Miss. Valley Title Ins. Co. v. Marion Bank & Trust Co.
| Decision Date | 12 October 2012 |
| Docket Number | CIVIL ACTION 11-0538-WS-C |
| Parties | MISSISSIPPI VALLEY TITLE INSURANCE COMPANY, et al., Plaintiffs, v. MARION BANK AND TRUST COMPANY, et al., Defendants. |
| Court | U.S. District Court — Southern District of Alabama |
This matter is before the Court on the motion of defendant J. Garrison Thompson for summary judgment and on the competing motion of plaintiffs Mississippi Valley Title Insurance Company ("Mississippi Valley") and Old Republic National Title Insurance Company ("Old Republic") (collectively, "the plaintiffs") for partial summary judgment. (Docs. 49, 64). The movants have filed briefs and evidentiary materials in support of their respective positions, (Docs. 50-63, 65-67, 71, 78-80, 84, 86), and the motions are ripe for consideration.
Thompson, a licensed attorney, performed title work for Mississippi Valley pursuant to an agency agreement ("the Agreement"). In November 2001, while acting under the Agreement, Thompson performed a title search with respect to certain property ("the Rabb Property") in connection with the Rabbs' procurement of a loan from CTX Mortgage Company ("CTX"). While acting under the Agreement, Thompson thereafter issued a commitment for title insurance and atitle policy ("the 2001 Policy") on behalf of Mississippi Valley.1 The 2001 Policy insured the CTX mortgage as a first mortgage lien even though an earlier mortgage to defendant Marion Bank & Trust Company ("Marion Bank") was of record.
In 2003, the Rabbs sought an additional mortgage loan from Marion Bank. Again acting under the Agreement, Thompson performed a title search and thereafter issued a title commitment and a title policy ("the 2003 Policy") to Marion Bank. The commitment did not set out the CTX mortgage as a requirement or exception, although the subsequently issued 2003 Policy did except that mortgage.
When the Rabbs defaulted on payment some years later, Marion Bank held a preferred position, leaving the movants exposed to payment to Wells Fargo on the 2001 Policy, an exposure potentially increased by the failure of the 2003 commitment to except the CTX mortgage. Count One of the amended complaint alleges that Thompson's failures breached the Agreement and also breached common-law duties.2
The plaintiffs seek partial summary judgment as to their claims under Count One. The relief sought is partial because it addresses Thompson's liability but not the quantum of damages. Thompson moves for summary judgment on the grounds that Count One is barred by the statute of limitations.
Summary judgment should be granted only if "there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law."Fed. R. Civ. P. 56(a). The party seeking summary judgment bears "the initial burden to show the district court, by reference to materials on file, that there are no genuine issues of material fact that should be decided at trial." Clark v. Coats & Clark, Inc., 929 F.2d 604, 608 (11th Cir. 1991). The moving party may meet its burden in either of two ways: (1) by "negating an element of the non-moving party's claim"; or (2) by "point[ing] to materials on file that demonstrate that the party bearing the burden of proof at trial will not be able to meet that burden." Id. "Even after Celotex it is never enough simply to state that the non-moving party cannot meet its burden at trial." Id.; accord Mullins v. Crowell, 228 F.3d 1305, 1313 (11th Cir. 2000); Sammons v. Taylor, 967 F.2d 1533, 1538 (11th Cir. 1992).
United States v. Four Parcels of Real Property, 941 F.2d 1428, 1438 (11th Cir. 1991) (en banc) (emphasis in original); accord Fitzpatrick v. City of Atlanta, 2 F.3d 1112, 1115 (11th Cir. 1993).
"If the party moving for summary judgment fails to discharge the initial burden, then the motion must be denied and the court need not consider what, if any, showing the non-movant has made." Fitzpatrick, 2 F.3d at 1116; accord Mullins, 228 F.3d at 1313; Clark, 929 F.2d at 608.
"If, however, the movant carries the initial summary judgment burden ..., the responsibility then devolves upon the non-movant to show the existence of a genuine issue of material fact." Fitzpatrick, 2 F.3d at 1116. "If the nonmoving party fails to make 'a sufficient showing on an essential element of her case with respect to which she has the burden of proof,' the moving party is entitled to summary judgment." Clark, 929 F.2d at 608 (quoting Celotex Corp. v. Catrett,477 U.S. 317 (1986)) (footnote omitted); see also Fed. R. Civ. P. 56(e)(2) ().
In deciding a motion for summary judgment, "[t]he evidence, and all reasonable inferences, must be viewed in the light most favorable to the nonmovant ...." McCormick v. City of Fort Lauderdale, 333 F.3d 1234, 1243 (11th Cir. 2003).
There is no burden on the Court to identify unreferenced evidence supporting a party's position.3 Accordingly, the Court limits its review to the exhibits, and to the specific portions of the exhibits, to which the parties have expressly cited. Likewise, "[t]here is no burden upon the district court to distill every potential argument that could be made based upon the materials before it on summary judgment," Resolution Trust Corp. v. Dunmar Corp., 43 F.3d 587, 599 (11th Cir. 1995), and the Court accordingly limits its review to those arguments the parties have expressly advanced.
Thompson argues that Count One is governed by the Alabama Legal Services Liability Act ("the Act"), including its limitations period. The plaintiffs argue that Count One is timely even if the Act applies but that the Act does not apply in any event. (Doc. 65 at 21).
Under the Act, an action generally must be commenced "within two years after the act or omission or failure giving rise to the claim, and not afterwards." Ala. Code § 6-5-574(a). There is a limited exception when "the cause of action is not discovered and could not reasonably have been discovered within such period," but "in no event may the action be commenced more than four years after such act or omission or failure." Id.
The Alabama Supreme Court has offered varying explanations of when the limitations period under Section 6-5-574 begins to run. It has sometimes stated that "'a legal-malpractice cause of action accrues, and the statute-of-limitations period begins to run, when "the act or omission or failure giving rise to the claim" occurs, and not when the client first suffers actual damage.'" Ex parte Seabol, 782 So. 2d 212, 214 (Ala. 2000) (quoting Ex parte Panell, 756 So. 2d 862, 868 (Ala. 1999) (plurality opinion)). On other occasions, it has indicated that the limitations period does not begin to run on the date of the act, omission or failure but on the date the plaintiff first suffers a "legal injury" from the act, omission or failure. E.g., Sirote & Permutt, P.C. v. Bennett, 776 So. 2d 40, 45 (Ala. 2000); Michael v. Beasley, 583 So. 2d 245, 252 (Ala. 1991). In a pair of more recent decisions, the Supreme Court has recognized the two strands of authority but declined to elect between them, since the plaintiffs' claims were barred under either approach. Coilplus-Alabama, Inc. v. Vann, 53 So. 3d 898, 905-07 (Ala. 2010); Denbo v. DeBray, 968 So. 2d 983, 988-89 (Ala. 2006).
In Mississippi Valley Title Insurance Co. v. Hooper, 707 So. 2d 209 (Ala. 1997), the defendant issued title opinions incorrectly certifying that various mortgagees seeking title insurance would have a first mortgage lien, and he thereafter issued title insurance policies based on these inaccurate certifications. Id. at 211. The Court utilized the "legal injury" approach and held that, under this test, "any cause of action Mississippi Valley had against Hooper for issuing insurance policies based on a faulty title opinion accrued when the policies wereissued, and not when Mississippi Valley later settled lawsuits filed against it based on the policies." Id. at 213. The Hooper Court expressly "reject[ed] the argument that Mississippi Valley incurred legal injury only when it had to pay claims made under its policies." Id.; see also Bennett, 776 So. 2d at 45-46 ().
It is uncontroverted that the 2001 Policy was issued in November 2001 and that the 2003 Policy was issued in November 2003. If the Act applies to Count One, under Hooper the limitations period began to run at those times.4 Under the two-year period of Section 6-5-574(a), the limitations period expired in November 2003 and November 2005, respectively. The plaintiffs do not invoke the extended limitations period for delayed discovery of the cause of action but, even had they done so and done so successfully, the limitations period would have expired no later than November 2005 and November 2007, respectively. Since this action was not filed until September 2011, Count One cannot satisfy Section 6-5-574(a).
The plaintiffs offer several reasons why the limitations period of Section 6-5-574 does not bar their claim...
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