author: SELLERS, Justice.

text:
    Homer L. WATSON, as personal representative of the Estate of Mary Fejeran, deceased v. The UNIVERSITY OF ALABAMA HEALTH SERVICES FOUNDATION, P.C., and Graham C. Towns, M.D.
    1170057
    Supreme Court of Alabama.
    April 27, 2018
    F. Patrick Loftin of Loftin, Loftin & May, Phenix City, for appellant.
    Michael D. McKibben and Ty E. Dedmon of Bradley Arant Boult Cummings LLP, Birmingham; and Scott Burnett Smith and Angela M. Shaefer of Bradley Arant Boult Cummings LLP, Huntsville, for appellees.
   SELLERS, Justice.

Homer L. Watson, as personal representative of the estate of Mary Fejeran, deceased, appeals from the summary judgment entered by the Jefferson Circuit Court in a wrongful-death action in favor of the University of Alabama Health Services Foundation, P.C., and Graham C. Towns, M.D. (hereinafter referred to collectively as "the defendants"). We affirm.

The facts are undisputed. On November 8, 2012, Fejeran died. Watson thereafter petitioned the Russell Probate Court for letters of administration, seeking to be appointed the personal representative of Fejeran's estate. On August 22, 2013, the probate court issued letters of administration to Watson.

In March 2014, Watson petitioned the probate court for a final settlement of Fejeran's estate, representing that he had discharged in full all legal claims against the estate, that he had made a final distribution of all the personal assets of the estate, and that he was requesting a final order discharging and releasing him and the surety on his bond from further liability as personal representative of the estate.

On March 24, 2014, the probate court entered a judgment of final settlement, indicating that Watson and his surety were "discharged from all further liabilities."

On November 7, 2014, Watson, after being discharged and released as the personal representative of Fejeran's estate, filed a wrongful-death action against the defendants under § 6-5-410, Ala. Code 1975. Watson claimed in that action that he was "the duly qualified Administrator" of Fejeran's estate. The two-year limitations period for bringing a wrongful-death action under the statute expired on November 8, 2014.

On March 7, 2017, the defendants filed a motion for a summary judgment pursuant to Rule 56, Ala. R. Civ. P., on the basis that Watson lacked the representative capacity to bring the wrongful-death action. In support of their summary-judgment motion, the defendants attached a copy of the March 24, 2014, final-settlement order indicating that Watson had been discharged as the personal representative of Fejeran's estate.

On March 23, 2017, Watson moved the probate court to clarify its March 24, 2014, order or, alternatively, to correct a clerical error in the order pursuant to Rule 60(a), Ala. R. Civ. P. Watson specifically alleged in his motion to clarify and/or to correct that his petition for final settlement sought relief only for liability arising from estate-administration activities and that the petition did not seek closure of the estate or termination of his letters of administration. On the same day, the probate court entered an order, dated March 23, 2017, purporting to clarify and/or to correct its March 24, 2014, order:

"1. In response to the Administrator's motion for clarification, the Court declares that the meaning and intent of its March 24, 2014, order was to grant a discharge from liabilities for estate administration activities, but to otherwise leave Mr. Watson's letters of administration in full force and effect. Thus, on November 7, 2014, when an action for Mary Fejeran's wrongful death was commenced in Jefferson County, Alabama, Homer L. Watson was, on that date, the Administrator of Mary Fejeran's estate with active, open letters of administration from this Court in full effect.
"2. To the extent that some other court might find the clarification stated in paragraph 1, above, insufficient in some way, this Court grants additional, further, or alternative relief under Rule 60(a) of the Alabama Rules of Civil Procedure.... Even though the order of March 24, 2014, said only that the Administrator was discharged from 'liabilities,' to the extent that some other court might read the ... order to be an ultimate closing of the Estate and a full termination of the letters of administration, this Court declares such language to be a clerical mistake. To make the order of March 24, 2014, speak the truth of what was intended, paragraphs 1 and 3 of the order are hereby amended to state (amending language underscored):
" '1. That said Petition for Final Settlement, seeking a discharge from liabilities for the administration of estate debts and property, be and is hereby confirmed; and
" '....
" '3. The Petitioner, the Administrator and his surety be discharged from all further estate-administration liabilities, but that the letters of administration remain in force....' "

On August 15, 2017, Watson filed a motion in opposition to the defendants' motion for a summary judgment, arguing that the March 24, 2014, order did not terminate his letters of administration. In support of his motion, Watson attached the March 23, 2017, order purporting to clarify and/or to correct the March 24, 2014, order and, more specifically, stating that Watson's letters of administration were still in effect on November 7, 2014, when he filed the wrongful-death action.

On September 5, 2017, after reviewing the evidence, the circuit court concluded that the March 24, 2014, order of final settlement was a final judgment, that the order was unambiguous, and that the order discharged and released Watson as personal representative of Fejeran's estate for all purposes. Accordingly, the circuit court entered a summary judgment in favor of the defendants, concluding that, because Watson had been discharged as personal representative of Fejeran's estate, he lacked the representative capacity to bring a wrongful-death action. This appeal followed.

"Because the facts are undisputed and we are presented with pure questions of law, our standard of review is de novo." George v. Sims, 888 So.2d 1224, 1226 (Ala. 2004). Alabama's wrongful-death statute, Ala. Code 1975, § 6-5-410, provides, in pertinent part, that "[a] personal representative may commence an action ... for the wrongful act, omission, or negligence of any person, persons, or corporation ... whereby the death of his testator or intestate was caused." In Alabama, wrongful death is purely statutory, and the wrongful-death statute grants only a legally appointed personal representative "the right to bring a wrongful-death action for the benefit of, and on behalf of, the decedent's heirs at law based on the death of the decedent by a wrongful act." Alvarado v. Estate of Kidd, 205 So.3d 1188, 1193 (Ala. 2016) (Bolin, J., concurring specially). Watson does not dispute that a legally appointed personal representative who has been discharged and released as the personal representative of a decedent's estate no longer has the capacity to bring a wrongful-death action. See Northstar Anesthesia of Alabama, LLC v. Noble, 215 So.3d 1044 (Ala. 2016) (plurality opinion)(holding that personal representative of decedent's estate who had been discharged and released as the personal representative lacked the representative capacity to commence a wrongful-death action); see also Ex parte Hubbard Props., Inc., 205 So.3d 1211 (Ala. 2016) (holding that a wrongful-death action brought by a person who was not a personal representative was a nullity). Rather, Watson argues that the probate court's March 23, 2017, order establishes that he was never discharged in his capacity as personal representative of Fejeran's estate and that he was serving in that capacity at the time he commenced the wrongful-death action. However, as the circuit court concluded, the March 24, 2014, order-"Decree of Final Settlement"-is clearly a final judgment. The order states that Watson and his surety are "discharged from all further liabilities." (Emphasis added.) Section 12-13-3, Ala. Code 1975, states that a judgment entered by the probate court "may be set aside or amended and the case reopened within 30 days after the rendition thereof by the judge of the court in which the said decree was rendered." Accordingly, the probate court's March 23, 2017, order purporting to clarify its March 24, 2014, final judgment is void, and the March 24, 2014, order is the operative final judgment of the probate court. See Lett v. Weaver, 79 So.3d 625 (Ala. Civ. App. 2010) (holding that, because more than 30 days had passed since the probate court entered its final-settlement order, the probate court had no jurisdiction to enter an amended final-settlement order and, thus, the initial final-settlement order was the operative judgment). Moreover, Rule 60(a), Ala. R. Civ. P., which applies to only the correction of clerical errors in judgments, did not authorize the probate court to substantively enlarge or modify the final-settlement order to say something other than what was originally pronounced. In Deramus Hearing Aid Center, Inc. v. American Hearing Aid Associates, Inc., 950 So.2d 292, 293-94 (Ala. 2006), this Court explained:

" Rule 60(a), Ala. R. Civ. P., provides that a trial court may correct a clerical mistake in a judgment at any time on its own initiative. The Committee Comments on 1973 Adoption of Rule 60(a), Ala. R. Civ. P., citing West Virginia Oil & Gas Co. v. George E. Breece Lumber Co., 213 F.2d 702 (5th Cir. 1954), state that a ' Rule 60(a) motion can only be used to make the judgment or record speak the truth and cannot be used to make it say something other than what was originally pronounced.' Black's Law Dictionary 582 (8th ed. 2004), defines 'clerical error' as '[a]n error resulting from a minor mistake or inadvertence, esp. in writing or copying something on the record, and not from judicial reasoning or determination.' (Emphasis added.)"

Based on the foregoing, we conclude that Watson, having been legally discharged as personal representative of Fejeran's estate, lacked the representative capacity to bring the wrongful-death action, and the action is therefore a nullity. Accordingly, the summary judgment in favor of the defendants is affirmed.

AFFIRMED.

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

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

Wise and Bryan, JJ., dissent.

SHAW, Justice (concurring in part and concurring in the result).

I agree with the main opinion that the probate court had no authority to amend its initial final-settlement order; that the appellant, Homer L. Watson, was not the personal representative of the deceased, Mary Fejeran, at the time the complaint in the underlying wrongful-death action was filed; and that the filing of such complaint, therefore, was a nullity. See Northstar Anesthesia of Alabama, LLC v. Noble, 215 So.3d 1044 (Ala. 2016) (plurality opinion); see also Ex parte Hubbard Props., Inc., 205 So.3d 1211 (Ala. 2016) (holding that a wrongful-death action commenced by a person who was not the personal representative was a nullity), and Downtown Nursing Home, Inc. v. Pool, 375 So.2d 465, 466 (Ala. 1979) (holding that because the person who commenced the wrongful-death action "did not qualify under § 6-5-410 as a personal representative this suit was a nullity"). However, as I have previously written, I do not believe that the filing of a wrongful-death action under Ala. Code 1975, § 6-5-410, by one who is not a "personal representative" presents an issue of lack of "capacity." See Northstar, 215 So.3d at 1052-54 (Shaw, J., concurring in the result).

      The defendants assert that the March 23, 2017, order is not recorded, and the only copy of the order in the appellate record is attached to Watson's opposition to their summary-judgment motion.


source: Caselaw Access Project

author: MAIN, Justice.

license: Public Domain

text:
    Christina BECK v. Jason BECK, as father and next friend of Eli Cameron Beck, a deceased minor
    1170288
    Supreme Court of Alabama.
    April 13, 2018
    Michael C. Lambert, Athens, for appellant.
    Submitted on appellant's brief only.
   MAIN, Justice.

Christina Beck ("the mother") appeals from a default judgment entered against her and in favor of Jason Beck, as father and next friend of Eli Cameron Beck, a deceased minor ("the father"). The mother contends, in part, that the default judgment was premature in that it was, she says, entered before her time to answer the complaint had expired. The father concedes that the default judgment was premature and stipulates that the default judgment should be set aside and the case remanded for further proceedings.

Based on the record before us and the stipulation of the parties, the default judgment is due to be set aside. See Walker v. First Nat'l Bank of Fairfield, 219 Ala. 444, 445, 122 So. 682, 682 (1929) ("If a judgment by default is prematurely rendered as shown by the record, it must be reversed on appeal."). Accordingly, the judgment of the Limestone Circuit Court is reversed and the case remanded for further proceedings consistent with this opinion. We pretermit discussion of all other issues raised on appeal.

REVERSED AND REMANDED.

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

      The mother filed a motion to set aside the default judgment; that motion was denied by operation of law pursuant to Rule 59.1, Ala. R. Civ. P.


author: BOLIN, Justice.

text:
    EX PARTE INTERNATIONAL PAPER COMPANY et al.
    (In re: Caterpillar Financial Services Corp. v. JRD Contracting, Inc., et al.)
    1170458
    Supreme Court of Alabama.
    April 27, 2018
    J. Gorman Houston, Jr., John M. Johnson, and Bridget E. Harris of Lightfoot, Franklin & White, L.L.C., Birmingham; and William J. Gamble and Woodruff R. Jones of Gamble, Gamble, Calame & Jones, LLC, Selma, for petitioners.
    Joseph C. McCorquodale III of McCorquodale Law Firm, Jackson; and Frank Leslie Lambert of The Lambert Law Office, Camden, for respondents.
   BOLIN, Justice.

International Paper Company and three employees (Janet Pridgeon, Joni Harris, and Shawn Blenis) seek a writ of mandamus directing the Wilcox Circuit Court to rule upon a pending motion to dismiss a case against them for improper venue, based on an outbound forum-selection clause in a waste-services agreement between International Paper and JRD Contracting & Land Clearing, Inc. ("JRD C & L"). We issue the writ.

Facts and Procedural History

On September 23, 2016, Caterpillar Financial Services Corp. sued JRD Contracting, Inc., and John R. Dailey, Jr., in the Wilcox Circuit Court alleging breach of various loan contracts, detinue, and breach of guaranty agreements. JRD Contracting had purchased Caterpillar brand construction and hauling equipment, financed through Caterpillar Financial Services, and Dailey had guaranteed the loan contracts. JRD Contracting is a an Alabama corporation with its principal place of business in Wilcox County. Dailey resides in Wilcox County.

On May 22, 2017, JRD Contracting and Dailey filed a third-party complaint against International Paper and three employees (hereinafter collectively referred to as "IPC") and fictitiously named defendants. International Paper is a corporation with its principal place of business in Tennessee.

JRD C & L had entered into a waste-services agreement with IPC pursuant to which JRD C & L was to dispose of material produced by International Paper's mill in Wilcox County. In their third-party complaint, JRD Contracting and Dailey alleged that if they were liable to Caterpillar Financial Services, it was because of the actions of IPC. They sought recovery from IPC on the theories of breach of contract, promissory estoppel, fraud, work and labor done, and indemnity and also sought a declaratory judgment. Along with the complaint, JRD Contracting and Dailey served IPC with interrogatories and requests for production.

On May 25, 2017, JRD Contracting and Dailey filed a motion to add JRD C & L as a defendant "needed for just adjudication of this matter." The circuit court granted the motion. On June 1, 2017, JRD Contracting, Dailey, and JRD C & L (hereinafter collectively referred to as "JRD") filed an amended complaint to add JRD C & L as a defendant/third-party plaintiff.

On June 26, 2017, IPC filed a motion to dismiss the third-party complaint without prejudice, pursuant to Rule 12(b)(3), Ala. R. Civ. P. IPC argued that the waste-services agreement between IPC and JRD C & L contained an outbound forum-selection clause, providing that the "courts of Tennessee shall have and [sic] exclusive jurisdiction over any disputes arising out of or relating to this Agreement." On June 30, 2017, IPC filed a motion to stay further proceedings pending a ruling on the motion to dismiss. IPC argued that requiring it to litigate the case before a ruling was entered on the motion to dismiss would "expose the parties to litigation costs and expenses that would be unnecessary if the Motion to Dismiss is granted."

On November 20, 2017, the circuit court issued a scheduling order setting a discovery deadline of February 28, 2018; a deadline for filing summary-judgment motions; and the trial for May 21, 2018. On January 9, 2018, IPC and Caterpillar filed a joint motion to continue the trial date pending a ruling on IPC's motion to dismiss. They argued that if the circuit court denied the motion, then additional discovery would be needed. JRD responded, arguing that no further discovery was needed and that all the parties had briefed the venue issue, which it says established Wilcox County as the proper venue. JRD also filed a motion for a summary judgment as to its claims against IPC.

On February 3, 2018, the circuit court held a hearing on the joint motion to continue. The circuit court entered an order stating:

"This matter came before the Court on a motion to continue the trial set for May 21, 2018, and having considered the same it is ordered, adjudged, and decreed said motion is denied. Further, it is ordered the court will continue to take the Motion to Dismiss under advisement."

That same day, the circuit court set a hearing for March 23, 2018, on JRD's motion for a summary judgment.

On February 20, 2018, IPC filed this petition for a writ of mandamus, along with a motion to stay all proceedings in the circuit court. On March 6, 2018, this Court ordered answer and briefs and granted the motion to stay the proceedings below.

Discussion

IPC asks this Court to direct the circuit court to rule on its motion to dismiss without prejudice based on the outbound forum-selection clause in the waste-services agreement. "An outbound forum-selection clause-a clause by which parties specifically agree to trial outside the State of Alabama in the event of a dispute-implicates the venue of a court rather than its jurisdiction." Ex parte Rymer, 860 So.2d 339, 341 (Ala. 2003).

IPC is not asking this Court to issue a ruling on venue. Instead, IPC seeks a writ compelling the circuit court to rule on its pending motion to dismiss for improper venue. In Ex parte Ford Motor Credit Co., 607 So.2d 169 (Ala. 1992), we addressed whether mandamus review was available to direct a trial court to rule on a pending motion. In Ford Motor Credit, the plaintiff held security interests in a number of trucks purchased by the defendants. The plaintiff filed a motion for a writ of seizure, pursuant to Rule 64, Ala. R. Civ. P. The materials before the Court indicated that the plaintiff had complied with the requirements of Rule 64 but that the trial judge, in an attempt to encourage a settlement of the case, repeatedly refused to rule on the motion even though he had been informed that the parties could not reach a settlement. Rule 64 provides that if the court fails to make a preliminary finding for the plaintiff, then the court should set a hearing at the earliest practical time. This Court held that, under the facts of that case, the trial judge had exceeded his discretion in failing to rule on the motion and the plaintiff was entitled to a writ of mandamus directing the trial court to rule on the motion for a writ of seizure. We stated:

"Mandamus is a drastic and extraordinary writ, to be issued only where there is 1) a clear legal right in the petitioner to the order sought; 2) an imperative duty upon the respondent to perform, accompanied by a refusal to do so; 3) the lack of another adequate remedy; and 4) properly invoked jurisdiction of the court. While the writ will issue to compel the exercise of discretion by a circuit judge, it will not issue to compel the exercise of discretion in a particular manner. On the other hand, mandamus is an appropriate remedy when there is a clear showing that the trial judge abused his or her discretion by exercising it in an arbitrary and capricious manner. Ex parte Adams, 514 So.2d 845 (Ala. 1987).
" Rule 64 required the trial judge in this case to rule on Ford's motion 'at the earliest practical time.' Rule 64(b)(2)(C). As previously noted, Ford has complied with the requirements of Rule 64 and there appears to be no reasonable basis for the trial judge's continuing delay in ruling on the motion. The parties have made it clear that they cannot reach a settlement. Ford, which is obviously concerned that its collateral may be concealed, transferred, or otherwise disposed of or damaged, is clearly entitled to a ruling."

Ford Motor Credit, 607 So.2d at 170.

The Court of Civil Appeals has issued a writ of mandamus in a case in which the trial court refused to rule on the plaintiff's Rule 60(b), Ala. R. Civ. P., motion. In Ex parte Gamble, 709 So.2d 67 (Ala. Civ. App. 1998), the plaintiff filed an action seeking against her employer worker's compensation benefits and damages for wrongful termination. The employer filed a motion for a summary judgment, which the trial court granted. The plaintiff filed a motion for relief from the judgment pursuant to Rule 60(b), Ala. R. Civ. P. The materials before the Court of Civil Appeals reflected that the trial court was unwilling to address the merits of the Rule 60(b) motion. The Court of Civil Appeals issued the writ and directed the trial court to issue an order addressing the merits of the Rule 60(b) motion. Citing Ford Motor Credit, 607 So.2d at 170, the court stated that, in issuing the writ, "we expressly disavow any opinion concerning whether [the plaintiff's] motion should or should not be granted; '[w]hile the writ [of mandamus] will issue to compel the exercise of discretion by a circuit judge, it will not issue to compel the exercise of discretion in a particular manner.' " 709 So.2d at 70.

In Ex parte Monsanto Co., 794 So.2d 350 (Ala. 2001), this Court addressed a mandamus petition in cases involving over 2,700 toxic-tort claims against the manufacturer. The manufacturer filed a motion for a change of venue based on pretrial publicity and the alleged inability to have a fair trial in the county in which the action had been filed. The trial court refused to rule on the motion, deciding instead to postpone consideration of the motion until "an appropriate length of time prior to this case being called for trial." 794 So.2d at 353. In its petition for a writ of mandamus, the manufacturer asked this Court to direct the trial court to transfer the cases to another county. We stated:

"This Court has never issued a writ of mandamus directing a trial court to transfer a case where the trial court has not yet ruled on the motion for a change of venue. Generally, the writ of mandamus will not issue to compel a trial court to exercise its discretion in a particular manner. Ex parte Ford Motor Credit Co., 607 So.2d 169, 170 (1992).
"....
"However, we are concerned about the potential bias created by the numerous newspaper articles and the extensive television news coverage of this case, and about the possibility that Calhoun County citizens, while serving as jurors, could come to consider themselves to be in harm's way because of the alleged wrongdoing by Monsanto. While we do not find a sufficient basis for directing the trial court to grant the motion for a change of venue, we urge the trial judge to carefully consider Monsanto's motion and to do so in a timely manner, because the trial court has indicated that if the cases are transferred then a special judge should be appointed to hear them. We are certain that in ruling on the change-of-venue issue, the trial judge will carefully consider the materials Monsanto has presented to this Court (copies of the newspaper articles and videotapes of the television news coverage of these cases), as well as the information Monsanto has presented regarding the effect this publicity, and the evidence to be presented at trial, might have on jurors in Calhoun County. We are certain that the judge will carefully weigh the disadvantages to the plaintiffs of transferring these cases against the advantage to Monsanto of transferring them to a forum where, even if there is significant pretrial publicity, the jury venire will not be composed of potential victims of the alleged wrongful conduct.
"The trial judge has requested that if this Court orders a change of venue (and it does not), then it should also appoint a special judge to hear these cases. Monsanto also has requested that we appoint a special judge to handle these cases. We have declined to require the trial court to grant Monsanto's motion to change venue. Because a determination by the trial court as to the appropriate venue for these cases affects the issue whether a special judge will be appointed to try these cases, and because deferring a resolution of the venue issue until immediately before trial could put all parties to the expense of unnecessary preparation if the order deciding venue is then subject to a stay pending review by a petition for an extraordinary writ, we direct the trial court to dispose of the motion for a change of venue as the first order of business in regard to these cases. Should the trial judge order a change of venue, then we will, at that time, consider a request to appoint a special judge. If the trial court grants the change-of-venue motion, it may defer ruling on the jury-selection procedures and the trial format until a determination is made whether to appoint a special judge. The special judge, if appointed, should rule on jury-selection procedures and the trial format."

Ex parte Monsanto Co., 794 So.2d at 353-56 (emphasis added). Although the Monsanto Court did not order a change of venue as the manufacturer had requested, the Court did order the trial court to rule on the motion for a change of venue before dealing with any other issues in the cases.

" '[A] petition for a writ of mandamus is the proper vehicle for obtaining review of an order denying enforcement of an "outbound" forum-selection clause when it is presented in a motion to dismiss.' Ex parte D.M. White Constr. Co., 806 So.2d 370, 372 (Ala. 2001) ; see Ex parte CTB, Inc., 782 So.2d 188, 190 (Ala. 2000). '[A] writ of mandamus is an extraordinary remedy, which requires the petitioner to demonstrate a clear, legal right to the relief sought, or an abuse of discretion.' Ex parte Palm Harbor Homes, Inc., 798 So.2d 656, 660 (Ala. 2001). '[T]he review of a trial court's ruling on the question of enforcing a forum-selection clause is for an abuse of discretion.' Ex parte D.M. White Constr. Co., 806 So.2d at 372."

Ex parte Leasecomm Corp., 886 So.2d 58, 62 (Ala. 2003).

Based on Ford Motor Credit, Gamble, Monsanto, and Leasecomm, it is clear that IPC's request for this Court to issue a writ of mandamus compelling the circuit court to exercise its discretion by ruling on the motion to dismiss based on improper venue before proceeding further is appropriate under these circumstances.

In the present case, the circuit court left pending IPC's motion to dismiss asserting improper venue, but ordered that final discovery on the merits was to be completed by February 28, 2018, that all motions for a summary judgment were to be filed by March 26, 2018, and that the trial was to be held on May 21, 2018. IPC argues that venue is a threshold issue, citing Thompson v. Skipper Real Estate Co., 729 So.2d 287 (Ala. 1999) (noting, in discussion of issue whether defendant had substantially invoked the litigation process, that a defendant has a right to determine venue before asserting a demand for arbitration), and Ex parte Windom, 776 So.2d 799 (Ala. 2000) (holding that venue is a threshold matter that must be raised at the beginning of litigation and that a trial court should rule on a motion for a change of venue as expeditiously as possible). IPC also argues that the circuit court exceeded its discretion by denying IPC and Caterpillar's joint motion to continue the trial date, citing Thomas v. Kellett, 489 So.2d 554, 555 (Ala. 1986) (holding that a denial of a continuance will not be overturned where trial court has not exceeded its discretion). IPC argues that requiring it to participate in the litigation process while failing to rule on the motion to dismiss requires that it either waive the right to conduct discovery and to formulate an adequate defense or waive the right to enforce the outbound forum-selection clause, based on Ex parte Spencer, 111 So.3d 713 (Ala. 2012) (holding that a party may waive a forum-selection clause by substantially invoking the litigation process).

We note that an attempt to seek enforcement of an outbound forum-selection clause is properly presented in a motion to dismiss without prejudice, pursuant to Rule 12(b)(3), Ala. R. Civ. P., based on improper venue. Ex parte D.M. White Constr. Co., 806 So.2d 370, 372 (Ala. 2001).

In Professional Insurance Corp. v. Sutherland, 700 So.2d 347, 351 (Ala. 1997), this Court adopted the majority rule, by which an "outbound" forum-selection clause is upheld unless the party challenging the clause clearly establishes that it would be unfair or unreasonable under the circumstances to hold the parties to their bargain. 700 So.2d at 351. The party challenging the clause can meet its burden by clearly establishing either "(1) that enforcement of the forum selection clause would be unfair on the basis that the contract was affected by fraud, undue influence, or overweening bargaining power or (2) that enforcement would be unreasonable on the basis that the chosen ... forum would be seriously inconvenient for the trial of the action." 700 So.2d at 352. "Because '[i]t is a difficult burden to defeat a forum selection clause[,]' Smith v. Professional Claims, Inc., 19 F.Supp.2d 1276, 1282 (M.D. Ala. 1998), such clauses will usually be enforced." Ex parte CTB, Inc., 782 So.2d 188, 191 (Ala. 2000).

Here, the circuit court exceeded its discretion by failing to rule on, and instead "taking under advisement," the motion to dismiss the third-party complaint based on improper venue while allowing discovery on the merits to proceed and setting deadlines for summary-judgment motions and setting the trial date. Therefore, we issue the writ and direct the circuit court to issue an order addressing the merits of IPC's motion to dismiss based on improper venue. We express no opinion as to whether IPC's motion should or should not be granted; "[w]hile the writ [of mandamus] will issue to compel the exercise of discretion by a circuit judge, it will not issue to compel the exercise of discretion in a particular manner." Ford Motor Credit, 607 So.2d at 170.

PETITION GRANTED; WRIT ISSUED.

Stuart, C.J., and Parker, Shaw, Main, Wise, Bryan, Sellers, and Mendheim, JJ., concur.

      JRD's summary-judgment motion is not included in the exhibits filed in this Court by the parties.


author: MENDHEIM, Justice.

text:
    Tara LYND v. MARSHALL COUNTY PEDIATRICS, P.C.
    1160683
    Supreme Court of Alabama.
    April 27, 2018
    Gary P. Wolfe of Wolfe, Jones, Wolfe, Hancock, Daniel & South, LLC, Huntsville, for appellant.
    Marc James Ayers of Bradley Arant Boult Cummings LLP, Birmingham; and Jeffrey McLaughlin of McLaughlin & Edmondson, LLC, Guntersville, for appellee.
   MENDHEIM, Justice.

Tara Lynd, a physician ("Dr. Lynd"), appeals from a summary judgment entered by the Marshall Circuit Court in favor of Marshall County Pediatrics, P.C. ("MCP"), in her action seeking a judgment declaring the proper valuation of her shares in MCP. We reverse and remand.

I. Facts

In July 1978, John M. Packard, M.D. ("Dr. Packard"), filed articles of incorporation forming MCP, a medical practice specializing in pediatrics in Guntersville. At the same time, MCP adopted bylaws. Those bylaws reference a separate "stockholder agreement," but one was never executed. Over time, Dr. Packard hired other physicians to work with him in MCP. In 2005, Dr. Packard hired Dr. Lynd as a pediatrician to work for MCP.

On July 1, 2013, Dr. Packard retired from practice, and he sold MCP to four other physicians who were then working for MCP: Dr. David Chupp, Dr. Don Jones, Dr. Sarah Rhodes, and Dr. Lynd. On July 31, 2013, each of the four physicians executed separate agreements pursuant to which each physician purchased 25 percent of Dr. Packard's shares in MCP-each agreeing to pay him $25,000-for a total purchase price of $100,000. At the time of sale, each physician paid Dr. Packard $1,000, with the understanding that he or she would pay Dr. Packard the remaining amount due for his or her shares, with interest, over a period of several years.

At the time the four physicians acquired MCP from Dr. Packard, they accepted the bylaws without alteration. They did not execute a stockholder agreement. Dr. Rhodes stated in an affidavit that the physicians had "no intent or purpose to avoid" executing a stockholder agreement among themselves; she stated that they "simply never got it done."

At a meeting of the shareholders held on August 27, 2013, following Dr. Packard's retirement, each of the four physicians, including Dr. Lynd, was elected as a director of MCP. Dr. Lynd was also elected secretary of MCP.

On March 2, 2014, Dr. Lynd telephoned each of the other physicians to inform him or her that she would be leaving MCP to go to Oklahoma to care for her mother, whose health was declining. On April 3, 2014, Dr. Lynd provided written notice to the other physicians that she was leaving the practice effective June 30, 2014. However, following a meeting of the shareholders on May 7, 2014, Dr. Lynd determined that she could no longer work at MCP, and she issued a resignation letter and severed her employment with MCP on May 16, 2014. At a shareholder meeting specially called on December 29, 2014, the other three physicians officially voted to remove Dr. Lynd as a director and an officer of MCP. In an affidavit submitted in the trial court, Dr. Lynd stated that she was no longer licensed to practice medicine in Alabama.

Dr. Rhodes testified in her affidavit that, upon Dr. Lynd's severance from MCP, the other three physicians did not dispute that Dr. Lynd was owed her portion of the receivables/production bonuses generated by MCP. According to Dr. Rhodes, MCP paid Dr. Lynd $43,783.60 in receivables/production bonuses. Dr. Rhodes also stated that, as of the date Dr. Lynd severed her employment with MCP, Dr. Lynd had personally paid Dr. Packard $1,000 and that, through the practice, Dr. Lynd had paid an additional $11,261.40 toward the $25,000 purchase price for her shares of stock in MCP.

Dr. Lynd demanded, based on the bylaws, that MCP purchase her shares in the practice at "fair value." Article VI, § 4, of MCP's bylaws provides:

"If any shareholder of the corporation for any reason ceases to be duly licensed to practice medicine in the state of Alabama, accepts employment that, pursuant to law, places restrictions or limitations upon his continued rendering of professional services as a physician, or upon the death or adjudication of incompetency of a stockholder or upon the severance of a stockholder as an officer, agent, or employee of the corporation, or in the event any shareholder of the corporation, without first obtaining the written consent of all other shareholders of the corporation shall become a shareholder or an officer, director, agent or employee of another professional service corporation authorized to practice medicine in the State of Alabama, or if any shareholder makes an assignment for the benefit of creditors, or files a voluntary petition in bankruptcy or becomes the subject of an involuntary petition in bankruptcy, or attempts to sell, transfer, hypothecate, or pledge any shares of this corporation to any person or in any manner prohibited by law or by the By-Laws of the corporation or if any lien of any kind is imposed upon the shares of any shareholder and such lien is not removed within thirty days after its imposition, or upon the occurrence, with respect to a shareholder, of any other event hereafter provided for by amendment to the Certificates of Incorporation or these By-Laws, then and in any such event, the shares of this [c]orporation of such shareholder shall then and thereafter have no voting rights of any kind, and shall not be entitled to any dividend or rights to purchase shares of any kind which may be declared thereafter by the corporation and shall be forthwith transferred, sold, and purchased or redeemed pursuant to the agreement of the stockholders in [e]ffect at the time of such occurrence. The initial agreement of the stockholders is attached hereto and incorporated herein by reference[;] however, said agreement may from time to time be changed or amended by the stockholders without amendment of these By-Laws. The method provided in said agreement for the valuation of the shares of a deceased, retired or bankrupt stockholder shall be in lieu of the provisions of Title 10, Chapter 4, Section 228 of the Code of Alabama of 1975."

(Emphasis added.)

Dr. Lynd and the other three physicians disagreed as to the method of valuation for Dr. Lynd's shares in MCP. Dr. Lynd insisted that the valuation should be based on the "fair value" of the shares, pursuant to the method for valuing stock provided in § 10A-4-3.02, Ala. Code 1975. The relevant subsections of § 10A-4-3.02 provide:

"(a) Upon the death of a shareholder of a domestic professional corporation or if a shareholder of a domestic professional corporation becomes a disqualified person or if shares of a domestic professional corporation are transferred by operation of law or court decree to a disqualified person, the shares of the deceased shareholder or of the disqualified person may be transferred to a qualified person and, if not so transferred, shall be purchased or redeemed by the domestic professional corporation to the extent of funds which may be legally made available for the purchase.
"(b) If the price for the shares is not fixed by the governing documents of the domestic professional corporation or by private agreement, the domestic professional corporation, within six months after the death or 30 days after the disqualification or transfer, as the case may be, shall make a written offer to pay for the shares at a specified price deemed by the domestic professional corporation to be the fair value thereof as of the date of the death, disqualification or transfer...."

(Emphasis added.) Based on a valuation pursuant to § 10A-4-3.02, Dr. Lynd calculated her shares to be worth $230,000.

Conversely, the other three physicians insisted that the valuation should be based on the "book value" of the shares, pursuant to the method provided in former § 10-4-228, Ala. Code 1975 (repealed in 1980), referenced in the bylaws, which stated, in pertinent part:

"The articles of incorporation may provide for the purchase or redemption of the shares of any shareholder upon the death or disqualification of such shareholder, or the same may be provided in the bylaws or by private agreement. In the absence of a provision for the same in the articles of incorporation or the bylaws or by private agreement, the professional corporation shall purchase the shares of a deceased shareholder or a shareholder no longer qualified to own shares in such corporation within 90 days after the death of the shareholder or disqualification of the shareholder, as the case may be. The price for such shares shall be the book value as of the month immediately preceding the death or disqualification of the shareholder. Book value shall be determined from the books and records of the professional corporation in accordance with the regular method of accounting used by such corporation...."

(Emphasis added.) Based on a valuation pursuant to § 10-4-228, the other three physicians calculated Dr. Lynd's shares to be worth $6,275.

On April 21, 2015, Dr. Lynd sued MCP in the Marshall Circuit Court, asserting a claim of breach of contract and seeking specific performance of MCP's obligation to purchase her stock as well as a judgment declaring that she was entitled to the "fair value" of those shares from MCP. MCP filed an answer to the complaint.

On September 20, 2016, Dr. Lynd filed a motion for a summary judgment along with a brief and exhibits in support of the motion. On October 3, 2016, MCP filed a motion for a summary judgment along with a brief and exhibits in support of its motion. Following a hearing on the motions, the parties submitted supplemental briefs.

On December 27, 2016, the trial court entered an order granting MCP's summary-judgment motion and denying Dr. Lynd's summary-judgment motion. In pertinent part, the order stated that "[t]he value of stock rights of Dr. Lynd is set at book value on [the] date she left the practice."

On January 9, 2017, Dr. Lynd filed a motion to alter, amend, or vacate the trial court's December 27, 2016, order in favor of MCP. MCP filed a reply to the motion on March 28, 2017. Following a hearing on the motion, the trial court entered an order on March 31, 2017, denying Dr. Lynd's motion. The order stated, in pertinent part:

"The Court's Order of December 27, 2016, is hereby affirmed, denying [Dr.
Lynd's] Motion for Summary Judgment and all relief requested by [Dr. Lynd] and [MCP's] Motion for Summary Judgment is granted in full, thereby confirming the finding that the value of [Dr. Lynd's] stock is 25% of book value, $6,275.00. All other relief not granted herein is denied."

Dr. Lynd appeals.

II. Standard of Review

" 'This Court reviews a summary judgment de novo. Turner v. Westhampton Court, L.L.C., 903 So.2d 82, 87 (Ala. 2004). We seek to determine whether the movant has made a prima facie showing that there exists no genuine issue of material fact and has demonstrated that the movant is entitled to a judgment as a matter of law. Turner, supra. In reviewing a summary judgment, this Court reviews the evidence in the light most favorable to the nonmovant. Turner, supra. Once the movant makes a prima facie showing that he is entitled to a summary judgment, the burden shifts to the nonmovant to produce "substantial evidence" creating a genuine issue of material fact. Ala. Code 1975, § 12-21-12 ; Bass v. SouthTrust Bank of Baldwin County, 538 So.2d 794, 797-98 (Ala. 1989). "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 Fla., 547 So.2d 870, 871 (Ala. 1989).'
" Muller v. Seeds, 919 So.2d 1174, 1176-77 (Ala. 2005). As is true with regard to a trial court's rulings on questions of law in the context of a bench trial, we review de novo questions of law arising in the context of a summary judgment."

Van Hoof v. Van Hoof, 997 So.2d 278, 286 (Ala. 2007).

III. Analysis

Dr. Lynd contends that the trial court erred in determining that book value would be used to value her stock in MCP because, she argues, neither the bylaws, the law as established by the legislature, nor equity dictates using book value. As Dr. Lynd notes, the trial court apparently concluded that the bylaws required following the valuation standard set out in § 10-4-228, even though the trial court's orders did not expressly state that it was following that statute. MCP agrees that the trial court applied § 10-4-228 because it was referenced in the bylaws, specifically in Art. VI, § 4. The parties extensively debate the meaning of the reference to § 10-4-228 in Art. VI, § 4.

In pertinent part, Art. VI, § 4, of the bylaws provides:

"[U]pon the severance of a stockholder as an officer, agent, or employee of the corporation, ... the shares of this [c]orporation of such shareholder shall then and thereafter have no voting rights of any kind, and shall not be entitled to any dividend or rights to purchase shares of any kind which may be declared thereafter by the corporation and shall be forthwith transferred, sold, and purchased or redeemed pursuant to the agreement of the stockholders in [e]ffect at the time of such occurrence. The initial agreement of the stockholders is attached hereto and incorporated herein by reference[;] however, said agreement may from time to time be changed or amended by the stockholders without amendment of these By-Laws. The method provided in said agreement for the valuation of the shares of a deceased, retired or bankrupt stockholder shall be in lieu of the provisions of Title 10, Chapter 4, Section 228 of the Code of Alabama of 1975."

(Emphasis added.)

For purposes of this case, two issues are presented by the language of Art. VI, § 4: (1) whether a shareholder is entitled to redemption of his or her shares in MCP and, if so, (2) what valuation method is to be used to redeem the shares of a shareholder entitled to such redemption.

As to the first issue, Art. VI, § 4, states that the shares of a shareholder severed from the corporation "shall be forthwith ... redeemed pursuant to the agreement of the stockholders in [e]ffect at the time of such occurrence." (Emphasis added.) Because no stockholder agreement exists, it would appear, based on the plain language of Art. VI, § 4, that Dr. Lynd is not entitled to the redemption of her shares under the bylaws. However, the trial court determined that Dr. Lynd was entitled to the redemption of her shares in MCP, rejecting MCP's argument to the contrary in its motion for a summary judgment. MCP states in its brief that "the circuit court correctly found that Dr. Lynd is entitled to 25% of the net book value, or $6,275.00." MCP's brief, p. 25. Thus, MCP concedes that Dr. Lynd is entitled to some compensation for her shares, even though the bylaws appear to provide otherwise. Consequently, the potential implication of the above-quoted sentence from Art. VI, § 4, of the bylaws is not before us in this appeal.

Because MCP does not contend that Dr. Lynd is owed nothing, we must agree for purposes of this appeal with Dr. Lynd's contention that under Art. VI, § 4, she is entitled to redemption of her shares in MCP. Accordingly, the second issue concerning what valuation method, under the bylaws, will be used to redeem Dr. Lynd's shares in MCP must be addressed.

MCP contends, and the trial court apparently agreed, that Art. VI, § 4, of the bylaws requires using the valuation method described in § 10-4-228, i.e., book value. This is so, MCP says, because the bylaws constitute a contract and "the Bylaws clearly indicated [the] understanding and expectation [of the members of MCP] that any stock rights would be valued as provided in Section 228 ...." MCP's brief, p. 16. In contrast, Dr. Lynd argues that the plain language of Art. VI, § 4, shows that the original directors expressly rejected using § 10-4-228 as a method for valuing redeemed stock. See Dr. Lynd's brief, p. 25.

This Court has stated that " '[i]t is well established that the constitution, bylaws, rules and regulations of a voluntary association constitute a contract between the association's members, which is binding upon each member so long as the bylaws, etc., remain in effect.' " Turner v. W. Ridge Apartments, Inc., 893 So.2d 332, 335 (Ala. 2004) (quoting Wells v. Mobile Cty. Bd. of Realtors, Inc., 387 So.2d 140, 142 (Ala. 1980) ). We have further explained that "[c]orporate documents such as by-laws and membership certificates are equivalent to contracts among the members of the organization.... Accordingly, normal rules of construction for contracts apply." Black v. Glass, 438 So.2d 1359, 1367 (Ala. 1983).

"When interpreting a contract, this Court must first look to the plain language of the contract and determine whether that language is ambiguous. '[A] court should give the terms of the agreement their clear and plain meaning and should presume that the parties intended what the terms of the agreement clearly state.' Ex parte Dan Tucker Auto Sales, Inc., 718 So.2d 33, 36 (Ala. 1998)
(citing Pacific Enters. Oil Co. (USA) v. Howell Petroleum Corp., 614 So.2d 409 (Ala. 1993) ). 'A court may not make a new contract for the parties or rewrite their contract under the guise of construing it.' Ex parte Dan Tucker Auto Sales, 718 So.2d at 35-36 (citing Estes v. Monk, 464 So.2d 103 (Ala. Civ. App. 1985) )."

Turner, 893 So.2d at 335.

The relevant portion of Art. VI, § 4, provides: "The method provided in [the] agreement [of the stockholders] for the valuation of the shares of a deceased, retired or bankrupt stockholder shall be in lieu of the provisions of Title 10, Chapter 4, Section 228 of the Code of Alabama of 1975." The difficulty presented here is that there is no stockholder agreement.

MCP contends that because the stockholders failed to execute an agreement, Art. VI, § 4, intends for § 10-4-228 to apply for the valuation of Dr. Lynd's shares. MCP argues that the question that must be answered is: What would the stockholders' expectation concerning a valuation method have been in the event no stockholder agreement was ever executed? It answers:

"Clearly, the parties' expectation would be that 'book value' would be used, and, as there is no prohibition on the use of 'book value' (although one could have easily been included), the Bylaws reflect a recognition of, comfort with, and assent to, the 'book value' methodology as the contingency in the event that, for whatever reason, the parties do not draft a separate agreement."

MCP's brief, p. 19. There are, however, at least two readily apparent problems with this argument.

First, the only intention clearly conveyed in the language of Art. VI, § 4, of the bylaws is that a stockholder agreement would be executed and that that agreement would dictate the valuation method. Before the final sentence concerning the method of valuation for the redemption of stock, § 4 states that the shares of a shareholder severed from the corporation

"shall be forthwith ... redeemed pursuant to the agreement of the stockholders in [e]ffect at the time of such occurrence. The initial agreement of the stockholders is attached hereto and incorporated herein by reference [;] however, said agreement may from time to time be changed or amended by the stockholders without amendment of these By-Laws."

(Emphasis added.) Article VI, § 4, was written and adopted with the intention that the stockholders would execute an agreement addressing the details of the transfer, purchase, or redemption of the stock of a severed stockholder.

Moreover, there is no expressed intention of what should be done in the event no stockholder agreement is executed. Black's Law Dictionary defines "in lieu of" to mean "[i]nstead of or in place of; in exchange or return for." Black's Law Dictionary 907 (10th ed. 2014). See also National Sewing-Mach. Co. v. Willcox & Gibbs Sewing-Mach. Co., 74 F. 557, 560 (3d Cir. 1896) (" 'In lieu of' means 'instead' of, 'in place of,' 'in substitution for.' "). Thus, the plain meaning of the final sentence of Art. VI, § 4, is that the method for valuation of shares for the purpose of redemption will be provided in the stockholders' agreement instead of the method provided in § 10-4-228. In other words, the bylaws expressly reject the valuation method provided in § 10-4-228 in favor of a method that would be provided in the stockholder agreement. MCP's argument that the reference to § 10-4-228 constitutes a perpetual fallback provision in the absence of a stockholder agreement divines an intention from the bylaws that simply is not present in the language of Art. VI, § 4. The clear intent of the parties executing the bylaws was to avoid a "book value" valuation in favor of one agreed to by the parties.

We acknowledge that a contract presumes that the applicable law is the law that is in effect at the time the contract is executed. See, e.g., Macon Cty. Greyhound Park, Inc. v. Knowles, 39 So.3d 100, 108 (Ala. 2009) (observing that " ' "every contract is made with reference to existing law and every law affecting the contract is read into and becomes a part of the contract when made" ' " (quoting Barber Pure Milk Co. v. Alabama State Milk Control Bd., 275 Ala. 489, 494, 156 So.2d 351, 355 (1963), quoting in turn Bush v. Greer, 235 Ala. 56, 58, 177 So. 341 (1937) ) ); Baldwin Cty. Elec. Membership Corp. v. Lee, 804 So.2d 1087, 1090 (Ala. 2001) (noting that "[p]rovisions governing corporate operations include not only a corporation's articles of incorporation and bylaws, but also relevant sections of the statutory scheme under which the corporation exists"). Thus, when the bylaws were adopted in 1978, § 10-4-228 was the default provision for valuing shares of a deceased or disqualified shareholder of a public corporation for purchase or redemption. The method of valuation provided in § 10-4-228 applied as a matter of law, not contract; to avoid the application of the default provision, it was necessary only to state that the stockholders desired a different method of valuation from that provided in the law, and that was clearly the intention in MCP's bylaws. MCP's bylaws sought to reject the default provision for the valuation of stock that existed in 1978 in favor of a method that would be agreed upon by the stockholders. Given the plain meaning of the term "in lieu of," the final sentence of Article VI, § 4, cannot plausibly be read to embed § 10-4-228 in perpetuity as a fallback valuation method in the event no stockholder agreement was executed.

Moreover, as Dr. Lynd notes, in 1984 the legislature replaced § 10-4-228 with § 10-4-389, Ala. Code 1975, which provided, in pertinent part:

"(a) Upon the death of a shareholder of a domestic professional corporation or if a shareholder of a domestic professional corporation becomes a disqualified person or if shares of a domestic professional corporation are transferred by operation of law or court decree to a disqualified person, the shares of such deceased shareholder or of such disqualified person may be transferred to a qualified person and, if not so transferred, shall be purchased or redeemed by the domestic professional corporation to the extent of funds which may be legally made available for such purchase.
"(b) If the price for such shares is not fixed by the articles of incorporation or bylaws of the domestic professional corporation or by private agreement, the domestic professional corporation, within six months after such death or 30 days after such disqualification or transfer, as the case may be, shall make a written offer to pay for such shares at a specified price deemed by such domestic professional corporation to be the fair value thereof as of the date of such death, disqualification or transfer...."

(Emphasis added.) Thus, as of 1984, fair value became the default method of valuation for the redemption of shares in a professional corporation under the law addressing that issue.

In 2009, the legislature amended § 10-4-389 and renumbered it as § 10A-4-3.02, Ala. Code 1975, which provides, in pertinent part:

"(a) Upon the death of a shareholder of a domestic professional corporation or if a shareholder of a domestic professional corporation becomes a disqualified person or if shares of a domestic professional corporation are transferred by operation of law or court decree to a disqualified person, the shares of the deceased shareholder or of the disqualified person may be transferred to a qualified person and, if not so transferred, shall be purchased or redeemed by the domestic professional corporation to the extent of funds which may be legally made available for the purchase.
"(b) If the price for the shares is not fixed by the governing documents of the domestic professional corporation or by private agreement, the domestic professional corporation, within six months after the death or 30 days after the disqualification or transfer, as the case may be, shall make a written offer to pay for the shares at a specified price deemed by the domestic professional corporation to be the fair value thereof as of the date of the death, disqualification or transfer...."

(Emphasis added.) Consequently, when it amended § 10-4-389, the legislature retained fair value as the default method of valuation for the redemption of shares in a professional corporation. Additionally, § 10A-4-5.08(a), Ala. Code 1975, provides, in part, that "[t]he provisions of this chapter shall apply to all existing corporations organized under the statute formerly codified as Article 11 of Chapter 4, Title 10 and repealed by Acts 1983, No. 83-514, effective January 1, 1984 ...." MCP was such a corporation, i.e., one organized under the now repealed Title 10; there is no question that § 10A-4-3.02 is the default provision for valuation of the redemption of its stock.

MCP's interpretation of the bylaws would require us to ignore the changes in the law described in the foregoing two paragraphs. Essentially, MCP contends that the final sentence of Art. VI, § 4, of the bylaws states: "The method provided in [the stockholder] agreement for the valuation of the shares of a deceased, retired or bankrupt stockholder will govern, but if no stockholder agreement is executed, the method of valuation provided in § 10-4-228 will govern, even if there has been a change in the law." The sentence plainly does not say this. It states: "The method provided in [the stockholder] agreement for the valuation of the shares of a deceased, retired or bankrupt stockholder shall be in lieu of the provisions of Title 10, Chapter 4, Section 228 of the Code of Alabama of 1975." (Emphasis added.) The phrase "in lieu of the provisions of Title 10, Chapter 4, Section 228 of the Code of Alabama of 1975" plainly describes and rejects the current relevant statutory provision at the time the bylaws were executed, a provision that subsequently was replaced with a provision codifying a fair-value methodology 30 years before the four physicians acquired their interests in MCP.

A second problem with MCP's argument is that, even if it is assumed that the final sentence of Art. VI, § 4, plausibly could be read to mean that, if no stockholder agreement is executed, the method of valuation provided in § 10-4-228 applies in perpetuity, by its plain language that sentence does not apply to Dr. Lynd's circumstances. The sentence states that it applies to "the shares of a deceased, retired or bankrupt stockholder." Dr. Lynd was not severed from MCP as a result of death, retirement, or bankruptcy. Therefore, the events that would trigger the application of the method of valuation provided in § 10-4-228 under MCP's reading of the final sentence of Art. VI, § 4, do not apply to Dr. Lynd. In other words, even under MCP's interpretation, the final sentence of Art. VI, § 4, would provide for use of the book-value method only when there is no stockholder agreement and the stock is being redeemed for a deceased, retired, or bankrupt stockholder; Dr. Lynd is not such a stockholder.

Based on the foregoing, we conclude that Art. VI, § 4, of the bylaws does not require the application of § 10-4-228 and its preference for book value as to the redemption of Dr. Lynd's stock. Therefore, Dr. Lynd has demonstrated that the trial court's judgment is erroneous in this regard.

Dr. Lynd further contends that the trial court erred by not using the fair-value method for valuation of her stock in MCP. In advancing that argument, Dr. Lynd is essentially contending that the trial court should have granted her motion for a summary judgment.

"Ordinarily, a party may not appeal from the denial of a summary-judgment motion. Parsons Steel, Inc. v. Beasley, 522 So.2d 253, 258 (Ala. 1988) ('An order denying summary judgment is interlocutory and nonappealable.'). Where cross-motions for a summary judgment are filed in the trial court, the party whose motion was not granted is entitled to have that motion reviewed on an appeal from the grant of the opponent's motion ...."

Mountain Lakes Dist., N. Alabama Annual Conference, United Methodist Church, Inc. v. Oak Grove Methodist Church, 126 So.3d 172, 180 (Ala. Civ. App. 2013) (citing Lloyd Noland Found. v. City of Fairfield Healthcare Auth., 837 So.2d 253, 263 (Ala. 2002) ). This means that Dr. Lynd had to demonstrate that, as a matter of law, she was entitled to fair value for her shares of stock in MCP.

Dr. Lynd first contends that § 10A-4-3.02, as the current default provision for valuation for the redemption of shares in a professional corporation, requires the use of fair value as the method for valuing her shares in MCP. As MCP observes, however, in order for § 10A-4-3.02 to apply, Dr. Lynd must demonstrate that she is a "disqualified person" under the statute. This is so because § 10A-4-3.02(a) states, in relevant part: "Upon the death of a shareholder of a domestic professional corporation or if a shareholder of a domestic professional corporation becomes a disqualified person..., the shares ... of the disqualified person ... shall be purchased or redeemed by the domestic professional corporation ...." (Emphasis added.) Thus, § 10A-4-3.02 applies only to instances in which a stockholder dies or "becomes a disqualified person."

Dr. Lynd contends that she is "disqualified" because she is no longer eligible to hold stock in MCP according to its articles of incorporation. Under the articles of incorporation, Dr. Lynd is not qualified to own shares in MCP because she is no longer an employee of MCP and she is no longer licensed to practice medicine in Alabama. But "disqualification" for purposes of § 10A-4-3.02 has a different meaning than the one expressed in MCP's corporate organizational documents.

Section 10A-4-1.03(1), Ala. Code 1975, defines a "disqualified person" as "[a]ny person who is not a qualified person." Section 10A-4-1.03(6) a., Ala. Code 1975, defines a "qualified person" "[w]ith respect to any domestic professional corporation" as "[a]n individual who is authorized by law of Alabama or of any qualified state to render a professional service permitted by the certificate of formation of the professional corporation." Thus, under § 10A-4-3.02(a), disqualification is based on a person's professional licensing status.

As we have already noted, it is undisputed that Dr. Lynd is no longer licensed to practice medicine in Alabama. Dr. Lynd has not demonstrated, however, that she is not licensed to practice medicine in any "qualified state" under § 10A-4-1.03(7), Ala. Code 1975. For Dr. Lynd to be entitled to a summary judgment on this basis, she had to demonstrate that she is a "disqualified person" in all respects under § 10A-4-3.02(a), and she failed to meet this burden.

Dr. Lynd also contends that, even if she is not a "disqualified person" under § 10A-4-3.02, the fair-value method is "an equitable approach to the valuation of shares of stock." Dr. Lynd's brief, p. 45. In support of this assertion, Dr. Lynd cites some divorce cases and cases involving dissenting shareholders in which Alabama courts have concluded that fair value is an equitable method of determining the amount shareholders are entitled to receive for their stock. See, e.g., Grelier v. Grelier, 44 So.3d 1092, 1098 (Ala. Civ. App. 2009) ; Offenbecher v. Baron Servs., Inc., 874 So.2d 532, 536 (Ala. Civ. App. 2002).

Dr. Lynd is correct that there is support for using the fair-value method in the context of equity jurisprudence, but she fails to provide a persuasive argument or to cite any authority for why invoking equity jurisdiction in the context of this case is required as a matter of law. Dr. Lynd argues that "the court is compelled to invoke its equitable powers to arrive at a fair method to value the stock of Dr. Lynd" because "of the simple fact that the Bylaws of the corporation unequivocally require purchase of Dr. Lynd's stock by MCP, but simply fail[ ] to provide a method of valuation." Dr. Lynd's brief, p. 40.

Dr. Lynd's argument does not accurately reflect the state of affairs in this case. The bylaws did announce the manner in which a valuation method would be chosen: a stockholder agreement would provide the method of valuation. But Dr. Lynd and the other stockholders failed to execute such a stockholder agreement. Consequently, Dr. Lynd is asking this Court to invoke equity jurisdiction to supply an agreement the parties never reached, even though the bylaws clearly intended that the parties would reach an agreement. "Courts cannot make contracts for parties, but must give such contracts as are made a reasonable construction and enforce them accordingly." Charles H. McCauley Assocs., Inc. v. Snook, 339 So.2d 1011, 1015 (Ala. 1976).

Moreover, "inadequacy of a remedy at law is one of the foundation stones of equity jurisdiction, and it is a fundamental rule that before a complainant is entitled to relief in a court of equity he must have no plain and adequate remedy at law." White v. Hale, 234 Ala. 385, 386, 175 So. 288, 289 (1937). Dr. Lynd has not demonstrated that there is no plain and adequate remedy at law available to her.

Because Dr. Lynd has failed to demonstrate that she should receive the fair value of her stock in MCP, the trial court did not err in denying her motion for a summary judgment.

IV. Conclusion

Dr. Lynd has demonstrated that the trial court erred in applying § 10-4-228 and therefore also in ordering that MCP redeem Dr. Lynd's shares at book value. In other words, the trial court erred in entering a summary judgment in favor of MCP. However, Dr. Lynd has not adequately demonstrated that she was entitled as a matter of law to the specific relief she requested, i.e., valuation of her stock in MCP based on fair value. Therefore, the trial court did not err in refusing to enter a summary judgment in Dr. Lynd's favor. Therefore, we reverse the summary judgment entered in favor of MCP and remand this case to the trial court for further proceedings consistent with this opinion.

REVERSED AND REMANDED.

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

      Concerning book value, one court has explained:
      " 'Book value of a share of stock, in its simplest form, is the corporation's assets minus its liabilities as shown on the corporate books, divided by the number of shares of stock outstanding.' 1 O'Neal's Close Corporations § 7.27. This method of valuation is frequently used in buy-out agreements because of its simplicity. While book value gives a 'snapshot' of the value of a corporation at any point in time, it is not intended to represent the fair market value of a corporation. It does not, for example, reflect the value of company goodwill. The value of the company's assets and equipment as shown on the balance sheet represents the depreciated value of such assets, not their fair market value."
      Crowder Constr. Co. v. Kiser, 134 N.C. App. 190, 202-03, 517 S.E.2d 178, 187 (1999).

      The 2009 amendment, which was part of an extensive rewriting of the Business Code, was effective January 1, 2011.

      Section 10A-2-13.01, Ala. Code 1975, defines " 'Fair Value,' with respect to a dissenter's shares" to mean "the value of the shares immediately before the effectuation of the corporate action to which the dissenter objects, excluding any appreciation or depreciation in anticipation of the corporate action unless exclusion would be inequitable." Section 10A-2-13.01 is relevant because § 10A-4-1.02, Ala. Code 1975, states that "[t]he provisions of the Alabama Business Corporation Law shall apply to professional corporations, domestic and foreign, except to the extent the provisions are inconsistent with the provisions of this chapter ...."

      Article ten of the articles of incorporation provides:
      "In the event a shareholder becomes legally disqualified to practice medicine in the State of Alabama ... the financial and employment interest of said shareholder in this corporation shall terminate and his shares in said corporation shall be disposed of in a manner to be established by the By-Laws of this Corporation or by written agreement existing between the shareholders at such time."
      Article thirteen of the articles of incorporation provides: "All shareholders of the corporation shall be employees of the corporation ...."

      It appears that, after she left Alabama for Oklahoma, Dr. Lynd became licensed and now practices medicine there. Dr. Lynd did not argue in the trial court and makes no effort to demonstrate to this Court that Oklahoma is not a "qualified state." § 10A-4-1.03(7), Ala. Code 1975. See Rule 28(a)(10), Ala. R. App. P.; Ex parte Borden, 60 So.3d 940, 944 (Ala. 2007) (noting that "waiver of an argument for failure to comply with Rule 28(a)(10), Ala. R. App. P.," occurs when "there is no argument presented in the brief and there are few, if any, citations to relevant legal authority, resulting in an argument consisting of undelineated general propositions").


author: THOMAS, Judge.

text:
    Bridgette MORROW v. S. Lee PAKE
    2170012
    Court of Civil Appeals of Alabama.
    April 20, 2018
    Paula W. Hinton and William M. Logan of Winston & Strawn LLP, Houston, Texas; and Yuri R. Linetsky and Caryn S. Roseman, Civil Law Clinic, University of Alabama School of Law, Tuscaloosa, for appellant.
    James J. Jenkins and Corey G. Seale of Phelps, Jenkins, Gibson & Fowler, LLP, Tuscaloosa, for appellee.
    Michael Forton and Joseph Abrams of Legal Services of Alabama, Huntsville; and Phillip Ensler of Alabama Appleseed, Montgomery, for amici curiae Legal Services of Alabama and Alabama Appleseed Center for Law & Justice, in support of the appellant.
   THOMAS, Judge.

Bridgette Morrow appeals from a summary judgment entered by the Tuscaloosa Circuit Court ("the circuit court") in favor of S. Lee Pake. We reverse the circuit court's judgment and remand this cause for further proceedings.

Background

In 2014, Morrow began renting a house from Pake, pursuant to the terms of a written residential rental agreement. After the term of the rental agreement expired, Morrow began renting the property on a month-to-month basis. In August 2016, Pake, acting pro se, initiated an unlawful-detainer action ("the unlawful-detainer action") against Morrow in the Tuscaloosa District Court ("the district court") by filing a form complaint, specifically, Form C-59 that is provided by the Unified Judicial System.

Form C-59 provides, in relevant part:

"1. Plaintiff(s) demands the right to possession from the defendant(s) of the following described residential, commercial or other real property located at: _________
"2. Defendant(s) no longer has the right to possession because: _________
"3. Defendant(s) right of possession has been lawfully terminated by written notice.
"4. Plaintiff(s) also claims the sum of $ ____ plus court costs from the Defendant(s) consisting of: unpaid rent and late charges, plus attorney's fees (if applicable) and other charges.
"5. Plaintiff(s) also claims future rent and late charges, plus attorney's fees (if applicable) and other charges accruing through the date Plaintiff(s) obtains possession of the above described property."

In his complaint, Pake entered the address of the real property at issue in the blank space accompanying allegation "1" and the phrase "failure to pay rent" in the blank space accompanying allegation "2." Pake did not enter an amount of unpaid rent in the blank space accompanying allegation "4."

Morrow responded to Pake's complaint by filing a form answer in which she, by selecting specific pre-filled options, denied that Morrow was entitled to possession of the property and dfenied that she owed him any money. Morrow's answer did not include any counterclaims. The district court thereafter scheduled an "eviction hearing." Before the hearing, however, Pake sent a letter to the district court in which he asked the district court to dismiss his action, explaining: "The tenant has moved." In September 2016, the district court entered a judgment that provided, in its entirety: "Motion to dismiss filed by [Pake] is hereby granted with prejudice."

Sometime later, Morrow initiated an action against Pake in the district court seeking damages totaling $8,167. See § 12-12-30, Ala. Code 1975 (providing, in relevant part, that district courts have subject-matter jurisdiction over "all civil actions in which the matter in controversy does not exceed ten thousand dollars ($10,000), exclusive of interests and costs"). In her complaint, Morrow asserted several claims based on Pake's alleged violation of various protections afforded her under the Alabama Uniform Residential Landlord and Tenant Act, § 35-9A-101 et seq., Ala. Code 1975 ("the Act"). See § 35-9A-105, Ala. Code 1975 (providing, in relevant part: "(a) The remedies provided by this chapter [i.e., the Act] shall be so administered that an aggrieved party may recover appropriate damages" and "(b) Any right or obligation declared by this chapter is enforceable by action unless the provision declaring it specifies a different and limited effect.").

In February 2017, Pake filed, with the assistance of counsel, a motion to dismiss Morrow's complaint, in which he argued that the claims set out therein were compulsory counterclaims under Rule 13(a), Ala. R. Civ. P., that Morrow had failed to assert in the unlawful-detainer action and that the doctrine of res judicata barred Morrow from relitigating those claims in a subsequent action. On March 16, 2017, the district court entered a judgment granting Pake's motion to dismiss. The judgment provided, in relevant part:

"[Morrow]'s claims in this case are based upon the rights and obligations of the parties pursuant to the lease agreement, which the Court construes as the 'same occurrence or transaction' which was the subject matter of [the unlawful-detainer action]. Accordingly, [Morrow]'s claims are compulsory counterclaims and should have been raised as such in [the unlawful-detainer action]."

The record indicates that Morrow filed a timely notice of appeal in the district court on March 29, 2017, seeking further review in the circuit court. See § 12-12-70(a), Ala. Code 1975 (providing, in relevant part, that "[a]ny party may appeal from a final judgment of the district court in a civil case by filing notice of appeal in the district court, within 14 days from the date of the judgment"); see also Rule M of the Alabama Small Claims Rules (providing, in relevant part, that "[a] judgment may be appealed to the circuit court by the filing of a notice of appeal in the office of the clerk of the small claims court within fourteen days from the date of the judgment").

In May 2017, Pake filed an answer in the circuit court, generally denying the allegations set out in Morrow's complaint and again asserting, in relevant part, that her claims were barred by the doctrine of res judicata. In his answer, Pake also asserted a counterclaim for sanctions under the Alabama Litigation Accountability Act, § 12-19-270 et seq., Ala. Code 1975 ("the ALAA"). That same day, Pake also filed a summary-judgment motion, to which he attached copies of the parties' residential rental agreement and filings and orders from the unlawful-detainer action.

In his summary-judgment motion, Pake again argued that Morrow's claims were compulsory counterclaims and that they were barred by the doctrine of res judicata, and, in seeking a summary judgment against Morrow regarding her claims, he also specifically asked that the circuit court reserve jurisdiction to determine his counterclaim for sanctions under the ALAA. Morrow thereafter moved to strike Pake's answer and to dismiss his counterclaim for sanctions under ALAA and filed a brief opposing Pake's summary-judgment motion, to which she attached various filings and orders from the unlawul-detainer action, including Pake's letter asking the district court to dismiss the unlawful-detainer action because Morrow had vacated the premises. Pake responded to both Morrow's motion and her brief.

On June 2, 2017, Morrow filed an "amended complaint" in the circuit court, which was, as is demonstrated by the foregoing summary of the proceedings until that point, actually the first complaint that she filed in the circuit court after appealing the district court's judgment. In addition to alleged violations of the Act, Morrow's amended complaint included a count asserting "breach of contract & unjust enrichment" and a count citing Rule 60(b), Ala. R. Civ. P., that she titled "independent action to vacate the district court's order dismissing [the unlawful-detainer] action ... with prejudice." Pake answered Morrow's amended complaint, generally denying her allegations, reasserting his affirmative defenses, "renew[ing]" his counterclaim for sanctions, and "renew[ing]" his summary-judgment motion to include Morrow's "breach of contract & unjust enrichment" count. On June 12, 2017, Pake filed a motion to dismiss Morrow's claim for an "independent action to vacate the district court's order dismissing [the unlawful-detainer] action ... with prejudice." Morrow filed a brief opposing his motion, and Pake responded to the brief.

On June 27, 2017, the circuit court entered an order denying Morrow's motion to dismiss Pake's counterclaim for sanctions but granting her motion to strike Pake's answer in part; Pake filed an amended answer a few days later. On July 6, 2017, Pake filed what he called a "supplemental brief regarding collateral attack on the district court's judgment," and, that same day, Morrow filed what she called a "supplemental brief in opposition to [Pake]'s motion for [a] summary judgment." On August 24, 2017, the circuit court entered an order granting Pake's motion to dismiss Morrow's request for an "independent action to vacate the district court's order dismissing Pake's action ... with prejudice." That same day, the circuit court entered the following order granting Pake's summary-judgment motion:

"This case was before the Court for hearing on June 26, 2017, on the motion for [a] summary judgment filed by defendant [Pake]. Having considered said motion and the briefs, arguments and submissions of the parties the Court finds as follows:
"1. Pake contends in substance that the claims of [Morrow] in this case are barred based upon the doctrine of res judicata because the district court entered an order dismissing [the unlawful-detainer] action with prejudice. As a general proposition, the Court agrees with Pake that the entry of the [district c]ourt's order dismissing [the] unlawful-detainer claim with prejudice acts as a bar to all claims asserted or which could have been asserted not only by Pake but also by Morrow as a compulsory counterclaim. Morrow contended that her claims in this case were not compulsory counterclaims. The Court disagrees with Morrow on this point and finds that her claims were compulsory counterclaims and therefore should have been filed in [the unlawful-detainer] action in [the] district court.
"2. Morrow further contended in substance that res judicata did not apply to bar her claims because the district court actually dismissed [the unlawful-detainer] action for mootness. Morrow cited a host of cases which stand for the proposition that the doctrine of res judicata requires an adjudication on the merits and that a dismissal for mootness is not an adjudication on the merits for purposes of establishing a bar based upon res judicata.
"3. This is a close case. This Court must address circumstances wherein in the district court dismissed [the unlawful-detainer] action with prejudice yet there is evidence that the dismissal was actually based upon mootness. These circumstances, along with the excellent briefs and arguments of the parties led the Court, after the hearing on June 26, 2017, to request that the parties provide supplemental briefs on the following issue:
"Should the Court look only to the order of dismissal itself to determine if a dismissal is with prejudice or can the Court look beyond the face of the order itself to determine whether the dismissal was with prejudice or on some other basis?
"4. After reviewing the supplemental briefs of the parties, the Court agrees with Morrow that the Court can look beyond the face of the dismissal order itself to determine whether the dismissal of [the unlawful-detainer] action in [the] district court was with prejudice or based upon mootness. After considering in detail the briefs and arguments of the parties, the Court found the following factors to be persuasive:
"A. That the district court's order of dismissal with prejudice was clearly a dismissal under Rule 41(a)(2)[, Ala. R. Civ. P.,] and the dismissal was 'upon terms and conditions as the Court deems proper.' The dismissal was by a Court which certainly had the jurisdiction to do so. The district court had personal jurisdiction over the parties and subject-matter jurisdiction over the unlawful detainer cause of action.
"B. If Morrow wanted to challenge the dismissal with prejudice order entered by the district court, then Morrow could have objected to the dismissal order at the time of its entry or appeal de novo the dismissal itself to circuit court. Morrow did neither.
"Accordingly, defendant Pake's motion for [a] summary judgment based upon the doctrine of res judicata is due to be and is hereby granted."

Morrow filed a timely notice of appeal to this court on October 2, 2017.

Standard of Review

" ' "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)."

Smith v. Fisher, 143 So.3d 110, 122-23 (Ala. 2013).

Analysis

On appeal, Morrow's argument basically focuses on two issues: (1) Whether her claims were compulsory counterclaims in the unlawful-detainer action, such that her failure to assert them in that action barred her from doing so in a subsequent action, and (2) whether the district court's judgment in the unlawful-detainer action constituted an adjudication on the merits of that litigation. In so doing, Morrow also contends that the compulsory-counterclaim issue is a question of first impression. Legal Services of Alabama and Alabama Appleseed Center for Law & Justice, as amici curiae ("the amici"), have also jointly submitted for our consideration an appellate brief in support of Morrow's position, "urg[ing us] to hold that tenants are not required to file all claims as compulsory in unlawful[-]detainer [actions] filed against them." We consider the compulsory-counterclaim issue first.

The compulsory-counterclaim rule is set out in Rule 13, Ala. R. Civ. P.

" Rule 13(a) [, Ala. R. Civ. P.,] requires a person against whom a claim has been asserted to state as a counterclaim any potential claims he or she has against 'any opposing party' if those claims arise out of the same transaction or occurrence that is the subject matter of the original claim. The failure to do so results in the waiver of those potential claims."

Little Narrows, LLC v. Scott, 1 So.3d 973, 979 (Ala. 2008).

Morrow first argues that a conflict exists between Rule 13 and a provision of the Act, specifically, § 35-9A-405(a), Ala. Code 1975, and that the Act therefore supersedes Rule 13. In relevant part, § 35-9A-405(a) provides that, "[i]n an action for possession or in an action for rent when the tenant is in possession, the tenant may counterclaim for any amount the tenant may recover under the rental agreement or this chapter," so long as the tenant pays into court "rent accrued and thereafter accruing as it comes due" (emphasis added). Because the legislature used the word "may" instead of "shall" in § 35-9A-405(a), Morrow argues, her claims would have been permissive counterclaims in the unlawful-detainer action instead of compulsory counterclaims. See Rule 13(b), Ala. R. Civ. P. (providing for permissive counterclaims).

In response, Pake argues that § 35-9A-405(a)

"is not addressing whether or not a tenant must bring a counterclaim for any amount recoverable under the rental agreement or the ... Act. What [ § 35-9A-405(a) ] does address is the issue of whether rent must continue to be paid if a tenant does make a counterclaim and remains in possession."

We agree with Pake that, on its face, § 35-9A-405(a) does not appear to address the issue of compulsory or permissive counterclaims but instead evinces the legislature's intent to establish a prerequisite for asserting counterclaims under certain circumstances. In other words, § 35-9A-405(a) does not indicate whether a tenant's failure to assert counterclaims under those circumstances carries consequences, i.e., an inability to assert the claims in a subsequent action. Section 35-9A-405(a) is silent on that point.

Pake goes on to argue that, had it wished to do so, the legislature could have specifically modified the application of Rule 13 in the Act, and he points to § 35-9A-461(e), Ala. Code 1975, and § 35-9A-141(3), Ala. Code 1975, which, under certain circumstances, modify the application of portions of Rule 62, Ala. R. Civ. P., and Rule 6, Ala. R. Civ. P., respectively. Again, we agree with Pake that the legislature could have modified the application of Rule 13 and that the Act does not expressly do so. We therefore turn to Morrow's next argument.

Alternatively, Morrow asserts that her claims were not compulsory counterclaims in the unlawful-detainer action because they have no "logical relationship" to the unlawful-detainer action. Among other things, Morrow points us to § 35-9A-426, Ala. Code 1975, which provides, in its entirety:

"If a rental agreement is terminated, the landlord has a claim for possession and for rent and a separate claim for actual damages for breach of the rental agreement and reasonable attorney's fees."

In their brief, the amici argue that the language employed in § 35-9A-426 reflects the legislature's intent to acknowledge a distinction between actions for possession, which they contend require only in rem jurisdiction, and actions for damages, which they contend require in personam jurisdiction, and they cite two cases that predate the Act, Greene v. Lindsey, 456 U.S. 444, 102 S.Ct. 1874, 72 L.Ed.2d 249 (1982), and Gaudin v. Collateral Agency, Inc., 624 So.2d 631 (Ala. Civ. App. 1993), in which they say the United States Supreme Court and this court, respectively, also acknowledged such a distinction in addressing service requirements in unlawful-detainer actions. We will therefore further consider the distinctions asserted by Morrow and the amici.

As noted above, Pake initiated the unlawful-detainer action by using a Form C-59 complaint, which unambiguously included a request for possession of the property and at least arguably included requests for past-due unpaid rent and unpaid rent accruing prospectively, although the parties dispute that point in footnotes of their respective appellate briefs, given Pake's failure to specify an amount of past-due unpaid rent in the blank space accompanying allegation "4." It is undisputed, however, that Pake's complaint did not include a separate claim for actual damages resulting from any alleged breach of the rental agreement by Morrow, as is contemplated by § 35-9A-426. At most, therefore, Pake sought only possession of the property and unpaid rent in his complaint.

Rule 13(a), Ala. R. Civ. P., specifically provides, in relevant part:

"A pleading shall state as a counterclaim any claim which at the time of serving the pleading the pleader has against any opposing party, if it arises out of the transaction or occurrence that is the subject matter of the opposing party's claim and does not require for its adjudication the presence of third parties of whom the court cannot acquire jurisdiction.
But the pleader need not state the claim if: ... (2) the opposing party brought suit upon his claim by attachment or other process by which the court did not acquire jurisdiction to render a personal judgment on that claim, and the pleader is not stating any counterclaim under this Rule 13."

(Emphasis added.) The Committee Comments on 1973 Adoption of Rule 13 elaborate: "The rule does not apply the bar to subsequent action if the defendant is before the court only by in rem jurisdiction. In personam jurisdiction is essential before the failure to plead a compulsory counterclaim becomes consequential." Rule 13(dc), Ala. R. Civ. P., makes Rule 13(a) applicable in district courts.

In Krasner v. Gurley, 248 Ala. 686, 689, 29 So.2d 224, 227 (1947), our supreme court noted the following: " 'In an action for unlawful detainer the recovery of rent is a mere incident to the recovery of possession of the land' " and "the proceeding is quasi in rem, the land being within the jurisdiction of the court." (Quoting Giddens v. Bolling, 92 Ala. 586, 590, 9 So. 274, 275 (1891).) Our supreme court has also explained: "A quasi in rem action is an action 'against the person in respect of the res, where, for example, it has for its object partition, or the sale or other disposition of [the] defendant's property.' " Ex parte Bruner, 749 So.2d 437, 440 (Ala. 1999) (quoting Gill v. More, 200 Ala. 511, 517, 76 So. 453, 459 (1917) ).

Assuming, therefore, that Pake's complaint included both a request for possession of the property and a request for unpaid rent, the latter of which the parties dispute, he sought a judgment against Morrow only "in respect of" the property in question. See id. In other words, the relief sought in Pake's complaint invoked only the district court's quasi in rem jurisdiction. Moreover, as noted above, Morrow did not assert any counterclaims in the unlawful-detainer action. Thus, because the unlawful-detainer action was not an in personam proceeding, the exception to the compulsory-counterclaim rule provided by Rule 13(a)(2) relieved Morrow from asserting her claims in the unlawful-detainer action.

Regarding the second issue raised by Morrow on appeal, which relates to the question whether her claims are barred by the doctrine of res judicata, we note that Rule 13(a) also provides, in relevant part:

"In the event an otherwise compulsory counterclaim is not asserted in reliance upon any exception stated in paragraph (a), relitigation of the claim may be barred by the doctrines of res judicata or collateral estoppel by judgment in the event certain issues are determined adversely to the party electing not to assert the claim."

Because Pake moved the district court to dismiss the unlawful-detainer action after Morrow had vacated the property-indicating his desire to withdraw his allegations against her-the district court's judgment in the unlawful-detainer action did not determine any issues raised therein adversely to Morrow. Thus, we also conclude that, based on Rule 13(a), Morrow's claims are not barred by the doctrine of res judicata. We reverse the circuit court's summary judgment in favor of Pake on Morrow's claims, and we remand the cause for further proceedings.

REVERSED AND REMANDED.

Thompson, P.J., and Pittman, J., concur.

Moore, J., concurs in the result, without writing.

Donaldson, J., recuses himself.

      Although a provision of the Act, § 35-9A-461(d), Ala. Code 1975, supersedes § 12-12-70(a), Ala. Code 1975, and requires that a notice of appeal to a circuit court be filed within seven days, that requirement applies only to "eviction judgment[s]" and not to judgments addressing only "money claim[s]." See Radcliff v. Hall Hous. Invs., Inc., 47 So.3d 1258, 1261-62 (Ala. Civ. App. 2010) (explaining, in the context of finality, that § 35-9A-461(d) distinguishes "eviction judgment[s]" from "final judgment[s]" so as to provide "an expedited avenue of appeal from [eviction] judgments" specifically).

      As noted above, the circuit court granted Pake's summary-judgment motion, and, in his motion, Pake asked that the circuit court specifically reserve jurisdiction to consider his counterclaim for sanctions under the ALAA. The circuit court, however, did not do so in its judgment, and Pake did not file a postjudgment motion seeking such a reservation of jurisdiction. The circuit court's judgment therefore implicitly denied Pake's counterclaim for sanctions, and, because all other pending claims were resolved, the circuit court's judgment was a final judgment. See Klinger v. Ros, 33 So.3d 1258, 1260 (Ala. Civ. App. 2009) ("Our supreme court has held that, when a trial court enters an otherwise final judgment on the merits of a case but fails to address a pending ALAA claim or to reserve jurisdiction to later consider that claim, the ALAA claim is implicitly denied by the judgment on the merits.").

      Morrow does not argue that the circuit court erred by granting Pake's motion to dismiss her "independent action to vacate the district court's order dismissing Pake's action ... with prejudice," and we will therefore not consider that issue on appeal. See Ex parte Riley, 464 So.2d 92, 94 (Ala. 1985).

      Rule 13(dc) also creates yet another exception to the compulsory-counterclaim rule "when the claim is beyond the jurisdiction" of the district court. Because Morrow's claims sought damages totaling only $8,167, however, that exception does not apply in this case. See § 12-12-30.

      See Ex parte Chesnut, 208 So.3d 624, 635 (Ala. 2016) ("The elements of res judicata are ' "(1) a prior judgment on the merits, (2) rendered by a court of competent jurisdiction, (3) with substantial identity of the parties, and (4) with the same cause of action presented in both actions." ' Chapman Nursing Home, Inc. v. McDonald, 985 So.2d 914, 919 (Ala. 2007) (quoting Equity Res. Mgmt., Inc. v. Vinson, 723 So. 2d 634, 636 (Ala. 1998) ).").