Jerry & John Woods Construction, Inc. v. John David Jordan and Carol S. Jordan (Appeal from Dallas Circuit Court: CV-22-900161).

• Court: Supreme Court of Alabama
• Decided: November 22, 2024
• Docket: SC-2024-0253
• Status: Published

Opinion

Rel: November 22, 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 printed in Southern Reporter.

SUPREME COURT OF ALABAMA OCTOBER TERM, 2024-2025

_________________________

SC-2024-0253 _________________________

Jerry & John Woods Construction, Inc.

v.

John David Jordan and Carol S. Jordan

Appeal from Dallas Circuit Court (CV-22-900161)

COOK, Justice.

In May 2022, Jerry & John Woods Construction, Inc. ("Woods

Construction"), entered into a contract with John David Jordan and Carol

S. Jordan for the construction of a house and a metal building. After the SC-2024-0253

Jordans allegedly failed to pay Woods Construction for the work it had

performed, the company sued them in the Dallas Circuit Court, asserting

claims of breach of contract and unjust enrichment.

The Jordans eventually moved to dismiss the claims against them

or, in the alternative, for a summary judgment in their favor on the basis

that Woods Construction's failure to maintain the required residential-

home-builder's license barred it from bringing civil claims against the

Jordans. The Jordans also asserted counterclaims on the basis that the

work completed by Woods Construction was done improperly and

negligently. Woods Construction opposed the Jordans' motion, asserting

that it was not barred from recovering the cost of constructing the metal

building, which, it argued, is not a residential home.

Following a hearing, the circuit court entered a summary judgment

in favor of the Jordans on Woods Construction's claims after finding that,

under § 34-14A-14(d), Ala. Code 1975, a part of Alabama's Home Builders

Licensure Act ("the Licensure Act"), § 34-14A-1 et seq., Ala. Code 1975,

Woods Construction, as a residential home builder without the proper

license, was barred from bringing a civil action against the Jordans to

enforce the construction contract between them.

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As explained below, although the circuit court certified its judgment

as final pursuant to Rule 54(b), Ala. R. Civ. P., that certification was

improper, and therefore this appeal is due to be dismissed.

Facts and Procedural History

As stated previously, in May 2022, the Jordans entered into a

contact with Woods Construction to construct a house and a metal

building on their property. Per the terms of the contract, the Jordans

agreed to pay Woods Construction $330,000 to build those structures.

According to Woods Construction, the Jordans were required to pay the

company the "first draw of $85,000." Although the Jordans contend that

they paid the first payment, Woods Construction asserts that the Jordans

refused to pay and that, as a result, "the project was put on hold until

payment was made."

In March 2023, Woods Construction commenced this action against

the Jordans, asserting breach-of-contract and unjust-enrichment claims

as a result of the Jordans' alleged failure to make the requested payment.

The company also sought compensatory damages plus any applicable

interest and costs. Woods Construction also filed a "Notice of Lis

Pendens/Lien" in the Dallas Probate Court.

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On July 17, 2023, the Jordans filed a motion to dismiss or, in the

alternative, for a summary judgment. In their motion, the Jordans

asserted that, at the time Woods Construction began building the house

and metal building on their property, the company was not properly

licensed with the Alabama Home Builders Licensure Board ("the Board")

in accordance with § 34-14A-5(a)(1), Ala. Code 1975, which provides that

"[a]ll residential home builders shall be required to be licensed by the

Home Builders Licensure Board annually."

According to the Jordans, because Woods Construction did not have

the requisite license, the company could not maintain its action against

them. See § 34-14A-14(d) (providing that "[a] residential home builder,

who does not have the license required, shall not bring or maintain any

action to enforce the provisions of any contract for residential home

building which he or she entered into in violation of [the Licensure Act]"

(emphasis added)). As a result, the Jordans argued that they were

entitled either to have Woods Construction's claims against them

dismissed or, in the alternative, to a summary judgment in their favor.

In support of their assertions, the Jordans purportedly attached

"Exhibit B" to their motion, which included a copy of § 34-14A-14; the

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affidavit of J.R. Carden, Jr., the Executive Director of the Board; the

Board's investigative file regarding Woods Construction; and an

"Administrative Resolution" from the Board. In the resolution, Woods

Construction admitted that it had engaged in residential construction at

the Jordans' property without a license, in violation of the Licensure Act,

and, thus, agreed to pay a $1,000 fine.

At the same time the Jordans filed their motion, the Jordans also

filed an answer to Woods Construction's complaint, in which they denied

all the allegations against them and repeated their arguments in support

of their motion. They also asserted breach-of-contract and negligence

counterclaims. Specifically, the Jordans alleged that Woods Construction

had breached the contract at issue and had been negligent "by failing to

properly comply with the terms of the contract and by failing to perform

the construction work in a good, proper, and workmanlike manner." They

sought compensatory damages in excess of $250,000.

After the Jordans amended their motion, Woods Construction filed

a brief in opposition to that motion on August 17, 2023. Woods

Construction first argued that it could not properly defend itself against

the arguments made in the Jordans' motion because the primary exhibit

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on which they had relied -- Exhibit B -- was not attached to either their

original or their amended motion. 1 Even so, Woods Construction

attempted to refute the arguments made in the Jordans' motion.

Although Woods Construction acknowledged that it could not sue the

Jordans to recover the costs it had incurred building the Jordans' house

because it lacked the required home-builder's license, it asserted that it

did not need such a license to build the Jordans' metal building and, thus,

could move forward with its action against the Jordans to recover the

costs it had incurred building that structure.

At some point, the circuit court entered an order denying the

Jordans' motion to dismiss but resetting their motion for a summary

judgment for a hearing on December 8, 2023, and that hearing was held.

According to the Jordans, during the hearing, Woods Construction

"requested additional time to respond to the Motion for Summary

1It appears to this Court that Exhibit B was not originally attached

to the Jordans' motion but was, instead, filed with the circuit court after Woods Construction filed its brief in opposition to their motion. We note, however, that that exhibit was available for Woods Construction to consider and review many months before the summary-judgment hearing and before the circuit court entered a summary judgment. It thus appears that Woods Construction could have properly defended itself against the Jordans' motion. 6 SC-2024-0253

Judgment."

Then, on March 4, 2024, the Jordans filed a "Motion for Ruling on

Defendants' Pending Motion for Summary Judgment." The Jordans

argued that their summary-judgment motion was due to be granted

because Woods Construction had acknowledged in the administrative

resolution that it had violated § 34-14A-5(a)(1) and it had not provided

any additional response to the pending motion pursuant to its request at

the summary-judgment hearing.

The circuit court then entered a summary judgment in favor of the

Jordans on Woods Construction's claims against them and declared the

company's "Notice of Lis Pendens/Lien" null and void. In that same order,

the circuit court also made clear that the Jordans' counterclaims against

Woods Construction would remain pending. It further certified its order

as final pursuant to Rule 54(b) after finding that there was no just reason

for delay. Woods Construction appealed.

Standard of Review

In reviewing a circuit court's order certifying its judgment as final

pursuant to Rule 54(b), Ala. R. Civ. P., the standard of review is as

follows:

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" 'Whether the action involves separate claims and whether there is a final decision as to at least one of the claims are questions of law to which we will apply a de novo standard of review. Whether there was "no just reason for delay" is an inquiry committed to the sound discretion of the trial court, and, as to that issue, we must determine whether the trial court exceeded its discretion.' "

Rogers v. Cedar Bluff Volunteer Fire Dep't, 387 So. 3d 131, 135 (Ala.

2023) (quoting Scrushy v. Tucker, 955 So. 2d 988, 996 (Ala. 2006)).

Discussion

Woods Construction raises several arguments on appeal as to why

§ 34-14A-14(d) does not bar it from bringing claims to recover the cost of

constructing the metal building. However, we cannot consider the merits

of its arguments because, as explained below, the circuit court's Rule

54(b) certification was improper and, thus, Woods Construction's appeal

is due to be dismissed.

Although neither party challenges on appeal the appropriateness of

the circuit court's Rule 54(b) certification, it is well settled that this Court

is " ' " duty bound to notice ex mero motu the absence of subject-matter

jurisdiction." ' " Rogers, 387 So. 3d at 135 (quoting Baldwin Cnty. v. Bay

Minette, 854 So. 2d 42, 45 (Ala. 2003), quoting in turn Stamps v.

Jefferson Cnty. Bd. of Educ., 642 So. 2d 941, 945 n.2 (Ala. 1994)).

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"Without subject-matter jurisdiction, this Court has no authority to

consider the merits of an appeal." Id. (citing Loachapoka Water Auth.,

Inc. v. Water Works Bd. of Auburn, 74 So. 3d 419, 422 (Ala. 2011)).

Accordingly, before this Court can reach the merits of any of Woods

Construction's arguments on appeal, we must first determine whether

the circuit court properly certified its summary judgment in favor of the

Jordans as final under Rule 54(b). See Loachapoka, 74 So. 3d at 422.

Generally, a trial court's judgment is not final unless it resolves all

claims against all parties. Cox v. Parrish, 292 So. 3d 312, 315 (Ala. 2019).

Rule 54(b) provides a limited exception to this general rule and states, in

relevant part:

"When more than one claim for relief is presented in an action, whether as a claim, counterclaim, cross-claim, or third-party claim, 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."

Nevertheless, "[b]ecause this Court disfavors piecemeal appellate review,

we have consistently cautioned trial courts that certifications under Rule

54(b) should be entered only in exceptional cases." Cox, 292 So. 3d at 315.

This Court has previously discussed factors to be taken into account

9 SC-2024-0253

when reviewing a judgment certified as final pursuant to Rule 54(b) to

determine whether the trial court exceeded its discretion in finding that

there was "no just reason for delay." For example, in some cases, we have

considered whether " ' 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.' " ' " Rogers, 387 So. 3d at 135-36 (quoting Schlarb v.

Lee, 955 So. 2d 418, 419-20 (Ala. 2006), quoting in turn 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)).

This Court has also considered " 'whether the resolution of claims

that remain pending in the trial court may moot claims presented on

appeal.' " Rogers, 387 So. 3d at 136 (quoting Lighting Fair, Inc. v.

Rosenberg, 63 So. 3d 1256, 1264 (Ala. 2010)). For example, in Lighting

Fair, a dispute arose among certain materialmen, the homeowners, a

construction company, and a bank regarding the alleged failure to pay

for the materials used in a home-construction project. The homeowners

asserted cross-claims against the construction company and the bank.

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Relying on a provision in the construction contract, the trial court ordered

the homeowners to arbitrate their claims against the construction

company. While the arbitration proceeding was pending, the trial court

entered a summary judgment in favor of the bank and the homeowners

on the materialmen's claims and in favor of the bank on the homeowners'

cross-claims. The trial judge certified its summary judgments as final

pursuant to Rule 54(b). This Court concluded that the resolution of the

arbitration proceeding could cause some of the claims at issue on appeal

to become moot. Accordingly, this Court held that the trial court had

erred in certifying its judgments as final and dismissed both appeals.

Our Court has maintained this position in some of our more recent

decisions. See, e.g., Rogers, 387 So. 3d at 136 (holding that, because the

resolution of the appellant's claim against the employee still pending in

trial court could moot the appellant's claim against the employer asserted

under a theory of respondeat superior, the trial court had erred in

certifying its summary judgment in favor of the employer as final); Cox,

292 So. 3d at 316 (holding that, because the resolution of the appellees'

declaratory-judgment claim still pending in trial court could moot the

appellant's counterclaim, the trial court had exceeded its discretion in

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certifying judgment dismissing that counterclaim as final pursuant to

Rule 54(b)).

As stated previously, here, Woods Construction sued the Jordans,

asserting breach-of-contract and unjust-enrichment claims arising out of

the Jordans' alleged failure to pay for work completed by the company.

The Jordans filed two counterclaims against Woods Construction -- one

alleging breach of contract and one alleging negligence -- based on the

company's alleged failure "to properly comply with the terms of the

contract and … to perform the construction work in a good, proper, and

workmanlike manner." According to the Jordans, because Woods

Construction had failed to perform the agreed-upon work in a proficient

manner, their duty to pay under the contract was never triggered.

Thus, both the claims asserted by Woods Construction and the

counterclaims asserted by the Jordans concern the same contract, the

same construction work, and the same buildings on the same real

property. In other words, the factual underpinnings of Woods

Construction's adjudicated claims against the Jordans are the same as

those of the Jordans' unadjudicated counterclaims against Woods

Construction, and, therefore, their claims are "inextricably intertwined"

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with one another. See Fuller v. Birmingham-Jefferson Cnty. Transit

Auth., 147 So. 3d 907, 913 (Ala. 2013) (citing Speigel v. Trustees of Tufts

Coll., 843 F.2d 38, 45 (1st Cir. 1988)) (holding that an appeal from a

judgment certified as final pursuant to Rule 54(b) was not appropriate

when "[t]he factual underpinnings of the adjudicated claims are the same

as those of the unadjudicated counterclaim").

Moreover, as in Lighting Fair, supra, the circuit court's resolution

of the Jordans' counterclaims may moot Woods Construction's arguments

on appeal because, in deciding the Jordans' counterclaims, the circuit

court must determine whether Woods Construction first breached the

contract by improperly constructing the Jordans' house and metal

building. If Woods Construction is found to have breached the contract

by improperly constructing the Jordans' house and metal building, then

Woods Construction would necessarily lose on the merits of its own

claims, arising from its allegation that the Jordans failed to pay for the

potentially faulty construction. As a result, Woods Construction would

have no claims that could potentially be barred by its failure to obtain

the residential-home-builder's license, which is the basis on which the

circuit court entered the summary judgment. In other words, Woods

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Construction's arguments on appeal would be moot and there would be

no need for us to review the circuit court's summary judgment in favor of

the Jordans on the basis that Woods Construction, as a residential-home

builder without the proper license, was barred from bringing a civil action

against the Jordans to enforce the contract.

Because the review of the issues decided by the circuit court on

summary judgment would require this Court to resolve claims that are

potentially moot, we conclude that the circuit court exceeded its

discretion in finding that there was no just reason for delay and in

certifying its judgment as final pursuant to Rule 54(b). Accordingly,

Woods Construction's appeal is due to be dismissed as having been taken

from a nonfinal judgment. Dzwonkowski v. Sonitrol of Mobile, Inc., 892

So. 2d 354, 363 (Ala. 2004) ("A nonfinal judgment will not support an

appeal.").

Conclusion

Because the circuit court's Rule 54(b) certification was improper,

we dismiss the appeal.

APPEAL DISMISSED.

Parker, C.J., and Shaw, Wise, Bryan, Mendheim, Stewart, and

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Mitchell, JJ., concur.

Sellers, J., concurs in the result.