author: STUART, Justice. WOODALL, Justice MURDOCK, Justice

text:
    Jacklyn McMAHON and Donald McMahon v. YAMAHA MOTOR CORPORATION, U.S.A., et al.
    1100679.
    Supreme Court of Alabama.
    March 2, 2012.
    Rehearing Denied May 18, 2012.

      Frank M. Wilson, Montgomery; Fredric G. Levin and Virginia M. Buchanan of Levin, Papantonio, Thomas, Mitchell, Echsner, Rafferty & Proctor, P.A., Pensacola, Florida; and J. Cole Portis of Beasley, Allen, Crow, Methvin, Portis & Miles, P.C., Montgomery, for appellants.
    De Martenson, David L. Brown, Jr., and J. Patrick Strubel of Huie, Fernambucq & Stewart, LLP, Birmingham, for appellees.
   STUART, Justice.

Jacklyn McMahon and Donald McMahon sued the following defendants in the Lowndes Circuit Court: Yamaha Motor Corporation, U.S.A.; Yamaha Motor Manufacturing Corporation of America; Yamaha Motor Co., LTD. (hereinafter referred to collectively as “the Yamaha defendants”); and Montgomery Outdoor Power Products, Inc., d/b/a Montgomery Yamaha-Honda. They asserted a products-liability claim under the Alabama Extended Manufacturer’s Liability Doctrine (“AEMLD”), as well as negligence, wantonness, breach-of-warranty, and loss-of-consortium claims, after Jacklyn was injured in July 2007 when the 2007 Yamaha Rhino 660, a two-passenger off-road utility vehicle that the McMahons had purchased from Montgomery Yamaha-Honda, rolled over while she was driving it, resulting in injuries to her arms and legs when she apparently extended them out of the vehicle in an attempt to support herself and/or the vehicle during the rollover. The action was subsequently transferred to the Montgomery Circuit Court and, after Montgomery Yamaha-Honda was dismissed as a defendant, the action proceeded to trial. At the close of evidence, the McMahons withdrew their breach-of-warranty claim and the Yamaha defendants moved for a judgment as a matter of law on the remaining claims. The trial court granted that motion with respect to the McMahons’ negligence and wantonness claims, and the remaining AEMLD claim was submitted to the jury. After the jury returned a verdict in favor of the Yamaha defendants, the trial court entered a final judgment in accordance with that verdict. The McMa-hons appeal the judgment on the negligence and wantonness claims. We affirm in part and reverse in part.

I.

The McMahons first argue that the trial court erred by entering a judgment as a matter of law in favor of the Yamaha defendants on their negligence and wantonness claims. We have stated:

“When reviewing a ruling on a motion for a [judgment as a matter of law], this Court uses the same standard the trial court used initially in deciding whether to grant or deny the motion for a [judgment as a matter of law]. Palm Harbor Homes, Inc. v. Crawford, 689 So.2d 3 (Ala.1997). Regarding questions of fact, the ultimate question is whether the nonmovant has presented sufficient evidence to allow the case to be submitted to the jury for a factual resolution. Carter v. Henderson, 598 So.2d 1350 (Ala. 1992). The nonmovant must have presented substantial evidence in order to withstand a motion for a [judgment as a matter of law]. See § 12-21-12, Ala. Code 1975; West v. Founders Life Assurance Co. of Florida, 547 So.2d 870, 871 (Ala.1989). A reviewing court must determine whether the party who bears the burden of proof has produced substantial evidence creating a factual dispute requiring resolution by the jury. Carter, 598 So.2d at 1353. In reviewing a ruling on a motion for a [judgment as a matter of law], this Court views the evidence in the light most favorable to the nonmovant and entertains such reasonable inferences as the jury would have been free to draw. Id.”

Waddell & Reed, Inc. v. United Investors Life Ins. Co., 875 So.2d 1143, 1152 (Ala. 2003). Under this standard of review, we must consider whether the McMahons adduced substantial evidence at trial, that 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[s] sought to be proved,” to support either or both of their negligence and wantonness claims. West v. Founders Life Assur. Co. of Florida, 547 So.2d 870, 871 (Ala.1989).

In order to withstand the Yamaha defendants’ motion for a judgment as a matter of law with regard to their negligence claim, the McMahons were required to submit substantial evidence indicating (1) that the Yamaha defendants owed them a duty; (2) that the Yamaha defendants breached that duty; (3) that the McMa-hons suffered an injury; and (4) that the Yamaha defendants’ negligence was the actual and proximate cause of that injury. Ford Motor Co. v. Burdeshaw, 661 So.2d 236, 238 (Ala.1995). The gravamen of the McMahons’ negligence claim is that the Yamaha defendants had the duty to perform adequate testing on the Yamaha Rhino during the development of the product to ensure that the final product that was marketed and sold was reasonably safe for its intended purposes; yet, the McMahons argue, the Yamaha defendants failed to do so and Jacklyn’s injuries were the direct result of that failure. The Yamaha defendants argue that the Yamaha Rhino underwent significant testing during its development, that it is a fundamentally safe vehicle, that the accident was actually caused by Jacklyn’s contributory negligence, and that the McMahons failed to submit any evidence indicating that the Yamaha defendants were somehow negligent in designing and/or testing the Yamaha Rhino. Moreover, the Yamaha defendants argue, even if this Court concludes that the McMahons did introduce substantial evidence at trial to support their negligence claim, the jury clearly rejected that evidence and/or accepted the evidence of Jacklyn’s own negligence put forth by the Yamaha defendants, inasmuch as the jury returned a verdict against the McMahons on the AEMLD claim that it did consider. Accordingly, the Yamaha defendants argue, any error the trial court may have committed by entering a judgment as a matter of law in favor of the Yamaha defendants on the McMahons’ negligence claim at the close of the evidence was harmless. We agree.

In Atkins v. American Motors Corp., 835 So.2d 134,140 (Ala.1976), which, along with Casrell v. Altec Industries, Inc., 335 So.2d 128 (Ala.1976), is one of the cases in which this Court adopted the doctrine that is now known as the AEMLD, we referred to the “almost impossible burden” plaintiffs sometimes bore in attempting to establish negligence in produets-liability actions under the traditional negligence paradigm. We further explained how this burden would “be lightened” by the adoption of what has since become known as the AEMLD. 335 So.2d at 140. An AEMLD claim and a common-law negligence claim have different elements that must be proven, Yamaha Motor Co. v. Thornton, 579 So.2d 619, 621-23 (Ala. 1991), and we have previously explained that an AEMLD claim does not subsume a common-law negligence claim, Tillman v. R.J. Reynolds Tobacco Co., 871 So.2d 28, 35 (Ala.2003); however, there is nevertheless a measure of commonality between those claims. Specifically, a plaintiff pursuing a products-liability claim against a manufacturer under either theory can succeed only if the plaintiff establishes that the product at issue is sufficiently unsafe so as to render it defective. In an AEMLD case, this is done by proving that a safer, practical, alternative design was available to the manufacturer at the time it manufactured the allegedly defective product. General Motors Corp. v. Jemigan, 883 So.2d 646, 662 (Ala.2003). Once established, that is sufficient to succeed on the AEMLD claim. In a negligence case, the plaintiff must establish not only that the product at issue is defective, but also that the manufacturer failed to exercise due care in the product’s manufacture, design, or sale. Atkins, 335 So.2d at 139. However, even if a manufacturer failed to conduct any testing on a product, there could be no recovery for negligence in a products-liability action if the jury nevertheless concluded that the product was safe. With regard to either an AEMLD claim or a common-law negligence claim, the jury must be persuaded that the product at issue is defective before the plaintiff can prevail.

In returning a verdict in favor of the Yamaha defendants on the AEMLD claim, the jury necessarily concluded either (1) that the McMahons failed to establish that the Yamaha Rhino was an unsafe product, or (2) that the Yamaha defendants successfully established that Jacklyn’s accident was the result of contributory negligence on Jacklyn’s part. Either conclusion would have required a verdict in favor of the Yamaha defendants on the McMahons’ negligence claim as well if that claim had been submitted to the jury. See Hannah v. Gregg, Bland & Berry, Inc., 840 So.2d 839, 860 (Ala.2002) (stating that “[a] plaintiff cannot recover in a negligence action where the plaintiffs own negligence is shown to have proximately contributed to his damage” and that “a plaintiffs contributory negligence will preclude recovery in an AEMLD action” as well). Accordingly, even if the trial court erred by not submitting the McMahons’ negligence claim to the jury, that error was harmless; it does not entitle the McMahons to a new trial.

The McMahons also argue that they put forth substantial evidence to support their wantonness claim and that the trial court erred by entering a judgment as a matter of law in favor of the Yamaha defendants on that claim. We first note that “contributory negligence ... is not a bar to a wantonness claim.” Tyler v. City of Enterprise, 577 So.2d 876, 878 (Ala.1991). “ ‘Wantonness’ has been defined by this Court as the conscious doing of some act or the omission of some duty while knowing of the existing conditions and being conscious that, from doing or omitting to do an act, injury will likely or probably result.” Ex parte Essary, 992 So.2d 5, 9 (Ala.2007) (citing Bozeman v. Central Bank of the South, 646 So.2d 601 (Ala. 1994)). The McMahons argue that substantial evidence was produced at trial showing that the Yamaha defendants made various conscious decisions throughout the development and testing process of the Yamaha Rhino, as well as after initial reports of injuries involving the Rhino were received, knowing that injuries, especially injuries to arms and/or legs similar to those suffered by Jacklyn, would likely result from those decisions. For example, Dr. Michael Kleinberger, a professor of biomedical engineering with experience working in and managing crash-test facilities, testified regarding a 2001 internal Yamaha e-mail in which an employee of one of the Yamaha defendants stated that accidents involving the Yamaha Rhino that resulted in injuries would likely be of the rollover variety and further identified the specific risk of arm/wrist and leg/ankle injuries resulting from contact of those appendages with the ground and/or the vehicle as a result of the attempts of the belted occupants to support themselves and/or the vehicle during rollovers. When questioned by the McMahons’ attorney at trial, Dr. Kleinberger further testified:

“Q. Is there something that Yamaha could have done, in your opinion, to prevent these injuries, a different design?
“A. I think they should have had a door on the vehicle. You know, what I mentioned before, that the work that was done by John Zell-ner, the simulations and the testing really didn’t start until 2006 and finished in the middle of 2007. Following his work and his final report, Yamaha did decide at that point in time to put the doors on the vehicle. There is no reason why those test simulations could not have been done back in 2001 after this memo was sent or after this email was sent.”

“The ‘knowledge’ of the defendant is ‘the sine qua non of wantonness.’ ” Norris v. City of Montgomery, 821 So.2d 149, 156 n. 9 (Ala.2001) (quoting Ricketts v. Norfolk Southern Ry., 686 So.2d 1100, 1106 (Ala. 1996), quoting in turn Henderson v. Alabama Power Co., 627 So.2d 878, 882 (Ala. 1993)). Viewing this evidence in the light most favorable to the McMahons, as we must pursuant to our standard of review, Waddell & Reed, 875 So.2d at 1152, we conclude that there was substantial evidence introduced at trial from which the jury could have concluded that the Yamaha defendants had specific knowledge of the risk of arm and leg injuries posed by a rollover in the Yamaha Rhino and that they wantonly failed to address that risk in a timely manner.

We do note, however, the Yamaha defendants’ argument that they took all reasonable steps to prevent any injuries the Yamaha Rhino might cause and that there was no wanton misconduct on their part. We have not addressed in any detail the evidence submitted by the Yamaha defendants in this regard; it is sufficient simply to note that that evidence is substantial as well. For precisely that reason, a judgment as a matter of law in favor of any party on the McMahons’ wantonness claims would have been inappropriate. The judgment as a matter of law entered in favor of the Yamaha defendants on the McMahons’ wantonness claim is accordingly due to be reversed.

II.

Finally, the McMahons argue that the trial court exceeded its discretion by excluding certain evidence they sought to admit that referenced fatalities that had resulted from accidents involving the Yamaha Rhino. That specific evidence consisted of: (1) a chart summarizing 26 fatal accidents involving Yamaha Rhinos that was prepared and submitted to the Consumer Product Safety Commission (“the CPSC”) by the Yamaha defendants in 2008 after the CPSC began investigating the safety of the Yamaha Rhino, and (2) the following paragraph of a press release issued on March 31, 2009, after the CPSC and the Yamaha defendants had entered into a voluntary agreement terminating the CPSC’s investigation into the Yamaha Rhino:

“CPSC staff has investigated more than 50 incidents involving these three Rhino models, including 46 driver and passenger deaths involving the Rhino 450 and 660 models. More than two-thirds of the cases involved rollovers and many involved unbelted occupants. Of the rollover-related deaths and hundreds of reported injuries, some of which were serious, many appear to involve turns at relatively low speeds and on level terrain.”

The trial court excluded the chart and redacted the above-quoted paragraph in the press release pursuant to Rule 403, Ala. R. Evid., based on a belief that the introduction of evidence of fatalities resulting from accidents involving a Yamaha Rhino would be unduly prejudicial in this case, which involved an injury, not a fatality.

“A trial court’s ruling on the admission or exclusion of evidence will be reversed only if it is shown that the trial court exceeded its discretion in so ruling.” Jimmy Day Plumbing & Heating, Inc. v. Smith, 964 So.2d 1, 7 (Ala.2007). See also Queen v. Belcher, 888 So.2d 472, 477 (Ala. 2003) (noting that “a trial court has broad discretion concerning the admission of evidence”). As the Advisory Committee’s Notes to Rule 403 further explain, it is the duty of the trial court judge “to place the probative value or relevancy of evidence on one side of imaginary scales and its prejudicial impact on the other. When the prejudicial impact substantially outweighs the probative value, then the evidence may be excluded.” The Yamaha defendants argue that the potential prejudicial impact of the excluded evidence in the instant case is obvious, while its relevance is suspect, in light of the fact that a sizable number of the fatalities referenced in the excluded evidence were the result of accidents involving risk factors not all of which were present in Jacklyn’s accident. For example, of the 26 fatal accidents documented in the chart, all involved a rider who either was not wearing a helmet or was not wearing a seat belt, driver inattention, alcohol or drugs, excessive speed, inappropriate passenger position, an underage driver, and/or the inappropriate use of the Yamaha Rhino on paved roads. Moreover, the chart gives no indication as to whether the alleged instability of the Yamaha Rhino or the lack of occupant protection played a role in any of the documented accidents. We agree that the trial court had a reasonable basis under Rule 403 upon which to exclude the evidence the McMahons argue should not have been excluded; accordingly, we hold that the trial court did not exceed its discretion by excluding the evidence referencing fatalities resulting from Yamaha Rhino accidents.

III.

The McMahons sued the Yamaha defendants seeking damages based on injuries Jacklyn suffered in a rollover accident that occurred while she was driving a 2007 Yamaha Rhino the McMahons had purchased. Their negligence, wantonness, and AEMLD claims were heard by a jury; however, the trial court entered a judgment as a matter of law in favor of the Yamaha defendants on the negligence and wantonness claims at the close of evidence. The jury then returned a verdict in favor of the Yamaha defendants on the AEMLD claim, and the trial court subsequently entered a judgment on that verdict. On appeal, the McMahons argue that the trial court erred by not submitting their negligence and wantonness claims to the jury and by excluding certain evidence they wished to introduce. We agree that the McMahons produced substantial evidence to support their wantonness claim and that the trial court accordingly erred by entering a judgment as a matter of law in favor of the Yamaha defendants on that claim. As to the wantonness claim, therefore, the judgment is reversed. However, any error the trial court may have committed in entering a judgment as a matter of law in favor of the Yamaha defendants on the McMahons’ negligence claim was harmless because the jury’s verdict on their AEMLD claim establishes that their negligence claim would have been unsuccessful as well. The trial court acted within its discretion in choosing to exclude the evidence in question. Therefore, as to the negligence claim, the judgment is affirmed. This cause is accordingly remanded to the trial court for further proceedings consistent with this opinion.

AFFIRMED IN PART; REVERSED IN PART; AND REMANDED.

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

WOODALL and BOLIN, JJ., concur in part and dissent in part.

MURDOCK, J., concurs in the result in part and dissents in part.

WOODALL, Justice

(concurring in part and dissenting in part).

Insofar as the majority opinion affirms the trial court’s judgment, I concur. However, insofar as it reverses the judgment as a matter of law entered on Jacklyn McMahon and Donald McMahon’s wantonness claim, I respectfully dissent.

The majority “conclude[s] that there was substantial evidence introduced at trial from which the jury could have concluded that the Yamaha defendants had specific knowledge of the risk of arm and leg injuries posed by a rollover in the Yamaha Rhino and that they wantonly failed to address that risk in a timely manner.” 95 So.3d at 773. The only evidence of any such known risk identified in the majority opinion is “a 2001 internal Yamaha e-mail ... identifying] the specific risk of arm/ wrist and leg/ankle injuries resulting from contact of those appendages with the ground and/or the vehicle as a result of the attempts of belted occupants to support themselves and/or the vehicle during rollovers.” 95 So.3d at 773 (emphasis added). Although not mentioned in the majority opinion, Jacklyn McMahon was not wearing her seat belt at the time of the accident, and the majority opinion reveals no evidence of specific knowledge on the part of the Yamaha defendants of any risk to unbelted occupants during rollovers similar to the risk identified in the e-mail. For that reason I dissent from that part of the majority opinion that reverses the judgment as a matter of law on the McMahons’ wantonness claim.

BOLIN, J., concurs.

MURDOCK, Justice

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

I concur in the result reached by the main opinion as to the negligence claim asserted by Jacklyn McMahon and Donald McMahon. I respectfully dissent as to the main opinion’s conclusion that the trial court erred in not submitting to the jury the McMahons’ wantonness claim.

Before explaining the reasons for my votes on the aforesaid issues, I first take this opportunity to address the evidentiary issue discussed in Part II of the main opinion. Insofar as the main opinion reasons that a chart describing 26 fatal accidents involving the type of vehicle at issue should have been excluded on the ground that a sizeable number of the fatalities referenced in the excluded evidence were the result of accidents involving risk factors not present in this case, I can and do agree with the result reached by the main opinion with respect to upholding the trial court’s exclusion of that chart. I do not, however, see how the same reasoning is relevant to the exclusion of the particular language the trial court redacted from the press release jointly issued by the Yamaha defendants and the Consumer Product Safety Commission (“CPSC”). The redacted language clearly indicates that “[m]ore than two-thirds” of “more than 50 incidents” involving the type of vehicle at issue were “rollovers” and that “many appeared] to involve turns at relatively low speeds and on level terrain.” The fact that some of these incidents resulted in injuries so severe as to cause death only serves to enhance the import of the report for the purpose for which the McMahons sought to introduce it, namely as evidence indicating that the Yamaha defendants were aware of the risk of serious physical injury that existed in connection with use of the Rhino 660. Nonetheless, because the language in question was part of a press release issued jointly by the CPSC and the Yamaha defendants as part of an agreed-upon disposition by the CPSC of an investigation by it into the Yamaha Rhino, it appears that this language was due to be excluded in any event as a matter of law under Rule 408, Ala. R. Evid. (providing that “[e]vidence of conduct or statements made in compromise negotiations is ... not admissible”).

That said, I respectfully dissent from the result reached in Part I of the main opinion relating to the McMahons’ wantonness claim against the Yamaha defendants. I cannot conclude that there was substantial evidence of wantonness so as to have required the submission of this claim to the jury.

As to the McMahons’ negligence claim, I agree with the result reached in Part I of the main opinion, but I decline to join the analysis contained therein. Without limiting the foregoing, I write briefly to comment on one particular aspect of that analysis. Specifically, the main opinion notes that, “[i]n returning a verdict in favor of the Yamaha defendants on the AEMLD claim, the jury necessarily concluded either (1) that the McMahons failed to establish that the Yamaha Rhino was an unsafe product, or (2) that the Yamaha defendants successfully established that Jacklyn’s accident was the result of contributory negligence on Jacklyn’s part.” 95 So.3d at 772. I note that, in addition to contributory negligence, the jury was instructed as to the elements of the affirmative defense of assumption of the risk with respect to the McMahons’ AEMLD claims. Accordingly, it would also be appropriate to observe, at least with respect to the risk attendant to the lack of doors on the vehicle, that the jury’s verdict in favor of the Yamaha defendants on the AEMLD claim could have been a result of a finding of an assumption of the risk on Jacklyn’s part. Cf. Abney v. Crosman Corp., 919 So.2d 289 (Ala.2005) (discussing the open and obvious nature of an air rifle as a defense to a failure-to-warn claim); Griffin v. Summit Specialties, Inc., 622 So.2d 1299 (Ala.1993) (discussing the open and obvious nature of a product as a defense to an action alleging a design defect brought under Georgia law).

      . The McMahons and Montgomery Yamaha-Honda filed a joint stipulation and motion for the dismissal of all claims against Montgomery Yamaha-Honda, which the trial court granted.

      . Rule 403, Ala. R. Evid., provides, in pertinent part: "Although relevant, evidence may be excluded if its probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury....”

      . The Yamaha Rhino was designed strictly for off-road use.


source: Caselaw Access Project

author: BOLIN, Justice.

license: Public Domain

text:
    ALABAMA STATE BAR ASSOCIATION v. ChéRee Minor DUDLEY.
    1101362.
    Supreme Court of Alabama.
    March 2, 2012.
    Rehearing Denied May 18, 2012.

      J. Anthony McLain, gen. counsel, and Robert E. Lusk, Jr., asst. gen. counsel, Alabama State Bar Association, Montgomery, for appellant.
    William N. Clark and Glory R. McLaughlin of Redden, Mills & Clark, LLP, Birmingham, for appellee.
   BOLIN, Justice.

The Alabama State Bar Association (“the Bar”) appeals from a decision of a panel of the Disciplinary Board of the Bar (“the panel”) reinstating ChéRee Minor Dudley to the practice of law. We reverse and remand.

Facts and Procedural History

Dudley was admitted to the practice of law in 1997. On August 25, 2003, Dudley pleaded guilty in federal court to two felonies arising out of a mortgage-fraud scheme: (1) conspiracy to defraud in violation of 18 U.S.C. § 371, and (2) aiding and abetting wire fraud in violation of 18 U.S.C. § 1343 and 18 U.S.C. § 2. Dudley was sentenced to five months’ imprisonment for each count, the sentences to be served concurrently, and, upon release, she was to serve three years of supervised probation.

On May 27, 2004, Dudley waived the filing of formal charges by the Bar and pleaded guilty to violating Rules 4.1(a), 8.4(a), and 8.4(c), Ala. R. Prof. Conduct, arising out of the mortgage-fraud scheme. Dudley was suspended from the practice of law for three years effective July 13, 2004. On March 2, 2011, Dudley filed a petition for reinstatement with the Bar pursuant to Rule 28, Ala. R. Disc. P.

On May 12, 2011, the panel held a hearing on Dudley’s petition. At the conclusion of the hearing, a majority of the panel voted to reinstate Dudley. On June 14, 2011, the panel entered a final order reinstating Dudley on a probationary basis for a period of two years, with numerous conditions to the reinstatement.

On June 22, 2011, Dudley filed a motion to alter, amend, or vacate the order, seeking removal of the condition that Dudley not engage in the solo practice of law during her two-year probationary period. Subsequently, Dudley withdrew her motion. On June 23, 2011, the Bar filed a motion to alter, amend, or vacate the panel’s order on the ground that the panel had specifically found that Dudley had failed to comply with Rule 26(h), Ala. R. Disc. P., in that she had not obtained the permission of the Disciplinary Commission of the Bar to work in a law office during the period of her suspension. The Bar argued that the panel’s finding in that regard was prima facie evidence that Dudley failed to meet the burden of proof required for her reinstatement under Rule 28(c), Ala. R. Disc. P. The panel denied the Bar’s motion. The Bar timely appealed.

Discussion

Rule 28(c), Ala. R. Disc. P., provides:

“(c) Petitions for Reinstatement. Petitions for reinstatement shall be filed with the Disciplinary Clerk of the Alabama State Bar and served upon the General Counsel, and shall be in the form and contain the material specified in Appendix ‘A’ to these Rules. A petition that does not substantially comply with the form specified in Appendix ‘A’ or that does not contain the information and documents specified in Appendix ‘A’ or that does not contain satisfactory proof of compliance with the provisions of Rule 26 of these Rules shall constitute prima facie evidence that the petitioner has not met the burden of proof required for reinstatement under this rule, and the petition shall be summarily denied. Upon receipt by the Disciplinary Board of a petition that substantially complies with Appendix ‘A,’ a Disciplinary Hearing Officer shall promptly set the petition for a hearing. At the hearing, the petitioner shall have the burden of demonstrating by dear and convincing evidence that he or she has the moral qualifications to practice law in this state and that his or her resumption of the practice of law within the state will not be detrimental to the integrity and standing of the Bar or the administration of justice, and will not be subversive to the public interest. Proof of compliance with the provisions of Rule 26 of these Rules shall be a condition precedent to consideration of a petition for reinstatement. The Disciplinary Board shall, within seven (7) days after the hearing, issue an order granting or denying the petition.”

(Emphasis added.)

Rule 26, Ala. R. Disc. P., provides in pertinent part, as follows:

“(f) Maintenance of Records. A disbarred, suspended, or disabled lawyer, or lawyer that has surrendered his or her license, shall keep and maintain records of the various steps taken by him or her under these Rules so that, upon any subsequent proceeding instituted by or against him or her, proof of compliance with these Rules and with the disbarment or suspension order or order placing the lawyer on disability inactive status will be available.
“(h) Employment of Lawyers on Disability Inactive Status or Lawyers Who Have Been Suspended or Disbarred.
“(1) A disbarred lawyer may not engage in the practice of law or in any employment in the legal profession.
“(2) A lawyer on disability inactive status or a suspended lawyer may seek permission from the Disciplinary Commission to seek employment in the legal profession. Permission will be granted only if the lawyer has complied with all the conditions of suspension or disability inactive status and has demonstrated exemplary conduct indicative of reinstatement. In the event that permission is granted, the lawyer shall not have any contact with the clients of the office either in person, by telephone, or in writing.
“(3) A law firm may not employ, retain, contract with, or hire a disbarred lawyer to provide services, advice, or labor of the type customarily related to the provision of legal services. This specifically includes, but is not limited to, paralegal services, law-clerk services, research assistance, clerical assistance, secretarial services, office-management services, administrative-support services or any other services where the subject lawyer could have access to clients, clients’ files, or client confidences. If, however, permission has been granted to a suspended lawyer or a lawyer on disability inactive status as provided in paragraph (h)(2) of this rule, a law firm may employ the lawyer for purposes that do not conflict with paragraph (h)(2).”

This Court applies the “clearly erroneous” standard of review to the findings of fact of a panel of the Disciplinary Board. Tipler v. Alabama State Bar, 866 So.2d 1126 (Ala.2003). “‘“A finding is ‘clearly erroneous’ when although there is evidence to support it, the reviewing court on the entire evidence is left with the definite and firm conviction that a mistake has been committed.” ’ ” Tipler, 866 So.2d at 1137, quoting Anderson v. City of Bessemer City, N.C., 470 U.S. 564, 573, 105 S.Ct. 1504, 84 L.Ed.2d 518 (1985), quoting in turn United States v. United States Gypsum Co., 333 U.S. 364, 395, 68 S.Ct. 525, 92 L.Ed. 746 (1948). Questions of law presented by an appeal from a Bar matter are reviewed de novo. Tipler.

In the present case, the panel stated in its order of reinstatement:

“Ms. Dudley acknowledged she worked as an office assistant in the law office of Thomas P. Melton in 2006 and 2007. While Ms. Dudley claims she called and informed the State Bar, that communication could not be confirmed nor did she have written approval as required by Rule 26 to work in a law office while her license was suspended.
“Ms. Dudley also acknowledged that some of her tax returns while suspended listed her occupation as an attorney and also reflected deductions for expenses in connection with her law office, upon which she was paying a mortgage, even though she was not practicing law and received a 1099 from Mr. Melton.
“The majority of the Panel was of the opinion that Ms. Dudley by the required evidentiary standard, satisfied the burden incumbent upon her in Rule 28. A majority of the Panel believes that Ms. Dudley is remorseful and contrite and acknowledges and accepts responsibility for her misconduct and the shame and disrepute it brought to the legal profession.
“Based on the totality of the circumstances and the matters presented, the majority of the Panel concludes that Ms. Dudley has the moral qualifications to practice law and her resumption of the practice of law will not be detrimental to the integrity and standing of the Bar or the administration of justice and will not be subversive to the public interest.”

Although the panel reinstated Dudley, the panel made a factual finding that Dudley had worked in a law office during her suspension without complying with Rule 26, Ala. R. Disc. P. Rule 26 requires that a suspended lawyer obtain permission from the Disciplinary Commission of the Bar in order to work in the legal profession during the period of suspension. Dudley failed to obtain such permission. Dudley failed to comply with Rule 26, and the panel therefore erred in reinstating her to the practice of law, because Rule 28(c) clearly provides that proof of compliance with Rule 26 is a condition precedent to consideration for reinstatement to the practice of law. We pretermit any discussion as to whether such permission had to be in writing as the panel’s written order suggests. Accordingly, we reverse the panel’s judgment and remand the cause for proceedings consistent with this opinion.

REVERSED AND REMANDED.

MALONE, C.J., and WOODALL, STUART, PARKER, MURDOCK, SHAW, MAIN, and WISE, JJ., concur.

      . The Disciplinary Commission is composed of four members of the Board of Commissioners of the Bar and a chair, who is to assist and advise the members of the Disciplinary Commission. Rule 5, Ala. R. Disc. P.

      . Dudley's counsel stated that Dudley was not contending that she complied with Rule 26(h)(2), Ala. R. Disc, P., when she testified that the assistant general counsel for the Bar orally gave her permission to work during a telephone conversation between her and the assistant general counsel. Instead, Dudley acknowledged that the assistant general counsel may have stated that Dudley needed permission from the Disciplinary Commission to work in a law office during her suspension and that she did not "follow through.” We also note that the assistant general counsel, who represented the Bar in this matter, was sworn in as witness and testified that he never received a telephone call from Dudley and that it was his practice to tell any lawyer who had been suspended that only the Disciplinary Commission can give approval to the lawyer to work in a law office during the period of suspension.


author: THOMPSON, Presiding Judge.

text:
    Julie P. MAGEE, in her official capacity as Commissioner of Revenue of the State of Alabama, and the State of Alabama Department of Revenue v. The HOME DEPOT U.S.A., INC.
    2100715.
    Court of Civil Appeals of Alabama.
    Nov. 4, 2011.
    Certiorari Denied May 11, 2012 Alabama Supreme Court 1110220.

      Mark Griffin, asst, counsel and asst, atty. gen., Alabama Department of Revenue, for appellants.
    Bruce P. Ely, Philip J. Carroll III, James E. Long, Jr., and Marc James Ayers of Bradley Arant Boult Cummings LLP, Birmingham; and Randy M. Mastro, Jennifer H. Reardon, and Georgia K. Winston of Gibson, Dunn & Crutcher LLP, New York, New York, for appellee.
   THOMPSON, Presiding Judge.

Julie P. Magee, in her official capacity as the Commissioner of Revenue of the State of Alabama, and the State of Alabama Department of Revenue (collectively, “the Department”) appeal from a summary judgment entered by the Montgomery Circuit Court in favor of The Home Depot U.S.A., Inc. (“Home Depot”), reversing the Department’s denial of a refund of sales tax to Home Depot and awarding Home Depot a refund of sales tax in the amount of $266,672.93. For the reasons stated herein, we reverse the circuit court’s judgment.

The pertinent facts are undisputed. Home Depot operates retail home-improvement centers throughout the United States, including several in Alabama. In 1997, Home Depot entered into contracts with three related companies, General Electric Capital Corporation, GE Capital Financial, Inc., and Monogram Credit Card Bank of Georgia (collectively, “the finance companies”), for the provision of private-label credit cards to its customers (“the PLCC program”). Under the PLCC program, the finance companies provided customers of Home Depot with the opportunity to make purchases from Home Depot on credit. If a Home Depot customer decided to make a purchase utilizing the PLCC program, the customer would apply to one of the finance companies for credit. The finance company would evaluate the applicant’s creditworthiness and, in its sole discretion, decide whether and to what extent to offer credit to. the customer for making purchases at Home Depot. If the finance company approved the customer’s application, it would establish a credit account for the customer. When the customer made a purchase, the finance company would forward the amount of the customer’s purchase, including applicable taxes, less a service fee, to Home Depot for payment of the purchase. From this amount, Home Depot would pay the applicable sales tax to the appropriate governmental entity or entities. Home Depot deducted the service fee on its federal income-tax returns as a credit-card discount.

After the establishment of a credit account with one of the finance companies, a Home Depot customer utilizing the PLCC program would deal exclusively with the finance company with regard to payment of the account. The finance companies had the right to charge interest and fees on the credit accounts. Pursuant to the contracts between Home Depot and the finance companies, the finance companies were the sole and exclusive owners of all the credit accounts they established for Home Depot’s customers. In a situation in which a customer failed to pay off his or her credit account with one of the finance companies, the contracts provided that the finance companies would bear that loss and that they were not permitted to pass on those losses to Home Depot. The finance companies deducted those losses as bad debt on their federal corporate income-tax returns. In July 2003, a different company succeeded the finance companies as the issuer of Home Depot’s private-label credit cards.

On October 20, 2003, Home Depot filed a petition with the Department for a refund of $610,449.84 of sales tax it had paid from September 2000 to July 2003 for its customers who had participated in the PLCC program and who had defaulted in their obligations to repay the amount of the purchases they had financed with the finance companies. Home Depot relied on Ala. Admin. Code (Dep’t of Revenue), r. 810-6-4-.01 (“the bad-debt regulation”), which provides for a refund of sales tax paid by a retailer on credit accounts that are charged off as uncollectible for federal-income-tax purposes.

In a letter dated October 18, 2004, the Department denied Home Depot’s refund petition. In denying the petition, the Department took the position that gross receipts from sales that were paid for by credit cards were taxable on the full selling price. The letter from the Department stated that, if Home Depot wanted to pursue the matter further, it could request a formal hearing before an administrative law judge within two years of the date of its receipt of the letter or file an appeal directly to circuit court.

On September 22, 2006, Home Depot filed a notice of appeal to the Department’s Administrative Law Division, requesting a formal hearing. The Department filed a motion to dismiss the appeal for lack of jurisdiction because, it argued, Home Depot’s appeal was untimely. It argued that, pursuant to § 40-2A-7(c)(3), Ala.Code 1975, Home Depot’s petition for a refund had been denied by operation of law six months after it had been filed (i.e., on April 20, 2004) and, as a result, that the two-year period in which to file an appeal had expired on April 20, 2006, five months before Home Depot filed its notice of appeal. Ultimately, the administrative law judge (“the ALJ”) held that the Department was estopped from asserting that Home Depot’s appeal was untimely because the Department had affirmatively represented to Home Depot that it had two years from the date of its receipt of the letter of October 18, 2004, denying Home Depot’s refund petition in which to file its appeal to the Administrative Law Division.

On November 20, 2007, the ALJ held a hearing on Home Depot’s refund petition. Much of the testimony at the hearing focused on the service fee the finance companies charged Home Depot on its customers’ credit purchases under the PLCC program. Although it was acknowledged at the hearing that the contracts between Home Depot and the finance companies did not list the various elements that the finance companies and Home Depot considered in determining the amount of the service fee to be charged to Home Depot, testimony indicated that the finance companies attempted to estimate the amount of bad debt that would be generated as part of the PLCC program and that they set the service fee based, in part, on that estimate. Eugene Joseph Thorncraft, Jr., the vice president of risk management for General Electric Consumer Finance Division in America, testified as follows regarding how the finance companies determined the amount of the service fee to charge Home Depot when negotiating the contracts with Home Depot:

“[W]hen we negotiate a deal, we make a series of assumptions. We take a look at what our through-the-door populations are going to look like, or what the customers look like when they come through. We make a determination of how they are going to spend. How many are going to revolve and pay interest so we can determine a cash flow. We will know what our interest rates are. We will know how many will go delinquent so we can know what our late fee stream will be. Any other sundry income stream would be incorporated into that. We also then take a look at what our costs are going to be. Money costs, operating expense, bad debts, et cetera. From there we get a, kind of a portfolio level income stream. From that, we determine what our threshold of profitability should be. And based on that, we would assess fees to — we would set the service fee so we assess that fee to the retailer.”

Thorncraft stated that “bad debt is a critical element in the economic profile.” He also stated that the finance companies made a profit under the PLCC program and that their estimates with respect to anticipated bad debts were very close to the actual amount of bad debts they experienced under the program. Testimony at the hearing indicated that the service fee Home Depot paid the finance companies did not vary from customer to customer based on the customer’s creditworthiness.

At the hearing, Home Depot indicated that it had reduced its refund request to include only state sales taxes and Department-administered local sales taxes. The amended refund amount Home Depot requested was $383,341.29.

In its post-hearing briefs, Home Depot stated that it was entitled to a refund of sales tax because it had demonstrated the applicability of the bad-debt regulation to its refund petition. Particularly, Home Depot argued that it had paid the sales tax on the credit sales at issue and that the credit accounts associated with those sales had become uncollectible and were written off as bad debt. Home Depot argued, alternatively, that if the ALJ concluded that the only entity entitled to claim a refund under the bad-debt regulation is the entity that took a deduction for the bad debt on its income-tax returns, Home Depot qualified for the refund because it had fully compensated the finance companies for the bad debt they had incurred under the PLCC program by virtue of the service fee it had paid to the finance companies. Home Depot pointed to evidence at the hearing demonstrating that the future bad debt the finance companies would incur under the PLCC program was specifically considered in setting the amount of the service fee. Finally, Home Depot argued that denial of its refund petition would result in unjust enrichment to the State of Alabama because the Department would be retaining a greater amount of sales tax than Home Depot’s customers who defaulted on their obligations under the PLCC program had actually paid.

In its post-hearing brief, the Department argued that it had properly denied Home Depot’s refund petition because the finance companies, not Home Depot, owned the bad debt underlying Home Depot’s petition and the finance companies, not Home Depot, had written off the bad debt on their income-tax returns. The Department contended that Home Depot had received full payment from the finance companies for the PLCC-program transactions and that the finance companies did not transfer their bad debt arising under the PLCC program to Home Depot. It argued that, if Home Depot was allowed to recover the sales tax it had paid on the bad debts owned by the finance companies, Home Depot would realize more profit on the credit transactions than it would have had the customers simply paid in cash. The Department argued that the bad-debt regulation did not apply to Home Depot’s petition.

On June 6, 2008, the ALJ entered a detailed final order affirming the Department’s denial of Home Depot’s refund petition. The ALJ concluded that the bad-debt regulation did not apply to Home Depot’s refund petition; he construed the regulation as applying only in circumstances where the retailer itself makes the credit sale, not in circumstances involving credit-card sales “where credit is extended to the customer by a third party finance company, as in this case.” The ALJ also rejected Home Depot’s alternative argument that it was due the refund it sought because it had reimbursed the finance companies for their bad debt by paying them the service fee. The ALJ concluded that the amount of the service fee attributable to the estimate of bad debt to be incurred by the finance companies under the PLCC program could not be determined and that, “[e]ven if it is assumed that the fees included a bad debt component equal to the estimated bad debt amounts, ... the bad debts actually incurred by the [finance companies] may have been (or could be in the future) much greater than anticipated,” thus allowing Home Depot to claim a larger refund of sales taxes than had been reflected in the service fee it had paid to the finance companies. The ALJ also held that Home Depot could not prove the amount of Alabama sales tax it had paid on the bad debts because it could not prove that all of those sales had occurred in Alabama and that Home Depot could not demonstrate the amount of local sales tax it had paid on the bad debts to the local jurisdictions in Alabama administered by the Department. Thus, the ALJ affirmed the Department’s denial of Home Depot’s refund petition.

Home Depot filed an appeal of the Department’s determination to the Montgomery Circuit Court pursuant to § 40-2A-9(g)(1); Ala.Code 1975. In January 2009, Home Depot and the Department filed cross-motions for a partial summary judgment on the issue whether Home Depot was entitled to the refund of sales taxes for which it had petitioned. Reversing the ALJ’s determination, the circuit court granted Home Depot’s summary-judgment motion and denied the Department’s summary-judgment motion. The circuit court held that Home Depot had satisfied all the requirements of the bad-debt regulation and, as a result, that Home Depot was entitled to a refund of sales taxes paid on bad debt under that regulation. The Department filed an appeal, which this court dismissed as having been taken from a nonfinal judgment.

After this court dismissed the Department’s appeal, Home Depot filed a motion for a summary judgment as to the amount of the refund due. In its motion, Home Depot sought a refund amount of $266,672.98, reflecting a substantial reduction in the refund amount it had previously sought. Home Depot stated that it had reduced the amount of the sales-tax refund it was requesting “in an attempt to eliminate all questions regarding [its] data and calculations.” This new amount, according to Home Depot, reflected its elimination from its refund claim of: (1) local sales tax; (2) sales tax paid on bad debts resulting from purchases made by Alabama account holders at Home Depot’s stores located outside of Alabama; and (3) sales tax paid on bad debts that were subsequently paid by customers after having been taken as bad-debt deductions by the finance companies.

On March 15, 2011, the circuit court granted Home Depot’s motion and entered a summary judgment in its favor, awarding it the refund of sales tax that it sought. Because the summary judgment disposed of the remaining issue before the circuit court, that judgment constituted a final judgment. See Furin v. City of Huntsville, 8 So.3d 256, 260 (Ala.Civ.App.2008). The Department filed a timely appeal to this court.

Athough neither party has argued that this court is without jurisdiction, we first consider that question ex mero motu. See Ex parte Smith, 438 So.2d 766, 768 (Aa.1983). As previously noted, Home Depot filed its request for a refund on October 20, 2003. Because the Department did not act on Home Depot’s petition within six months of its filing, i.e., by April 20, 2004, the petition was deemed denied by operation of law. See § 40-2A-7(c)(3), Ma.Code 1975. However, after that date, the Department and Home Depot continued corresponding with one another relative to the refund petition. Finally, on October 18, 2004, the Department sent a letter to Home Depot stating, in pertinent part:

“On October 20, 2003, this department received the above referenced petition for refund of State Sales Tax.
“After a thorough investigation of your refund claim by our Foreign Audit Section and a decision made by Judge Thompson, (ALJS. 91-203) gross receipts derived from sales paid for by credit card are taxable on the full selling price. There would be no bad debt deductions even if the credit card company later determined the debt to be uncol-lectible.
“For this reason, we have no alternative but to deny your refund request.
“If you wish to pursue this matter further, you may request a formal hearing before an [ALJ] within two years from the date you receive this letter or you may appeal directly to circuit court. If you desire a hearing before an [ALJ], you must file Notice with the Aabama Department of Revenue, Administrative Law Division, P.O. Box 320001, Montgomery, Aabama 36132-0001.”

Home Depot filed its notice of appeal seeking a hearing with the ALJ on September 22, 2006, which was less than two years after its receipt of the Department’s letter but more than two years after its petition had been deemed denied by operation of law. We note that the timely filing of a notice of appeal from the denial of a refund petition is a prerequisite to an ALJ’s exercise of jurisdiction over the appeal. See § 40-2A-7(c)(5), Aa.Code 1975.

As noted, the Department filed a motion to dismiss the appeal to the Administrative Law Division as untimely. Initially, the ALJ granted that motion. Home Depot filed a motion for a rehearing, asserting that it had relied in good faith on the information provided by the Department in its October 18, 2004, letter, relative to the denial of its refund petition and the time for the taking of an appeal from that denial. In a detailed order, the ALJ granted Home Depot’s motion for a rehearing and reinstated its appeal, writing, in pertinent part:

“The Administrative Law Division initially granted the Department’s motion to dismiss for lack of jurisdiction because [Home Depot] failed to appeal within two years from when [Home Depot’s petition was deemed denied. [Home Depot] contends on rehearing, however, that the appeal should not be dismissed because it received an October 18, 2004, letter from the Department that stated that the refund was being denied, and that [Home Depot] had two years from that date to appeal. The letter specified that ‘[i]f you wish to pursue this matter further, you may request a formal hearing before an Administrative Law Judge within two years from the date you receive this letter.... ’ [Home Depot] claims that it relied in good faith on that information, and that its'appeal filed within two years of the October 18, 2004, letter should be accepted as timely.
“The Department does not dispute that the October 18, 2004, letter notified [Home Depot] that it had two years from that date to appeal. It contends, however, that the letter was a nullity, and could not extend or waive the two year statute of limitations for appealing. It also argues that it cannot be estopped from asserting the statutory time limit as a bar to the [Home Depot]’s refund claim. I disagree.
“Alabama’s Supreme Court has consistently held that the Revenue Department cannot be estopped from assessing and collecting a tax that is legally due. Community Action Agency of Huntsville, Madison County, Inc. v. State, 406 So.2d 890 (Ala.1981); State v. Maddox Tractor & Equipment Co. 260 Ala. 136, 69 So.2d 426 (1953). The Court has also held, however, that the State may be estopped from asserting that a taxpayer failed to timely appeal ‘where the untimeliness of the filing of their appeal was caused by misinformation furnished by the State’s officer and relied upon by the petitioners to their detriment.’ Ex parte Four Seasons, Ltd., 450 So.2d 110, 112 (Ala.1984). The rationale of Ex parte Four Seasons applies in this case.
“In Ex parte Four Seasons, the county tax assessor notified the petitioners that the county board of equalization had ruled on their protest on October 20, 1982. The petitioners were required by statute to appeal that decision to the circuit court within 30 days. They appealed on November 18, within 30 days from October 20.
“The State moved for [a] summary judgment because the board had actually denied the petitioners’ protest on or before October 4, 1982. Consequently, the petitioners had failed to appeal within 30 days from when the protest had actually been denied. The trial court and the Court of Civil Appeals held that the appeal must be dismissed as untimely-
“The Supreme Court reversed. ‘In the case before us, the secretary’s active misrepresentation of the date of the board’s decision is being used in an attempt to deny the taxpayers, who relied on it, their right to an appeal to a court of law. Such a result would obviously work a serious injustice. Furthermore, the public’s interest would not be unduly damaged by the imposition of estoppel in this case.’ Ex parte Four Seasons, 450 So.2d at 112.
“The Supreme Court subsequently applied its rationale in Ex parte Four Seasons in Talladega Board of Education v. Yancy, 682 So.2d 33 (Ala.1996); Ex parte Tanner, 553 So.2d 598 (Ala.1989); and Ex parte State Dept. of Human Resources, 548 So.2d 176 (Ala.1988). Likewise, the Court of Civil Appeals adopted the rationale of Ex parte Four Seasons in City of Mobile v. Sumrall, 727 So.2d 118 (Ala.Civ.App.1999), and Wallace v. Moore, 684 So.2d 161 (Ala.Civ.App.1996). The above cases establish that if a governmental employee acting in his or her official capacity gives an individual or an entity erroneous information that is relied on in good faith by the individual or entity, and which directly results in the individual or entity failing to timely appeal, the government is estopped from asserting the statute of limitations as a defense.
“In this case, [Home Depot] and the Department actively communicated concerning [Home Depot]’s refund claim after [Home Depot] filed its petition in October 2003. [Home Depot] submitted two letters to the Department on March 17, 2004, which provided additional information and/or documents concerning the refund claim, as requested by the Department. [Home Depot] later sent a June 21, 2004, letter to the Department that provided more information concerning its refund claim, again as requested by the Department. The above correspondence confirms that [Home Depot] had reason to believe that the Department was actively considering its refund claim up to when the Department notified [Home Depot] in writing on October 18, 2004, that its petition had been denied.
“Importantly, the Department’s October 18 letter also informed [Home Depot] that it had two years from that date to appeal. The Department is required to notify a taxpayer in writing within six months whether a petition has been granted or denied. Code of Ala.1975, § 40-2A-7(e)(3). The Department failed to do so in this ease. Consequently, the petition was deemed denied by operation of law six months after it was filed, or on April 20, 2004. See again, § 40-2A-7(c)(3). The Department was not thereafter required to notify [Home Depot] that the refund had been denied. It did so, however, pursuant to its October 18, 2004, letter. It also informed [Home Depot] in the letter that it had two years from that notice date to appeal.
“In Ex parte Tanner, supra, the probate court issued a condemnation order on May 8, 1984, but incorrectly notified the property owners that the order had been entered on May 22. The owners appealed within 30 days from May 22, but more than 30 days from when the order was actually entered. The Supreme Court, relying on its prior decisions in Ex parte Dept of Human Resources and Ex parte Four Seasons, held that ‘[although the probate court was not required to send the Tanners notice, once it did, they were entitled to rely on the date assigned’ to the condemnation order. Ex parte Tanner, 553 So.2d at 599.
“The above rationale applies in this case. The Department was not required to send [Home Depot] the October 18, 2004, letter notifying it that the petition was being denied because the petition had already been deemed denied by operation of law on April 20, 2004. It nonetheless did so, and also informed [Home Depot] that it had two years from that date to appeal. If the Department had not sent [Home Depot] the October 18 denial letter, the burden would have been on [Home Depot] to determine how long it had to appeal, i.e., two years from when the petition was deemed denied. But because the Department sent the October 18 letter and informed [Home Depot] that it had two years from that date to appeal, [Home Depot] was entitled to rely on that information.
“Estoppel would not apply if the Department had notified [Home Depot] after the appeal period had expired that it still had time to appeal. That is, an appeal period cannot be revived after it has expired. In this case, however, as in Ex parte Four Seasons and the other cases cited above, the erroneous information was provided while the appeal period was still open. But for the erroneous information, [Home Depot] could have appealed within two years from when the petition was deemed denied. It did not do so based on its reliance on the Department’s October 18, 2004, letter, which indicated that [Home Depot] had two years from that date to appeal. As in Ex parte Four Seasons, to not allow [Home Depot] to pursue its appeal “would obviously work a serious injustice. Furthermore, the public interest would not be unduly damaged by the imposition of estoppel in this case.’ Ex parte Four Seasons, 450 So.2d at 112.
“Estoppel would not, of course, apply in all cases where a Department employee gives a taxpayer erroneous advice concerning the taxpayer’s appeal rights. Rather, it must be applied (or rejected) on a case-by-case basis. For estoppel to apply, the advice or information must seem reasonable on its face, and the taxpayer must rely on the advice or information in good faith. The October 18, 2004, letter informing [Home Depot] that it had two years to appeal was reasonable on its face, especially considering that the Department and [Home Depot] had actively communicated concerning the refund claim even after the refund was deemed denied in April 2004. [Home Depot] also relied on the erroneous information in good faith. Estoppel applies under the facts of this case.”

We agree with the ALJ’s analysis of the issue of the timeliness of Home Depot’s appeal to the Administrative Law Division, and, like the ALJ, we hold that the Department, because of its October 18, 2004, letter, was estopped from asserting that the ALJ lacked jurisdiction to consider Home Depot’s appeal. As a result, we conclude that there are no jurisdictional impediments to our consideration of the present appeal.

We turn now to the merits of the Department’s appeal. The standard of review appropriate to this appeal was set forth in State Department of Revenue v. Wells Fargo Financial Acceptance Alabama, Inc., 19 So.3d 892 (Ala.Civ.App. 2008):

“Although the order of an ALJ is to be presumed prima facie correct in an appeal of that order in the circuit court, Ala.Code 1975, § 40-2A-9(g)(2), this court’s standard of review does not require that it give deference to either the ALJ’s decision or the circuit court’s judgment. Instead, because this is an appeal from a summary judgment and involves only questions of law, our review of the matter is de novo. State Dep’t of Revenue v. Gamer, 812 So.2d 380, 382 (Ala.Civ.App.2001). Because we are concerned with the application of tax statutes, we must be mindful of the principles governing their construction. ‘It is well settled that the right to reclaim money voluntarily paid to the state or the counties thereof, as taxes, is a creature of legislative grace.... ’ Lee v. Cunningham, 234 Ala. 639, 642, 176 So. 477, 480 (1937) (opinion on rehearing). Like tax exemptions, tax refunds are to be construed in favor of the taxing authority. Smith v. Sears, Roebuck & Co., 672 So.2d 794, 799 (Ala.Civ.App.1995); see also Ex parte Jefferson Smurfit Corp., 951 So.2d 659, 665 (Ala.2006) (stating that the right to a franchise-tax refund is a matter of legislative grace).”

19 So.3d at 894. We also note that “[t]his court and the trial court must give substantial deference to an agency’s interpretation of its rules and regulations” and that “ ‘[a]n agency’s interpretation of its own regulation must stand if it is reasonable, even though it may not appear as reasonable as some other interpretation.’ ” Mobile Cnty. Pers. Bd. v. Tillman, 751 So.2d 517, 518 (Ala.Civ.App.1999) (quoting Ferlisi v. Alabama Medicaid Agency, 481 So.2d 400, 403 (Ala.Civ.App.1985)).

In Wells Fargo, we provided the following background of Alabama tax law as it relates to the bad-debt regulation:

“Subject to certain exceptions not applicable here, a sales tax is levied on ‘every person, firm, or corporation, ... engaged or continuing within this state, in the business of selling at retail any tangible personal property whatsoever....’ Ala.Code 1975, § 40-23-2(1). Those persons or entities who meet the definition in § 40-23-2(1) are considered ‘taxpayers.’ § 40-23-1(a)(7) (defining taxpayer for purposes of the section as ‘[a]ny person liable for taxes hereunder’). Taxpayers must be licensed, § 40-23-6, and must pay the sales tax due on their gross receipts monthly. § 40-23-7(a); but see § 40-23-7(d) (permitting quarterly reports for those whose average sales-tax liability is under $200 per month). In addition, a taxpayer must keep records of its ‘gross sales, gross proceeds of sales, and gross receipts or gross receipts of sales’ and any other records necessary to compute the amount of sales tax due. § 40-23-9. The sales tax due on cash sales is to be computed and remitted monthly, § 40-23-7(a), while the sales tax due on credit sales is to be computed on each installment paid to the taxpayer. § 40-23-8. According to § 40-23-8, ‘in no event shall the gross proceeds of credit sales be included in the measure of the tax to be paid until collections of such credit sales shall have been made.’
“Because on some credit sales taxpayers were remitting the sales tax, which was later discovered not to be due because a portion of the purchase price was deemed to be uncollectible, the Department promulgated an administrative regulation that would allow a retailer to seek a refund of, or take a credit on a subsequent sales-tax report for, those sales taxes paid on certain qualifying uncollectible accounts. Ala. Admin. Code (Dep’t of Revenue), r. [810J-6-4-.01.”

19 So.3d at 894-95.

Regulation 810-6-4-.01, the bad-debt regulation, provides, in relevant part:

“(1) The term ‘bad debt or uncollectible account’ as used in this rule shall mean any portion of the sales price of a taxable item which the retailer cannot collect. Bad debts include, but are not limited to, worthless checks, worthless credit card payments, and uncollectible credit accounts. Bad debts, for sales and use tax purposes, do not include finance charges, interest, or any other nontaxable charges associated with the original sales contract, or expenses incurred in attempting to collect any debt, debts sold or assigned to third parties for collection, or repossessed property.
“(3) The term ‘credit sale’ shall include all sales in which the terms of the sale provide for deferred payments of the purchase price. Credit sales include installment sales, conditional sales contracts, and revolving credit accounts.
“(4) Sections 40-23-8 and 40-23-68(e), Code of Ala.1975, require that any person taxable under the law having cash and credit sales may report the cash sales, and the retailer shall include in each report all credit collections made during the preceding tax reporting period and shall pay the taxes due on the cash sales and the credit collections at the time of filing the tax report, but in no event shall the gross proceeds of credit sales be included in the measure of tax to be paid until collections of the credit sales have been made.
“(5) In the event a retailer reports and pays the sales or use tax on credit accounts which are later determined to be uncollectible, the retailer may ... obtain a refund for any tax paid with respect to the taxable amount of the unpaid balance due on the uncollectible credit accounts within three years following the date on which the accounts were charged off as uncollectible for federal income tax purposes.
“(6) If a retailer recovers in whole, or in part, amounts previously claimed as bad debt credits or refunds, the amount collected shall be included in the first tax report filed after the collection occurred. (Sections 40-23-8 and 40-2S-68(e))”

On appeal, the Department contends that Home Depot does not meet the requirements under the bad-debt regulation to seek a refund of sales tax. It argues that the regulation does not extend to credit-card transactions like those at issue in this case but that it applies only to retailers that extended credit directly to their customers. The Department argues that, because Home Depot did not extend credit to its customers who utilized the PLCC program and subsequently defaulted on their obligations to the finance companies, the bad-debt regulation does not permit Home Depot to obtain the refund it requests.

Home Depot responds that to be entitled to a refund of sales tax under the regulation, a retailer need only show that it reported and paid sales tax on credit accounts that were later determined to be uncollectible. It argues that it has met that standard in the present case because it reported and paid sales tax on the purchases its customers made on sales financed by the finance companies and it sought a refund with respect to those purchases that were subsequently written off as bad debt after the customers’ credit accounts were determined to be uncollectible. Home Depot asserts that the plain language of the regulation does not require that the retailer be the entity that extended credit to the purchaser. According to Home Depot, it is the retailer’s status as a taxpayer, not as a creditor, that allows a retailer to obtain a refund of sales tax paid on bad debt.

Given this court’s obligation to construe the bad-debt regulation in favor of the Department, see Wells Fargo, 19 So.3d at 894, as well as the substantial deference this court owes to the Department’s interpretation of its own regulations, see Mobile County Pers. Bd., 751 So.2d at 518, we conclude that the Department’s interpretation of the bad-debt regulation is correct. As the Department notes, the first sentence of subsection (1) of the regulation defines “bad debt or uncollectible account” as the portion of the sales price of a taxable item that the retailer cannot collect. In situations like the present case, involving third-party financing, the bad debt at issue does not relate to the retailer and is not a portion of the sales price of a taxable item that the retailer cannot collect. Instead, with regard to all the purchases giving rise to the bad debt at issue, Home Depot was not owed any amount of money by its customers, because it had been paid for those purchases up front by the finance companies.

Home Depot argues that subsection (1) of the bad-debt regulation does not limit bad debts to those incurred only by retailers because that subsection includes “worthless credit card payments” within the definition of “bad debt.” Home Depot fails to demonstrate, however, that the credit-card payments at issue in the present case were “worthless.” Indeed, at the time of each sale at issue in the present case, Home Depot received full payment from the finance companies for the items being purchased; such a transaction hardly involves a “worthless payment” from the finance companies. In our view, to constitute á “worthless credit card payment,” the payment made to the retailer must have, in fact, been worthless, much like a worthless check payment (also included within the definition of “bad debt” in subsection (1) of the regulation). The situation in the present case simply does not involve “worthless payments” as contemplated by the bad-debt regulation.

Subsection (3) of the bad-debt regulation defines “credit sale” as including “all sales in which the terms of the sale provide for deferred payments of the purchase price.” In the present ease, the “terms of the sale” between Home Depot and its customers did not “provide for deferred payments of the purchase price.” Instead, Home Depot was paid the entire purchase price plus sales tax, less a service fee, at the time of each sale. Thus, as to Home Depot, the sales at issue did not constitute “credit sales.” We recognize, as Home Depot argues, that the term “credit sale” is defined in the second sentence of subsection (3) to include, among other things, “revolving credit accounts,” which, Home Depot asserts, are the types of accounts at issue in the present case. However, as discussed, we construe the first sentence of subsection (3) as excluding from the scope of the definition those sales in which the retailer is paid for the purchase at the time of the sale, whether by the purchaser or by a finance company. Thus, the “revolving credit accounts” listed in the second sentence of subsection (3) necessarily refer to accounts owned by the retailer, not to those owned by a third-party finance company.

Finally, subsection (6) of the bad-debt regulation, like subsection (1), refers to a retailer’s collection of amounts due in a credit sale. This subsection again implies that the bad debt at issue is debt owned by the retailer itself because, in situations involving the third-party financing of purchases from a retailer, a retailer would not be in a position to “recover[ ] ... amounts previously claimed as bad debt credits or refunds.” Instead, in such situations, only the finance company would be in such a position.

Reading all of these subsections of the bad-debt regulation together, we conclude that subsection (5) of the bad-debt regulation, which provides for a refund of sales taxes paid on credit sales that are subsequently charged off as bad debt for income-tax purposes, does not apply in circumstances where, as in the present case, the retailer is not the entity that charged off the bad debt. Instead, we agree with the ALJ’s conclusion that, “[w]hen read together and in context, the various paragraphs in the [bad-debt] regulation clearly envision that the retailer must extend credit to the customer and own the account, and that if the account is not paid, the retailer must be the party that deducts the debt as uncollectible.”

Our conclusion as to the appropriate construction of the bad-debt regulation comports with the construction by other courts of their jurisdictions’ bad-debt-refund laws. For example, in In re Sales Tax Claim for Refund of Home Depot, 198 P.3d 902 (Okla.Civ.App.2008), the Court of Civil Appeals of Oklahoma was asked to construe, under circumstances virtually identical to those of the present ease, a tax-refund statute (Okla.Stat.tit. 68, § 1366) that read, in pertinent part:

“ ‘Taxes paid on gross receipts represented by accounts receivable which, on or after December 31, 1990, are found to be worthless or uncollectible and that are eligible to be claimed ... as a deduction pursuant to Section 166 of the Internal Revenue Code ... may be credited upon subsequent reports and remittances of the tax levied in this article, in accordance with the rules and regulations of the Tax Commission. If such accounts are thereafter collected, the same shall be reported and the tax shall be paid upon the amount so collected.’ ”

198 P.3d at 903. The court gave the same construction to this statute as we presently give to the Department’s bad-debt regulation. Specifically, it held that a retailer, to be entitled to a refund of sales tax under the statute, must have been the entity that deducted the bad debt on its income-tax returns:

“[The taxpayer] could not satisfy its burden of proving a right to a refund of sales tax under that statute. Section 1366 implicitly requires the owner of the bad debt account to be the entity allowed the deduction where it also requires the owner to report subsequent collections of bad debt accounts as income.”

198 P.3d at 904 (emphasis added). See also Home Depot USA, Inc. v. State Dep’t of Revenue, 151 Wash.App. 909, 922, 215 P.3d 222, 228-29 (2009) (construing a similar tax-refund statute under similar facts and concluding that, “[ajlthough the tax refund statute at issue does not explicitly contain a requirement that bad debts be deductible by the refund claimant, analysis of related federal and state tax laws demonstrates that the party seeking the deduction must be the one holding the bad debt as well as the one to whom repayment on such a debt would be made”).

Furthermore, our conclusion as to the proper construction of the bad-debt regulation follows logically from this court’s decision in Wells Fargo. In that case, several companies (“the credit companies”) financed the sales by multiple retailers of a number of different items. The items were sold on credit pursuant to installment sales contracts entered into between the retailers and their customers. The retailers then assigned the contracts to the credit companies in exchange for payment from the credit companies of the entire amount of the purchase plus applicable sales tax, after which the retailers remitted the sales tax collected to the Department. After a number of customers failed to pay for their purchases under the installment sales contracts, the credit companies, pursuant to the bad-debt regulation, sought refunds of the amount of sales tax they had paid on those contracts. The Department denied the refunds. The circuit court reversed that denial and awarded the credit companies the requested refunds. The Department appealed to this court.

On appeal, this court rejected the credit companies’ argument that the assignment of rights under the installment sales contracts to the credit companies included an assignment to them of any rights the retailers would have had to refunds pursuant to the bad-debt regulation. Wells Fargo, 19 So.3d at 897-99. Instead, we concluded that such rights were not subject to assignment. Id. We also concluded that, even if the right to a refund under the bad-debt regulation was amenable to assignment, such a right did not exist in that case:

“In each transaction, at the time of the assignment of the installment sales contract and all the rights thereunder, the retailer received the full purchase price and all the sales tax due on the retail sale. No other payments were due to the retailer from the purchaser or the credit company. The retail sale, as far as the retailer was concerned, was concluded. The retailer was required to report the proceeds from that retail sale and to compute and remit the sales tax due on that retail sale on its monthly sales-tax report. §§ 40-23-7 & -8. The retailer, at the time of the assignment of the installment sales contract, did not have the potential for and would never have the potential for an uncol-lectible account arising from that reported retail sale. The sales tax collected on that retail sale and remitted to the Department was not an overpayment of tax, because sales tax was due on the entire purchase price when it was paid to the retailer. §§ 40-2B-7 & -8. The retailer’s ‘right’ to a refund under the ‘bad debt’ regulation was not a contingent right that could be assigned; it was a right that never came into being and would never come into being. The retailer would never qualify for a refund under the ‘bad debt’ regulation because it did not pay sales tax on installments due on a credit account; instead, it received the entire purchase price at the time of the retail sale, which required the payment of all sales tax due at that time. See Department of Revenue v. Bank of America, NA., 752 So.2d [637] at 642 [ (Fla.Dist.Ct.App.2000) ]; In re Petition of General Elec. Capital Corp. (DTA No. 816785, Dec. 27, 2001) (N.Y. Tax App. Trib.2001) (not published); see also 29 Richard A. Lord, Williston on Contracts § 74:1, at 206 (4th ed.2003) (stating, in a discussion of assignments of a chose in action, that ‘the assignee acquires rights similar to those of the assignor, and is put in the same position with reference to those rights as that in which the assignor stood at the time of the assignment’).”

Id. at 899.

Home Depot seeks to distinguish Wells Fargo on the basis that, unlike the retailers in that case, Home Depot “did not receive the full purchase price plus sales tax for [the] PLCC transactions.” This, in our view, is an immaterial distinction. The ALJ rejected any notion that Home Depot’s payment of a service fee to the finance companies (and, therefore, its receipt of less than the entire purchase price of the financed purchases) conferred on Home Depot a right to seek a refund under the bad-debt regulation:

“Home Depot argues in the alternative that it is entitled to a refund because a bad debt component was included in the fees it paid to the [finance companies], and consequently, it suffered the economic loss for the bad debts. Home Depot claims that it ‘fully compensated [the finance companies] for worthless (Home Depot card) accounts through the service fee and other consideration.’ Home Depot’s Post-Hearing Brief at 21. I disagree.
“The agreements between Home Depot and the [finance companies] included only the fee percentages, and did not specify how the percentages were determined. Several witnesses testified, however, that the parties estimated and considered the expected bad debt amounts when negotiating the fee amounts. But there is no evidence showing the amount or what part of the fees constituted a bad debt component. Consequently, there is no proof that the fees included a bad debt component that fully compensated the [finance companies] for the actual bad debts.
“Even if it is assumed that the fees included a bad debt component equal to the estimated bad debt amounts, which, as discussed, cannot be established, the bad debts actually incurred by the [finance companies] may have been (or could be in the future) much greater than anticipated. For example, assume that the [finance companies] estimated that during a given period x amount of the accounts would become uncollectible. Assume further that it included that x amount as a bad debt component in the fees. Due to an unexpected economic downturn, however, the actual bad debt amount was xxx. Applying Home Depot’s rationale, it would be entitled to a sales tax refund based on xxx amount, even though it had paid the [finance companies] a bad debt component in the fee, i.e., had suffered an economic loss, of only x amount. Clearly, that cannot be allowed.
“Home Depot asserts that the fees fully compensated the [finance companies] for the bad debts because the [finance companies] ‘covered all its costs and earned a profit during the period in issue.’ Home Depot’s Post-Hearing Brief at 21. As discussed, however, the fees received from Home Depot were only one source of income for the [finance companies]. They also received substantial interest income and late fees from their cardholders. Consequently, the fact that the [finance companies] made a profit during the subject period does not establish, or even suggest, that Home Depot fully compensated the [finance companies] for the expected bad debts. In short, there is nothing proving the amount of the bad debt component included in the fees, and nothing tying that undeterminable amount to the actual bad debts incurred by the [finance companies].”

(Footnote omitted.) We agree with the ALJ’s conclusion that there is simply no evidence demonstrating that Home Depot’s payment of the service fee to the finance companies compensated the finance companies in full, or even in substantial part, for their bad-debt losses. Thus, we cannot agree with Home Depot that its failure to receive the full purchase price for its sales under the PLCC program because of its payment of a service fee to the finance companies sufficiently distinguishes this case from Wells Fargo so as to confer on Home Depot an entitlement to a refund of sales tax that, in Wells Fargo, we said did not exist under the bad-debt regulation.

Home Depot contends that the denial of a refund in this case based on the Department’s construction of the bad-debt regulation would violate the Equal Protection Clause of the United States Constitution, U.S. Const. amend. XIV, § 1. Specifically, it argues that there is no rational basis for drawing a distinction under the bad-debt regulation between a retailer that finances its own credit-card program and one that, like Home Depot, enters into agreements with other companies for those companies to provide the financing for its customers’ purchases. The Department responds that Home Depot is not similarly situated to retailers that finance their customers’ purchases and that there are sound policy reasons for distinguishing between such retailers and Home Depot with regard to the application of the bad-debt regulation.

As to equal-protection challenges to tax laws, our supreme court has written that “[a] party challenging a tax statute as unconstitutionally discriminatory must show that the discrimination embodied in the taxing statute is unreasonable and must negate every factor offered as a reasonable basis supporting the classification.” State v. Alabama Mun. Ins. Coi~p., 730 So.2d 107, 111 (Ala.1998). “Taxpayers arguing that a state taxation statute violates the Equal Protection Clause of the Federal Constitution carry a heavy burden.” Id. at 112.

We agree with the Department that Home Depot is not similarly situated to other retailers that finance and administer their own credit programs. Unlike such retailers, Home Depot received the purchase price at the time purchases were made under the PLCC program, not in increments over time. Moreover, because Home Depot was not required to refund to the finance companies the purchase price for purchases for which its customers under the PLCC program did not pay the finance companies, Home Depot bore no risk of its customers’ defaults whatsoever. Simply put, Home Depot was not affected in any discernible way at the time its customers utilizing the PLCC program failed to pay the finance companies for their purchases. Thus, we cannot conclude that, with regard to sales-tax refunds, the differing treatment of Home Depot and other retailers that provide their own financing for purchases is irrational or in any way unfair. In this regard, we agree with the Supreme Court of Ohio, which rejected Home Depot’s equal-protection argument in a case involving the same circumstances as those in the present case:

“First, Home Depot contends that the guarantee of equal protection in the Untied States and Ohio Constitutions require that it be treated the same as those vendors who themselves extend credit to their customers. Under the statute, the latter qualify for the bad-debt deduction.
“This argument fails because vendors who extend credit themselves are not, with respect to bad debt, similarly situated to vendors like Home Depot, who hire financial institutions to extend credit. That is so because, as already discussed, vendors that extend credit themselves assume the risk of loss along with the other burdens of lending and collecting. As the testimony in this case establishes, Home Depot avoided such burdens when it hired GE to issue private-label credit cards. Quite simply, there is no requirement of equal treatment of differently situated persons.”

Home Depot USA, Inc. v. Levin, 121 Ohio St.3d 482, 486, 905 N.E.2d 630, 634 (2009). See also Home Depot USA, Inc. v. State Dep’t of Revenue, 151 Wash.App. at 926-29, 215 P.3d at 230-32 (rejecting Home Depot’s equal-protection challenge in a case involving the same issue as the present case); In re Sales Tax Claim for Refund of Home Depot, 198 P.3d at 905 (same); and Home Depot U.S.A., Inc. v. Indiana Dep’t of State Revenue, 891 N.E.2d 187, 191 n. 7 (Ind. Tax Ct.2008) (same).

Home Depot also contends that the Department’s construction of the bad-debt regulation violates the Due Process Clause of the Fourteenth Amendment to the United States Constitution, U.S. Const. amend. XIV, § 1, and the guaranty of due process contained in the Alabama Constitution, Ala. Const.1901, Art. I, § 6. Specifically, it argues that “allowing the Department to retain sales tax payments on defaulted transactions, and denying the aggrieved retailer any relief, in effect transforms the State’s sales tax into a tax on consumer defaults” and that, “[wjhen a consumer defaults on a credit card account, there is no legitimate rationale or basis for imposing a tax on the retailer with respect to that transaction.”

State tax provisions do not violate due process unless they are arbitrary and irrational. See Usery v. Turner Elkhorn Mining Co., 428 U.S. 1, 15, 96 S.Ct. 2882, 49 L.Ed.2d 752 (1976) (“It is by now well established that legislative Acts adjusting the burdens and benefits of economic life come to the Court with a presumption of constitutionality, and that the burden is on one complaining of a due process violation to establish that the legislature has acted in an arbitrary and irrational way.”). We conclude that the Department’s interpretation of the bad-debt regulation is neither arbitrary nor irrational. Particularly, as stated above with regard to Home Depot’s equal-protection challenge, we find that retailers that establish credit accounts for their customers and bear the risk of loss on those accounts are in a much different position than retailers that, like Home Depot, are paid up front for all purchases made by their customers and do not bear any risk of default on those purchases. The refusal of the Department to provide a refund of sales taxes paid by the latter group of retailers is imminently reasonable, given that those retailers did not bear the risk of loss with regard to credit payments and that the amount those retailers were paid for the purchases, including applicable sales taxes, does not dimmish on the basis of their customers’ default on their credit accounts. We note that this court is not the only court to reject Home Depot’s due-process challenge under virtually identical facts. See, e.g., Home Depot USA, Inc. v. Levin, 121 Ohio St.3d at 487, 905 N.E.2d at 634-35; and Home Depot USA, Inc. v. State Dep’t of Revenue, 151 Wash.App. at 929, 215 P.3d at 232.

Finally, Home Depot argues that to deny a refund in this case would result in unjust enrichment to the State of Alabama because, according to Home Depot, it paid sales taxes on goods for which, ultimately, its customers failed to pay. We disagree. The transactions giving rise to the refund petition in this case constituted completed sales with regard to Home Depot. Home Depot’s customers received the object of the purchase, and Home Depot was paid for the purchase. The customers’ failure to pay the financing companies for their purchases did not in any way change the fact that Home Depot was paid for the purchases, and there is no evidence in the record indicating that Home Depot refunded the purchase price to the financing companies and recovered the items for which the purchaser failed to pay. Thus, if anything, awarding Home Depot the refund that it seeks in this case would result in unjust enrichment to Home Depot.

Based on the foregoing, we conclude that the Department’s bad-debt regulation did not provide a basis on which to grant Home Depot’s petition for a refund of sales tax. As a result, we reverse the circuit court’s judgment, and we remand the cause for the entry of a judgment affirming the Department’s denial of Home Depot’s refund petition.

REVERSED AND REMANDED WITH INSTRUCTIONS.

PITTMAN, BRYAN, THOMAS, and MOORE, JJ., concur.

      . Tim Russell, the former Commissioner of Revenue of the State of Alabama, was a party to the action in the circuit court in his official capacity. Magee, the current commissioner, was substituted for Russell. See Rule 43(b), Ala. R.App. P.

      . The finance companies were permitted under the contracts to charge back accounts to Home Depot under limited circumstances. Simply incurring a loss from a customer’s failure to pay on an account was not one of those circumstances.

      . Neither party contends that the due-process guaranty of the Alabama Constitution calls for a different analysis in the present case than the analysis called for under the Due Process Clause of the Fourteenth Amendment to the United States Constitution.