Rel: 8/15/14
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SUPREME COURT OF ALABAMA
SPECIAL TERM, 2014
____________________
1121380
____________________
Andrew J. Gentry III
v.
Daniel L. Lindsey, Sr., et al.
Appeal from Lee Circuit Court
(CV-11-0188)
BRYAN, Justice.
Andrew J. Gentry III ("Drew Gentry") appeals the Lee
Circuit Court's judgment dismissing his claims against Daniel
Lindsey, Sr., Jackson Thornton & Co., P.C. ("Jackson
Thornton"), Daniel Lindsey, Jr., Justin M. Parnell ("Matt
Parnell"), Parnell & Crum, and Wilbur Investments, LLC
1121380
("Wilbur Investments"). For the reasons set forth herein, we
conclude that the Rule 54(b) certification was improper, and
we dismiss the appeal.
Facts and Procedural History
In 1992, Andrew J. Gentry, Jr. ("Andy Gentry"),
petitioned for bankruptcy, pursuant to Chapter 11 of the
Bankruptcy Code. Andy Gentry hired Charles N. Parnell III
("Nick Parnell"), an attorney at Parnell & Crum, to represent
him in the bankruptcy proceedings. Nick Parnell hired Daniel
Lindsey, Sr., a certified public accountant with Jackson
Thornton, to assist him. According to Drew Gentry, who is
Andy Gentry's son, Andy Gentry suffered throughout his life
from a mental illness, which, Drew Gentry argues, was not
controllable by medication at the time of the bankruptcy
proceedings. Drew Gentry argues that, at the time of the
bankruptcy proceedings, Nick Parnell and Daniel Lindsey, Sr.,
knew of Andy Gentry's reduced mental capacity and also knew
that Andy Gentry was terminally ill with AIDS. Andy Gentry
died in 1995, while the bankruptcy proceedings were pending.
During the bankruptcy proceedings and prior to Andy
Gentry's death, Nick Parnell and Daniel Lindsey, Sr.,
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incorporated LeeCo Properties, Inc. ("LeeCo"), in the names of
their minor sons, Matt Parnell and Daniel Lindsey, Jr. Nick
Parnell and Daniel Lindsey, Sr., persuaded Andy Gentry and the
bankruptcy court to allow the transfer of certain real estate
owned by Andy Gentry to LeeCo in return for either payment of
the debts owed on those properties or the assumption of those
debts.
The bankruptcy proceedings terminated in 1997. In 2010,
Nick Parnell and Matt Parnell acquired the interests of Daniel
Lindsey, Sr., and Daniel Lindsey, Jr., in LeeCo. LeeCo's
assets were later transferred to Wilbur Investments, and LeeCo
was dissolved in December 2010. Drew Gentry argues that
neither he nor the bankruptcy court received notice of the
transfer of assets from LeeCo to Wilbur Investments.
In April 2011, Michael Kent, who had had some business
dealings with Andy Gentry, sued Nick Parnell and LeeCo,
alleging claims related to Nick Parnell's conduct during and
after his representation of Andy Gentry in the bankruptcy
proceedings. In May 2011, Kent moved to add Drew Gentry as a
"second-party plaintiff," arguing that the defendants had
inflicted substantial harm upon the Gentry family and that
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"[t]he interests of justice and the interests of judicial
economy [would] be served" by adding Drew Gentry as a
plaintiff.
Drew Gentry was added as a party to the action on June 2,
2011, and, on that same day, he filed a complaint against Nick
Parnell, LeeCo, Parnell & Crum, and various fictitiously named
parties, alleging claims of breach of fiduciary duty and fraud
against Nick Parnell, of conspiracy to defraud against Nick
Parnell, LeeCo, and fictitiously named defendants, and of
negligence against Nick Parnell and Parnell & Crum. Drew
Gentry also requested "that the assets of the defendants be
impressed with a constructive trust in favor of ... Drew
Gentry. Specifically, that the Defendants be judicially
restrained from continuing to convert the monthly rents from
the Mexican Restaurant presently known as 'Cancun' to the
Defendants' own use and benefit." Kent's claims were
eventually dismissed on Kent's own motion, and Drew Gentry
remains the only plaintiff in the underlying action.
On June 23, 2011, Nick Parnell and Parnell & Crum moved
to have Drew Gentry's complaint dismissed.1 After a hearing,
1
Nick Parnell and Parnell & Crum noted in their motion to
dismiss that LeeCo was not included in that motion because it
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the circuit court entered an order on November 2, 2011,
denying the motion to dismiss as to the breach-of-fiduciary-
duty claim and the request for a constructive trust and
granting the motion as to the fraud, conspiracy, and
negligence claims. The circuit court determined that the
fraud, conspiracy, and negligence claims were governed by the
Alabama Legal Services Liability Act, § 6-5-570 et seq., Ala.
Code 1975 ("the ALSLA"), because they were related to Nick
Parnell's representation of Andy Gentry during the bankruptcy
proceedings. The circuit court went on to find that those
claims would not form a basis for an action by Drew Gentry
and, in the alternative, would be barred by the applicable
statute of limitations.
Drew Gentry moved the circuit court to alter, amend, or
vacate the November 2 order as to the fraud and conspiracy
claims only. He argued that, in order to conclude that those
claims were governed by the ALSLA, the circuit court had to
find that Nick Parnell was acting at all relevant times in his
capacity as a lawyer for Andy Gentry as opposed to his
capacity as an officer of LeeCo. Drew Gentry argued that this
had been dissolved in December 2010. LeeCo was later
dismissed from the action by consent of the parties.
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finding was based on facts that had not yet been established
and that Alabama law allows for recovery by a nonclient for
harm caused "by a fraud directed at [a] client" by the
client's attorney.
In May 2012, Drew Gentry amended his complaint, adding as
defendants Wilbur Investments, Daniel Lindsey, Sr., Matt
Parnell, Daniel Lindsey, Jr., and Jackson Thornton. He also
amended his conspiracy claims to include allegations against
the newly added defendants as well as Nick Parnell and added
new claims of unjust enrichment and violation of the Racketeer
Influenced and Corrupt Organizations Act ("RICO") against Nick
Parnell and the newly added defendants. He also added claims
of negligence and willful and wanton misconduct against Nick
Parnell. Parnell & Crum was not listed as a defendant in the
amended complaint.
Nick Parnell, Matt Parnell, and Wilbur Investments moved
the circuit court to dismiss the amended complaint. Daniel
Lindsey, Jr., filed a separate motion to dismiss the amended
complaint. Daniel Lindsey, Sr., and Jackson Thornton
(collectively referred to as "the Jackson Thornton
defendants") also filed a motion to dismiss the amended
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complaint. The defendants argued, among other things, that
the amended complaint failed to state a claim upon which
relief can be granted because, they asserted, the claims did
not survive Andy Gentry's death, the claims were barred by the
statutes of limitations, and Drew Gentry did not have standing
to bring the claims. Drew Gentry opposed those motions. The
defendants filed various motions in reply to Drew Gentry's
opposition.
In August 2012, the circuit court held a hearing on the
motions to dismiss the amended complaint and, in February
2013, entered an order granting those motions ("the February
2013 order"). The circuit court found that dismissal based on
statute-of-limitations grounds was "inappropriate at [that]
time" because "it [could not] be said as a matter of law that
the statutes should not be tolled due to [Drew Gentry's]
incompetency."2 The circuit court went on to find, however,
that "the claims expressed in the First Amended Complaint
[did] not survive the death of Andy Gentry and that [Drew
2
Drew Gentry argued that, like his father, he suffered
from a mental illness, which, he says, should have tolled the
statutes of limitations on his claims.
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Gentry] lack[ed] standing to bring them." The circuit court
concluded:
"In sum, the First Amended Complaint makes
allegations which could conceivably be brought by
Andy Gentry or the estate of Andy Gentry. It does
not appear that any of the claims contained in the
First Amended Complaint can be asserted by Drew
Gentry. ...
"For the foregoing reasons, the Court finds that
[Drew] Gentry's First Amended Complaint is due to be
and is hereby DISMISSED."
The Jackson Thornton defendants, Daniel Lindsey, Jr., and
the Parnell defendants (comprising Nick Parnell, Matt Parnell,
Parnell & Crum, and Wilbur Investments) moved the circuit
court to make its February 2013 order a final judgment,
pursuant to Rule 54(b), Ala. R. Civ. P. Drew Gentry
"conditional[ly] assent[ed]" to the Rule 54(b) motions,
arguing that he "ha[d] no objection to the February [2013]
order being made final" but only after he had had time to
file, and the circuit court had had time to consider, a motion
to alter, amend, or vacate the February 2013 order. He filed
a motion to alter, amend, or vacate the order on March 7,
2013. He later amended that motion to add additional
authority in support of his arguments. Daniel Lindsey, Jr.,
and the Jackson Thornton defendants separately responded to
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the motion to alter, amend, or vacate, and the Parnell
defendants adopted their arguments.
The circuit court denied Drew Gentry's motion and, on
March 20, 2013, entered a certification, pursuant to Rule
54(b), making final the dismissal of the claims against Daniel
Lindsey, Jr., the Jackson Thornton defendants, Matt Parnell,
Parnell & Crum, and Wilbur Investments. The circuit court did
not make final the dismissal of the claims in the amended
complaint against Nick Parnell, presumably because claims
remained pending against him in the original complaint.
Drew Gentry appealed the circuit court's judgment to the
Court of Civil Appeals. In August 2013, the Court of Civil
Appeals transferred the appeal to this Court, citing a lack of
subject-matter jurisdiction. Daniel Lindsey, Jr., and Nick
Parnell separately moved this Court to dismiss them from the
appeal. Daniel Lindsey, Jr., argued that Drew Gentry had not
listed him on the notice of appeal and that the notice of
appeal did not "give[] any indication of an intent to appeal
the judgment in favor of [Daniel] Lindsey, Jr." Nick Parnell
argued that claims remained pending against him in the circuit
court, that "there ha[d] been no final judgment against him,"
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and that "the [circuit] court's [March 20 judgment] did not
include him." This Court denied the motion filed by Daniel
Lindsey, Jr., but granted Nick Parnell's motion and dismissed
him from the appeal.
Discussion
Drew Gentry raises several issues that, he argues, this
Court must address on appeal. However, we cannot consider the
merits of his arguments because the circuit court's Rule 54(b)
certification was improper and, thus, Drew Gentry's appeal is
due to be dismissed. See generally Fuller v. Birmingham-
Jefferson Cnty. Transit Auth., [Ms. 1090436, December 20,
2013] ___ So. 3d ___, ___ (Ala. 2013) (concluding that "the
trial court's certification of finality under Rule 54(b) is
ineffective, and, there being no final judgment, both the
appeal and cross-appeal are dismissed for lack of
jurisdiction").
This Court recently stated in Grant v. Breland Homes,
LLC, [Ms. 1121405, June 13, 2014] ___ So. 3d ___, ___ (Ala.
2014):
"'With respect to the finality of
judgments adjudicating fewer than all
claims in a case, Rule 54(b), Ala. R. Civ.
P., provides:
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"'"When more than one claim for
relief is presented in an action,
... or when multiple parties are
involved, the court may direct
the entry of a final judgment as
to one or more but fewer than all
of the claims or parties only
upon an express determination
that there is no just reason for
delay and upon an express
direction for the entry of
judgment. ... [I]n the absence of
such determination and direction,
any order or other form of
decision, however designated,
which adjudicates fewer than all
the claims or the rights and
liabilities of fewer than all the
parties shall not terminate the
action as to any of the claims or
parties, and the order or other
form of decision is subject to
revision at any time before the
entry of judgment adjudicating
all the claims and the rights and
liabilities of all the parties."
"'"If a trial court certifies a
judgment as final pursuant to Rule 54(b),
an appeal will generally lie from that
judgment." Baugus v. City of Florence, 968
So. 2d 529, 531 (Ala. 2007) (emphasis
added). However, this Court will not
consider an appeal from a judgment
certified as final under Rule 54(b) if it
determines that the trial court exceeded
its discretion in concluding that there is
"no just reason for delay." Rule 54(b);
see also Scrushy v. Tucker, 955 So. 2d 988,
996 (Ala. 2006) ("Whether there was 'no
just reason for delay' is an inquiry
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committed to the sound discretion of the
trial court, and, as to that issue, we must
determine whether the trial court exceeded
its discretion.").
"'A trial court exceeds its discretion
in determining that there is "no just
reason for delay" when "the issues in the
claim being certified and a claim that will
remain pending in the trial court '"are so
closely intertwined that separate
adjudication would pose an unreasonable
risk of inconsistent results."'" Schlarb
v. Lee, 955 So. 2d 418, 419–20 (Ala. 2006)
(quoting Clarke–Mobile Counties Gas Dist.
v. Prior Energy Corp., 834 So. 2d 88, 95
(Ala. 2002), quoting in turn Branch v.
SouthTrust Bank of Dothan, N.A., 514 So. 2d
1373, 1374 (Ala. 1987)). See also
Centennial Assocs., Ltd. v. Guthrie, 20 So.
3d 1277, 1281 (Ala. 2009) ("'It is
uneconomical for an appellate court to
review facts on an appeal following a Rule
54(b) certification that it is likely to be
required to consider again when another
appeal is brought after the [trial] court
renders its decision on the remaining
claims or as to the remaining parties.'"
(quoting 10 Charles Alan Wright et al.,
Federal Practice and Procedure § 2659
(1998))).'
"Loachapoka Water Auth., Inc. v. Water Works Bd. of
Auburn, 74 So. 3d 419, 422-23 (Ala. 2011).
"In Smith v. Slack Alost Development Services of
Alabama, LLC, 32 So. 3d 556 (Ala. 2009), Slack Alost
sued Tony Smith and Albert Weems, alleging breach of
contract for failing to complete their condominium
purchase. Smith & Weems Investments, LLC, was added
as a party because it was the entity named in a
standby letter of credit obtained as part of the
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contract for the purchase of a condominium unit.
Slack Alost moved for a summary judgment against
Weems, but not against Smith or Smith & Weems
Investments. The trial court granted the motion and
certified the summary judgment as final pursuant to
Rule 54(b). Smith and Smith & Weems appealed. On
appeal, this Court held:
"'In the instant case, it is apparent
that at least some of the issues presented
in the still pending claim against Smith
are the same as the issues presented in the
appeal now brought by Smith and Smith &
Weems Investments. Weems and Smith are
business partners accused of breaching the
same real-estate contract, and ... Weems
and Smith have both argued that Slack Alost
never presented them with the original
offering statement or the amended offering
statement for the Bel Sole condominium
development, in violation of § 35–8A–408.
In Centennial Associates, Ltd.[ v. Guthrie,
20 So. 3d 1277 (Ala. 2009,] we stated that
"'[i]t is uneconomical for an appellate
court to review facts on an appeal
following a Rule 54(b) certification that
it is likely to be required to consider
again when another appeal is brought after
the [trial] court renders its decision on
the remaining claims or as to the remaining
parties.'" 20 So. 3d at 1281 (quoting 10
Charles Alan Wright et al., Federal
Practice and Procedure § 2659 (1998)).
Repeated appellate review of the same
underlying facts would be a probability in
this case, and, in light of this Court's
stated policy disfavoring appellate review
in a piecemeal fashion, see Dzwonkowski v.
Sonitrol of Mobile, Inc., 892 So. 2d 354,
363 (Ala. 2004), we accordingly hold that
the trial court exceeded its discretion in
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certifying the judgment entered against
Weems as final pursuant to Rule 54(b).'
"32 So. 3d at 562-63.
"In the present case, review of the nonfinal
summary judgment in favor of Gulf Coast and of the
summary judgment entered in favor of Horton and
Breland that is before this Court on appeal requires
resolution of the same threshold issue: whether Gulf
Coast had authority to approve the construction
applications for lots 13 and 26 in Oak Grove when
the same applications had already been denied by the
ARC. Horton, Breland, and Gulf Coast presented the
same arguments in their summary-judgment motions and
the same defenses to the plaintiffs' claims.
Although the summary judgment in favor of Breland
and Horton is before this Court on appeal, the
summary judgment in favor of Gulf Coast is not.
Because the threshold issue in the judgment before
this Court is identical to the threshold issue in a
claim still pending before the trial court, we
conclude that the claims are '"'"so closely
intertwined that separate adjudication would pose an
unreasonable risk of inconsistent results."'"'
Loachapoka Water Auth., 74 So. 3d at 423 (quoting
Schlarb v. Lee, 955 So. 2d 418, 419-20 (Ala. 2006)).
Further, as in Smith, supra, '[r]epeated appellate
review of the same underlying facts would be a
probability in this case.' 32 So. 3d at 562. Thus,
'in light of this Court's stated policy disfavoring
appellate review in piecemeal fashion,' id. at 562-
63, we conclude that the trial court exceeded its
discretion in determining that there was no just
reason for delay and in certifying as final pursuant
to Rule 54(b) the summary judgment in favor of
Horton and Breland."
As was the case with the claims in Smith v. Slack Alost
Development Services of Alabama, LLC, 32 So. 3d 556 (Ala.
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2009), which was discussed in Grant, "it is apparent that at
least some of the issues presented in the still pending
claim[s] against [Nick Parnell] are the same as the issues
presented in the appeal now brought [against Daniel Lindsey,
Jr., the Jackson Thornton defendants, Matt Parnell, Parnell &
Crum, and Wilbur Investments]." 32 So. 3d at 562. In fact,
all the claims now before us on appeal were also alleged
against Nick Parnell and are based on the same underlying
facts.
Moreover, as in Grant, Nick Parnell and the defendants
before us on appeal presented many of the same arguments in
their motions to dismiss and raised the same defenses to Drew
Gentry's claims. Thus, this Court's review of the nonfinal
dismissal of the claims in the amended complaint against Nick
Parnell in the amended complaint and the dismissal of the
claims against Daniel Lindsey, Jr., the Jackson Thornton
defendants, Matt Parnell, Parnell & Crum, and Wilbur
Investments will "require[] resolution of the same ...
issue[s]." Grant, ___ So. 3d at ___.
We conclude here, as we did in Grant,
"that the claims are '"'"so closely intertwined that
separate adjudication would pose an unreasonable
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risk of inconsistent results."'"' Loachapoka Water
Auth.[, Inc. v. Water Works Bd. of Auburn], 74 So.
3d [419,] 423 [(Ala. 2011)] (quoting Schlarb v. Lee,
955 So. 2d 418, 419-20 (Ala. 2006)). Further, as in
Smith[ v. Slack Alost Development Services of
Alabama, LLC, 32 So. 2d 556 (Ala. 2009)],
'[r]epeated appellate review of the same underlying
facts would be a probability in this case.' 32 So.
3d at 562. Thus, 'in light of this Court's stated
policy disfavoring appellate review in piecemeal
fashion,' id. at 562-63, we conclude that the trial
court exceeded its discretion in determining that
there was no just reason for delay and in certifying
as final pursuant to Rule 54(b) the [dismissal of
Drew Gentry's claims against Daniel Lindsey, Jr.,
the Jackson Thornton defendants, Matt Parnell,
Parnell & Crum, and Wilbur Investments]."
Grant, ___ So. 3d at ___. Because the Rule 54(b)
certification was improper, Drew Gentry's appeal is due to be
dismissed. See Stephens v. Fines Recycling, Inc., 84 So. 3d
867, 879 (Ala. 2011) (holding that the trial court's Rule
54(b) certification was erroneous and concluding that, "[i]n
the absence of a final judgment, this appeal is due to be
dismissed").
APPEAL DISMISSED.
Moore, C.J., and Bolin and Main, JJ., concur.
Murdock, J., concurs in the result.
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