Opinion ID: 2545615
Heading Depth: 1
Heading Rank: 5

Heading: Summary Judgment as to Each Project Participant

Text: Even though we have concluded that whether a breach of contract occurred and whether the statute of limitations on the fraud claims was tolled are jury questions and that therefore the trial court erred in entering the summary judgments on those grounds, we may nevertheless determine whether a summary judgment is appropriate. This Court's review is not limited to the trial court's reasoning, and we can affirm a summary judgment on any valid legal ground presented by the record, whether that ground was considered by, or even if it was rejected by, the trial court, unless due-process constraints require otherwise. Liberty Nat'l Life Ins. Co. v. University of Alabama Health Servs. Found., P.C., 881 So.2d 1013, 1020 (Ala.2003).
The City first argues that the City was not a party to the option agreements executed by the IDB and therefore was not liable for breach of contract because, it argues, the IDB was not acting as the City's agent. Under such circumstances, the City says, it is not liable under any breach-of-contract theory. We disagree. Pursuant to Resolution No. 111-2002, adopted by the City in June 2002 in conjunction with the Hyundai project, the IDB did exercise the purchase options, but assigned its rights to purchase thereunder to the City and Montgomery County (the `County'), and the City and County each have issued debt to provide the necessary funds and have acquired the Parcels. As the IDB's assignee, the City assumed the obligations and liabilities of the assigned contracts. Meighan v. Watts Constr. Co., 475 So.2d 829, 834-35 (Ala.1985). The City also argues that § 11-47-23, Ala.Code 1975, bars all claims against it. Section 11-47-23 provides: All claims against the municipality (except bonds and interest coupons and claims for damages) shall be presented to the clerk for payment within two years from the accrual of said claim or shall be barred. Claims for damages growing out of torts shall be presented within six months from the accrual thereof or shall be barred. As to the breach-of-contract claims, the City argues that the breach occurred more than two years before Wheeler/Phillips and Southdale filed their action; therefore, the City argues, those claims are barred. In so arguing, the City assumes that the cause of action for breach of contract accrued either on March 29, 2002, when the Shelton option agreement was executed, or on April 8, 2002, when the copy of the Shelton option agreement was given to Williams and McKinney, or on April 15, 2002, when the project agreement was signed, or on May 15, 2002, when Wheeler/Phillips and Southdale closed the sale of their land. We cannot accept any of the accrual dates the City assumes. In City of Mobile v. Cooks, 915 So.2d 29, 33 (Ala. 2005), we stated: A cause of action accrues under § 11-47-23 when an action can be maintained. Couch v. City of Sheffield, 708 So.2d 144 (Ala.1998); Hill v. City of Huntsville, 590 So.2d 876 (Ala.1991). This Court has stated the following with regard to when a cause of action accrues: `The very basic and long settled rule of construction of our courts is that a statute of limitations begins to run in favor of the party liable from the time the cause of action `accrues.' The cause of action `accrues' as soon as the party in whose favor it arises is entitled to maintain an action thereon. ' (Quoting Ex parte Floyd, 796 So.2d 303, 308 (Ala.2001), quoting in turn Garrett v. Raytheon Co., 368 So.2d 516, 518-19 (Ala. 1979).) It is well settled that a cause of action for breach of contract accrues when the contract is breached. Stephens v. Creel, 429 So.2d 278, 280 (Ala.1983). Here, if a jury determines that the Wheeler/Phillips and Southdale contracts were in fact breached, then the earliest such a breach could have occurred would have been August 2002, when Shelton closed on the sale of her property and was paid more than Wheeler/Phillips and Southdale had been paid for their property. Wheeler/Phillips and Southdale filed their complaint in May 2004, well within two years of the date on which their cause of action for breach of contract accrued. This Court has held that the filing of an action within the six-month period in which a tort claim must be filed was sufficient presentment of the claim to comply with § 11-47-23. Diemert v. City of Mobile, 474 So.2d 663 (Ala.1985). Likewise, the filing of the action by Wheeler/Phillips and Southdale within the two-year period in which a breach-of-contract claim must be filed was sufficient presentment of the claim to comply with § 11-47-23. The breach-of-contract claims against the City are not barred by § 11-47-23. We turn now to the tort claims. This Court has held: Some presentation of the claim within six months of its accrual is mandatory. Frazier v. City of Mobile, 577 So.2d 439 (Ala.1991). A cause of action accrues as soon as the party in whose favor it arises is entitled to maintain an action thereon. Buck v. City of Rainsville, 572 So.2d 419 (Ala.1990). In Diemert v. City of Mobile, 474 So.2d 663 (Ala.1985), we held that the filing of an action within the six-month period was sufficient presentment of the claim to comply with §§ 11-47-23 and -192, Diemert, at 666. Hill v. City of Huntsville, 590 So.2d 876, 876 (Ala.1991). In Ivory v. Fitzpatrick, 445 So.2d 262, 264 (Ala.1984), we noted that the notice-of-claim statute is not merely a statute of limitations, but is a statute of nonclaim similar to the probate nonclaim statute. Furthermore, a municipality cannot be held liable for the intentional torts of its employees. See § 11-47-190, Ala.Code 1975; Cremeens v. City of Montgomery, 779 So.2d 1190 (Ala.2000). It is undisputed that neither Southdale nor Wheeler/Phillips presented a claim to the City until they filed their complaint. This failure to file the statutorily mandated claim within six months acts as a procedural bar to all tort claims against the City. The summary judgment entered in its favor as to Southdale and Wheeler/Phillips's tort claims is due to be affirmed on this alternative ground; however, the summary judgment entered in its favor as to the breach-of-contract claim is reversed for the reasons stated in Part III of this opinion. [7]
Southdale and Wheeler/Phillips argue that the trial court erred in entering a summary judgment in Bright's favor on the basis of his State-agent immunity. Bright contends that the trial court correctly concluded that he is entitled to immunity in his individual capacity. Southdale and Wheeler/Phillips rely on Ex parte Cranman, 792 So.2d 392 (Ala. 2000), in which this Court restated the rule governing State-agent immunity. [8] The Court also stated in Cranman exceptions to that rule, i.e., when a State agent is not entitled to immunity: Notwithstanding anything to the contrary in the foregoing statement of the rule, a State agent shall not be immune from civil liability in his or her personal capacity .... (2) when the State agent acts willfully, maliciously, fraudulently, in bad faith, beyond his or her authority, or under a mistaken interpretation of the law. 792 So.2d at 405. Southdale and Wheeler/Phillips contend that Bright, in obtaining the option on the Shelton property, is not entitled to immunity because, they say, he acted willfully, maliciously, fraudulently, in bad faith, and beyond his authority. Bright testified as follows in his deposition concerning his authority to obtain the option from Shelton on behalf of the City: Q. Before you went out and met withand signed the Shelton option contract, did you get council approval to buy that property before you went out there? .... A. That morning, no. Specifically to do that transaction, not Q. Okay, A. that I recall. Q. And I did the math, and I'm rounding up here. But 93 acres at $12,000 an acre was about a 1.1 million-dollar commitment. Does that sound about right? A. If your numbers are right, yeah. Q. In order to spend 1.1 million of the City's money to buy land, would you have needed authorization from the city council? .... A. Yeah, would II could have gotten it afterwards. .... Q. But if I'm following your testimony, when you went out there that day ... to get that option, you weren't really concerned about the money because you knew somebody else was going to actually pay for it? A. Right I felt they would. Q. So would it be fair to say, then, you were getting this option either for the State or for CSX? .... A. I was getting an option. I didn't know who I was getting it for. And I was signing on behalf of the mayor. Q. But you knew you weren't getting it for the City? A. I knew I was committing the City, too, because I was putting my name as mayor on there. Q. You didn't have the authority to do that for the City, did you? A. To my knowledge, it had not gone before the city council specifically for this transaction. Now, there may be a resolution out there giving me general authority to negotiate contracts, or a statute, as part of my job as the mayor. So that may be out there that I'm not even aware about at this point. I need to do some research to determine that. Q. The day you went out there to do that, it sounds to me like you knew you weren't spending the City's money when you got that option. A. You don't know that. I didn't know that. All I know, this was critical and important to me as mayor to deliver on behalf of the City an option to tie this property down to make the deal. Bright testified that he had never seen the e-mail from Hemphill; he then testified: Q. ... [I]f you had been given this e-mail [from Hemphill], would you have changed the way you handled this? .... A. Let me answer. No. This was important for us to make this for our State, and I thought itthis was nothing significant that had any impression on meimpact on me whatsoever. We had paidor the IDB had paid the landowners double what it was worth already, and this was an llth-hour transaction to make the deal happen. Everybody has got to keep that in the focus. The foregoing testimony serves as substantial evidence that Bright was acting beyond his authority. Although Bright denied that he was aware that the option agreements on the parcels other than the Shelton property contained a most-favored-nation clause, there is substantial evidence indicating that he was aware of the clause in the other option agreements, of the consequences of triggering it, and of his participation in the effort to circumvent it. Under the circumstances, he is not entitled to immunity as a matter of law. The trial court erred in entering the summary judgment as to the claims against Bright in his individual capacity, and that judgment is due to be reversed. [9] Because Bright is no longer the mayor of the City, the claims against him in his official capacity are moot.
The May 2004 complaint alleged that the defendants named in that complaint conspired to purchase the Shelton property at a higher price than that paid to Wheeler/Phillips and Southdale in order to avoid complying with the most-favorednation clause in the option agreements for the other parcels. Strange was not named as a defendant in that complaint. The complaint does name a fictitious defendant A, described as those individuals [whether singular or plural] who made misrepresentations or participated in making misrepresentations to the plaintiffs relating to the sale or purchase of the property at issue in this case. In the second amended complaint, Wheeler/Phillips and Southdale substituted Strange and others for fictitious defendant A. Strange argues that he was named as a defendant more than two years after the statute of limitations had expired in this case and that as to him the amendment does not relate back to the original date of the pleading. The trial court's summary judgment in favor of the project participants was grounded on the expiration of the statute of limitations. In their principal briefs, Wheeler/Phillips and Southdale argue that when the statute of limitations as to fraud began to run should be a question for the jury. We have so held. However, Wheeler/Phillips and Southdale did not address Strange's relation-back argument in their principal briefs. Instead, they argue for the first time in their reply briefs that their substitution of Strange as a defendant in February 2005 was proper. Unless we can conclude that the trial court's order entering a summary judgment on the basis of the expiration of the statute of limitations does not involve its rejection of the availability of the doctrine of relation back of the second amended complaint, we cannot reach an issue omitted from Wheeler/Phillips's and Southdale's principal briefs. This Court, in Lloyd Noland Foundation, Inc. v. HealthSouth Corp., 979 So.2d 784, 797 n. 3 (Ala. 2007), stated: The Foundation's original brief to this Court addresses only the issues of res judicata and collateral estoppel. HealthSouth's brief addresses those issues, as well as the four grounds asserted in its motion to dismiss. In its reply brief, the Foundation addresses the additional grounds argued by HealthSouth. This comports with this Court's interpretation of the rules of appellate review. See Pavilion Dev., LLC v. JBJ P'ship, 979 So.2d 24 (Ala.2007) (where the trial court specifies a basis for its ruling, the appellant does not waive additional arguments not addressed in its principal brief). (Emphasis added.) Because Wheeler/Phillips and Southdale did not address the doctrine of relation back in their principal briefs, and because we cannot conclude that the availability of relation back is an additional argument separate from the specified basis for the trial court's ruling, we must affirm the summary judgment as to Strange in his individual capacity on the basis that his substitution as a defendant in the second amended complaint did not relate back to the original complaint, and, therefore, as to him, the statute of limitations had run. Because we affirm the summary judgment as to Strange on this basis, we need not address the remaining arguments as to him. As to the claims against Strange in his official capacity as the mayor of the City, the claims sounding in tort are moot for the reasons stated in Part V.A. The breach-of-contract claims are not moot, and they remain pending. To the extent Strange is a necessary party in his official capacity to effectuate any judgment in favor of Southdale and Wheeler/Phillips against the City, he remains involved.
Section 11-1-2, Ala.Code 1975, provides: Every county is a body corporate, with power to sue or be sued in any court of record. A county is not immune from suit, therefore, because it is a governmental entity. However, all claims against a county, whether in tort or in contract, must comply with the requirement of a presentment of an itemized, verified claim to the county commission. As this Court stated in Cook v. St. Clair County, 384 So.2d 1, 5 (Ala.1980): There is no restriction to the type of suit that may be brought against the countytort or contract. The only requirements that must be met regarding a suit against a county are set out in §§ 6-5-20(a), 11-12-5, 11-12-6, and 11-12-8, Code 1975 requiring presentment of an itemized, verified claim, to the county commission within twelve months of accrual, and acted on within ninety days prior to commencement of the suit. It is undisputed that neither Southdale nor Wheeler/Phillips presented a claim to the County Commission at any time. This failure to file the statutorily mandated claim acts as a procedural bar to all claims against the County and the County Commission. The summary judgment entered in their favor is due to be affirmed on this alternative ground.
Alabama law is clear that a county commissioner cannot be sued in his or her individual capacity. In Smitherman v. Marshall County Commission, 746 So.2d 1001, 1004 (Ala.1999), the Court stated: We first consider the trial court's ruling that the county commissioners and the county engineer are not amenable to suit in their individual capacities. The trial court relied on Cook v. St. Clair County, 384 So.2d 1 (Ala.1980), in which this Court held: `Counties are amenable to suit in tort under Code of Alabama, 1975, § 11-1-2. Because counties, as bodies corporate, act through their governing bodies, the county [commissions, the] commissioners likewise are subject to suit in tort, not in their individual capacities but only in their official capacities.' 384 So.2d at 7 (opinion on application for rehearing). It is therefore clear that the summary judgment was properly entered for the commissioners as to the claims against them in their individual capacities. (Footnote omitted.) We have not been asked to overrule Smitherman. Because Joseph, as a county commissioner, cannot, as a matter of law, be sued in his individual capacity, the summary judgment in his favor is due to be affirmed on this alternative ground. Because we have concluded that the County and the County Commission have no liability, the claims against Joseph in his official capacity are moot.
The Volunteer Service Act, § 6-5-336, Ala.Code 1975, provides, in pertinent part: (d) Any volunteer shall be immune from civil liability in any action on the basis of any act or omission of a volunteer resulting in damage or injury if: (1) The volunteer was acting in good faith and within the scope of such volunteer's official functions and duties for a nonprofit organization, a nonprofit corporation, hospital, or a governmental entity; and (2) The damage or injury was not caused by willful or wanton misconduct by such volunteer. When the legislature passed the Volunteer Service Act, it declared in § 6-5-336(b): (1) The willingness of volunteers to offer their services has been increasingly deterred by a perception that they put personal assets at risk in the event of tort actions seeking damages arising from their activities as volunteers; (2) The contributions of programs, activities, and services to communities is diminished and worthwhile programs, activities, and services are deterred by the unwillingness of volunteers to serve either as volunteers or as officers, directors, or trustees of nonprofit public and private organizations; (3) The provisions of this section are intended to encourage volunteers to contribute their services for the good of their communities and at the same time provide a reasonable basis for redress of claims which may arise relating to those services. It is undisputed that Thornton served as an unpaid volunteer member of the IDB. He was employed full-time in his own insurance business, and he served as the chairman of the IDB on a voluntary part-time basis. The IDB is a governmental entity as defined in the Volunteer Service Act, § 6-5-336(c)(1). See also Harris v. Ethics Comm'n, 585 So.2d 93, 95 (Ala.Civ.App.1991), in which the Court of Civil Appeals quoted with approval a statement from a trial court's order stating that industrial development boards clearly reflect attributes and characteristics of a governmental entity. Accordingly, Thornton is a volunteer under the Volunteer Service Act and is entitled to immunity so long as his actions or inactions were not wanton or willful. Thornton and the IDB had a limited role in acquiring property for Hyundai's plant site. Even though Thornton was the person who executed on behalf of the IDB the options to purchase the property owned by Southdale and Wheeler/Phillips, he never met with the landowners nor was he involved in the decisions concerning what property should be acquired or the price that should be paid for the property. Thornton had no knowledge of and was not present at the meeting held on the evening of March 28. He had no knowledge of and was not present at the meeting between then Mayor Bright and Shelton when Bright executed on behalf of the City the option to purchase Shelton's property. The IDB never held an option on or title to Shelton's property. Thornton was not involved in the actual purchase of the property. Thornton did not learn of Shelton's identity, the price paid for her property, or that Hyundai had acquired the Shelton property until many months after the fact, long after Southdale and Wheeler/Phillips had sold their property. We conclude that Southdale and Wheeler/Phillips have not presented any evidence indicating that any actions taken by Thornton, either individually or in his capacity as the chairman of the IDB, were wanton or willful. Therefore, Thornton is entitled to immunity pursuant to the Volunteer Service Act, and the summary judgment in his favor is due to be affirmed on this alternative ground.
Because we have determined that Thornton is entitled to immunity under the Volunteer Service Act, the IDB is also entitled to immunity. In Hollis v. City of Brighton, 885 So.2d 135, 141-42 (Ala.2004), the plaintiffs sued the City of Brighton, alleging that the city had failed to extinguish a fire at their house and had prevented the plaintiffs from trying to extinguish it. This Court held: The vicarious liability of a putative master under the rule of respondeat superior depends upon the liability of the putative servant. See Larry Terry Contractors, Inc. v. Bogle, 404 So.2d 613, 614 (Ala.1981) (`[W]hen [a] principal and his agent are sued in [a] joint action in tort for misfeasance or malfeasance of the servant, and his liability for the conduct of said servant is under the rule of respondeat superior, a verdict in favor of the servant entitles the master to have the verdict against him set aside.') (quoting Louisville & N.R.R. v. Maddox, 236 Ala. 594, 600, 183 So. 849, 853 (1938)), and Gore v. City of Hoover, 559 So.2d 163, 165 (Ala.1990), overruled on other grounds, Franklin v. City of Huntsville, 670 So.2d 848 (Ala.1995) (holding that a city could not be held vicariously liable for the act of a magistrate who was immune from liability). Thus, if a putative servant is not liable, either because he is innocent or because he is immune, no liability exists to be visited upon the putative master under the rule of respondeat superior. Id. .... As discussed above, the firefighters, the putative servants in the case now before us, were volunteers who did not receive compensation for their service as volunteer firefighters. Consequently, they were immune from liability for negligence under the Volunteer Service Act. Because the firefighters were immune from liability for negligence under the Volunteer Service Act, no liability for negligence could befall them to be visited upon the City [of Brighton], the putative master in the case now before us. The IDB cannot be held vicariously liable for the acts of its chairman because Thornton was immune from liability under the Volunteer Service Act. The summary judgment entered in favor of the IDB is due to be affirmed on this alternative ground.
The AIFA is a public corporation and public instrumentality of the State. See § 41-10-540, Ala.Code 1975. It was created by the legislature to fund incentives and commitments to industries that agree to locate in Alabama. By law, the governor acts as the president of the AIFA, the state treasurer as its vice president, and the finance director as its secretary. § 41-10-545, Ala.Code 1975. The AIFA argues that it is entitled to the immunity protections of Article I, § 14, Alabama Constitution of 1901, when it acts as an arm of the State. Southdale and Wheeler/Phillips argue that the AIFA is not entitled to immunity because the legislature has given it the authority to institute and defend legal proceedings. § 41-10-546(2). Nevertheless, if an action against a body such as the AIFA is in actuality an action against the State within § 14 of the Alabama Constitution, then the AIFA may be entitled to immunity. In Armory Commission of Alabama v. Staudt, 388 So.2d 991 (Ala.1980), this Court held that [w]hether a governmental body is immune from suit cannot turn on labels placed on the body by the legislature and that the legislature may not deny immunity from suit when that immunity is constitutionally granted. 388 So.2d at 992. The Court further stated: Whether a lawsuit against a body created by legislative enactment is a suit against the state depends on the character of power delegated to the body, the relation of the body to the state, and the nature of the function performed by the body. All factors in the relationship must be examined to determine whether the suit is against an arm of the state or merely against a franchisee licensed for some beneficial purpose. State Docks Commission v. Barnes, 225 Ala. 403, 406-07, 143 So. 581, 584 (1932). 388 So.2d at 993. The AIFA argues that it meets the three Staudt factors to entitle it to immunity as an arm of the State. As to the first factor, the AIFA contends that it is granted the authority to finance the State's obligations to companies that bring needed industry to Alabama. As to the second factor, the AIFA contends that it is so closely intertwined with the State that it is entitled to the immunities afforded agencies and arms of the State. As to the third factor, the AIFA states that it does not negotiate or make commitments on behalf of the State, but it is authorized to fund existing commitments through the use of AIFA obligations, primarily bonds. In Stallings & Sons, Inc. v. Alabama Building Renovation Finance Authority, 689 So.2d 790, 792 (Ala.1996), the Court stated that the Staudt test examines the complete relationship between the state and the entity seeking immunity from suit.... The Court examined the powers delegated to the Alabama Building Renovation Finance Authority by the legislature, the relationship between the Authority and the State, and the nature of the function performed by the Authority. After examining the three factors, the Court in Stallings concluded that the Authority was not immune from suit, distinguishing the facts in that case from those found in State Docks Commission v. Barnes, 225 Ala. 403, 143 So. 581 (1932), a case relied on by the Court in Staudt. The facts in this case are clearly distinguishable from those found in State Docks Commission v. Barnes , a case relied on by this Court in Staudt, in which this Court held that the State Docks Commission was an arm of the state and thus immune from suit for the following reasons: the state owned the docks facilities in its own name; the Commission operated the docks facilities as an agent of the state and not as a separate entity; the funds generated by the state docks facilities belonged to the state, and in the lawsuit at issue in that case, those funds would have been subjected to liability, because `a lawsuit directly affecting a state contract or property right is tantamount to a suit against the state.' Staudt, 388 So.2d at 993. Stallings, 689 So.2d at 793. Article I, § 14, of the Constitution of 1901, provides: [T]he State of Alabama shall never be made a defendant in any court of law or equity. This Court has held that `the use of the word State in Section 14 was intended to protect from suit only immediate and strictly governmental agencies of the State.' Tallaseehatchie Creek Watershed Conservancy Dist. v. Allred, 620 So.2d 628, 631 (Ala. 1993) (quoting Thomas v. Alabama Mun. Elec. Auth., 432 So.2d 470, 480 (Ala.1983)). After reviewing the character of the power delegated to the AIFA, the AIFA's relationship to the State, and the nature of the function it performs, we conclude that it is a State agency for purposes of State immunity. Therefore, the summary judgment entered in favor of the AIFA is due to be affirmed on this alternative ground.