MetFuel, Inc. v. Louisiana Well Service Co.

• Citation: 628 So.2d 601
• Parties: METFUEL, INC. v. LOUISIANA WELL SERVICE COMPANY. 1921289.
• Decision Date: 19 November 1993
• Court: Supreme Court of Alabama

Page 601

628 So.2d 601

METFUEL, INC. v. LOUISIANA WELL SERVICE COMPANY.

1921289.

Supreme Court of Alabama.

Nov. 19, 1993.

Charles E. Pearson of Pearson & Smithart, P.C., Tuscaloosa, for appellant.

John M. Johnson and Madeline H. Haikala of Lightfoot, Franklin, White & Lucas, Birmingham, for appellee.

RICHARD L. JONES, Retired Justice.

The defendant, MetFuel, Inc., appeals from a judgment of dismissal, without prejudice, pursuant to the plaintiff Louisiana Well Service Company's Rule 41, A.R.Civ.P., motion. We affirm.

Louisiana Well Service Company ("LWS") and MetFuel executed three contracts by which LWS was to provide drilling and related services to MetFuel's methane gas wells in Alabama. The contracts were controlled by Mississippi law. LWS drilled 47 wells for MetFuel and sent invoices to MetFuel based on this work. MetFuel paid LWS over $2 million, but refused to pay certain invoices totalling $1,752,729.12.

LWS sued MetFuel in a Mississippi state court to enforce the contracts and to collect the $1,752,729.12 in unpaid, disputed charges for work done by LWS. LWS also asked for an accounting and for a declaration of ownership of certain drill pipe. MetFuel removed the action to a federal court in Mississippi and filed a counterclaim.

In its brief to this Court, LWS states that "in an attempt to guarantee payment, should [it] prevail in its Mississippi lawsuit, LWS filed a verified statement of lien against certain Alabama property on which LWS had drilled wells on behalf of MetFuel" and that "LWS then filed a complaint in the Circuit Court of Tuscaloosa County to perfect the lien" and to obtain a judgment against MetFuel for $1,752,729.12. LWS states that the issue posed by the Alabama action is "virtually identical" to that in the Mississippi action: whether MetFuel breached its contracts with LWS by failing to pay $1,752,729.12 on 42 LWS invoices.

MetFuel did not file an answer in LWS's Alabama action; however, one month after being served with the summons and complaint in the Alabama action, MetFuel moved for a summary judgment, claiming that its contracts with LWS were void and unenforceable because LWS, as a general contractor, had not obtained a general contractor's license before beginning its work for MetFuel in Alabama.

The trial court granted MetFuel's motion for summary judgment, agreeing with MetFuel that LWS could not enforce the contracts because it had not obtained a "general contractor" license. Under Alabama law, "contracts of unlicensed general contractors have been held null and void as a violation of ... public policy." Brown v. Mountain Lakes Resort, Inc., 521 So.2d 24, 25 (Ala.1988).

On appeal, this Court reversed and remanded, holding that, under the statutory definition of "general contractor," Ala.Code 1975, § 34-8-1(a), LWS was not a general contractor, that LWS was not required to obtain a general contractor's license for the work done for MetFuel, and, therefore, that LWS's contracts were enforceable. Louisiana Well Service, Inc. v. MetFuel, Inc., 614 So.2d 1039 (Ala.1993).

Immediately upon our remand to the trial court, LWS filed a Rule 41(a), A.R.Civ.P., motion to dismiss the action, without prejudice. MetFuel filed an objection to the motion, supported by the deposition of the owner and president of LWS, Alton Ogden, Jr., and the affidavit of MetFuel's lawyer, Charles Pearson. The court dismissed the action, without prejudice or condition; MetFuel appeals.

Rule 41, entitled "Dismissal of actions," reads in part as follows:

"(a) Voluntary dismissal: Effect Thereof.

"(1) By Plaintiff, By Stipulation. Subject to the provisions of Rule 23(e) [dismissal or compromise of class action], of Rule 66 ['Receivers'], and of any statute of this state, an action may be dismissed by the plaintiff without order of court (i) by filing a notice of dismissal at any time before service by the adverse party of an answer or of a motion for summary judgment, whichever first occurs, or (ii) by filing a stipulation of dismissal signed by all parties who have appeared in the action. Unless otherwise stated in the notice of dismissal or stipulation, the dismissal is without prejudice, except that a notice of dismissal operates as an adjudication upon the merits when filed by a plaintiff who has once dismissed in any court of Alabama, or of the United States, or of any state, an action based on or including the same claim.

"(2) By Order of Court. Except as provided in paragraph (1) of this subdivision of this rule, an action shall not be dismissed at the plaintiff's instance save upon order of the court and upon such terms and conditions as the court deems proper. If a counterclaim has been pleaded by a defendant prior to the service upon him of the plaintiff's motion to dismiss, the action may be dismissed but the counterclaim shall remain pending for adjudication by the court. Unless otherwise specified in the order, a dismissal under this paragraph is without prejudice."

As pointed out by both parties, because MetFuel had filed a motion for summary judgment in the Alabama action and because MetFuel did not stipulate to dismissal of the action, LWS's motion for dismissal was, necessarily, considered by the trial court according to the provisions of Rule 41(a)(2).

On appeal, MetFuel quotes from the committee comments to Rule 41:

"The purpose of Rule 41(a) is to facilitate voluntary dismissals but to limit them to an early stage of the proceedings before issue is joined. Once issue has been joined, by answer or by motion for summary judgment, voluntary dismissal can only be upon court order, and the court is given broad powers to prevent harassment of or inconvenience to the defendant by an arbitrary dismissal at this advanced stage of the case."

(Citations omitted.)

MetFuel contends that the court clearly abused its discretion in granting LWS's motion to dismiss because, MetFuel says, it had expended large sums of money and many hours of legal work in defending itself in the Alabama action, the case had gone past the "early stage of the proceedings," and issue had been joined by the motion for summary judgment. LWS argues, however, that dismissal was within the court's broad discretion. We agree with LWS.

In addressing MetFuel's contentions that it spent much time and money "defending" the Alabama action and that the action had gone beyond the early stages of the lawsuit, we find the following chronology to be helpful. MetFuel's motion for summary judgment on the jurisdictional issue (whether the contracts that formed the basis of the action were void and unenforceable), was filed on June 20, 1991 (approximately one month after the complaint was filed), and was granted on March 25, 1992 (the motion was supported by one deposition and one affidavit). LWS immediately appealed the summary judgment, and this Court released its opinion reversing MetFuel's summary judgment and remanding the cause to the trial court on March 12, 1993. LWS filed its Rule 41(a)(2) motion to dismiss on March 26, 1993. The trial court heard arguments on the motion on April 14, 1993, and entered its order granting the motion to dismiss at the close of the hearing. In light of the above, we can not say that this action had proceeded "past the early stages" or that MetFuel had spent so much time and effort as to preclude the trial court from considering a motion to dismiss.

MetFuel correctly states that the Alabama action had been pending...