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Morrow v. Bentley

Supreme Court of Alabama

November 3, 2017

Johnny Mack Morrow and Jim Zeigler
v.
Robert Bentley et al.

         Appeal from Montgomery Circuit Court (CV-16-900989)

          PER CURIAM.

         Johnny Mack Morrow, a member of the Alabama House of Representatives, and Jim Zeigler, auditor for the State of Alabama (hereinafter collectively referred to as "the plaintiffs"), appeal from a judgment of the Montgomery Circuit Court ("the trial court") dismissing their complaint filed against Robert Bentley, individually and in his official capacity as governor of the State of Alabama; Gunter Guy, individually and in his official capacity as commissioner of the Alabama Department of Conservation and Natural Resources; Luther Strange, individually and in his official capacity as attorney general for the State of Alabama; William Newton, individually and in his official capacity as director of the Alabama Department of Finance; and Cooper Shattuck, individually and in his official capacity as executive director of the University of Alabama System's Gulf State Park Project (hereinafter collectively referred to as "the defendants").[1]

         Facts and Procedural History

         On July 25, 2016, Morrow, individually and in his official capacity as a State representative, and Zeigler, individually and in his official capacity as State Auditor, sued the defendants. Relevant to the plaintiffs' claims is the Gulf State Park Projects Act, codified at § 9-14E-1 et seq., Ala. Code 1975 ("the Act"), which was enacted to facilitate the construction of a hotel/conference center in Gulf State Park ("the project"). See § 9-14E-1(9), Ala. Code 1975. Regarding funding for the project, the Act provides:

"Other than project revenues, only National Resource Damage Assessment funds or Restore Act funds may be expended to implement this chapter. If the State of Alabama does not receive or has not been awarded any National Resource Damage Assessment funds or Restore Act funds for the purposes of this chapter by December 31, 2015, this chapter is repealed on January 1, 2016."

§ 9-14E-9, Ala. Code 1975.

         It appears that Alabama received National Resource Damage Assessment funds before December 31, 2015. However, the United States District Court for the Southern District of Alabama ("the district court") entered an order in February 2016 enjoining the use of those funds on the project until the defendants in the district court complied with certain federal requirements.[2] The plaintiffs' complaint alleged that, given the district court's order, the defendants were "[w]ithout any lawful funds to spend upon the [p]roject." Nevertheless, the plaintiffs alleged, the defendants "boldly, unlawfully and hastily proceeded" to fund the project with moneys received from British Petroleum Exploration & Production, Inc. ("BP"), as a result of the 2010 Deepwater Horizon oil spill in the Gulf of Mexico. According to the complaint, those funds are "neither National Resource Damage Assessment funds, nor Restore Act funds, nor Project revenues, " and, thus, the complaint alleged, "State funds ... are now being expended and disbursed by [the defendants] daily in a manner that is unconstitutional and unlawful because none are derived from any source of funds allowed by Alabama law to be so expended or disbursed" on the project. The complaint further alleged that the defendants' funding of the project with moneys not authorized by the Act constituted a usurpation of the appropriation power of the legislature.

         Given those allegations, the plaintiffs' complaint asserted three declaratory-judgment counts. Count I sought a judgment declaring that the defendants "have unlawfully disbursed and expended ... state funds"; "restrain[ing] further unconstitutional and illegal expenditures and disbursements of state funds"; and requiring the defendants "to account ... for any and all sums they have unconstitutionally and/or illegally disbursed or expended." Count II sought a judgment declaring that the Act has been repealed by virtue of § 9-14E-9 and, thus, that the project "cannot lawfully continue." Count III sought a judgment declaring that the defendants "have unlawfully 'appropriated' funds in violation of Constitution of Alabama of 1901"; enjoining the defendants "from continuing to violate ... constitutional and statutory provisions"; "requiring an accounting ... of all ... unconstitutional and unlawful disbursements and expenditures"; and "requiring restoration ... of ... all state funds ... unconstitutionally and unlawfully expended."

         The defendants filed a motion to dismiss in which they asserted, among other defenses, that the plaintiffs lacked standing to prosecute their action in either their individual or official capacities.[3] In their brief in support of the motion, the defendants alleged that the plaintiffs' complaint was the "second assault made ... upon the [project]" in the trial court. In support of that allegation, the defendants attached to their motion a copy of a complaint filed against the defendants in April 2016 by Charles Grimsley, in his individual capacity as a taxpayer, in which Grimsley made essentially the same allegations and sought essentially the same relief the plaintiffs seek in this case.[4] The defendants also attached a copy of a motion to dismiss they had filed in Grimsley's case in which they argued that Grimsley lacked standing to prosecute his action in his capacity as a taxpayer because he failed to allege that funding the project with moneys received from BP would cause him to "suffer the liability of replenishing the state treasury through increased taxes." On July 22, 2016, the trial court, Judge Truman M. Hobbs, dismissed Grimsley's complaint without stating a reason for the dismissal.

         In their motion to dismiss the plaintiffs' complaint in this case, the defendants argued that the only distinction between Grimsley's complaint and the plaintiffs' complaint is that Grimsley brought his complaint in his individual capacity as a taxpayer and the plaintiffs brought their action in both their individual and their official capacities. As to the plaintiffs' standing in their individual capacities, the defendants argued that the plaintiffs, like Grimsley, had failed to allege that funding the project with moneys received from BP would result in a probable increase in their tax burden and, thus, that they lacked standing to prosecute their action in their capacities as taxpayers. As to the plaintiffs' standing in their official capacities, the defendants argued that the plaintiffs' "representative capacity has [no] legal effect" on a determination of standing and "confers [no] special right upon [them]" to prosecute their action. The defendants further argued that the moneys funding the project are the "legal equivalent of federal funds or private grant funds, " and, their argument continued, "[i]t is axiomatic that the Alabama Legislature cannot appropriate these funds or control or interfere with the manner in which they are spent."

         The plaintiffs filed a reply to the motion to dismiss, but they failed to respond to the defendants' argument that they lacked standing in their individual capacities as taxpayers. Instead, the plaintiffs argued that, "[u]nlike ordinary tax paying citizens, [the plaintiffs] are elected state officials whose standing does not require a showing that the funds being used ... are tax dollars." In response to the defendants' argument that the moneys funding the project were the equivalent of federal or private-grant funds, the plaintiffs argued that the moneys were nevertheless "state funds subject to appropriation by the state Legislature." Thus, the plaintiffs argued, Zeigler, as State Auditor, was tasked with auditing the State's finances, and Morrow, as a member of the legislature, had standing to prosecute an action to ensure that the defendants "follow the law and not usurp constitutional and statutory powers afforded" the plaintiffs.

         The trial court, Judge Gregory O. Griffin, Sr., held a hearing on the defendants' motion to dismiss and subsequently entered a judgment on September 15, 2016, dismissing the complaint on the ground that the plaintiffs lacked standing to prosecute the action. The plaintiffs, arguing that they have standing in both their individual capacities as taxpayers and in their official capacities, timely appealed. We affirm.

         Discussion

         I. The Plaintiffs' Standing as Taxpayers

         Initially, we note that "'[t]he issue of standing presents a pure question of law, and the trial court's ruling on that issue is entitled to no deference on appeal.'" Town of Mountainboro v. Griffin, 26 So.3d 407, 409 (Ala. 2009) (quoting Blue Cross & Blue Shield of Alabama v. Hodurski, 899 So.2d 949, 953 (Ala. 2004)). The plaintiffs first argue that they have standing to prosecute their action in their individual capacities as taxpayers. However, the plaintiffs waived that argument by not presenting it to the trial court. See Allsopp v. Bolding, 86 So.3d 952, 962 (Ala. 2011) ("It is well settled that an appellate court may not hold a trial court in error in regard to theories or issues not presented to that court.").

         At the hearing on the defendants' motion to dismiss, the defendants argued (as they did in their motion) that the plaintiffs lacked standing to prosecute their action in their individual capacities as taxpayers. However, just as the plaintiffs did not respond to that argument in their reply to the motion to dismiss, the plaintiffs' attorney did not respond to that argument at the hearing. Instead, the plaintiffs' attorney argued only that the plaintiffs had standing in their official capacities and, in fact, expressly indicated to the trial court at the beginning of the hearing that the plaintiffs were not asserting the same standing ground Grimsley had asserted, i.e., taxpayer standing:

"[Plaintiffs' attorney]: Your Honor, the first thing that I think I need to reply to is what [the defendants' attorney] said about this being the same case that's been in front of Judge Hobbs. We could not disagree more.
"Charles Grimsley filed an action that was assigned to Judge Hobbs as a taxpayer. ... He was saying [that] as a taxpayer of Alabama he [had] standing. And Judge Hobbs simply said that a taxpayer did not have standing.
"... And now [the plaintiffs] are ... in a separate case alleging totally separate bases for standing from what Grimsley had ...."

(Emphasis added.)

         At the close of the hearing, the plaintiffs' attorney reiterated that the plaintiffs were not asserting the same standing ground Grimsley had asserted but, instead, were asserting that they had standing solely in their official capacities:

"[Plaintiffs' attorney]: [The defendants' attorney] likes to come back to this taxpayer revenue, taxpayer standing issue because he was successful with that in front of Judge Hobbs. This is not the same case. These are not the same claims. The plaintiffs in this case are uniquely situated as elected officials to challenge the use of public moneys, Alabama's money, by these defendants without legislative appropriation."

(Emphasis added.)

         It is true that the plaintiffs filed their action both in their individual capacities as taxpayers and in their official capacities and, thus, in one sense, "presented" the "taxpayer-standing" theory to the trial court. Allsopp, supra. However, it is evident that the plaintiffs not only failed to assert that theory in their response to the motion to dismiss and at the hearing on that motion but also expressly abandoned that theory at the hearing. It is also evident that the trial court was under the impression that the plaintiffs were asserting their standing only in their official capacities, regardless of the substance of their complaint. The trial court's judgment states, in pertinent part:

"[The plaintiffs], in both their individual and official capacities, assert their claims against the Defendants. However, their arguments and authorities submitted in opposition to the Motion to Dismiss address only the contention that ... Morrow in his capacity as a member of the Alabama House of Representatives and ... Zeigler in his capacity as the Auditor of the State of Alabama, have ...

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