author: BOLIN, Justice. LYONS, Justice

text:
    Ex parte Theresa LAWSON d/b/a The Design Company. (In re Theresa Lawson d/b/a The Design Company v. Brian Homes, Inc., et al.)
    1060206.
    Supreme Court of Alabama.
    July 18, 2008.

      Gregory A. Reeves of Edwards, Mitchell & Reeves, Decatur; and Robert H. Harris of Harris, Caddell & Shanks, P.C., Decatur, for petitioner.
    Guy V. Martin, Jr., of Martin, Rawson & Woosley, P.C., Birmingham, for respondents Wells Fargo Home Mortgage, Inc., Chase Manhattan Mortgage Corporation, Countrywide Home Loans, Inc., and Full Spectrum Lending, Inc.
   BOLIN, Justice.

Theresa Lawson d/b/a The Design Company (“Lawson”) petitioned this Court for a writ of certiorari to review the Court of Civil Appeals’ opinion in Lawson v. Brian Homes, Inc., 6 So.3d 1 (Ala.Civ.App.2006). Lawson asked this Court to review whether the Court of Civil Appeals’ opinion conflicts with prior decisions of this Court and the Court of Civil Appeals regarding equitable subrogation. We granted the writ on this ground.

Facts and Procedural History

The Court of Civil Appeals’ opinion sets out the facts as follows:

“Brian Homes, Inc. (‘Brian Homes’), a home-building company, developed certain parcels of property in Madison County by building single-family residences on those parcels. On June 20, 2003, Brian Homes obtained a construction loan secured by a mortgage upon those parcels (‘the senior mortgage’) from New South Federal Savings Bank. Theresa Lawson, who does business as The Design Company (‘Lawson’), performed subcontractor work for Brian Homes, installing carpet, tile, and marble flooring in numerous residences. In January 2004, the construction loan secured by the senior mortgage was paid in full with the proceeds of loans made on behalf of the ultimate occupiers of the constructed houses (‘the purchasers’) by Wells Fargo Home Mortgage, Inc.; Chase Manhattan Mortgage Corporation; Countrywide Home Loans, Inc.; and Full Spectrum Lending, Inc. (‘the lenders’).1 At the time that the construction loan was paid in full, no mate-rialman’s liens had been recorded as to any of the parcels. In fact, it is undisputed that the lenders had no notice of a junior or secondary lien at the time they provided the funds to satisfy the loan secured by the senior mortgage. Lawson perfected materialman’s liens as to the seven parcels at issue during the spring of 2004, and in August 2004 she filed multiple actions against the lenders and the purchasers to enforce those liens. The time line of each of the seven actions is marginally different from the others, but the priority issues are the same in all seven cases.
“In each of the cases, the sequence of events is substantially the same: New South Federal Savings Bank held a first mortgage on each parcel on which a house was to be built by Brian Homes and its subcontractors. Lawson then provided material and labor to complete the flooring as to each house. Shortly after the completion of Lawson’s work, Brian Homes sold each separate parcel of property to one of the purchasers, who acted in good faith and had no notice of the existence of Lawson’s potential lien. After Brian Homes had failed to pay Lawson with proceeds from those sales, Lawson attempted to perfect liens as to each parcel.2 The filing and recording of those liens occurred after the recording of the senior mortgage and after the recording of the lenders’ mortgages. In each action, Lawson asserted that her lien took priority over the lenders’ mortgages pursuant to § 85-11-211, Ala.Code 1975, and she requested that the trial court order the sale of each of those parcels in order to pay Lawson the amount due on each lien.
“The lenders filed summary-judgment motions in each of Lawson’s actions to enforce the liens; in those motions, the lenders ai’gued that either Lawson’s liens did not have priority over the lenders’ mortgages or that the lenders were due to be equitably subrogated as to the senior mortgage. Lawson, relying on this court’s decision in Collateral Investment Co. v. Pilgrim, 421 So.2d 1274 (Ala.Civ.App.1982), opposed the lenders’ motions and filed her own summary-judgment motion in each action.
“The trial court entered summary judgments in favor of the lenders and the purchasers in all of Lawson’s lien-enforcement actions, noting that Lawson might otherwise have priority pursuant to § 35-11-211, AIa.Code 1975 (the ma-terialman’s lien priority statute), but that, in each case at issue, the lenders were equitably subrogated to the first-priority position of the senior mortgage.3 Lawson appeals and asserts that the trial court erred in failing to correctly apply § 35-11-211, Ala.Code 1975, and the holding in Pilgrim.
“The primary question on appeal is whether the trial' court could properly enter a summary judgment against Lawson in each of her actions seeking to force a sale of the pertinent parcel of property in order to enforce her lien. In each case, Lawson and the current homeowners and the lenders agreed to accept the trial court’s judgment without a hearing and based upon the pleadings and exhibits, and, in each case, the trial court determined that despite Lawson’s statutory-priority argument, her position was secondary to that of the lenders, who were held to be entitled to equitable subrogation as to the senior mortgage.
“1 Although Lawson named the purchasers of each parcel in her seven complaints, the purchasers are not parties to this appeal.
“2 The record contains detailed statements concerning the total amount that Brian Homes owed Lawson; although that total was over $425,000, the liens involved in these appeals range in value from $5,500 to $10,800.
“3 The trial court entered a Rule 54(b), Ala. R. Civ. P., order at the same time that it entered the summary judgments in these cases; each judgment also noted that ‘[tjhis judgment does not establish the existence of a lien in favor of [Lawson], which issue is reserved for trial.’ ”

Lawson, 6 So.3d at 2-3.

The Court of Civil Appeals concluded that Wells Fargo Home Mortgage, Inc., Chase Manhatten Mortgage Corporation, Countrywide Home Loans, Inc., and Fall Spectrum Lending, Inc. (“the lenders”), all of whom loaned money to the homeowners to purchase their homes, had established all the elements necessary to invoke the doctrine of equitable subrogation. Lawson conceded that her materialman’s liens were subordinate to the mortgage held by New South Federal Savings Bank, which financed Brian Homes’ construction loan (“the senior mortgage”). The lenders had satisfied the senior mortgage without actual notice of the materialman’s liens claimed by Lawson and, therefore, the Court of Civil Appeals reasoned, should be treated as assignees of the senior mortgage. The Court of Civil Appeals further held that that result was not inequitable because it leaves Lawson in the same position she occupied at the time she supplied the materials and labor to Brian Homes and that the application of the doctrine of equitable subrogation will not change the priority of her liens because she started in a subordinate position.

The Court of Civil Appeals stated that although the materialman’s lien statutes, §§ 35-11-210 through 35-11-234, Ala. Code 1975, provide subcontractors the opportunity and procedure by which to perfect liens against property to which improvements have been made, those statutes do not guarantee that such liens will not be subject to equitable subrogation when the facts and equity require it. In reaching its conclusion, the Court of Civil Appeals overruled Collateral Investment Co. v. Pilgrim, 421 So.2d 1274 (Ala.Civ.App.1982). It stated:

“The construction industry today relies on banks and mortgage lenders to provide both initial construction-loan moneys to underwrite the construction of new houses and other buildings as well as purchase-money loans to prospective individual buyers of those completed structures. In a completely honest and fair world, every developer, contractor, and subcontractor would be paid for his or her work from the proceeds of the sale of the property to the ultimate purchaser. However, if we were to accept Lawson’s argument that the materialman’s lien statute gives her liens priority over the lenders’ purchase-money mortgages, all unpaid subcontractors who perfected ma-terialman’s liens as to these pertinent properties will receive an immediate windfall by forcing the sale of the residences, leaving the lenders (and the purchasers) without recourse. The doctrine of equitable subrogation therefore selves a remedial purpose in this context, and we conclude that the trial court’s application of that doctrine in these cases is consistent with cases decided since Pilgrim that discuss the doctrine.”

Lawson v. Brian Homes, 6 So.3d at 5-6.

Standard of Review

“On certiorari review, this Court accords no presumption of correctness to the legal conclusions of the intermediate appellate court. Therefore, we must apply de novo the standard of review that was applicable in the Court of Civil Appeals.” Ex parte Toyota Motor Corp., 684 So.2d 132, 135 (Ala.1996). We are reviewing the Court of Civil Appeals’ affirmance of summary judgments. “The law is well established that a de novo standard applies to appellate review of a trial court’s summary judgment.” Ex parte Patel, 988 So.2d 957, 959 (Ala.2007).

Analysis

The dispositive issue before us is whether the Court of Civil Appeals properly applied the doctrine of equitable subrogation to hold that the lenders’ loans are subrogated to the priority position of the senior mortgage held by the construction lender even though there was an intervening materialman’s lien.

In Bailey Mortgage Co. v. Gobble-Fite Lumber Co., 565 So.2d 138 (Ala.1990), this Court set out the history of mechanic’s liens and materialman’s liens. In 1791, Maryland passed the first mechanic’s lien law. In 1821, Alabama enacted its first mechanic’s lien statute for the protection of materialmen and mechanics. The section of the statute regarding priorities remained virtually unchanged until 1933. Before 1933, a materialman had an advantage over a lender. The material-man had absolute priority. Following pleas from construction lenders, the legislature in 1933 amended the priority section of the mechanic’s lien statute. The effect of the 1933 amendment was to reverse the priorities between a materialman’s lien and a prior recorded mortgage. However, the legislature made it clear that a material-man’s lien had “priority over all other liens, mortgages or incumbrances created subsequent to the commencement of work on the building or improvement .... ” Act No. 64, Ala. Acts 1933, Ex.Sess. (emphasis added). Today, § 35-ll-211(a) still provides, in pertinent part, that “[sjuch lien as to the land and buildings or improvements thereon, shall have priority over all other liens, mortgages or incumbrances created subsequent to the commencement of work on the buildings or improvement. ...”

“[A materialman’s] lien comes into existence immediately when one provides any materials or performs labor upon the property but remains inchoate unless a statement of lien is timely filed with the judge of probate of the county in which the property is situated (§ 35-11-213), and unless suit is timely filed to perfect the [materialman’s] lien (§ 35-11-221). Once these two steps are timely undertaken, the lien relates back to the date that the materials or labor was provided, and the priority of the lien is determined according to § 85-11-211. Such a lien has priority over encumbrances attaching after the commencement of the work.”

Greene v. Thompson, 554 So.2d 376, 379 (Ala.1989) (citations and footnotes omitted).

This Court has long recognized the doctrine of equitable subrogation. See, e.g., Bolman v. Lohman, 74 Ala. 507, 512 (1883) (“[W]here money is expressly advanced in order to extinguish a prior incumbrance, and is used for this purpose, with the just expectation on the part of the lender of obtaining a valid security; or where its payment is secured by a mortgage, which for any reason is adjudged to be defective, the lender or mortgagee may be subrogat-ed to the rights of the of the prior incum-brancer, whose claim he has satisfied, there being no intervening equity to prevent. ... So, where there is misrepresentation and fraud, by which one has been induced to advance money to discharge a lien on property, and the money is so appropriated, it is common for equity to protect the lender, by subrogating him to the lien which his money has been used to extinguish.”).

The elements of the doctrine of equitable subrogation are:

“(1) [T]he money is advanced at the instance of the debtor in order to extinguish a prior incumbrance; (2) the money is used for that purpose with the just expectation on the part of the lender for obtaining security of equal dignity with the prior incumbrance; (3) the whole debt must be paid before subrogation can be enforced; (4) the lender must be ignorant of the intervening lien; and (5) the intervening lienor must not be burdened or embarrassed.”

Pilgrim, 421 So.2d at 1276.

The Court of Civil Appeals has addressed the application of the doctrine of equitable subrogation when the intervening lien was a materialman’s lien. In Pilgrim, the Court of Civil Appeals held that a materialman’s lien had a priority position over a mortgage company that held a purchase-money mortgage on the property after paying off a construction mortgage. In Pilgrim, a construction company executed construction-money mortgages on town-homes on the real property in question. The materialman supplied lighting equipment and related fixtures for the construction project. The townhome owners purchased the finished townhomes. The mortgage company loaned the townhome owners money in exchange for a purchase-money mortgage on the townhomes. The attorneys for the mortgage company examined a title abstract and found no mate-rialman’s liens. Additionally, the construction company and the mortgage company signed an affidavit at closing stating that all moneys owed to materialmen had been paid. However, the materialman in question had not been paid, and he filed a verified statement of lien. The trial court concluded that the materialman’s lien had priority over the mortgage company’s purchase-money mortgage.

The mortgage company appealed. The Court of Civil Appeals in Pilgnm noted that the construction-money mortgage had been executed before the materialman supplied any materials to the job site and that, as a result, it was undisputed that the construction-money mortgage had priority over the materialman’s lien. The mortgage company satisfied the construction-money moi'tgage and argued that by satisfying that mortgage, it should now be allowed to claim first priority under the doctrine of equitable subrogation. The Court of Civil Appeals affirmed the judgment of the trial court on two grounds. First, it held that the mortgage company did not meet the first element of equitable subrogation because the money had not been advanced at the instance of the debtor to satisfy the prior mortgage. In other words, the mortgage company loaned the money to the townhome owners based on their individual credit. The money was not loaned for the express purpose of satisfying the construction-money mortgage. The mortgage company ordered that the closing attorney pay the construction-money mortgage for its own benefit, and not for the benefit of the debtor, i.e., the construction company. Second, the Court of Civil Appeals held that the mortgage company did not meet the fourth element of equitable subrogation. The mortgage company was satisfying a construction-money mortgage for new homes, and it had constructive notice that by statute materialmen had six months within which to file liens. The mortgage company was not ignorant of the materialman’s lien; therefore, another element of equitable subrogation was not met.

In the present case, instead of following its decision in Pilgrim,, the Court of Civil Appeals overruled Pilgrim and relied upon three cases from this Court that applied the doctrine of equitable subrogation. See Brooks v. Resolution Trust Corp., 599 So.2d 1163 (Ala.1992)(granting the purchasers’ request for equitable subrogation where the purchasers discharged a debt to the senior lienholder without knowledge that an intermediate vendor had mortgaged the property to a junior lienholder); Whitson v. Metropolitan Life Ins. Co., 225 Ala. 262, 142 So. 564 (1932)(imposing equitable subrogation upon a showing of lack of actual knowledge by the party paying to discharge a prior incumbrance at the debt- or’s instance); and Shields v. Hightower, 214 Ala. 608, 108 So. 525 (1926)(holding that purchasers of real estate from a tax collector, who satisfied, with part of the purchase money, a mortgage that had been given prior to the execution of the tax collector’s bond, are entitled to subrogation to the rights of the mortgagee as against the lien of the bond despite being charged by law with notice of the tax collector’s lien). However, none of these cases involved a materialman’s lien.

In the present case, all the elements of the doctrine of equitable subrogation have not been met. The first element of equitable subrogation is that “the money is advanced at the instance of the debt- or in order to extinguish a prior incum-brance.” Pilgrim, 421 So.2d at 1276. In his dissent in Lawson v. Brian Homes, Judge Murdock stated:

“The second loans, which the main opinion believes should be subrogated to the developer’s construction loan, were not made to the original debtor. That is, they were not made to the developer. Rather, they were made to the ultimate purchasers of the houses. Also, the second loans were made to the ultimate purchasers not for the direct purposes of extinguishing any prior encumbrance, but rather for the purpose of enabling the purchasers to make their purchases of the houses. Although the moneys from these second loans were loan proceeds in the hands of the purchasers, they merely constituted payments by the purchasers to the developer. Under the majority’s analysis, the lien of a material’s supplier properly recorded under our statutes would become all but meaningless whenever a house is purchased by a purchaser who utilizes loan proceeds to pay the builder or developer for the house and the builder or developer, in turn, upon being paid for the house by the purchaser, uses the proceeds of the sale of pay off its construction loan.”

6 So.3d at 6-7. We agree.

Additionally, the fourth element of equitable subrogation has not been met. That is, the lender must be ignorant of the intervening lien. In the present case, the Court of Civil Appeals concluded that the lenders satisfied the senior mortgage without actual notice of the materialman’s liens claimed by Lawson and that, therefore, the lenders should be treated as assignees of the senior mortgage.

This Court has addressed notice in the context of materialman’s liens. In Starek v. TKW, Inc., 410 So.2d 35 (Ala.1982), overruled on other grounds, Ex parte Grubbs, 571 So.2d 1119 (Ala.1990), the purchasers bought a house from a builder. The purchasers obtained a mortgage from a lending company in order to buy the house. Unknown to the purchasers, the builder had failed to pay one of its suppliers that had provided materials for the construction of the house, even though the builder had signed an affidavit stating that he had paid all materialmen. The builder filed a petition in bankruptcy. The unpaid supplier filed a lien against the property. This Court noted that although the general rule of law protects a purchaser who is without notice of the existence of a lien, a lien filed on a new building does have priority over a purchaser, regardless of actual notice. “This is true because a purchaser of a new building has constructive notice that material used to build the structure may not be paid for. Therefore, one who purchases a new home prior to the running of the six-month statute of limitations is put on constructive notice that the filing of a lien is still statutorily permissible.” 410 So.2d at 36-37 (emphasis added).

We hold that the constructive notice supplied by the materialman’s lien statute defeats the lenders’ equitable-sub-rogation claim. The materialman’s lien statutes “are an expression of legislative intent that should stay the hand of equity in this situation. If we held otherwise, we would violate the equitable maxim that equity follows the law.” Richards v. Security Pacific Nat’l Bank, 849 P.2d 606, 611 (Utah Ct.App.1993) (holding that under Utah’s mechanic’s lien statute a subsequent lender had constructive notice of the intervening mechanic’s lien so that the subsequent lender was not entitled to use the doctrine of equitable subrogation to defeat the mechanic’s lien). In determining the meaning of a statute, this Court looks to the plain meaning of the words as written by the legislature, and the legislature, in § 35-11-211, clearly stated that a materialman’s “lien as to the land and buildings or improvements thereon, shall have priority over all other liens, mortgages or incumbrances created subsequent to the commencement of the work on the building or improvement.” (Emphasis added.)

In Bank of America, N.A. v. Prestance Corp., 160 Wash.2d 560, 160 P.3d 17 (2007), the Washington Supreme Court held, as a matter of first impression, that it would adopt the approach of the Restatement (Third) of the Law of Property § 7.6 (1997), under which a refinancing mortgagee’s actual or constructive knowledge of intervening liens does not automatically preclude a court from applying the doctrine of equitable subrogation. The Washington court quoted with approval from Ex parte AmSouth Mortgage Co., 679 So.2d 251, 255-56 (Ala.1996), the following: “ ‘If all persons who negligently confer an economic benefit upon another are disqualified from equitable relief because of their negligence, then the law of restitution, which was conceived in order to prevent unjust enrichment, would be of little or no value’ ” and “ ‘ “[0]ne is not penalized for lack of care unless this results in harm to someone else” ’ ’’(quoting Restatement of the Law of Restitution § 59 cmts. at 232 (1937)).

We are aware of the approach in the Restatement, but it is not necessary for this Court to embrace that approach in this case because a mechanic’s/material-man’s lien falls within an exception as set out in the Restatement Illustration no. 30, Restatement (Third) of the Law of Property § 7.6, cmt. f (1997), provides:

“30. Mortgagor owns Blackaere subject to a mortgage held by Mortgagee-1. Mortgagor obtains a loan from Mortgagee-2 for the purpose of discharging Mortgagee-l’s mortgage. Mortgagee-2 makes the loan and disburses the proceeds to pay and discharge Mortgagee-l’s mortgage. A satisfaction of Mortgagee-l’s mortgage is recorded in the public records. However, Mortgagee-2’s mortgage is not recorded until several days later. During the period between recordation of the satisfaction and the new mortgage, Mechanic, a contractor hired by Mortgagor, commences work under a contract to build a house on Blackaere. Mortgagor fails to pay Mechanic, who records a notice of mechanics lien on Blackaere. Under applicable law, such liens take their priority from the date work on the contract commenced. A court is warranted in finding that a grant of subrogation to Mortgagee-2 would be unjust to Mechanic, and upon such a finding may deny Mortgagee's subrogation claim.”

The Court of Civil Appeals contends that Lawson would be receiving a “windfall” if the lenders’ purchase-money mortgages were not subrogated to the builder’s construction loan. If we held against Lawson, however, the builder would receive the windfall. The builder would have the value of Lawson’s work without having paid anything for it. The legislature created a specific statutory scheme in which a materialman’s lien is given priority over a subsequently created mortgage. The lenders who loaned the money to the purchasers in the present case are sophisticated mortgage companies that could have easily protected their interests. Based on the statutory preference given to material-men, it is the commercial lenders who bear the burden of protecting themselves.

Conclusion

The judgment of the Court of Civil Appeals is reversed, and the cause is remanded for proceedings consistent with this opinion.

REVERSED AND REMANDED.

COBB, C.J., and SEE, WOODALL, STUART, SMITH, and PARKER, JJ„ concur.

LYONS, J., concurs in part and concurs in the result.

MURDOCK, J., recuses himself.

LYONS, Justice

(concurring in part and concurring in the result).

I concur based on the recognition in the main opinion of the statutory mandate for priority of liens over subsequent encumbrances as set forth in § 35-ll-211(a), Ala.Code 1975, and the obligation of equity to follow the law. See Moulton v. Reid, 54 Ala. 820, 324 (1875) (“Equity follows the law, and ‘when a rule, either of common, or statute law, is direct, and governs the ease with all its circumstances, or the particular point, a court of equity is as much bound by it as a court of law, and can as little justify a departure from it.’ — 1 Story’s Eq. § 64.” (cited with approval in Turner v. Cooper, 347 So.2d 1339, 1346-47 (Ala.1977))).

I concur in the result as to the discussion in the main opinion of the Restatement of the Law of Restitution § 59 (1937). I would conclude that it is simply unnecessary to decide in this case whether the principles there announced are sound and susceptible of application, notwithstanding § 35-ll-211(a), because, even if we were to embrace them, illustration no. 30 of the Restatement (Third) of the Law of Property § 7.6, cmt. f (1997), quoted in the main opinion, recognizes this Court’s authority to deny equitable subrogation to a mortgagee so as to prevent unfairness to a holder of a mechanic’s lien. The unfairness in this proceeding stems from the status of a mechanic’s lienholder when subordinated to a construction mortgage with an indebtedness of limited duration being substantially more advantageous to the lienholder than subordination to the typical purchase-money mortgage authorizing repayment over a term of many years.

      . In AmSouth Mortgage, a mother bought a house for the use and benefit of her daughter, paying off the seller’s equity and assuming an existing mortgage. The mother and daughter understood that as soon as she was able, the daughter would refinance the loan in her own name. Subsequently, the daughter applied for a loan from AmSouth, and the mother’s mortgagor paid off the mother's loan. As part of the refinancing, the mother executed a warranty deed conveying title to herself and the daughter. However, as a result of the closing attorney's negligence, only the daughter signed the new note and mortgage from AmSouth. Less than a month after the closing, the daughter died, and the mother claimed to be the owner of an undivided one-half interest in the property as a tenant in common. She sued AmSouth, seeking a sale of the property and a division of the proceeds. The trial court determined that the mother was the sole owner of the property but that her ownership was subject to a mortgage in favor of AmSouth. The Court of Civil Appeals reversed the trial court's judgment, holding that because AmSouth (through its attorney) had been negligent and the mother was free from fault, AmSouth was not entitled to a mortgage on the property. The Court of Civil Appeals also concluded that the mother owned an undivided one-half interest in the property. This Court reversed the judgment of the Court of Civil Appeals, holding that AmSouth's negligence in failing to discover that the mother was a orte-half owner of the property and in failing to have the mother sign the new mortgage did not bar restitution.

      . The lenders argue that the subcontractors could have protected themselves by “(1) a credit check on the general contractor; (2) agreement with the contractor's lender to require joint checks to the subcontractor and the contractor for work done by the subcontractor; (3) escrow of earmarking of loan funds for the benefit of the subcontractor; (4) mortgage on the personal residence of the contractor; (5) letters of credit; (6) payment bond; (7) individual guarantees from principals of the contractor; (8) advances from the contractor for work or materials; and (9) criminal indictments for theft.” (Lenders' brief, p. 16.) It is also true that the lenders could have obtained a subrogation agreement or assumed the rights of the earlier lender by an assignment of the construction mortgage.


source: Caselaw Access Project

author: PITTMAN, Judge.

license: Public Domain

text:
    Theresa LAWSON d/b/a The Design Company v. BRIAN HOMES, INC., et al.
    2040619 to 2040625.
    Court of Civil Appeals of Alabama.
    Oct. 10, 2008.

      Gregory A. Reeves of Edwards, Mitchell & Reeves, Decatur, for appellant.
    Guy V. Martin, Jr., of Martin, Rawson & Woosley, P.C., Birmingham, for appellees Wells Fargo Home Mortgage, Inc., Chase Manhattan Mortgage Corporation, Countrywide Home Loans, Inc., and Full Spectrum Lending, Inc.
   After Remand from the Alabama Supreme Court

PITTMAN, Judge.

The prior judgment of this court that affirmed the Madison Circuit Court has been reversed, and the cause remanded, by the Supreme Court of Alabama. Ex parte Lawson, 6 So.3d 7 (Ala.2008). On remand to this court, and in compliance with the supreme court’s opinion, the judgment of the Madison Circuit Court is reversed, and the cause is remanded for further proceedings consistent with the supreme court’s opinion.

REVERSED AND REMANDED.

THOMPSON, P.J., and BRYAN, THOMAS, and MOORE, JJ., concur.


author: MOORE, Judge.

text:
    John M. SHERMAN v. HENRY MARINE SERVICE, INC.
    2050643.
    Court of Civil Appeals of Alabama.
    May 11, 2007.
    Certiorari Denied Oct. 10, 2008 Alabama Supreme Court 1061245.
    Michael G. Huey of Huey Law Firm, LLC, Mobile, for appellant.

      Brian P. McCarthy and Karen T. Luce of McDowell, Knight, Roedder & Sledge, L.L.C., Mobile, for appellee.
   MOORE, Judge.

John M. Sherman (“the employee”) appeals from a summary judgment in which the Mobile Circuit Court ruled that Henry Marine Service, Inc. (“the employer”), had properly secured its liability for benefits due the employee under the Longshore and Harbor Workers’ Compensation Act (“LHWCA”), 33 U.S.C. § 901 et seq., and was, therefore, immune from maritime tort liability. We affirm.

I.

The undisputed material facts show that the employer hired the employee as a marine mechanic on August 5, 1999. He worked for the next two years under the direct supervision and control of the employer. The employee considered himself to be an employee of the employer, and all the work he performed was for the benefit of the employer. The employer had the right to discharge the employee.

On April 19, 2000, the employer entered into a staff leasing agreement (“the agreement”) with AMS Staff Leasing, Inc. (“AMS”). Pursuant to this agreement, AMS reserved the right to direct and control leased employees assigned to the employer’s work site. AMS also assumed responsibility for the payment of wages to be paid to leased employees; the payment of payroll taxes on leased employees; and the payment for workers’ compensation insurance. In return, the employer agreed to reimburse AMS for all those costs and to pay an additional amount to cover AMS’s other costs and profit.

After the employer entered into this agreement, AMS began treating the employee as a leased employee by directly paying the employee’s wages. AMS would then invoice the employer for an amount that would include the employee’s weekly wages, his payroll taxes, the cost of workers’ compensation insurance premiums to cover the employee, and a charge for the services performed by AMS. The employer would then pay the invoice. Athough AMS acknowledged in the agreement that it had informed all the leased employees of the arrangement, the employee testified that he had never met anyone from AMS or even heard of AMS before the time he met with his lawyer to prepare for his deposition in this case. The employee, therefore, asserted that AMS had not exercised any control or direction over his work.

Pursuant to the agreement, AMS purchased from CNA Insurance Company a workers’ compensation insurance policy that provides insurance for claims arising under the LHWCA. AMS is the named insured under the policy. The policy contains an endorsement that provides:

“This endorsement applies only with respect to bodily injury to your employees while in the course of special or temporary employment by the alternate employer.... Part One (Workers Compensation Insurance) and Part Two (Employers Liability Insurance) will apply as though the alternate employer is insured.”

The policy did not expressly name the employer as an alternate employer or as an additional insured. However, a schedule attached to the endorsement defines the term “alternate employer” as “ALL USERS OF TEMPORARY EMPLOYEES OF THE NAMED INSURED,” situated in Aabama and states that the endorsement is “APPLICABLE TO EMPLOYEES LEASED TO CLIENT COMPANY UNDER AN EMPLOYEE LEASING ARRANGEMENT.” (Capitalization in original.) The endorsement further provides:

“The insurance afforded by this endorsement is not intended to satisfy the alternate employer’s duty to secure its obligations under the workers compensation law. We will not file evidence of this insurance on behalf of the alternate employer with any governmental agency.”

On April 17, 2001, the employee suffered injuries to the fingers of his hand in an accident while working on a vessel owned and operated by the employer, resulting in a period of disability during which the employee was completely unable to work. From the date of the accident through July 2001, AMS continued to pay the employee’s full salary. From August 2001 to April 2003, when the employee was released to return to work, CNA paid the employee temporary-total-disability benefits and medical benefits pursuant to the LHWCA.

The employee subsequently filed an action against the employer seeking damages based on a variety of claims not at issue in this appeal. After those claims were disposed of on motions for summary judgment, the employee amended his complaint to assert that the employer had failed to secure its liability for LHWCA benefits, thereby exposing itself to maritime tort liability under 33 U.S.C. § 905(a). The parties filed cross-motions for a summary judgment on that claim. The trial court granted the employer’s motion and certified the summary judgment as final, pursuant to Rule 54(b), Ala. R. Civ. P. The employee timely appealed from that final judgment.

II.

We review a summary judgment de novo; we apply the same standard the trial court applied. A party moving for a summary judgment must make a prima facie showing “that there is no genuine issue as to any material fact and that [it] is entitled to a judgment as a matter of law.” Rule 56(c)(3), Ala. R. Civ. P.; see Lee v. City of Gadsden, 592 So.2d 1036, 1038 (Ala.1992). If the movant meets this burden, “the burden then shifts to the non-movant to rebut the movant’s prima facie showing by ‘substantial evidence.’ ” Lee, 592 So.2d at 1038. “[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.” West v. Founders Life Assurance Co. of Florida, 547 So.2d 870, 871 (Ala.1989); see Ala.Code 1975, § 12-21-12(d). See also Ex parte General Motors Corp., 769 So.2d 903 (Ala.1999); West, 547 So.2d at 871; and Bass v. SouthTrust Bank of Baldwin County, 538 So.2d 794 (Ala.1989), for further discussion of the application of the summary-judgment standard.

III.

33 U.S.C. § 904(a) requires every employer subject to the LHWCA to “secure the payment to his employees of the compensation payable [under the LHWCA].” 33 U.S.C. § 905(a) provides, in pertinent part:

“The liability of an employer prescribed in section 904 of this title shall be exclusive and in place of all other liability of such employer to the employee ..., except that if an employer fails to secure payment of compensation as required by this chapter, an injured employee ... may elect to claim compensation under the chapter, or to maintain an action at law or in admiralty for damages on account of such injury.... ”

33 U.S.C. § 932(a) prescribes two methods by which an employer may secure its liability under the LHWCA: 1) by obtaining and maintaining insurance with an authorized insurance carrier, or 2) by obtaining authorization to act as a self-insurer.

In this case, the employee asserts that the employer failed to secure its liability for LHWCA benefits under either of the two methods set out in § 932(a), thereby rendering § 905(a) operative and allowing the employee to maintain an action in admiralty for damages on account of his injury. The employee argues that the employer was not named as an additional insured on AMS’s insurance policy and that the schedule contained in the endorsement to AMS’s policy does not cover the employer. The employee further argues that, even if the policy did cover the employer and the employee, by the plain terms of the endorsement the policy did not satisfy the employer’s obligation to secure insurance under the LHWCA.

The employer, on the other hand, asserts that the policy provides LHWCA coverage to it under the terms of the schedule in the endorsement. The employer contends that it was a “user of temporary employees of the named insured,” AMS, and that the employee was a “leased employee” within the terms of an “employee leasing arrangement.” The employer also points out that CNA actually paid the employee all the LHWCA benefits to which he was entitled. These facts, the employer argues, show that, despite the language of the endorsement, it did secure its obligation to provide LHWCA benefits to the employee.

In Hudson v. Forest Oil Corp. (No. Civ. A. 02-2225, April 28, 2003) (E.D.La.2003) (not reported in F.Supp.2d), the court considered the identical issue presented here in a case remarkably similar to this one. In Forest Oil, a labor supply company assigned Terry Hudson to work on an oil production platform for Forest Oil Corporation. Hudson received injuries in the course of his employment for which he received LHWCA benefits through the labor supply company’s workers’ compensation insurance policy, which was funded by Forest Oil. Hudson then filed an action against Forest Oil seeking tort damages for his injuries. Forest Oil defended on the ground that it was immune from tort liability as a borrowing employer that had secured its liability for LHWCA benefits through its arrangement with the labor supply company. Under those facts, the court in Forest Oil held that Forest Oil was a borrowing employer entitled to tort immunity even though it had only indirectly paid for the insurance covering Hudson:

“[I]t is irrelevant for purposes of the instant motion whether or not Forest Oil [i.e., the borrowing employer,] secured payment of workers’ compensation for its borrowed employees. [The labor supply company, i.e., the formal employer,] provided Hudson with compensation benefits through its insurer.... Hudson’s exclusive remedy for the injuries he suffered ... is the workers’ compensation benefits he has already received. Accordingly, [the borrowing employer] is entitled to tort immunity under § 905(a).”

The court thus entered a summary judgment in favor of Forest Oil.

The employee asserts that the holding in Forest Oil relies on a footnote in Melancon v. Amoco Production Co., 834 F.2d 1238, 1247 n. 17 (5th Cir.1988), that has since been discredited by Total Marine Services, Inc. v. Director) Office of Worker’s Compensation Programs, United States Department of Labor, 87 F.3d 774, 779 (5th Cir.1996). However, we note that in Forest Oil the court cited Total Marine and was well aware of the holding in Total Marine that a “formal,” or “lending,” employer who has paid LHWCA benefits may seek indemnification from the “borrowing employer.” The Total Marine decision does not conflict on any material point with the holding in Forest Oil. Therefore, we reject the employee’s attempt to portray Forest Oil as unpersuasive authority on this ground.

The employee has submitted a memorandum opinion in Maxwell v. Carolina Marine Handling, Inc. (No. CV 2:98-2634-18 and No. CV 2:98-2635-18, Feb. 2, 2000) (D.S.C.2000) (not reported in F.Supp.2d), to support his position. In Maxwell, the court initially ruled that Carolina Marine Handling, Inc., was entitled to tort immunity for the death of Ivan Maxwell, an employee borrowed from another business, Cooper River Machine, LLC, because, among other things, Carolina Marine had paid sufficient funds to cover the cost of LHWCA insurance premiums and Cooper River had acquired LHWCA insurance that included an alternate-employer endorsement that covered Maxwell while he was working for Carolina Marine. However, at the time of the court’s ruling, the parties had not obtained a copy of Cooper Marine’s insurance policy, so the trial court ordered that the record could be supplemented when the policy became available. The parties subsequently produced the policy, which showed that, in fact, Carolina Marine was not named or described as an alternate employer. The policy, which contained an endorsement identical to the one at issue in this case, stated that “ ‘[t]he insurance afforded by this endorsement is not intended to satisfy the alternate employer’s duty to secure its obligations under the workers compensation law.’ ” The trial court found that the alternate-employer endorsement in Cooper River’s insurance policy did not cover employees performing work for Carolina Marine and that Carolina Marine had not independently secured coverage or filed proof of any applicable coverage with the United States Department of Labor. Accordingly, the court vacated its earlier order and ruled that Carolina Marine could not claim tort immunity pursuant to 33 U.S.C. § 905(a).

The present case differs materially from Maxwell in that the endorsement at issue in this case includes the employer. A schedule attached to the endorsement defines the term “alternate employers” as “ALL USERS OF TEMPORARY EMPLOYEES OF THE NAMED INSURED” situated in Alabama and states that the endorsement is “APPLICABLE TO EMPLOYEES LEASED TO CLIENT COMPANY UNDER AN EMPLOYEE LEASING ARRANGEMENT.” (Capitalization in original; emphasis added.) It is undisputed that the employer used the employee, who the employer and AMS treated as an employee of AMS, in Alabama pursuant to an employee leasing agreement. Although the policy does not expressly identify the employer as an alternate employer, the employer certainly fits the broad description of an alternate employer contained in the schedule in the endorsement.

In Maxicell, the court did not explain the significance of the language in the endorsement purporting to place an independent duty on the alternate employer to secure its own LHWCA insurance. The Maxwell court held that Carolina Marine had a duty to obtain its own LHWCA insurance, but only because it had failed to obtain such insurance through Cooper River. In fact, by finding that Carolina Marine was not an alternate employer, the Maxivell court also implicitly found that the entire alternate-employer endorsement did not apply to the case. The employee has not presented this court with any legal authority construing an alternate-employer endorsement similar to the one at issue in this case to require a borrowing employer who has already secured its liability to an employee for LHWCA benefits through the lending employer to obtain additional LHWCA insurance in its own name for the benefit of the same employee. Based on reasoning similar to the logic employed in Forest Oil, we conclude that, for the purposes of protecting its § 905(a) immunity, the employer in the present case had no legal duty to obtain additional LHWCA insurance for the benefit of the employee, regardless of the language of the endorsement.

For the foregoing reasons, we affirm the judgment of the trial court.

AFFIRMED.

THOMPSON, P.J., and PITTMAN, BRYAN, and THOMAS, JJ., concur.

      . The summary judgment did not dispose of a third-party complaint filed by the employer against AMS and a cross-claim for indemnification filed by AMS against the employer.


text:
    HONDA MANUFACTURING OF ALABAMA, LLC v. Ronald W. ALFORD.
    2060127.
    Court of Civil Appeals of Alabama.
    Oct. 26, 2007.
    Certiorari Denied Oct. 10, 2008 Alabama Supreme Court 1070277.

      Stephen J. Bumgarner of Burr & For-man, LLP, Birmingham, for appellant.
    James T. Sasser of Carlock, Copeland, Semler & Stair, LLP, Columbus, Georgia; and Jennifer Cunningham Barber of Rice & Barber, LLC, Gadsden, for appellee.
   PITTMAN, Judge.

Honda Manufacturing of Alabama, LLC (“the employer”), appeals from a judgment entered by the Etowah Circuit Court on a workers’ compensation claim brought against the employer by Ronald W. Alford (“the employee”). We affirm in part, reverse in part, and remand.

In January 2005, the employee brought an action against the employer seeking an award of benefits under the Alabama Workers’ Compensation Act, § 25-5-1 et seq., Ala.Code 1975 (“the Act”), based upon an alleged permanent and total disability stemming from an occupational injury to his left knee. The employer filed an answer to the complaint in which, among other things, the employer denied the employee’s allegations regarding the existence of a permanent and total disability and averred that the employee had failed to give the employer proper notice of his injury. After an ore tenus proceeding, the trial court entered a judgment containing the following pertinent findings of fact and conclusions of law:

“[Although there was some dispute as to when the [employee] suffered his injury, the Court finds that an on-the-job injury[ ] occurred in April of 2008 while [the employee] was employed by the [employer] as a process associate and the parties were subject to and operating under the ... Act ....
“... [I]n April of 2008, the [employee] sustained an injury to his left knee which resulted in a tear to the lateral meniscus in the knee. Said injury, the Court finds, arose out of and in the ... course of [the employee’s] employment with the [employer],
“... The Court finds that the [employer] was notified of the [employee’s] on-the-job injury on or about June 6, 2003, which the Court finds was timely notice to the [employer],
“... The Court further finds that the [employer] suffered no prejudice by the [employee’s] delay in repoi'ting his injury to the [employer],
“... Subsequent to the [employee’s] on-the-job injury he underwent treatment and eventually surgery was performed on [his] injured knee. Although at the time of the [employee’s] injury, he apparently had some arthritis in the knee, the record is clear that the [employee] was asymptomatic of pain in his knee prior to his on the job injury and was fully capable of performing all of the necessary duties and obligations and functions required of his job as a process associate with the [employer], Subsequent to the surgery being performed on the [employee], and after [he had] reached maximum medical improvement, certain permanent work restrictions were placed on the [employee] by his treating physician, Dr. George J. Douth-it, Jr., which included but were not necessarily limited to the following: no squatting, no kneeling, no crawling, no prolonged standing, no standing over one hour without a 15 minute [period of sitting], A Functional Capacities Evaluation performed on the [employee] was what the doctor used in part as a guide for placing the permanent work restrictions on the [employee]. Dr. Douthit determined that the [employee] had suffered a 3% impairment to his body as a whole as a result of his knee injury. Based on these permanent restrictions placed on the [employee], the [employer] determined that the [employee] could no longer perform the essential job duties and functions of a process associate. Moreover, Dr. Douthit testified in his deposition that in addition to permanent restrictions he placed on the [employee] ... it would be very difficult and problematical for the [employee] to engage in additional job related functions such as climbing stairs, repetitive squatting or walking, or climbing a ladder[;] therefore^] the [employee] has, in the Court’s opinion, additional permanent restrictions on his ability to perform certain job functions. The Court notes that the [employee] has continued to have problems with his knee which has required ongoing treatment by Dr. Douthit.
“... The Court finds[ ] that in addition to the injury to the [employee’s] knee, the [employee] suffered a subsequent injury to his lower back[ ] (i.e., a ruptured lumbar disc). The Court is convinced that the back problems suffered by the [employee] are a direct result of [his] on-the-job injury to his knee. The [employee’s] favoring his injured knee caused additional strain on [his] back. The [employee] had no back problems prior to his knee injury. This opinion by the Court is supported by the [employee’s] testimony[;] the records of Dr. James G. White, the neurosurgeon who treated the [employee] for his back problems[;] and the testimony of Dr. Douthit. The Court believes that the [employee’s] back condition further inhibits [his] ability to perform certain job functions and places additional physical restrictions and limitations on his activities. The [employee] continues to have periodic back problems.
“... The Court heard testimony from vocational rehabilitation consultants for the [parties] who both evaluated the [employee]. The Court finds that the testimony of Jo Spradling, who testified on behalf of the [employee], to be more compelling than the testimony of Ms. Marcia Schulman, who testified for the [employer]. Ms. Spradling testified that based on the permanent physical restrictions placed on the [employee] by Dr. Douthit, as well as other limitations, the [employee] would be 100% vocationally disabled. Ms. Spradling testified that the [employee] would not be able to return to his trade or find gainful employment. It appears to the Court that Ms. Spradling’s opinion is based on a more complete evaluation of the [employee’s] educational background, prior work experience, age and particularly [his] post-injury limitations.
“... The Court finds that the [employee] has sustained his burden of proof so as to entitle him to recover under the ... Act ... and the Court further finds that based upon the proof in this case, the [employee] has suffered a permanent and total loss of capacity to earn a livelihood as a proximate result of his on-the-job injury with the [employer] and he is entitled to receive future compensation from the [employer],
“... Based upon the Court’s findings of fact, the Court finds that the [employee] is entitled to recover from the [employer] ... workers’ compensation benefits under the laws of the State of Alabama.”

In its appeal, the employer asserts four discrete issues. Those issues, however, may be restated more simply as (a) whether the employee’s claim was barred based upon his failure to give timely notice of his injury or to properly plead when the injury occurred, and (b) whether the trial court erred in determining that the effects of the employee’s knee injury extended to his back so as to warrant the trial court’s consideration of vocational-disability testimony and an award of benefits outside the schedule of injuries in the Act.

Under the Act, our review of the standard of proof and our consideration of other legal issues in a workers’ compensation case are without a presumption of correctness. Ala.Code 1975, § 25-5-81(e)(1). In contrast, when we review a trial court’s findings of fact, we will not reverse a judgment based upon those findings if those findings are supported by “substantial evidence,” see § 25-5-81(e)(2), a term interpreted “to mean ‘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.’ ” Ex parte Trinity Indus., Inc., 680 So.2d 262, 268 (Ala.1996) (quoting West v. Founders Life Assurance Co. of Florida, 547 So.2d 870, 871 (Ala.1989)).

The record reveals that the employee, who was 62 years old and employed as a process associate for the employer at the pertinent time, suffered a fall when his foot slipped on the cover of a conveyor belt during the employee’s normal working hours, causing the employee to “turn” his left knee. Although that fall occurred in late April 2003, the employee admitted at trial that he did not immediately report that injury to his supervisor because, he said, he did not believe that he had suffered a significant injury at that time and believed that the stiffness and swelling in his knee that arose a few days after the fall was “going to go away.” The employee first reported his injury to the employer on June 6, 2003, which is the date of injury listed in the employee’s “first report of injury” form and is the date of injury specified in the employee’s complaint.

In United Auto Workers Local 1155 v. Fortenberry, 926 So.2d 356 (Ala.Civ.App.2005), we briefly summarized the pertinent provisions of the Act governing notice:

“The pertinent notice provisions in the Act are contained in § 25-5-78, Ala. Code 1975. That section provides that ‘an injured employee or the employee’s representative, within five days after the occurrence of an accident, shall give or cause to be given to the employer written notice of the accident.’ Failure to give notice, in the absence of ‘physical or mental incapacity, other than minority, fraud or deceit, or equal good reason,’ will defeat a claimant’s entitlement to medical benefits and compensation accrued before notice is ultimately provided. Id. However, § 25-5-78 also provides that ‘no compensation shall be payable unless written notice is given within 90 days after the occurrence of the accident or, if death results, within 90 days after the death’ (emphasis added [in Fortenberry ]). Thus, while a failure to notify an employer of an accident within 5 days of its occurrence may be excusable under certain circumstances, and will work only a partial forfeiture of benefits, a failure to effect notice within 90 days is an absolute bar to recovery under the Act. See generally Ex parte Murray, 490 So.2d 1230, 1232-33 (Ala.1984). ‘The employee has the burden of proving that the employer had notice or knowledge of the injury.’ Wal-Mart Stores, Inc. v. Elliott, 650 So.2d 906, 908 (Ala.Civ.App.1994).”

Fortenberry, 926 So.2d at 359. Although § 25-5-78 refers to notice of an “accident,” Alabama caselaw indicates that the pertinent inquiry is whether the employer has received actual notice of the pertinent injury. See, e.g., Steele v. General Motors Corp., 705 So.2d 402, 404-06 (Ala.Civ.App.1997) (reversing trial court’s judgment denying benefits; holding that worker’s back injury did not manifest itself until he had enrolled in an alcohol-treatment program more than five days after accident and that oral notice of injury was given).

In this case, the employee unquestionably provided notice of his injury within 90 days of the injury; thus, under § 25-5-78, no “absolute bar to recovery” ever arose. Fortenberry, 926 So.2d at 359. Moreover, the trial court, in electing not to penalize the employee, could well have credited the employee’s testimony that his injury did not initially seem significant enough to report; in Cook Transports, Inc. v. Beavers, 528 So.2d 875, 876-77 (Ala.Civ.App.1988), we affirmed a judgment awarding benefits under the Act accruing from the actual date of an employee’s back injury, rather than the date the injury was reported, based upon testimony that the employee in that case believed that he had suffered only a muscle pull that could be alleviated with bed rest. Finally, that the employee in his complaint specified June 6, 2003, rather than a date in April 2003, as the date of his injury similarly does not warrant reversal under our Rules of Civil Procedure: as a noted treatise on the analogous federal rules observes, “[a]ny variance between the time ... alleged in the complaint and the proof at trial will be governed by the provision in Rule 15(b) for amendments to conform to the evidence.” 5A Charles A. Wright <& Arthur R. Miller, Federal Practice & Procedure § 1308 (3d ed.2004); see also id. at § 1497 (under Rule 15(c), amendments to a pleading that merely modify facts alleged in an earlier pleading will relate back to the date of the original pleading) and Newton Lumber Co. v. Owens, 682 So.2d 472 (Ala.Civ.App.1995) (affirming judgment based upon amendment to conform to evidence concerning actual injury date), writ quashed, 682 So.2d 475 (Ala. 1996). We thus reject the employer’s contentions to the effect that the trial court erred in awarding any benefits under the Act to the employee.

However, we reach a different conclusion as to the employer’s contentions regarding whether the trial court improperly considered vocational-disability evidence and improperly awarded benefits outside the injury schedule in the Act, under which a claimant sustaining an injury resulting in a loss of use of a leg (such as the employee’s knee injury in this case) is ordinarily to be compensated for a specified number of weeks based upon a fraction of the injured claimant’s weekly wages. See Ala.Code 1975, §§ 25-5-57(a)(3)a.l6. and 25-5-57(a)(3)d. In Boise Cascade Corp. v. Jackson, 997 So.2d 1026 (Ala.Civ.App.2007), we recently noted that under current Alabama Supreme Court precedent, an employee who sustains an injury to a scheduled member is to be awarded compensation based upon the schedule unless “ ‘ “the effects of the loss of the member extend to other parts of the body and interfere with their efficiency,”’” i.e., “the injury to the scheduled member [must] be ‘ “accompanied by other physical disability (of the body).” ’ ” 997 So.2d at 1034-85 (quoting Ex parte Drummond, Co., 837 So.2d 831, 834, 835 (Ala.2002), quoting in turn 4 Lex K. Larson, Larson’s Workers’ Compensation Law § 87.02 (2001) and Leach, Mfg. Co. v. Puckett, 284 Ala. 209, 214, 224 So.2d 242, 247 (1969)). After reviewing a number of authorities from other states that adhere to the “effects” test specified in Ex parte Drwmmond, this court in Boise Cascade reversed that portion of a workers’ compensation judgment determining that the claimant had suffered a back injury; we held that an employee “may not recover nonscheduled disability benefits ... on the basis of complaints of back pain in the absence of a showing that the injury to [the scheduled member] has caused a permanent physical injury to [the employee’s] back.” 997 So.2d at 1036 (emphasis added).

The trial court in this case, in concluding that the effects of the employee’s knee injury extended to the employee’s back, based its conclusion upon the testimony of the employee; the deposition testimony of the employee’s treating physician, Dr. George Douthit; and the medical records of the neurosurgeon who treated the employee for his subsequent back problem, Dr. James White. Dr. White’s records indicate that the employee was referred to him in February 2005, almost two years after the employee’s knee injury, by Dr. Jason Junkins, a physician who had treated the employee for renal stones several years previously. The employee also underwent a magnetic-resonance-imaging (“MRI”) procedure, the report of which identified “discogenie degenerative changes,” bulging, narrowing, and herniation in the lumbar region of the employee’s spinal column. After that MRI procedure had taken place, Dr. White reported that although the employee had been “hurting real bad in his back and into his groin,” the employee’s condition had “gotten a lot better,” leaving the employee ( with “some chronic back pain but not nearly enough to want to have any intervention or any further testing”; according to Dr. White, as long as the employee’s condition did not worsen, he would need “no further intervention,” and no further testing was recommended. Notably, there is no indication in Dr. White’s records that the employee’s back-pain symptoms stemmed from his knee injury.

Dr. Douthit testified at his May 2005 deposition that the employee had not complained to him of any back pain or of pain radiating to his lower extremities. Although Dr. Douthit testified that it was possible that a person sustaining a knee injury could favor that person’s other, uninjured knee and thereby put additional strain on the person’s back, he expressed surprise that the employee in this case had been seen by another physician for a spinal-disk condition. Dr. Douthit further opined that he had not expected the employee to suffer disk problems as a result of his injury.

The employee testified at trial that he had suffered a sudden onset of back pain for the first time after his knee injury and that he had been referred to Dr. White at that time. When he was asked at trial during direct examination whether he would attribute his back problems to his knee injury, the employee testified, over the employer’s competency objection, “The way I have to walk and all, yeah, I think so”; he added that the physical therapy he underwent after his knee injury “was affecting my right knee, so I’m sure it affects my back.” However, on cross-examination, the employee admitted that he had not reported any back-pain symptoms to Dr. Douthit, his authorized treating physician, during the preceding three years.

To be sure, under Alabama law, expert medical testimony is not required in every case to prove medical causation by substantial evidence. See Ex parte Price, 555 So.2d 1060, 1061 (Ala.1989). Yet both the Supreme Court and this court have emphasized that it is “ ‘the overall substance and effect of the whole of the evidence, when viewed in the full context of all the lay and expert evidence, and not ... the witness’s use of any magical words or phrases,’ ” that is the analytical touchstone in this context. Ex parte Southern Energy Homes, Inc., 873 So.2d 1116, 1121 (Ala.2003) (some emphasis added; quoting Price, 555 So.2d at 1063); accord Madix, Inc. v. Champion, 927 So.2d 833, 837 (Ala.Civ.App.2005), and Chadwick Timber Co. v. Philon, [Ms. 2050697, March 16, 2007] — So.3d -, —— (Ala.Civ.App.2007).

In Chadwick Timber, this court considered, among other things, whether a judgment awarding benefits outside the schedule of members in the Act to a claimant who had sustained a work-related leg injury could properly be affirmed based upon the theory that the effects of the claimant’s leg injury had extended to his back. In that case, the claimant, like the employee in this case, had asserted that “changes in his gait caused by his ... injury affected his back, causing him to suffer back pain and contributing to what he claims is his permanent total disability.” — So.3d at -. We rejected the claimant’s argument based upon the dearth of causation evidence other than the claimant’s own testimony; the only other pertinent evidence was the testimony of the claimant’s physician, who stated that “it was possible, but not likely, that the back pain was caused by a change in [the claimant’s] gait.” — So.3d at-. Under those circumstances, we concluded that the claimant had adduced nothing “ ‘ “more than evidence of mere possibilities” ’ ” that his back injury was related to his leg injury and that the employer should not be “guessed” into liability. — So.3d at -. To like effect is Boise Cascade, in which the medical evidence reflected only a possibility that the claimant’s back-pain symptoms had arisen because of an antalgic gait, yet no evidence showed that the claimant actually walked with such a gait. 997 So.2d at 1031.

In this case, the employee has testified that he experienced back pain after sustaining his knee injury. However, the employee has sought medical attention for that back pain on only one occasion, in February 2005, at which time the employee was diagnosed with chronic back pain that was insufficient to warrant further medical intervention or testing. No medical evidence connected the medical conditions present in the employee’s spinal column to the knee injury he had sustained while working for the employer. Moreover, as in Chadwick Timber, no medical evidence adduced at trial would support anything other than the mere possibility that a lower-extremity injury could have caused back pain via a change in the injured person’s gait; indeed, in this case, Dr. Douthit expressed surprise that the employee would have suffered back pain after the knee injury. As a result, we cannot conclude that that portion of the trial court’s judgment awarding benefits beyond those specified in the schedule of members in the Act is supported by substantial evidence.

To the extent that the trial court concluded that the employee is entitled to benefits under the Act despite his delay in giving notice of his injury, its judgment is affirmed. To the extent that the trial court, in its judgment, awarded benefits outside those provided for in the Act for injuries to scheduled members, its judgment is due to be reversed. The cause is remanded for the entry of a judgment, or for further proceedings, consistent with this court’s opinion. Moreover, “[bjecause the employee’s injury falls within the schedule, the trial court erred in receiving evidence relating to the employee’s loss of earning capacity”; therefore, “[o]n remand, the trial court [should] calculate the scheduled disability benefits without consideration of any ... evidence of vocational . disability, including the testimony of ... vocational experts and any evidence relating to the impact of the injury on the employee’s ability to obtain employment and earn wages.” Boise Cascade, 997 So.2d at 1037-38.

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

THOMPSON, P.J., and BRYAN, THOMAS, and MOORE, JJ., concur.

      . Unlike in Fort James Operating Co. v. Crump, 947 So.2d 1053 (Aia.Civ.App.2005), we are not here confronted with two separate incidents leading to similar but separate injuries; it is undisputed that the employee in this case suffered only one injury.

      . Drummond, expressly abrogated caselaw standing for the proposition, relied upon by the employee in this case, that “an abnormal and unusual incapacity with respect to the member” will permit an employee suffering an injury to a scheduled member to be compensated outside the schedule. 837 So.2d at 835 n. 10.

      . In the absence of any pertinent argument from the parties to the contrary, we assume, without deciding, that the employee’s allegation that his back pain resulted from an accidental traumatic injury to his knee rendered inapplicable the "clear and convincing evidence” standard of proof under the Act governing claims stemming from injuries resulting from gradual deterioration or cumulative-physical-stress disorders {see generally § 25-5-81(c), Ala.Code 1975).


author: BASCHAB, Presiding Judge.

text:
    Fernando Nolasco MENDEZ v. STATE of Alabama.
    CR-07-0128.
    Court of Criminal Appeals of Alabama.
    April 4, 2008.
    Fernando Nolasco Mendez, pro se.
    Troy King, atty. gen., and Cecil G. Bren-dle, Jr., asst. atty. gen., for appellee.
   BASCHAB, Presiding Judge.

On December 4, 2006, pursuant to a negotiated agreement, the appellant, Fernando Nolasco Mendez, pled guilty to murder. The trial court sentenced him to serve a term of twenty years in prison. He did not appeal his conviction. On August 3, 2007, the appellant filed a Rule 32 petition, challenging his conviction. After the State responded, the circuit court summarily dismissed the petition. This appeal followed.

In his petition, the appellant argued that he did not appeal his conviction through no fault of his own and that his counsel rendered ineffective assistance because he did not file a direct appeal. The State did not refute these claims. Also, the circuit court did not make any findings of fact regarding these claims. Because these claims could be meritorious, the circuit court erred in not addressing them.

Accordingly, we remand this ease to the circuit court for that court to make specific, written findings of fact concerning the appellant’s claims that he did not appeal his conviction through no fault of his own and that his counsel rendered ineffective assistance because he did not file a direct appeal. On remand, the circuit court may require the State to respond specifically to the appellant’s contentions and/or may conduct an evidentiary hearing. The circuit court shall take all necessary action to see that the circuit clerk makes due return to this court at the earliest possible time and within 56 days after the release of this opinion. The return to remand shall include the circuit court’s written findings of fact and, if applicable, the State’s response and/or a transcript of the evidentiary hearing.

REMANDED WITH INSTRUCTIONS.

McMILLAN, WISE, and WELCH, JJ., concur.

SHAW, J., concurs in the result.

      . Because of our disposition of this case, we pretermit discussion of the remaining claims the appellant raises in his brief to this court.


author: PER CURIAM. WELCH, Judge,

text:
    Ragon KING v. STATE of Alabama.
    CR-06-1269.
    Court of Criminal Appeals of Alabama.
    April 4, 2008.
    Rehearing Denied May 23, 2008.
    Certiorari Denied Sept. 18, 2008 Alabama Supreme Court 1071219.

      Mark H. Carlton, LaFayette, for appellant.

      Troy King, atty. gen., and John J. Davis, asst. atty. gen., for appellee.
   PER CURIAM.

The appellant, Ragon King, pleaded guilty to the unlawful possession of a controlled substance, methamphetamine, a violation of § 13A-12-212, Ala.Code 1975, and was sentenced to six years in prison. Before pleading guilty King specifically reserved his right to appeal the circuit court’s ruling denying his motion to suppress.

At the suppression hearing, Sgt. Mike Parrish of the Chambers County Sheriffs Department testified that he received numerous complaints from Gabriel Wayne Hornsby’s neighbors about unusual activity at Hornsby’s house. The complaints were based on the heavy traffic to and from his residence and a pervasive chemical odor emanating from the residence. Sgt. Parrish and Deputy Terry Wood set up surveillance on the house and saw the heavy traffic. On one occasion they smelled the distinct odor of anhydrous ammonia — a chemical commonly used in the production of methamphetamine. Sgt. Parrish obtained a search warrant for the premises.

On May 12, 2006, Sgt. Parrish and Deputy Wood went to Hornsby’s house to execute the search warrant. While waiting for backup officers, Sgt. Parrish and Deputy Wood saw King and Elise Escalera leave the residence, enter a vehicle, and drive up to the mailbox in front of the house. As King started to drive away from the mailbox, Sgt. Parrish and Deputy Wood stopped the vehicle. Deputy Wood informed King of the purpose for the stop and asked him to get out of the vehicle. Deputy Wood advised King that he was going to conduct a patdown search for weapons. The patdown search initially revealed a pocketknife. Deputy Wood then felt an object that he could not identify. When Deputy Wood asked King what was in his pocket King responded that he had just put his pants on and did not know. King then gave Deputy Wood permission to retrieve the object. Deputy Wood retrieved a closed black film canister and opened it. The canister contained what Deputy Wood recognized as metham-phetamines and a pink tablet. Deputy Wood then arrested King.

“ ‘This Court reviews de novo a circuit court’s decision on a motion to suppress evidence when the facts are not in dispute.’ State v. Skaggs, 903 So.2d 180, 181 (Ala.Crim.App.2004). ‘A trial court’s ultimate legal conclusion on a motion to suppress based on a given set of facts is a question of law that is reviewed de novo on appeal.’ State v. Hargett, 935 So.2d 1200, 1204 (Ala.Crim.App.2005).”

Marshall v. State, 992 So.2d 762, 767 (Ala.Crim.App.2007).

I.

King contends that the initial traffic stop and the subsequent search of his person were without probable cause and that they exceeded the scope of the search warrant. Specifically, King argues that police could not search him because he was not on the premises named in the search warrant nor was he specifically named in the search warrant.

The search warrant provided for a search of “[t]he premises known as the residence of Gabriel Wayne Hornsby ... located at 7255 County Road 114, Lafayette, Chambers County, Alabama. The search warrant is to include the premises described, the curtilage, any outbuildings and vehicles on the curtilage, the persons of Gabriel Wayne Hornsby....” (emphasis added). The property to be searched for and seized was listed specifically as: “methamphetamine, clandestine laboratory equipment, drug paraphernalia, and U.S. Currency derived from the sale of such.”

“ ‘A search warrant authorizing a search of certain premises generally includes any vehicles located within its curti-lage if the objects of the search might be located therein.’ ” English v. State, 603 So.2d 1128, 1130 (Ala.Crim.App.1992), quoting United States v. Gottschalk, 915 F.2d 1459, 1461 (10th Cir.1990). When Sgt. Parrish and Deputy Wood arrived to execute the search warrant, King’s vehicle was parked within the curtilage of Horns-by’s residence. Thus, the vehicle was within the scope of the search warrant. “A valid search warrant authorizing the search of vehicles on the subject property permits the search of vehicles arriving on that property during the course of the search, so long as those vehicles could reasonably contain items the officers are searching for.” United States v. Tamari, 454 F.3d 1259, 1263 (11th Cir.2006). The circuit court did not err when it denied King’s motion to suppress on these grounds.

II.

King next argues that the trial court erred in denying his motion to suppress because, he argues, the search of his person was outside the scope of the search warrant and was conducted without his consent. It is undisputed that King gave his consent for Deputy Wood to retrieve the object; however, King argues that Deputy Wood exceeded the scope of his consent when he opened the film canister.

“A consensual search is reasonable if the search is within the scope of the consent given. United States v. Martinez, 949 F.2d 1117, 1119 (11th Cir.1992). The scope of a person’s consent is determined by whether it is objectively reasonable for the police to believe that the consent permitted them to search where they did. Florida v. Jimeno, 500 U.S. 248, 111 S.Ct. 1801, 1803-04, 114 L.Ed.2d 297 (1991). ...
“The scope of a search may be further defined during the course of the search by the passive acquiescence of the person whose property is being searched. See e.g., United States v. DeWitt, 946 F.2d 1497, 1501 (10th Cir.1991) (officer’s placement of his hand in cleft between back seat cushions of car did not exceed scope of consent, where defendant did not object until after discovery of narcotics), cert. denied, 502 U.S. 1118, 112 S.Ct. 1233, 117 L.Ed.2d 467 (1992); United States v. Alfaro, 935 F.2d 64, 67 (5th Cir.1991) (defendant fails to withdraw consent where he asks to go outside to talk to another but makes no protest). Cf. United States v. Patacchia, 602 F.2d 218, 219 (9th Cir.1979) (saying T would but I can’t’ open car trunk, is not consent where prior consent not given).”

Grinton v. Commonwealth, 14 Va.App. 846, 850-51, 419 S.E.2d 860, 862-63 (1992). “ ‘The standard for measuring the scope of a suspect’s consent under the Fourth Amendment is that of “objective” reasonableness — what would the typical reasonable person have understood by the exchange between the officer and the suspect?’” Bender v. State, 687 So.2d 219, 221 (Ala.Crim.App.1996), quoting Florida v. Jimeno, 500 U.S. 248, 250 (1991).

At the suppression hearing Deputy Wood testified that he asked King for permission to retrieve the unidentified object from his pocket to determine what it was and that the appellant consented. During the suppression hearing, defense counsel argued that Deputy Wood had permission to retrieve the canister, but not to investigate what it was. The following transpired at the suppression hearing:

“[DEFENSE COUNSEL]: You got the film canister out. It has got a top on it. You are holding it in your hand. What did you do with it?
“DEPUTY WOOD: I checked to see what was inside in case it was something that was going to harm me.
“[DEFENSE COUNSEL]: Did you ask him permission to open that up?
“DEPUTY WOOD: I asked for permission to retrieve it and find out what it was.
“[DEFENSE COUNSEL]: You said you asked him permission to — Well, you asked him. From what I remember, you said, ‘What else is in your pocket?’
“DEPUTY WOOD: Yes.
“[DEFENSE COUNSEL]: He said, T don’t know. I just put my pants on. I’m not sure what it is.’
“DEPUTY WOOD: Um-hum.
“[DEFENSE COUNSEL]: You said, ‘Do you mind if I retrieve it?’
“DEPUTY WOOD: Retrieve it and find out what it was.
“[DEFENSE COUNSEL]: So you want to retrieve it and find out what it is instead of just retrieve it?
“DEPUTY WOOD: I pulled it from his pocket to find out what it was.
“[DEFENSE COUNSEL]: Okay. Now, you asked him permission to take out the knife and he said yes?
“DEPUTY WOOD: Yes, um-hum.
“[DEFENSE COUNSEL]: You asked him permission to take the canister out of his pocket. He said, yes. Did you ask him for permission to open and see what was inside?
“DEPUTY WOOD: I felt that me trying to find out what it was included me being able to open it and make sure there was nothing inside of it.
“[DEFENSE COUNSEL]: So you didn’t feel like you needed to ask him to open it?
“DEPUTY WOOD: No, I didn’t.”

(R. 25-28.) There was no testimony indicating that King objected when Deputy Wood opened the film canister or that King revoked his consent at any time.

The circuit court, when denying the motion to suppress, stated that it was reasonable for Deputy Wood to believe that the consent to retrieve the canister also encompassed the consent to open it. We agree with the circuit court that a reasonable person would have understood that retrieving the object, the black film canister, and finding out what it was, would of necessity, include opening the canister. Therefore, we hold that Deputy Wood’s search did not exceed the scope of King’s consent, and the circuit court correctly denied King’s motion to suppress.

For these reasons, we affirm King’s conviction for the unlawful possession of a controlled substance.

AFFIRMED.

BASCHAB, P.J., and McMILLAN and WISE, JJ., concur. SHAW, J., concurs in the result. WELCH, J., dissents, with opinion.

WELCH, Judge,

dissenting.

I agree with that portion of the majority’s opinion holding that the initial stop of King’s vehicle was valid pursuant to a properly executed search warrant. However, as discussed below, I do not believe that Deputy Terry Wood had consent to open the film canister he removed from King’s pocket during a patdown search. Therefore, I believe that King’s motion to suppress was due to be granted, and I respectfully dissent.

The majority holds that it was reasonable for the arresting officer, Deputy Wood, to believe that the scope of King’s consent to retrieve the film canister from King’s pocket included opening the canister. However, I do not believe that the record supports this view. Deputy Wood testified as follows regarding his obtaining consent to search King’s person.

“Q. [The prosecutor:] Okay. What did you ask Mr. King?
“A. [Deputy Wood:] I advised Mr. King our reasons for being there. I advised him of the search warrant. I asked him if he would to step out of the vehicle.
“Q. Did he do so?
“A. Yes, he did.
“Q. Okay. What did you do at that point?
“A. I asked Mr. King did he have anything on him that I needed to know about as far as weapons or anything. I advised him that I was going to pat him down for weapons.”

(R. 21.)(Emphasis added.)

Here, Deputy Wood told King that the search of King’s person was for weapons. “ ‘[T]he scope of a search is generally defined by its expressed object.’ ” Tillman v. State, 647 So.2d 7, 11 (Ala.Crim.App.1994) (quoting Florida v. Jimeno, 500 U.S. 248, 251 (1991)); United States v. Garrido-Santana, 360 F.3d 565, 576 (6th Cir.2004) (“Generally, the expressed object of the search defines the scope of that search.”). I do not believe that it was objectively reasonable for Deputy Wood to conclude that he had consent to open the film canister after having informed King that he was searching for a weapon. Only by engagement of “ ‘fanciful speculation’ ” could a film canister be considered a dangerous weapon or to be concealing a dangerous weapon. 4 Wayne R. LaFave, Search and Seizure § 9.6(d), p. 671 (4th ed.2004). For supporting cases see 4 La-Fave, Search and Seizure § 9.6(d), p. 771 n. 258. In such speculation I decline to engage. See, e.g., Cannon v. State, 985 So.2d 968, 971 (Ala.Crim.App.2007) (contents of film canister removed from suspect’s pocket suppressed where “nothing in the record show[ed] that the nature of the contraband found in the canister was immediately apparent when [the officer] pulled it from Cannon’s pocket”). Moreover, I do not believe that the alleged “passive acquiescence” referred to by the majority has application in this case. Unlike cases cited by the majority involving searches for contraband, a Terry patdown is a limited search, conducted solely to protect the safety of law enforcement. Its scope should never exceed what is necessary to protect the safety of officers. Thus, I do not agree that King consented to Deputy Wood’s opening of the canister.

Absent consent, a container taken during a Terry patdown should not be opened “unless it might contain a weapon, a judgment which the officer should be expected to make on the basis of its size, weight and feel.” 4 W. LaFave, Search and Seizure § 9.6(d), pp. 669-71 (quoting Model Code of Pre-Arraignment Procedure § 110.2(4) (1975)).

Based on the above, I respectfully dissent.