Title: Creola Land Dev., Inc. v. Bentbrooke Housing, LLC

State: alabama

Issuer: Alabama Supreme Court

Document:

828 So. 2d 285 (2002)
CREOLA LAND DEVELOPMENT, INC.
v.
BENTBROOKE HOUSING, L.L.C., and Bentbrooke, L.L.C.
1002153.

Supreme Court of Alabama.
March 8, 2002.
*286 David P. Broome, Mobile, for appellant.
Wesley Pipes and Ryan T. Northrup, Mobile, for appellees.
WOODALL, Justice.
Creola Land Development, Inc. ("Creola"), appeals from a judgment dismissing its complaint against Bentbrooke Housing, L.L.C., and Bentbrooke, L.L.C. (hereinafter collectively referred to as "Bentbrooke"). We reverse and remand.
On January 26, 2001, Creola filed a complaint against Bentbrooke, alleging in pertinent part:
"10. On August 22, 2000, Creola's Board of Directors consisted of Stewart and Shewmake. The Board of Directors did not approve the execution of the `second mortgage' or thereafter ratify *287 the `second mortgage.' Indeed, Shewmake did not consent to and was not even aware of the `second mortgage' to Bentbrooke. Accordingly, Stewart had no actual or apparent authority to execute the `second mortgage' on behalf of Creola.
(Emphasis in original.) Creola sought a judgment declaring the mortgage void. It also sought an order enjoining Bentbrooke from foreclosing on the encumbered property and requiring Bentbrooke to cancel the mortgage.
Bentbrooke moved, pursuant to Ala. R. Civ. P. 12(b)(6), to dismiss the complaint for "failure to state a claim upon which relief can be granted." Specifically, the motion alleged: "In the present case, there is no justiciable controversy before the court as none of the rights of any of the parties to the second mortgage have been affected." The trial court granted the motion to dismiss; Creola appealed.
On appeal, Creola contends that the trial court erred in dismissing its complaint based on a lack of a justiciable controversy. Bentbrooke argues that the complaint fails to state a justiciable controversy, *288 because, it insists, "Creola has not [pleaded] any facts to the court which demonstrate that its right to lawful possession of the mortgaged property has in any way been affected." Brief of Appellee, at 6.
Bentbrooke's argument overlooks paragraphs 4, 12, and 23 of the complaint, and the standard of review to be applied to a Rule 12(b)(6) dismissal. In considering whether a complaint is sufficient to withstand a motion to dismiss, this Court must accept the allegations of the complaint as true. Ex parte Floyd, 796 So. 2d 303, 305 (Ala.2001); Callens v. Jefferson County Nursing Home, 769 So. 2d 273, 277 n. 3 (Ala.2000); Chitwood v. Carlsen, 346 So. 2d 1149, 1151 (Ala.1977); Pruitt v. Pruitt, 343 So. 2d 495, 497-98 (Ala.1977). Thus, the sole issue presented for review is whether the allegations of the complaint, taken as true, state a justiciable controversy. We hold that they do.
"All that is required for a declaratory judgment action is a bona fide justiciable controversy." Gulf South Conference v. Boyd, 369 So. 2d 553, 557 (Ala.1979). A controversy is justiciable where present "legal rights are thwarted or affected [so as] to warrant proceedings under the Declaratory Judgment statutes." Town of Warrior v. Blaylock, 275 Ala. 113, 114, 152 So. 2d 661, 662 (1963). Thus, "[d]eclaratory judgment proceedings will not lie for an `anticipated controversy.'" City of Dothan v. Eighty-Four West, Inc., 738 So. 2d 903, 908 (Ala.Civ.App.1999). "However, the parties should not be compelled to wait until the events giving rise to liability have occurred before having a determination of their rights and obligations." Id. (emphasis added); see Morton v. Allstate Ins. Co., 486 So. 2d 1263, 1269 (Ala.1986).
The complaint alleges that a cloud on the title to property owned by Creola currently exists as the result of an invalid mortgage encumbrance. The complaint further alleges that Bentbrooke, the mortgagee, has "sought to foreclose on the `second mortgage' by selling Creola's property." Accepting these allegations as true, we conclude that substantial rights of the parties are currently affected and that the complaint invokes jurisdiction under the Declaratory Judgment Act.
For these reasons, the trial court erred in dismissing Creola's complaint. The judgment of the trial court is reversed, and the cause is remanded for further proceedings consistent with this opinion.
REVERSED AND REMANDED.
MOORE, C.J., and HOUSTON, SEE, LYONS, BROWN, JOHNSTONE, HARWOOD, and STUART, JJ., concur.