Andy Sumblin v. Zachary Ward, as administrator of the Estate of Keith Ward (Appeal from Coffee Circuit Court: CV-19-900012).

Rel: July 19, 2024

Notice: This opinion is subject to formal revision before publication in the advance sheets of Southern Reporter.

Readers are requested to notify the Reporter of Decisions, Alabama Appellate Courts, 300 Dexter Avenue,

Montgomery, Alabama 36104-3741 ((334) 229-0650), of any typographical or other errors, in order that corrections

may be made before the opinion is published in Southern Reporter.

ALABAMA COURT OF CIVIL APPEALS

SPECIAL TERM, 2024

_________________________

CL-2023-0197

_________________________

Andy Sumblin

v.

Zachary Ward, as administrator of the Estate of Keith Ward

Appeal from Coffee Circuit Court

(CV-19-900012)

LEWIS, Judge.

Andy Sumblin appeals from a judgment entered by the Coffee

Circuit Court ("the trial court") in favor of Zachary Ward, as

administrator of the Estate of Keith Ward ("the Estate"). We reverse the

judgment and remand this cause with instructions.

CL-2023-0197

Procedural History

On February 20, 2019, Sumblin d/b/a M.O.D. Sod ("Sumblin"), filed

a complaint seeking to collect a debt allegedly owed by Keith Ward d/b/a

Ward Lawn Care ("Ward"). After Ward failed to answer the complaint,

Sumblin filed, on April 11, 2019, a motion seeking an entry of default and

a default judgment. On August 21, 2019, Sumblin filed a summary-

judgment motion. On September 12, 2019, the trial court entered a

judgment; that judgment was amended on that same day. In its final

form, the judgment provided, in pertinent part:

"This matter came before the Court on the Motion for

Entry of Default and for Default Judgment filed by [Sumblin]

on April 11, 2019…. Having considered the Motion and all

matters brought before the Court and for good cause shown,

it is hereby ORDERED ADJUDGED and DECREED as

follows:

"1. The Motion for entry of default is GRANTED.

"2. The Motion for default judgment is GRANTED and a

final default judgment is ENTERED in favor of … Sumblin

and against … Ward in the amount of Thirteen Thousand Two

Hundred Forty-Three and 74/100 Dollars ($13,243.74), plus

costs."

(Capitalization in original.)

Over two years later, on January 6, 2022, "the Estate of Keith

Ward" filed a motion seeking to vacate the trial court's judgment

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pursuant to Rule 60(b)(6), Ala. R. Civ. P., along with exhibits in support

of the motion. On March 24, 2022, Sumblin filed a response in opposition

to the Rule 60(b)(6) motion and moved the trial court to strike the

exhibits attached thereto. On March 25, 2022, the Estate responded to

Sumblin's March 24, 2022, filing.

After a hearing on March 29, 2022, the trial court entered an order

on April 6, 2022, vacating the September 12, 2019, judgment. On April

15, 2023, Sumblin filed a suggestion of the death of Ward and a motion

requesting that the Estate be substituted as the defendant. That motion

was granted on April 18, 2022. An answer to the complaint was

thereafter filed on September 14, 2022. After a trial, the trial court

entered a judgment on February 17, 2023, providing:

"This matter came before the Court for bench trial on

[Sumblin's] complaint seeking damages for an unpaid debt

owed by Defendant Ward Lawn Care and Defendant Ward.

Upon considering the evidence[,] the Court awarded damages

to [Sumblin] in the amount of $12,091.39.

"[Sumblin] sought damages for an unpaid debt of

$8,594.95, plus interest[,] attorney fees, and court costs.

Because the evidence showed [Ward] was likely incompetent

beginning in November 2017, the Court declined to award

damages for interest accrued past December 2017.

"The evidence showed … Ward … owned and operated a

lawn care business, Ward's Lawn Care. [Sumblin's] business

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records indicated [Ward] purchased sod for several years and

routinely paid the bill after an invoice was sent to [Ward].

During late 2017, [Ward] became delinquent on paying his

bill. [Sumblin] mailed [Ward] several invoices and a letter

demanding payment. Despite the debt owed, [Ward] did not

respond to the letter and [Sumblin] continued to sell sod to

[Ward]. [Sumblin] filed suit and [Ward] failed to answer. A

default judgment was entered against [Ward] but was later

set aside after the Court learned [Ward] had become stricken

with brain cancer and had died. The evidence showed [Ward]

likely lacked sound mental capacity after he underwent two

surgeries to remove a brain tumor. Testimony showed [Ward]

began experiencing symptoms of confusion, memory loss, and

paralysis during the same time he uncharacteristically failed

to pay his bills. Because the evidence showed [Ward's] mental

capacity began to fail in November 2017, the Court finds

[Ward] should not be liable for interest accrued after

December 2017.

"[Sumblin] requested the … [E]state be liable for the

unpaid debt. The evidence showed [Ward] purchased sod on

behalf of his business, 'Ward's Lawn Care.' [Ward] paid for the

sod using checks labeled with the company’s name[,] 'Ward's

Lawn Care.' [Sumblin] provided business records showing

that 'Ward's Lawn Care' owed the debt. [Sumblin's] sod farm

manager testified [Ward] purchased sod at the reduced

merchant rate because he owned and operated a landscape

company, 'Ward's Lawn Care.' Finally, the [Estate] provided

evidence showing [Ward] had properly registered the lawn

care business, 'Ward's Lawn Care' with the Alabama

Secretary of State.

"Alabama appellate courts have held that 'permitting

the piercing of the corporate veil is not a power that is lightly

exercised. The concept that a corporation is a legal entity

existing separate and apart from its shareholders is well

settled in this state.' Co-Ex Plastics, Inc. v. AlaPak, Inc., 536

So. 2d 37 (Ala. 1988). Alorna Coat Corp. v. Behr, 408 So. 2d

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496 (Ala. 1981). The Courts have established that 'the

corporate veil may be pierced where a corporation is set up as

a subterfuge, where shareholders do not observe the corporate

form, where the legal requirements of corporate law are not

complied with, where the corporation maintains no corporate

records, where the corporation maintains no corporate bank

account, where the corporation has no employees, where

corporate and personal funds are intermingled and corporate

funds are used for personal purposes, or where an individual

drains funds from the corporation.' See, e.g., Forester & Jerue,

Inc. v. Daniels, 409 So. 2d 830 (Ala. 1982); Hamrick v. First

National Bank of Stevenson, 518 So. 2d 1242 (Ala. 1987);

Deupree v. Ruffino, 505 So. 2d 1218 (Ala.1987); Messick v.

Moring, 514 So. 2d 892 (Ala. 1987); East End Memorial

Association v. Egerman, 514 So. 2d 38 (Ala. 1987).

"While the Court recognizes [Sumblin] is owed a

significant unpaid debt, this Court is reluctant to create the

slippery slope precedent of piercing the corporate veil based

on the evidence presented in this case. Upon consideration of

the foregoing, it is ORDERED, ADJUDGED, and DECREED:

"1. The Court finds in favor of [Sumblin] and against

Defendant Ward's Lawn Care.

"2. [Sumblin] is awarded damages in the amount of

$12,091.39. (The total damages were calculated as follows:

$8,594.95 unpaid debt: plus $388.92 in finance charges

through December 2017; plus $412.36 court costs: plus

$2,695.16 attorney fee calculated by figuring 30% of unpaid

debt.)

"3. The Court denies [Sumblin's] request to find …Ward

or his estate individually liable."

"4. Any other relief sought and not granted herein is denied."

(Capitalization in original.)

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Sumblin timely filed his notice of appeal to this court on March 30,

2023.

Discussion

I. Order Setting Aside the Default Judgment

On appeal, Sumblin first argues that the trial court erred by

granting the Rule 60(b)(6) motion to set aside the default judgment. The

Estate argues that, because Sumblin did not file a petition for a writ of

mandamus from the order granting the Rule 60(b)(6) motion, he may not

challenge that order on appeal. We note, however, that our supreme

court has explained:

"[O]rdinarily 'interlocutory orders merge with final

judgments' and, therefore, most interlocutory orders may be

appealed once a final judgment is entered. McCormack v.

AmSouth Bank, N.A., 759 So. 2d 538, 541 (Ala. 1999). See also

Barnes v. George, 569 So. 2d 382, 383 (Ala. 1990) (allowing

challenge to grant of Rule 60(b)(2) motion for new trial after

judgment in the new trial)."

Caton v. City of Pelham, 329 So. 3d 5, 19 (Ala. 2020); see also R.E. Grills,

Inc. v. Davison, 641 So. 2d 225, 227 (Ala. 1994) ("[U]nless in the

circumstances of the case a petition for a writ of mandamus is the only

procedure available to secure relief, a party does not waive a right to

appeal from a trial court's interlocutory order or ruling solely by not filing

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such a petition."). Therefore, we will proceed to address the merits of

Sumblin's argument.

Sumblin specifically argues that the Estate failed to meet its

burden of introducing arguments and evidence of all three factors set

forth in Kirtland v. Fort Morgan Authority Sewer Service, Inc., 524 So.

2d 600 (Ala. 1988). See Sampson v. Cansler, 726 So. 2d 632, 633 (Ala.

1998) (explaining that, "[a]lthough Kirtland involved a Rule 55(c)[,Ala.

R. Civ. P.] motion to set aside a default judgment, [the supreme court]

also appl[ies] the Kirtland analysis to Rule 60(b)[, Ala. R. Civ. P.] motions

to set aside default judgments").

In Kirtland, our supreme court set forth the following mandatory

factors that a trial court must consider when ruling on a motion to set

aside a default judgment: "1) whether the defendant has a meritorious

defense; 2) whether the plaintiff will be unfairly prejudiced if the default

judgment is set aside; and 3) whether the default judgment was a result

of the defendant's own culpable conduct." Kirtland, 524 So. 2d at 605;

see also Sampson v. Cansler, 726 So. 2d 632, 633 (Ala. 1998). Sumblin

initially focuses on whether the Estate showed the presence of a

meritorious defense.

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With respect to a party's burden of proving the Kirtland factors,

particularly proving a meritorious defense, our supreme court has

explained:

" '[T]he trial court has broad discretion ... in

deciding whether to deny or to grant a motion to

set aside a default judgment. In exercising that

discretion, the trial court must apply the three-

factor analysis set forth in Kirtland. However, the

law is well settled that " ' "in order to trigger the

mandatory requirement that the trial court

consider the Kirtland factors, the party filing a

motion to set aside a default judgment must allege

and provide arguments and evidence regarding all

three of the Kirtland factors." ' " Hilyer v. Fortier,

176 So. 3d 809, 813-14 (Ala. 2015) (quoting D.B. v.

D.G., 141 So. 3d 1066, 1071 (Ala. Civ. App. 2013),

quoting in turn Brantley v. Glover, 84 So. 3d 77,

81 (Ala. Civ. App. 2011)).

" ' … It is well settled that bare legal

conclusions unsupported by affidavit or other

evidence do not suffice to demonstrate a

meritorious defense under Kirtland. See Martin v.

Robbins, 628 So. 2d 614, 617-18 (Ala. 1993) (noting

that "[a] defaulting party has satisfactorily made

a showing of a meritorious defense if the

allegations in an answer or in a motion and its

supporting affidavits, if proven at trial, would

constitute a complete defense to the claims against

the defaulting party or if sufficient evidence has

been adduced either by affidavit or by some other

means to warrant submitting the case to the

jury"); see also Royal Ins. Co. of America v. Crowne

Invs., Inc., 903 So. 2d 802, 808 (Ala. 2004) (noting

that "[t]he existence of a meritorious defense is a

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'threshold prerequisite,' Kirtland, 524 So. 2d at

605, because without a meritorious defense, a

finding that the plaintiff would not be prejudiced

and a finding that the defendant was not culpable

would matter little"). …

" '….

" 'With regard to a meritorious defense in the

context of a Kirtland analysis, this Court has

stated:

" ' "[A] defaulting party has

satisfactorily made a showing of a

meritorious defense when allegations

in an answer or in a motion to set aside

the default judgment and its

supporting affidavits, if proven at trial,

would constitute a complete defense to

the action, or when sufficient evidence

has been adduced either by way of

affidavit or by some other means to

warrant submission of the case to the

jury....

" ' "The allegations set forth in the

answer and in the motion must be more

than mere bare legal conclusions

without factual support; they must

counter the cause of action averred in

the complaint with specificity --

namely, by setting forth relevant legal

grounds substantiated by a credible

factual basis. Such allegations would

constitute a 'plausible' defense."

" 'Kirtland, 524 So. 2d at 606 (emphasis added).'

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" 'Carroll[ v. Williams], 6 So. 3d [463,] 467-68 [Ala. 2008)].' "

Ex parte Bhones, 285 So. 3d 740, 745-46 (Ala. 2019) (quoting Ex parte

Ward, 264 So. 3d 52, 56 (Ala. 2018)); see also Appalachian Stove &

Fabricators, Inc. v. Roberts, 544 So. 2d 893, 897 (Ala. 1989) (holding that,

"[t]o show the existence of a meritorious defense, [the defendant] had to

allege sufficient facts or produce enough evidence to counter the

plaintiffs' claims").

Here, the Estate offered no evidence of a meritorious defense.

Instead, the Estate simply argued that Sumblin did not present "any

evidence of [Ward's] alleged debt except [Sumblin's] own sworn affidavit"

and that Sumblin had not presented "invoices or delivery receipts

indicating any unpaid balance by [Ward]." However, the Estate did not

argue that Sumblin's testimony was somehow insufficient to establish

Sumblin's case.1 Moreover, the Estate did not allege the existence of any

facts that would contradict Sumblin's testimony that "if proven at trial,

would constitute a complete defense to the action, or [that] sufficient

1Indeed, our supreme court has recognized testimony as adequate,

even without documentary evidence, to prove a case seeking

compensation "for work and labor done and materials furnished."

Loggins v. Robinson, 738 So. 2d 1268, 1269 (Ala. Civ. App. 1999).

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evidence ha[d] been adduced either by way of affidavit or by some other

means to warrant submission of the case to the jury." Kirtland, 524 So.

2d at 606. Therefore, we conclude that the Estate failed to meet the

burden of proving the existence of the first Kirtland factor.

Our supreme court has explained that, when a defendant fails to

satisfy the initial burden of alleging and demonstrating the existence of

all the Kirtland factors, the trial court exceeds its discretion in setting

aside the default judgment. Bhones, 285 So. 3d at 747. In this case,

though, even though the motion to set aside the default judgment stated

that it was filed pursuant to Rule 60(b)(6), because the motion relied on

the allegation that Ward was incompetent, we construe the motion as

relying on Rule 60(b)(4), Ala. R. Civ. P. See, e.g., Pharo v. Pharo, 199 So.

3d 93, 95 n.1 (Ala. Civ. App. 2015) (construing "allegations made in the

motion and the statements in the accompanying affidavit as challenging

service by publication, and, thus, seeking relief under Rule 60(b)(4)[, Ala.

R. Civ. P.,]" because "an appellate court ' "looks to the essence of a motion,

rather than its title, to determine how that motion is to be considered

under [the] rules [of civil procedure]." ' ") (quoting Ex parte Alfa Mut. Gen.

Ins. Co., 684 So. 2d 1281, 1282 (Ala. 1996), quoting in turn Union Springs

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Tel. Co. v. Green, 285 Ala. 114, 117, 229 So. 2d 503, 505 (1969)); and

Keith v. Moone, 771 So. 2d 1014, 1017 (Ala. Civ. App. 1997), rev'd on

other grounds, Ex parte Keith, 771 So. 2d 1018 (Ala. 1998) (holding that

"[a] default judgment entered against an incompetent person is void; a

void judgment may be vacated at any time."). This court has held that a

party seeking relief pursuant to Rule 60(b)(4) is not required to make a

showing with respect to the Kirtland factors. Pharo, 199 So. 3d at 95. 2

Therefore, we decline to reverse the trial court for failure of proof with

respect to the Kirtland factors.3

2It appears that a majority of the justices of our supreme court are

of the opinion that the consideration of the Kirtland factors is not

appropriate where relief from a default judgment is available under Rule

60(b)(4) because of a lack of due process. See Cornelius v. Browning, 85

So. 3d 954, 958 (Ala. 2011). We note, though, that then-Justice Parker

concurred in the result of the Cornelius opinion, writing that he would

apply the Kirtland factors in analyzing that case. See Cornelius, 85 So.

3d at 962 (Parker, J., concurring the result). "This court is bound by the

decisions of the Alabama Supreme Court." State Farm Mut. Auto. Ins.

Co. v. Carlton, 867 So. 2d 320, 325 (Ala. Civ. App. 2001).

3With respect to the sufficiency of the evidence concerning

competency, although Sumblin briefly asserts that Ward did not prove

incompetency, Sumblin does not make a sufficient argument supported

by legal authority. See Rule 28(a)(10), Ala. R. App. P. Therefore, we will

not address that argument.

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II. The Final Judgment

We next turn to Sumblin's arguments with respect to the final

judgment. Because the trial court made specific findings of fact, we may

review the arguments relating to the sufficiency of the evidence, even

though Sumblin did not file a postjudgment motion challenging the

sufficiency of the evidence. See Adams v. Adams, 21 So. 3d 1247, 1253-

54 (Ala. Civ. App. 2009).

A. Amount of Interest

Sumblin's first argument with respect to the final judgment is that

the trial court erred in determining that no interest should accrue after

November 2017, which was when the trial court concluded that Ward's

incompetency commenced. Sumblin specifically argues that the trial

court erred in determining that interest does not accrue during the time

a party is incompetent. We note, however, that Sumblin's argument on

this point is a legal argument that was not raised to the trial court.

Therefore, it is not preserved for this court's review. See, e.g., Ex parte

Knox, 201 So. 3d 1213, 1218 (Ala. 2015) (holding that a new legal

question may not be considered for the first time on appeal) and Andrews

v. Merritt Oil Co., 612 So. 2d 409, 410 (Ala. 1992) (holding that an

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appellate court "cannot consider arguments raised for the first time on

appeal; rather, [its] review is restricted to the evidence and arguments

considered by the trial court"). Our supreme court has recently

explained:

" '[An appellate court] cannot consider arguments advanced

for the purpose of reversing the judgment of a trial court when

those arguments were never presented to the trial court ....'

State Farm Mut. Auto. Ins. Co. v. Motley, 909 So. 2d 806, 821

(Ala. 2005). When a postjudgment motion is the only

mechanism for bringing an alleged error to the circuit court's

attention … the alleged error must be raised in a

postjudgment motion. Lay v. Destafino, [Ms. 1210383, Feb.

17, 2023] ___ So. 3d ___, ___ (Ala. 2023) ('While it is true that

postjudgment motions under Rule 59(e)[, Ala. R. Civ. P.,] are

usually elective rather than mandatory, such a motion is

necessary to preserve an objection for appellate review when

-- as here -- that motion is the only possible mechanism for

bringing the alleged error to the trial court's attention.')."

Edwards v. Crowder, [Ms. SC-2023-0151, May 24, 2024] ___ So. 3d ___,

___ (Ala. 2024).

In the present case, Sumblin requested an award of interest, and

the trial court partially granted that request, but the trial court limited

the amount of interest awarded, specifically determining that interest

did not accrue during the time that Ward was found to have been

incompetent. Sumblin did not challenge the trial court's legal

determination by arguing that Ward's incompetency was not a valid basis

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for limiting the award of interest. Because it appears from the record

that Sumblin did not become aware that the trial court intended to limit

the interest award due to the finding of incompetency until the entry of

the trial court's judgment, a postjudgment motion was " 'the only possible

mechanism for bringing the alleged error to the trial court's attention.' "

Edwards, ___ So. 3d at ___ (quoting Destafino, ___ So. 3d at ___); see also

Docen v. Docen, 294 So. 3d 767, 771 (Ala. Civ. App. 2019) (holding that,

although the appellant "first learned the basis for the child-support

award when he received the order ruling on his postjudgment motion,"

he was required to file a second postjudgment motion to preserve his

challenge to the trial court's alleged error on that point). Because, like

in Edwards, Sumblin failed to bring the trial court's attention to its

alleged error regarding the limitation of interest due to incompetency, we

conclude that the error was not preserved for this court's review.

Sumblin also makes a brief argument that the trial court erred in

determining the date of Ward's incompetency. He asserts that the

November 2017 date conflicts with the administrator's admission that

the incompetency began in November 2018. We note, however, that,

upon being asked when Ward became incompetent, Zachary Ward

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testified "Probably late 2017 is when you could recognize problems and

things started going south up to the first surgery." Because there was,

in fact, testimony in support of the 2017 date, we cannot conclude that

Sumblin has shown error on this point.

B. Costs of Collection

Sumblin's next argument concerns the award of attorney's fees as

a cost of collection.4 In this case, Sumblin claimed an award of reasonable

attorney's fees pursuant to a contract. Sumblin presented an itemized

statement of his attorney's fees as well as testimony concerning the

reasonableness of the charges. In its judgment, however, the trial court

awarded a fee in the amount of 30% of the debt without reference to the

statement of fees and testimony concerning the reasonableness of the

charges. Sumblin argues that the trial court's disregard for the evidence

presented concerning the reasonableness of the attorney's fees is

reversible error.

4We construe Sumblin's argument as challenging the sufficiency of

the evidence to support the award of an attorney fee. Because the trial

court made a specific finding of fact with respect to the attorney-fee

award, no postjudgment motion was necessary to preserve the issue of

the sufficiency of the evidence. See, e.g., Ex parte James, 764 So. 2d 557,

559 (Ala. 1999).

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Our supreme court has explained that, in determining an attorney

fee award, a trial court should consider the following 12 factors:

" '(1) the nature and subject matter of the employment; (2) the

learning, skill, and labor requisite to its proper discharge; (3)

the time consumed; (4) the professional experience and

reputation of the attorney; (5) the weight of the attorney's

responsibility; (6) the measure of success achieved; (7) the

reasonable expenses incurred by the attorney; (8) whether the

fee is fixed or contingent; (9) the nature and length of a

professional relationship; (10) the fee customarily charged in

the locality for similar legal services; (11) the likelihood that

a particular employment may preclude other employment;

and (12) the time limitations imposed by the client or by the

circumstances.' "

Carver v. Foster, 928 So. 2d 1017, 1025 (Ala. 2005) (quoting Irons v. Le

Sueur, 487 So. 2d 1352, 1359 (Ala. 1986)). Our supreme court further

explained in Carver that "the reasonableness of an attorney-fee award

cannot be based solely on an arbitrary percentage of that value. The fee

must bear a reasonable relationship to the time expended on the case, in

light of the hourly rate of attorneys practicing in the community."

Carver, 928 So. 2d at 1026-27.

Here, it appears that the trial court disregarded the evidence

presented concerning a reasonable attorney's fee and, instead, based the

fee solely on an arbitrary percentage of the amount of the debt.

Therefore, we reverse the trial court's determination of the attorney's fee

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and remand this cause for the trial court to reconsider its attorney-fee

award in light of the 12 factors set forth in Carver.

C. Determination of the Judgment Debtor

Sumblin also argues that the trial court erred in entering a

judgment against a corporation named Ward Lawn Care, Inc.,5 when

Sumblin did not sue Ward Lawn Care, Inc., but, instead, sued Ward.

Sumblin points out that he presented evidence that he had conducted

business with Ward, doing business as Ward Lawn Care. Multiple checks

written to Sumblin indicated that they were drawn on the account of

Ward, doing business as Ward Lawn Care. Sumblin correctly asserts

that the Estate presented no evidence that Ward ever represented to

Sumblin that he was an agent of a corporate entity called Ward Lawn

Care, Inc.

This court has explained:

"Agency is a question of fact and is, therefore, subject to

the ore tenus rule, which gives a presumption of correctness

to the trial court's findings of fact. Crews v. Herman Maisel &

Co., 524 So. 2d 980 (Ala. 1988). We will not disturb a judgment

based on those findings unless they are palpably wrong,

5Although the trial court stated the judgment was entered against

"Ward's Lawn Care," not "Ward's Lawn Care, Inc.," considering the

entirety of the judgment, it is clear that the judgment was entered

against Ward's Lawn Care, Inc.

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unsupported by credible evidence, or manifestly unjust.

Crews, supra.

"The general rule relative to an agency relationship is

that when an agent, acting within his or her real or apparent

authority, enters a contract on behalf of his or her principal,

only the principal is bound by the contract and subject to suit

thereon. Knox v. Moore, 475 So. 2d 1199 (Ala. Civ. App. 1985);

Davis v. Childers, 381 So. 2d 200 (Ala. Civ. App. 1979). An

exception to that rule which is also well settled, however, is

that an agent who enters a contract on behalf of an

undisclosed principal is liable on the contract if he or she fails

to disclose the identity of the principal at the time of making

the contract. Knox v. Moore, supra; B & M Homes, Inc. v.

Hogan, 376 So. 2d 667 (Ala. 1979).

"The critical inquiry in determining whether the

principal … was disclosed for the purpose of avoiding personal

liability of the purported agent … was whether, at the time of

the agreement, [the other party to the contract] had such

notice of the corporation's existence and of its identity that he

knew, would have had reason to know, or should have known

that [the purported agent] was not contracting as an

individual. Hilburn v. Fletcher Oil Co., 495 So. 2d 613 (Ala.

1986)."

Pate v. T-Square, Inc., 545 So. 2d 70, 71 (Ala. Civ. App. 1989).

In Pate, this court affirmed the DeKalb Circuit Court's finding that

the plaintiff had no notice that Pate, a purported agent of D & R Coal Co.,

Inc., was acting as an agent for that corporation. This court noted that

the plaintiff "testified that he made an agreement with [the purported

agent], not a corporation." Moreover, "Pate [did] not contend that he told

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[the plaintiff] that he was acting as the president of D & R Coal Co., Inc.,

but insists that [the plaintiff's] knowledge that he did business as 'D & R

Coal Company' was sufficient to deem his principal disclosed." Id. This

court rejected the purported agent's argument, stating: "The mere fact

that an individual operates a business under a trade name carries no

implication of agency." Id.

In this case, Sumblin presented evidence that he had conducted

business with Ward, doing business as Ward Lawn Care. Multiple checks

written to Sumblin indicated that they were drawn on the account of

Ward, doing business as Ward Lawn Care. Zachary Ward, the

administrator of the Estate, admitted that he had seen no checks

presented that indicated that they were drawn on a corporate account.

There was no evidence indicating that Sumblin ever contracted with

Ward Lawn Care, Inc. Instead, the entirety of the evidence indicated

that Sumblin contracted with Ward, doing business as Ward Lawn Care.

As stated, "[t]he mere fact that an individual operates a business under

a trade name carries no implication of agency." Pate, 545 So. 2d at 71.

Because the undisputed evidence indicated that Ward never represented

to Sumblin that he was an agent of Ward Lawn Care, Inc., the trial court

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erred in declining to hold the Estate liable for the debts accrued by Ward

individually.

Conclusion

Based on the foregoing, we reverse the trial court's judgment and

remand this cause for the trial court to enter a judgment in accordance

with this opinion.

REVERSED AND REMANDED WITH INSTRUCTIONS.

Moore, P.J., and Hanson and Fridy, JJ., concur.

Edwards, J., concurs in the result in part and dissents in part, with

opinion.

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EDWARDS, Judge, concurring in the result in part and dissenting in

part.

Although I do not agree with all of the statements in the main

opinion, I generally agree with the conclusions reached by that opinion

regarding the propriety of the April 6, 2022, order entered by the Coffee

Circuit Court ("the trial court") setting aside that court's September 12,

2019, judgment against Keith Ward d/b/a Ward's Lawn Care ("Ward")

pursuant to Rule 60(b)(4), Ala. R. Civ. P., based on Ward's incompetency

at the time the judgment was entered, see Rule 55(b)(2), Ala. R. Civ. P.

("[B]ut no judgment by default shall be entered (A) against a minor or (B)

against an incompetent person, unless the minor or the incompetent

person is represented in the action by a general guardian or other

representative as provided in Rule 17(c)[, Ala. R. Civ. P.,] who has

appeared therein."); regarding the trial court's erroneously entering a

judgment against the formerly incorporated entity, Ward's Lawn Care,

Inc., instead of against Ward's estate; and regarding the trial court's

award of an attorney's fee to Andy Sumblin based on a percentage of the

debt recovered instead of determining a reasonable fee, see, e.g., Lolley

v. Citizens Bank, 494 So. 2d 19, 19 (Ala. 1986) (explaining that, when a

contract provides for the recovery of a reasonable attorney's fee, a trial

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court should consider evidence relating to a reasonable attorney fee and

not award a percentage of the contract recovery). Thus, I concur in the

result of those aspects of the main opinion.

I cannot, however, agree with the conclusion reached by the main

opinion that Sumblin is precluded from arguing that the trial court erred

by failing to award him 18% interest per annum on the debt owed

pursuant to the terms of the contracts between him and Ward, and I

dissent as to that aspect of the opinion. Sumblin had argued to the trial

court that the invoices evidencing the sale of sod to Ward, which were

contracts between him and Ward, entitled him to 18% interest per annum

on past-due amounts as reflected in his trial exhibit. The trial court

awarded Sumblin the interest that he contended had accrued through

December 2017 based on the trial court's determination that Ward should

not be required to pay interest after the date he became incompetent. On

appeal, Sumblin challenges the trial court's decision to remit the interest

due under the contract based on Ward's incompetency.

The main opinion declines to entertain Sumblin's argument that

the trial court should not have remitted the amount of interest provided

for in the contract on the basis that his argument "is a legal argument

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that was not raised to the trial court." ___ So. 3d at ___. However, the

rule requiring the preservation of error prevents this court from

" 'put[ting] a trial court in error for failing to consider a matter which,

according to the record, was not presented to, nor decided by it.' " Nichols

v. Pate, 54 So. 3d 398, 403 (Ala. Civ. App. 2010) (quoting Rodriguez-

Ramos v. J. Thomas Williams, Jr., M.D., P.C., 580 So. 2d 1326, 1328 (Ala.

1991)) (emphasis added). In my opinion, the issue of Sumblin's

entitlement to 18% per annum in interest per the contract was squarely

presented to and decided by the trial court when the trial court

specifically rejected Sumblin's request that, pursuant to the contract, he

be awarded 18% interest on the past-due amounts and, instead, awarded

him the requested amount of interest only through December 2017.

Sumblin was not required to reargue the legal point of his entitlement to

18% interest per annum under the contract to the trial court in order to

preserve error.

Rule 4(a)(3), Ala. R. App. P., provides that "[a]ny error or ground of

reversal or modification of a judgment or order which was asserted in the

trial court may be asserted on appeal without regard to whether such

error or ground has been raised by motion in the trial court under Rule

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52(b) or Rule 59 of the [Alabama Rules of Civil Procedure]." The

Committee Comments to Rule 4 state that

"The provision of subdivision (a)(3) in the last sentence

permitting assertion in the appellate court of any matter

raised or asserted in the trial court whether such matter was

raised by motion for new trial under [Ala. R. Civ. P.,] Rule

59[,] or for motion of amendment of findings of fact under [Ala.

R. Civ. P.,] Rule 52(b)[,] is a departure from existing Alabama

practice. The rule does not, however, extend the right to raise

for the first time on appeal new matter not presented to the

trial court or upon which the trial court had no opportunity to

pass.

"The requirement retains the practice that matters

raised on appeal must have been presented to the trial court

at some stage. Thus matters which can only be raised by post-

trial motion must be so asserted. The provision is intended to

avoid the necessity of repeated assertions of the same point

below. Once ruled on by the trial court in some form, the point

is preserved for review on appeal."

(Emphasis added.) See also Robertson v. Gaddy Elec. & Plumbing, LLC,

53 So. 3d 75, 80 (Ala. 2012) (overruling Carter v. Treadway Trucking,

Inc., 611 So. 2d 1024 (Ala. 1992), and explaining that Carter was based

on "the false premise that the trial court cannot be held in error for a

matter not presented to it when the trial court there, in granting a

directed verdict, did decide the issue" (emphasis added)); Kirya v. Bulls,

404 So. 2d 58 (Ala. Civ. App. 1981) (explaining that the appellant could

challenge the striking of her affirmative defense to the appellee's

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counterclaim on appeal despite the fact that he had not raised that issue

in a postjudgment motion).

Unlike the main opinion, I do not believe that the sub-issue of

whether the trial court had a legal basis for suspending the accrual of

interest must have been specifically argued by Sumblin in a

postjudgment motion. That sub-issue was injected into the proceeding

by the trial court itself, and the issue whether the accrual of interest

could be suspended because of Ward's incompetency was clearly decided

against Sumblin, who had already argued that he was entitled to the

entire amount of interest that had accrued. See Robertson, 53 So. 3d at

80. Moreover, it seems hyper technical and illogical to me that, in cases

tried without a jury, an appellant is not required to file a postjudgment

motion to preserve an issue regarding the sufficiency of the evidence if

the trial court makes written findings of fact, see New Props., L.L.C. v.

Stewart, 905 So. 2d 797, 800 (Ala. 2004) (explaining Rule 52(b), Ala. R.

Civ. P.), but is required to file one to preserve an error of law even if the

trial court states its legal conclusions in its judgment. 6 To insist that

6In Ex parte Vaughn, 495 So. 2d 83, 87 (Ala. 1986), our supreme

court explained the rationale behind the rule that a postjudgment motion

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Sumblin file a postjudgment motion to argue to the trial court again that

he was entitled to 18% per annum per the contract under the applicable

law -- which is the only argument that he could have made, because no

exception of the type the trial court appears to have imposed exists --

violates the principles espoused in the Committee Comments to Rule 4.

Furthermore, it appears to frustrate the purpose of the Alabama Rules of

Appellate Procedure, which, according to Rule 1, is to "assure the just,

is not required to preserve an argument regarding the sufficiency of the

evidence when a trial court makes written findings of fact, stating:

"[B]y making written findings of fact, the trial judge has had

the additional opportunity to reconsider the evidence and

discover and correct any error in judgment which he or she

may have made upon initial review. Thus, when written

findings of fact are made, they serve the same useful purpose

as does an objection to the trial court's findings, a motion to

amend them, a motion for a new trial, and a motion to dismiss

under Rule 41(b)[, Ala. R. Civ. P.] -- to permit the trial judge

an opportunity to carefully review the evidence and to perfect

the issues for review on appeal."

I do not see why the trial court's determination that Ward became

incompetent in late 2017 and the apparent legal conclusion flowing from

that finding -- that his incompetency permitted the trial court to remit

the interest accrued after the date of Ward's becoming incompetent --

would require Sumblin to point out that incompetency of a debtor is not

relevant to the calculation of interest due under the contract, to which

Sumblin had established his entitlement.

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speedy, and inexpensive determination of every appellate proceeding on

its merits."

As Sumblin contends, he is entitled to the interest set out in the

contract that the trial court found to have existed between Sumblin and

Ward. See Arnold v. Hyundai Motor Mfg. Alabama, LLC, 292 So. 3d

1042, 1053-54 (Ala. 2019) (reversing a judgment that failed to award,

among other things, prejudgment interest and requiring that the trial

court, on remand, award, among other things, the prejudgment interest

to which the plaintiff was entitled pursuant to the contract between the

plaintiff and the defendant); Knight v. Hired Hand Green, Inc., 775 So.

2d 218 (Ala. Civ. App. 1999) ("Because the trial court correctly found in

favor of Hired Hand [Green, Inc.,] on its contract claim, Hired Hand was

necessarily entitled to an award of interest on the past-due balance …

pursuant to the clear terms of the contract."). The trial court did not

provide authority, and I am unaware of any, for the proposition that

interest on a past-due amount as provided for in a contract may be

remitted based on the later-occurring incompetency of a party to that

contract. Thus, I would also reverse the judgment of the trial court

insofar as it remitted the interest that Sumblin is due under the contract.

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