfied the first prong of the three-pronged test by showing the existence of a right to be protected; namely, the right to continued employment in the insurance business in Alabama. After his termination by Lloyd, Stringer was without a job, and, but for the issuance of the injunction, would have been without much hope of finding one in his field. The preliminary injunction was necessary to allow Stringer any chance at procuring employment in the insurance business without having to relocate. Also, the trial court did not burden Lloyd & Co. with any measurable detriment by issuing the injunction. Thus, the benefit to Stringer greatly outweighs the harm, if any, to Lloyd & Co.

We also agree with the trial court that Stringer’s injury is both imminent and irreparable in a court of law, thus satisfying the remaining requirement set forth in Double C. Productions, Inc., supra, for the issuance of a preliminary injunction. Stringer would not be able to find a job if the covenant not to compete were enforced. He was financially unable to risk the costs of starting his own business, which prompted him to inform Lloyd in writing of his intentions to stay with Lloyd & Co. Soon thereafter, however, he was fired. Unless the trial court fashioned some type of relief, Stringer, to gain employment in his field, would have to leave his home in Alabama. Alternatively, he could remain in Alabama, but be forced to accept some other kind of job outside his profession.

Stringer applied for equitable relief. He was willing to relinquish all rights he had in the management of Lloyd & Co., in return for a release from the contract. The evidence is uncontroverted that Stringer sold his shares of stock back to Lloyd & Co., at far less than market value. This he did in exchange for Lloyd’s promise that the covenant not to compete would not be enforced against him.

Lloyd seeks the best of both worlds. He argues that the comprehensive plan entered into by Stringer is invalid, thus allowing him to fire Stringer; but at the same time the plan is valid, so that the covenant not to compete can be enforced. To so hold would effectively allow Lloyd to be unjustly enriched. On the other hand, upholding the preliminary decision of the trial court does justice for both parties — -Lloyd & Co. retains the shares of stock sold to it by Stringer at a price far less than they command on the open market, and Stringer is able to seek employment, unhindered by the covenant not to compete.

This ease is different from the majority of cases involving covenants not to compete, as here the validity of the covenant itself is not questioned, just its enforcement. The trial court found that Stringer had bargained with Lloyd for his release from all agreements, including the covenant not to compete. We find no error by the trial court which would require reversal.

For all of the above-stated reasons, the trial court’s order granting a preliminary injunction is affirmed.

AFFIRMED.

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