Articles Posted in Supreme Court of Alabama

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Warrior Met Coal, LLC sued Eickhoff Corporation alleging certain pieces of heavy mining equipment Eickhoff had manufactured and sold to Warrior Coal were defective. Eickhoff subsequently moved the trial court to compel Warrior Coal to arbitrate its claims pursuant to an arbitration provision in contracts executed after the sale of the equipment, not the original purchase-order contracts associated with the allegedly defective equipment. The trial court denied the motion to compel arbitration and Eickhoff appeals. The Alabama Supreme Court determined the breach-of-warranty, breach-of-contract, and products-liability claims asserted by Warrior Coal in its action against Eickhoff were at least arguably connected to the master service agreements inasmuch as those contracts addressed Eickhoff's obligation to provide an employee to assist with the maintenance and operation of the longwall shearers (the allegedly defective equipment). Accordingly, because the parties also agreed in the master service agreements that the AAA commercial arbitration rules would govern any arbitration, and because those rules empowered the arbitrator to decide questions of arbitrability, the trial court erred when it instead at least implicitly resolved the arbitrability issue in favor of Warrior Coal in its order denying Eickhoff's motion to compel. That order was accordingly reversed and the case remanded for the trial court to enter an order granting Eickhoff's motion to compel arbitration and staying proceedings in the trial court during the pendency of the arbitration proceedings. View "Eickhoff Corporation v. Warrior Met Coal, LLC" on Justia Law

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Alfa Insurance Corporation, ALFA Mutual General Insurance Corporation, ALFA Life Insurance Corporation, and ALFA Specialty Insurance Corporation (collectively, "Alfa") petitioned the Alabama Supreme Court for a writ of mandamus seeking review of an order entered by the Montgomery Circuit Court on December 18, 2015. Although Alfa set forth three issues for review, the Supreme Court reviewed only one: whether the circuit court had jurisdiction to enter the December 18, 2015, order and whether it exceeded its discretion by not setting that order aside. R.G. "Bubba" Howell, Jr., and M. Stuart "Chip" Jones were insurance agents for an Alfa insurance agency in Mississippi. Their agency agreements with Alfa included an arbitration provision, as well as a provision requiring Howell and Jones to purchase "errors and omissions" insurance coverage. In 2012, Alfa accused Howell and Jones of selling competing products in contravention of their agency agreements; Howell and Jones, however, alleged that their actions had been approved by Alfa. Regardless, Alfa forced Howell to resign his position as an Alfa agent on December 31, 2012, and discharged Jones on January 1, 2013. After review, the Supreme Court concluded the circuit court exceeded its discretion in entering the December 18, 2015, order compelling discovery pretermitted discussion of the other, two discovery issues. View "Ex parte Alfa Insurance Corporation et al." on Justia Law

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SCI Alabama Funeral Services, LLC, d/b/a Elmwood Cemetery and Mausoleum ("SCI"); Service Corporation International; SCI Funeral Services, LLC; Elmwood Cemetery Co.; Phyllis Pesseackey; and Jonathan Wheatley (collectively, "the defendants") appealed an order denying their motion to compel arbitration. The circuit court denied the motion to compel because it concluded that the relevant arbitration provision was unconscionable and thus unenforceable. In 2004, Johnnie Hinton ("Johnnie") signed a contract with SCI to purchase the interment rights to two burial spaces in Elmwood Cemetery. The contract contained an arbitration provision stating that "any claim" that Johnnie "may have" against SCI must be resolved by arbitration. In August 2016, Johnnie's husband, Nathaniel Hinton, passed away. Johnnie began to make arrangements to have Nathaniel buried in one of the two burial spaces to which she had acquired interment rights in 2004. SCI then informed Johnnie that someone else had mistakenly been buried in Nathaniel's space. According to Johnnie's complaint, the space she acquired for Nathaniel is next to the space where her father is buried. At Johnnie's request, SCI disinterred the deceased who was buried in the space Johnnie had acquired and buried him elsewhere so that Nathaniel could be buried in the space; Nathaniel was subsequently buried there. In September 2016, Johnnie sued SCI and the other defendants, alleging breach of contract and several other claims. The defendants moved to compel arbitration, citing the arbitration provision in the contract. Johnnie argued that the arbitration provision was unenforceable because, she said, the contract does not evidence a transaction affecting interstate commerce and the arbitration provision is unconscionable. The circuit court denied the motion to compel, concluding that the arbitration provision is unconscionable. Both substantive unconscionability and procedural unconscionability must be shown to establish unconscionability as a defense to an arbitration provision; these are separate, independent elements. The Alabama Supreme Court determined the arbitration provision in this case was not substantively unconscionable, and did not need to consider the issue of procedural unconscionability. The circuit court erred in denying the motion to compel arbitration. Therefore, the Court reversed the order and remanded the case for the circuit court to enter an order granting the motion to compel arbitration. View "SCI Alabama Funeral Services, LLC v. Hinton" on Justia Law

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SCI Alabama Funeral Services, LLC, d/b/a Elmwood Cemetery and Mausoleum ("SCI"); Service Corporation International; SCI Funeral Services, LLC; Elmwood Cemetery Co.; Phyllis Pesseackey; and Jonathan Wheatley (collectively, "the defendants") appealed an order denying their motion to compel arbitration. The circuit court denied the motion to compel because it concluded that the relevant arbitration provision was unconscionable and thus unenforceable. In 2004, Johnnie Hinton ("Johnnie") signed a contract with SCI to purchase the interment rights to two burial spaces in Elmwood Cemetery. The contract contained an arbitration provision stating that "any claim" that Johnnie "may have" against SCI must be resolved by arbitration. In August 2016, Johnnie's husband, Nathaniel Hinton, passed away. Johnnie began to make arrangements to have Nathaniel buried in one of the two burial spaces to which she had acquired interment rights in 2004. SCI then informed Johnnie that someone else had mistakenly been buried in Nathaniel's space. According to Johnnie's complaint, the space she acquired for Nathaniel is next to the space where her father is buried. At Johnnie's request, SCI disinterred the deceased who was buried in the space Johnnie had acquired and buried him elsewhere so that Nathaniel could be buried in the space; Nathaniel was subsequently buried there. In September 2016, Johnnie sued SCI and the other defendants, alleging breach of contract and several other claims. The defendants moved to compel arbitration, citing the arbitration provision in the contract. Johnnie argued that the arbitration provision was unenforceable because, she said, the contract does not evidence a transaction affecting interstate commerce and the arbitration provision is unconscionable. The circuit court denied the motion to compel, concluding that the arbitration provision is unconscionable. Both substantive unconscionability and procedural unconscionability must be shown to establish unconscionability as a defense to an arbitration provision; these are separate, independent elements. The Alabama Supreme Court determined the arbitration provision in this case was not substantively unconscionable, and did not need to consider the issue of procedural unconscionability. The circuit court erred in denying the motion to compel arbitration. Therefore, the Court reversed the order and remanded the case for the circuit court to enter an order granting the motion to compel arbitration. View "SCI Alabama Funeral Services, LLC v. Hinton" on Justia Law

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Bridgestone Americas Tire Operations, LLC, d/b/a GCR Tires & Service ("Bridgestone"), appealed a circuit court order denying Bridgestone's motion to compel arbitration of an employment-related dispute. Ottis Adams began working as a sales representative for Bridgestone or a related entity in May 2006 and that he resigned or his employment was terminated in August 2016. At some point at or around the time he was hired, Adams signed a document entitled "New Employee Agreement and Acknowledgment of the Bridgestone/Firestone, Inc. Employee Dispute Resolution Plan" ("the agreement"), which stated that Adams agreed to the terms of the employee-dispute-resolution plan, fully titled, the "BFS Retail & Commercial Operations, LLC, Employee Dispute Resolution Plan" ("the EDR Plan"). The EDR Plan contained an arbitration provision. After leaving Bridgestone in 2016, Adams went to work for McGriff Tire Company, Inc. ("McGriff"). At some point thereafter, McGriff's principal, Barry McGriff, received a letter written on the letterhead of Bridgestone's corporate parent, asserting that Adams signed a noncompetition and nonsolicitation agreement with his previous employer, that his employment with McGriff violated that agreement, and that Adams allegedly had violated a duty of loyalty by selling tires for McGriff while still employed by Bridgestone. The letter also suggested that Adams may have disclosed, or might disclose, "confidential information and trade secrets." The letter stated that Bridgestone was planning to commence legal action against Adams and concluded with a suggestion that McGriff might be named as a defendant in that action if the matter was not resolved. Adams asserts that, because of the accusations in the letter, McGriff terminated his employment. Adams sued Bridgestone and related entities, alleging Bridgestone interfered with his business relationship with McGriff and had defamed him via the letter to Barry McGriff. Adams subsequently voluntarily dismissed all defendants except Bridgestone. Bridgestone filed an answer and a counterclaim. In its counterclaim, Bridgestone averred that Adams, while still employed by Bridgestone, had taken actions for McGriff's benefit and had "feigned acceptance" of an employment agreement he never actually signed that included a noncompetition provision. Although Bridgestone did not mention arbitration or the EDR Plan in its answer or counterclaim, approximately three months after filing those pleadings, it amended its answer to assert arbitration as a defense, and it filed a motion to compel arbitration of all claims pursuant to the terms of the EDR Plan. The trial court denied Bridgestone's motion to compel, and Bridgestone appealed. After review of the record, the Alabama Supreme Court determined the trial court erred in denying Bridgestone's motion to compel arbitration pursuant to the terms of the EDR Plan. Accordingly, the trial court’s judgment was reversed and the case remanded for further proceedings. View "Bridgestone Americas Tire Operations, LLC v. Adams" on Justia Law

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Bridgestone Americas Tire Operations, LLC, d/b/a GCR Tires & Service ("Bridgestone"), appealed a circuit court order denying Bridgestone's motion to compel arbitration of an employment-related dispute. Ottis Adams began working as a sales representative for Bridgestone or a related entity in May 2006 and that he resigned or his employment was terminated in August 2016. At some point at or around the time he was hired, Adams signed a document entitled "New Employee Agreement and Acknowledgment of the Bridgestone/Firestone, Inc. Employee Dispute Resolution Plan" ("the agreement"), which stated that Adams agreed to the terms of the employee-dispute-resolution plan, fully titled, the "BFS Retail & Commercial Operations, LLC, Employee Dispute Resolution Plan" ("the EDR Plan"). The EDR Plan contained an arbitration provision. After leaving Bridgestone in 2016, Adams went to work for McGriff Tire Company, Inc. ("McGriff"). At some point thereafter, McGriff's principal, Barry McGriff, received a letter written on the letterhead of Bridgestone's corporate parent, asserting that Adams signed a noncompetition and nonsolicitation agreement with his previous employer, that his employment with McGriff violated that agreement, and that Adams allegedly had violated a duty of loyalty by selling tires for McGriff while still employed by Bridgestone. The letter also suggested that Adams may have disclosed, or might disclose, "confidential information and trade secrets." The letter stated that Bridgestone was planning to commence legal action against Adams and concluded with a suggestion that McGriff might be named as a defendant in that action if the matter was not resolved. Adams asserts that, because of the accusations in the letter, McGriff terminated his employment. Adams sued Bridgestone and related entities, alleging Bridgestone interfered with his business relationship with McGriff and had defamed him via the letter to Barry McGriff. Adams subsequently voluntarily dismissed all defendants except Bridgestone. Bridgestone filed an answer and a counterclaim. In its counterclaim, Bridgestone averred that Adams, while still employed by Bridgestone, had taken actions for McGriff's benefit and had "feigned acceptance" of an employment agreement he never actually signed that included a noncompetition provision. Although Bridgestone did not mention arbitration or the EDR Plan in its answer or counterclaim, approximately three months after filing those pleadings, it amended its answer to assert arbitration as a defense, and it filed a motion to compel arbitration of all claims pursuant to the terms of the EDR Plan. The trial court denied Bridgestone's motion to compel, and Bridgestone appealed. After review of the record, the Alabama Supreme Court determined the trial court erred in denying Bridgestone's motion to compel arbitration pursuant to the terms of the EDR Plan. Accordingly, the trial court’s judgment was reversed and the case remanded for further proceedings. View "Bridgestone Americas Tire Operations, LLC v. Adams" on Justia Law

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A party waives any right to object to the validity of an arbitration provision calling for the arbitration of certain claims once that party agrees to arbitrate those claims. Here, the parties settled the claims made the basis of case no. CV-2015-900849 by agreeing to arbitrate any further disputes regarding alleged violations of the Hillwood Office Center Owners' Association, Inc.’s ("the HOCOA"), governing documents. Following the dismissal of case no. CV-2015- 900849, Carol Blevins continued to assert violations of the governing documents and made a demand for arbitration. The HOCOA and its board members agreed to the submission of Carol's claims to arbitration. Although the HOCOA and its board members did object to certain issues being submitted to the arbitrator for determination, arguing that those issues instead should be determined by the trial court, they did not object to the submission of the claims to arbitration. The HOCOA and its board members agreed upon two different arbitrators and also sought the enforcement of the settlement agreement containing the arbitration provision by initiating case no. CV-2015- 901891. Accordingly, The Alabama Supreme Court concluded that because the HOCOA and its board members agreed to the submission of the claims raised in this matter to the now pending arbitration proceeding, they waived their right to object to the validity of the arbitration provision. The appeal in case no. CV-2015-900849 was dismissed. To the extent that the HOCOA and its board members appealed the trial court's order dissolving the stay of arbitration in case no. CV-2015-901891, that order was affirmed. Finally, the order appealed from case no. CV-2016- 901627 was affirmed in part and reversed in part and the case was remanded to the trial court for further proceedings. View "Hillwood Office Center Owners' Association, Inc., et al. v. Blevins" on Justia Law

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STV One Nineteen Senior Living, LLC ("STV"), appealed a circuit court order denying its motion to compel arbitration of certain counterclaims filed against it by Dixie Boyd, by and through her agent, Mary Alice Boyd-Kline, under a valid power of attorney. Dixie Boyd and Mary-Alice Boyd-Kline, as holder of Boyd's power of attorney, signed a "residency agreement" with STV, which operated an assisted-living facility. STV agreed to provide Dixie Boyd with a private apartment and other related services, including, among other things, utilities, housekeeping, laundry, meals, maintenance, planned activities, transportation, and security and protection. The residency agreement contained an arbitration clause. The Alabama Supreme Court determined the plain language of the arbitration clause encompassed Boyd's counterclaims, and the trial court erred, therefore, in denying STV's motion to compel arbitration. View "STV One Nineteen Senior Living, LLC v. Boyd" on Justia Law

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Candy Parkhurst ("Parkhurst"), personal representative of the estate of her husband, Andrew P. Parkhurst ("Andrew"), deceased, file suit to compel Carter C. Norvell and Parkhurst & Norvell, an accounting firm Norvell had operated as a partnership with Andrew ("the partnership"), to arbitrate a dispute regarding the dissolution of the partnership. Pursuant to an arbitration provision in a dissolution agreement Norvell and Andrew had executed before Andrew's death, the trial court ultimately ordered arbitration and stayed further proceedings until arbitration was complete. Subsequently, however, Parkhurst moved the trial court to lift the stay and to enter a partial summary judgment resolving certain aspects of the dispute in her favor. After the trial court lifted the stay and scheduled a hearing on Parkhurst's motion, Norvell and the partnership appealed, arguing that the trial court was effectively failing to enforce the terms of a valid arbitration agreement in violation of the Federal Arbitration Act. The Alabama Supreme Court determined there was no evidence in the record indicating that Norvell made such an agreement and he, in fact, denied doing so. In the absence of any evidence that would establish such an agreement, as well as any other evidence that would conclusively establish that Norvell clearly and unequivocally expressed an intent to waive his right to have the arbitrator resolve this dispute. As such, Parkhurst failed to meet her burden of showing that the arbitration provision in the dissolution agreement should not have been enforced. Accordingly, the trial court erred by lifting the arbitral stay in order to consider Parkhurst's motion for a partial summary judgment, and its judgment doing so was reversed and remanded. View "Norvell v. Parkhurst" on Justia Law

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At issue in this appeal were denials of motions to compel arbitration filed by Locklear Chrysler Jeep Dodge, LLC ("Locklear CJD"), and Locklear Automotive Group, Inc. ("Locklear Group"), in actions filed by plaintiffs who alleged they were victims of identity theft resulting from personal information they had provided Locklear CJD in order to explore the possibility of financing the purchase of a vehicle from Locklear CJD. In case no. 1160435, the Alabama Supreme Court affirmed the trial court order denying the motion to compel arbitration; in the other appeals, the Court reversed the trial court's orders and remanded for further proceedings. Plaintiffs in these cases purchased vehicles from Locklear CJD. All the plaintiffs signed an arbitration agreement as part of their vehicle purchases; the operative language of those arbitration agreements was the same. And all the plaintiffs alleged that they were the victims of identity theft that resulted from providing personal information to Locklear CJD when they filled out credit applications for the vehicle purchases. With respect to Case 1160435, the Supreme Court determined that on the face of the arbitration agreement, its terms did not apply to the interaction of the Lollars and the defendants that occurred in 2015. The Lollars purchased their vehicle in 2013; vehicle purchase to which the 2013 arbitration agreement referred and related was one transaction. The Lollars' 2015 visit to the dealership for the purpose of exploring whether to enter into an entirely different transaction with Locklear CJD (and their provision of financial information to Locklear CJD during that visit) was an unrelated matter to which the arbitration clause did not apply. View "Locklear Chrysler Jeep Dodge, LLC v. Hood" on Justia Law