Court Opinion

ID: 9917412
Source: CourtListenerOpinion
Date Created: 2024-01-12 15:01:47.139571+00
Date Added: 2024-06-11T08:02:38.780962
License: Public Domain

Rel: January 12, 2024

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) 229-0650), 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
                             OCTOBER TERM, 2023-2024

                                _________________________

                                      SC-2023-0397
                                _________________________

     Construction Services, LLC, d/b/a MCA Construction, Inc.

                                                  v.

RAM-Robertsdale Subdivision Partners, LLC, Retail Specialists,
                LLC, and Rodney Barstein

                        Appeal from Baldwin Circuit Court
                                  (CV-22-900285)

MITCHELL, Justice.

        RAM-Robertsdale Subdivision Partners, LLC, hired Construction

Services LLC, d/b/a MCA Construction, Inc. ("MCA"), to build the
SC-2023-0397

infrastructure for a proposed housing subdivision in Robertsdale. After

the relationship between the two soured, RAM-Robertsdale sued MCA in

the Baldwin Circuit Court. MCA countersued and also asserted third-

party claims against one of RAM-Robertsdale's members, Retail

Specialists, LLC, and Rodney Barstein, a corporate officer for Retail

Specialists and RAM-Robertsdale. 1 RAM-Robertsdale, Retail Specialists,

and Barstein ("the RAM defendants") filed a motion for summary

judgment on MCA's counterclaims and third-party claims, and the circuit

court granted that motion and later certified its summary judgment as

final under Rule 54(b), Ala. R. Civ. P. Because the circuit court exceeded

its discretion in certifying its judgment as final, we set aside the Rule

54(b) certification and dismiss the appeal.

                     Facts and Procedural History

     In February 2021, MCA entered into an approximately $1 million

contract with RAM-Robertsdale to work on, among other things, grading,

     1MCA    styled all of its claims as "counterclaims" and referred to
those parties it brought claims against as "counterclaim defendants."
The circuit court and the other parties followed this nomenclature, even
though Retail Specialists and Barstein were "not [parties] to the action"
before MCA filed its answer and counterclaim. Retail Specialists and
Barstein are therefore properly viewed as third-party defendants. See
Rule 14, Ala. R. Civ. P.
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roads, and utilities for a new housing subdivision in Robertsdale. Over

the next several months, the parties' relationship broke down and MCA

eventually ceased work on the project.

     RAM-Robertsdale sued MCA for breach of statutory duty, breach of

contract, indemnity, negligence, and negligent misrepresentation, and to

quiet title, alleging that MCA had done subpar work and had not paid its

subcontractors or suppliers. MCA answered and asserted counterclaims

against RAM-Robertsdale. MCA also brought third-party claims against

Retail Specialists and Barstein for breach of contract, fraud, unjust

enrichment, and the enforcement of MCA's lien on the subdivision

property and a third-party defamation claim against Barstein alone.

MCA alleged that RAM-Robertsdale had failed to pay for MCA's work

and that Retail Specialists should be liable as well because it allegedly

dominated and controlled RAM-Robertsdale. MCA further alleged that

Barstein controlled RAM-Robertsdale's conduct at the time and should

be held responsible for its failure to pay.

     The RAM defendants moved for summary judgment on all of MCA's

claims, arguing that the contract between RAM-Robertsdale and MCA

was void for public policy because, the RAM defendants said, MCA was

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not properly licensed when it signed the contract. See, e.g., Hawkins v.

League, 398 So. 2d 232, 235 (Ala. 1981) (noting that "express or implied

contracts" with improperly licensed contractors are void for public policy).

The RAM defendants acknowledged that MCA had a valid general

contractor's license under § 34-8-1 et seq., Ala. Code 1975, but they said

that the license contained the incorrect classification. In particular, MCA

had only a "building construction" classification on its license even

though it needed a "municipal and utility" classification to do the

contracted-for work. See r. 230-X-1-.27(2), (5), Ala. Admin. Code (State

Licensing Bd. for Gen. Contractors). MCA opposed the RAM defendants'

motion, arguing that it held the proper license at the time the contract

was formed and that, if it did not, it corrected any licensure problems

before they became relevant. MCA also argued that RAM-Robertsdale

knew of any defects in MCA's licensure at the time the contract was

formed.

     The circuit court granted the RAM defendants' motion and entered

summary judgment in their favor on all of MCA's claims.2 As a result,

     2While   the summary-judgment order did not detail the circuit
court's reasoning, the circuit court's Rule 54(b) certification stated that
the summary judgment disposed of all of MCA's counterclaims based
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only RAM-Robertsdale's claims remained pending in the circuit court.

With the consent of the parties, the circuit court then certified its

summary judgment as final under Rule 54(b). MCA appealed.

                           Standard of Review

     When reviewing a Rule 54(b) certification, we must determine if the

circuit court exceeded its discretion. See Alabama Ins. Underwriting

Ass'n v. Skinner, 352 So. 3d 688, 690 (Ala. 2021).

                                 Analysis

     Before we can address the merits of this appeal, we must establish

that we have jurisdiction to do so. Because "[a] nonfinal judgment will

not support an appeal," we must decide whether the circuit court's Rule

54(b) order certifying as final its summary judgment on MCA's claims

was proper. Dzwonkowski v. Sonitrol of Mobile, Inc., 892 So. 2d 354, 363

(Ala. 2004).   This Court will "scrutinize the propriety of Rule 54(b)

certifications" even though neither party has raised that issue on appeal,

solely on a legal determination that MCA could not bring counterclaims
against the RAM defendants. That certification also stated that "MCA is
not entitled to recover on any of the asserted claims." As noted in footnote
1, the circuit court referred to MCA's third-party claims as counterclaims,
so the summary judgment disposed of all of MCA's claims, including
those against Retail Specialists and Barstein.
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because it is a " 'fundamental issue.' " Alabama Ins. Underwriting Ass'n,

352 So. 3d at 690 (quoting Summerlin v. Summerlin, 962 So. 2d 170, 172

(Ala. 2007)). In short, we have a duty to guard the jurisdiction of this

Court no matter what the parties may think.

     Rule 54(b) states that, when there are multiple claims in a suit, "the

court may direct the entry of a final judgment as to one or more but fewer

than all of the claims or parties only upon an express determination that

there is no just reason for delay and upon an express direction for the

entry of judgment."    Rule 54(b) certifications should be cabined to

exceptional cases because of "this Court's stated policy disfavoring

appellate review in a piecemeal fashion." Smith v. Slack Alost Dev.

Servs. of Alabama, LLC, 32 So. 3d 556, 562-63 (Ala. 2009).

     Rule 54(b) certification is improper when the claims pending below

and those on appeal "are so closely intertwined that separate

adjudication would pose an unreasonable risk of inconsistent results."

Branch v. SouthTrust Bank of Dothan, N.A., 514 So. 2d 1373, 1374 (Ala.

1987). We have explained that claims are "intertwined" when "[t]he

factual underpinnings of the adjudicated claims are the same as those of

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the unadjudicated [claims] of [the other party]." Fuller v. Birmingham-

Jefferson Cnty. Transit Auth., 147 So. 3d 907, 913 (Ala. 2013).

      Here, all the claims arise from the same transaction -- the contract

between RAM-Robertsdale and MCA to build subdivision infrastructure

and the parties' performance under that contract. The RAM defendants

argued in their summary-judgment motion that MCA was not properly

licensed and could not recover on the contract because, they said, that

contract violated public policy. The circuit court agreed. But if the

contract is void for public policy, then neither party would be able to

enforce it -- void means void for all parties involved. See White-Spunner

Constr., Inc. v. Construction Completion Co., LLC, 103 So. 3d 781, 787

(Ala. 2012) (noting that it is a "well settled principle of law that ' "a party

to an illegal contract cannot come into a court of law and ask to have his

illegal objects carried out ...." ' " (citations omitted)); Dream, Inc. v.

Samuels, [Ms. SC-2022-0808, June 23, 2023] ___ So. 3d ___, ___ (Ala.

2023) ("Alabama courts … will not enforce a void or illegal contract.").

And while this Court has held that an exception to the void-for-public-

policy rule may exist if one of the parties was induced by fraud to execute

a contract, see Youngblood v. Bailey, 459 So. 2d 855, 860 (Ala. 1984),

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MCA has argued that RAM-Robertsdale knew that MCA did not have a

"municipal and utility" classification at the time the contract was formed.

If that is true, RAM-Robertsdale could have unclean hands in the

transaction, which may limit RAM-Robertsdale's recovery on the claims

still pending below. See § 34-8-6(a), Ala. Code 1975 (proscribing both

general contracting without a proper license and considering bids "from

anyone not properly licensed").

     The upshot here is that the claims pending below and those on

appeal have significant "factual overlap." Clarke-Mobile Cntys. Gas Dist.

v. Prior Energy Corp., 834 So. 2d 88, 95 (Ala. 2002). The questions before

us -- whether MCA was properly licensed and whether it can enforce the

contract -- bear on RAM-Robertsdale's claims pending below.           And

deciding those issues now would create an intolerable risk of inconsistent

results. For that reason, the circuit court exceeded its discretion by

certifying its summary judgment on MCA's claims against the RAM

defendants as final. Accordingly, we do not have jurisdiction to resolve

the merits of this appeal.

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                                Conclusion

     Because the circuit court's summary judgment was improperly

certified as final, we dismiss this appeal for lack of jurisdiction.

     APPEAL DISMISSED.

     Parker, C.J., and Shaw, Wise, Bryan, Stewart, and Cook, JJ.,

concur.

     Sellers and Mendheim, JJ., concur in the result.

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