Articles Posted in Supreme Court of Alabama

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In case no. 1170709, Jere Austill III appealed a circuit court judgment permitting Tyler Montana Jul Prescott to redeem certain real property under sections 40-10-82 and 40-10-83, Ala. Code 1975. Specifically, Austill argued that, through adverse possession, he had "cut off" Prescott's right to redeem the property. Because the Alabama Supreme Court concluded that, by virtue of an adverse judgment in an earlier quiet-title action, Austill was precluded by the doctrine of res judicata from claiming an interest in the property through the extinguishment of Prescott's right of redemption. Therefore, the Supreme Court affirmed that portion of the trial court's judgment that challenged in Austill's appeal. In case no. 1170730, Prescott cross-appealed the trial court's denial of his motion for an award of attorney fees under the Alabama Litigation Accountability Act ("the ALAA"). In support thereof, Prescott argued Austill asserted his argument that he cut off Prescott's right of judicial redemption without substantial justification. The Supreme Court concluded the trial court did not exceed its discretion in denying Prescott's motion, and affirmed that portion of the trial court's judgment. View "Austill III v. Prescott" on Justia Law

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Deutsche Bank National Trust Company ("Deutsche Bank"); MERSCORP, Inc., and Mortgage Electronic Registration Systems, Inc. (collectively, "MERS"); and CIS Financial Services, Inc. ("CIS"), petitioned the Alabama Supreme Court for permission, pursuant to Rule 5, Ala. R. App. P., to appeal the trial court's denial of their motions seeking to dismiss the claims of the plaintiffs-- Walker County and Rick Allison, in his official capacity as judge of probate of Walker County (collectively, "plaintiffs")--seeking class-based relief on behalf of themselves and all other similarly situated Alabama counties and judges of probate. At issue was a particular aspect of the mortgage-securitization process. Deutsche Bank served as trustee for numerous residential mortgage-backed security ("RMBS") trusts containing mortgages for properties located in Walker County and other Alabama counties. In this case, plaintiffs initiated the underlying litigation against Deutsche Bank "seeking to recover the benefit [Deutsche Bank allegedly] received by relying on the real property recording systems of the Counties without compensating the Counties for that benefit." Plaintiffs alleged that Alabama law requires mortgage assignments to be recorded; therefore, they maintained, the MERS system used by Deutsche Bank avoided the proper recording of mortgage assignments, along with the payment of the requisite filing fees, and has resulted in lost income to county governments. The Alabama Supreme Court reversed the trial court and remanded: “We see no intent in the Code section to embrace a mandatory rule that all conveyances, which would include not only real-property conveyances but also apparently all conveyances of personal property, are required to be recorded in the probate court. Instead, 35-4-50 simply states that the probate court is where conveyances that are required by law to be filed must be filed. Section 35-4-51, in turn, is the Code section that provides for the recording of conveyances generally, and it places a duty on only the probate court to accept those filings. The arguments before us demonstrate no legal duty to record mortgage assignments.” View "Deutsche Bank National Trust Company, as trustee of any specific residential mortgage-backed security" on Justia Law

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Plaintiffs David and Lisa McDaniel petitioned the Alabama Supreme Court for a writ of mandamus to direct the Shelby Circuit Court to vacate its order staying the proceedings against defendants Southern Craftsman Custom Homes, Inc. ("SCCH"); Jeffrey Rusert; Larry Curry, Sr.; SouthFirst Bancshares, Inc., d/b/a SouthFirst Bank ("SouthFirst"); Mari Gunnels; and Danny Keeney. At the time of this opinion, Rusert was awaiting the outcome of a federal criminal investigation against him. In 2017, the McDaniels contacted Rusert for the purpose of entering into an agreement with SCCH to build a house. According to the McDaniels, Rusert represented himself as the president of SCCH. At some point, Rusert recommended that the McDaniels speak with Gunnels, who worked for SouthFirst, to secure a loan to pay for the construction of the new house. In November 2017, with Gunnels's assistance, the McDaniels began the process of applying for a construction loan with SouthFirst. The loan closing occurred on January 26, 2018. The McDaniels executed, among other agreements, a written construction-loan agreement, a promissory note, and a construction-loan disbursement agreement. The McDaniels met with Rusert to discuss some concerns they had with the ongoing construction. During that meeting, Rusert provided the McDaniels with a credit application from a local building-supply company and asked them to execute it so that, he said, he could use the McDaniels' credit to purchase building materials and supplies. The McDaniels learned that the company refused to do business with SCCH, Rusert, and Curry because all three had purportedly failed to pay significant amounts owed the company. The McDaniels immediately contacted Gunnels and placed a "stop-payment" order on the most recent draw request from SCCH and Rusert. Thereafter, the McDaniels sued SCCH, Rusert, Curry, SouthFirst, Gunnels, and Keeney. In their complaint, the McDaniels sought damages for negligence, suppression, fraudulent misrepresentation, civil conspiracy, conversion, and the infliction of emotional distress. The McDaniels further alleged breach-of-contract claims against SouthFirst, SCCH, Rusert, and Curry, as well as a claim of breach of fiduciary duties against SouthFirst. Finally, the McDaniels sought a judgment against SouthFirst, Gunnels, and Keeney declaring the loan agreement and mortgage void. Rusert and SCCH moved to stay the civil proceedings against them pending the outcome of a federal criminal investigation against Rusert, which the trial court granted. The Alabama Supreme Court determined, however, the McDaniels established a clear legal right to relief from the trial court's order. Accordingly, the Supreme Court granted the petition for a writ of mandamus and directed the trial court to vacate its order staying the underlying case. View "Ex parte David and Lisa McDaniel." on Justia Law

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Plaintiffs A.A. Nettles, Sr. Properties Limited, and Eula Lambert Boyles sought to quiet title a right-of-way that had been conveyed by the Alabama Railroad Company to the Monroe County Commission for use as a recreational trail in accordance with the National Trails System Act ("the Trails Act"), 16 U.S.C. 1247. The trial court quieted title in favor of plaintiffs. The Commission appealed, contending the evidence submitted was insufficient for the trial court to determine the railroad intended to abandon its interest in the right-of-way. The Alabama Supreme Court concluded the trial court did not err in concluding the easement reserved to the railroad by a right-of-way was provided in a quitclaim deed lapsed by nonuse, and was thus extinguished by operation of law, leaving nothing for the railroad to convey to the Commission. View "Monroe County Commission v. Nettles, et al." on Justia Law

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Ralph Eustace, Linda Eustace, and Daryl Eustace sued James Ray ("Ray") Wilbourn and his wife Karen, alleging a trespass to land and conversion of timber. The Wilbourns filed a counterclaim, seeking to establish title to the subject land and to recover in tort for intentional interference with a contractual relationship. The trial court entered a judgment in favor of the Eustaces on the trespass and conversion-of-timber claims and determined that the Eustaces were entitled to recover compensatory damages on those claims. The trial court also entered a judgment in favor of the Wilbourns on the claim asserting an intentional interference with a contractual relationship and determined that the Wilbourns were entitled to an award of compensatory damages on that claim. The Court of Civil Appeals affirmed the judgment of the trial court, without an opinion. The Alabama Supreme Court determined the Court of Civil Appeals lacked jurisdiction over the case because the appeal was taken from a nonfinal judgment. Therefore, the appellate court's judgment was reversed and the matter remanded with instructions to dismiss the appeal. View "Ex parte Ralph Eustace et al." on Justia Law

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This case contested the validity of a property deed that was executed by Gayron Brooks in the weeks before her death from lung cancer. The deed conveyed her house in Boaz to her husband of 18 years, David. Following Gayron's death, her adult children, Teresa Elizabeth Mitchell and Steve E. Allen, as personal representatives of Gayron's estate, sued David alleging, among other things, that David held a dominant position over Gayron and that he had unduly influenced her to sign the deed. After a four-day nonjury trial, the trial court entered a judgment in favor of David. This appeal followed. Finding no reversible error in the circuit court's judgment, the Alabama Supreme Court affirmed. View "Mitchell v. Brooks" on Justia Law

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Plaintiff Tim Seriana sought mandamus relief to order the circuit court reverse its grant of a motion for change of venue filed by Joe Stevens, LLC. In 2015, Seriana and his wife, Karen, sued Joe Todd Stevens (and his LLC) and various fictitiously named defendants, alleging Stevens was a contractor who did business in northeast Alabama who negligently failed to barricade, cordon off, or otherwise warn pedestrians of a big ditch then excavated by Stephens. Seriana fell into the ditch, and sustained an injury. In his petition, Seriana argued the trial court erroneously transferred this case to Talladega County because, he contended, Stevens waived any objection it might have had to venue in Calhoun County when it answered the amended complaint without raising the defense of improper venue. The Alabama Supreme Court agreed, granted the writ of mandamus, and directed the trial court to vacate its motion for change of venue and transfer this case to Talladega County. View "Ex parte Tim Seriana." on Justia Law

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SE Property Holdings, LLC ("SEPH") appealed the grant of summary judgment entered in favor of Bank of Franklin ("BOF") on BOF's claim demanding specific performance of a contractual provision. In March 2005, Vision Bank, a Florida company, loaned Bama Bayou, LLC, formally known as Riverwalk, LLC ("the borrower"), $6,000,000. Multiple individuals allegedly personally guaranteed repayment of the loan ("the guarantors"). In June 2008, pursuant to a "participation agreement," Vision Bank conveyed to BOF a 25 percent interest in the loan. Vision Bank conveyed additional participation interests in the loan to other banks. The borrower and the guarantors allegedly defaulted on their obligations with respect to the loan, and in January 2009 Vision Bank filed suit against them. The borrower and the guarantors asserted counterclaims against Vision Bank and brought BOF into the action as an additional counterclaim defendant. In April 2009, Vision Bank foreclosed on a mortgage securing the loan. Vision Bank was the highest bidder at the foreclosure sale and thereafter executed foreclosure deeds in favor of BOF and the other participating banks. In 2012, Vision Bank sold its operating assets to Centennial Bank and relinquished its Florida bank charter. Vision Bank and SEPH entered into an "agreement and plan of merger," whereby Vision Bank merged "with and into" SEPH. In October 2016, the trial court entered an order setting aside the foreclosure sale and declaring the foreclosure deeds void. Among other things, BOF asserted in its cross-claim that SEPH had an obligation to repurchase BOF's participation interest in the loan. In support, BOF pointed to the participation agreement between BOF and SEPH's predecessor, Vision Bank. The court granted BOF's motion for summary judgment on its claim for specific performance based on the participation agreement. SEPH argued on appeal that the trial court erred in determining that a "proceeding" involving Vision Bank's termination of existence was "commenced," so as to invoke the contractual provision; it asserted Vision Bank's voluntary merger with SEPH was not a "proceeding." The participation agreement in this case stated that BOF's participation interest was conveyed without recourse, but the contract provision provided BOF at least some security in the form of a right to force the repurchase of its participation interest in the event of the financial deterioration of the originating bank, i.e., Vision Bank. The Alabama Supreme Court concluded the voluntary merger like the one entered into by Vision Bank and SEPH is not a "proceeding" as that term is used in the participation agreement, and reversed the trial court's judgment ordering SEPH to purchase BOF's participation interest. View "SE Property Holdings, LLC, f/k/a Vision Bank v. Bank of Franklin" on Justia Law

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Hartung Commercial Properties, Inc. ("Hartung"), appealed the grant of summary judgment in favor of Buffi's Automotive Equipment and Supply Company, Inc. ("Buffi's Automotive"). Wayne Hartung bought a piece of commercial property that had an auto-body collision, repair, and paint shop ("the body shop") on the premises. Wayne also formed Har-Mar Collisions, Inc. ("Har-Mar") to operate the body shop. Hartung subsequently entered into a lease with Har-Mar pursuant to which Har-Mar leased the body shop. Wayne had a custom-built paint booth installed in the body shop and hired Buffi's Automotive to make the paint booth operational once it was installed. On January 24, 2011, the body shop was completely destroyed by a fire. On July 8, 2011, Hartung sued Har-Mar, Buffi's Automotive, and several fictitiously named defendants in the circuit court asserting claims of negligence and wantonness related to their alleged roles in causing the fire that destroyed the body shop. Buffi's Automotive alleged that, sometime after the fire destroyed the body shop, Hartung ordered what remained of the body shop and all the equipment inside it to be demolished. Buffi's Automotive argued that Hartung allowed the body shop to be demolished even though it believed at that time that Buffi's Automotive had caused the fire; that Buffi's Automotive "was named as a defendant only after the evidence was destroyed"; and that Buffi's Automotive "should have been placed on notice of the claim and allowed to inspect the premises with its own experts prior to destruction of the evidence." The Alabama Supreme Court determined the circuit court could not properly conclude that the sanction of dismissal, as opposed to some lesser sanction, was mandated in the present case. “[B]ased on the record before us at this time, we are simply not convinced that Buffi's Automotive met its burden in this case.” Accordingly, summary judgment was reversed. View "Hartung Commercial Properties, Inc. v. Buffi's Automotive Equipment and Supply Company, Inc." on Justia Law

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Robert Robinson appealed a circuit court's dismissal of his action against Harrigan Timberlands Limited Partnership ("Harrigan"), Scotch Land Management, LLC ("Scotch"), Fulton Logging Company, LLC ("Fulton"), Black Sheep Woodlands, LLC ("Black Sheep"), and Todd Overstreet d/b/a Overstreet Timber Company ("Overstreet") (collectively referred to as "the Harrigan defendants") for the alleged wrongful cutting of timber. The pivotal factor in the trial court's judgment that the eastern boundary line of "Parcel Two" was located in one location suggested by the documentary evidence rather than another location suggested by documentary evidence was the court's on-site inspection of the property, an inspection made during the summary-judgment stage of the proceedings. Ultimately, the trier of fact may reject Robinson's contention that the "Bassetts Creek" referred to in his deeds as marking the eastern boundary of Parcel Two was in a different location than the location suggested by the Harrigan defendants. But, on the record before the Alabama Supreme Court, that was not a judgment that appropriately could be determined by summary judgment. Therefore, the trial court's judgment was reversed and the matter remanded for further proceedings. View "Robinson v. Harrigan Timberlands Limited Partnership" on Justia Law