author: SELLERS, Justice.

text:
    William G. VEITCH v. J. Scott VOWELL, in his capacity as acting Chief Election Official of Jefferson County, and Steve Marshall, in his capacity as Attorney General of the State of Alabama
    1170723
    Supreme Court of Alabama.
    June 1, 2018
    Jon David Terry of Bains & Terry, Bessemer.
    French A. McMillan of Sewell Sewell McMillan, LLC, Jasper; and T.A. Lawson II, county atty., Shawnna H. Smith, deputy county atty., and Donald McKinley Carroll, asst. county atty., Jefferson County Attorney's Office, Birmingham, for appellee J. Scott Vowell, in his capacity as acting Chief Election Official of Jefferson County.
    Steve Marshall, atty. gen., and James W. Davis, deputy atty. gen., and Winfield J. Sinclair, asst. atty. gen., for amicus curiae Steve Marshall, in his capacity as Attorney General of the State of Alabama, in support of the appellee.
   SELLERS, Justice.

William G. Veitch is a Republican candidate for district attorney for the 10th Judicial Circuit of Alabama. He filed a petition for a declaratory judgment and for a writ of mandamus in the Jefferson Circuit Court ("the trial court"), requesting that court to direct that the names of candidates running for the office of district attorney for the 10th Judicial Circuit be included not only on the ballot to be used in the primary election in the Birmingham Division of Jefferson County, but also on the ballot to be used in the primary election in the portion of Jefferson County known as the Bessemer Cutoff. The trial court dismissed Veitch's action based on its conclusion that it lacked subject-matter jurisdiction and, alternatively, based on the doctrine of laches. Veitch appealed. We reverse the trial court's judgment and remand the cause for further proceedings.

"Jefferson County constitutes the Tenth Judicial Circuit; that circuit is divided into two divisions-the Birmingham Division and the Bessemer Division." City of Bessemer v. McClain, 957 So.2d 1061, 1069 n.6 (Ala. 2006). "In 1893, Local Act No. 281 created the Bessemer Division; however, that division was subsequently abolished. In 1919, the Bessemer Division was recreated by Local Act No. 213." Id. at 1070.

Act No. 138, Ala. Acts 1953 ("the 1953 Act"), states:

"[C]andidates in primary elections for nominations for Circuit Solicitor [now district attorney] of the Tenth Judicial Circuit of Alabama [consisting of Jefferson County] shall be placed upon the ballots in such primary elections only in those precincts over which the Circuit Court holding at Birmingham, Alabama, has jurisdiction; that is to say, candidates for nomination in such primary elections for [district attorney] of the Tenth Judicial Circuit of Alabama shall run and shall be placed upon the ballots used in such primaries only in those precincts which are within the jurisdiction of said Circuit Court holding at Birmingham, Alabama."

Based on the 1953 Act, the practice in primary elections in Jefferson County is to include the names of candidates running for district attorney for the 10th Judicial Circuit on only the ballots that will be used in the Birmingham Division and not on the ballots that will be used in the Bessemer Division. That said, the parties appear to agree that the 1953 Act was ignored in 2016, because the names of Democratic candidates for district attorney for the 10th Judicial Circuit apparently were included on the ballot used in the primary election in the Bessemer Division. Veitch has suggested that the names of Republican candidates that year were not included on that ballot. The parties agree that, with respect to the general election, the candidates for district attorney are included on the ballots used in both divisions.

Scott Vowell, the acting chief of the Jefferson County Election Commission, asserts that, on March 28, 2018, he approved the Republican and Democratic ballots for the primary election in the Bessemer Division and that those ballots did not include the office of district attorney for the 10th Judicial Circuit and, thus, did not include Veitch's or the names of other candidates for that office. Veitch, however, took the position that voters in the primary elections in the Bessemer Division should be allowed to vote on the candidates running for the office of district attorney. Accordingly, he filed his declaratory-judgment action and petition for a writ of mandamus on April 13, 2018.

In his petition, Veitch asserted that the 1953 Act has been repealed by a later act, which, Veitch asserted, requires primary elections to be conducted in the same manner as general elections. He also challenged the validity and application of the 1953 Act under §§ 33 and 105, Ala. Const. of 1901, as well as "the due process and equal protection provisions of the Alabama Constitution and the 14th Amendment of the U.S. Constitution." Section 33, Ala. Const. 1901, provides that "[t]he privilege of suffrage shall be protected by laws regulating elections, and prohibiting, under adequate penalties, all undue influences from power, bribery, tumult, or other improper conduct." Section 105, Ala. Const. 1901, provides that "[n]o ... local law, except a law fixing the time of holding courts, shall be enacted in any case which is provided for by a general law." The trial court's judgment indicates that Veitch also argued that the 1953 Act has been unconstitutionally applied because, in 2016, it was ignored with respect to Democratic candidates for the office of district attorney for the 10th Judicial Circuit and the names of those candidates appeared on the ballot for the Bessemer Division.

Veitch requested that the trial court enter a temporary restraining order enjoining the printing of the June 2018 primary ballots for the Bessemer Division, which the trial court granted. Steve Marshall, the Attorney General for the State of Alabama, appeared in the action after being served because the constitutionality of a legislative act was being challenged and filed a motion requesting that the trial court set aside the restraining order. Vowell also asked the trial court for the same relief and to dismiss Veitch's action. On April 20, 2018, the trial court entered a judgment setting aside the restraining order and dismissing the action.

In its judgment, the trial court stated that, under § 17-16-44, Ala. Code 1975, it lacked jurisdiction to grant the relief Veitch had requested. That statute, known as the "jurisdiction-stripping statute," provides:

"No jurisdiction exists in or shall be exercised by any judge or court to entertain any proceeding for ascertaining the legality, conduct, or results of any election, except so far as authority to do so shall be specially and specifically enumerated and set down by statute; and any injunction, process, or order from any judge or court, whereby the results of any election are sought to be inquired into, questioned, or affected, or whereby any certificate of election is sought to be inquired into or questioned, save as may be specially and specifically enumerated and set down by statute, shall be null and void and shall not be enforced by any officer or obeyed by any person. If any judge or other officer hereafter undertakes to fine or in any wise deal with any person for disobeying any such prohibited injunction, process, or order, such attempt shall be null and void, and an appeal shall lie forthwith therefrom to the Supreme Court then sitting, or next to sit, without bond, and such proceedings shall be suspended by force of such appeal; and the notice to be given of such appeal shall be 14 days."

The trial court relied on Rice v. Chapman, 51 So.3d 281 (Ala. 2010). In that case, the petitioners sought to prevent a candidate for the Republican nomination for Associate Justice of the Alabama Supreme Court from running in the primary election based on his alleged failure to timely file an "Appointment of Principal Campaign Committee" and a "Statement of Economic Interest," both of which were required pursuant to statute. Pointing to § 17-16-44, a Special Supreme Court of Alabama held that the trial court in Rice did not have jurisdiction over the proceedings, stating:

"The petitioners' lawsuit implicates the jurisdiction-stripping statute because it seeks to impact the 'conduct' of the June 1, 2010, Republican primary election by having the court either remove the name of one of the candidates ... from the ballot or instruct the Republican Party not to canvass votes cast for [that candidate]."

51 So.3d at 284.

Rice, however, is inapposite. That case dealt with a candidate who had been approved by a political party to run in a primary election and had been certified to do so by election officials, but who had allegedly failed to timely file the necessary paperwork before certification. In contrast, the present case deals with whether Veitch has been denied an alleged right to have his name included on all primary ballots in Jefferson County for what he describes as a "county-wide" office, by virtue of an act that he alleges has been repealed, is unconstitutional, or has been unconstitutionally applied. It is undisputed that Veitch properly filed the necessary paperwork to qualify as a candidate, that he was duly certified as a candidate by the Republican Party and the Alabama Secretary of State, and that his name was submitted to the Jefferson County Election Commission for inclusion on the Republican primary ballot. This dispute concerns whether he should be identified as a candidate on all the ballots in Jefferson County.

King v. Campbell, 988 So.2d 969 (Ala. 2007), although not directly on point, is somewhat helpful in our analysis. In that case, a registered voter and a candidate for judicial office challenged an act of the legislature that provided that a newly created judgeship in the 29th Judicial Circuit was to be initially filled by appointment by the Governor. The voter sued the Attorney General and the Secretary of State. The voter argued that the act at issue was unconstitutional for various reasons and should, therefore, be declared a nullity. He also argued that a previous act, which had been amended by the challenged act and which had provided that the new judgeship would be filled by an election, should control. The voter obtained a preliminary injunction directing the Secretary of State to place the candidate's name on the ballot for the upcoming general election. The candidate went unopposed in that election and received a substantial number of votes. After the election, the candidate joined in the voter's action and adopted all of his arguments. The trial court in King eventually entered a final judgment declaring the challenged act unconstitutional and directing that the candidate be sworn in as a circuit judge. On appeal, this Court concluded that, notwithstanding § 17-16-44, the Court had jurisdiction to consider the Attorney General's argument that the election to fill the judgeship was unauthorized under law. In doing so, the Court gave no indication that the trial court in King had been without jurisdiction to enter the injunction requiring the candidate's name to be included on the ballot in light of the alleged unconstitutionality of the challenged act.

In Dennis v. Prather, 212 Ala. 449, 452, 103 So. 59, 62 (1925), this Court, in construing the predecessor statute to § 17-16-44, stated that "[s]tatutes restricting the jurisdiction of courts of equity, as defined at common law, and reiterated by statute in Alabama, should be strictly construed." In Sears v. Carson, 551 So.2d 1054, 1056 (Ala. 1989), the Court noted that "[t]he purpose and intent of [the predecessor statute to § 17-16-44 ] were not to undermine the sanctity of the individual vote." We conclude that § 17-16-44 is not aimed at challenges such as the one made by Veitch and does not preclude the trial court from exercising jurisdiction over Veitch's action.

The trial court also alternatively relied on the doctrine of laches in support of its judgment.

" ' "Laches" is defined as neglect to assert a right or a claim that, taken together with a lapse of time and other circumstances causing disadvantage or prejudice to the adverse party, operates as a bar.' Ex parte Grubbs, 542 So.2d 927, 928 (Ala. 1989) (citing Black's Law Dictionary 787 (5th ed. 1979) ). It is an equitable doctrine applied by the courts to prevent a party that has delayed asserting a claim to assert that claim after some change in conditions has occurred that would make belated enforcement of the claim unjust. Ex parte Grubbs, 542 So.2d at 929. A party asserting laches as a defense is generally required to show that the plaintiff has delayed in asserting a claim, that that delay is inexcusable, and that the delay has caused the party asserting the defense undue prejudice. Id."

Elliott v. Navistar, Inc., 65 So.3d 379, 386 (Ala. 2010). Vowell and Marshall assert that, by the time Veitch filed this action, absentee ballots in the Bessemer Division had been issued and absentee voting had begun. They also assert that the deadline for submitting ballots to military and overseas voters expired on April 21, 2018, eight days after Veitch filed his action. Finally, Vowell asserts that "all paper ballots have been printed."

Vowell and Marshall argue that undue prejudice will result if Veitch is granted the relief he seeks. In the Court's opinion, however, it has not been established that Veitch was dilatory in protecting his rights or that he otherwise delayed in filing his action or that any alleged delay was inexcusable. Although the record does not conclusively establish when Veitch was made aware that the ballot to be used in the Bessemer Division Republican primary would not identify him as a candidate, Vowell asserts that he approved that ballot on March 28, 2018. Vowell does not point to any evidence indicating that Veitch had the relevant knowledge at any point before that time. Veitch filed his action a little over two weeks later on April 13, 2018. It is difficult to view two weeks as an unreasonable delay in filing an action so as to invoke the doctrine of laches.

In conclusion, the jurisdiction-stripping statute did not deprive the trial court of jurisdiction and Veitch was not precluded by the doctrine of laches from bringing his action. At this point, the Court expresses no opinion on the merits of Veitch's arguments regarding the alleged repeal of the 1953 Act, its alleged unconstitutionality, or its alleged unconstitutional application. The trial court's judgment is reversed and this cause is remanded for further proceedings.

REVERSED AND REMANDED.

Stuart, C.J., and Main and Wise, JJ., concur.

Bryan and Mendheim, JJ., concur in the result.

BRYAN, Justice (concurring in the result).

I agree with the plurality opinion that the Jefferson Circuit Court had subject-matter jurisdiction to decide William G. Veitch's petition for a declaratory judgment, but only insofar as Veitch requested "a judgment declaring Act No. 138, [Ala. Acts 1953,] to be null and void as being unconstitutional and/or repealed." The authority cited in the plurality opinion does not, in my opinion, support a conclusion that the circuit court has subject-matter jurisdiction to provide the other relief requested by Veitch: an order requiring his name to appear on all ballots within the 10th Judicial Circuit, including those in the Bessemer Division, and an order temporarily restraining election officials from printing the June 5, 2018, Republican primary ballot for precincts in the Bessemer Division without his name included. I note, at this late hour, the circuit court is wholly incapable of providing Veitch any relief in this proceeding that could have any effect on the June 5, 2018, primary election.

Mendheim, J., concurs.

      Veitch's petition names Alan King, judge of probate for Jefferson County, as the defendant; however, Vowell was appointed the acting chief of the Jefferson County Election Commission and was substituted as the defendant. See Rule 25(d), Ala. R. Civ. P.

      Vowell suggests that Veitch was aware as early as March 2, 2018, that the Bessemer Division primary-election Republican ballot would not include his name. In support, Vowell points to a portion of the record containing a copy of a campaign finance report apparently submitted by Veitch on that date. It is not clear, however, how that document supports Vowell's assertion, and he provides no explanation as to how it does.

      As an alternative to his appeal, Veitch asked this Court to issue a writ of mandamus directing Vowell to include the candidates for district attorney for the 10th Judicial Circuit on the primary ballot made available to voters in the Bessemer Division. This Court, however, elected to treat Veitch's filing as an expedited appeal of the trial court's judgment.


source: Caselaw Access Project

author: BRYAN, Justice.

license: Public Domain

text:
    Philip RICHARDSON v. Rosemarie CHAMBLESS
    1170263
    Supreme Court of Alabama.
    June 15, 2018
    Donald H. Brockway, Jr., Birmingham, for appellant.
    Paul J. Spina III of Spina & Lavelle, PC, Birmingham, for appellee.
   BRYAN, Justice.

Philip Richardson appeals from a partial summary judgment entered by the Jefferson Circuit Court ("the trial court") in the action Richardson filed against Ben Chambless ("Ben"); Rosemarie Chambless ("Rosemarie"); Alaspec Residential Inspections, LLC ("Alaspec"); and Good Cents Home Inspections & Energy Management, LLC ("Good Cents"). For the reasons set forth herein, we dismiss the appeal.

Facts and Procedural History

In 2011, Richardson filed a complaint against Ben, Alaspec, and Good Cents in which he requested a jury trial on multiple claims arising from an allegedly faulty inspection the defendants had performed on a house Richardson was in the process of purchasing. In June 2012, the trial court entered a default judgment against Good Cents for failure to answer and, following a hearing, entered an order in July 2012 awarding Richardson $80,281.28 against Good Cents based on findings that the inspection report failed to disclose material defects in the house and that Richardson would not have purchased the house if the inspection report had disclosed those defects.

In March 2013, Richardson amended his complaint to add Rosemarie, who was Ben's wife at the time, as a defendant. In his amended complaint, Richardson alleged that, in December 2012, Ben had transferred his interest in the Chamblesses' marital residence to Rosemarie ("the transfer") and that Ben had made the transfer because, Richardson said, Ben "knew he was going to incur ... a foreseeable judgment in the lawsuit filed by ... Richardson" and knew that making the transfer "would impair his ability to pay this ... judgment." Given those allegations, Richardson asserted a claim against Ben and Rosemarie under the Alabama Fraudulent Transfer Act, § 8-9A-1 et seq., Ala. Code 1975 ("the AFTA"), and sought as relief an order voiding the transfer, enjoining any further encumbrance or disposition of Ben's interest in the marital residence, and attaching that interest for the satisfaction of any judgment Richardson might obtain against Ben. Richardson also asserted against Ben and Rosemarie a conspiracy-to-commit-fraud claim arising from the transfer and, pursuant to § 6-6-180, Ala. Code 1975, sought to compel Ben and Rosemarie "to produce an itemized list ... of all of their assets" to "be subject to the payment of [Richardson's] claims/judgments/debts."

In October 2017, Rosemarie filed a motion for a summary judgment on Richardson's claims against her. On November 16, 2017, the trial court entered a judgment in which it found that there were no genuine issues of material fact as to Richardson's claims against Rosemarie and that Rosemarie was therefore entitled to a judgment as a matter of law on those claims. Richardson's claims against Ben and Alaspec remained pending, but the trial court, finding that there was no just reason for delay, certified its partial summary judgment as final pursuant to Rule 54(b), Ala. R. Civ. P. Richardson appealed.

Discussion

On appeal, Richardson argues that there are genuine issues of material fact that preclude a summary judgment as to his claims against Rosemarie. However, before reaching the merits of the parties' arguments, we must first determine whether the trial court's Rule 54(b) certification was proper, because, if it was not, then the trial court's partial summary judgment is not a final judgment and will not support Richardson's appeal. See Stephens v. Fines Recycling, Inc., 84 So.3d 867, 872 (Ala. 2011) (" '[I]f a Rule 54(b) certification is determined to have been improperly entered, the judgment so certified is considered to be nonfinal and therefore unable to support an appeal.' " (quoting Allen v. Briggs, 60 So.3d 899, 904 (Ala. Civ. App. 2010) ) ); Kirksey v. Johnson, 166 So.3d 633, 643 (Ala. 2014) (dismissing an appeal as one arising from a nonfinal judgment after concluding that the trial court's Rule 54(b) certification was improper); and Dzwonkowski v. Sonitrol of Mobile, Inc., 892 So.2d 354 (Ala. 2004) (same).

" Rule 54(b) provides, in part:

" 'When more than one claim for relief is presented in an action, whether as a claim, counterclaim, cross-claim, or third-party claim, or when multiple parties are involved, the court may direct the entry of a final judgment as to one or more but fewer than all of the claims or parties only upon an express determination that there is no just reason for delay and upon an express direction for the entry of judgment.'
"This Court recently explained [in Centennial Associates v. Guthrie, 20 So.3d 1277, 1279 (Ala. 2009),] the appropriate standard for reviewing Rule 54(b) certifications, stating:
" ' "If a trial court certifies a judgment as final pursuant to Rule 54(b), an appeal will generally lie from that judgment." Baugus v. City of Florence, 968 So.2d 529, 531 (Ala. 2007).' "

Lighting Fair, Inc. v. Rosenberg, 63 So.3d 1256, 1263 (Ala. 2010).

"However, this Court will not consider an appeal from a judgment certified as final under Rule 54(b) if it determines that the trial court exceeded its discretion in concluding that there is 'no just reason for delay.' Rule 54(b) ; see also Scrushy v. Tucker, 955 So.2d 988, 996 (Ala. 2006) ('Whether there was "no just reason for delay" is an inquiry committed to the sound discretion of the trial court, and, as to that issue, we must determine whether the trial court exceeded its discretion.')."

Loachapoka Water Auth., Inc. v. Water Works Bd. of Auburn, 74 So.3d 419, 422-23 (Ala. 2011).

"[I]n considering whether a trial court has exceeded its discretion in determining that there is no just reason for delay, several United States Courts of Appeals have expressly considered whether the resolution of claims that remain pending in the trial court may moot claims presented on appeal.5 In MCI Constructors, LLC v. City of Greensboro, 610 F.3d 849 (4th Cir. 2010), the United States Court of Appeals for the Fourth Circuit explained:
" 'In determining whether there is no just reason for delay in the entry of judgment, factors the district court should consider, if applicable, include:
" ' "(1) the relationship between the adjudicated and unadjudicated claims; (2) the possibility that the need for review might or might not be mooted by future developments in the district court; (3) the possibility that the reviewing court might be obliged to consider the same issue a second time; (4) the presence or absence of a claim or counterclaim which could result in a set-off against the judgment sought to be made final; (5) miscellaneous factors such as delay, economic and solvency considerations, shortening the time of trial, frivolity of competing claims, expense, and the like.
" ' Braswell [Shipyards, Inc. v. Beazer E., Inc. ], 2 F.3d [1331,] 1335-36 [ (4th Cir. 1993) ] [footnote omitted] (quoting Allis-Chalmers Corp. v. Phila. Elec. Co., 521 F.2d 360, 364 (3d Cir. 1975) [overruled on other grounds by Curtiss-Wright Corp. v. Gen. Elec. Co., 446 U.S. 1 (1980) ] ).'
" 610 F.3d at 855 (emphasis added). The United States Courts of Appeals for the Third and Sixth Circuits have also used the factors identified in MCI Constructors . See, e.g., Berckeley Inv. Group, Ltd. v. Colkitt, 455 F.3d 195, 203 (3d Cir. 2006) ; and Corrosioneering, Inc. v. Thyssen Envtl. Sys., Inc., 807 F.2d 1279, 1283 (6th Cir. 1986).
"Additionally, the United States Courts of Appeals for the Seventh and First Circuits have specifically considered mootness in determining whether there is no just reason for delay in the entry of a judgment under Rule 54(b), Fed. R. Civ. P. See, e.g., Lottie v. West American Ins. Co., 408 F.3d 935, 940 (7th Cir. 2005) ('[W]e might never have to consider at all the bad faith and race discrimination claims if the contract claim is resolved in favor of West American. There would be no reason to consider whether the insurer's breach was so egregious that it amounted to bad faith if there was no breach. Likewise, there would be no reason to consider whether West American breached the contract on account of race if West American did not in fact breach the contract.'); Horn v. Transcon Lines, Inc., 898 F.2d 589, 592 (7th Cir. 1990) ('The possibility that developments in the litigation may moot a claim suggests that appellate resolution be deferred.'); Spiegel v. Trustees of Tufts College, 843 F.2d 38, 44-45 (1st Cir. 1988) ('Should Spiegel prevail on Count IV-and we intimate no view of the matter-she might well have her tenure, her monetary balm, and payment for her litigation expenses. The first three statements of claim would be largely (if not entirely) mooted and the need for appellate review would vanish. Appellate courts, understandably, have treated such a possibility as a major negative in the Rule 54(b) equation.').
"___________________
"5'Federal cases are authoritative in construing the Alabama Rules of Civil Procedure because the Alabama rules were patterned after the Federal Rules of Civil Procedure. Cutler v. Orkin Exterminating Co., 770 So.2d 67, 70 n. 2 (Ala. 2000).' Borders v. City of Huntsville, 875 So.2d 1168, 1176 n. 2 (Ala. 2003). Rule 54(b), Ala. R. Civ. P., is nearly identical to its federal counterpart, Rule 54(b), Fed. R. Civ. P."

Lighting Fair, 63 So.3d at 1264-65 (final emphasis added).

"This Court looks with some disfavor upon certifications under Rule 54(b).
" 'It bears repeating, here, that " '[c]ertifications under Rule 54(b) should be entered only in exceptional cases and should not be entered routinely.' " State v. Lawhorn, 830 So.2d 720, 725 (Ala. 2002) (quoting Baker v. Bennett, 644 So.2d 901, 903 (Ala. 1994), citing in turn Branch v. SouthTrust Bank of Dothan, N.A., 514 So. 2d 1373 (Ala. 1987) )....'
" Dzwonkowski v. Sonitrol of Mobile, Inc., 892 So.2d 354, 363 (Ala. 2004)...."

Schlarb v. Lee, 955 So.2d 418, 419 (Ala. 2006).

Given the current posture of this case, we conclude that the trial court exceeded its discretion by certifying its partial summary judgment as final pursuant to Rule 54(b) because there is a " ' "possibility that the need for review [of that judgment] might ... be mooted by future developments in the [trial] court." ' " Lighting Fair, 63 So.3d at 1264 (quoting MCI Constructors LLC v. City of Greensboro, 610 F.3d 849, 855 (4th Cir. 2010), quoting in turn Braswell Shipyards, Inc. v. Beazer E., Inc., 2 F.3d 1331, 1335 (4th Cir. 1993) ).

The AFTA "provides ... remed[ies] for a creditor who alleges that a debtor has fraudulently transferred assets in order to avoid satisfying the debt." Ex parte HealthSouth Corp., 974 So.2d 288, 293 (Ala. 2007) (emphasis added). However, those remedies are available only to a creditor of the debtor who made the allegedly fraudulent transfer. See id. (noting that " ' "[a] fraudulent conveyance is valid as to all the world except creditors of the grantor" ' " and, thus, that a fraudulent-transfer claimant has no viable claim unless the claimant "fit[s] within the definition of a creditor in the [AFTA]" (quoting Woodard v. Funderburk, 846 So.2d 363, 366 (Ala. Civ. App. 2002), quoting in turn Bank of Lexington v. Jones, 456 So.2d 784, 785 (Ala. 1984) (interpreting the predecessor statute to the AFTA) (emphasis added) ) ). See also §§ 8-9A-4 and -5, Ala. Code 1975 (providing that "[a] transfer made by a debtor is fraudulent as to a creditor" and detailing the circumstances under which such a transfer is deemed fraudulent (emphasis added) ). Thus, Richardson has a potentially viable fraudulent-transfer claim against Rosemarie only if he is a creditor of Ben's.

The AFTA defines "creditor" as "[a] person who has a claim," § 8-9A-1(4), Ala. Code 1975, and defines "claim," in pertinent part, as "[a] right to payment, whether or not the right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured, or unsecured." § 8-9A-1(3), Ala. Code 1975. Thus, Richardson is currently a creditor of Ben's by virtue of his pending claims against Ben regarding the allegedly faulty inspection, despite the fact that those claims have not been adjudicated in Richardson's favor and reduced to judgment. See Granberry v. Johnson, 491 So.2d 926, 928 (Ala. 1986) ("The debtor-creditor relationship is created not by a judgment, but by the wrong which produces the injury .... Hence, a tort claimant is a creditor, and the alleged tortfeasor is the debtor." (interpreting the predecessor statute to the AFTA) (internal citation omitted) ). See also Jesse P. Evans, Alabama Property Rights and Remedies § 31.2 at 31-8 (5th ed. 2012) ("The term 'creditor' is not given a narrow and technical interpretation but a broad and expansive meaning that includes all persons who have a claim, demand, suit, or interest that may be delayed or hindered by the conduct of the debtor." (emphasis added) ). However, although Richardson is not required to reduce his claims against Ben to a judgment in order to obtain creditor status as to Ben, the fact that he has yet to obtain a judgment on those claims is relevant-and, in fact, dispositive, in this case-in determining whether the need for review of the trial court's partial summary judgment on Richardson's claims against Rosemarie might be rendered moot by future developments in the trial court.

In short, Ben's liability to Richardson on the claims arising from the allegedly faulty inspection has yet to be established and, significantly, might never be established. To be clear, we express no opinion on that matter. For our purposes, it is sufficient to note that it is at least possible that Ben will ultimately prevail against Richardson's pending claims against him. If he does, Richardson will no longer have a "right to payment" from Ben, § 8-9A-1(3), and, thus, at that point, will no longer be a creditor of Ben's. § 8-9A-1(4). Cf. Carr v. Guerard, 365 S.C. 151, 616 S.E.2d 429 (2005) (holding that a creditor who had obtained a judgment against the debtor was no longer a creditor of the debtor for purposes of a fraudulent-transfer claim once the judgment expired); and RRR, Inc. v. Toggas, 98 F.Supp.3d 12 (D.D.C. 2015) (same). If Richardson ceases to be a creditor of Ben's after resolution of the pending claims, then he will cease to have a viable fraudulent-transfer claim against Rosemarie. Ex parte HealthSouth Corp., supra . Thus, it is readily apparent that future developments in the trial court could potentially deprive Richardson of his current creditor status as to Ben and, as a result, could potentially moot Richardson's fraudulent-transfer claim against Rosemarie, thereby obviating any need for this Court to review the propriety of the trial court's partial summary judgment in Rosemarie's favor. That possibility, coupled with the disfavor with which this Court views Rule 54(b) certifications, Schlarb, supra, is " 'a major negative in the Rule 54(b) equation' " and " 'suggests that appellate resolution be deferred.' " Lighting Fair, 63 So.3d at 1265 (quoting, respectively, Spiegel v. Trustees of Tufts Coll., 843 F.2d 38, 45 (1st Cir. 1988), and Horn v. Transcon Lines, Inc., 898 F.2d 589, 592 (7th Cir. 1990) ). See Lighting Fair, 63 So.3d at 1265 (holding that a Rule 54(b) certification of a summary judgment in the defendants' favor was improper because the plaintiffs' claim could be rendered moot by resolution of other claims that were pending in arbitration).

Conclusion

Because resolution of Richardson's pending claims against Ben regarding the allegedly faulty inspection could potentially moot the claims adjudicated by the trial court's partial summary judgment, the trial court's Rule 54(b) certification of that judgment was improper. Lighting Fair, supra. Accordingly, we must dismiss the appeal on the basis that it arises from a nonfinal judgment. Stephens, supra.

APPEAL DISMISSED.

Stuart, C.J., and Parker, Main, and Mendheim, JJ., concur.

      Richardson's complaint named additional defendants, but those defendants were eventually dismissed.

      It appears that Good Cents was dissolved approximately two weeks after the trial court's July 2012 order.

      Ben made the transfer in conjunction with a complaint for legal separation he filed in December 2012. Ben and Rosemarie divorced in 2015.

      The parties do not discuss the propriety of the trial court's Rule 54(b) certification. Nevertheless, we address that issue ex mero motu because of the potential jurisdictional bar it raises. See Fuller v. Birmingham-Jefferson Cty. Transit Auth., 147 So.3d 907, 911 (Ala. 2013) ("At the outset, we note that none of the parties argues on appeal that the trial court's certification of its summary-judgment order as final under Rule 54(b) was inappropriate. However, jurisdictional matters, such as whether an order is final so as to support an appeal, are of such importance that an appellate court may take notice of them ex mero motu.").

      Richardson has not alleged that Ben is personally liable on the judgment against Good Cents, a limited-liability company, and that he is therefore a creditor of Ben's by virtue of that judgment, nor has Richardson alleged that he is a creditor of Ben's in any other respect.

      Richardson's conspiracy-to-commit-fraud claim against Rosemarie and his request for discovery of Rosemarie's assets, both of which are grounded on the allegedly fraudulent transfer, would likewise cease to be viable in the absence of a viable fraudulent-transfer claim.


text:
    G.R.L.C. TRUST v. GARRISON DECATUR CROSSINGS, LLC
    1170315
    Supreme Court of Alabama.
    June 15, 2018
    E. Travis Ramey and Brent D. Hitson of Burr & Forman LLP, Birmingham, for appellant.
    James R. Bussian, John C. Neiman, Jr., and Bo Bledsoe of Maynard, Cooper & Gale, P.C., Birmingham, for appellee.
   SELLERS, Justice.

G.R.L.C. Trust ("the Trust"), a trust formed under the laws of Texas, appeals from a summary judgment in favor of Garrison Decatur Crossings, LLC ("Garrison Decatur"), in Garrison Decatur's action for a judgment declaring the need for reformation of a recorded memorandum of lease on the ground of a mutual mistake. We affirm.

On May 31, 2006, the Trust executed a ground lease, leasing to Franklin Land Associates, LLC ("Franklin Land"), real property on which a portion of a shopping center known as "The Crossings of Decatur Shopping Center" is located (hereinafter referred to as "the subject property"). The subject property is the only property the Trust owns in Morgan County. The ground lease was for a term of 50 years and included the option for Franklin Land or its successors to purchase the subject property after 25 years. The ground lease did not initially include a legal description of the subject property. Rather, the parties agreed that, after Franklin Land obtained a survey of the subject property, they would execute an amended ground lease incorporating an "Exhibit A," which would contain the legal description of the subject property as surveyed.

As agreed, Franklin Land and the Trust executed an amended ground lease on August 31, 2006 ("the ground lease"), which now included an Exhibit A with the legal description of the subject property. On that same day, the parties executed a "Memorandum of Ground Lease" ("the lease memorandum"), which states, in pertinent part, that Franklin Land has leased from the Trust certain property "particularly described on Exhibit A attached hereto and incorporated herein."

On September 21, 2006, Franklin Land, as part of its assignment of its leasehold interest in the ground lease to Decatur Investment Partners, GP, a Georgia partnership, recorded the lease memorandum in the Morgan County Probate Office pursuant to § 35-4-6, Ala. Code 1975, providing that leases for more than 20 years are void for the excess over said period unless they are recorded within one year after execution. Although the lease memorandum references Exhibit A as being attached and incorporated into the memorandum, the exhibit was not included with the memorandum when it was recorded.

In 2011, Garrison Decatur began negotiations to acquire the ground lease from Decatur Investments and to become a tenant of the Trust in accordance with the terms of the ground lease and the lease memorandum. In conjunction with the negotiations, Garrison Decatur requested that the Trust warrant that the ground lease was valid and in force. Accordingly, on February 25, 2012, the Trust executed a landlord-estoppel agreement with Garrison Decatur and Wells Fargo Bank, N.A., reciting, in part, that the Trust owned the premises described in Exhibit A, that Garrison Decatur contemplated becoming the lessee under the ground lease, and that Garrison Decatur would borrow a specific amount of money from Wells Fargo Bank, N.A., to acquire its leasehold interest in the subject property and the ground lease from Decatur Investments. The Trust specifically warranted in the landlord-estoppel agreement that the ground lease, having a term of 50 years, was in full force and effect.

In 2015, Garrison Decatur discovered that "Exhibit A," containing the legal description of the subject property, had not been included with the lease memorandum that was on file in the Morgan County Probate Office. Accordingly, Garrison Decatur sued the Trust, seeking (1) the reformation of the lease memorandum to include Exhibit A containing the legal description of the subject property and (2) a judgment declaring that the lease memorandum, as reformed, related back to the date of its original execution. The Trust filed an answer and a counterclaim, seeking a judgment declaring that the ground lease was void for any term beyond 20 years under §§ 35-4-6 and 35-4-51.1, Ala. Code 1975. After engaging in discovery, both Garrison Decatur and the Trust moved for a summary judgment pursuant to Rule 56(c), Ala. R. Civ. P., arguing their respective positions concerning reformation of the lease memorandum to include Exhibit A. The trial court entered a summary judgment in favor of Garrison Decatur, concluding that the evidence was undisputed that Franklin Land and the Trust had intended for the legal description of the subject property to be included with the lease memorandum when the lease memorandum was recorded and that the omission of the legal description from the lease memorandum was the result of an inadvertent mutual mistake on the part of Franklin Land and the Trust. Accordingly, the trial court (1) ordered that the lease memorandum executed on August 31, 2006, be reformed to include Exhibit A; (2) declared that the lease memorandum, as so reformed, related back to the date of its original execution; (3) declared that the lease memorandum, as so reformed, complied with § 35-4-6, Ala. Code 1975, because it had been filed in the probate office within one year of its execution; (4) declared that the amended ground lease was valid and enforceable for its full term of 50 years; and (5) declared that the Trust was estopped from denying that the ground lease was valid and enforceable for its full term of 50 years. The Trust appealed.

Standard of Review and Applicable Law

" 'The standard of review applicable to a summary judgment is the same as the standard for granting the motion....' McClendon v. Mountain Top Indoor Flea Market, Inc., 601 So.2d 957, 958 (Ala. 1992).
" 'A summary judgment is proper when there is no genuine issue of material fact and the moving party is entitled to a judgment as a matter of law. Rule 56(c)(3), Ala. R. Civ. P. The burden is on the moving party to make a prima facie showing that there is no genuine issue of material fact and that it is entitled to a judgment as a matter of law. In determining whether the movant has carried that burden, the court is to view the evidence in a light most favorable to the nonmoving party and to draw all reasonable inferences in favor of that party. To defeat a properly supported summary judgment motion, the nonmoving party must present "substantial evidence" creating a genuine issue of material fact-"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." Ala. Code 1975, § 12-21-12 ; West v. Founders Life Assurance Co. of Florida, 547 So.2d 870, 871 (Ala. 1989).'
" Capital Alliance Ins. Co. v. Thorough-Clean, Inc., 639 So.2d 1349, 1350 (Ala. 1994). Questions of law are reviewed de novo. Alabama Republican Party v. McGinley, 893 So.2d 337, 342 (Ala. 2004)."

Pritchett v. ICN Med. Alliance, Inc., 938 So.2d 933, 935 (Ala. 2006).

Analysis

On appeal, the Trust argues that the trial court erred in reforming the lease memorandum to include Exhibit A, which was omitted when the document was recorded and which contains a legal description of the subject property because, it says, (1) allowing reformation of the lease memorandum thwarts the purpose of the statutory recording requirements; (2) Garrison Decatur failed to show by clear and convincing evidence that omitting the legal description of the property from the lease memorandum when it was recorded was a mutual mistake; (3) the Trust should not be estopped from asserting the invalidity of the lease memorandum or from opposing its reformation; and (4) the trial court exceeded its discretion in striking portions of an affidavit submitted by Kenneth Lee, the trustee of the Trust.

In Alabama, any lease with a term exceeding 20 years must be recorded with the probate court within one year of its execution. Section 35-4-6, Ala. Code 1975, provides:

"No leasehold estate can be created for a longer term than 99 years. Leases for more than 20 years shall be void for the excess over said period unless the lease or a memorandum thereof is acknowledged or approved as required by law in conveyances of real estate and recorded within one year after execution in the office of the judge of probate in the county in which the property leased is situated."

Section 35-4-51.1 provides, in pertinent part, that a "memorandum of a lease may be recorded in lieu of the lease itself if the memorandum is executed and acknowledged by the lessor and the lessee" and contains, among other things, "[t]he specific legal description of the leased premises." In this case, Franklin Land recorded the lease memorandum within one year of its execution in compliance with § 35-4-6. However, the lease memorandum did not include a legal description of the subject property as required by § 35-4-51.1. As indicated, the trial court reformed the lease memorandum to include Exhibit A, containing the legal description of the subject property, on the basis that the omission of the exhibit was the result of an inadvertent mutual mistake on the part of Franklin Land and the Trust.

It is well settled in property law that a trial court may exercise its equitable powers to reform a written instrument that, through a mutual mistake, does not truly express the intention of the parties. See § 35-4-153, Ala. Code 1975. In Fadalla v. Fadalla, 929 So.2d 429 (Ala. 2005), this Court explained:

" 'The general rule in Alabama is that a court may exercise its equitable powers to reform [an instrument] to make it conform to the intention of the parties.' Powell v. Evans, 496 So.2d 723, 725 (Ala. 1986) ; Clemons v. Mallett, 445 So.2d 276, 278 (Ala. 1984). One of the grounds for reformation of a [recorded instrument] is mutual mistake of the parties. Long v. Vielle, 549 So.2d 968, 970-71 (Ala. 1989). A mutual mistake exists when the parties have entered into an agreement, but the [instrument] does not express what the parties intended under the agreement. Daniels v. Johnson, 539 So.2d 259, 260 (Ala. 1989). In determining whether a mutual mistake exists, '[t]he initial factual question is, of course, what the parties intended the instruments to express at the time they were executed.' Jim Walter Homes, Inc. v. Phifer, 432 So.2d 1241, 1242 (Ala. 1983) (citing Behan v. Friedman, 218 Ala. 513, 119 So. 20 (1928) ). However, the trial court ' "cannot make a new [instrument] for the parties, nor establish that as a[n] [instrument] between them, which it is supposed they would have made, if they had understood the facts." ' 432 So.2d at 1242 (quoting Holland Blow Stave Co. v. Barclay, 193 Ala. 200, 206, 69 So. 118, 120 (1915) )...."

929 So.2d at 434. The party seeking to reform an instrument on the basis of a mutual mistake bears the burden of proving by "clear, exact, convincing, and satisfactory evidence that the intention he seeks to substitute was that of both parties." Beasley v. Mellon Fin. Servs. Corp., 569 So.2d 389, 394 (Ala. 1990).

In support of its summary-judgment motion, Garrison Decatur submitted as an exhibit the landlord-estoppel agreement, in which the Trust represented to Garrison Decatur and Wells Fargo that it owned the subject property described in "Exhibit A" and that the ground lease, previously recited as having a term of 50 years, was in full force and effect. According to Garrison Decatur, the Trust was estopped from opposing reformation of the lease memorandum based on those representations in the landlord-estoppel agreement. Garrison Decatur also submitted as an exhibit to its summary-judgment motion the lease memorandum executed by Franklin Land and the Trust, which expressly states that Franklin Land has leased from the Trust certain property "particularly described on Exhibit A attached hereto and incorporated herein." In order to demonstrate that the omission of Exhibit A from the lease memorandum was a mutual mistake, Garrison Decatur submitted with its motion the depositions of Tom Caddell, the attorney who prepared the lease memorandum, and Kenneth Lee, the trustee of the Trust who executed the lease memorandum on behalf of the Trust. Caddell stated in his deposition that the lease memorandum was intended to incorporate Exhibit A; that Exhibit A was intended to provide a legal description of the subject property the Trust had leased to Franklin Land; and that, although Exhibit A was intended by the parties to be attached and incorporated into the lease memorandum, the exhibit was omitted by mistake. Likewise, Lee stated in his deposition that the terms of the ground lease provided that the lease memorandum should contain a legal description of the subject property; that the description of the subject property was supposed to be attached to the lease memorandum; and that, when he signed the lease memorandum, he did not realize that Exhibit A containing the legal description of the subject property was missing. Lee finally confirmed in his deposition that there was no evidence to dispute the argument that the omission of Exhibit A from the lease memorandum was anything other than a mistake. Accordingly, the burden then shifted to the Trust to present substantial evidence demonstrating that the omission of Exhibit A from the lease memorandum was not the result of a mutual mistake.

In support of its argument that the omission of Exhibit A from the lease memorandum was not the result of a mutual mistake, the Trust offered Lee's affidavit, which undisputedly contradicted his deposition testimony. Lee stated in the affidavit, among other things, that the Trust did not draft or otherwise have any input into the lease memorandum presented by Franklin Land; that the Trust did not intend for the lease memorandum to contain or to be anything different than the document Franklin Land had presented to it; and that it was the Trust's position that it did not make any mistake with regard to the lease memorandum. Contrary to the Trust's argument on appeal, the trial court properly struck those portions of Lee's affidavit that were not based on personal knowledge, that purported to express opinions about the parties' intentions that he was not qualified to express, and that attempted to color or qualify his earlier deposition testimony. See McGough v. G & A, Inc., 999 So.2d 898, 904 (Ala. Civ. App. 2007) (noting that "[t]he court may not consider deposition or affidavit testimony that directly contradicts earlier deposition or affidavit testimony without adequate explanation"). Accordingly, the trial court correctly determined that Lee's affidavit testimony did not constitute substantial evidence disputing Garrison Decatur's evidence indicating that Franklin Land and the Trust had a clear meeting of the minds about the description of the subject property as set forth in Exhibit A and that the parties intended for Exhibit A to be attached to and included in the lease memorandum.

The Trust seemingly ignores the undisputed evidence presented by Garrison Decatur in favor of reformation by arguing that a person who seeks to record a memorandum must strictly comply with both § 35-4-6 and § 35-4-51.1. The Trust argues that because the lease memorandum failed to comply with § 35-4-51.1 by including a legal description of the subject property, the lease memorandum was not a "memorandum" within the meaning of § 35-4-6 and, therefore, could not be recorded at all under § 35-4-6. For this reason, the Trust argues that that portion of the ground lease exceeding 20 years is void. The Trust relies heavily on Ex parte Achenbach, 783 So.2d 4, 7 (Ala. 2000) (holding that, because "a lease that [was] made for more than 20 years and that [was] not properly recorded, [was] void for any portion of that lease period that exceed[ed] 20 years," the co-owner of the lease could not be estopped from asserting that the lease was void). The Trust's reliance on Ex parte Achenbach is clearly misplaced because that case did not involve the issue of reformation, and, more specifically, the lease in that case was not recorded within one year of its execution; thus, under § 35-4-6, that portion of the lease exceeding 20 years was void. Here, the lease memorandum was timely recorded, albeit missing Exhibit A. As indicated, § 35-4-51.1 provides that a "memorandum of a lease may be recorded in lieu of the lease itself if the memorandum is executed and acknowledged by the lessor and the lessee" and contains, among other things, "[t]he specific legal description of the leased premises." As the trial court noted, the statute states nothing about the legal significance of a lease memorandum that is timely recorded in the probate office but is missing one of the items specifically referenced in the memorandum as being "attached hereto and incorporated herein." In other words, the statute does not contemplate that a timely recorded lease memorandum, omitting the legal description of the property, is to be treated as nullity as if it had never been recorded, especially where, as here, clear and convincing evidence exists that Franklin Land and the Trust knew Exhibit A existed, agreed with the legal description contained on the exhibit, and intended for the exhibit to be attached to and incorporated into the lease memorandum. This is simply not a case where the trial court was rewriting the lease memorandum to say something other than what was intended by Franklin Land and the Trust. Nor could the lease memorandum cause any confusion. From all the evidence before the trial court, it is clear that the failure to attach Exhibit A was merely a ministerial or administrative error. The other formalities of the lease memorandum were satisfied such that any party desiring to establish title to the subject property would know with certainty that the only property owned by the Trust in Morgan County was subject to a long-term lease. Accordingly, the trial court did not err in reforming the lease memorandum to include Exhibit A containing the legal description of the subject property.

Conclusion

The finding of the trial court that there had been a mutual mistake in omitting Exhibit A from the lease memorandum is supported by the evidence; therefore, the summary judgment in favor of Garrison Decatur reforming the lease memorandum is affirmed.

AFFIRMED.

Stuart, C.J., and Bolin, Shaw, and Wise, JJ., concur.

Sellers, J., concurs specially.

SELLERS, Justice (concurring specially).

I concur in the main opinion, which I authored. I write specially to express my opinion that this lawsuit should never have been filed. The real issue presented in this appeal is whether the failure to attach an exhibit to a memorandum of a lease was so material, confusing, or misleading as to limit the term of the 50-year ground lease to 20 years. Factually, in addition to executing the ground lease, the parties also executed a memorandum of lease summarizing the significant terms and conditions of the ground lease. In lieu of recording the ground lease, Franklin Land Associates, LLC, pursuant to § 35-4-51.1, Ala. Code 1975, opted to record the memorandum of lease. The parties agree that the memorandum of lease complies with § 35-4-51.1, except that the legal description of the property, which was to be attached to the memorandum as "Exhibit A," was inadvertently omitted when the memorandum of lease was filed of record. Exhibit A contained the same surveyed legal description of the subject property that was attached to the ground lease executed by the parties. Further, because the property described on "Exhibit A" was the only property G.R.L.C. Trust ("the Trust") owned in Morgan County, the legislative intent of providing notice of the lengthy leasing of real property was effectively accomplished.

For reasons that can be attributed only to greed, the Trust argues that the memorandum of lease failed because of the omission of Exhibit A and was void-thus limiting the term of the ground lease to 20 years rather than the agreed-upon 50 years. In other words, the Trust argues that the failure to attach Exhibit A, the content of which was not in dispute, to the memorandum of lease was so egregious that a multimillion-dollar transaction was called into question by a ministerial act or curable error.

Rather than fix this minor defect, the parties opted to use the court system to declare the obvious outcome. In other words, this matter could have been handled expeditiously had Garrison Decatur Crossings, LLC, simply attached Exhibit A to the memorandum of lease, paid the minimum filing fee (probably less than $25), and re-recorded the memorandum of lease (probably less than an hour of time). There is no disagreement here about the terms of the ground lease or any concerns about the elements of formation giving rise to the lease. The description of the subject property contained in the missing Exhibit A is not in dispute. The only concern in our over-litigious society is the validity of the memorandum of lease when there is a clerical mistake. Although the trial court's decision was absolutely correct, it is a shame that rational actors, including lawyers, did not resolve this minor problem by showing leadership, if not legal prowess, and simply re-recording the memorandum of lease with Exhibit A attached.


author: SHAW, Justice.

text:
    Jimmy Larry BEDDINGFIELD et al. v. MULLINS INSURANCE COMPANY et al.
    1170143
    Supreme Court of Alabama.
    June 15, 2018
    L. Thompson McMurtrie and Dustin W. Kennemer of McMurtrie Kennemer, LLC, Huntsville.
    Submitted on appellants' brief only.
   SHAW, Justice.

The plaintiffs below, Jimmy Larry Beddingfield ("Larry"), his wife, Rebecca M. Beddingfield ("Rebecca"), and their adult son, James Cody Beddingfield ("Cody") (hereinafter referred to collectively as "the Beddingfields"), appeal from a summary judgment in favor of the defendants below, Mullins Insurance Company, Mullins & Company Insurance, Rand Mullins, and David Mullins (hereinafter referred to collectively as "Mullins"), on the Beddingfields' claims stemming from Mullins's alleged failure to properly procure insurance coverage. We affirm the trial court's judgment in part, reverse it in part, and remand.

Facts and Procedural History

Mullins Insurance Company and Mullins & Company Insurance are "licensed insurance brokerage[s] or agenc[ies]" operating in Huntsville; Rand Mullins and David Mullins are licensed insurance or brokerage agents employed by those entities. In 1997, Larry and Rebecca purchased a $300,000 homeowners' liability-insurance policy from Rand Mullins that protected Larry and Rebecca's primary residence. In 2001, Larry and Rebecca purchased a second liability-insurance policy in the amount of $100,000 that provided coverage for a rental house located in Florence; they later constructed another house in Guntersville and, in 2003, purchased an additional $100,000 liability-insurance policy from Rand Mullins for that property. All three policies Rand Mullins procured for Larry and Rebecca were initially obtained from Vesta Insurance Corporation; they were later replaced by policies issued by The Shelby Insurance Company ("SIC").

In July 2003, Mullins canceled the insurance policy on the Florence house allegedly based on a belief that "the policy was issued in duplicate." Allegedly unbeknownst to Larry and Rebecca, however, the requested cancellation left the Florence house uninsured. One month later, pursuant to a mortgage refinance on the Beddingfields' residence, Larry and Rebecca paid $1,629 to Mullins, representing one year's insurance premium on that residence; the check was endorsed and deposited into Mullins's account. In March 2004, the policy on the Beddingfields' residence was canceled because of nonpayment of the premium; neither Larry nor Rebecca, however, was able to recall receiving notice of the cancellation. After those two events, Larry and Rebecca were without insurance on their residence and the Florence house, leaving them with liability insurance only on their Guntersville house in the amount of $100,000.

In July 2004, a minor guest at the Beddingfields' Guntersville house, Trace Rex Linam, suffered a serious eye injury in a fireworks-related incident. In 2008, Linam and his father, Charles Gary Linam, sued the Beddingfields, alleging that they, and particularly Cody, who was a minor at the time, were responsible for the injury (this action is hereinafter referred to as "the Linam litigation"). Because SIC had been placed into receivership in Texas in 2006, the Alabama Insurance Guaranty Association ("AIGA") covered the Beddingfields' legal-defense costs in the Linam litigation; however, the maximum amount of liability coverage available was limited to $100,000-the amount of the liability-insurance policy Larry and Rebecca had obtained from Mullins to insure that property-and not $500,000, the amount they say would have been available had the other two policies not been canceled. See § 27-42-8(a)(1), Ala. Code 1975 (obligating AIGA to cover "claims existing prior to the determination of [an insurer's] insolvency and arising within 30 days after the determination of insolvency, or before the policy expiration date if less than 30 days after the determination" but limiting AIGA's obligation to the amount of "the obligation of the insolvent insurer under the policy from which the claim arises"). In February 2011, a judgment was entered on a $600,000 jury verdict against the Beddingfields in the Linam litigation. The Beddingfields appealed that decision to this Court. Because, however, AIGA did not post the requisite supersedeas bond-allegedly because SIC was in receivership-and the Beddingfields were allegedly unable to obtain a bond, execution of the judgment was not stayed during the pendency of the appeal.

In July 2011, while their appeal was pending, the Beddingfields sued Mullins in the Madison Circuit Court. The complaint alleged numerous counts of negligence and wantonness with relation to Mullins's handling of the various insurance policies. Specifically, Counts I and II, which related to the Florence house, alleged that Mullins had negligently and/or wantonly "failed to reasonably review coverages provided by" the insurance policy on that property. More specifically, it alleged:

"[Mullins] negligently cancelled the insurance policy which provided liability insurance coverage in the amount of $100,000.00, and instead continued in force and effect an insurance policy providing no liability insurance coverage.
"... Had said coverage been in force and effect it would have provided additional insurance monies for settlement on behalf of the Beddingfields, or payment of a judgment against the Beddingfields [in the Linam litigation]."

Counts III and IV of the complaint, which related to the Beddingfields' residence, alleged that Mullins had negligently and/or wantonly failed to pay the premium for the homeowners' insurance coverage despite having received the premium and that, as a result, the policy had been canceled, resulting in alleged mental anguish and property loss. Counts V and VI related to Mullins's decision to procure the Beddingfields' coverage from SIC and alleged that Mullins had negligently and/or wantonly failed to warn the Beddingfields of SIC's precarious financial situation, its poor risk rating, and the potential consequences of obtaining insurance from such an insurance company. Counts VII and VIII alleged that Mullins had negligently and/or wantonly "appropriated the insurance premiums provided by the Beddingfields for their residence," resulting in the lapse of the Beddingfields' homeowners' policy and a corresponding reduction in available liability-insurance coverage. Finally, Counts IX and X of the complaint alleged that Mullins had negligently and/or wantonly "failed to advise the Beddingfields of their need to obtain personal umbrella liability insurance coverage to protect their substantial assets from potential risks of loss." The Beddingfields sought unspecified damages in connection with each of the above-described claims. Mullins filed an initial answer generally denying liability and asserting numerous affirmative defenses to the Beddingfields' claims.

In 2013, this Court issued its decision in the appeal in the Linam litigation. See Beddingfield v. Linam, 127 So.3d 1178 (Ala. 2013). Specifically, this Court reversed the trial court's judgment and, as to the Linams' claims of negligent entrustment, negligent supervision, and wanton supervision, rendered a judgment in favor of Larry and Rebecca. 127 So.3d at 1191. Thus the claims against Larry and Rebecca in the Linam litigation were concluded in their favor. The Court also rendered judgment in favor of Cody on the Linams' strict-liability claim, but remanded the matter for a new trial on their negligence, wantonness, and assault claims against him. Id. Following that remand, the remaining claims were apparently settled and the action was ultimately dismissed.

In 2016, Mullins filed a motion for a summary judgment. Mullins attached to its motion, among other things, a notice dated March 4, 2004, which reflected the cancellation of the liability policy on the Beddingfields' residence effective March 19, 2004, and which was allegedly mailed to Larry and Rebecca at the address of their residence. Also attached was a follow-up "confirmation of cancellation," which was allegedly mailed to Larry and Rebecca on March 31, 2004.

In its motion, Mullins argued that it was entitled to a summary judgment on all of the Beddingfields' claims, both because the claims were allegedly filed after the expiration of the applicable two-year limitations period and because the Beddingfields had allegedly "sustained no damages." More specifically, Mullins alleged:

"1. The Beddingfields knew as early as at least 2008, that there were potential coverage gaps in their insurance because the AIGA, and not [SIC], provided the[ir] defense. ...
"2. Following an appeal by the Beddingfields ... [in the Linam litigation], the Alabama Supreme Court on March 8, 2013 reversed and rendered the verdict as to [Larry and Rebecca] and remanded the claims against Cody back to the trial court for a retrial.
"3. In April 2016, all of [the] remaining claims against Cody [in the Linam litigation] were settled and there is no longer any threat of any Judgement against [any of the Beddingfields].
"4. ...[T]he Beddingfields ... have [not] had to pay or will have to pay any of their own personal money for defense or settlement costs of the [ Linam litigation]...."

According to Mullins's summary-judgment motion, under Alabama law, all claims arising from the alleged failure to procure insurance coverage accrue when a loss triggering coverage occurs and the insurer refuses to cover the loss. Thus, Mullins argued, the Beddingfields' claims against Mullins accrued at the very latest at the time of-but arguably well before-the filing of the Linam litigation in May 2008 when the Beddingfields learned that AIGA, not SIC, was providing a defense; therefore, according to Mullins, the statute of limitations for the Beddingfields' current action expired in May 2010, before their initiation of the action in July 2011. Mullins further argued that the Beddingfields, in their respective depositions, admitted that their damages would be only those resulting from liability in the Linam litigation. Because, Mullins alleges, the Linam litigation settled without the Beddingfields actually having incurred any related out-of-pocket expenses, Mullins contended that they were not in fact damaged.

The Beddingfields moved to strike the cancellation notices attached as exhibits to Mullins's summary-judgment motion, which request the trial court granted. In further opposition to Mullins's motion, the Beddingfields attempted to demonstrate the existence of a question of material fact precluding summary judgment. Specifically, relying on certain exhibits, including affidavit and deposition testimony from the Beddingfields and their counsel in the Linam litigation, they argued that there remained a question as to when their causes of action accrued. Contrary to Mullins's assertions, they contended that their negligent-procurement claims did not accrue until a claim for insurance benefits was denied-an event they asserted never actually occurred in this case. The Beddingfields subsequently filed an additional response disputing that knowledge of SIC's receivership alerted them to Mullins's alleged breach of duty and arguing that their first legal injury instead occurred either when the plaintiffs in the Linam litigation initially refused a policy-limits settlement offer in October 2009 or when the jury, in February 2011, returned its verdict, which exceeded available policy limits.

The Beddingfields also contended that, under Alabama law, a tort-based cause of action accrues only when actual damage is sustained. They argued alternatively that they suffered legal injury either when the Linams refused to settle for the limits of the policy or when the jury returned its verdict. Thus, according to the Beddingfields, their July 11, 2011, filing was clearly within the two-year statute of limitations.

In their motion and accompanying exhibits, the Beddingfields conceded a complete "lack of damage[ ] prior to the verdict rendered against them in the Linam suit." They explained, however, that, during their appeal of the resulting judgment and based on the absence of a supersedeas bond, the Linams undertook efforts to seize their personal assets, which required them to hire outside legal counsel and to incur approximately $15,000 in legal fees and expenses. The Beddingfields further testified that, as a result of the garnishment efforts and the related damage to his credit, Larry was unable to pay for liability insurance and other expenses necessary to maintain his general contractor's license. Affidavit testimony from an economist retained by the Beddingfields estimated Larry's lost business income at $795,223.71.

Subsequent to a hearing, the trial court, without indicating the findings on which its ruling was based, entered an order granting Mullins's summary-judgment motion. The Beddingfields appealed.

Standard of Review

" ' "This Court's review of a summary judgment is de novo. Williams v. State Farm Mut. Auto. Ins. Co., 886 So.2d 72, 74 (Ala. 2003). We apply the same standard of review as the trial court applied. Specifically, we must determine whether the movant has made a prima facie showing that no genuine issue of material fact exists and that the movant is entitled to a judgment as a matter of law. Rule 56(c), Ala. R. Civ. P.; Blue Cross & Blue Shield of Alabama v. Hodurski, 899 So.2d 949, 952-53 (Ala. 2004). In making such a determination, we must review the evidence in the light most favorable to the nonmovant. Wilson v. Brown, 496 So.2d 756, 758 (Ala. 1986). Once the movant makes a prima facie showing that there is no genuine issue of material fact, the burden then shifts to the nonmovant to produce 'substantial evidence' as to the existence of a genuine issue of material fact. Bass v. SouthTrust Bank of Baldwin County, 538 So.2d 794, 797-98 (Ala. 1989) ; Ala. Code 1975, § 12-21-12. '[S]ubstantial 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 Assur. Co. of Fla., 547 So.2d 870, 871 (Ala. 1989)." '
" Prince v. Poole, 935 So.2d 431, 442 (Ala. 2006) (quoting Dow v. Alabama Democratic Party, 897 So.2d 1035, 1038-39 (Ala. 2004) )."

Brown v. W.P. Media, Inc., 17 So.3d 1167, 1169 (Ala. 2009).

Discussion

The Beddingfields contend that the trial court erred in entering a summary judgment for Mullins. More specifically, they argue, as they did below in response to Mullins's statute-of-limitations argument, that the earliest their negligence and wantonness claims against Mullins could have accrued was October 2009 when the Linams refused the policy-limits settlement offer extended to them following the initiation of the Linam litigation and that they timely filed their action within two years of that date. Additionally, they maintain that they presented sufficient evidence of their resulting damage so as to defeat summary judgment on this alternate ground.

I. Damage

"Damages are an essential element of the [Beddingfields'] tort [claims]" and, thus, "[p]roof of damage [is] an essential part of [their] case." Davis v. Hanson Aggregates Southeast, Inc., 952 So.2d 330, 335 (Ala. 2006) (internal quotation marks omitted). Other courts have suggested that the mere failure to properly procure requested insurance coverage is not actionable in every instance:

"So it is that a negligence action may be maintained against an insurance agent or broker who undertakes to procure an insurance policy and fails to do so, ... but not unless there has been some appreciable harm to the potential insured. ... The failure to obtain insurance obviously will not cause injury in every case. If no accident produces a claim, the failure will have been negligence in the abstract. ... Some courts have said that legal injury has not occurred until the insured actually suffers the unprotected loss. ... In those actions in negligence, the requirement that the plaintiff sustain appreciable harm was met when the plaintiff incurred expenses, most often associated with employing a new lawyer to prosecute or defend against an action which would not have occurred but for the defendant-attorney's negligence. ... It might be supposed that [the] consciousness of contingent liability was damage enough, but the authorities are chary of treating the threat of future harm without realization of some tangible harm, like out-of-pocket payments, as the basis for concluding that damage has occurred and the cause of action has accrued. ..."

International Mobiles Corp. v. Corroon & Black/Fairfield & Ellis, Inc., 29 Mass. App. Ct. 215, 218-19, 560 N.E.2d 122, 124-25 (1990) (footnote omitted). Similarly, in Campbell v. Naman's Catering, Inc., 842 So.2d 654 (Ala. 2002), this Court affirmed a summary judgment for an employer where, although the insured did not have coverage for a time as the result of the employer's failure to remit premiums for life and disability insurance to the insurer, no claim resulted during that time; thus, the insured "provided no evidence of damages stemming from the failure to pay the insurance premiums." 842 So.2d at 658.

Here, the Beddingfields presented substantial evidence to support their allegations of damage resulting from Mullins's purported negligent procurement of insurance in the form of, among other things, attorneys' fees and business losses attributable to the Linam litigation and Mullins's alleged failures identified in their complaint. Thus, Mullins's argument below that the Beddingfields were not damaged was not a meritorious basis for the entry of a summary judgment.

II. Statute of Limitations

The Beddingfields argue that the summary judgment was inappropriate if it was based on Mullins's argument that their claims were time-barred. The parties appear to be in agreement that, as to the Beddingfields' negligence claims, a two-year statute of limitation applies. See note 1, supra. The only issue remaining is the accrual date of the Beddingfields' claims, at which point the limitations period began to run.

The Court has previously explained:

" Weninegar[ v. S.S. Steele & Co., 477 So.2d 949 (Ala. 1985),] involved a negligence claim against an insurance agent for allowing a flood insurance policy to lapse. We held that no legal injury occurred until the plaintiffs' house was flooded and the insurer refused to cover the loss, and we cited cases from four other jurisdictions in support of this rule. Weninegar, 477 So.2d at 956 (citing Austin v. Fulton Ins. Co., 444 P.2d 536 (Alaska 1968) ; Wolfswinkel v. Gesink, 180 N.W.2d 452 (Iowa 1970) ; Spurlin v. Paul Brown Agency, Inc., 80 N.M. 306, 454 P.2d 963 (1969) ; and Kunz v. Buckeye Union Ins. Co., 1 Ohio St. 3d 79, 437 N.E.2d 1194 (1982) ).
"We find no compelling reason to apply Weninegar in cases of negligent lapse and not in cases of negligent procurement as well. The four cases cited in Weninegar for the rule that the action accrues when the loss occurs, Austin, Wolfswinkel, Spurlin, and Kunz, each involved a claim for negligent procurement, not negligent lapse. ... We hold that [a negligent-procurement] action accrues when the loss occurs."

Hickox v. Stover, 551 So.2d 259, 264 (Ala. 1989), overruled on other grounds by Foremost Ins. Co. v. Parham, 693 So.2d 409 (Ala. 1997) (emphasis added). Further, in Bush v. Ford Life Insurance Co., 682 So.2d 46, 47 (Ala. 1996), this Court held, citing Weninegar v. S.S. Steele & Co., 477 So.2d 949 (Ala. 1985), that a cause of action based on negligent procurement accrues "when a loss that would trigger liability under the policy occurs" and the insurer notifies the insured that it will not honor the claim. Citing Bush, the Beddingfields contend that SIC's receivership status did not constitute a denial of their insurance claim and that they were never denied insurance coverage.

In this case, the incident underlying the Linam litigation occurred on July 2, 2004. Before that, in 2003, the policy on the Florence rental house had been allegedly erroneously canceled by Mullins, and the policy on their residence was canceled in 2004 as the result of Mullins's alleged misappropriation or misapplication of the submitted premium. Trace Linam did not actually sue the Beddingfields until May 23, 2008. At the time the Linam litigation was initiated, the Beddingfields were provided a defense; however, that defense was only to the limits of the $100,000 policy covering the Guntersville house, and the Beddingfields were actually denied access to the additional policy coverages of $400,000 that, but for Mullins's tortious conduct, would otherwise have been available to them. The notice of the unavailability of those additional proceeds constituted, for all intents and purposes, a denial of the Beddingfields' claims for benefits under those policies, i.e., the policy proceeds were never extended to them for their use. Cf. Congress Life Ins. Co. v. Barstow, 799 So.2d 931, 938 (Ala. 2001) ("An insurance company's denial of a claim may be either 'express' ('actual') or 'constructive.' ... 'In Alabama, a plaintiff can establish a constructive denial in two ways: "(1) by showing that the passage of time is so great that the delay alone creates a denial; or (2) by showing sufficient delay in payment coupled with some wrongful intent by the insurance company." ' " (quoting State Farm Fire & Cas. Co. v. Slade, 747 So.2d 293, 317 n. 6 (Ala. 1999) ) ). Although Larry was unable to specify the exact date, he did concede that "shortly after" the Beddingfields were sued in the Linam litigation, he "learn[ed] that [they did not] have the five hundred thousand dollars of insurance [they] thought [they] had" and that they were "short essentially four hundred thousand dollars in coverage." Although it is true that the Beddingfields still had insurance during the litigation and that their insurance coverage was never denied, they did not have the insurance they claimed that they should have had if not for Mullins's allegedly tortious conduct. Here, the Beddingfields filed their negligent-procurement action on July 17, 2011-more than three years after the Linam litigation was instituted against them and they learned about their shortfall in coverage. Their negligence claims are thus untimely under the two-year statute of limitations. The trial court, applying the foregoing accrual principles, correctly entered a summary judgment in favor of Mullins on the Beddingfields' negligence claims; that portion of the trial court's judgment is, therefore, due to be affirmed.

A different analysis, however, is required as to the Beddingfields' wantonness claims. They contend that, applying this Court's decision in Ex parte Capstone Building Corp., 96 So.3d 77 (Ala. 2012), because their wantonness claims accrued before June 3, 2011, their claims were timely as long as they were filed before June 2013. We agree.

In Ex parte Tate & Lyle Sucralose, Inc., 81 So.3d 1217 (Ala. 2011), applying the rule of Ex parte Capstone, supra, the Court explained:

"This Court has applied to wantonness claims both the two-year limitations period provided in Ala. Code 1975, § 6-2-38(l ), see, e.g., Boyce v. Cassese, 941 So.2d 932, 945 (Ala. 2006), and the six-year period provided in Ala. Code 1975, § 6-2-34(1), see McKenzie v. Killian, 887 So.2d 861 (Ala. 2004). To resolve this discrepancy, this Court, in Ex parte Capstone Bldg. Corp., [Ms. 1090966, June 3, 2011] (Ala. 2011), overruled McKenzie to the extent it held that the six-year statute of limitations found in § 6-2-34(1) applied to a claim of wantonness and 'reaffirm[ed] the proposition that wantonness claims are governed by the two-year statute of limitations now embodied in § 6-2-38(l ).' We specified in Capstone, however, that 'litigants whose causes of action have accrued on or before the date of this decision [i.e., June 3, 2011] shall have two years from today's date to bring their action unless and to the extent that the time for filing their action under the six-year limitations period announced in McKenzie would expire sooner.' "

81 So.3d at 1222-23 (emphasis added; note from reporter of decisions omitted). See also Ex parte Novus Utils., Inc., 85 So.3d 988, 995 n.1 (Ala. 2011).

Here, as set out above, the Beddingfields' claims accrued at the time the Linam litigation was initiated in May 2008 and the Beddingfields were denied the entirety of the insurance benefits they had engaged Mullins to procure. Under Ex parte Capstone, because their claims accrued before June 3, 2011, the Beddingfields are correct that they had until June 3, 2013, to file suit, unless the six-year statute of limitations previously applied under Alabama law had expired earlier, which it did not in this case. The Beddingfields' wantonness claims were filed in July 2011, well within the two-year period prescribed in Ex parte Capstone. Because the wantonness claims were commenced against Mullins within the two-year savings period that must be applied under Ex parte Capstone, the wantonness claims are not time-barred.

Based on the foregoing, we affirm the summary judgment as to the negligence claims, reverse the summary judgment as to the wantonness claims, and remand the case.

AFFIRMED IN PART; REVERSED IN PART; AND REMANDED.

Stuart, C.J., and Bolin, Wise, and Sellers, JJ., concur.

      See § 6-2-38(l ), Ala. Code 1975.

      Following the filing of the notice of appeal, Mullins's counsel filed a motion requesting leave from this Court to withdraw from representation; according to that motion, the insurance company that had issued the policy under which Mullins's counsel had been retained rescinded the policy and withdrew both its defense and indemnification. This Court granted permission for the requested withdrawal and issued an order directing Mullins to indicate whether it intended to obtain replacement counsel or to proceed pro se. Mullins's response explained that, because of a lack of financial resources, it was unable to obtain counsel; Mullins, therefore, did not file a brief on appeal.

      As explained elsewhere, the Beddingfields also argue that their claims did not accrue until February 2011, when a judgment was entered in the Linam litigation.

      To the extent that the Beddingfields purport to rely on Jones v. Alfa Mutual Insurance Co., 1 So.3d 23 (Ala. 2008), as support for their argument that disputed facts surrounding the date of accrual of a cause of action for statute-of-limitations purposes presents a jury question, Jones involved a bad-faith, rather than a negligent-procurement, claim and is therefore inapposite. See 1 So.3d at 29-30.

      According to the Beddingfields, they provided notice of a claim to Mullins when the incident occurred.

      The Beddingfields also indicated that, upon being served with initial service of process in the Linam litigation, they immediately notified "[their] insurance company" and Mullins.