Justia Construction Law Opinion SummariesArticles Posted in Supreme Court of Alabama
Castleberry v. Angie’s List, Inc.
Jessie and Rickey Castleberry appealed a circuit court order dismissing their claims against Angie's List, Inc., based on a forum-selection clause in a contract between Angie's List and the Castleberrys. The Castleberrys, who are father and son, became members of Angie's List in 2014. They claim that they used their membership with Angie's List to locate a contractor, Dream Baths of Alabama, LLC ("Dream Baths"), which the Castleberrys hired to renovate a bathroom in Jessie Castleberry's house to make it handicapped accessible. According to the Castleberrys, Dream Baths was not properly licensed and poorly performed the work it contracted to do. The Alabama Supreme Court found the Castleberrys simply pointed out in the argument section of their brief that, in addition to suing Angie's List, they also sued Dream Baths. They asserted that "[t]his action pertains not only to the agreement between the Castleberrys and Angie's List, but to improper work performed upon a home located in Montgomery County, Alabama by defendant Dream Baths." The Castleberrys provided no significant discussion of the specific claims against Dream Baths and Angie's List. To the Supreme Court, it appealred that the Castleberrys' claims against Angie's List and Dream Baths were based on different categories of wrongdoing that were only tangentially related. The trial court, therefore, did not err in enforcing the forum-selection clause simply because the Castleberrys also sued Dream Baths. View "Castleberry v. Angie's List, Inc." on Justia Law
Ex parte Alvin Bhones and Diane Bhones.
Plaintiffs Alvin and Diane Bhones sought a writ of mandamus to direct the circuit court to vacate its order setting aside a default judgment entered in their favor against Travis Peete and Beech Brook Companies, LLC. In 2015, the Bhoneses sued Beech Brook and Peete, the sole member of Beech Brook, based on their allegedly defective construction of the Bhoneses' new home. The complaint stated claims of breach of contract, breach of warranty, fraud, fraudulent misrepresentation, and negligence. The complaint was served on defendants on February 19, 2015, but they did not file an answer. On March 13, 2018, the Bhoneses moved for a default judgment. On March 21, 2018, the trial court entered a default judgment in favor of the Bhoneses. The Alabama Supreme Court found that because defendants did not present evidence to support their allegations that they had a meritorious defense and that the Bhoneses would not be unduly prejudiced if the default judgment was set aside, defendants failed to satisfy their initial burden of alleging and demonstrating the existence of all the Kirtland v. Fort Morgan Authority Sewer Service, Inc., 524 So. 2d 600 (Ala. 1988) factors. Therefore, defendants were not entitled to have the default judgment set aside and that the trial court exceeded its discretion in setting aside the default judgment. View "Ex parte Alvin Bhones and Diane Bhones." on Justia Law
Ex parte Consolidated Pipe & Supply Co., Inc.
Consolidated Pipe filed the underlying action against The Ohio Casualty Insurance Company ("Ohio Casualty"), Bolt Construction & Excavating, LLC ("Bolt Construction"), and Michael Bolt (collectively, defendants). The West Morgan East Lawrence Water and Sewer Authority ("the Water Authority") contracted with Bolt Construction to perform a public work known as "the Vaughn Bridge Road Water Line Relocation Project No. 14018.00" ("the project"). In the course of performing its contract with the Water Authority, Bolt Construction entered into a contract with Consolidated Pipe pursuant to which Consolidated Pipe was to supply materials for use in the project. Bolt executed a guaranty in conjunction with the contract with Consolidated Pipe in which he agreed to unconditionally and personally guarantee full and prompt payment of all sums owed to Consolidated Pipe by Bolt Construction in the event Bolt Construction failed to pay the contracted-for amount. In its complaint, Consolidated Pipe alleged Bolt Construction failed to pay Consolidated Pipe for the materials it furnished to Bolt Construction for the project. At issue in this case was venue: the Alabama Supreme Court determined that based on a forum-selection clause, the only proper venue for this action was Morgan County. Therefore, the circuit court erred by granting the motion to transfer. Accordingly, the Court granted Consolidated Pipe's petition for mandamus relief, and directed the Morgan Circuit Court to vacate its order transferring this case to Jackson County. View "Ex parte Consolidated Pipe & Supply Co., Inc." on Justia Law
Brooks v. RPM Cranes, LLC
In 2015, RPM Cranes and its owner Muhammad Wasim Ali sued the defendants CraneWorks, Inc. and its owners, David Upton ("David") and Steve Upton ("Steve"), and Russell Brooks, Rick Yates, and Casey Markos, alleging that Brooks, Yates, and Markos had violated their employment agreements by going to work for CraneWorks and that CraneWorks' hiring of Brooks, Yates, and Markos likewise violated those employment agreements. David and Steve were named as defendants by virtue of their ownership of CraneWorks. RPM and Ali sought monetary damages and injunctive relief. The trial court entered a permanent injunction in favor of RPM and Ali and against the defendants. The Alabama Supreme Court found the injunction at issue in defendants' appeal was not specific in its scope: the order stated that the defendants were "permanently restrained and enjoined from contacting, in any way, whatsoever, any of those clients which are now clients of RPM Cranes." The order failed, however, to specify which clients were included in the injunction. RPM and Ali introduced no evidence as to who RPM's clients were or whether it had developed any clients of its own that Yates and Brooks did not bring onboard as a result of their previous jobs with other entities. In other words, the injunction was broad and vague rather than "specific in [its] terms." The Court reversed the trial court's order and remanded for further proceedings. View "Brooks v. RPM Cranes, LLC" on Justia Law
Rainbow Cinemas, LLC v. Consolidated Construction Company of Alabama
Rainbow Cinemas, LLC ("Rainbow"), Ambarish Keshani, and Harshit Thakker (collectively, "the defendants") appealed a circuit court order denying their motion to compel arbitration of a contract dispute with Consolidated Construction Company of Alabama ("CCC"). In the contract at issue here, CCC agreed to provide specified services in constructing a movie theater for Rainbow. The parties signed the American Institute of Architects "Document A101-2007 -- Standard Form of Agreement Between Owner and Contractor where the basis of payment is a Stipulated Sum" ("the agreement"). The agreement incorporated by reference American Institute of Architects "Document A201-2007 -- General Conditions of the Contract for Construction" ("the general conditions"). In 2016, after having already initiated the arbitration process, CCC sued the defendants. Among other things, CCC alleged that the defendants had fraudulently induced it into entering into the contract. Specifically, CCC alleged that the defendants knew that the contract required an initial decision maker and that the defendants also "knew they had not contracted for [initial-decision-maker] services from the [initial decision maker]." CCC alleged that the defendants "failed to inform CCC ... that Rainbow had not contracted with [architect Hay] Buchanan to act as [the initial decision maker]." The Alabama Supreme Court reversed and remanded, finding that the contract incorporated the AAA's Construction Industry Arbitration Rules, which state that "[t]he arbitrator shall have the power to rule on his or her own jurisdiction, including any objections with respect to the existence, scope, or validity of the arbitration agreement." Although the question whether an arbitration provision may be used to compel arbitration between a signatory and a nonsignatory is a threshold question of arbitrability usually decided by the court, here that question was delegated to the arbitrator. The arbitrator, not the court, had to decide that threshold issue. View "Rainbow Cinemas, LLC v. Consolidated Construction Company of Alabama" on Justia Law
Aliant Bank v. Four Star Investments, Inc.
Aliant Bank, a division of USAmeribank ("Aliant"), sued various individuals and business entities involved in a failed effort to develop the Twelve Oaks subdivision in Odenville, alleging that, as a result of those defendants' conspiracy and wrongful actions, Aliant's security interest in the property upon which the Twelve Oaks subdivision was to be built had been rendered worthless. The Circuit Court ultimately entered a number of orders either dismissing Aliant's claims or entering a summary judgment in favor of the various defendants. Aliant filed three appeals. In appeal no. 1150822, the Alabama Supreme Court reversed summary judgment against Aliant: (1) on the negligence and breach-of-fiduciary duty claims asserted against the Board members in count four of Aliant's complaint; (2) on the fraudulent-misrepresentation and fraudulent-suppression claims asserted against Bobby Smith and Twelve Oaks Properties in count seven of Aliant's complaint; and (3) on the conspiracy claims asserted against Smith, Twelve Oaks Properties, Four Star Investments, Mize, and Billy Smith in count seven of Aliant's complaint. The Court affirmed summary judgment against Aliant and in favor of the various Twelve Oaks defendants in all other respects. In appeal no. 1150823, the Court reversed the summary judgments entered against Aliant on the fraudulent misrepresentation and conspiracy claims asserted against Pfil Hunt, and his management company Wrathell, Hunt & Associates, LLC, in count seven of Aliant's complaint; however, the Court affirmed those summary judgments with regard to all other claims asserted by Aliant against Hunt and WHA. Finally, in appeal no. 1150824, the Court affirmed summary judgment against Aliant and in favor of the Engineers of the South, LLC defendants on all counts. View "Aliant Bank v. Four Star Investments, Inc." on Justia Law
Hanover Insurance Co. v. Kiva Lodge Condominium Owners’ Association, Inc.
Kiva Lodge Condominium Owners' Association, Inc. ("Kiva Lodge") was an Alabama nonprofit corporation formed for the purpose of administering and maintaining the Kiva Dunes Clubhouse and Condominium ("Kiva Dunes") located in Gulf Shores. In 2009, Kiva Lodge contracted with Hudak & Dawson Construction Co., Inc. ("Hudak") to be the general contractor for the remediation of deficiencies in Kiva Dunes buildings that were allowing water to enter the buildings. Hudak subcontracted the stucco and/or sealant portion of the work to Don Colvin d/b/a Colvin Plastering ("Colvin"). The Hanover Insurance Company ("Hanover"), as surety for Hudak, issued to Kiva Lodge a performance bond ensuring and/or securing the full performance of Hudak's contractual obligations. In September 2012, Kiva Lodge informed Hudak and Colvin of leaks and bubbling in the stucco exterior of the buildings at Kiva Dunes caused by water intrusion. Kiva Lodge alleged that Hudak and Colvin failed to determine and/or disclose the course of the problems and the proper scope of repairs necessary. It also alleged that Hanover breached the terms of its performance bond by failing to promptly remedy the default, complete the work within the scope of the contract in accordance with the terms and conditions, or arrange for payment of an alternative contractor to complete the work. Hanover filed a motion to dismiss Kiva Lodge's claims against Hanover on the ground that, under its performance bond, its claims were time-barred, falling outside of a two-year statute of limitations. In 2015, the circuit court heard arguments concerning Kiva Lodge's motion to compel arbitration, eventually granting the stay and ordering the parties to arbitration. The court also denied Hanover's motion to dismiss. Hudak, Colvin, and Hanover timely appealed the circuit court's order. After review, the Supreme Court found no reversible error in the trial court's order and affirmed. View "Hanover Insurance Co. v. Kiva Lodge Condominium Owners' Association, Inc." on Justia Law
Hoover General Contractors – Homewood, Inc. v. Key
Hoover General Contractors – Homewood, Inc. ("HGCH"), appealed a circuit court order denying its motion to compel arbitration of its dispute with Gary Key regarding work performed by HGCH on Key's house in Jasper after that house was damaged by a fire. Six months after Key sued HGCH asserting claims stemming from HGCH's work rebuilding Key's house after a fire, HGCH moved the trial court to compel Key to arbitrate those claims pursuant to an arbitration clause in the contract Key had entered into with HGCH. The trial court denied HGCH's motion to compel; however, that denial was error because Key failed to establish through substantial evidence that HGCH had waived its right to arbitration by substantially invoking the litigation process. Accordingly, the order entered by the trial court denying HGCH's motion to compel arbitration was reversed by the Supreme Court and the case remanded for the trial court to enter a new order compelling Key to arbitrate his claims ursuant to the terms of his contract with HGCH. View "Hoover General Contractors - Homewood, Inc. v. Key" on Justia Law
Dannelly Enterprises, LLC v. Palm Beach Grading, Inc.
Dannelly Enterprises, LLC ("Dannelly"), appealed a circuit court order granting a motion to compel arbitration filed by Palm Beach Grading, Inc. ("PBG"). In the fall of 2006, PBG entered into negotiations with Corvias Military Living, LLC, f/k/a Picerne Military Housing LLC; Picerne Construction/FRK, LLC; Rucker-Picerne Partners, LLC; and Rucker Communities, LLC (collectively, "the contractors"), to perform work on a project known as the Ft. Rucker RCI Family Housing, Munson Heights, Phase 1A, at Fort Rucker, Alabama. Apparently, in preparing to bid on the project, PBG contacted various subcontractors, including Dannelly, to get bids for various aspects of the project that PBG would be responsible for if it entered into an agreement with the contractors to complete the project. Although the work order issued by PBG stated that "[a] Sub-contract will be created by PBG for billing purposes," neither party submitted into evidence such a contract between PBG and Dannelly. PBG argued that Donnelly accepted benefits under existing contracts because Dannelly was hired by PBG to perform work on the project and was paid for the work it completed. The Supreme Court found, however, that PBG did not present any argument as to why it believed Dannelly was not simply operating under and benefiting from the agreement between PBG and Dannelly, which was memorialized by PBG's work order. The Court concluded that PBG failed to demonstrate that the arbitration provision in the master subcontract agreement applied to the third-party claims it asserted against Dannelly. Furthermore, there was a genuine issue of material fact as to whether Dannelly and PBG entered into PBG's standard subcontract agreement. The case was reversed and remanded to the circuit court for further proceedings. View "Dannelly Enterprises, LLC v. Palm Beach Grading, Inc." on Justia Law