*1 923 Gen., find that district court 785, Accordingly, we Atty. v. 479 F.3d 788 han U.S. Cir.2007) (internal denying Single- (11th its discretion marks abused quotation reconsideration, as omitted). ton’s motion appli- an erroneous was based on decision require- exhaustion cation of the PLRA’s require The PLRA’s exhaustion district court’s de- v. ment. We reverse jurisdictional. ment is not Woodford and remand the motion Singleton’s nial of 101,126 Ngo, 548 U.S. S.Ct. determine (2006) for the district to case it is (stating 368 “clear 165 L.Ed.2d genuine Singleton has raised whether requirement is that the PLRA exhaustion to as whether his issue material fact Instead, jurisdictional”). not exhaustion timely appeal was filed. under the PLRA is an affirmative defense sub to be raised the defendant is AND REMANDED. REVERSED practice. ject procedural to the usual —Bock, -, 127 v. U.S. S.Ct. Jones (2007).
910, 919-21,
While affirmative be from the face may
fense clear 12(b)(6)
pleadings, in which case a Rule ordinarily is appropriate,2
dismissal summary
treat affirmative on defenses
judgment pursuant Rule 56.3 Further
more, establishing burden an affir
mative on the defendant, defense lies plaintiff
on the the district court seems FOUNDATION, The LLOYD NOLAND suggest. Art, e.g., Stamp See Int’l INC., nonprofit an Alabama Serv., v. U.S. Postal 456 F.3d Plaintiff, corporation, (“If (11th Cir.2006) curiam) (per the mov issue, proof ant bears the burden of on an v. because, defendant, as a it is an asserting TENET HEALTHCARE CORPORA- defense, it affirmative must establish that TION, corporation, Defendant-Ap- genuine there no issue fact is of material Party pellant-Third Plaintiff-Coun- defense.”). any element of ter-Defendant, case, beyond this the district court looked pleadings, ap and therefore Rule 56 v. Summary plies. judgment appropri is not genuine ate fact where issue of material City Authority, of Fairfield Healthcare defense. Party exists about affirmative See Third Defendant-Counter- 56(c). Claimant, Fed.R.Civ.P. face, plaintiff allega- If a defense fails to make sufficient show that affirmative bars claim.”). recovery complaint on tions in his such an affirmative face, appears complaint defense on its his pleadings 3. Once "matters outside may subject be under Rule dismissal pursuant presented,” a motion for dismissal Jones, 921; 12(b)(6). 127 S.Ct. at Cottone 12(b)(6) longer appropriate, and "the Jenne, (11th Cir.2003) F.3d one for motion must treated as ("A complaint subject to dismissal under 56.” Fed.R.Civ.P. under Rule 12(b)(6) allegations, Rule when its on their 12(d). *2 Corporation,
HealthSouth Third Susan J. Wagner, Salonimer Forrest Party Defendant-Appellee. Hinton, Jr., Baker, Donelson, Bearman, Berkowitz, PC, & Birmingham, Caldwell
No. 07-14850. AL, for Plaintiff. Appeals, United States Court of Hamilton, Charles K. F. Rogers, Bruce Eleventh Circuit. Bainbridge, Mims, Smith, LLP, Rogers & Birmingham, AL, Party for Third Defen- May 2008. dant-Appellee. BLACK, CARNES, COX,
Before Judges. Circuit PER CURIAM: I. OVERVIEW (“Tenet”) Corporation Healthcare challenges the grant- district court’s order (“Health- ing Corporation South”) summary judgment and dismissing with prejudice Tenet’s third-party com- plaint against HealthSouth.
Carnes, Circuit Judge,
dissenting
filed
II.
opinion.
BACKGROUND
claims,
case
This
involves
counter-
claims, and third-party
arising
claims
out
of a series of transactions related to the
operation
sale and
of a
in Fair-
hospital
field,
1996, Lloyd
Alabama.
In
Noland
(“LNF”)
Foundation,
hospital
sold
deal,
part
Tenet.1 As
LNF re-
an option
repurchase
served
hospital
(“the
beds”)2
beds
LNF
from Tenet and
required
responsi-
Tenet to assume certain
bilities related to a retiree medical dis-
subsidiary
actually purchased
right
A
of Tenet
repurchase
2. LNF reserved the
hospital
right
hospital,
corresponding
beds “and the
but this distinction is not relevant
provide hospital
services
therewith”
from
purposes
appeal.
of this
(R.l-84
H.)
$1.00.
Ex.
(“the
program],
LNF retiree medical discount
LNF
medical
program
count
retiree
1.7(f).
referenced
Schedule
program”).3
discount
¶
Indemnity Provi
Ex. F
City
Healthcare
Fairfield
no expiration
sion contained
date.
(“Fairfield”)
Authority
purchased the hos-
*3
by the
did
the Note
pay
Fairfield
not
pital from Tenet. Fairfield assumed the
Agreement
in the
Re
due date set forth
above that Tenet
obligations described
So, HealthSouth, as
garding Amendment.
(“the
Obligations”).
to LNF
Assumed
owed
Guarantor,
Note in full.
In a
paid the
purchase by
Fairfield financed the
execut-
8, 2001, Tenet ac
January
letter dated
(“the Note”),
Promissory
pay-
ing a
Note
in full”
the Note.
“payment
of
knowledged
15, 2000,
May
to
on or
able
Tenet
before
I).
not
This letter did
men
Ex.
Security Agree-
and Fairfield executed
Indemnity Provision.
tion the
guaran-
Tenet. HealthSouth
ment with
February 16,
LNF sued Tenet
On
teed Fairfield’s
of the Note
in the
District of Alabama for
Northern
through Guaranty
Ten-
Agreement
with
to
damages, alleging
per-
that it had failed
Guaranty Agreement
et. HealthSouth’s
Obligations. On March
form the Assumed
not
agreement.
did
include
HealthSouth,
again ac-
Tenet wrote
pay
Fairfield did
Note when
It
payment of the Note.
sent
knowledging
result,
May
As a
became due.
original
both the
Note
HealthSouth
Tenet, Fairfield,
signed
and HealthSouth
FULL”)
(marked
origi-
and the
“PAID IN
Amendment of
Regarding
nal
Amendment.
Agreement
(“the
Promissory
Agreement
Secured
Note
(R.l-81
J.)
letter,
its cover
Tenet
Ex.
Amendment”).
Regarding
Agreement
The
Indemnity
Provision re-
asserted that
Regarding
gave
Amendment
Fairfield and
May 2, Tenet formal-
mained in effect. On
six
HealthSouth
additional months
ly demanded
from Fairfield and
to
pay
Agreement
which
Note.
Indemnity
to
pursuant
HealthSouth
Regarding Amendment contained
fol- Provision,
agreed
indemnify
but
to
neither
(“the
lowing indemnity provision
Indemni-
So,
LNF’s claims.
Tenet
against
Provision”):
ty
third-party complaint
filed
in the LNF
suit
both Fairfield and Health-
Obligation:
Indemnification
South, claiming
un-
right
Authority
and Guarantor
[Fairfield]
of
der the terms
Provision.
jointly
severally
[HealthSouth] shall
argued
Both Fairfield and HealthSouth
indemnify Payee
any loss,
for
[Tenet]
expired
that the
when
damage, expenses
(including
or costs
at-
the Note in full. Tenet
fees)
torneys
by
Payee
incurred
contended
[LNF],
to any
attributable
claim
remained in effect.
based on acts
a failure to act
Authority
Tenet, Fairfield,
[Fairfield]
Guarantor
and HealthSouth filed
and/or
summary judgment
1999]
after
on Tenet’s
[HealthSouth]
[November
motions for
respect
the “LNF Beds” as such contractual
indemnification claim. The
with
1.7(f)
term is used
Schedule
district
Fairfield’s
granted
summary judg-
Asset
HealthSouth’s motions
[LNF
Sale
and/or
rendered,
up
an annual
threshold
of
3. Tenet assumed the administration
LNF,
$150,000
(R.l-84
program.
LNF retiree medical discount
per program participant.
however,
responsible
H.)
remained
lor reimburs-
Ex.
ing
services
Tenet for
value of
retiree
9, 2004, holding
ment on November
III.
OF
STANDARD
REVIEW
Provision con-
We review a
court’s
an implied expiration
tained
date and ex-
summary judgment
Summary
de novo.
pired when the Note was satisfied.
judgment
appropriate when
evi-
dence,
light
viewed
most favorable
Tenet moved the district court under
nonmoving party, presents
genu-
54(b)
entry
partial
Fed.R.Civ.P.
final
ine issue of
compels
material
fact and
judgment on
summary judgment
or-
a matter of law.
Huff
der.
granted
The district court
Tenet’s
(11th
County,
DeKalb
516 F.3d
motion.
appealed
to this court. We
Cir.2008).
appeal
jurisdic-
dismissed
for lack
*4
April 4,
tion on
there
because
was no
IV. DISCUSSION
judgment”
“final
the district court
54(b).
appeal
certify
presents
This
a matter of con-
properly
could
under Rule
Found.,
interpretation
tract
under Alabama
Lloyd Noland
v.
law.
Inc.
Tenet
law,
Under Alabama
(11th
agree-
Corp.,
Health Care
district court’s HealthSouth’s mo- stated, construing The district court “In summary judgment preju- tion for and its Amendment as third-party dicial dismissal of Tenet’s com- whole, that, finds as a court matter plaint against law, HealthSouth for contractual provision unambiguous indemnification. is to its dura- There no final that could be district to determine whether al- Fairfield, alleged certified because Tenet had leged common this claim Health- law indemnification claim South, which or both. on; court had not ruled we instructed the
927
“A contrac
present
ambiguity.
upon
terms
and expired
tion
if it
rea
ambiguous
provision
at
discern
tual
We
Note.”
one
breathtaking conclu-
to more than
justification
sonably susceptible
for this
itself, by
fact,
the district court
Supply,
sion.
FabArc Steel
meaning.”
opinion,
seemed
be wa-
the end
its
Sys., 914 So.2d
Composite Constr.
remaining
vering
point:
on this
“[T]he
(Ala.2005).
that these
To
extent
357
provisions
Agreement and in other
in the
In
any
present
ambiguity
impliedly
documents ...
establish
Provision,
argues that Ala
demnity
upon
indemnity provision expired
pay-
bama law dictates
(Id.
14) (em-
of the Note....”
ment
fa
be construed
should
added).
phasis
& N.R. Co. v.
See
Cull
vor.
Louisville
date. A termi-
contained no termination
Inc.,
Warehouse,
226 Ala.
man
unambiguously
date
man-
nation
cannot
(“[A]ll
(1933)
fair
doubts
So.
If
dated
silence.
desired
in
party
in favor of the
to be resolved
date,
provide
they
a termination
would demnified.”);
Fidelity and Cas. Ins.
Ala.
unambiguously done so.
have
Bank,
Ala.
Penny Savings
v. Ala.
Co.
*5
(1917) (“[T]he
103,
The district court
stated that
76 So.
107-08
also
con
Indemnity
“curiously
interpretation
Provision was
mute”
that in the
or
rule is
find
“curi-
all
nothing
as to its duration. We
of
of this character
struction
contracts
Indemnity
about the
Provision’s si-
ous”
in
doubts
to be resolved
favor
fair
Indeed,
very
”).
as to
lence
its duration.
Health-
party
indemnified....
for
indemnity provision
common
an
not
South, however,
any ambig
that
contends
an
A
expiration
party
include
date.
could
language
uous
should
construed
bargain
explicit
for
for
expiration
an
date
Tenet, under
doctrine of con
against
indemnity obligation,
clearly
an
but
since Tenet drafted the
preferentum,
tra
happen
not
here.
did
Indemnity
Royal Ins. Co.
Provision. See
Contracting Corp.,
v.
Am. Whitaker
to of
and HealthSouth are referred
(11th Cir.2001)
242 F.3d
1042
“Guarantor,”
“Payee”
respectively,
as
and
(“[ajmbiguous language in an
throughout
against
construed
the draft
agreement is
Amendment. The district court noted
er.”). However,
the Alabama Supreme
Indemnity
Provision’s reference
exception
to this
recognizes
Court
“Payee”
Tenet as
and HealthSouth
parties to a
general rule: “Where both
Indemnity
“Guarantor” indicated that the
sophisticated
per
contract are
business
linked
Note
ex-
Provision was
to the
and
and the contract
by
sons
counsel
advised
pired
paid.
Note
dis-
when the
was
We
negotiations
at arm’s
product
is a
agree;
“Payee”
terms
and “Guaran-
no
length
parties,
we find
merely
used
between
appear
tor”
to have been
And,
automatically
ambigui-
doubt that
these
reason to
construe
convenience.5
we
"the
The dissent asserts that our conclusion that
clusion
in
whole context of
5.
lies
parties
“Payee”
used the terms
and
agreement.”
King Capitol
See
Amusement
simply for
“has no
"Guarantor”
convenience
Co.,
(1930).
222
130
Ala.
So.
record,
elsewhere,” post
in
at
support
or
And,
suggest
that the dissent’s conclusion
reality
nothing
disagree.
We
The
is that
sophisticated parties used the terms
that these
record, except
in
in our
the context which
"Payee”
a back-handed
and "Guarantor”
used, supports
were
either our conclu-
terms
way
to fix a
date for
Indemni-
termination
why
or the dissent’s conclusion as to
sion
extraordinary
ty
conclusion.
Provision is
Support
terms were used.
for our con-
these
ties in the contract
the drafter.”
Agreement
related thereto” that the
Re-
Hamilton,
Sling
Western
& Cable Co. v.
garding
purported
Amendment
to address.
(Ala.1989).
545 So.2d
Both Tenet
Finally,
supports
the district court
sophisticated
and HealthSouth are
that,
holding by pointing out
since the
by
fully
were
advised
counsel. We see
parties agree
that the
clause
no
any ambiguity
reason to construe
(which
Agreement6
the Security
contained
Any ambiguity pre-
HealthSouth’s favor.
date)
explicit
expired
no
termination
upon
“Payee”
by
sented
and “Guar-
Note,
payment
Indemnity
of the
Provi-
antor”
by
is resolved
examination of the
expired
sion must also have
at the same
language
of the
Provision and
(R.2-197
14.)
time.
Security
at
The
its context.
payment
secured
of a
debt
court held that
Indemni-
discharged upon payment
of the Note.
ty
expired upon payment
Provision
of the
It
Security
is not remarkable that
Note because it
“appears
the context of
clause,
Agreement’s indemnity
which relat-
an agreement
six
extend
months the
solely
collateral,
ed
to the
expired
likewise
of ...
duration
the Note.”
payment of
upon
the Note. It is
not
also
dispositive
This is not
of the issue of
remarkable that the
agree
would
whether
Provision survives
Despite
this.
the dissent’s insistence that
Note,
helpful.
nor is it even
believing
sound
“[t]here
reason
presence
that silence about expiration meant one
in a
purporting
document
to amend the
thing
exactly
one
Note
suggest
does
itself
opposite
thing
agreement,”
another
post
to,
was tied
even
*6
expiration
Security
the
of the
the
Indemnity
related to
Note. The
Provi-
Agreement’s indemnity
is simply
clause
sion is found in a
in
separate paragraph
irrelevant to
expiration
the
of the Indemni-
the Agreement Regarding Amendment.
ty Provision.
Indemnity
mention,
The
Provision did not
Note,
modify,
Guaranty
much less
the
argues
law,
that Alabama
ex-
Agreement
Security
or the
Agreement.
pressed
Mining
Black Diamond Coal
And,
Agreement
(Ala.1991),
Regarding Amend-
Corp.,
Co. USX
pay money—that V. CONCLUSION LNF or LNF retiree medical beds the granted improperly It court apparent why is The district program. discount indemnification HealthSouth. The summary judgment from to desired parties.”); King, the 130 So. parties relevant in our the intention of 7. The intent of the is ("It analysis principle the In- the to determine duration of well-settled that at 799 is a McCauley demnity Provision. See Charles II. parties, to which courts seek intention Assocs., Snook, contract, 339 So.2d construing in is to be discover 1976) (Ala. ("Along provisions of with the gathered, particular words and from contract, of the and relations conduct phrases, whole of the but from the context subject may also parties matter agreement.”). construing ascertain the contract to used in judgment dismissing third-party standing beyond Tenet’s that provision would live complaint against preju- HealthSouth with the life of the note extended. These vacated, dice is and the sophisticated parties represented were HealthSouth’s favor is re- sophisticated attorneys engaging in so- versed. phisticated transaction. There at were least half a agreements dozen different
REVERSED.
and documents that were part over- CARNES, dissenting: Circuit all Judge, Certainly parties transaction. attorneys produc- their not shy were about The district court concluded that ing paper. If they had intended the in- indemnity obligation HealthSouth’s that demnity provision to be de-linked from the part was of the note amendment was not extension, six-month note they could have but everlasting, expired instead when accomplished by making separate it a note that it part paid was off. The was Instead, put document. they chose to majority contrary. concludes to the provision agreement into an that would right; majority only last six months. wrong. Finally, provision agreements parties between these case, issue this HealthSouth is referred relating to the sale of hospital contain to as “Guarantor.” specific That term is indemnity provisions. two other One of guarantor to its role as of Fairfield’s obli- them, part the one that was of the asset gation pay off note in favor of Tenet. agreement, sale specified that the indemni- off, paid Once the note was ty obligation in it was last “forever.” guarantor. no longer By using was parties That shows knew how to make term, parties signaled their intent agreement indemnification outlast the the indemnity obligation last would they note when They intended do so. only long as HealthSouth remained the obligation chose to the make that was guarantor. guarantor Once its role as part of the asset sale last “for- the note payments was ever,” over—when but chose obligation not make the six-month expired extension and the note part that was of the note amendment last off—its role as indemnitor was forever. opinion too. The majority over asserts The second of the two other indemnifica- record, any support without else- provisions tion agree- was in the security where, used the provision, ment. That like the note “Payee” “Guarantor” and simply con- us, indemnity provision amendment before contrary, venience. To the if convenience not specify expire. did it was when the parties were motivation could sim- Nonetheless, Tenet conceded in the dis- *8 ply have referred themselves trict court that indemnity provision “HealthSouth” and “Tenet.” The incon- security agreement intended venient truth is that “Guarantor” and expire when note was off. There “Payee” meaning. have no sound believing reason for that si- expiration lence about thing reversing meant one Instead of the district court’s exactly opposite one to Health- thing in agreement. another South, it. should affirm
There is also fact that put indemnity provision
chose to
question into a six-month extension
note, making separate, instead of it a free-