Title: Ex Parte Underwriters at Lloyd's of London
Citation: 815 So. 2d 558
Docket Number: 1990822, 1990829
State: Alabama
Issuer: Alabama Supreme Court
Date: March 23, 2001

815 So. 2d 558 (2001)
Ex parte CERTAIN UNDERWRITERS AT LLOYD'S OF LONDON and Ex parte Gulf Agency, Inc., et al.
(In re Gregory Defleron and Leslie Defleron v. Gulf Agency, Inc., et al.)
1990822 and 1990829.

Supreme Court of Alabama.
March 23, 2001.
*559 E.L. McCafferty III of Vickers, Riis, Murray &amp; Curran, L.L.C., Mobile; and Paul L. Fields, Jr., of Lord, Bissell &amp; Brook, Atlanta, Georgia, for Certain Underwriters at Lloyd's of London.
James W. Garrett, Jr., and William H. Webster of Rushton, Stakely, Johnston &amp; Garrett, P.A., Montgomery, for Gulf Agency, Inc.
Thomas R. McAlpine of Whitfield &amp; McAlpine, P.C., Mobile, for respondents.
LYONS, Justice.
Gregory Defleron and his wife Leslie Defleron sued Gulf Agency, Inc., and certain underwriters at Lloyd's of London subscribing to Insurance Policy/Certificate No. HOL 00983. (Hereinafter those underwriters are referred to as "Lloyd's.")[1] The Deflerons appealed to this Court from a summary judgment entered in favor of Gulf and Lloyd's. We transferred the appeal to the Court of Civil Appeals, pursuant to § 12-2-7(6), Ala.Code 1975. The Court of Civil Appeals affirmed the judgment in part and reversed it in part, affirming "the summary judgment in favor of Gulf and Lloyd's as to all claims in the Deflerons' complaint except the fraudulent-suppression claim," as to which it reversed the summary judgment. Defleron v. Gulf Agency, Inc., 815 So. 2d 548 (Ala. Civ.App.1999). We granted Gulf and Lloyd's petitions for certiorari review. We reverse the judgment of the Court of Civil Appeals to the extent it reversed the judgment of the circuit court.
The pertinent facts and procedural history of this case are well stated in the opinion of the Court of Civil Appeals:
Defleron v. Gulf Agency, Inc., 815 So. 2d  at 549-51.
The Deflerons did not cross-petition for certiorari review of that portion of the Court of Civil Appeals' opinion affirming the summary judgment in favor of Gulf and Lloyd's as to the Deflerons' other claims alleging misrepresentation and negligent or wanton sale, procurement, or administration of an insurance policy.
The trial court determined that all of the Deflerons' claims were based upon the alleged wrongdoing of Nichols, who was purportedly acting as the agent of Gulf and Lloyd's. The trial court considered Ballard v. Lee, 671 So. 2d 1368 (Ala.1995), in which this Court, on similar facts, found no basis for imposing vicarious liability, and it determined that Ballard was dispositive of all of the Deflerons' claims, because, it determined, Nichols had not been acting on behalf of Lloyd's and Gulf.
In addition, the trial court buttressed its determinations by concluding that, under the principles stated in Montz v. Mead &amp; Charles, Inc., 557 So. 2d 1 (Ala.1987), and Currie v. Great Central Insurance Co., 374 So. 2d 1330 (Ala.1979), the Deflerons had failed to present substantial evidence indicating that the defendants had not given a notice of cancellation. Presumably, this latter conclusion, as to the Deflerons' failure to prove lack of notice, defeated the Deflerons' claim that the defendants had "intentionally or wantonly suppress[ed] a material fact, i.e., that the plaintiffs had no homeowner's insurance on their home."
The Court of Civil Appeals affirmed the summary judgment to the extent it held that Gulf and Lloyd's had no vicarious liability for the actions of Nichols, but it reversed the summary judgment insofar as it related to the Deflerons' suppression claim. The Court of Civil Appeals determined that the Deflerons had presented substantial evidence of suppression, under the standard of Ballard, wherein this Court, in addition to finding no basis for imposing vicarious liability, held that, under the circumstances of that case, an insurance company could be liable for suppression where it used policy language with a meaning generally known only to those in the insurance industry. Ballard, 671 So. 2d  at 1375.
The standard by which this Court will review a motion for summary judgment is well established:
Ex parte Alfa Mut. Gen. Ins. Co., 742 So. 2d 182, 184 (Ala.1999).
Lloyd's argues that the judgment of the Court of Civil Appeals conflicts with Baker v. State Farm General Insurance Co., 585 So. 2d 804, 808 (Ala.1991). While Lloyd's argues in its petition that the Deflerons have actually pleaded a cause of action for "fraudulent deceit," based on § 6-5-104, Ala.Code 1975, and that the Court of Civil Appeals misconstrued the claim as one of fraudulent suppression, the claim against Lloyd's can be resolved by an analysis of the relationship between Lloyd's and the Deflerons. Quite simply, there was no relationship. The Deflerons never communicated with Lloyd's, and Lloyd's never had any direct contact with the Deflerons.
Unlike Ballard, this case involves no policy of insurance that contained terms of art that reasonably could be misunderstood by the insured. Nichols tried to procure insurance for the Deflerons, which was ultimately to be underwritten by a syndicate at Lloyd's. Although Gulf initially issued a certificate of insurance on behalf of Lloyd's, no policy was forthcoming, because, when the application was more closely examined, Gulf recognized that the house did not meet the specified underwriting guidelines established by Lloyd's. The Deflerons presented no evidence and certainly not the requisite substantial evidenceindicating that Lloyd's suppressed any material fact.
It is undisputed that the underwriting guidelines were provided to Nichols and the Badger-Stonewall Agency and to Gulf. The undisputed evidence indicates that Nichols was acting as the Deflerons' agent. The only communication Lloyd's had with any party provided nothing less than full and frank disclosure. We therefore conclude that, as a matter of law, Lloyd's is not liable for fraudulent suppression. Although the trial court applied a different rationale, it reached the correct result, and the Court of Civil Appeals should have affirmed its judgment. See Ex parte Ryals, 773 So. 2d 1011, 1013 (Ala.2000); Smith v. Equifax Servs., Inc., 537 So. 2d 463, 465 (Ala.1988).
Lloyd's was entitled to the summary judgment on the fraudulent-suppression claim. The judgment of the Court of Civil Appeals is reversed insofar as it reversed the summary judgment as to that claim.
Gulf argues in its petition for the writ of certiorari that an action alleging the wrongful cancellation of an insurance policy does not sound in tort, but in contract. The seminal Alabama case addressing this topic is Hamner v. Mutual of Omaha Insurance Co., 49 Ala.App. 214, 270 So. 2d 87 (Civ.1972). In Hamner, the Court of Civil Appeals distinguished between nonfeasance, which may support an action only in contract, and misfeasance, *563 which may support an action in tort. The court wrote:
49 Ala.App. at 218, 270 So. 2d  at 90-91 (emphasis added). But see Blackburn v. Fidelity &amp; Deposit Co. of Maryland, 667 So. 2d 661, 667-68 (Ala.1995); Nat'l Sec. Fire &amp; Cas. Co. v. Bowen, 417 So. 2d 179, 183 (Ala.1982) (stating elements of a claim alleging the tort of bad-faith failure to pay an insurance claim).
More recently, in Alfa Mutual Insurance Co. v. Northington, 604 So. 2d 758 (Ala.1992), this Court stated reasons for not recognizing a tort remedy for wrongful cancellation. Those reasons suggest an affirmance of the summary judgment for Gulf on the fraudulent-suppression claim:
Alfa Mut. Ins. Co. v. Northington, 604 So. 2d  at 759-60.
In reviewing the summary judgment for Gulf, we must view the facts in a light most favorable to the Deflerons. If we accept that Gulf never mailed a notice of cancellation, a point that Gulf vehemently contests, then, at best, that fact would present a situation of nonfeasance. Accepting the Deflerons' allegations as true, we would have to conclude that the contract was never canceled, because of a failure by Gulf to give notice of cancellation. This failure would leave the Deflerons with an action in contract, not tort. The Deflerons alleged no breach of contract based upon Gulfs failure to pay their claim. The summary judgment was properly entered for Gulf on the fraudulent-suppression claim. Insofar as it reverses as to that claim, the judgment of the Court of Civil Appeals is reversed.
To the extent it reversed the summary judgment for Lloyd's and Gulf on the fraudulent-suppression claim, the judgment of the Court of Civil Appeals is reversed. The case is remanded for an order or proceedings consistent with this opinion.
REVERSED AND REMANDED.
MOORE, C.J., and HOUSTON, SEE, BROWN, HARWOOD, WOODALL, and STUART, JJ., concur.
[1]  Lloyd's is an insurance market, not a single insurance company. The market consists of a number of separate syndicates that underwrite risks on a shared, but competitive, basis. Business is brought to these syndicates by a worldwide network of brokers, working with Lloyd's brokers based in London.