Ex parte Associates Financial Services Co. of Alabama, Inc.

• Decision Date: 22 August 1997
• Citation: 705 So.2d 836
• Parties: Ex parte ASSOCIATES FINANCIAL SERVICES COMPANY OF ALABAMA, INC. (Re Johnnie L. FANIEL, Sr. v. ASSOCIATES FINANCIAL SERVICES COMPANY OF ALABAMA, INC.). 1952073.
• Court: Alabama Supreme Court

Page 836

705 So.2d 836

Ex parte ASSOCIATES FINANCIAL SERVICES COMPANY OF ALABAMA, INC (Re Johnnie L. FANIEL, Sr. v. ASSOCIATES FINANCIAL SERVICES COMPANY OF ALABAMA, INC.).

1952073.

Supreme Court of Alabama.

Aug. 22, 1997.

Rehearing Denied Oct. 24, 1997.

J. Fairley McDonald III and Richard H. Gill of Copeland, Franco, Screws & Gill, P.A., Montgomery; and R. Carlton Smyly of Cabaniss, Johnston, Gardner, Dumas & O'Neal, Birmingham, for petitioner.

Charles A. McCallum III and Charles M. Elmer of Campbell & Waller, L.L.C., Birmingham, for respondent.

SHORES, Justice.

Associates Financial Services Company of Alabama, Inc., the defendant in an action pending in the Greene Circuit Court, petitions for a writ of mandamus directing the trial judge to transfer this case from Greene County to Houston or Bullock County. We deny the writ.

The plaintiff, Johnnie L. Faniel, Sr., filed his initial complaint on May 8, 1996, alleging fraudulent practices on the part of Associates in connection with consumer credit transactions; he alleged that these practices violated the Alabama Mini-Code, § 5-19-1 et seq., Ala.Code 1975. The plaintiff's claims relate specifically to the practice of "flipping." ¹

Associates responded by filing a motion to transfer, in which it sought a change of venue based upon the doctrine of forum non conveniens, relying on § 6-3-21.1, Ala.Code 1975. This motion to transfer assumed that venue was proper in Greene County. The trial court set a date for a hearing; in the interim, the plaintiff moved for class certification. The trial judge conditionally certified two statewide classes. Associates then amended its motion to transfer, alleging that, under § 6-3-7, Ala.Code 1975, venue in Greene County was improper. The plaintiff amended his complaint to allege a breach of contract.

The trial judge heard oral arguments on Associates' motion to transfer, as amended to allege improper venue, and entered an order that stated in pertinent part:

"1. The Defendant's Amendment to Motion to Transfer on grounds of improper venue is denied as the motion is untimely, has been waived, and/or is inconsistent with the Defendant's initially filed Motion to Transfer under § 6-3-21.1, which presupposes venue is proper in this County.

"2. The Defendant's Motion to Transfer on grounds of forum non conveniens is held pending discovery limited to class certification issues, because a final decision on class certification may have an impact on any determination of where this action should be litigated. This is, if this action is suitable for statewide class treatment, there is no question that litigating the action here would be appropriate.

"3. On Defendant's Motion to Reconsider and Vacate Order conditionally certifying class, the Court hereby decertifies the conditional class, without prejudice, until the Court conducts a full evidentiary hearing."

Associates claims that the trial judge abused his discretion or acted contrary to law relating to the venue question by delaying his ruling on the motion to transfer based upon the forum non conveniens statute.

A writ of mandamus is a drastic and extraordinary writ to be issued only where there is a " '(1) a clear legal right in the petitioner to the order sought; (2) an imperative duty upon the respondent to perform, accompanied by a refusal to do so; (3) the lack of another adequate remedy; and (4) properly invoked jurisdiction of the court.' " Ex parte Auto-Owners Ins. Co., 548 So.2d 1029 (Ala.1989) (quoting Ex parte Edgar, 543 So.2d 682 (Ala.1989)); Ex parte Pearson Management Co., 667 So.2d 48 (Ala.1995). Under the facts and circumstances of the present case, Associates has no "clear legal right" to an order transferring the case. Associates waived the right to raise the question whether venue was proper under § 6-3-7, Ala.Code 1975, and venue in Greene County was made proper by the amendment to the complaint. Rule 12(b), Ala. R. Civ. P.; Till v. State, 595 So.2d 871 (Ala.1992).

We find no clear abuse of the trial judge's discretion, nor any arbitrary or capricious exercise thereof, in the judge's delaying a ruling on the motion to transfer pending consideration of limited discovery on issues of class certification that are relevant to the motion. A delay in ruling on a motion is not, as Associates argues, an ipso facto denial of the motion, nor is it in this case an abuse of discretion. Ex parte Ford Motor Credit Co., 561 So.2d 244 (Ala.Civ.App.1990).

For the reasons stated above, the petition for the writ of mandamus is due to be denied.

WRIT DENIED.

ALMON, KENNEDY, and COOK, JJ., concur.

RICHARD L. HOLMES, Retired Appellate Judge, concurs.

HOOPER, C.J., and MADDOX, HOUSTON, and SEE, JJ., dissent.

BUTTS, J., recuses.

HOOPER, Chief Justice (dissenting).

I dissent, and I write to explain why I agree with Justice Maddox's dissenting opinion. The class action is a unique action at law. Unlike a normal plaintiff, the plaintiff members of the class need not even appear at court. This aspect of the class action was enough to cause at its inception a great deal of controversy. ² It is critical that courts, in particular the highest court of this State, make sure that the rules surrounding the use of the class action be strictly enforced. The potential for abuse of procedure is accentuated in unique types of actions like the class action.

The federal courts have noticed the problem and have recently sought to restrict class actions by preventing the loose application of the rules. In re Rhone-Poulenc Rorer Inc., 51 F.3d 1293 (7th Cir.), cert. den., 516 U.S. 867, 116 S.Ct. 184, 133 L.Ed.2d 122 (1995) (decertification of class because certification would effectively act to coerce defendants into settling); In re American Medical Systems, Inc., 75 F.3d 1069 (6th Cir.1996) (plaintiff class did not meet the four elements required for Rule 23, F.R.Civ.P., certification); Castano v. American Tobacco Co., 84 F.3d 734 (5th Cir.1996) (variations in state law would control the outcome and made a nationwide class unmanageable); Georgine v. Amchem Products, Inc., 83 F.3d 610 (3d Cir.1996) (settlement class must be held to the same standards as a litigation class). Recently, the Civil Rules Advisory Committee, the committee that proposed the 1966 amendments to Federal Rule 23 that created the modern class action, has been reviewing Rule 23 in an attempt to regain some control over its 1966 creation. The problem in the case at bar is perhaps unique to Alabama, but the efforts that are being made at this time to rein in federal class actions is indicative of the problems that can arise if the rules governing class actions are not strictly and carefully followed.

We have a case filed in a county where venue is patently improper. Yet, the trial judge, anticipating that a class action will be certified, has said he will not transfer the case to the proper county. The practical implication of such a decision is to encourage forum shopping. Based on such reasoning, as long as a class action may be certified sometime in the future, venue is proper wherever the plaintiff chooses to file the action. This rationale destroys the venue principle and is clearly a subversion of Alabama law regarding venue. This Court's approval of such a decision by a trial judge encourages violation of Amend. 328, § 6.11, Const. of Ala.1901, which states that, by the exercise of its rulemaking power, this Court "shall not abridge, enlarge or modify the substantive right of any party nor affect the jurisdiction of circuit and district courts or venue of actions therein " (emphasis added).

I understand that it can be argued that the defendant waived the venue issue by filing a motion for transfer based on the statutory forum non conveniens provision. I also understand why the plaintiff amended the complaint to add the contract claim. However, I see too much potential for abuse of the class action in this type of decision by a trial court. I consider the threat this case poses to Alabama's rules regarding venue to outweigh any procedural concern over waiver. This Court has a responsibility to assure the public that abuses of this kind will not continue. We must discourage forum shopping, and we must not allow the courts of this State to go beyond the mandate of Amend. 328, § 6.11.

MADDOX, Justice (dissenting).

The legal issue presented in this case is correctly stated by the petitioner: "[C]an the trial judge for a county in which the named plaintiff has never lived, where no transaction between the named plaintiff and the defendant ever occurred, and where the defendant has no office, employees, or documents, refuse to transfer the case to a county where venue is proper for the named plaintiff's claims?"

The answer to that question is obviously in the negative; therefore, I must respectfully disagree with the majority's conclusion that the trial judge did not abuse his discretion.

My dissenting view is based upon these basic legal conclusions: (1) the Legislature, not this Court, determines venue and (2) the Legislature, in adopting § 6-3-21.1, Ala.Code 1975, the so-called forum non conveniens statute, clearly intended that actions such as this one should be transferred.

The facts of this case are undisputed. On May 8, 1996, Johnnie L. Faniel, Sr., a resident of Union Springs, Bullock County, filed in Greene County an action against Associates Financial Services Company of Alabama ("Associates"), a domestic corporation incorporated in Jefferson County. Faniel alleged that Associates had fraudulently suppressed material facts and had violated the Alabama Mini-Code, § 5-19-1 et seq., Ala.Code 1975, in connection with a consumer credit transaction involving him and agents of Associates that took place at Associates' office in Houston County. ³

In its first response, filed on June 24, 1996, Associates moved for a change of venue, based upon the doctrine of forum non conveniens, as provided for in §...