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Barnhart v. Ingalls

Supreme Court of Alabama

November 21, 2018

Deborah Barnhart, Brooke Balch, and Vickie Henderson, individually and in their official capacities as officers of the Alabama Space Science Exhibit Commission
v.
Janice Ingalls, Milton Parker, and Kamara Bowling Davis

          Appeal from Madison Circuit Court (CV-16-12)

          STUART, CHIEF JUSTICE

         Deborah Barnhart, Brooke Balch, and Vickie Henderson, current and former officers of the Alabama Space Science Exhibit Commission ("the Commission") (hereinafter referred to collectively as "the Commission officers"), petition this Court for a writ of mandamus directing the Madison Circuit Court to dismiss the claims asserted against them in this class action or, in the alternative, to vacate its order certifying those claims for class-action treatment. We treat the petition as an appeal, and we affirm in part and reverse in part.

         I.

         The Commission was created as a State agency in 1965 by the Alabama Legislature to provide for and manage "facilities to house and display such visual exhibits of space exploration and hardware used therefor as may be made available by the National Aeronautics and Space Administration." § 41-9-430, Ala. Code 1975. In accordance with that purpose, the Commission opened the U.S. Space & Rocket Center ("the Rocket Center") in March 1970 and, since that time, has continued to operate the popular museum and learning center in Huntsville. At the time this action was initiated, the Commission employed approximately 120 individuals at the Rocket Center.

         The Commission is required by law to maintain records of its revenue and expenditures and to periodically make those records available for audit by the Department of Examiners of Public Accounts ("DEPA"). § 41-9-437, Ala. Code 1975. During the summer of 2013, DEPA conducted a financial and compliance audit of the Commission's records for the period spanning October 2007 through September 2012. In October 2013, DEPA representatives met with certain Commission representatives -- including Barnhart, the chief executive officer; and Balch, the vice president of finance -- to discuss the findings of the audit. Among those findings were the conclusions that the Commission had not complied with Alabama law (1) in its payment of annual longevity bonuses to Commission employees and (2) in the manner it compensated Commission employees for working on certain State holidays. With regard to the Commission's payment of annual longevity bonuses, DEPA cited § 36-6-11(a), Ala. Code 1975, which provides:

"Each person employed by the State of Alabama, and all legislative personnel, officers, or employees, including but not limited to Legislative Reference Service personnel, whether subject to the state Merit System or not, shall be entitled to and receive in a lump sum the first payday of December each year the sum of three hundred dollars ($300) per annum after such employee has served for a total period of five years and shall receive the payment until the tenth year of total service, at which time the payment shall be made in a like manner and at a like time but in the amount of four hundred dollars ($400) per annum until the fifteenth year of total service, at which time the payment shall be made in a like manner and at a like time but in the amount of five hundred dollars ($500) per annum until the twentieth year of total service, at which time the payment shall be made in a like manner and at a like time but in the amount of six hundred dollars ($600) per annum until the twenty-fifth year of total service, at which time the payment shall be made in a like manner and at a like time, but in the amount of seven hundred dollars ($700) as long as the employee remains in service. Beginning October 1, 2006, and continuing each fiscal year thereafter in which an employee does not receive a cost-of-living increase in compensation, each per annum amount provided in this subsection shall be increased by one hundred dollars ($100) per year to a maximum amount of one thousand dollars ($1, 000) for 25 years of total service as long as the employee remains in service."

DEPA concluded that the Commission had not been complying with § 36-6-11(a) inasmuch as it had not increased the annual longevity bonuses paid to Commission employees in those years in which the Commission employees did not receive cost-of-living raises, and it accordingly recommended that the Commission "re-compute longevity pay for each employee for all years in which they were qualified to receive longevity pay for reason of not having received a cost of living pay increase and [the Commission] should pay the employees the total amount of all underpayments due them."

         With regard to the compensation of Commission employees who worked on State holidays, DEPA noted that § 1-3-8, Ala. Code 1975, authorizes 13 State holidays: (1) New Year's Day; (2) Martin Luther King, Jr.'s birthday/Robert E. Lee's birthday; (3) Mardi Gras;[1] (4) George Washington's birthday/Thomas Jefferson's birthday; (5) Confederate Memorial Day; (6) National Memorial Day; (7) Jefferson Davis's birthday; (8) Fourth of July; (9) Labor Day; (10) Columbus Day/Fraternal Day/American Indian Heritage Day; (11) Veterans' Day; (12) Thanksgiving; and (13) Christmas Day. Subsection 1-3-8(e) further provides that "[a]ll state holidays shall be observed by the closing of all state offices" and that "[a]ny state employee working on a state holiday shall receive a day of compensatory leave or paid compensation in lieu of the holiday." In practice, however, the Commission observed only seven of the State holidays, [2] and DEPA accordingly deemed the Commission to be out of compliance with § 1-3-8. To become compliant, DEPA recommended that the Commission observe all the holidays enumerated in § 1-3-8 and that it begin providing compensatory leave or appropriate paid compensation to employees working on those holidays.

         Upon being informed of these findings, representatives of the Commission notified DEPA that they disagreed with the finding that the Commission had not complied with § 36-6-11(a) and § 1-3-8 (hereinafter referred to collectively as "the benefits statutes") because, they argued, the legislation pursuant to which the Commission was created, § 41-9-430 et seq., Ala. Code 1975, removed the Commission from the purview of certain state employment laws, including the benefit statutes. In January 2014, DEPA released the Commission audit to the public, at which time Commission employees became aware of the findings regarding their benefits. Commission representatives, including Barnhart and Henderson, the vice president of human resources, thereafter held a meeting open to all Commission employees at which they stated that they had reviewed the audit and that they disagreed with its findings but that any changes that were required would be made.

         No changes were made, however, and on October 16, 2015, several former Commission employees sued the Commission and the Commission officers, alleging that the plaintiffs, as well as other past and present Commission employees, had not received all the compensation to which they were entitled during their tenures as Commission employees. Another lawsuit based on the same general facts was filed in the United States District Court for the Middle District of Alabama; that lawsuit, however, was eventually dismissed. See Ingalls v. U.S. Space & Rocket Ctr., 679 Fed.Appx. 935, 937 (11th Cir. 2017) (not selected for publication in the Federal Reporter) (affirming the federal district court's dismissal of equal-protection and due-process claims filed against the Commission officers because "the former employees failed to allege a violation of clearly established law" and the former employees "will receive adequate process in their parallel Alabama state court litigation").

         The instant action was initially filed in the Montgomery Circuit Court but was subsequently transferred to the Madison Circuit Court. As amended on March 10, 2017, the complaint filed by the former employees of the Commission (hereinafter referred to collectively as "the named plaintiffs") alleged that they had not been paid the amount of longevity bonuses to which they were entitled when they were Commission employees and that they had not been properly compensated for working on State holidays that were not observed at the Rocket Center. The named plaintiffs accordingly asserted claims against the Commission officers in their official capacities seeking (1) a judgment declaring that the Commission's existing policies and compensation plan did not comply with the plain terms of the benefits statutes ("the declaratory-relief claim"); (2) an injunction requiring the Commission officers to henceforth comply with those statutes ("the prospective-relief claim"); and (3) an award of all moneys previously earned but not paid because of the failure to comply with the benefits statutes ("the retrospective-relief claim"). The named plaintiffs also asserted negligence/wantonness and breach-of-fiduciary-duty claims against the Commission officers in their individual capacities ("the individual-capacities claims").[3]

         As directed by the trial court, the parties engaged in discovery related solely to the issue of class certification, and, on June 23, 2017, the named plaintiffs formally moved for class certification of their claims. The Commission officers opposed that motion, arguing that class certification was inappropriate, while also moving the trial court to enter a summary judgment in their favor on immunity, standing, and statute-of-limitations grounds. The trial court initially scheduled a hearing on the class-certification and summary-judgment motions for the same day; however, after the named plaintiffs objected to the trial court's considering the Commission officers' "merit-based defenses" before ruling on their motion for class certification, the trial court instructed the parties that it would not consider the Commission officers' summary-judgment motion until the class-certification issue was decided. See Mitchell v. H&R Block, Inc., 783 So.2d 812, 816 (Ala. 2000) ("The question of class certification is a procedural one distinct from the merits of the action.").

         On November 17, 2017, the trial court partially granted the named plaintiffs' motion for class certification. Specifically, the trial court certified for class-action treatment (1) the declaratory-relief claim; (2) the retrospective-relief claim; and (3) the individual-capacities claims.[4] The trial court declined, however, to certify the prospective-relief claim because none of the named plaintiffs were current employees of the Commission and because they might, to the detriment of current Commission employees, accordingly be motivated to focus on recovering past damages as opposed to obtaining prospective injunctive relief that would not directly benefit them.[5]

         On December 27, 2017, the Commission officers petitioned this Court for a writ of mandamus directing the trial court to vacate its order certifying the class and to instead enter an order in favor of the Commission officers dismissing the named plaintiffs' claims. On March 21, 2018, this Court stayed proceedings in the trial court pending a final decision on the Commission officers' petition and ordered the named plaintiffs to file an answer to the Commission officers' arguments.

         II.

         This Court has explained that "the writ of mandamus is to be reserved for genuinely extraordinary situations and circumstances." Hunt v. State, 641 So.2d 270, 271 (Ala. 1994). As such, this Court will issue the writ of mandamus

"only where there is (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 Integon Corp., 672 So.2d 497, 499 (Ala. 1995) (emphasis added). The Commission officers argue that the instant case presents such an extraordinary situation because, they argue, (1) the trial court lacks subject-matter jurisdiction to consider the named plaintiffs' claims and (2) the requirements for class certification set forth in Rule 23, Ala. R. Civ. P., were not met. In support of their position, the Commission officers cite Ex parte Retirement System of Alabama, 182 So.3d 527, 531-32 (Ala. 2015) (explaining that mandamus will lie to compel the dismissal of claims barred by the doctrine of State immunity), and Ex parte Green Tree Financial Corp., 684 So.2d 1302, 1305 (Ala. 1996) (providing that "[a]n order certifying an action as a class action is subject to review by way of a petition for a writ of mandamus").

         The named plaintiffs, however, argue that the Commission officers' reliance on Ex parte Green Tree is misguided because, in 1999, the legislature enacted § 6-5-642, Ala. Code 1975, which provides that "[a] court's order certifying a class or refusing to certify a class action shall be appealable in the same manner as a final order to the appellate court which would otherwise have jurisdiction over the appeal from a final order in the action." See also Atlanta Cas. Co. v. Russell, 798 So.2d 664, 666 (Ala. 2001) ("The enactment of § 6-5-642, Ala. Code 1975, a statute that became effective before the certification was made in this case, provides parties with the right of appeal from an order granting or denying class certification."). Accordingly, the named plaintiffs argue that the Commission officers' petition for a writ of mandamus should be denied because they have another adequate remedy -- an appeal -- and thus they cannot meet the standard for obtaining mandamus relief. See Ex parte Lewis, 571 So.2d 1069, 1075 (Ala. 1990) (Maddox, J., dissenting) (recognizing that mandamus "obviously would not be available if there was a right of appeal").

         The named plaintiffs are correct insofar as they argue that a party can no longer seek appellate review of a trial court's class-certification order by filing a petition for the writ of mandamus; § 6-5-642 governs such challenges and provides that an appeal is the appropriate vehicle by which to bring that issue before this Court. Nevertheless, we decline the named plaintiffs' invitation to deny the Commission officers' petition on this basis. We instead exercise our discretion under the Rules of Appellate Procedure to treat the Commission officers' petition for a writ of mandamus as a notice of appeal. See Kirksey v. Johnson, 166 So.3d 633, 643 (Ala. 2014) (noting that "[t]his Court has treated a notice of appeal as a petition for a writ of mandamus ... and, conversely, treated a petition for a writ of mandamus as a notice of appeal"); Rule 1, Ala. R. App. P. ("[These rules] shall be construed so as to assure the just, speedy, and inexpensive determination of every appellate proceeding on its merits."); and Rule 2(b), Ala. R. App. P. ("In the interest of expediting decision, or for other good cause shown, an appellate court may suspend the requirements or provisions of any of these rules in a particular case on application of a party or on its own motion and may order proceedings in accordance with its direction ...."). Accordingly, we treat the Commission officers' petition for the writ of mandamus as a notice of appeal, and we apply the standard of review applicable to all appeals brought pursuant to § 6-5-642. We have explained that standard as follows:

"'"This Court has stated that 'class actions may not be approved lightly and ... the determination of whether the prerequisites of Rule 23[, Ala. R. Civ. P., ] have been satisfied requires a "rigorous analysis."'" Mayflower Nat'l Life Ins. Co. v. Thomas, 894 So.2d [637] at 641 [(Ala. 2004)] (quoting Ex parte Citicorp Acceptance Co., 715 So.2d 199, 203 (Ala. 1997)). "In reviewing a class-certification order, this Court looks to see whether the trial court exceeded its discretion in entering the order; however, we review de novo the question whether the trial court applied the correct legal standard in reaching its decision." University Fed. Credit Union v. Grayson, 878 So.2d 280, 286 (Ala. 2003). Furthermore,
"'"[w]e note that an abuse of discretion in certifying a class action may be predicated upon a showing by the party seeking to have the class-certification order set aside that 'the party see ki ng clas s action certification failed to carry the burden of producing sufficient evidence to satisfy the requirements of Rule 23.' Ex parte Green Tree Fin. Corp., 684 So.2d 1302, 1307 (Ala. 1996). Thus, we must consider the sufficiency of the evidence s ubmitted b y the plaintiff[s]...."
"'Compass Bank v. Snow, 823 So.2d 667, 672 (Ala. 2001). See also Smart Prof'l Photocopy Corp. v. Childers-Sims, 850 So.2d 1245, 1249 (Ala. 2002) (holding that if plaintiffs fail to meet the evidentiary burden as required by Rule 23, Ala. R. Civ. P., then the trial court exceeds its discretion in certifying a class action). If the plaintiffs here have failed to meet the evidentiary burden as required by Rule 23, then the trial court exceeded its discretion in certifying a class action.'
"Eufaula Hosp. Corp. v. Lawrence, 32 So.3d 30, 34-35 (Ala. 2009)."

CVS Caremark Corp. v. Lauriello, 175 So.3d 596, 604 (Ala. 2014). Thus, to determine whether the trial court exceeded its discretion in certifying the named plaintiffs' claims for class-action treatment, we must determine whether the named plaintiffs met their burden of establishing that the requirements of Rule 23 were met. See also § 6-5-641(e), Ala. Code 1975 ("When deciding whether a requested class is to be certified, the court shall determine, by employing a rigorous analysis, if the party or parties requesting class certification have proved its or their entitlement to class certification under [Rule 23]. The burden of coming forward with such proof shall at all times be on the party or parties seeking certification ...."). We note, however, that the Commission officers' arguments challenging the subject-matter jurisdiction of the trial court -- which arguments may be asserted at any time, Poiroux v. Rich, 150 So.3d 1027, 1038 (Ala. 2014) -- are subject to de novo review. DuBose v. Weaver, 68 So.3d 814 (Ala. 2011).

         III.

         Inasmuch as the Commission officers have asserted that they are protected from suit by the doctrine of State immunity and that argument implicates the subject-matter jurisdiction of the trial court, we address that argument before considering whether the trial court exceeded its discretion in certifying the named plaintiffs' claims for class-action treatment. See Wyeth, Inc. v. Blue Cross & Blue Shield of Alabama, 42 So.3d 1216, 1219 n. 5 (Ala. 2010) ("Because standing does implicate subject-matter jurisdiction, we address it before considering whether [the appellee] has demonstrated the elements necessary for class certification under Rule 23, Ala. R. Civ. P."). The Commission officers argue specifically that State immunity bars the named plaintiffs' retrospective-relief and individual-capacities claims, so we begin our analysis with a review of those claims.

         With regard to the retrospective-relief claim, the Commission officers argue that they are absolutely immune from suit under well established principles of State immunity and that the trial court accordingly should have dismissed this claim early in the litigation before even addressing the issue of class certification.[6] The doctrine of State immunity derives from Ala. Const. 1901, Art. I, § 14, which provides that "the State of Alabama shall never be made a defendant in any court of law or equity." This Court has explained that, under § 14, not only do the State and its agencies have absolute immunity from suit in any court, but State officers and employees, in their official capacities and individually, also are immune from suit when the action against them is, in effect, one against the State. Phillips v. Thomas, 555 So.2d 81, 83 (Ala. 1989). In Alabama Department of Transportation v. Harbert International, Inc., 990 So.2d 831, 839 (Ala. 2008), this Court explained that whether a claim asserted against a State officer is effectively a claim against the State hinges on

"'whether "a result favorable to the plaintiff would directly affect a contract or property right of the State," Mitchell [v. Davis, 598 So.2d 801');">598 So.2d 801, 806 (Ala. 1992)], whether the defendant is simply a "conduit" through which the plaintiff seeks recovery of damages from the State, Barnes v. Dale, 530 So.2d 770, 784 (Ala. 1988), and whether "a judgment against the officer would directly affect the financial status of the State treasury," Lyons [v. River Road Constr., Inc.], 858 So.2d [257] at 261 [(Ala. 2003)].'
"Haley [v. Barbour County], 885 So.2d [783] at 788 [(Ala. 2004)]. Additionally, '[i]n determining whether an action against a state officer is barred by § 14, the Court considers the nature of the suit or the relief demanded, not the character of the office of the person against whom the suit is brought.' Ex parte Carter, 395 So.2d 65, 67-68 (Ala. 1980)."

         The Commission officers argue that this Court has previously applied these principles to hold that claims asserted against State officials seeking backpay allegedly owed are claims against the State and are therefore barred by the doctrine of State immunity. See, e.g., Alabama A & M Univ. v. Jones, 895 So.2d 867, 876 (Ala. 2004) (holding that State immunity barred a university professor's claim seeking backpay associated with promised raises that did not materialize). The Commission officers accordingly argue that the trial court erred by certifying the retrospective-relief claim for class- action treatment; instead, they argue, the trial court should have recognized the immunity afforded them by § 14 and dismissed this claim.

         The named plaintiffs, however, argue that State immunity does not apply to the retrospective-relief claim because, although that claim seeks the payment of money damages, the claim is, they say, at its core, simply an attempt to compel State officials to perform their legal duty or a ministerial act -- that duty or act being the payment of money class members are entitled to by the clear terms of the benefits statutes -- and such actions are not barred by § 14. See, e.g., Ex parte Alabama Dep't of Fin., 991 So.2d 1254, 1256-57 (Ala. 2008) (stating that "certain actions are not barred by § 14" including "actions brought to compel State officials to perform their legal duties" and "actions to compel State officials to perform ministerial acts"). In support of their argument that the retrospective-relief claim falls within those categories of actions not barred by § 14, the named plaintiffs rely almost exclusively upon Ex parte Bessemer Board of Education, 68 So.3d 782 (Ala. 2011); indeed, in its order certifying the retrospective-relief claim for class- action treatment, the trial court referred to this claim as "the Bessemer Board claim." Accordingly, we begin our analysis by reviewing the holding of Ex parte Bessemer Board of Education, which was summarized in Alabama State University v. Danley, 212 So.3d 112, 125-26 (Ala. 2016):

"At issue in Ex parte Bessemer Board was § 16-22-13.1, Ala. Code 1975, which provides the method of calculating percentage pay increases for public-education employees based on their years of experience. 68 So.3d at 786. Jean Minor, a teacher in the Bessemer School System, sued, among others, the members of the Bessemer Board of Education in their official capacities, alleging that her statutory pay increase had been miscalculated. 68 So.3d at 785. Minor sought backpay for the 2000-2001 fiscal year and sought to have her pay calculated correctly for the ensuing years pursuant to the guidelines in § 16-22-13.1. 68 So.3d at 786. The board members, claiming immunity, moved for either a dismissal of the complaint or a summary judgment. The trial court entered a judgment dismissing all claims against the board members on the basis of sovereign immunity, but after Minor filed a motion to alter or amend the judgment, the trial court vacated its earlier judgment and entered a new judgment in favor of Minor. In doing so, the trial court found that the board members were not entitled to immunity ...

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