180 So. 3d 860
Ala.2015Background
- Waste Two Energy, LLC (Waste Two) obtained services from Tractor & Equipment Co., Inc. (TEC) after submitting a credit application/agreement listing James Money and Kenneth R. Adams as owners; the agreement contained a guaranty clause with handwritten names for guarantors.
- TEC performed services March–July 2011; a billing dispute arose and Waste Two sued TEC for breach and misrepresentation; TEC counterclaimed against Waste Two and filed a third-party complaint against Money and Adams alleging breach of the guaranty.
- TEC moved for summary judgment showing unpaid balances; Adams (third-party defendant) submitted affidavits denying he signed the guaranty and argued the guaranty violated the Statute of Frauds.
- The trial court denied a dismissal motion (which, because affidavits were considered, converted to summary-judgment treatment) and entered partial summary judgment for TEC on the guaranty claim against Adams.
- Adams filed post-judgment motions asserting: (1) genuine factual dispute whether he signed the guaranty, and (2) Statute of Frauds defects (no subscription by him; lack of written consideration). The trial court denied relief and entered final judgment; Adams appealed.
Issues
| Issue | Plaintiff's Argument (Adams) | Defendant's Argument (TEC) | Held |
|---|---|---|---|
| Whether the guaranty violates the Statute of Frauds because the signature was not subscribed by the party to be charged | Adams: handwritten/printed name is not his subscription and thus fails § 8-9-2 | TEC: defense was waived for failure to plead; complaint and attached agreement show a handwritten name | Court: Statute-of-Frauds defense not established on the face of complaint; waiver rules discussed; summary judgment not reversed on Statute-of-Frauds ground |
| Whether the guaranty is unenforceable for lack of expressed consideration | Adams: guaranty contains no written statement of consideration as required by Statute of Frauds | TEC: defense not timely raised and therefore waived | Court: Adams raised this argument only post-judgment and failed to show trial court erred in not considering it |
| Whether Adams created a genuine issue of material fact about whether he signed the guaranty | Adams: submitted affidavits denying signing and supporting testimony (Money’s deposition) showing the handwriting is not his | TEC: initial attorney statements in filings admitted execution; attorney acts bind client; Adams’s affidavit is conclusory or contradicted | Court: attorney’s unverified statements in response to summary judgment are not evidence; Adams’s sworn affidavit was properly before the court and created a genuine issue of fact; summary judgment reversed as to Adams |
| Whether the trial court properly treated the motion-to-dismiss material and affidavits | Adams: affidavits should have prevented summary judgment; conversion to summary judgment permitted consideration of the affidavits | TEC: motion to dismiss was defective and arguments untimely | Court: because the court considered extraneous materials, the motion converted to summary judgment; affidavits were properly considered |
Key Cases Cited
- Van Hoof v. Van Hoof, 997 So.2d 278 (Ala. 2007) (standard of review for summary judgment and burden-shifting principles)
- Turner v. Westhampton Court, L.L.C., 903 So.2d 82 (Ala. 2004) (prima facie showing and review standard for summary judgment)
- Bass v. SouthTrust Bank of Baldwin County, 538 So.2d 794 (Ala. 1989) (nonmovant’s burden to produce substantial evidence once movant makes prima facie showing)
- Wallace v. Alabama Ass'n of Classified Sch. Emps., 463 So.2d 135 (Ala. 1984) (Rule 8(c) affirmative-defense pleading and exceptions to waiver)
- Phillips v. Am-South Bank, 833 So.2d 29 (Ala. 2002) (conversion of motion to dismiss to summary judgment when court considers extraneous material)
- Simmons Mach. Co. v. M & M Brokerage, Inc., 409 So.2d 743 (Ala. 1981) (partial summary judgments may be revised before final judgment under Rule 54(b))