Opinion ID: 1642750
Heading Depth: 1
Heading Rank: 8

Heading: The Summary Judgment for Landmark

Text: The trial court supported the summary judgment for Landmark on the alternate grounds that the plaintiffs' negligence and breach-of-warranty claims were subsumed in their AEMLD claims and that Landmark had provided the plaintiffs no express warranty. With respect to the trial court's determination that the plaintiffs' negligence and breach-of-warranty claims were subsumed by their AEMLD claims, the trial court's determination might have been supportable under Veal v. Teleflex, Inc., 586 So.2d 188 (Ala.1991), a case that discussed circumstances under which the strict-liability doctrine of the AEMLD might be viewed as imputing negligence to a defendant as a matter of law. [6] More recently, however, and after the entry of the summary judgment for Landmark, this Court specifically addressed the question whether a negligence claim is subsumed in a AEMLD claim in Tillman v. R.J. Reynolds Tobacco Co., 871 So.2d 28, 34-35 (Ala.2003): It must be remembered, however, that the AEMLD, as established in Casrell [v. Altec Industries, Inc., 335 So.2d 128 (Ala.1976),] and Atkins [v. American Motors, Corp., 335 So.2d 134 (Ala.1976),] is and example of judicial legislation,' not of legislative enactment. Keck v. Dryvit Sys., Inc., 830 So.2d 1, 8 (Ala.2002). This Court warned last year in Keck that `[j]udicial decision-making should not be seen as the opportunity to legislate.' 830 So.2d at 8. Alabama remains a common-law state, and therefore common-law tort actions `so far as [they are] not inconsistent with the Constitution, laws and institutions of this state ... shall continue in force, except as from time to time ... may be altered or repealed by the Legislature.' § 1-3-1, Ala.Code 1975. We will not presume to so define the boundaries of the judicially created AEMLD so that it subsumes the common-law tort actions of negligence and wantonness against the retailer defendants. See also Spain v. Brown & Williamson Tobacco Corp., 872 So.2d 101, 111 (Ala.2003)(discussing at some length the distinction between a breach-of-warranty claim under the Uniform Commercial Code and a claim under the AEMLD, and stating that a claim alleging breach of an implied warranty of merchantability is separate and distinct from an AEMLD claim and is viable to redress an injury caused by an unreasonably dangerous product). In addition, Vesta and Wausau assert that at this stage of the litigation they are proceeding with their negligence and breach-of-warranty claims in the alternative to their AEMLD claims, as they are permitted to do under Rule 8(e)(2), Ala.R.Civ.P. That rule provides, in pertinent part: A party may set forth two or more statements of a claim or defense alternatively or hypothetically, either in one count or defense or in separate counts or defenses. When two or more statements are made in the alternative and one of them if made independently would be sufficient, the pleading is not made insufficient by the insufficiency of one or more of the alternative statements. A party may also state as many separate claims or defenses as the party has regardless of consistency and whether based on legal or on equitable grounds, or on both. Thus, Vesta and Wausau are permitted to plead negligence and breach-of-warranty claims to the extent that they claim that Landmark provided deficient construction or installation services and they can present AEMLD claims with respect to a claim that Landmark provided a defective product. For example, in the case of Keck v. Dryvit Systems, Inc., 830 So.2d 1 (Ala.2002), this Court discussed the test for determining whether an item incorporated into real property, such as the HVAC in this case, may be considered a product for purposes of the AEMLD. That test involves determining whether the item is a part of the structural integrity of the building that is expected to last for the life of the building, so that it is not a product, or whether the nature of the item is such that one would reasonably expect to repair or to replace it, so that it is a product. In the case of the HVAC mounted on the roof of a building, it is certainly conceivable that the plaintiffs could show claims based on negligence in the installation of the HVAC as distinct from a claim that the HVAC or a portion of it was an unreasonably dangerous product under the AEMLD. In fact, Wausau concedes in its briefs to this Court that if it is determined that the construction of the building does not involve a product, then its AEMLD claim should be dismissed. We therefore conclude that the plaintiffs' negligence claims and breach-of-warranty claims were not subsumed by their AEMLD claims and that this rationale is not a proper basis for supporting a summary judgment for Landmark as to those claims. With respect to the trial court's determination that Landmark had provided no express warranty, the plaintiffs rely on paragraph 4.5.1 of the Standard Form of Agreement Between Contractor and Subcontractor executed between Milam as the general contractor and Landmark as a subcontractor. That contract also refers to A & M as the owner of the building housing the video rental store and states: The Subcontractor warrants to the Owner, Architect, and Contractor that materials and equipment furnished under this Subcontract will be of good quality and new unless otherwise required or permitted by the Subcontract Documents, that the work of this Subcontract will be free from defects not inherent in the quality required or permitted, and that the work will conform with the requirements of the Subcontract documents. Work not conforming to these requirements, including substitutions not properly approved and authorized, may be considered defective. The Subcontractor's warranty excludes remedy for damage or defect caused by abuse, modifications not executed by the Subcontractor, improper or insufficient maintenance, improper operation, or normal wear and tear under normal usage. This warranty Shall be in addition to and not in limitation of any other warranty or remedy required by law or by the Subcontract Documents. Vesta, as the subrogee of the owner, A & M, asserts that this provision constitutes an express warranty that inured to its benefit. Further, both Vesta and Wausau assert that paragraph 4.5.1 is an express warranty for their benefit because they are third-party beneficiaries to the contract. Alabama law is well settled that parties who are directly benefited by a contract that does not expressly name them may have a cause of action under the provisions of that contract. Alabama law is clear to the effect that one for whose benefit a valid contract has been made, although that person is not a party thereto and does not furnish any consideration therefor, may maintain an action on the contract against the promissor. Anderson v. Howard Hall Company, 278 Ala. 491, 179 So.2d 71 (1965); Mutual Benefit Health & Accident Association of Omaha v. Bullard, 270 Ala. 558, 120 So.2d 714 (1960); Tennessee Coal, Iron & Railroad Co. v. Sizemore, 258 Ala. 344, 62 So.2d 459 (1952); Employers Ins. Co. of Alabama v. Rhodes, 240 Ala. 226, 198 So. 616 (1940); Employers Ins. Co. of Alabama v. Johnston, 238 Ala. 26, 189 So. 58 (1939); Barlowe v. Employers Ins. Co. of Alabama, 237 Ala. 665, 188 So. 896 (1939). The only condition being that the third person must have been intended to be directly and not incidentally benefited. Anderson v. Howard Hall Company, supra; Brown v. Fogarty, 221 Ala. 283, 128 So. 376 (1930). Harris v. Board of Water & Sewer Comm'rs of City of Mobile, 294 Ala. 606, 611, 320 So.2d 624, 628 (1975). Although we note that Vesta is plainly subrogated to A & M's interest, Wausau is subrogated to the rights of Hollywood, the occupant of the building. There is certainly a genuine issue of material fact as to whether the occupant would be a third-party beneficiary of the construction contract and of paragraph 4.5.1. under Harris. The law of subrogation is clear that Wausau acquires the same legal status Hollywood might have. American Liberty Ins. Co. v. Am-South Bank, 825 So.2d 786 (Ala.2002); International Underwriters/Brokers, Inc. v. Liao, 548 So.2d 163 (Ala.1989). Thus, to the extent that there is a question of fact concerning Hollywood's right to protection under paragraph 4.5.1. as a third-party beneficiary, Wausau has that same right. Moreover, we have held that the application of an express warranty is a question of fact for the trier of fact. Ex parte Miller, 693 So.2d 1372 (Ala.1997); Fleming Farms v. Dixie Ag Supply, Inc., 631 So.2d 922 (Ala.1994). Under the circumstances of this case, we conclude that a genuine issue of material fact exists concerning whether Landmark made an express warranty which inures to the benefit the plaintiffs. Hobson, supra. Accordingly, the trial court's summary judgment for Landmark must also be reversed as to this issue.