Jerry K. McCullough
Allstate Property and Casualty Insurance Company
from Limestone Circuit Court (CV-15-27)
ON APPLICATION FOR REHEARING
court's opinion of October 27, 2017, is withdrawn, and
the following is substituted therefor.
K. McCullough appeals from a summary judgment entered by the
Limestone Circuit Court ("the trial court") in
favor of Allstate Property and Casualty Insurance Company
("Allstate"). We affirm the judgment in part and
reverse it in part.
and Procedural History
2011, Allstate issued a policy of automobile insurance
("the policy") to McCullough, insuring, among other
vehicles, his 2002 Dodge Ram 1500 pickup truck ("the
truck"). McCullough loaned the truck to an acquaintance,
who returned it to McCullough in September 2012 in a damaged
condition. In January 2013, McCullough filed a claim on the
policy. After an Allstate adjuster inspected the truck,
finding multiple points of damage, Allstate took the position
that the truck had been damaged in more than one accident.
Allstate advised McCullough that it would treat his claim as
involving multiple different claims, each of which would be
subject to the policy deductible of $250. McCullough
objected, contending that the damage had resulted from one
accident for which only one deductible should be applied.
Based on that disagreement, McCullough filed a lawsuit
against Allstate in the United States District Court for the
Northern District of Alabama ("the federal
lawsuit") in March 2013.
16, 2013, McCullough and Allstate tentatively agreed to
settle the federal lawsuit for $8, 000. McCullough
subsequently learned that Allstate had reported to LexisNexis
Comprehensive Loss Underwriting Exchange ("CLUE")
and Verisk Analytics Automobile Property Loss Underwriting
Service ("A-PLUS") that it had opened multiple
claims regarding the damage to the truck. Expressing concern
that the reports would inflate his future
automobile-insurance costs, McCullough informed
Allstate's attorney that he would not settle the federal
lawsuit unless Allstate arranged to have the reports
corrected to reflect that he was making only one insurance
claim with a date of loss of September 3, 2012. McCullough
also informed Allstate's attorney that he did not
consider the $8, 000 to be a payment on the claim, and he
wanted Allstate either to report to CLUE and A-PLUS that it
had paid nothing on the claim or to delete its reports
altogether. According to McCullough, on August 2, 2013,
Allstate's attorney sent McCullough an e-mail message
indicating that Allstate had reported to CLUE that it had
paid nothing on the claim.
on August 2, 2013, McCullough executed a "Release and
Settlement Agreement" ("the release"). The
pertinent terms of the release were as follows:
"For and in consideration of the payment to
[McCullough], the sum of EIGHT THOUSAND AND NO/100 DOLLARS
($8, 000.00), and other good and valuable consideration,
[McCullough] has released and discharged, [Allstate], its
owners, officers, directors, stockholders, employees, agents,
attorneys, representatives, subsidiaries, affiliated
companies, parent companies, successors, and assigns, and all
others, of and from any and all actions, causes of action,
choses in action, rights of recovery, theories of recovery,
and claims or demands for damages, costs, including, but not
limited to, claims for insurance policy benefits and 'bad
faith, ' as well as damage claims seeking policy
benefits, property damage, mental anguish damages, or
punitive damages, or any other thing whatsoever on account
of, or in any way arising out of, the claims and matters
described in [the federal lawsuit].
"[McCullough] agrees, understands and acknowledges that
acceptance of the payment sum pursuant to this settlement
agreement is a full, complete, final and binding compromise
of matters involving disputed issues regardless of whether
too much or too little may have been paid. As part of the
bargained-for consideration for this Release ..., Allstate
agrees to put forth its best effort to revise its reporting
to [CLUE], and/or any other Index Bureau, to reflect that
there was only one occurrence giving rise to the claims made
the basis of this lawsuit, and only one date of loss, i.e.,
September 3, 2012.
"This Settlement Agreement contains the entire agreement
between [McCullough] and the released parties with regard to
the matters set forth herein. There are no understandings or
agreements, verbal or otherwise, between the parties except
as expressly set forth."
on the release, the federal lawsuit was dismissed with
prejudice. By September 8, 2013, McCullough informed
Allstate's attorney in an e-mail message that he was
satisfied from correspondence he had received from CLUE and
A-PLUS that the claim reports had been deleted.
November 2014, McCullough applied for automobile insurance
with a different insurer. McCullough learned that, in October
2013, Allstate had reported to CLUE and A-PLUS that it had
paid $8, 000 to McCullough on the September 3, 2012, claim.
McCullough disputed the reports. CLUE eventually deleted the
claim report after Allstate did not respond to its inquiries.
A-PLUS, on the other hand, maintained the claim report based
on its correspondence with Allstate, which had confirmed that
it had reported paying $8, 000 on the claim. McCullough
thereafter informed Allstate on multiple occasions that he
disputed the A-PLUS report, but Allstate maintained its
position that it had validly reported the $8, 000 payment.
filed a complaint against Allstate in the trial court on
August 17, 2015, seeking equitable relief and damages for
"breach of settlement agreement, " bad faith,
negligence, fraudulent misrepresentation, violations of the
Fair Credit Reporting Act, 15 U.S.C. § 1681 et seq.,
fraudulent inducement, defamation, harassment, and invasion
of privacy. Allstate filed a timely answer, asserting
multiple affirmative defenses.
November 4, 2015, Allstate moved for a summary judgment,
asserting that all of McCullough's claims arose out of
the same matters set forth and settled in the federal
lawsuit; that McCullough's claims were barred by waiver,
estoppel, accord and satisfaction, and release; that
"any discussions or e-mails leading up to the
consummation of the final settlement agreement are merged
into the Release which specifically states that it is the
'entire agreement between [McCullough] and [Allstate]
with regard to the matters set forth herein'"; and
that Allstate had complied with the terms of the release.
Allstate submitted the affidavit of Heath Harmon, the
"Casualty Claims Service Leader" for Allstate, in
support of its motion, pursuant to Rule 56(c), Ala. R. Civ.
November 7, 2015, McCullough filed a motion to compel
Allstate to produce discovery and requested that the trial
court impose discovery sanctions on Allstate. On November 19,
2015, McCullough filed a response to the motion for a summary
judgment and a motion for a partial summary judgment on his
claims alleging "breach of settlement agreement, "
negligence, fraudulent misrepresentation, and fraudulent
inducement. He filed, pursuant to Rule 56(c), his own
affidavit and other evidentiary materials in support of the
response and motion. That same day, he also filed an
amendment to his motion to compel discovery and to impose
discovery sanctions. On November 20, 2015, Allstate responded
to McCullough's motion to compel discovery and for
discovery sanctions. On November 30, 2015, McCullough filed
an addendum to his response to Allstate's
summary-judgment motion and to his motion for a partial
summary judgment. That same day, Allstate responded to
McCullough's amendment to his motion to compel discovery
and for discovery sanctions.
December 8, 2015, Allstate filed a reply to McCullough's
response to Allstate's summary-judgment motion, as well
as a motion to strike portions of McCullough's Rule 56(c)
affidavit. On December 11, 2015, McCullough filed an addendum
to his ...