Contributory Doesn’t Nix Subsequent Negligence, Alabama Court Says in UM Case

The Alabama Supreme Court has handed down two decisions that could have an impact on uninsured motorist claim payouts and on how construction surety bonds and contracts are defended.

In MSE Building Co. vs. Stewart/Perry Co., Buc-ee’s Ltd. and Philadelphia Indemnity Insurance Co., the companies relied on the assertion that a staffing firm and a subcontractor were not licensed contractors in a dispute over subpar concrete work. That meant that the work was illegal and the claims for payment on the work were unenforceable, the defendants argued.

The defendant companies also argued that a lien placed by MSE on Buc-ee’s, a convenience store chain, failed because the lien had been transferred to a construction bond by Stewart/Perry, a contractor on the job.

A trial court in Birmingham agreed and entered summary judgment in favor of the defendant companies, essentially dismissing MSE’s claims.

But the high court said an issue of genuine material fact exists over whether the tasks done by laborers supplied by the staffing company were contractor-type jobs covered by state license requirements. The justices reversed that part of the trial court’s decision. The summary judgment on MSE’s lien claim and prompt-payment claim also were reversed. The dismissal of a negligence claim against Buc-ee’s was affirmed.

Also on Friday, Oct. 20, the state Supreme Court upheld a $700,000 jury verdict – which did not levy punitive damages – against State Farm Mutual Automobile Insurance Co.

The case stemmed from a 2016 auto accident in Auburn, Alabama. A car driven at high speed by Mark Stafford T-boned Brian and Jennifer Wood at an intersection, causing permanent injury to Brian. The Woods were unable to serve Stafford with lawsuit papers, and they then sued their own insurer, State Farm, for uninsured motorist benefits.

The jury sided with the Woods. State Farm appealed. The insurance company’s attorneys argued that the trial court erred by allowing a wantonness claim and by giving the jury an instruction on the doctrine of subsequent negligence. Brian Woods was at the intersection in a somewhat “dangerous position,” and Stafford could not have known that, State Farm suggested.

The justices discounted that argument.

“The doctrine of subsequent negligence, also known as the last-clear-chance doctrine, is a method of establishing liability despite a plaintiff’s contributory negligence,” Justice Tommy Bryan wrote in the opinion. “That is, a plaintiff’s contributory negligence is not a defense to a defendant’s subsequent negligence.”

The court also found that State Farm’s argument about the appropriateness of the wantonness claim was without merit.

“Further, there was evidence from which the jury could have concluded that Stafford was made aware of the upcoming intersection by an intersection-crossing warning sign, that Stafford saw that his view of the intersection was initially blocked by a hillcrest, and that Stafford was warned by a traffic sign and road markings that he was driving in a mandatory right-turn lane,” the justices wrote.

State Farm failed to show that the trial court had erred by not setting aside its judgment on the jury’s verdict, “and we affirm the judgment,” the opinion notes.

Topics Alabama