Title: JT Construction, LLC v. MW Industrial Services, Inc.

State: alabama

Issuer: Alabama Supreme Court

Document:

Rel: August 20, 2021
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
SPECIAL TERM, 2021
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JT Construction, LLC
v.
MW Industrial Services, Inc.
Appeal from Walker Circuit Court
(CV-20-900278)
SHAW, Justice.
JT Construction, LLC ("JTC"), the defendant below, appeals from
the Walker Circuit Court's judgment awarding declaratory and injunctive
relief to MW Industrial Services, Inc. ("MWI"), the plaintiff in this
contract dispute.  We reverse and remand.
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Facts and Procedural History
MWI contracted with Golder Associates, Inc. ("Golder"), to provide
labor and services for a construction project at Plant Gorgas, a power
plant operated by Alabama Power Company ("Alabama Power") in Walker
County.  Southern Company Power, Inc. ("Southern Company"), is the
parent company of Alabama Power.1  Pursuant to the terms of a contract
between MWI and Golder ("the master contract"), which governs MWI's
work at Plant Gorgas, MWI was prohibited from "permit[ting] any lien,
affidavit of nonpayment, stop payment notice, attachment or other
encumbrance ... to remain on record against [Plant Gorgas] or the
property upon which it is situated for ... work performed or materials
finished in connection [there]with" by any subcontractor with whom MWI
might also contract.  
On or around April 13, 2020, pursuant to a bid proposal provided by
JTC and accepted by MWI, JTC also apparently began work at Plant
Gorgas.  JTC's bid proposal provided that 10% of the bid amount was to
1Golder, Alabama Power, and Southern Company are not parties to
the present litigation. 
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be paid to JTC by April 16, 2020, to allow JTC to purchase necessary tools
and equipment to undertake performance of its duties.  At or around that
same time, MWI presented to JTC for execution a "Project-Specific
Supplier Services Agreement" ("the subcontract agreement") regarding 
JTC's provision of certain labor and equipment to MWI in connection with
the work at Plant Gorgas.  Paragraph 15 of the subcontract agreement
("the lien-waiver provision") precluded JTC, in accordance with the master
contract, from filing a lien against property owned by Alabama Power or
Southern Company. 
Initially, JTC attempted to revise the subcontract agreement by
returning to MWI a "Red-Line" version deleting the lien-waiver provision. 
Although it asserted that it did not receive, by the agreed-upon date, the
initial promised payment equal to 10% of its bid amount, and despite its
failure to execute the subcontract agreement, JTC nonetheless continued
work at Plant Gorgas.  
After JTC had allegedly been working at Plant Gorgas for over 90
days without having received payment, MWI, according to JTC,
purportedly informed JTC that if it did not execute the original, unedited
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version of the subcontract agreement, JTC would not be paid for its
previously completed work.  JTC, allegedly in desperate need of the funds
to pay certain outstanding invoices, signed the subcontract agreement on
June 10, 2020.
Following execution of the subcontract agreement, a dispute arose
between MWI and JTC in connection with JTC's performance of its
contractual obligations and the amount owed to JTC for the work it had
performed.  In September 2020, counsel for JTC provided a "Notice of
Mechanics' Lien" indicating that JTC claimed against the real property on
which Plant Gorgas was situated a lien in the amount of $1,195,152.92
"for goods, services and materials rendered or furnished for said buildings
and improvements" in connection with JTC's work under the subcontract
agreement. 
In a subsequent written response, MWI pointed out the language of
the lien-waiver provision and demanded that JTC withdraw the lien
notice.  Thereafter, in related correspondence, JTC alleged that it had
executed the subcontract agreement only after MWI had promised to pay
certain past-due amounts to JTC upon execution of the subcontract
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agreement.  According to JTC, however, those amounts were never paid;
thus, JTC contended that it had been forced to sign the subcontract
agreement under duress to receive payment and that MWI had
fraudulently induced its execution of the subcontract agreement.  For both
of the foregoing reasons, JTC disputed that the lien-waiver provision was
enforceable.  In further correspondence, MWI asserted that JTC had been
paid for any previous work in May 2020, before its execution of the
subcontract agreement, and again demanded that JTC withdraw its notice
of lien.  
On September 24, 2020, JTC filed in the Walker Probate Court a
"Verified Statement of Mechanics' Lien" in the amount of $1,195,152.92
and a supporting affidavit.  On September 30, 2020, MWI filed a
complaint against JTC in the Walker Circuit Court seeking both
declaratory and injunctive relief.  Specifically, MWI requested, pursuant
to Rule 65, Ala. R. Civ. P., a temporary restraining order and a
preliminary injunction prohibiting JTC from filing a lien on the Plant
Gorgas property and further requiring the withdrawal of the previously
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filed lien.  MWI also sought a declaratory judgment "giving full force and
effect to" the subcontract agreement.   
MWI's complaint was accompanied by supporting exhibits, including
the affidavit of its counsel of record and supporting documentation
demonstrating both MWI's unsuccessful demands that JTC withdraw the
lien notice and the alleged potential for immediate and irreparable
financial harm to MWI if the lien was not withdrawn.  Also included was
an affidavit from an MWI officer addressing JTC's contention that it had
signed the subcontract agreement under duress and specifically averring
that the subcontract agreement had to comport with MWI's own
contractual obligations under the master contract; that MWI thus could
never have consented to the striking of the lien-waiver provision; that, at
the time the subcontract agreement was executed, JTC had issued to MWI
invoices totaling $193,887.50 despite the lack of a formal contract between
the parties; that certain invoices submitted by JTC had been rejected on
the grounds that they were erroneous or  insufficiently detailed; and that
the "approved" invoices had totaled $145,366.04 and MWI had issued
payment in the amount of $139,320, leaving a balance of $6,046.04 as of
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June 10, 2020, the date JTC signed the subcontract agreement.  A copy of
the check issued to JTC by MWI on May 29, 2020, in the amount of
$139,320, and reflecting JTC's subsequent deposit on June 2, 2020, was
also included. 
On the date MWI's action was commenced, the trial court issued the
requested temporary restraining order requiring JTC to withdraw its lien. 
In that same order, the trial court also indicated that on October 7, 2020,
it would hold "a hearing on the preliminary injunction in this cause,
pursuant to Rule 65 ...,  as prayed for in [MWI's] complaint."  
 
The record suggests that JTC did not file any response to MWI's
complaint before the scheduled hearing date, but it did appear at the
hearing.   JTC was not served with MWI's complaint until October 9,
2020, after the hearing took place.
The transcript of the October 7, 2020, hearing reflects that, at its
beginning, the trial court announced:  "[W]e're here today for hearing on
[MWI's] complaint for declaratory judgment and injunctive relief of
preliminary and permanent.  At least preliminary.  I'm not sure about the
permanent.  We'll see where we go with that."  At that time, when
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questioned by the trial court as to what "[they] need[ed] to accomplish
here today," MWI's counsel replied:  "Basically we're looking to get a
preliminary injunction today."  Shortly thereafter, following a summary
of MWI's position, its counsel reiterated that "[MWI's] intent [was] to get
a preliminary injunction ...." 
Later, when counsel for the parties engaged in argument as to
whether the "irreparable financial injury" alleged by MWI was sufficient
to justify injunctive relief, MWI identified authority allegedly supporting
its claims.  At that time, the trial court asked JTC's counsel whether he
had "had time to look at [the authority]" and received a negative response.
The trial court then announced:
"Why don't we proceed on and hear whatever we need to
hear, and then I would imagine I'll take the matter under
advisement.  And I'll give each of you an opportunity to
submit, and you can respond to this and argue, as to why
they're not entitled to an injunction and so forth.  But let's go
ahead and proceed on to take whatever testimony y'all are
prepared to offer today, if any, and we'll go from there."
(Emphasis added.)
During MWI's subsequent attempt to admit documentary evidence,
including copies of the master contract and subcontract agreement, the
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following exchange occurred between counsel for MWI and counsel for
JTC:
"[MWI's counsel]:  I'm sorry I'm not showing these
[exhibits] to you, but you've seen them, I'm sure.
"[JTC's counsel]:  I haven't."
Thereafter, MWI offered testimony to confirm the details surrounding the
execution of the subcontract agreement, including that the signed
subcontract agreement was in effect at the time that JTC filed its verified
statement of lien, and regarding the payments allegedly made by MWI to
JTC or on JTC's behalf.  
After MWI rested, JTC presented testimony from Tim Kittrell, its
vice president, who outlined JTC's invoicing process for the Plant Gorgas
project and the amounts JTC claimed it was owed under the subcontract
agreement.  In response to a letter that JTC's counsel offered into
evidence, MWI's counsel pointed out that "attachments" referenced in the
letter did not appear to be appended to the proffered copy.  JTC's counsel
indicated that he did not have the attachments at the hearing.
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 Regarding the allegedly outstanding invoices, which were
specifically labeled as having been rejected by MWI for lack of supporting
detail, Kittrell testified that, despite that label, they were subsequently
"adjusted" and later approved.  When asked by MWI's counsel whether he
possessed proof of that alleged approval, Kittrell responded: "I know we
have it.  It might not be here today, but we do have that,"  and further
maintained that JTC possessed "documentation to support [the disputed]
invoices." 
Also during Kittrell's testimony, the trial court interrupted to
inquire as follows:
"THE COURT:  Can I interrupt just a minute. ...  I'm
sorry to do this, but let me ask this.  Aren't we getting pretty
much beyond -- what am I missing here?  I understand the
relief [MWI is] asking for, which is the injunction to enjoin
[JTC from] filing a lien and for declaratory judgment giving
full force and effect to the agreement, but now, can I not give
full force and effect to that and [JTC] still have [the] right to
file some sort of -- I guess it would be a lawsuit, breach of
contract?
"[MWI's counsel]:  Absolutely.
"THE COURT:  Well, then, why are we --
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"[MWI's counsel]:  That's what we've told them.  They
can sue us.
"THE COURT:  I'm satisfied, I'm satisfied that you're
entitled to the relief you've asked for.  But I'm certainly not
prepared to preclude [JTC] from [its] right to proceed on a
breach of contract claim, or however [it] wants to proceed, to
claim that [it's] due some more money from [MWI].
"[MWI's counsel]:  We agree, Your Honor, totally.
"THE COURT:  ... So who else do you want to put on? 
I'm satisfied that the contract is due to be enforced, okay? And
so is there something else that you all would offer to show me
why it shouldn't be enforced?
"[JTC's counsel]:  Yes, we have further evidence ... to go
towards the duress argument."
At the conclusion of its evidentiary submission, JTC objected to
granting an injunction and renewed its earlier argument that the financial
harm alleged by MWI "is not sufficient for preliminary injunction."  The
trial court overruled JTC's objection and stated on the record its intent "to
grant [MWI] the relief requested." 
Following a discussion between the trial court and MWI's counsel
regarding the proper way to "enjoin" the existing lien, the trial court's
request that MWI present a proposed order "one day next week," and the
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trial court's related instruction to JTC's counsel that "if [JTC has] some
problem with the way it's proposed, [to] let [the trial court] know," the
hearing concluded upon the following additional exchange between the
trial court and MWI's counsel:
"[MWI's counsel]:  Thank you,  Your Honor.  Is that
granting the preliminary injunction or granting just the total
injunction that no liens can be filed under [the agreement]?
"THE COURT:  Yeah, that's what I'm -- yes, I'm ordering
you the relief you requested, without precluding [JTC] from
taking further action to recover what [it says it is] due under
the agreement."
As mentioned above, on October 9, 2020, two days after the hearing, JTC
was served with MWI's complaint.
On October 15, 2020, the trial court entered an order issuing a
permanent injunction and ruling in favor of MWI on its declaratory-
judgment claim, providing as follows:
"The Court, having considered [MWI's]  Complaint ... and all
of the testimony and evidence presented by the parties, finds
that [MWI's] prayer for relief requesting that the [subcontract]
Agreement be declared valid and enforceable and that [JTC] 
should be permanently enjoined, both in the past and in the
future, from placing any mechanic's liens on the land, building,
and/or improvements on the property ... at Plant Gorgas ... is
due to be granted."
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The trial court also awarded MWI attorneys' fees.
The following day, JTC filed in the trial court an "Answer,
Counterclaim, & Motion to Transfer Venue."  In addition to generally
denying MWI's entitlement to the requested relief, JTC asserted
numerous defenses to MWI's claims and a 10-count "compulsory
counterclaim" against MWI seeking damages for, among other things,
breach of contract based on MWI's purported failure to pay JTC's
outstanding invoices for work performed pursuant to the subcontract
agreement.  JTC further demanded "trial by struck jury on all matters
raised" and moved, pursuant to Rule 12(b)(3), Ala. R. Civ. P., to transfer
the action to either the Jefferson Circuit Court or the Shelby Circuit Court
in accordance with a choice-of-venue provision in the master contract.
Also on October 16, 2020, JTC filed a "Motion to Reconsider and
Motion to Stay" in which it argued, among other things, that the trial
court had erred in entering a "final determination on the merits" pursuant
to "an un-noticed bench trial" conducted at the time of the hearing
scheduled for review of MWI's preliminary-injunction request.  According
to JTC, the trial court's actions deprived it of due process because, at the
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time of the hearing, it had not yet been formally served with MWI's
complaint, it had been unprepared to "take and present testimony" for
trial (as opposed to responding to MWI's pending request for a preliminary
injunction) without the benefit of discovery, and it had not yet filed an
answer (which, because it had not yet been served, it was not yet obligated
to file and in which it ultimately asserted defenses to MWI's injunctive
and declaratory-judgment claims, its own compulsory counterclaim, and
a jury demand).  In addition, JTC argued that, even if the trial court had
given notice that the October 7, 2020, hearing would be a trial on the
merits, the seven days between the issuance of the trial court's order
setting that hearing and the hearing date would nonetheless have failed
to provide "sufficient time under the Alabama Rules of Civil Procedure to
conduct discovery or subpoena witnesses." 
While its postjudgment motion remained pending, JTC filed a notice
of appeal to this Court, which we held in abeyance until the trial court, by
an order entered on November 7, 2020, denied JTC's postjudgment
motion.  See Rule 4(a)(5), Ala. R. App. P.
Standard of Review
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Because the determinative issue on appeal concerns a question of
law related to the trial court's entry of permanent injunctive relief, we
review that judgment de novo.  Holiday Isle, LLC v. Adkins, 12 So. 3d
1173, 1176 (Ala. 2008).  
Discussion
On appeal, JTC raises various challenges to the trial court's
judgment.  Specifically, among claims challenging both procedural and
substantive aspects of that judgment, JTC alleges that the trial court
deprived JTC of due process and the right to a jury trial by prematurely
proceeding to a final hearing on the merits of the action -- including
whether to grant permanent injunctive relief -- without providing JTC
with either notice or the opportunity to prepare a defense to MWI's claims. 
We agree.2 
Rule 65(a), Ala. R. Civ. P., provides:
"(1) Notice.  No preliminary injunction shall be issued
without notice to the adverse party.
2Because of the dispositive nature of this issue, we pretermit
discussion of the remaining issues JTC raises on appeal.
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"(2) Consolidation of Hearing With Trial on Merits. 
Before or after the commencement of the hearing of an
application for a preliminary injunction, the court may order
the trial of the action on the merits to be advanced and
consolidated with the hearing of the application.  Even when
this consolidation is not ordered, any evidence received upon
an application for a preliminary injunction which would be
admissible upon the trial on the merits becomes part of the
record on the trial and need not be repeated upon the trial. 
This subdivision (a)(2) shall be so construed and applied as to
save to the parties any rights they may have to trial by jury."
(Emphasis added.)
In Martin v. Patterson, 975 So. 2d 984, 990-91 (Ala. Civ. App. 2007),
the Court of Civil Appeals considered a similar claim that the defendants
had not received "proper notice that a hearing on the merits of a
permanent injunction would be held, as opposed to a hearing on the
propriety of a preliminary injunction," stating:
"In Woodward [v. Roberson, 789 So. 2d 853 (Ala. 2001)], our
supreme court noted:
"'It is appropriate for the trial court, either before
or after the commencement of the hearing on an
application for a preliminary injunction, to order
that the trial of the action on the merits be
consolidated with that hearing.  Rule 65(a)(2), Ala.
R. Civ. P.  However, such a consolidation must
conform to the rights of the litigants to reasonable
notice.  Pughsley v. 3750 Lake Shore Drive Coop.
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Bldg., 463 F.2d 1055 (7th Cir. (Ill.) 1972) (per then
Circuit Judge John Paul Stevens).'
"Woodward, 789 So. 2d at 855.  Pughsley v. 3750 Lake Shore
Drive Coop. Bldg., 463 F.2d 1055 (7th Cir. 1972), which is cited
in Woodward, also stated that 'the parties should be given a
clear opportunity to object, or to suggest special procedures, if
a consolidation is to be ordered.'  463 F.2d at 1057.
"In determining that the trial court had entered a
preliminary injunction and not a permanent injunction in
Woodward, our supreme court distinguished the facts in that
case from those in TFT[, Inc. v. Warning Systems, Inc., 751 So.
2d 1238, 1242 (Ala. 1999), overruled on other grounds by
Holiday Isle, LLC v. Adkins, 12 So. 3d 1173, 1176 (Ala. 2008),]
by observing that 'the parties in TFT agreed to the
consolidation of the hearing on the preliminary-injunction
request with a hearing on the merits.'  789 So. 2d at 855 (citing
TFT, 751 So. 2d at 1241-42).  In regard to that agreement our
supreme court noted in TFT that 'the trial court asked the
parties during the hearing, "Are we going to combine this
hearing with any subsequent hearing, for the record?" and to
that question counsel for each of the parties responded, "Yes,
sir."'  751 So. 2d at 1242.  Although at the conclusion of the
second hearing in this case the parties agreed to 'submit it' for
the trial court's consideration, such an agreement is not
similar to the agreement in TFT.  In fact, the agreement to
submit the issue for the trial court's determination in this case
is similar to dialogue between the trial court and the attorneys
in Pughsley, supra.  In that case the trial court stated:
"'"Now I am going to insist, counsel,
that whatever your total case is, and I
want to give you every reasonable
opportunity to put it in, that you
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complete it before I request the
defendants to go ahead.
"'"Now, can you produce your witness
tomorrow...."'
"463 F.2d at 1056.  In determining that the trial court's
statement in Pughsley did not meet the notice requirement
under Rule 65(a)(2), Fed. R. Civ. P., the United States Court
of Appeals for the Seventh Circuit stated that the '[p]laintiffs'
counsel could reasonably have understood the judge as merely
requiring a presentation on the following day of the remainder
of plaintiffs' "total case" in support of their pending motion.
That was the only hearing then in progress.'  Id. at 1057. 
Similarly, within the context of the overall trial-court
proceedings in this case, it is apparent that the parties
intended to submit the question whether the preliminary
injunction should be entered for the trial court's consideration 
-- they did not agree to submit the question whether a
permanent injunction should be entered.  However, our
analysis does not end with that determination, because:
"'A party contesting the entry of final judgment at
the preliminary injunction stage, however, must
demonstrate prejudice as well as surprise.  The
action may be remanded to the trial court for a
determination of whether prejudice has resulted. 
On the other hand, if it is clear that consolidation
did not detrimentally affect the litigants, as, for
example, when the parties in fact presented their
entire cases and no evidence of significance would
be forthcoming at trial, then the trial court's
consolidation will not be considered to have been
improper.'
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"11A Charles Allan Wright et al., Federal Practice and
Procedure: Civil § 2950 (2d ed. 1995) (footnotes omitted); see
also Rule 45, Ala. R. App. P. (providing that '[n]o judgment
may be reversed or set aside, nor new trial granted in any ...
case ... for error as to any matter of ... procedure, unless ...
after an examination of the entire cause, it should appear that
the error complained of has probably injuriously affected
substantial rights of the parties')."
975 So. 2d at 991-92 (footnote omitted).
A.  Notice
In the present case, the record reflects, as JTC notes, that the trial
court specifically noticed the October 7, 2020, hearing as "a hearing on the
preliminary injunction in this cause, pursuant to Rule 65" -- not as a
bench trial on the merits of MWI's claims.  Further, the transcript, as
quoted above, suggests that, consistent with the trial court's order and
contrary to the terms of the judgment ultimately entered, the trial court
and MWI suggested on the record that only the issue of preliminary
injunctive relief was at issue at the October 7, 2020, proceeding.  In fact,
it was not until the conclusion of the hearing that there was arguably an
indication by the trial court that it was considering granting anything
other than preliminary injunctive relief.  Indeed, our review of the record
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indicates that apparently neither party appeared certain as to the relief
being contemplated by the trial court either during or at the conclusion of
the proceeding below. 
To the extent that the trial court's ultimate comments at the close
of the hearing might have suggested to JTC that the trial court was also
considering granting permanent injunctive relief -- as Rule 65(a)(2) clearly
contemplates -- such notice at that late stage of the proceeding cannot be
deemed adequate in this case, in which JTC was not prepared for a trial
on the merits and in which  final relief was awarded before JTC had been
served with MWI's complaint and before its answer was due.  See Rule
12(a), Ala. R. Civ. P.  ("A defendant shall serve an answer within thirty
(30) days after the service of the summons and complaint upon that
defendant ...."), and Rule 38(b), Ala. R. Civ. P. ("Any party may demand
a trial by jury of any issue triable of right by a jury by serving upon the
other parties a demand therefor in writing at any time after the
commencement of the action and not later than thirty (30) days after the
service of the last pleading directed to such issue.").  Moreover, the record
clearly reflects the parties' ongoing dispute -- and widely disparate
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positions -- regarding any amounts owed to JTC under the subcontract
agreement, which dispute ultimately formed the basis of JTC's
counterclaims.  Under the present circumstances, JTC received
inadequate notice of the consolidation of the preliminary-injunction
hearing with a final hearing on the merits.  Cf.  Funliner of Alabama,
L.L.C. v. Pickard, 873 So. 2d 198, 219 (Ala. 2003) ("Notice to the adverse
party before a preliminary injunction is issued is mandatory, pursuant to
Rule 65(a), Ala. R. Civ. P. The defendants had no indication that the
request for a preliminary injunction was to be heard at the
class-certification hearing, that the defendants needed to address the
preliminary injunction at that time, or that the request had been set for
a hearing. An adverse party must have notice and a hearing in order to
adequately oppose a request for a preliminary injunction.").  
B.  Prejudice
As explained in Martin, however, our inquiry does not conclude with
our finding of insufficient notice; instead, we must further consider
whether JTC was prejudiced by that "surprise" consolidation.  975 So. 2d
at 991. 
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"[The Court of Civil Appeals] held in Martin that a party
objecting to the consolidation of a hearing on a preliminary
injunction with a final trial on the merits under Rule 65(a)(2),
Ala. R. Civ. P., must not only demonstrate surprise that the
hearing was consolidated with a trial on the merits but also
demonstrate that the consolidation resulted in prejudice to
that party. Martin, 975 So.2d at 991-92. To demonstrate such
prejudice, [that court] explained, would require some proof
that the party had lacked the opportunity to present its entire
case or that the party had 'additional "evidence of significance"
that "would be forthcoming at trial."' Id. at 992 (quoting 11A
Charles Alan Wright et al., Federal Practice and Procedure:
Civil § 2950 (2d ed. 1995) ('Wright & Miller')); see also Atlantic
Richfield Co. v. F.T.C., 546 F.2d 646, 651 (5th Cir.1977)
(declining to find error in a Rule 65(a)(2), Fed. R. Civ. P.,
consolidation -- i.e., consolidating a hearing on a preliminary
injunction with a final trial on the merits -- because the
complaining party failed to show prejudice resulting from the
lack of notice of the consolidation).  Furthermore, to establish
the required element of prejudice, specific allegations
regarding the evidence that allegedly was not or could not
have been presented must be made by a party objecting to the
consolidation of any of the hearings that might be held under
Rule 65.  See Roberts v. Community Hosps. of Indiana, Inc.,
897 N.E.2d 458, 466 (Ind. 2008) ('[T]he prevailing federal rule
is that allegations of prejudice must be specific.')."
Jacobs Broad. Grp., Inc. v. Jeff Beck Broad. Grp., LLC, 160 So. 3d 345,
351-52 (Ala. Civ. App. 2014).
MWI argues that JTC suffered no prejudice from the consolidation
of the preliminary-injunction hearing with the final trial on the merits of 
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MWI's claims.  JTC, however, contends that the trial court's precipitous
actions deprived it of the right to a jury trial.  We agree.
It is apparent that, despite the lack of formal service of the
complaint in this case, JTC did receive some type of notice of the
scheduled hearing on MWI's request for a preliminary injunction.  That
notice allowed JTC to appear at the scheduled preliminary-injunction
hearing with legal counsel and to offer evidence in opposition to MWI's
request for preliminary injunctive relief.  Nonetheless, as demonstrated
by the excerpts from the hearing quoted above, JTC was not fully
prepared to address the merits of MWI's claims because it had not been
provided, or it had lacked sufficient opportunity to locate and review, all
the documentary evidence and applicable legal authority relied on by
MWI.  In fact, JTC had not been served with the complaint, and no
discovery had occurred.  
Further, despite multiple representations by the trial court that,
following the hearing, JTC would be afforded additional opportunities
both to engage in follow-up briefing of certain issues and to attend future
proceedings, for all that appears those representations were later negated
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by the trial court's immediate decisions to award MWI permanent
injunctive relief3 and to rule in favor of MWI on its declaratory-judgment
claim. 
Clearly, JTC had the opportunity to present testimony in defense to
MWI's request for a preliminary injunction, which requires a different
evidentiary standard than that applicable to a request for a permanent
injunction.  See D.M.C. Enters., Inc. v. Hope, 100 So. 3d 1102, 1109 (Ala.
Civ. App. 2012) ("[A]s opposed to a preliminary injunction, which requires
a showing of a likelihood of success on the merits of the litigation, a
permanent injunction requires proof of success on the merits of the
litigation.").  Further, a final disposition so near in time to the filing of
MWI's complaint and before the parties had engaged in any discovery
3Based on the record, the vagueness of the trial court's
representations regarding the precise nature of the relief that the court
was considering -- as well as the ostensible opportunity for further
submissions -- explains JTC's failure to object  during the proceeding.  See
Martin, 975 So. 2d at 991 ("Pughsley v. 3750 Lake Shore Drive Coop.
Bldg., 463 F.2d 1055 (7th Cir. 1972), which is cited in Woodward[v.
Roberson, 789 So. 2d 853 (Ala. 2001)], also stated that 'the parties should
be given a clear opportunity to object, or to suggest special procedures, if
a consolidation is to be ordered.' 463 F.2d at 1057."  (emphasis added)).
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gave JTC no opportunity to obtain or identify material evidence.  More
importantly, as indicated by its subsequent answer, JTC timely demanded
a jury trial.  The trial court's premature consolidation and decision on the
merits, however, deprived JTC of that right in contravention of Rule
65(a)(2), which permits consolidation but "save[s] the parties['] ... rights
... to trial by jury."  We conclude that JTC sufficiently demonstrated
prejudice.  
Conclusion
Based on the foregoing, we hold that the trial court erred in issuing
the declaratory judgment and in awarding permanent injunctive relief
without prior notice to JTC, as required by Rule 65(a)(2), and that JTC
was prejudiced by that error.  The trial court's judgment is therefore
reversed, and this case is remanded for further proceedings consistent
with this opinion.
REVERSED AND REMANDED.
Parker, C.J., and Bryan, Mendheim, and Mitchell, JJ., concur.
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