Case Title: White-Spunner Construction, Inc. v. Construction Completion Company, LLC

Citation: 

Docket Number: 1101285

State: alabama

Court: Alabama Supreme Court

Date: 2012-06-22T00:00:00Z

Document:
REL: 06/22/2012
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter.  Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
OCTOBER TERM, 2011-2012
____________________
1101285
____________________
White-Spunner Construction, Inc., and Hartford Fire
Insurance Company
v.
Construction Completion Company, LLC, and Buena Vista
Construction, LLC
____________________
1101340
____________________
Construction Completion Company, LLC
v.
Hartford Fire Insurance Company
Appeals from Mobile Circuit Court
2
(CV-09-900336)
STUART, Justice.
White-Spunner Construction, Inc., and Hartford Fire
Insurance Company ("Hartford") appeal the summary judgment and
the award of attorney fees in favor of Construction Completion
Company, LLC ("CCC"), in CCC's action alleging that White-
Spunner failed to pay it for labor and materials it provided
as a subcontractor to White-Spunner in the fall of 2008 in
conjunction 
with 
White-Spunner's 
work 
as 
the 
general
contractor on a public-works project at Auburn University
(case no. 1101285).  CCC cross-appeals, arguing that the
Mobile Circuit Court erred in dismissing its bad-faith and
fraud claims against Hartford, which had issued payment bonds
to White-Spunner for the project (case no. 1101340).  We
reverse the judgment in case no. 1101285 and dismiss the
appeal in case no. 1101340.
I.
In 
May 
2008, 
White-Spunner, 
a 
licensed 
general
contractor, signed two contracts worth approximately $99
million to construct eight four-story dormitory buildings at
1101285, 1101340
3
Auburn University ("the Auburn project").  As required by §
39-1-1(a), 
Ala. 
Code 
1975, 
White-Spunner 
subsequently 
obtained
two payment bonds from Hartford, one of which would compensate
Auburn in the event White-Spunner failed to perform under the
contract, the other of which would be used to compensate
subcontractors and suppliers in the event White-Spunner failed
to do so in a timely fashion.
After construction on the Auburn project began, White-
Spunner subcontracted with CCC, which also held a general
contractor's license, to provide labor, materials, and
services in connection with the framing of the buildings being
constructed.  Under the terms of their agreement, CCC agreed
to provide workers for the project and White-Spunner agreed to
pay CCC a set fee for each man-hour worked pursuant to the
following schedule:  $42 per hour for a "lead man," $32 per
hour for an experienced carpenter, and $22 per hour for a
carpenter's helper.  In its proposal setting these terms, CCC
further stated:
"At the rates listed, we will be able to provide
the best labor with the best tools for this job.
These rates include any and all supervision, labor,
overtime labor, tools, transportation, per-diem, and
lodging.  We will supply nails to complete the job,
1101285, 1101340
4
but will be submitting those receipts with our
billing to be reimbursed."
CCC also requested that it be paid every two weeks.  An
executed contract memorializing these terms is not included in
the record; however, neither party disputes that these were
the essential terms of their agreement.  It is also undisputed
that either party could terminate their relationship at will.
Subsequently, 
CCC 
subcontracted 
with 
Buena 
Vista
Construction, LLC ("Buena Vista"), a Florida company, for
Buena Vista to provide CCC with the workers CCC needed to
fulfill its agreement with White-Spunner.  Although it appears
that no written contract was executed between Buena Vista and
CCC, Buena Vista did provide CCC with a certificate of
insurance establishing that it held commercial general-
liability and workers' compensation policies.  Invoices in the
record submitted by Buena Vista to CCC also indicate that CCC
generally paid Buena Vista between $19.50 and $21.50 for each
man-hour worked.  The workers provided CCC by Buena Vista wore
CCC uniforms on the construction site and, CCC alleges, were
at all times under the direct control of CCC's owner Richard
Jensen and/or CCC's direct employee, Richard Able.  White-
Spunner apparently had no knowledge of CCC's separate
1101285, 1101340
5
agreement with Buena Vista.  It is undisputed that Buena Vista
was not licensed as a contractor in Alabama during this time.
For some time, it appears that there were no problems
with this arrangement.  Workers would arrive on the job site
each day and sign in and out on daily time sheets that were
also signed by White-Spunner superintendents.  Copies of the
daily time sheets were apparently then retained by White-
Spunner and by the supervisors among the workers supplied to
CCC by Buena Vista.  Buena Vista would then submit weekly
summaries as well as invoices to CCC based on the daily time
sheets, and CCC would then process this information and
prepare invoices that were submitted to White-Spunner every
two weeks, payment being due two weeks thereafter.  Invoices
received by White-Spunner were initially reviewed by Jim
Schjott, 
White-Spunner's 
general 
superintendent 
for 
the 
Auburn
project, and then ultimately approved by Tom Clutter, White-
Spunner's project executive for the Auburn project.
A dispute between CCC and White-Spunner first arose in
October 2008 when White-Spunner made only partial payment on
certain invoices based on a belief that the invoices submitted
could not be reconciled with the progress of the Auburn
1101285, 1101340
It appears that after White-Spunner failed to make full
1
payment to CCC in October, CCC did not make full payment to
Buena Vista.  The record is unclear as to whether Buena Vista
ultimately refused to work further for CCC without full
payment, 
thus 
requiring 
CCC's 
shutdown, 
or 
if 
CCC
independently elected to stop work on the Auburn project.
6
project.  This dispute was apparently never resolved; however,
CCC continued working on the Auburn project, and White-Spunner
thereafter paid at least some subsequently submitted invoices
in full.  By December 8 however, CCC was apparently either
unwilling or unable to keep working without being paid the
balance of the October invoices –– $255,859.48 –– and it
accordingly ceased work on the Auburn project.   On December
1
12, 2008, CCC sent White-Spunner a letter from its attorney
demanding $698,468.93 as payment on all outstanding invoices.
In an affidavit later submitted in conjunction with
White-Spunner and Hartford's motion opposing CCC's motion for
a partial summary judgment, Clutter described the genesis of
the dispute with CCC as follows and claimed never to have
received the November 28 and December 10 invoices –– totaling
$298,482.00 and $144,127.45, respectively –– prior to CCC's
initiating this litigation:
"4.  During the month of October 2008, a series
of invoices were submitted by [CCC] which were not
justified by the descriptions of work provided with
1101285, 1101340
7
the invoices or the observed progress of work on the
project.  Upon receiving these invoices and noting
the discrepancies, I disputed these invoices through
numerous meetings with [CCC's] principal, Richard
Jensen.  I expressed my concerns to Mr. Jensen,
asked him to provide additional documentation or
explanation to account for the disparity between the
amount of work which had been billed compared with
the 
amount 
of 
work 
which 
had 
actually 
been
performed.  Where the progress on the project
justified payment, payment of the undisputed amounts
was made. [CCC] did not submit the additional
justification as requested, although it did continue
to work and its bills were paid.
"5.  During this process I had numerous
conversations 
with 
general 
superintendent 
Jim
Schjott to clarify his role as an initial reviewer
of 
[CCC's] 
invoices 
to 
make 
sure 
they 
were
consistent with work which was being performed.  It
was my impression that the conversations I had with
both Rich Jensen and Jim Schjott led directly to the
submission of subsequent invoices which I felt
accurately reflected work done and progress made on
the project.
"6.  During the course of [CCC's] work on this
project the original invoices were submitted to the
White-Spunner project office at Auburn.  Invoices
were not submitted to the Mobile office because the
necessary review of project progress and daily sign-
in documentation was conducted on the job site at
Auburn.  Once the invoices were received they were
initially reviewed by general superintendent Jim
Schjott and submitted to me for final review and
approval.
"7.  Jim Schjott left the Auburn project before
the Thanksgiving weekend of 2008 and did not return
until December 8.  Upon his return, Mr. Schjott
submitted his retirement from employment with White-
Spunner Construction.  Mr. Schjott's request for
1101285, 1101340
Section 39-1-1(b), Ala. Code 1975, states:
2
"Any person that has furnished labor, materials, or
supplies for or in the prosecution of a public work
and payment has not been made may institute a civil
action upon the payment bond and have their rights
and claims adjudicated in a civil action and
judgment entered thereon.  Notwithstanding the
foregoing, a civil action shall not be instituted on
the bond until 45 days after written notice to the
surety of the amount claimed to be due and the
nature of the claim. ...  In the event the surety or
contractor fails to pay the claim in full within 45
days from the mailing of the notice, then the person
or persons may recover from the contractor and
surety, in addition to the amount of the claim, a
reasonable attorney's fee based on the result,
together with interest on the claim from the date of
the notice."
8
retirement was accepted and his duties on the Auburn
project 
were 
assumed 
by 
others 
pending 
his
retirement.
"8.  During the time Mr. Schjott was away from
the project I was made aware of all invoices which
were submitted for payment.  I did not receive or
review any invoices from [CCC] after Thanksgiving
2008.  White-Spunner has no record of these invoices
being submitted during the course of [CCC's] work on
this project.  I have been shown invoices in the
course of this lawsuit dated November 28 and
December 10, 2008.  This is the first time I have
seen these invoices."
White-Spunner did not make any payments to CCC in
response to the December 12 letter, and, on December 23, 2008,
CCC sent Hartford a letter demanding payment on White-
Spunner's payment bond pursuant to § 39-1-1, Ala. Code 1975.2
1101285, 1101340
9
Hartford requested additional information from CCC so that it
could investigate the claim, and, on February 5, 2009, CCC
sent Hartford copies of daily time sheets, invoices, and other
information.  On February 18, 2009, after receiving no payment
from either White-Spunner or Hartford, CCC filed the instant
action in the Mobile Circuit Court.
In its initial complaint, CCC named White-Spunner,
Hartford, and Buena Vista as defendants.  It generally alleged
that White-Spunner had breached its contract with CCC and that
White-Spunner and Hartford had violated § 39-1-1, but it also
disputed the amounts claimed by Buena Vista in invoices it had
submitted to CCC and sought a declaratory judgment setting
forth the amount it owed Buena Vista.  CCC subsequently
amended its complaint to assert a promissory-fraud claim
against White-Spunner and bad-faith-failure-to-pay and fraud
claims against Hartford as well.  
White-Spunner and Hartford filed separate answers to the
complaint, and White-Spunner also asserted a counterclaim
against CCC alleging that CCC had performed unacceptable work
and had, in fact, breached its contract with White-Spunner.
CCC denied that claim in its own subsequently filed answer.
1101285, 1101340
10
Buena Vista thereafter filed its answer, asserting a
counterclaim against CCC and alleging that it had entered into
an agreement with CCC to "provide materials, labor, and other
various construction services" for the Auburn project and that
CCC had breached its agreement to compensate Buena Vista for
those items and services.  Buena Vista also asserted cross-
claims against White-Spunner and Auburn University, alleging
that they had benefited from the work and materials provided
by Buena Vista for which it had not been paid, and against
Hartford as the issuer of the payment bond on the Auburn
project.
On August 27, 2010, CCC moved for a summary judgment
against Buena Vista, arguing that Buena Vista was an
unlicensed contractor at the time it performed work for CCC
and that, accordingly, it could not recover any amounts
allegedly still owed it by CCC because their contract was
void.  See, e.g., Twickenham Station, Inc. v. Beddingfield,
404 So. 2d 43, 45 (Ala. 1981) (stating that it is illegal for
an unlicensed contractor to contract to perform the work of a
contractor as defined in § 34-8-1, Ala. Code 1975, and that
any such contract is void and unenforceable).  Buena Vista
1101285, 1101340
As part of their agreement, CCC and Buena Vista executed
3
a "tolling and arbitration agreement," whereby they agreed to
toll their claims against each other for an initial period of
12 months, after which the tolling period could be extended
further or any still existing claims pursued in arbitration.
11
opposed the motion, arguing that it had not acted as a
contractor; rather, it argued that it had only provided
laborers to CCC and stated that it had never engaged in
construction activities, had never had supervisory duties, and
had never superintended laborers as part of the Auburn
project.
CCC and Buena Vista thereafter reached an agreement to
dismiss the claims they had asserted against each other and
filed a joint stipulation of dismissal with the trial court.3
White-Spunner and Hartford objected to the dismissal of Buena
Vista, and White-Spunner later amended its counterclaim
against CCC to seek a declaratory judgment regarding the
rights of the parties in light of the alleged illegal and
unenforceable contract between CCC and Buena Vista.  On
October 26, 2010, the trial court granted CCC and Buena
Vista's joint motion to dismiss the claims they had asserted
against each other, as well as Buena Vista's motion to dismiss
its claims against Auburn University, White-Spunner, and
1101285, 1101340
12
Hartford.  On November 4, 2010, the trial court also dismissed
White-Spunner's 
counterclaim 
seeking 
a 
declaratory 
judgment 
as
to the rights of the parties in  light of the alleged illegal
contract between CCC and Buena Vista.  On November 8, 2010, on
Hartford's motion, the trial court dismissed CCC's bad-faith-
failure-to-pay and fraud claims against Hartford.
CCC, on the one hand, and White-Spunner and Hartford, on
the other, thereafter filed competing motions for a summary
judgment.  On February 24, 2011, the trial court entered a
summary judgment in favor of CCC, holding that White-Spunner
had failed to timely pay CCC amounts it was due under their
contract for the disputed October 2008 invoices and the unpaid
November 28, 2008, and December 10, 2008, invoices, awarding
CCC a total principal sum of $698,468.93 and interest in the
amount of $127,462.27.  The trial court also dismissed White-
Spunner's remaining counterclaim against CCC.  The trial court
further granted CCC leave to prove attorney fees because such
fees were specifically authorized by § 39-1-1.  CCC
subsequently submitted evidence supporting its claim for
attorney fees, and, on April 21, 2011, the trial court held a
hearing on that claim. 
1101285, 1101340
13
On May 11, 2011, the trial court entered a final judgment
in favor of CCC and against White-Spunner and Hartford,
reaffirming the $825,931.20 in damages awarded CCC in the
trial court's February 24 order and awarding CCC an additional
$289,075.90 in attorney fees.  The trial court also awarded
CCC an additional $5,661.59 for expenses, but it noted that
only White-Spunner –– not Hartford –– was liable for that
amount because § 39-1-1 contained no provision for recovering
expenses from a surety.  White-Spunner and Hartford's
subsequent motion to alter, amend, or vacate that judgment was
denied by the trial court on June 27, 2011, and, on August 2,
2011, White-Spunner and Hartford filed their notice of appeal
to this Court.  On August 9, 2011, CCC filed a cross-appeal,
arguing that the trial court had erred in dismissing its bad-
faith-failure-to-pay and fraud claims against Hartford.
II.
White-Spunner and Hartford argue that the trial court
erred in entering a summary judgment in favor of CCC.  We
review this argument pursuant to the following standard:  
"This Court's review of a summary judgment is de
novo.  Williams v. State Farm Mut. Auto. Ins. Co.,
886 So. 2d 72, 74 (Ala. 2003).  We apply the same
standard of review as the trial court applied.
1101285, 1101340
14
Specifically, we must determine whether the movant
has made a prima facie showing that no genuine issue
of material fact exists and that the movant is
entitled to a judgment as a matter of law. Rule
56(c), Ala. R. Civ. P.; Blue Cross & Blue Shield of
Alabama v. Hodurski, 899 So. 2d 949, 952-53 (Ala.
2004).  In making such a determination, we must
review the evidence in the light most favorable to
the nonmovant.  Wilson v. Brown, 496 So. 2d 756, 758
(Ala. 1986).  Once the movant makes a prima facie
showing that there is no genuine issue of material
fact, the burden then shifts to the nonmovant to
produce 'substantial evidence' as to the existence
of a genuine issue of material fact.  Bass v.
SouthTrust Bank of Baldwin County, 538 So. 2d 794,
797-98 (Ala. 1989); Ala. Code 1975, § 12-21-12."
Dow v. Alabama Democratic Party, 897 So. 2d 1035, 1038-39
(Ala. 2004).
III.
White-Spunner and Hartford argue that the trial court
erred in entering a summary judgment in favor of CCC because,
they allege, CCC is effectively suing them to recover money it
claims it was owed as a result of work it hired Buena Vista to
complete.  However, White-Spunner and Hartford argue, because
Buena Vista was an unlicensed contractor, its contract with
CCC was illegal and void, and CCC accordingly cannot prevail
on its claims.  See, e.g., Ex parte W.D.J., 785 So. 2d 390,
393 (Ala. 2000) ("Moreover, this Court has held that '[a]
person cannot maintain a cause of action if, in order to
1101285, 1101340
15
establish it, he must rely in whole or in part on an illegal
or immoral act or transaction to which he is a party.'  Hinkle
v. Railway Express Agency, 242 Ala. 374, 378, 6 So. 2d 417,
421 (1942).  In Oden v. Pepsi Cola Bottling Co., 621 So. 2d
953 (Ala. 1993), this Court stated that the purpose of the
Hinkle rule is to ensure that '"those who transgress the moral
or criminal code shall not receive aid from the judicial
branch of government."'"  621 So. 2d at 955 (emphasis
omitted)).  CCC disputes that its contract with Buena Vista
was illegal; however, it argues that White-Spunner and
Hartford have no standing to challenge the status of that
contract regardless of the ultimate determination of its
legality.  Before considering the substantive issue of the
legality of the contract, we first consider CCC's standing
argument.
CCC argues that White-Spunner and Hartford are strangers
to CCC's contract with Buena Vista and that they accordingly
may not attack its legality:
"White-Spunner is a stranger to CCC's contract
with Buena Vista; neither a party nor a third-party
beneficiary thereof.  'It is well settled law that
"one not a party to, or in privity with a contract,
cannot sue for its breach."' Bernals, Inc. v.
Kessler-Greystone, LLC, 70 So. 3d 315, 319 (Ala.
1101285, 1101340
16
2011); Dunning v. New Eng. Life Ins. Co., 890 So. 2d
92, 97 (Ala. 2003) (holding standing to sue under a
contract requires plaintiff to be in privity or an
intended third-party beneficiary); Twine v. Liberty
Nat'l Life Ins. Co., 311 So. 2d 299, 305 (Ala. 1975)
(standing to sue on contract must be based on
privity); [and] Weathers Auto Glass, Inc. v. Alfa
Mut. Ins. Co., 619 So. 2d 1328, 1389 (Ala. 1993) (to
be a third-party beneficiary, party must show
contracting 
parties 
intended 
direct 
benefit).
[White-Spunner and Hartford's] lack of standing bars
any attack on [the] CCC/[Buena Vista] contract by
White-Spunner, whether called declaratory judgment
or as affirmative defense."
CCC's brief, pp. 40-41.  White-Spunner and Hartford dispute
CCC's claim that White-Spunner was not a third-party
beneficiary to the contract between CCC and Buena Vista;
regardless, however, they argue that the cases cited by CCC
are inapposite because, they argue, they are not asserting
claims "under" a contract or based on a breach of that
contract.  Rather, they argue, their argument regarding the
legality of the contract between CCC and Buena Vista is
consistent with the well settled principle of law that "'a
party to an illegal contract cannot come into a court of law
and ask to have his illegal objects carried out ....'"
Thompson v. Wiik, Reimer & Sweet, 391 So. 2d 1016, 1020 (Ala.
1980) (quoting 17 C.J.S. Contracts § 272 (1963)).  In support
of their argument that they need not have been a party to the
1101285, 1101340
17
alleged illegal contract to raise the issue of the validity of
the contract in the instant lawsuit, White-Spunner and
Hartford cite Bankers & Shippers Insurance Co. of New York v.
Blackwell, 255 Ala. 360, 51 So. 2d 498 (1951).  In Blackwell,
the plaintiff contracted to transport a cargo of lawnmowers in
interstate commerce; however, after those lawnmowers were
damaged in transit, the plaintiff's insurer refused to make
payment, notwithstanding the existence of a presumptively
valid transportation policy it had issued the plaintiff.
After the trial court entered a judgment in the plaintiff's
favor, this Court reversed that judgment because the plaintiff
was not properly licensed to transport the lawnmowers,
stating:
"Another statement by this Court is 'that
contracts specially prohibited by law, or the
enforcement of which violated a law, or the making
of which violated the law which was enacted for
regulation and protection, as distinguished from a
law created solely for revenue purposes, is void and
nonenforceable  ....  Whenever a party requires the
aid of an illegal transaction to support his case,
he cannot recover.'  Ellis v. Batson, [177 Ala. 313,
317, 58 So. 193, 194 (1912)]; Pope v. Glenn Falls
Ins. Co., 136 Ala. 670, 34 So. 29 [(1903)].  See,
also, 9 A.L.R.2d 184.
"Plaintiff's contract of insurance was not
prohibited by law.  While the Motor Transportation
Act is for regulation and protection, the insurance
1101285, 1101340
Like the Motor Transportation Act at issue in Blackwell,
4
the statutes governing the licensing of contractors in
Alabama, set forth at § 34-8-1 et seq., Ala. Code 1975, were
enacted for the protection of the public; specifically, "to
protect the public against incompetent contractors and to
assure properly built structures which are free from defects
and dangers to the public."  Architectural Graphics & Constr.
Servs., Inc. v. Pitman, 417 So. 2d 574, 576 (Ala. 1982). 
18
here involved did not violate that Act.  But we
think plaintiff could not establish his case without
reference to or in reliance upon an illegal act or
transaction within the principle declared above.
This is for the following reason:  his only
insurable interest is dependent upon an illegal
transaction made so by an act, which was enacted for
regulation and protection and not for revenue.  His
contract to transport the lawnmowers, and the
transportation of them as a contract carrier in
interstate commerce, was illegal and subjected him
to a penalty by virtue of such an act of Congress,
49 U.S.C.A. §§ 309 and 322, which was a regulation
for the protection of the public."
255 Ala. at 366, 51 So. 2d at 502.  The rationale of Blackwell
applies in this case as well.   There is no allegation that
4
CCC's contract with White-Spunner was illegal; however, like
the plaintiff in Blackwell, CCC is alleged to have entered
into an illegal contract with a third party that was directly
related to the subject of the legal contract.  We held in
Blackwell that the party to the legal contract that was a
stranger to the illegal contract could avoid making payment to
the party involved in both the legal and illegal contracts ––
1101285, 1101340
19
notwithstanding the fact that its own contract with that party
was valid –– if the latter party cannot "establish [its] case
without reference to or in reliance upon [the alleged] illegal
act or transaction."  255 Ala. at 366, 51 So. 2d at 502.
Accordingly, White-Spunner and Hartford may raise the issue of
the validity of the contract between CCC and Buena Vista
without violating any standing requirements.
We therefore turn to the issue whether CCC's contract
with Buena Vista was, in fact, illegal.  In considering this
issue, the trial court held that the contract was not illegal
because, it reasoned, Buena Vista was not required to be
licensed to perform the service it was contracted to perform.
The trial court stated:
"[CCC] is a licensed general contractor in
Alabama and was legally authorized to perform its
contract 
with 
White-Spunner. 
 
[CCC] 
directly
employed many of the workers used in performance of
its contract.  [CCC] used Buena Vista as a labor
broker to provide staffing services by sending
temporary workers to supplement [CCC's] workforce as
needed from time to time on the [Auburn] project.
Some of these temporary workers were billed at the
$42.00 per hour [supervisor] rate.  Buena Vista was
not a licensed contractor and, in the aggregate, it
was paid more than $50,000.00 by [CCC].  Buena Vista
did not contract with White-Spunner.
"[CCC] entered into an agreement with Buena
Vista for Buena Vista to provide some of the workers
1101285, 1101340
20
required by [CCC's] contract with White-Spunner.
The court finds Buena Vista was a labor broker;
providing temporary employees to [CCC] as some of
the workforce required by the contract between
White-Spunner and [CCC].  As the licensed general
contractor subcontracted to White-Spunner, [CCC]
directed 
these 
temporary 
workers 
in 
their
performance while on the [Auburn] project.  The
court finds it was [CCC], not Buena Vista, that had
the right of control and actually exercised its
right of control over the activities of these loaned
workers while on the projects. [CCC] directed the
activities of the loaned workers in the same manner
as it directed the activities of its direct
employees.
"Under the facts of this case, the court finds
Buena Vista was not required to be a licensed
contractor under [§ 34-8-1].  The defendants failed
to 
produce 
sufficient 
admissible 
evidence 
to
establish their affirmative defense that [CCC] is
barred from recovery because Buena Vista was not a
licensed contractor in Alabama. [White-Spunner and
Hartford's] motion for summary judgment based on the
affirmative defense of illegality is denied."
White-Spunner and Hartford argue that the trial court's
rationale is erroneous for two reasons: (1) the language of §
34-8-1, Ala. Code 1975, is unambiguous and contains no "labor-
broker" exception; and (2) there is a genuine issue of
material fact as to whether Buena Vista acted as a mere labor
broker based on the level of involvement of Buena Vista and
CCC in the day-to-day operations at the work site and the fact
that CCC required Buena Vista to provide proof that it held a
1101285, 1101340
21
commercial general-liability insurance policy.  In effect,
White-Spunner and Hartford argue, "if there was a mere 'labor
broker' involved, it was CCC.  [Buena Vista] was engaged in
construction; CCC in mark-ups of [Buena Vista's] invoices."
White-Spunner and Hartford's brief, p. 22.  
We begin our examination of the labor-broker issue by
looking to § 34-8-1 et seq., Ala. Code 1975, the chapter of
the Alabama Code governing the licensing of contractors.  This
Court succinctly described its approach when interpreting
statutes in DeKalb County LP Gas Co. v. Suburban Gas, Inc.,
729 So. 2d 270, 275-76 (Ala. 1998):
"In determining the meaning of a statute, this
Court looks to the plain meaning of the words as
written by the legislature.  As we have said:
"'"Words used in a statute must be given
their 
natural, 
plain, 
ordinary, 
and
commonly understood meaning, and where
plain language is used a court is bound to
interpret that language to mean exactly
what it says.  If the language of the
statute is unambiguous, then there is no
room for judicial construction and the
clearly expressed intent of the legislature
must be given effect."'
"Blue Cross & Blue Shield v. Nielsen, 714 So. 2d
293, 296 (Ala. 1998) (quoting IMED Corp. v. Systems
Eng'g Assocs. Corp., 602 So. 2d 344, 346 (Ala.
1992)); see also Tuscaloosa County Comm'n v. Deputy
Sheriffs' Ass'n, 589 So. 2d 687, 689 (Ala. 1991);
1101285, 1101340
22
Coastal States Gas Transmission Co. v. Alabama Pub.
Serv. Comm'n, 524 So. 2d 357, 360 (Ala. 1988);
Alabama Farm Bureau Mut. Cas. Ins. Co. v. City of
Hartselle, 460 So. 2d 1219, 1223 (Ala. 1984); Dumas
Bros. Mfg. Co. v. Southern Guar. Ins. Co., 431 So.
2d 534, 536 (Ala.1983); Town of Loxley v. Rosinton
Water, Sewer, & Fire Protection Auth., Inc., 376 So.
2d 705, 708 (Ala. 1979).  It is true that when
looking at a statute we might sometimes think that
the ramifications of the words are inefficient or
unusual.  However, it is our job to say what the law
is, not to say what it should be.  Therefore, only
if there is no rational way to interpret the words
as stated will we look beyond those words to
determine legislative intent.  To apply a different
policy would turn this Court into a legislative
body, and doing that, of course, would be utterly
inconsistent with the doctrine of separation of
powers.  See Ex parte T.B., 698 So. 2d 127, 130
(Ala. 1997)."
Our ultimate inquiry then, with regard to the labor-broker
issue, is whether Buena Vista's agreement with CCC required it
to engage in activities that required a license under § 34-8-1
et seq.  Section 34-8-1(a) defines general contracting as
follows:
"For the purpose of this chapter, a 'general
contractor' is defined to be one who, for a fixed
price, commission, fee, or wage undertakes to
construct 
or 
superintend 
or 
engage 
in 
the
construction, 
alteration, 
maintenance, 
repair,
rehabilitation, 
remediation, 
reclamation, 
or
demolition 
of 
any 
building, 
highway, 
sewer,
structure, site work, grading, paving or project or
any improvement in the State of Alabama where the
cost of the undertaking is fifty thousand dollars
($50,000) or more, shall be deemed and held to have
1101285, 1101340
23
engaged in the business of general contracting in
the State of Alabama."
A "subcontractor" is defined as one who engages in any of
those same activities while under contract to a general
contractor or another subcontractor.  See § 34-8-1(c).
Section 34-8-7(c), Ala. Code 1975, makes clear that, with some
exceptions not relevant in this case, "a subcontractor, as
defined in subsection (c) of Section 34-8-1, is subject to and
shall comply with all the provisions of this chapter as
specified for general contractor ...."  Both general
contractors and subcontractors are required to go through a
licensing process, and § 34-8-6, Ala. Code 1975, specifically
provides that "[a]ny person, firm, or corporation not being
duly authorized who shall engage in the business of general
contracting in this state ... shall be deemed guilty of a
Class A misdemeanor ...."
In this case, it is undisputed that Buena Vista
contracted with CCC to provide CCC with Buena Vista employees
and that those employees were then used both to frame
buildings and to supervise other Buena Vista employees working
on the Auburn project.  Importantly, White-Spunner and
Hartford emphasize, it is undisputed that Buena Vista
1101285, 1101340
White-Spunner and Hartford have argued that CCC's
5
statements indicating that Buena Vista was an unlicensed
contractor in CCC's subsequently withdrawn motion seeking a
summary judgment against Buena Vista and supporting materials
are further evidence indicating that CCC's contract with Buena
Vista was illegal.  However, although a pleading may be
24
employees did not work simply as consultants, equipment
installers, or performers of menial labor.  Rather, framing is
specifically recognized as a construction activity by the
Licensing Board for General Contractors.  See Ala. Admin. Code
(Licensing 
Board 
for 
General 
Contractors), 
Regulation 
230-X-1-
.27.  We must therefore conclude, in connection with the
Auburn project, that Buena Vista "under[took] to construct or
superintend or engage in the construction ... of [a] building
... in the State of Alabama where the cost of the undertaking
is fifty thousand dollars ($50,000) or more ...."  § 34-8-
1(a).  Or, as CCC itself stated in its motion seeking a
summary judgment against Buena Vista before they agreed to
dismiss their claims against each other:  "In the instant
case, it is undisputed that Buena Vista undertook work in
excess of $50,000 involving the construction, modification or
remediation of buildings in Auburn, Alabama, and thus falls
within the definition of a general contractor in § 34-8-1, et
seq."5
1101285, 1101340
admissible in evidence against a party, a motion for a summary
judgment is not a pleading.  See Ex parte Flodin, 822 So. 2d
372, 378 (Ala. 2001) ("The plaintiffs argue that we should
consider their motion for a summary judgment as a pleading and
look to it for additional support for their contention that
the nature of this action is a breach of contract.  A motion
for a summary judgment is not a 'pleading.'  'Pleadings' are
distinguished from 'motions and other papers' in Rule 7, Ala.
R. Civ. P. ...").
25
CCC nevertheless argues that Buena Vista did not engage
in contracting because, it argues, the employees supplied by
Buena Vista effectively became CCC employees and employees of
a licensed contractor are not required to be licensed
themselves.  Cooper v. Johnston, 283 Ala. 565, 569, 219 So. 2d
392, 395 (1969) (noting that an individual accused of being
unlicensed contractor "was not connected with [the licensed
contracting company] as an officer, partner or employee").  In
support of this argument, CCC cites multiple cases involving
workers' compensation law in which employees provided to a
company by an employment agency are held to be employees of
both the "general employer," i.e., the employment agency, and
the "special employer," i.e., the company to which the
employees are assigned.  See, e.g., Marlow v. Mid South Tool
Co., 535 So. 2d 120, 123 (Ala. 1988) ("In three decisions,
beginning in 1983, this Court has established, for workmen's
1101285, 1101340
26
compensation purposes, that a temporary services employee is
the employee of both his or her general employer (i.e., the
employment agency) and his or her special employer (i.e., the
employer to which the employment agency assigned the employee
to work).").  However, CCC cites no cases where this principle
has been applied outside the workers' compensation context,
and we are not inclined to read a labor-broker exception into
the licensing statutes on the basis of the special-employee
doctrine where the language is otherwise unambiguous.  Section
34-8-7(a), 
Ala. 
Code 1975, 
specifically 
lists 
certain
activities that might be encompassed within the definition of
general contracting in § 34-8-1, but are nevertheless exempted
from licensing requirements.  Those exemptions include:
"(1) The practice of general contracting, as
defined 
in 
Section 
34-8-1, 
by 
an 
authorized
representative or representatives of the United
States Government, State of Alabama, incorporated
town, city, or county in this state, which is under
the supervision of a licensed architect or engineer
provided 
any 
work 
contracted 
out 
by 
the
representative shall comply with the provisions of
this chapter for 'general contractor.'
"(2) The construction of any residence or
private dwelling.
"(3) A person, 
firm, 
or 
corporation 
constructing
a building or other improvements on his, her, or its
own 
property 
provided 
that 
any 
of 
the 
work
1101285, 1101340
27
contracted out complies with the definition in this
chapter for 'general contractor.'
"(4) The installation, repair, maintenance, or
removal of facilities, equipment, or systems used in
or 
substantially 
related 
to 
the 
generation,
transmission, or distribution of electric power,
natural gas, or telecommunications in an emergency
by a utility regulated by the Public Service
Commission, or any entity engaged in the generation,
transmission, or distribution of electric power,
natural gas, or telecommunications, or any of their
respective general contractors or subcontractors,
provided the work is performed under the supervision
of a licensed architect or engineer.  For purposes
of this subdivision, the term 'emergency' is defined
as a situation whereby service to the consumer has
been interrupted or may be interrupted if work to
remedy the emergency is not performed and completed
within 60 days, and such other situations that are
determined to be an emergency in the discretion of
the board.
"(5) The repair, maintenance, replacement,
reinstallation, or removal of facilities, equipment,
or systems used in or substantially related to the
generation, 
transmission, 
or 
distribution 
of
electric power, natural gas, or telecommunications
on a routine, regular, or recurring basis by a
utility regulated by the Public Service Commission
or 
any 
entity 
engaged 
in 
the 
generation,
transmission, or distribution of electric power,
natural gas, or telecommunications or any of their
respective general contractors or subcontractors,
provided the work is performed under the supervision
of a licensed architect or engineer.
"(6) Routine or regular maintenance, repair,
replacement, 
reinstallation, 
or 
removal 
of
equipment, specialized technological processes, or
equipment facility systems as determined by the
1101285, 1101340
CCC has also argued that White-Spunner has implicitly
6
recognized the existence of a labor-broker exception by the
fact that it acknowledges also using temporary workers
obtained from employment agencies.  However, we note that
there is no evidence in the record indicating that those
temporary workers used by White-Spunner were engaged in
construction or supervisory activities as set forth in § 34-8-
1.
28
board 
with 
regard 
to 
scope, 
frequency, 
and
speciality of the work to be performed."
No labor-broker exemption is listed.  "Under the principle
expressio unius est exclusio alterius, the express inclusion
of 
one 
exception 
implies 
the 
exclusion 
of 
others."
Sustainable Forests, LLC v. Alabama Dep't of Revenue, 80 So.
3d 270, 273 (Ala. Civ. App. 2011) (citing Ex parte Haponski,
395 So. 2d 971, 972 (Ala. 1981)).   
6
The Supreme Court of West Virginia has considered the
issue now before us and come to a similar conclusion.  In
Personnel Temporary Services v. West Virginia Division of
Labor Contractor Licensing Board, 197 W. Va. 149, 475 S.E.2d
149 (W. Va. 1996), the Supreme Court of West Virginia heard
the appeal of Personnel Temporary Services ("PTS"), an
employment agency that had been adjudged by the trial court to
be a contractor requiring a license as a result of its
1101285, 1101340
29
providing laborers to a subcontractor tasked with demolishing
a closed restaurant.  That Court held as follows:
"The narrow issue presented by this case is
whether a business entity that refers laborers to a
properly licensed contractor for employment while
retaining all payroll functions for the laborers
referred is a contractor as defined under the West
Virginia Contractor Licensing Act, W. Va. Code
21-11-1 to -19 (1991), and therefore, subject to the
licensing requirements therein.
"Because the issue on appeal requires an
interpretation of the provisions of the West
Virginia Contractor Licensing Act, we are presented
with a purely legal question, which is subject to a
de novo review. Syllabus Point 1, Appalachian Power
Co. v. State Tax Dep't, 195 W. Va. 573, 466 S.E.2d
424 (1995).  See Hartley Marine Corp. v. Mierke, 196
W. Va. 669, 673, 474 S.E.2d 599, 603 (1996).
"The West Virginia Contractor Licensing Act
broadly defines who is considered a contractor and
therefore, 
subject 
to 
the 
Act's 
licensing
requirements.  The definition section of the Act, W.
Va. Code 21-11-3(c)(1991), provides:
"'"Contractor" means a person who in
any capacity for compensation, other than
as an employee of another, undertakes,
offers to undertake, purports to have the
capacity to undertake, or submits a bid to
construct, alter, repair, add to, subtract
from, improve, move, wreck or demolish any
building, 
highway, 
road, 
railroad,
structure or excavation associated with a
project, development or improvement, or to
do any part thereof, including the erection
of scaffolding or other structures or works
in connection therewith, where the cost of
1101285, 1101340
30
the undertaking is one thousand dollars or
more.'
"The pertinent legislative rule promulgated under
the West Virginia Contractor Licensing Act, 28
C.S.R. 2 § 3.9 (1996), is consistent with the
statutory definition of a contractor, and also adds,
in pertinent part:
"'Contractor 
or 
"contracting 
activity" 
also
means and includes the furnishing of work,
or both materials and work, for another (by
a sole contractor, general contractor,
prime contractor or subcontractor) in
fulfillment 
of 
a 
contract 
for 
the
construction, 
alteration, 
repair,
decoration or improvement of a new or
existing building or structure, or any part
thereof, or for the alteration, capital
improvement 
or 
development 
of 
real
property....  The terms "contractor" and
"contracting" are synonymous.'
"In this case, the activities of PTS fall within
the statutory definition of a contractor because PTS
supplied laborers to perform work demolishing a
building for another, the cost of which exceeded one
thousand dollars.  W. Va. Code 21-11-3(c) (1991)
provides, in pertinent part, that a '"[c]ontractor"
means a person who in any capacity ... offers to
undertake ... to ... demolish any building ...
associated 
with 
a 
project 
... 
or 
works 
in
conjunction therewith, where the cost of the
undertaking is one thousand dollars or more.'  The
legislative rule, 28 C.S.R. 2 § 3.9, provides, in
pertinent part, that a '[c]ontractor ... means and
includes the furnishing of work ... in fulfillment
of a contract for the ... alteration, capital
improvement or development of real property ....'
"Our determination of the inclusive nature of
the definition of a contractor is also shown by the
1101285, 1101340
31
nine narrow exceptions to the definition provided in
W. Va. Code 21-11-6(c)(1991).  We find none of these
narrow exceptions applies in this case because PTS
did not: (1) work for the government (see subsection
(1) of W. Va. Code 21-11-6(c)(1991)); (2) furnish a
product that is not a permanent fixed part of the
structure (see subsection (2)); (3) personally
perform agricultural work (see subsection (3)); (4)
furnish materials (see subsection (4)); (5) work as
a regulated public utility (see subsection (5)); (6)
perform emergency repair work on equipment (see
subsection (6)); (7) perform work as 'an employer's
regular 
employees' 
(see 
subsection 
(7)); 
(8)
personally perform work on property it owns (see
subsection (8)); or (9) prepare construction plans
(see subsection (9)).
"Our traditional rule of statutory construction
is stated in Syllabus Point 1 of State ex rel. Fox
v. Board of Trustees of the Policemen's Pension or
Relief Fund of the City of Bluefield, 148 W. Va.
369, 135 S.E.2d 262 (1964), overruled on other
grounds, Booth v. Sims, 193 W. Va. 323, 456 S.E.2d
167 (1995).
"'When 
a 
statute 
is 
clear 
and
unambiguous and the legislative intent is
plain the statute should not be interpreted
by the courts, and in such a case it is the
duty of the courts not to construe but to
apply the statute.'
"In accord Syl. pt. 2, Keen v. Maxey, 193 W. Va.
423, 456 S.E.2d 550 (1995); Syl. pt. 1, State ex
rel. Board of Trustees v. City of Bluefield, 153 W.
Va. 210, 168 S.E.2d 525 (1969); Syl. pt. 3, Central
West Virginia Refuse, Inc. v. Public Service Com'n
of West Virginia, 190 W. Va. 416, 438 S.E.2d 596
(1993).
"Given the clear and unambiguous language
defining 
a 
contractor 
for 
the 
West 
Virginia
1101285, 1101340
32
Contractor Licensing Act, we find that an employment
agency that refers temporary laborers for employment
to licensed contractors, who supervise the laborers
on the employment site, but retains all payroll
functions, including the wage determinations for the
temporary laborers, is a contractor under the West
Virginia Contractor Licensing Act, W. Va. Code
21-11-1 to -19 (1991), and subject to the Act's
licensing requirements.
"In this case, we find that PTS, by providing
labor to a licensed construction contractor, while
retaining all payroll functions for the laborers so
provided, is a contractor and therefore, subject to
the licensing requirements of the W. Va. Code
21-11-1 to -19 (1991)."
197 W. Va. at 151-52, 475 S.E.2d at 151-52 (footnote omitted).
We agree with the rationale of the Supreme Court of West
Virginia.  Our licensing statutes are substantially similar to
the counterparts in West Virginia and, under the plain
language of those statutes, Buena Vista was engaged in general
contracting and violated Alabama law by failing to obtain the
necessary license.  Accordingly, CCC's agreement with Buena
Vista was illegal.  As explained supra, "this Court has held
that '[a] person cannot maintain a cause of action if, in
order to establish it, he must rely in whole or in part on an
illegal or immoral act or transaction to which he is a
party.'"  Ex parte W.D.J., 785 So. 2d at 393, citing Hinkle,
242 Ala. at 378, 6 So. 2d at 421.  CCC's claims against White-
1101285, 1101340
Our resolution of this issue obviates the need to address
7
the other issues raised by White-Spunner and Hartford in their
appeal, as well as the issue raised by CCC in its cross-
appeal.
33
Spunner and Hartford are dependant upon its contract with
Buena Vista because it cannot establish a right to the money
it claims without proving that it performed the work required;
however, that same evidence establishing that the work was
performed 
–– 
sign-in 
sheets, 
invoices, 
etc. 
–– 
also
establishes that the work was performed by Buena Vista workers
pursuant to the illegal contract between CCC and Buena Vista.
The courts will not be used to assist "those who transgress
the moral or criminal code," and the summary judgment entered
in favor of CCC must accordingly be reversed.   Oden, 621 So.
7
2d at 955.
IV.
CCC sued White-Spunner and its surety, Hartford, alleging
that White-Spunner failed to pay it for labor and materials it
provided as a subcontractor to White-Spunner on the Auburn
project in the fall of 2008.  After the trial court entered a
summary judgment in favor of CCC awarding it over $1.12
million in damages and attorney fees, White-Spunner and
Hartford appealed.  We now reverse that summary judgment based
1101285, 1101340
34
on the fact that CCC's claims against White-Spunner and
Hartford stem from an illegal contract CCC entered into with
Buena Vista, an unlicensed contractor, that provided that
Buena Vista employees would complete the work CCC contracted
to perform.  The cause is therefore remanded for further
proceedings consistent with this opinion.  Our disposition of
White-Spunner 
and 
Hartford's 
appeal 
renders 
CCC's 
cross-appeal
moot; therefore, that appeal is dismissed.
1101285 –– REVERSED AND REMANDED.
Malone, C.J., and Shaw and Wise, JJ., concur.
Parker, J., concurs in the result.
1101340 –– APPEAL DISMISSED.
Malone, C.J., and Parker, Shaw, and Wise, JJ., concur.