Precision Gear Co. v. Continental Motors, Inc.
135 So. 3d 953
Ala.2013Background
- 2005: Aircraft crash in Ada, Oklahoma killed three; plaintiffs sued in Alabama (Womack litigation), alleging a defective crankshaft gear. Defendants included Cessna, Teledyne Continental (Continental Motors), Tulsair Beechcraft, Precision Gear, and General Metal Heat Treating.
- All defendants in the Womack litigation settled; Continental Motors paid ~ $4.97M defending/settling.
- Tulsair sued Continental in Alabama seeking Oklahoma statutory indemnity; Continental then filed third-party indemnity claims against Precision Gear and General Metal to recover its defense/settlement costs.
- Gear manufacturers moved to dismiss as time‑barred under Alabama’s two‑year tort statute of limitations for noncontractual indemnity; Continental argued Oklahoma treats indemnity as quasi‑contract and thus Alabama’s six‑year contract limitation applies.
- Trial court applied Oklahoma substantive law (because the injury occurred in Oklahoma) but concluded Alabama procedural law governs limitations and, because Oklahoma treats indemnity as quasi‑contract, applied Alabama’s six‑year contract statute — denying dismissal.
- Gear manufacturers obtained permission to appeal under Rule 5, and the Alabama Supreme Court reviewed whether Alabama’s two‑year tort limitations period or the six‑year contract period applied.
Issues
| Issue | Plaintiff's Argument (Continental) | Defendant's Argument (Gear Mfrs.) | Held |
|---|---|---|---|
| Which Alabama statute of limitations applies to Continental’s third‑party indemnity claims? | Oklahoma substantive law governs and characterizes indemnity as quasi‑contract → apply Alabama’s 6‑year contract limitations period. | The forum (Alabama) characterizes the claim for limitations purposes; Alabama treats noncontractual indemnity as tort → apply Alabama’s 2‑year tort limitations period. | Alabama law controls characterization for limitations purposes; indemnity is a tort under Alabama law → 2‑year statute applies; Continental’s claims are time‑barred. |
Key Cases Cited
- Ex parte Liberty Nat’l Life Ins. Co., 825 So.2d 758 (Ala. 2002) (standards for Rule 5 permissive appeals)
- BE&K, Inc. v. Baker, 875 So.2d 1185 (Ala. 2003) (appellate review limited to certified question)
- Lifestar Response of Ala., Inc. v. Admiral Ins. Co., 17 So.3d 200 (Ala. 2009) (lex loci delicti governs substantive tort rights)
- Etheredge v. Genie Indus., Inc., 632 So.2d 1324 (Ala. 1994) (statutes of limitations generally procedural; forum law applies unless limitation is ‘‘inextricably bound up’’ with substantive right)
- Amerada Hess Corp. v. Owens‑Coming Fiberglass Corp., 627 So.2d 367 (Ala. 1993) (Alabama treats noncontractual indemnity as restitution‑based/tort)
- O’Neal v. Kennamer, 958 F.2d 1044 (11th Cir. 1992) (forum law characterizes claim for conflict‑of‑laws purposes)
- General Motors Corp. v. Nat’l Auto Radiator Mfg. Co., 694 F.2d 1050 (6th Cir. 1982) (many courts apply law of place of underlying injury to indemnity/contribution claims)
- Porter v. Norton‑Stuart Pontiac‑Cadillac of Enid, 405 P.2d 109 (Okla. 1965) (Oklahoma treats indemnity as implied or quasi‑contract)
- Booker v. Sears Roebuck & Co., 785 P.2d 297 (Okla. 1989) (noncontractual duty to indemnify characterized as quasi‑contract under Oklahoma law)
