Alabama Insurance Guaranty Ass'n v. Water Works & Sanitary Sewer Board of the City of Montgomery
93 So. 3d 94
Ala.2012Background
- AIGA sued the Board to recover payments AIGA made on Batson’s workers’ compensation claim on the Board’s behalf.
- Circuit court granted the Board summary judgment limiting recovery to payments in the two years before filing and denied attorney fees.
- Court of Civil Appeals reversed, held six-year statute of limitations applied and remanded for damages and fees.
- This Court granted certiorari to decide which statute of limitations applies to AIGA’s reimbursement claim.
- Batson was injured in 2001; Legion insured; Legion insolvent in 2003; Batson’s claim settled in 2003 with AIGA paying $40,000 and future medicals; AIGA had paid $49,135.61 before suit.
- August 2009, AIGA learned Board’s net worth exceeded $25 million, triggering reimbursement rights under the AIGA Act; AIGA sought declaratory judgment for reimbursement and fees; Board argued two-year limitations and constitutionality of provision.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Which statute of limitations governs AIGA’s reimbursement claim | AIGA: six-year period applies | Board: two-year limitations apply | Six-year statute governs the reimbursement claim. |
| Whether AIGA’s reimbursement right is a debt under six-year § 6-2-34(5) | AIGA’s right to recover is a liquidated sum | Right is statutory, not contractual debt | Right to reimbursement falls under six-year debt statute § 6-2-34(5). |
| When the right to reimbursement accrued | Accrues when net-worth information disclosed (Aug. 2009) | Accrues at time of Batson’s payment | Accrued by August 2009 disclosure, not at initial payments. |
| Whether other defenses (voluntary-payment doctrine, constitutionality) barred AIGA’s claim | Voluntary-payment doctrine does not apply; statute governs | Voluntary-payment doctrine and other challenges bar recovery | Not dispositive to the six-year limitations issue; court rejected challenges on summary judgment. |
Key Cases Cited
- Grief v. City of Homewood, 257 Ala. 181 (1952) (debt when statute creates a liability to pay money; six-year limit)
- City of Anniston v. Douglas, 250 Ala. 367 (1948) (liability to pay money; debt proper remedy under six-year limit)
- Strange v. Powell, 15 Ala. 452 (1849) (when statute creates liability to pay money, debt action appropriate)
- Williams v. Deerman, 724 So.2d 18 (Ala.Civ.App.1998) (debt action subject to six-year limitations)
- City of Anniston v. Dempsey, 253 Ala. 597 (1950) (contract-like recovery; six-year limitations)
- Alabama Workmen’s Compensation Self-Insurers Guar. Ass’n, Inc. v. Wilson, 993 So.2d 451 (Ala.Civ.App.2006) (subrogation/insurer-rights context relevant to limitations)