author: SHAW, Justice.

text:
    Charles H. STEPHENS and Stephens Properties, Inc. v. FINES RECYCLING, INC., et al.
    1091111.
    Supreme Court of Alabama.
    Nov. 10, 2011.

      Bruce F. Rogers and John W. Clark IV of Bainbridge, Mims, Rogers & Smith, LLP, Birmingham; and B. Clark Carpenter, Jr., of Thornton, Carpenter, O’Brien, Lazenby & Lawrence, Talladega, for appellants.
    Donald W. Stewart of Stewart & Stewart, P.C., Anniston; and John L. Lawler, Mobile, for appellees.
   SHAW, Justice.

Charles H. Stephens and Stephens Properties, Inc., the defendants/counterclaim plaintiffs below, appeal from a judgment entered on a jury verdict in favor of Fines Recycling, Inc. (“Fines”); Harry Donaldson, Jr.; Gerry Hamby; Hal Isbell; and Donald G. Wilson (collectively “the Fines shareholders”), the plaintiffs/counterclaim defendants below, on claims stemming from a dispute over a commercial lease. We dismiss the appeal as being from a nonfinal judgment.

Facts and Procedural History

Stephens Properties, Inc., is an Alabama corporation that leased commercial rental property in Talladega; Charles H. Stephens is the president of Stephens Properties. At all times pertinent to this dispute, Fines, also an Alabama corporation, was involved in the business of salvaging scrap metal from the automobile-shredding process. In May 1996, Stephens Properties and Fines, Inc., Fines’s predecessor in interest, entered into a lease agreement pursuant to which Fines, Inc., leased approximately six acres of real property in Talladega for use in its metal-reclamation business.

With regard to that lease agreement and the resulting business relations of the parties, and as reflected in the record, “the following facts [were] established by admission in the pleadings or by stipulation of counsel”:

“e. On or about the 10th day of May, 1996, Finest, Inc.,] and Stephens Properties executed a lease of certain lands located in Talladega Gounty, Alabama. ...
“f. Finest, Inc.,] operated a recycling business on property belonging to Stephens Propertiest;] Finest, Inc.,] ordered truckloads of auto dirt and auto fluff (material from auto shredders) sent to it for a screening process to screen out metals which could be sold to foundries and other businesses. The material remaining after reclamation was a byproduct of this business. Finest, Inc.,] developed this soil-product for use as landfill cover.
“g. Finest, Inc.,] attempted to have this byproduct classified by the Alabama Department of Environmental Management, hereinafter referred to as ‘ADEM,’ as ‘fill’ or ‘cover’ rather than waste. ADEM originally accepted the classification with certain conditions, but in 1998 changed [its] position and stated that the auto dirt and byproduct was waste which must be removed and disposed of in a landfill.
“h. Finest, Inc.,] applied for and received a landfill permit from ADEM to construct a landfill nearby on other property owned by Stephens Properties. The initial permit was to allow Finest, Inc.,] to construct a landfill to dump the waste from its metal reclaiming business .... Finest, Inc.,] did not construct the landfill.
“i. In 1999, Finest, Inc.,] entered into a transaction with a company named WCA of Alabama, LLC, hereinafter referred to as ‘WCA of Alabama,’ whereby Finest, Inc.,] would sell it’s [sic] landfill permit to WCA of Alabama so that WCA of Alabama could construct and operate a landfill. This transaction was effectuated by selling the stock of Finest, Inc.,] to WCA of Alabama, then transferring all assets, rights and obligations of Fines, [Inc.,] except for the permit, to another company named Fines Recycling, Inc, hereinafter referred to as ‘Fines Recycling.’ ...
“j. On or about the 80th day of June, 1999 the assets of Finest, Inc.,] were transferred to Fines Recycling, including the lease agreement between Finest, Inc.,] and Stephens Properties. Fines Recycling continued to operate its recycling operation on, and otherwise used and occupied, property belonging to Stephens Properties.
“k. As part of the sale to WCA of Alabama, the [Fines shareholders], Donaldson, Hamby, Isbell and Wilson, each received shares of stock in Waste Corporation of America, Inc., hereinafter referred to as ‘WCA of America.’ WCA of America went public in June, 2004 and new stock certificates were issued by WCA of America.
“1. In March of 1999 ADEM sent a notice of violation alleging that Fines Recycling had an unauthorized solid waste dump on the property and demanded that it cease the unauthorized disposal and move the waste to a permitted solid waste disposal facility.[]
“p. Isbell pledged his individually owned WCA of America stock to Stephens Properties as security for the obligation of Fines Recycling to clean up the property and for rent until current.
“q. Hamby, Donaldson[,] and Wilson pledged their individually owned WCA of America stock to Stephens Properties as security for the clean up of the property but deny that they pledged their stock for rent owed by Fines Recycling to Stephens Properties.
“r. Hamby, Wilson[,] and Donaldson delivered possession of their WCA of America stock certificates to [Charles] Stephens and Stephens Properties.
“s. Because Isbell had lost his WCA of America stock certificate, Isbell executed a written agreement with Stephens Properties pledging 12,823 shares of stock as security for clean up and rent until current.
“t. In September or October, 2001, Fines Recycling moved its operations to Birmingham. At that time, auto fluff and material resulting from the operations of Fines Recycling was left on the property owned by Stephens Properties.
“u. In 2002 Fines Recycling permanently went out of business.
“v. The property owned by Stephens Properties was ultimately cleaned up and the fluff and material resulting from the operations of Fines Recycling was removed from the property.”

Following completion of the environmental cleanup, however, Stephens Properties and/or Stephens allegedly failed to return the stock certificates pledged as security by the Fines shareholders.

Fines and the Fines shareholders subsequently filed the underlying action against Stephens Properties and Stephens, which, following several amendments, ultimately sought compensatory and punitive damages related to claims of breach of contract, fraudulent misrepresentation, conversion of the pledged stock certificates, and conversion of a 1990 Case brand loading tractor (“the Case loader”). Stephens Properties and Stephens answered, and Stephens Properties filed several counterclaims. Following several amendments, Stephens Properties’ counterclaims ultimately sought the following relief: a declaratory judgment as to the rights, liabilities, and obligations of the parties with respect to the lease of the property, the cleanup process necessitated by environmental violations on the property as identified by the Alabama Department of Environmental Management (“ADEM”), and the pledged stock certificates; judicial foreclosure of the pledged stock certificates; and money damages associated with Fines’s purported breach of the lease agreement by allegedly failing to pay rent after February 2000 and for damage to the rental premises. Stephens Properties also alleged misrepresentation and sought to pierce the corporate veil and to impose personal liability on the Fines shareholders for any judgment entered against Fines.

The case proceeded to a jury trial on the following six claims: Fines and the Fines shareholders’ claim that Stephens Properties and/or Stephens converted the Case loader; the Fines shareholders’ claim that Stephens Properties and/or Stephens converted the stock certificates of Donaldson, Hamby, and Wilson; the Fines shareholders’ breach-of-contract action based on Stephens Properties’ and/or Stephens’s alleged failure to return the pledged stock certificates as agreed by the parties; Stephens Properties’ counterclaim seeking past-due rent; Stephens Properties’ counterclaim seeking damages for the cost of repairs for damage under the lease; and Stephens Properties’ counterclaim seeking damages for additional costs and damage to the leased premises.

The jury found as follows:
• That Stephens Properties and Stephens converted the Case loader and awarded $17,000 in compensatory damages and $40,000 in punitive damages to Fines as to that claim;
• That Hamby, Wilson, and Donaldson did not pledge their stock certificates to Stephens Properties to secure payment of past-due rent (but only as security for the promise of environmental cleanup);
• That Stephens, individually, converted Donaldson’s pledged stock certificate and awarded $29,000 in compensatory damages and $50,000 in punitive damages;
• That Stephens, individually, converted Wilson’s pledged stock certificate and awarded $29,000 in compensatory damages and $50,000 in punitive damages;
• That Stephens, individually, converted Hamby’s pledged stock certificate and awarded $100,855 in compensatory damages and $180,000 in punitive damages;
• That Fines breached the lease agreement and awarded Stephens Properties $439,410 in past-due rent; and
• That $89,760 of the past-due rent figure is subject to the stock certificate that Isbell pledged as security to Stephens Properties for past-due rent.

Thus, the jury awarded Fines $57,000 in damages against Stephens Properties and Stephens and awarded Stephens Properties $439,410 in damages against Fines. Stephens was found liable for a total of $438,855 to be paid to Hamby, Wilson, and Donaldson.

On November 30, 2009, the trial court entered a judgment on the foregoing verdict. In its judgment, the trial court noted:

“Prior to commencement of the jury trial, the Court and the attorneys of record agreed that the equitable issues of piercing the corporate veil and foreclosure of stock would be severed and tried non-jury. The Court will be required to schedule a hearing on the equitable issue of piercing the corporate veil and the equitable issue of foreclosing [the] stock owned by ... Isbell that was pledged for rent due by Fines ... to Stephens Properties ... as determined by one of the verdicts.
“This case involves multiple claims by the parties. The Court allowed the parties to litigate the jury issues and there remains equitable and/or non-jury issues pending before the Court. It would be inequitable to decide the issue of piercing the corporate veil and the disposition of collateral pledged by ... Isbell to Stephens Properties ... until such time as this order is made final and any potential appeal or appeals have been fully adjudicated. It is the intent of the Court to enter an order directing the entry of a final judgment as to all verdicts rendered by the jury in this cause and make an express determination that there is no just reason for delay and direct the entry of judgments hereinbe-low in accordance with Rule 54 of the Alabama Rules of Civil Procedure.”

In accordance with its expressed intention, the trial court purported to certify its judgment as final pursuant to Rule 54(b), Ala. R. Civ. P., on grounds that there was no just reason for delay. Stephens Properties and Stephens subsequently filed a motion seeking a judgment as a matter of law or, in the alternative, relief from the judgment and/or a new trial, which the trial court denied. They also filed a separate motion seeking to vacate the trial court’s certification of the judgment as final pursuant to Rule 54(b). The trial court likewise denied that motion, as well as a Rule 60(b), Ala. R. Civ. P., motion filed by Fines and the Fines shareholders seeking to vacate the portion of the trial court’s judgment awarding a judicial lien on Is-bell’s stock certificate.

Subsequently, the trial court amended its judgment and purported “to further provide for additional Rule 54(b) language as set out herein for the purpose of supplementing prior grounds for the entry of a final judgment.” Specifically, it noted:

“The need for the [Rule] 54(b) certification is more evident now due to the necessity of allowing counsel for [Fines and the Fines shareholders] to pursue, if they choose to do so, an appeal of this Court’s denial of the Rule 60(b) motion. In the event of an appeal, the trial court needs the appellate courts to resolve all of the claims previously adjudicated and rulings by this Court prior to the trial court proceeding with the equitable issues of piercing the corporate veil and foreclosure of stock to satisfy a portion of a monetary judgment rendered in favor of Stephens ... and against Fines....”

Stephens Properties and Stephens (collectively “the appellants”) timely appealed; Fines and the Fines shareholders, however, did not appeal the breach-of-contract judgment or the denial of their Rule 60(b) motion.

Discussion

In addition to challenging the trial court’s denial of their motions seeking a judgment as a matter of law as to the conversion of the Case loader and the pledged stock certificates and its decision to submit the issue of punitive damages to the jury, the appellants argue that the trial court’s Rule 54(b) certification was erroneous in light of the relationship between the adjudicated claims and the still pending claims. Specifically, they contend that this Court lacks jurisdiction to entertain the present appeal because, they say, the equitable counterclaims asserted by Stephens Properties, which remain pending in the trial court, are “intertwined” with the legal claims decided by the jury. See Allen v. Briggs, 60 So.3d 899, 904 (Ala.Civ.App.2010) (“[I]f a Rule 54(b) certification is determined to have been improperly entered, the judgment so certified is considered to be nonfinal and therefore unable to support an appeal.” (citing Dzwonkowski v. Sonitrol of Mobile, Inc., 892 So.2d 354, 361 (Ala.2004))). In a related argument, the appellants assert that, in purporting to “sever” the equitable claims from the legal claims, the trial court also exceeded its discretion. As to both arguments, we agree.

I. Severance Versus Separate Trials

Initially, the appellants maintain that, although the trial court’s order refers to the equitable issues presented by Stephens Properties’ counterclaim as having been “severed” from the legal claims of the parties (terminology that Fines and the Fines shareholders repeat in their brief to this Court), in actuality, there was no formal severance of those claims pursuant to Rule 21, Ala. R. Civ. P. Instead, they argue, the equitable claims were merely separated from the legal, jury claims, as permitted by Rule 42, Ala. R. Civ. P., for purposes of trial. Contrary to that position, Fines and the Fines shareholders contend that the remaining claims “were severed under Rule 21 [, Ala. R. Civ. P.,]” and “are to be tried in a separate action.” The record does not support Fines and the Fines shareholders’ contention.

As has been frequently observed, the distinction between the terms “severed” and “separated for trial” is an important one and one that often gives rise to confusion for both courts and litigants. Harper Sales Co. v. Brown, Stagner, Richardson, Inc., 742 So.2d 190 (Ala.Civ.App.1999). See also New Acton Coal Mining Co. v. Woods, 49 So.3d 181, 185 (Ala.2010) (“ ‘Confusion has sometimes arisen between a true severance and an order providing for separate trials pursuant to Rule 42(b).’ ” (quoting Committee Comments Adopted February 13, 2004, to Rule 21, Ala. R. Civ. P.)), and Opinion of the Clerk No. 54, 982 So.2d 1059, 1061 (Ala.2007) (observing that “‘[l]awyers and judges tend to use the terms [“severance” and “separate” trials] interchangeably, speaking of “severance” when all that is intended is a separate trial.’ ” (quoting Opinion of the Clerk No. 45, 526 So.2d 584, 586 (Ala.1988))).

“Although the trial court used the word ‘sever’ in ordering the separate trials of the claims, there is a clear distinction between severing claims and ordering separate trials on claims.
“ ‘ “ ‘Rule 42(b)[, Ala. R. Civ. P.,] allows the court to order a separate trial of any claim, cross-claim, counterclaim, or third-party claim, or of any separate issue or of any number of claims or issues. The court may do so in furtherance of convenience or to avoid prejudice, or when separate trials will be conducive to expedition and economy. The procedure authorized by Rule 42(b) should be distinguished from severance under Rule 21 [, Ala. R. Civ. P.]. Separate trials will usually result in one judgment, but severed claims become entirely independent actions to be tried, and judgment entered thereon, independently. Unfortunately this distinction, clear enough in theory, is often obscured in practice since at times the courts talk of “separate trial” and “severance” interchangeably.’ (Footnotes omitted.)
“ ‘ “Federal Practice and Procedure: Civil § 2387 (1971).” ’
“Ex parte Palughi, 494 So.2d 404, 406 (Ala.1986) (quoting Key v. Robert M. Duke Ins. Agency, 340 So.2d 781, 783 (Ala.1976)); Opinion of the Clerk No. 45, 526 So.2d 584 (Ala.1988) (concluding that when a claim is severed pursuant to Rule 21, Ala. R. Civ. P., a separate filing fee should be paid on that separate action). Further, the label assigned by the parties or by the trial court is not determinative; ‘“[t]he substance of the court’s action, not its form, controls.” ’ Ex parte Palughi, 494 So.2d at 406 (quoting Key v. Robert M. Duke Ins. Agency, 340 So.2d at 783).”

Morgungenko v. Dwayne's Body Shop, 23 So.3d 671, 673-74 (Ala.Civ.App.2009). See also Woods, 49 So.3d at 184-85 (“A significant distinction exists between an order separating trials under Rule 42(b) and one severing claims under Rule 21 because ‘severed claims become independent actions with judgments entered independently, while separate trials lead to one judgment.’ ” (quoting Universal Underwriters Ins. Co. v. East Cent. Alabama Ford-Mercury, Inc., 574 So.2d 716, 725 (Ala.1990))).

Here, the trial court’s pretrial order indicated that the equitable, nonjury counterclaims would be “addressed by the court in a post jury trial setting.” See supra note 2. Its judgment incorporating the jury verdict, however, stated that those claims “would be severed and tried non-jury.” Although the trial court used the word “sever,” we note the absence in the record on appeal of any motion seeking to sever the equitable counterclaims pursuant to Rule 21 and the absence of any reference by the trial court to that rule. Finally, had a true severance actually occurred, the entry of a Rule 54(b) certification would have been unnecessary. See Key v. Robert M. Duke Ins. Agency, 340 So.2d 781, 783 (Ala.1976) (noting that Rule 54(b) “applies to actions in which ‘separate trials’ are ordered pursuant to Rule 42(b)” but “does not apply ... to claims ‘severed’ from the original action”), and Tucker Motor Co. v. Davenport, 396 So.2d 101, 103 (Ala.Civ.App.1980) (finding that conclusion that trial court ordered separate trials but not a severance under Rule 21 was “buttressed by the action of the circuit court in clearly making the judgment final as is authorized by Rule 54(b).... ”).

Based on the actions of the trial court as reflected in the record, we conclude, as the appellants urge, that the trial court merely meant to order separate trials of the legal issues and the equitable issues. Thus, notwithstanding the trial court’s conclusion in the November 30, 2009, judgment that it had “severed” the equitable counterclaims, the substance of the trial court’s action was to order separate trials pursuant to Rule 42 in order to accommodate the presence of both jury and nonjury issues. Accordingly, we conclude that the trial court did not order a severance of the equitable counterclaims pursuant to Rule 21 but, rather, simply ordered separate trials of those claims pursuant to Rule 42(b). See Certain Underwriters at Lloyd’s, London v. Southern Natural Gas Co., 939 So.2d 21, 27 (Ala.2006).

II. Rule 51(b) Certification

Because, as determined above, the trial court directed separate trials of the legal and equitable claims, the trial court’s judgment, entered in response to the jury verdict determining the legal claims, was not a final judgment unless the trial court’s Rule 54(b) certification is valid. See, e.g., Woods, 49 So.3d at 185; Harper Sales, 742 So.2d at 192; and Bryant v. Flagstar Enters,, Inc., 717 So.2d 400, 402 (Ala.Civ.App.1998). “The purpose of Rule 54(b) ... is to make final ‘an order which does not adjudicate the entire case but as to which there is no just reason for delay in the attachment of finality.’ ” Ex parte James, 836 So.2d 813, 852 (Ala.2002) (Moore, C.J., concurring in the result in part and dissenting in part) (quoting Foster v. Greer & Sons, Inc., 446 So.2d 605, 609 (Ala.1984), overruled on other grounds, Ex parte Andrews, 520 So.2d 507 (Ala.1987)). However, “ ‘[n]ot every order has the requisite element of finality that can trigger the operation of Rule 54(b).’ ” Dzwonkowski, 892 So.2d at 361 (quoting Goldome Credit Corp. v. Player, 869 So.2d 1146, 1147 (Ala.Civ.App.2003) (emphasis omitted)).

“‘Rule 54(b) certifications “should be made only in exceptional cases.” ’ ” Posey v. Mollohan, 991 So.2d 253, 258-59 (Ala.Civ.App.2008) (quoting Wallace v. Tee Jays Mfg. Co., 689 So.2d 210, 212 (Ala.Civ.App.1997)).

“Rule 54(b) provides, in part:
“ ‘When more than one claim for relief is presented in an action, whether as a claim, counterclaim, cross-claim, or third-party claim, or when multiple parties are involved, the court may direct the entry of a final judgment as to one or more but fewer than all of the claims or parties only upon an express determination that there is no just reason for delay and upon an express direction for the entry of judgment.’
“This Court recently explained the appropriate standard for reviewing Rule 54(b) certifications, stating:
“ ‘ “If a trial court certifies a judgment as final pursuant to Rule 54(b), an appeal will generally lie from that judgment.” Baugus v. City of Florence, 968 So.2d 529, 531 (Ala.2007).
“ ‘Although the order made the basis of the Rule 54(b) certification disposes of the entire claim against [the defendant in this case], thus satisfying the requirements of Rule 54(b) dealing with eligibility for consideration as a final judgment, there remains the additional requirement that there be no just reason for delay. A trial court’s conclusion to that effect is subject to review by this Court to determine whether the trial court exceeded its discretion in so concluding.’
“Centennial Assocs. v. Guthrie, 20 So.3d 1277, 1279 (Ala.2009). Reviewing the trial court’s finding in Schlarb v. Lee, 955 So.2d 418, 419-20 (Ala.2006), that there was no just reason for delay, this Court [has] explained that certifications under Rule 54(b) are disfavored[.]
“In considering whether a trial court has exceeded its discretion in determining that there is no just reason for delay in entering a judgment, this Court has considered whether ‘the issues in the claim being certified and a claim that will remain pending in the trial court “ ‘are so closely intertwined that separate adjudication would pose an unreasonable risk of inconsistent results.”” Schlarb, 955 So.2d at 419-20 (quoting Clarke-Mobile Counties Gas Dist. v. Prior Energy Corp., 834 So.2d 88, 95 (Ala.2002), quoting in turn Branch v. SouthTrust Bank of Dothan, N.A., 514 So.2d 1373, 1374 (Ala.1987), and concluding that conversion and fraud claims were too intertwined with a pending breach-of-contract claim for Rule 54(b) certification when the propositions on which the appellant relied to support the claims were identical). See also Centennial Assocs., 20 So.3d at 1281 (concluding that claims against an attorney certified as final under Rule 54(b) were too closely intertwined with pending claims against other defendants when the pending claims required ‘resolution of the same issue’ as issue pending on appeal); and Howard v. Allstate Ins. Co., 9 So.3d 1213, 1215 (Ala.2008) (concluding that the judgments on the claims against certain of the defendants had been improperly certified as final under Rule 54(b) because the pending claims against the remaining defendants depended upon the resolution of common issues).
“... In MCI Constructors, LLC v. City of Greensboro, 610 F.3d 849[, 855] (4th Cir.2010), the United States Court of Appeals for the Fourth Circuit explained:

“ ‘In determining whether there is no just reason for delay in the entry of judgment, factors the district court should consider, if applicable, include:

“ ‘ “(1) the relationship between the adjudicated and unadjudicated claims; (2) the possibility that the need for review might or might not be mooted by future developments in the district court; (3) the possibility that the reviewing court might be obliged to consider the same issue a second time; (4) the presence or absence of a claim or counterclaim which could result in a set-off against the judgment sought to be made final; (5) miscellaneous factors such as delay, economic and solvency considerations, shortening the time of trial, frivolity of competing claims, expense, and the like.”
‘Braswell [Shipyards, Inc. v. Beazer E, Inc.], 2 F.3d [1331,] 1335-36 [(4th Cir.1993) ] ... (quoting Allis-Chalmers Corp. v. Phila. Elec. Co., 521 F.2d 360, 364 (3d Cir.1975) [overruled on other grounds by Curtiss-Wright Corp. v. Gen. Elec. Co., 446 U.S. 1 (1980)]).’ ”

Lighting Fair, Inc. v. Rosenberg, 63 So.3d 1256, 1263-64 (Ala.2010) (footnotes and emphasis omitted). Of those five factors relevant to a Rule 54(b) inquiry, the appellants argue that three of the factors mandate a vacation of the certification in the present case: the relationship between the adjudicated and unadjudicated issues, the existence of a potential setoff, and the effect of an immediate appeal on the parties.

A. Whether Stephens Properties’ Breach-of-Contract Claim Has Been Completely Adjudicated

Initially, the appellants contend that Rule 54(b) certification was inappropriate because, they say, the remaining equitable “claims” are not, in fact, separate claims, but “are actually remedies for the adjudicated legal claims.” As support for this contention, the appellants rely on this Court’s decision in Ex parte Thorn, 788 So.2d 140 (Ala.2000), in which we held that “the piercing-the-corporate-veil doctrine is an equitable doctrine” but that “that doctrine is not a claim” and, instead, “ ‘merely furnishes a means for a complainant to reach a second corporation or individual upon a cause of action that otherwise would have existed only against the first corporation.’ ” 788 So.2d at 145 (quoting 1 William Meade Fletcher, Fletcher Cyclopedia of the Law of Private Corporations § 41.10 (perm. ed. rev.vol.1999)). Here, the appellants maintain, the count in the counterclaim seeking to pierce the corporate veil is “an integral part of the [already adjudicated] breach of contract claim,” and the trial court has thus not disposed of that claim in its entirety. Cf. Banyan Corp. v. Leithead, 41 So.3d 51, 54 (Ala.2009) (trial court’s resolution of alter ego claim did not also determine liability for related breach-of-contract claim; therefore, because breach-of-contract claim was not fully adjudicated, Rule 54(b) certification of partial summary judgment entered on that claim was error). The appellants also contend that the facts giving rise to the legal and equitable claims are so similar and intertwined that separate resolution of those claims creates a likelihood of “piecemeal” appeals, which this Court clearly disfavors. See, e.g., First Southern Bank v. O’Brien, 931 So.2d 50, 53 (Ala.Civ.App.2005) (noting that “ ‘ “[appellate review in a piecemeal fashion is not favored, and trial courts should certify a judgment as final, pursuant to Rule 54(b), only in a case where the failure to do so might have a harsh effect” ’ ” (quoting other cases) (emphasis omitted)), and Day v. Davis, 989 So.2d 1118, 1121 (Ala.Civ.App.2008) (stating that “[w]hen claims ‘are so interrelated that they should be adjudicated simultaneously and not piecemeal,’ a Rule 54(b) certification is not appropriate”).

As to this argument, Fines and the Fines shareholders attempt to demonstrate that Thom stands only for the undisputed proposition that a count seeking to pierce the corporate veil is appropriately disposed of in a nonjury setting after the related legal claim has been decided by a jury. Fines and the Fines shareholders also contend that piercing the corporate veil “is not a power that is exercised lightly” and proceed to analyze the merits of Stephens Properties’ piercing-the-corporate-veil count. Finally, Fines and the Fines shareholders dispute the appellants’ argument that the facts underlying the legal and equitable claims are so similar that this Court might be faced with a repetitive appeal following the trial court’s resolution of the remaining equitable counts.

It has been noted that a “Rule 54(b) certification does not authorize the entry of a final judgment on part of a single claim.... ” Fullilove v. Home Fin. Co., 678 So.2d 151, 154 (Ala.Civ.App.1996) (citing Precision American Corp. v. Leasing Serv. Corp., 505 So.2d 380 (Ala.1987)). We have also observed that “Rule 54(b) is properly applied in a situation where the claim and the counterclaim present more than one claim for relief, either of which could have been separately enforced.” Branch v. SouthTrust Bank of Dothan, N.A., 514 So.2d 1373, 1374 (Ala.1987) (citing Cates v. Bush, 293 Ala. 535, 307 So.2d 6 (1975) (emphasis added)). See also Pate v. Merchants Nat’l Bank of Mobile, 409 So.2d 797, 800 (Ala.1982) (holding Rule 54(b) certification appropriate under the facts because “[ejither of these claims could have been separately enforced”).

As the appellants correctly argue, Thom holds that an attempt to pierce the corporate veil does not present a separate claim for relief. Instead, Stephens Properties’ assertion of that equitable doctrine merely furnished the means by which it sought to collect any breach-of-contract award against Fines from another source, namely the Fines shareholders. Thus, the judgment on the jury verdict as to the liability aspect of the breach-of-contract claim disposed of only a single aspect of that particular claim. Cf. Waiters v. Autry Greer & Sons, Inc., 784 So.2d 1068, 1070 (Ala.Civ.App.2000) (noting that partial summary judgment addressing only proximate causation “dispose[d] of one aspect of Waiters’s damages claim rather than completely disposing of a particular claim”). At this juncture, the breach-of-contract claim is not fully resolved because it has not yet been decided who will pay the judgment on the breach-of-contract claim — Fines or the Fines shareholders individually. Because this remaining determination is directly related to, and, in fact, is part and parcel of, the jury’s breach-of-contract award in Stephens Properties’ favor, the appellants have demonstrated that that claim is intertwined with the piercing-the-corporate-veil count in the counterclaim.

B. The Presence of a Possible Setoff

The incomplete nature of the breach-of-contract claim and the ultimate resolution of the attempt to pierce the corporate veil, discussed above, would also impact a possible setoff in this case. Specifically, in the event Stephens Properties obtains a judgment against the Fines shareholders, individually, for the $439,410 past-due rent, that judgment could be set off by the $57,000 conversion judgment against Stephens Properties, thus eliminating that lesser judgment.

A potential for a setoff, the appellants note, “weighs against the certification of the [underlying] [j]udgment as ... final.” The Supreme Court has stated that the “mere presence of [a nonfrivolous counterclaim] does not render a Rule 54(b) certification inappropriate.” Curtiss-Wright Corp. v. General Electric Co., 446 U.S. 1, 9, 100 S.Ct. 1460, 64 L.Ed.2d 1 (1980). See also Scrushy v. Tucker, 955 So.2d 988, 999 (Ala.2006) (same). Similarly, “the possibility of a setoff [is not] necessarily disposi-tive of questions regarding the appropriateness of a Rule 54(b) certification.” H.P.H. Props., Inc. v. Cahaba Lumber & Millwork, Inc., 811 So.2d 554, 556 (Ala.Civ.App.2001) (Murdock, J., concurring in the result) (citing Curtiss-Wright, supra, for the proposition that the “court of appeals erred in dismissing appeal from a Rule 54(b) judgment on one of main claims merely because counterclaim remained pending that might offset judgment entered”). Nonetheless, as reflected in the five-factor analysis set out in Rosenberg, supra, although not dispositive in and of itself, the existence of a nonfrivolous counterclaim or other issue that could result in a possible setoff, such as we have here, “[is] surely not an insignificant factor” in evaluating the appropriateness of a Rule 54(b) certification. Curtiss-Wright, 446 U.S. at 12. See also Harper Sales Co., 742 So.2d at 192 (determining that trial court’s Rule 54(b) certification was inappropriate because the “later resolution of [the remaining] counterclaim could affect the amount of damages awarded”). The potential for a setoff affecting the breach-of-contract judgment in this case weighs against the Rule 54(b) certification.

C. Whether There Was “No Just Reason for Delay”

Finally, the appellants contend that, although in certifying its judgment as final and allowing the matter to proceed to appeal the trial court found no just reason for delay, there were no harsh effects avoided or advantage gained by an immediate appeal as opposed to allowing the case to take its ordinary course. To the contrary, they point to “miscellaneous factors” that, they say, demonstrate that “a harsh effect results to [them] ... as a result of the Rule 54(b) certification,” including the freedom of Fines and the Fines shareholders to pursue execution of their judgments. Fines and the Fines shareholders, of course, dispute the harsh effects claimed by the appellants as a result of the Rule 54(b) certification.

Initially, we note the absence of any cross-appeal by Fines and the Fines shareholders related to the trial court’s denial of their Rule 60(b) motion or to the judgment against Fines in favor of Stephens Properties on the breach-of-contract claim. We further note that, although there appears to be no danger here of inconsistent results or repetitive appeals as to the same issue should we proceed with examination of the claims certified by the trial court as final, the likelihood of future appeals in this matter by the Fines shareholders exists in the event Stephens Properties is successful on its remaining claims for equitable relief, or by Stephens Properties if it is not.

The possibility of a future appeal and this Court’s general disfavor of Rule 54(b) certifications, coupled with the interrelated nature of the still pending counterclaims and the potential for setoff, which potential Fines and the Fines shareholders do not dispute, convinces us that the posture of this case is not yet appropriate for Rule 54(b) certification, that accepting the trial court’s certification will simply result in appellate review in piecemeal fashion, and that there is, in fact, just reason for delay. See O’Brien, 931 So.2d at 53 (noting that “ ‘ “[ajppellate review in a piecemeal fashion is not favored, and trial courts should certify a judgment as final, pursuant to Rule 54(b), only in a case where the failure to do so might have a harsh effect” ’ ” (quoting other cases) (emphasis omitted)). Because “[t]he judgment on the jury verdict was not a final judgment, and, because of the nature of the pending [issues], could not be transformed into a final judgment by a Rule 54(b) certification,” the trial court’s Rule 54(b) certification was erroneous and is due to be set aside. Harper Sales Co., 742 So.2d at 192. In the absence of a final judgment, this appeal is due to be dismissed.

APPEAL DISMISSED.

MALONE, C.J., and STUART, PARKER, and WISE, JJ., concur.

      . This violation occurred on the property where the recycling plant was located, not at the site of the proposed landfill.

      . As to the two remaining counterclaims asserted by Stephens Properties, the trial court’s pretrial order specifically noted: "The parties all agree that the issue of potential foreclosure of the stock and piercing the corporate veil are equitable remedies that will be addressed by the court in a post jury trial setting.”

      . Stephens Properties and Stephens assert that the trial court’s Rule 54(b) certification was entered "sua sponte.”

      . Moreover, as noted in Opinion of the Clerk No. 54, supra, when a valid severance under Rule 21 occurs, the clerk of the trial court then dockets those severed claims as a separate case with a new civil-action number, which requires an additional filing fee by the plaintiff in the severed action. 982 So.2d at 1061 (citing Opinion of the Clerk No. 45, supra, as referenced in the Committee Comments Adopted February 13, 2004, to Rule 21, Ala. R. Civ. P.). The record before us does not suggest, and Fines and the Fines shareholders do not allege, that the clerk of the trial court docketed the allegedly severed equitable counterclaims with a new civil-action number or that Stephens Properties was required to pay a separate filing fee as to those claims. See Woods, 49 So.3d at 185 n. 4.

      . Similarly, it appears that Stephens Properties' success on the judicial-foreclosure count as to Isbell's stock, which the jury found had been pledged as security for past-due rent and which the trial court’s order reflects will also be later addressed, would also affect the amount of the breach-of-contract award to Stephens Properties.

      . It appears from the record that Fines and the Fines shareholders have engaged in post-judgment execution efforts; it appears that the appellants opted to forgo posting a super-sedeas bond.


source: Caselaw Access Project

author: BRYAN, Judge. THOMAS, J.,

license: Public Domain

text:
    Gary HARRISON and Patsy Harrison v. FAMILY HOME BUILDERS, LLC.
    2100524.
    Court of Civil Appeals of Alabama.
    Nov. 4, 2011.

      Rodney B. Slusher, Florence, for appellants.
    David K. Howard and Katy Beth Lewey of Carr, Allison, Pugh, Howard, Oliver & Sisson, P.C., Florence, for appellee.
   BRYAN, Judge.

Gary Harrison and Patsy Harrison appeal from a summary judgment in favor of Family Home Builders, LLC (“FHB”). We affirm in part, reverse in part, and remand.

Factual Background and Procedural History

On January 5, 2007, the Harrisons and FHB entered into a written contract (“the contract”) in which FHB agreed to perform remodeling and construction work (“the work”) on the Harrisons’ existing house in Lauderdale County. FHB began the work; however, on May 4, 2007, the Harrisons terminated the contract before FHB had completed the work.

On July 16, 2007, the Harrisons sued FHB, stating claims of breach of contract, negligence, and fraud. As the basis of their breach-of-contract claim, the Harri-sons alleged (1) that FHB had agreed to perform the work in accordance with plans and specifications provided by the Harri-sons and had failed to do so; (2) that FHB had failed to complete the work; (3) that FHB had agreed to perform the work in accordance with applicable building codes and had failed to do so; (4) that the work performed by FHB had defects in materials and workmanship; (5) that FHB had failed to coordinate and supervise the work in an efficient manner; and (6) that FHB had overbilled the Harrisons for costs not related to the work.

As the basis of their negligence claim, the Harrisons alleged that FHB had breached the duty of care it owed the Harrisons by failing to perform the work in a workmanlike manner, by failing to perform the work in accordance with the plans and specifications provided by the Harrisons, by failing to complete the work in a timely manner, by failing to perform the work in accordance with the applicable building codes, and by failing to coordinate and supervise the work in a proper manner.

As the basis of their fraud claim, the Harrisons alleged that, while it was performing the work, FHB had misrepresented to the Harrisons that certain costs were incurred in performing the work and that, in reliance on those misrepresentations, the Harrisons had paid FHB for materials and labor costs that had not been incurred in the performance of the work.

Answering, FHB denied the material allegations of the Harrisons’ complaint. The Harrisons later amended their complaint to add a claim that FHB had negligently hired, trained, supervised, and retained (“the negligent-supervision claim”) Kyle Gean, the individual who had supervised the work for FHB. Answering, FHB denied the material allegations of the Harri-sons’ amended complaint.

On March 29, 2010, FHB moved for a partial summary judgment with respect to the Harrisons’ fraud claim. The Harrisons filed no evidence in opposition to that motion, and the trial court entered an order granting it on May 20, 2010.

On August 17, 2010, FHB moved for a summary judgment with respect to the breach-of-contract claim, the negligence claim, and the negligent-supervision claim. FHB asserted that it was not liable for breach of contract or negligence based on the allegation that it had failed to perform the work in accordance with the plans and specifications because, FHB said, the Har-risons had substantially changed the plans and specifications after the contract was executed. FHB asserted that it was not liable for breach of contract or negligence based on the allegation that it had failed to complete the work because, FHB said, it was entitled to a reasonable amount of time to complete the work because the contract neither specified a date for completion of the work nor stated that time was of the essence and the Harrisons had unilaterally terminated the contract before FHB had had a reasonable amount of time to complete the work. FHB asserted that it was not liable for breach of contract or negligence based on the allegation that it had failed to perform the work in accordance with the applicable building codes because, FHB said, the Harrisons had not produced substantial evidence indicating that FHB had failed to perform its work in accordance with the applicable building codes and, even if FHB had failed to perform its work in accordance with the applicable building codes, the evidence indicated that the Harrisons had not given FHB a reasonable amount of time to correct such failures before unilaterally terminating the contract. FHB asserted that it was not liable for breach of contract or negligence based on the allegation that there were defects in material and workmanship because, FHB said, the Harrisons had failed to produce substantial evidence indicating that there were defects in materials and workmanship. FHB asserted that it was not liable for breach of contract or negligence based on the allegation that it had failed to coordinate and supervise the work in an efficient manner because, FHB said, the Harrisons had failed to produce substantial evidence indicating that FHB had failed to coordinate and supervise the work in an efficient manner. FHB asserted that it was not liable for breach of contract based on the allegation that it had overbilled the Harrisons because, FHB said, the Harrisons had admitted that they had no evidence indicating that FHB had overbilled them. Finally, FHB asserted that it was not liable for negligent supervision because, it said, the Harrisons had not produced substantial evidence indicating that Gean was incompetent.

FHB supported its summary-judgment motion with, among other things, the deposition testimony of Gean and the contract. Gean testified as follows. He was not an employee of FHB; he acted as a subcontractor of FHB in preparing an estimate of the cost of the work before the contract was signed and in supervising the work after the contract was signed. Before the execution of the contract, he discussed the work with the Harrisons and submitted an estimate to them. His estimate was based on drawings provided by the Harrisons and quotes he had received from vendors and subcontractors. The drawings on which he based his estimate showed the addition of an outdoor kitchen, the removal of the windows from the back of the house, the removal of the windows from the garage, the removal of the doors from the garage, the addition of a concrete pad, and the remodeling of a bedroom and bathroom located in the western end of the house. Based on those drawings, Gean estimated that the work would cost $109,000 and would take approximately four months to complete. After the contract was signed, the Harrisons and their decorator, Madelyn Hereford, made substantial changes to the work. For example, in March and April 2007, the size of the outdoor kitchen was changed, the size of a pavilion was changed, a porch was added to the western side of the house, a porch was added to “the bay addition” to the house, sidewalks were added, the bay addition to the house was enlarged and changes were made to the recessed tub, the mantel, the fireplace, the tray ceiling, the coffee bar, the windows, and the french doors in that addition. Those changes increased the amount of the work to be performed, increased the cost of the work, and delayed the performance of the work because those changes required that some of the work that had been completed in accordance with the original drawings be redone. Gean estimated that approximately one-half of the work had been completed when the Harrisons unilaterally terminated the contract on May 4, 2007.

The contract signed by the parties on January 5, 2007, expressly provided that all representations made before the signing of the contract were merged into the contract. The contract neither specified a date for completion of the work nor stated that time was of the essence. Moreover, it did not specify a total price for the work. Instead, it provided that the Harrisons would pay all the costs of performing the work and, in addition, would pay FHB a contractor’s fee in the amount of 13% of those costs. In addition, the contract required FHB to perform the work in accordance with plans and specifications provided by the Harrisons and to comply with “the construction requirements of all local building codes.”

In opposition to FHB’s summary-judgment motion, the Harrisons asserted (1) that FHB’s failure to complete the work was caused by its incompetence rather than the changes made to the plans and specifications after the contract was signed; (2) that FHB’s contention that the Harrisons had failed to produce substantial evidence indicating that FHB had failed to comply with the applicable building codes had no merit; (3) that FHB’s contention that the Harrisons had failed to produce substantial evidence indicating that the work performed by FHB was defective had no merit; (4) that FHB’s contention that the Harrisons had failed to produce substantial evidence indicating that FHB had failed to coordinate and supervise the work in a proper manner had no merit; and (5) that it was a question of fact whether FHB had had a reasonable amount of time to complete the work when the Harrisons terminated the contract.

As evidence in opposition to the summary-judgment motion, the Harrisons submitted, among other things, the affidavits of Gary Harrison and Derrick Coffman and the Harrisons’ answers to FHB’s interrogatories. In his affidavit, Gary Harrison testified as follows. Before the contract was signed, Gean estimated that the work would cost $109,500 and would take three to four months to complete; however, when the Harrisons terminated the contract on May 4, 2007, FHB had performed only approximately 50% of the work, yet costs of between $135,000 and $145,000 had already been incurred. Gary Harrison further testified:

“As stated in my attorney’s termination letter, the work performed by [FHB] was not performed in a competent and workmanlike manner in conformity with the applicable building codes.... In our answer to [FHB’s] interrogatory number 4, my wife and I listed a number of examples of defective work performed by [FHB] at our house....
“During the course of performance of the job by [FHB], we experienced a recurrent problem with [FHB’s] not properly manning the job. [FHB’s] employees were not consistently on the job on a daily basis and we experienced some weeks in which there were no employees of [FHB] on the job at all. On other occasions, we saw one or two of [FHB’s] employees at our house working when a full crew was expected and needed.
“Our job also was not properly supervised by Kyle Gean, [FHB’s] representative on the site. Kyle was not on our job on a regular basis and this was perhaps because we learned he was working on other jobs at the same time as he was being paid to work at our house. Mr. Gean failed to order materials needed for use in the work in a timely fashion[] as well as he ordered materials which were not suitable for use at our house and this required the proper materials to be reordered. Mr. Gean did not properly schedule the work or properly coordinate the work of the subcontractors and his employees working at our house. For example, the sheetrock man was scheduled to sheet-rock when the room to be sheet rocked was not prepared and as a result his work had to be rescheduled. The pavilion overhead construction was begun before the brick wall and header were addressed and this caused work to be stopped on the outside addition. Defective work performed by [FHB] also had to be torn out and redone and the repair work necessitated additional time to be performed. Finally, Mr. Gean did not follow the drawings, plans and directions of Madelyn Hereford, our interior decorator, and Robert Weber, our architect, and the work prescribed by them was never undertaken by [FHB] and this led to a disorganized work progress schedule.
“The failure of [FHB] to complete our project in a timely and reasonable manner is due to the incompetent, negligent and substandard work of [FHB] as outlined above. If [FHB] had properly manned the job, followed the directions of our architect and interior designer, properly supervised and coordinated the work of its employees and other subcontractors working at the project and performed its work in a workmanlike manner, our project would have been completed by mid April 2007. Prior to terminating [FHB], I asked [FHB] to commit that it could complete my project by May 18, 2007, but [FHB] refused to make that commitment. I subsequently terminated [FHB’s] contract and hired Coffman Custom Homes to correct and repair [FHB’s] work and complete the work which [FHB] had failed to complete.”

FHB’s interrogatory number 4, which Gary Harrison referred to in his affidavit, asked the Harrisons to describe any instances of FHB’s work that they contended were negligent or defective. In answer to that interrogatory, the Harrisons stated:

“Concrete was poured without any vapor barrier, wire mesh or control (expansion) joints. Concrete blocks under weight bearing walls of pavilion 'and outdoor kitchen were laid 4" too high and had to be sawed off. Concrete had excessive cracking in all directions and the cracks were of good size. An error in calculating the amount of color needed for coloring the concrete was made causing the concrete on the west end of house to have to be poured on a different date. There were no utilities put under the concrete pad (except for a drain that was installed improperly) and the color was uneven and splotchy looking. The sealer appears to have been put on before the concrete had completely cured, causing bubbling. Concrete was never scored as agreed and there were low spots which allowed water to stand. In some areas of the slab the concrete was sloped toward the house which would allow water to get underneath the house. There were spots where the sealer was thicker than in other areas, making shiny spots. Kyle Gean had homeowner to hand dig the walkway on the river side of the pool and showed the elevation to be used. After the walkway was dug, limestone gravel began to ‘weep’ from under the retainer wall of the pool, causing an eventual settling and cracking of the pool retainer wall and deck. Spa tub framing (banger structure) was in contact with the ground but pressure treated material was not used and concrete footer was not adequate to hold weight of tub filled with water. Header across windows on west end of new construction (bathroom) was not to code. Concrete pad beside garage door entrance had high spots which would not allow pad to drain. Downspout at pad was not run under concrete. Load bearing wall in new walk-in closet was not built on a double floor joist and was therefore not properly supported. Shrubs and plants were stacked over to one side on each end of house for reuse, but irrigation system was severely damaged so as to prevent watering of shrubs which subsequently died. Irrigation system was hit numerous times during excavation without having the problem areas marked and the irrigation system controller was found laying out in the weather under a row of shrubs. Pavilion framing was not done according to code and had to be torn down and rebuilt. The ‘I-joists’ that were purchased for use on the Pavilion ceiling were cut on a diagonal contrary to the manufacturer’s specifications and has deemed them inoperable. Two sets of French doors that were ordered by Kyle Gean were delivered but were incorrect in that each French door had ten (10) lights instead of five (5) lights per door and had to be re-ordered. One of the French doors was supposed to be 4 feet wide but the order was for a five-foot door. The order for the new doors and windows was not placed in a timely manner and somewhat delayed the project. Brick facing to Pavilion footer was laid incorrectly and had to be torn away and re-laid. When the brick facing to the concrete pad was re-laid, it changed the spacing on the brick and several of the mortar joints (rows) were excessively wide. The footer to the Pavilion and outdoor kitchen was not low enough causing the ground next to pool deck to be higher than the pool deck itself. Brick color did not match the brick on the original house and will have to be stained to make match. Tray ceilings in the master bath area were installed and had to be torn out and re-installed. Electrical plugs and light fixture mounting boxes are installed along with the wiring but wiring is not connected to a circuit breaker box. West bathroom wall built and then furred out to approximate a 2" x 6" wall (actually 1 ½" x 6") and the window that was ordered was 5 ⅛" which leaves a 1 ½" [sic] void that must be furred out. The floor of the new part of the bathroom was built approximately 5/16" higher than the floor in the original part. This discrepancy will cost more in time for the tile setter having to taper this discrepancy out over the width of the floor. Corners of fascia boards are butt joined rather than miter joints as are used around the rest of the house. Sheet rock man was scheduled to install sheet rock on two different occasions but the house was not ready for him to start. Homeowner and 3 men worked 1 ½ days to prepare room. Insulation was not scheduled and after showing up the sheetrock installer went home for 2 days before completing job. Trim work and sheet rock were torn up on the north wall of the closet and guest bath area but shouldn’t have been and had to be replaced. Fire access was not installed [in] attic area of new addition which is against code.”
Derrick Coffman’s affidavit stated:
“My name is Derrick Coffman, I am over the age of twenty-one and a resident citizen of Lauderdale County, Alabama. I have personal knowledge of the facts hereinafter stated in this Affidavit.
“I am self-employed as a residential home builder. I am and have been for several years licensed as a residential home builder by the Home Builders Li-censure Board of the State of Alabama. As such, I am familiar with the various building codes which are and have been in effect establishing standards for the construction and/or renovation of residences in this State.
I know the [Harrisons]. I was introduced to the [Harrisons] through work which my firm, Coffman Custom Homes, performed at the [Harrisons’] house ... pursuant to a cost plus contract. My cost plus contract with the Harrisons was made sometime after they had terminated their contract with [FHB], My scope of work included repairing any defective work performed by [FHB] as well as completing the work which [FHB] had failed to complete under its agreement with Mr. and Mrs. Harrison.
“I am familiar with the work performed by [FHB] at the Harrisons’ residence based on my inspection of the work prior to entering into my contract with the Harrisons as well as the problems my firm encountered later as a result of the defective workmanship of [FHB] at the residence. The work generally performed by [FHB] which I observed at the Harrison residence generally did not comply with the standards of the Southern Building Code or for that matter failed to conform with the standards of any other building code with which I am familiar and/or with standards of good workmanship. The negligent and defective workmanship of [FHB] at the [Harrisons’] house created additional problems and expenses for the Harrisons in repairing [FHB’s] incompetent work. For example, the concrete pad at the rear of the house had to be completely torn out and rebuilt because of excessive cracking. There were numerous other examples of incompetent and negligent workmanship, like the pavilion work, but time and space do not allow me to list all of these problems in this affidavit.
“[FHB’s] work at the Harrisons’ residence was substandard, did not conform with the standards of the Southern Building Code or any other code and was not performed in compliance with standards of good building practice. Including the cost of tearing out a large portion of [FHB’s] work, the cost to the [Harrisons] for repairing the work of [FHB] was $151,411.55. In addition, the [Harrisons] paid my firm an additional sum for completing [FHB’s] work. I estimate [FHB] had completed only about fifty percent (50%) of its work under its contract with the Harrisons and, as stated, most of this work had to be removed and replaced or repaired.”

FHB moved to strike Gary Harrison’s and Coffman’s affidavits on the ground that they contained statements that were inadmissible because they were not based on personal knowledge or constituted hearsay. Thereafter, FHB deposed Coff-man and filed a supplemental brief in support of its summary-judgment motion with excerpts from Coffman’s deposition attached. FHB asserted that Coffman’s testimony supported FHB’s contention that the Harrisons had not given FHB a reasonable amount of time to complete the work and cited Coffman’s testimony that the work required by the contract between FHB and the Harrisons was “a one year project at minimum.” FHB also asserted that Coffman’s testimony supported FHB’s contention that the changes in the plans and specifications made by the Harrisons and their decorator had caused delays in FHB’s performance of the work and cited the following testimony by Coffman:

“[By FHB’s attorney] Q. If the plans were to change, would that cause it to take longer? ■ ,
“A. Yes.
“Q. Why is that?
“A. Well, if you’ve built to a certain plan and then you have to backtrack and tear something out and change it, of course, that can take longer. If you’ve got a set of plans and you’re building to them plans and plans and changes are made prior to you getting to the step and stages of the change, then other than a few minutes of sitting down and saying let’s do it this way instead of that way, that doesn’t make much of an increase in your time. Only if you’ve already went past that point and you have to go hack and tear ■ something out, a change that way could add to the time. “Q. How do changes such as that affect lining up your subcontractors?
“A. Well, if a certain subcontractor is scheduled to be there a certain day and a change causes you to not be ready for them that certain day, then they have to reschedule. A lot of times they’ve got another job scheduled past yours. So, sometimes they’ll go to your next job and you’ll get bumped to the end of their list and then you’ll have to get them when they’re available more than when you’re ready for them.”

However, Coffman testified that the concrete poured by FHB’s subcontractor was defective because it had cracks that extended below the surface and because some of its surface sloped away from the drains that had been installed in the concrete. Coffman further testified that, due to those defects, all the concrete poured by FHB’s subcontractor had to be torn out and replaced. Coffman also testified that the cracks in the concrete could have resulted from a failure to compact the soil before the concrete was poured, which would be a violation of the International Residential Building Code; however, he did not know whether FHB’s subcontractor had failed to compact the soil.

In addition, Coffman testified that FHB’s subcontractor had not framed a bathroom correctly, which was a violation of the International Residential Building Code, and that he had to redo that framing. He testified that FHB’s subcontractor had failed to use treated wood around the recessed tub in the bathroom and that he had to replace it with treated wood. He testified that FHB’s subcontractor had failed to seal the windows in the bathroom correctly and that, as a result, water was coming in around the window frame. He testified that he had to remove the windows, redo the sealing, and then put the windows back in.

Coffman also testified that the framing for a room that was being added in another part of the house had to be taken down and redone because the supporting “I joists” were cut, which deprived them of structural integrity.

The Harrisons moved to strike FHB’s supplemental brief in support of its summary-judgment motion. On February 8, 2011, the trial court entered an order denying the Harrisons’ motion to strike FHB’s supplemental brief and granting FHB’s summary-judgment motion. On March 4, 2011, the Harrisons appealed to the supreme court, which transferred the appeal to this court pursuant to § 12-2-7(6), Ala.Code 1975.

Standard of Review

“We review a summary judgment de novo. American Liberty Ins. Co. v. AmSouth Bank, 825 So.2d 786 (Ala.2002).

“ We apply the same standard of review the trial court used in determining whether the evidence presented to the trial court created a genuine issue of material fact. Once a party moving for a summary judgment establishes that no genuine issue of material fact exists, the burden shifts to the non-movant to present substantial evidence creating a genuine issue of material fact. “Substantial evidence” is “evidence of such weight and quality that fair-minded persons in the exercise of impartial judgment can reasonably infer the existence of the fact sought to be proved.” In reviewing a summary judgment, we view the evidence in the light most favorable to the nonmovant and entertain such reasonable inferences as the jury would have been free to draw.’
“Nationwide Prop. & Cas. Ins. Co. [v. DPF Architects, P.C.], 792 So.2d [369] at 372 [(Ala.2001)] (citations omitted), quoted in American Liberty Ins. Co., 825 So.2d at 790.”

Potter v. First Real Estate Co., 844 So.2d 540, 545 (Ala.2002).

Analysis

A. The fraud claim

The Harrisons have not raised an issue regarding the propriety of the trial court’s granting FHB’s partial-summary-judgment motion with respect to the Har-risons’ fraud claim and have not argued that the trial court erred in granting that motion. “ ‘An appeals court will consider only those issues properly delineated as such, and no matter will be considered on appeal unless presented and argued in brief. Ex parte Riley, 464 So.2d 92 (Ala.1985).’ ” Tucker v. Cullman-Jefferson Cntys. Gas Dist., 864 So.2d 317, 319 (Ala.2003) (quoting Braxton v. Stewart, 539 So.2d 284, 286 (Ala.Civ.App.1988)) (emphasis omitted). Accordingly, we affirm the partial summary judgment with respect to the Harrisons’ fraud claim.

B. The breach-of-contract claim

The Harrisons argue that the trial court erred in granting the summary-judgment motion with respect to their breaeh-of-con-tract claim insofar as that claim is based on (1) the allegation that FHB failed to perform the work in accordance with the plans and specifications provided by the Harrisons, (2) the allegation that FHB failed to perform the work in a workmanlike manner, and (3) the allegation that FHB failed to complete the work.

“ ‘[N]ot every partial failure to comply with the terms of a contract by one party ... will entitle the other party to abandon the contract at once.’ ” Birmingham News Co. v. Fitzgerald, 222 Ala. 386, 388, 133 So. 31, 32 (1931) (quoting 6 R.C.L. p. 926). In the case now before us, in order for the Harrisons to establish that they had the right to unilaterally terminate the contract on May 4, 2007, they bore the burden of proving that FHB had committed a breach of the contract that was ‘of so material and substantial a nature as would constitute a defense to an action brought by [FHB] for [the Harrisons’] refusal to proceed with the contract.’ ” Id. (quoting 3 Williston on Contracts § 1467). “Whether or not a given breach is so material or essential may be frequently a question of fact to be determined by the jury, yet if in a particular case the question is so clear as to be decided only in one way, it is a question of law for the court.” Id.

In order for FHB’s breach of the contract to constitute a defense to an action brought by FHB based on the Harri-sons’ refusal to proceed with the contract, the breach must be sufficient to establish that FHB had not rendered substantial performance of the contract. See John D. Calamari & Joseph M. Perillo The Law of Contracts § 11.18(b) (4th ed. 1998) (“Substantial performance is the antithesis of material breach. If a breach is material, it follows that substantial performance has not been rendered.”). “Substantial performance of a contract does not contemplate exact performance of every detail but performance of all important parts.” Mac Pon Co. v. Vinsant Painting & Decorating Co., 423 So.2d 216, 218 (Ala.1982).

The Harrisons’ answer to FHB’s interrogatory number 4, the testimony regarding defects in the concrete contained in Coffman’s affidavit, and the testimony regarding defects in the concrete and the framing contained in Coffman’s deposition testimony constituted substantial evidence tending to prove that FHB had failed to perform some of its work in a workmanlike manner. See Potter v. First Real Estate Co., 844 So.2d at 545 (“ ‘ “Substantial evidence” is “evidence of such weight and quality that fair-minded persons in the exercise of impartial judgment can reasonably infer the existence of the fact sought to be proved.” ’ ”). We conclude that the question whether that evidence indicates that FHB committed a material breach of the contract that entitled the Harrisons to terminate the contract unilaterally is a question of fact to be determined by a jury. See Birmingham News Co. v. Fitzgerald, 222 Ala. at 388, 133 So. at 32 (“Whether or not a given breach is so material or essential may be frequently a question of fact to be determined by the jury....”). Therefore, we reverse the summary judgment with respect to the breach-of-contract claim insofar as that claim is based on the allegation that FHB failed to perform the work in a workmanlike manner.

Insofar as their breach-of-contract claim is based on the allegation that FHB failed to perform the work in accordance with the plans and specifications, the Harrisons argue that the trial court erred in granting the summary-judgment motion because, they say, (1) Madelyn Hereford, their decorator, testified that FHB installed plumbing pipes and electrical wiring in the wall to the left of a sliding pocket door instead of to the right as specified by the plans, which required that those pipes and wires be torn out and reinstalled, and (2) Gary Harrison testified in his affidavit that “Mr. Gean did not follow the drawings, plans and directions of Madelyn Hereford, our interior decorator, and Robert Weber, our architect.... ” That testimony of Gary Harrison is a mere eonelusory statement that, “ ‘cannot be considered in ruling upon a summary[-]judgment motion.’ ” B.M. v. Crosby, 581 So.2d 842, 843 (Ala.1991) (quoting trial court’s order). Hereford’s testimony tended to prove one instance of FHB’s failure to follow the plans and specifications. However, in order for that one instance of FHB’s failure to follow the plans and specifications to constitute a material breach of the contract, it would have to be sufficient to establish that FHB had failed to render substantial performance of the contract. See Birmingham News Co. v. Fitzgerald, 222 Ala. at 388, 133 So. at 32; and Calamari & Perillo The Law of Contracts § 11.18(b). We conclude that that one instance alone is not sufficient to establish that FHB failed to render substantial performance of the contract. See Mac Pon Co. v. Vinsant Painting & Decorating Co., 423 So.2d at 218 (“Substantial performance of a contract does not contemplate exact performance of every detail but performance of all important parts.”); and Birmingham News Co. v. Fitzgerald, 222 Ala. at 388, 133 So. at 32 (“Whether or not a given breach is so material or essential may be frequently a question of fact to be determined by the jury, yet if in a particular case the question is so clear as to be decided only in one way, it is a question of law for the court.”). Therefore, we affirm the summary judgment with respect to the breach-of-contract claim insofar as that claim is based on the allegation that FHB failed to follow the plans and specifications.

Insofar as their breach-of-contract claim is based on the allegation that FHB failed to complete the work, the Harrisons argue that the trial court erred in granting the summary-judgment motion because, they say, (1) Gean testified that, before the contract was signed, he had estimated that it would take three to four months to complete the work; (2) Gary Harrison testified that FHB could have completed the work by mid-April 2007 if it had performed the work properly; and (3) Hereford testified as follows:

“[By FHB’s attorney] Q. In your judgment, with all the changes that were made — and it goes up — in your notes, up until April the 1st, between April 1st and 6th. Due to those changes, this job couldn’t be completed by March or April of 2007; is that fair?
“A. Yes — no—wait a minute. Is it fair that it was not completed by March or April?
“Q. Due to the changes?
“A. I see no reason that it could not have been completed.
“Q. Okay. Even changes that were still made in March and April, huh?
“A. Well, look at the changes that were made. We changed from a jetted tub to spa. That — I believe that is — the space was already there. The framing could have been done.”

We cannot consider Gean’s estimate that it would take three to four months to perform the contract because the contract expressly provided that all representations made before the signing of the contract were merged into the contract. In Ex parte Palm Harbor Homes, Inc., 798 So.2d 656, 660-61 (Ala.2001), the supreme court explained:

“As a general rule, ‘when parties reduce a contract to writing and intend that writing to be the complete contract, no extrinsic evidence of prior or contemporaneous agreements will be admissible to change, alter, or contradict the contractual writing.’ Sherman v. Woerner Magnolia Farms, Inc., 565 So.2d 601, 605 (Ala.1990). This is so, because, ‘all prior and contemporaneous negotiations are [deemed to be] merged’ into that writing. Crimson Indus., Inc. v. Kirkland, 736 So.2d 597, 601 (Ala.1999) (emphasis in original).
“ “When a contract contains ... a merger clause, the agreement is deemed to be “integrated,” such that evidence of prior or contemporaneous agreements shall not be admitted to contradict the terms of the agreement.’ Johnson Enters. of Jacksonville, Inc. v. FPL Group, Inc., 162 F.3d 1290, 1309 (11th Cir.1998). Merger clauses thus create a presumption that the writing represents an integrated, that is, the final and complete, agreement of the parties. See Tallmadge Bros., Inc. v. Iroquois Gas Transmission Sys., L.P., 252 Conn. 479, 504, 746 A.2d 1277, 1291 n. 15 (2000). ‘In order to rebut the presumption and, in effect, invalidate the merger clause, a party must offer evidence to establish the existence of fraud, bad faith, uncon-scionability, negligent omission or mistake in fact.’ Smith v. Central Soya of Athens, Inc., 604 F.Supp. 518, 526 (E.D.N.C.1985). See also Lake Martin/Alabama Power Licensee Ass’n, Inc. v. Alabama Power Co., 601 So.2d 942, 945 (Ala.1992) (“When fraud in the inducement has been ruled out, ... all prior statements and negotiations are merged into the written contract and ... in the absence of an ambiguity ..., parol evidence will not be received to explain, contradict, vary, add to, or subtract from the express terms of the written contract.’). Whether a contract is integrated is ordinarily a question of law for the court to decide. Moore v. Pennsylvania Castle Energy Corp., 89 F.3d 791, 797 (11th Cir.1996); Associated Catalog Merchandisers, Inc. v. Chagnon, 210 Conn. 734, 740, 557 A.2d 525, 528 (1989); Walker v. Saricks, 360 Pa. 594, 599, 63 A.2d 9, 11 (1949); see also Hibbett Sporting Goods v. Biernbaum, 375 So.2d 431, 435 (Ala.1979).”

In the ease now before us, the Harrisons have not argued that an exception to the merger doctrine applies to Gean’s estimate. Consequently, the merger clause in the contract precludes us from considering the estimate. See Ex parte Palm Harbor Homes, Inc.

Because the contract neither specified a date for completion of the work nor stated that time was of the essence, FHB was entitled to a reasonable time to perform the contract. See Lemon v. Golf Terrace Owners Ass’n, 611 So.2d 263, 265 (Ala.1992) (“[W]here a contractual obligation to perform exists, and no time is prescribed in the contract for performance, the law requires the obligated party to perform within a ‘reasonable time.’ ”). Although Coffman, who testified as an expert witness on behalf of the Harrisons, testified in his deposition that it would take a minimum of a year to perform the work, the Harrisons submitted sufficient evidence to establish a genuine issue of material fact regarding whether the Harrisons afforded FHB a reasonable time to perform the work before terminating the contract on May 4, 2007. Id. (“What is a reasonable time depends on the nature of the act to be done and all of the circumstances relating to that act. This, necessarily, is a question to be determined by the trier of fact.”). Moreover, we conclude that, if a jury should find that the Harri-sons afforded FHB a reasonable time to complete the work, it would also be a jury question whether FHB’s failure to complete the work by May 4, 2007, constituted a material breach of the contract that would entitle the Harrisons to terminate the contract unilaterally. Birmingham, News Co. v. Fitzgerald, 222 Ala. at 388, 133 So. at 32. Therefore, we reverse the summary judgment with respect to the breach-of-contract claim insofar as that claim is based on the allegation that FHB failed to complete the work.

The Harrisons have not challenged the summary judgment with respect to the breach-of-contract claim insofar as that claim is based on any other allegations. “When an appellant fails to argue an issue in its brief, that issue is waived.” Boshell v. Keith, 418 So.2d 89, 92 (Ala.1982). Therefore, we affirm the summary judgment with respect to the breach-of-contract claim insofar as that claim is based on any allegation other than the allegations that FHB breached the contract by failing to perform the work in a workmanlike manner and by failing to complete the work.

C. The negligence claim

The Harrisons challenge the summary judgment with respect to the negligence claim insofar as that claim is based on the allegations that FHB failed to supervise the performance of the work in a proper manner, failed to perform the work in a workmanlike manner, and failed to perform the work in accordance with the plans and specifications. The same evidence that we held constituted substantial evidence indicating the FHB had not performed some of its work in a workmanlike manner for purposes of the breach-of-eon-tract claim also constitutes substantial evidence indicating that FHB failed to perform some of its work in a workmanlike manner for purposes of the negligence claim. Accordingly, based on that evidence, we reverse the summary judgment with respect to the negligence claim insofar as it is based on the allegation that FHB failed to perform some of its work in a workmanlike manner. See Potter v. First Real Estate Co., 844 So.2d at 545.

Moreover, Hereford’s testimony that FHB installed the pipes and wires to the left of the pocket door instead of to the right of it as required by the plans and specifications constitutes substantial evidence tending to prove that FHB failed to perform the work in accordance with the plans and specifications. Id. For purposes of the breach-of-contract claim, it was necessary that the Harrisons establish that FHB’s failure to perform the work in accordance with the plans and specifications constituted a material breach of the contract, and we are affirming the summary judgment with respect to the breach of contract claim insofar as it is based on the allegation that FHB failed to perform the work in accordance with the plans and specifications because we have concluded that the single instance of FHB’s failure to perform the work in accordance with the plans and specifications attested to by Hereford did not establish that it constituted a material breach of the contract. However, for purposes of the negligence claim, the Harrisons are not required to prove that FHB’s failure to perform the work in accordance with the plans and specifications constituted a material breach of the contract. Accordingly, based on Hereford’s testimony that FHB installed the pipes and wires to the left of the pocket door instead of to the right of it as required by the plans and specifications, we reverse the summary judgment with respect to the negligence claim insofar as it is based on the allegation that FHB failed to perform the work in accordance with the plans and specifications.

With respect to the allegation that FHB failed to supervise the performance of the work in a proper manner, Gary Harrison testified in his affidavit that Gean failed to come to the job site on a regular basis, failed to order materials in a timely manner, and failed to schedule and coordinate the work of subcontractors in a proper manner. In addition, Gary Harrison described two examples of Gean’s failure to coordinate the work of subcontractors in a proper manner. Gary Harrison also testified that Gean had ordered materials that were not suitable for the work, which had to be replaced. That testimony constituted substantial evidence indicating that FHB had not supervised the performance of the work in a proper manner. See Potter v. First Real Estate Co., 844 So.2d at 545. Accordingly, we reverse the summary judgment with respect to the negligence claim insofar as it is based on the allegation that FHB failed to supervise the performance of the work in a proper manner.

The Harrisons have not challenged the summary judgment with respect to the negligence claim insofar as that claim is based on any other allegations. “When an appellant fails to argue an issue in its brief, that issue is waived.” Boshell v. Keith, 418 So.2d at 92. Accordingly, we affirm the summary judgment with respect to the negligence claim insofar as that claim is based on any allegations other than the allegations that FHB failed to perform the work in a workmanlike manner, failed to perform the work in accordance with the plans and specifications, and failed to supervise the performance of the work in a proper manner.

D. The negligent-supervision claim

The Harrisons first argue that the trial court erred in granting the summary-judgment motion with respect to the negligent-supervision claim because, they say, FHB’s narrative statement of undisputed fact “fails to include a factual statement pertaining to the issue of [FHB’s] negligent employment, supervision, and/or retention of the services of Kyle Gean.” Harrison’s brief, at p. 39. However, FHB asserted that it was entitled to a summary judgment with respect to the negligent-supervision claim on the ground that the Harrisons had not produced substantial evidence indicating that Gean was incompetent. “When the basis of a summary-judgment motion is a failure of the non-movant’s evidence, the movant’s burden ... is limited to informing the court of the basis of its motion — that is, the moving party must indicate where the nonmoving party’s case suffers an evidentiary failure.” Rector v. Better Houses, Inc., 820 So.2d 75, 80 (Ala.2001). The Harrisons have cited no legal authority standing for the proposition that, when the basis of a summary-judgment motion is a failure of the non-movant’s evidence, the movant must include in his or her narrative statement of undisputed facts a factual statement regarding the failure of that evidence.

“Rule 28(a)(10), Ala. RApp. P., requires that arguments in an appellant’s brief contain ‘citations to the cases, statutes, other authorities, and parts of the record relied on.’ ... [I]t is well settled that a failure to comply with the requirements of Rule 28(a)(10) requiring citation of authority in support of the arguments presented provides this Court with a basis for disregarding those arguments. Ex parte Showers, 812 So.2d 277, 281 (Ala.2001).”

State Farm Mut. Auto. Ins. Co. v. Motley, 909 So.2d 806, 822 (Ala.2005). Because the Harrisons have not cited any legal authority supporting their first argument regarding the negligent-supervision claim, we decline to consider that argument. Id.

The Harrisons also argue that the trial court erred in granting the summary-judgment motion with respect to their negligent-supervision claim because, they say, the trial court had before it evidence indicating that Gean had never supervised a job as large as the work to be performed on the Harrisons’ house, that the principals of FHB seldom came to the job site to check on the performance of the work and voiced no concerns about the quality of the work to Gean despite the Harrisons’ complaining to them, that Gean failed to supervise the performance of the work in a proper manner, and that the work was not performed in a workmanlike manner. However, the Harrisons have not supported this argument with any legal authority. Therefore, we decline to consider it. Id. Accordingly, we affirm the summary judgment with respect to the negligent-supervision claim.

Conclusion

In summary, we reverse the summary judgment with respect to the breach-of-contract claim insofar as it is based on the allegations that FHB failed to perform the work in a workmanlike manner and that FHB failed to complete the contract within a reasonable time; we reverse the summary judgment with respect to the negligence claim insofar as it is based on the allegations that FHB failed to perform the work in a workmanlike manner, failed to perform the work in accordance with the plans and specifications, and failed to supervise the performance of the work in a proper manner; we affirm the judgment of the trial court in all other respects; and we remand the cause for further proceedings consistent with this opinion.

AFFIRMED IN PART; REVERSED IN PART; AND REMANDED.

THOMPSON, P.J., and PITTMAN and MOORE, JJ., concur.

THOMAS, J.,

concurs in the result, without writing.

      . The record on appeal does not indicate whether the trial court ruled on FHB's motion to strike Gary Harrison’s and Coffman’s affidavits.