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Austill v. Jul Prescott

Supreme Court of Alabama

July 12, 2019

Jere Austill III
v.
Tyler Montana Jul Prescott Tyler Montana Jul Prescott
v.
Jere Austill III

          Appeals from Baldwin Circuit Court (CV-16-900541)

          BRYAN, JUSTICE. [1]

         In case no. 1170709, Jere Austill III appeals from a judgment of the Baldwin Circuit Court ("the trial court") permitting Tyler Montana Jul Prescott to redeem certain real property under §§ 40-10-82 and 40-10-83, Ala. Code 1975. Specifically, Austill argues that, through adverse possession, he had "cut off" Prescott's right to redeem the property. Because we conclude that, by virtue of an adverse judgment in an earlier quiet-title action, Austill is precluded by the doctrine of res judicata from claiming an interest in the property through the extinguishment of Prescott's right of redemption, we affirm the portion of the trial court's judgment that is challenged in Austill's appeal.

         In case no. 1170730, Prescott cross-appeals from the trial court's denial of his motion for an award of attorney fees under the Alabama Litigation Accountability Act ("the ALAA"), § 12-19-270 et seq., Ala. Code 1975, arguing that Austill asserted his argument that he cut off Prescott's right of judicial redemption without substantial justification. We conclude that the trial court did not exceed its discretion in denying Prescott's motion, and we affirm that portion of the trial court's judgment.

         Background

         As noted above, this case involves Prescott's request to redeem certain real property located in Baldwin County ("the property") under §§ 40-10-82 and 40-10-83 and whether his right to redeem the property had been cut off. In First Properties, L.L.C. v. Bennett, 959 So.2d 653, 654 (Ala. Civ. App. 2006), the Court of Civil Appeals summarized Alabama's redemption law:

"Under Alabama law, after a parcel of property has been sold because of its owner's failure to pay ad valorem taxes assessed against that property (see § 40-10-1 et seq., Ala. Code 1975), the owner has two methods of redeeming the property from that sale: 'statutory redemption' (also known as 'administrative redemption'), which requires the payment of specified sums of money to the probate judge of the county in which the parcel is located (see § 40-10-120 et seq., Ala. Code 1975)[2], and 'judicial redemption' under §§ 40-10-82 and 40-10-83, Ala. Code 1975, which involves the filing of an original civil action against a tax-sale purchaser (or the filing of a counterclaim in an ejectment action brought by that purchaser) and the payment of specified sums into the court in which that action or counterclaim is pending. See generally William R. Justice, 'Redemption of Real Property Following Tax Sales in Alabama,' 11 Cumb. L. Rev. 331 (1980-81)."

         In 2007, JSW Properties, LLC ("JSW"), owned the property. JSW did not pay the ad valorem taxes associated with the property, and, in 2008, the property was sold at a tax sale to Plymouth Park Tax Services, LLC ("Plymouth Park"). Plymouth Park later transferred its interest in the property to Propel Financial 1, LLC ("Propel"). Neither Plymouth Park nor Propel paid the required ad valorem taxes associated with the property for 2011, and in 2012 Austill purchased the property at a tax sale and obtained a certificate of purchase. See § 40-10-19(a), Ala. Code 1975 ("As soon after the confirmation of sale is made as may be practicable, the tax collector must make out and deliver to each purchaser ... a certificate of purchase ...."). Later that month, Austill visited the property and installed a no-trespassing sign and four stakes with survey flags at the four corners of the property. See § 40-10-74, Ala. Code 1975 ("Any purchaser of lands at a tax sale other than the state or anyone claiming under him shall be entitled to possession of said lands immediately upon receipt of certificate of sale from the tax collector ....").

         In June 2015, the Baldwin County Probate Judge delivered a tax deed for the property to Austill. See § 40-10-29, Ala. Code 1975 ("After the expiration of three years from the date of the sale of any real estate for taxes, the judge of probate then in office must execute and deliver to the purchaser ... a deed to each lot or parcel of real estate sold to the purchaser ...."). Propel later transferred its interest in the property to Prescott. Although JSW had been dissolved, its "successor in interest" also later conveyed to Prescott JSW's interest in the property via quitclaim deed. By letter dated December 19, 2015, Prescott informed Austill of his intent to redeem the property.

         I. The Quiet-Title Action[3]

         On December 29, 2015, Austill filed a verified complaint initiating a quiet-title action "to establish the right and title of [Austill] to [the property] and to clear up all doubts or disputes concerning the same ...." ("the quiet-title action"). Among others, Austill named Prescott as a defendant in the action. Austill sought a judgment declaring that he possessed "the entire and undivided fee simple interest in the [property] with no restrictions thereon."

         Among other things, Austill alleged that, since the 2012 tax sale, he had been in adverse possession of the property. Austill stated: "This matter is brought pursuant to ... § 40-10-82." Section 40-10-82 provides:

"No action for the recovery of real estate sold for the payment of taxes shall lie unless the same is brought within three years from the date when the purchaser became entitled to demand a deed therefor; but if the owner of such real estate was, at the time of such sale, under the age of 19 years or insane, he or she, his or her heirs, or legal representatives shall be allowed one year after such disability is removed to bring an action for the recovery thereof; but this section shall not apply to any action brought by the state, to cases in which the owner of the real estate sold had paid the taxes, for the payment of which such real estate was sold prior to such sale, or to cases in which the real estate sold was not, at the time of the assessment or of the sale, subject to taxation. There shall be no time limit for recovery of real estate by an owner of land who has retained possession. If the owner of land seeking to redeem has retained possession, character of possession need not be actual and peaceful, but may be constructive and scrambling and, where there is no real occupancy of land, constructive possession follows title of the original owner and may only be cut off by adverse possession of the tax purchaser for three years after the purchaser is entitled to possession."

(Emphasis added.)

         Acting pro se, Prescott answered Austill's complaint, quoting from the first sentence of § 40-10-82 and arguing that Austill had filed his complaint "prematurely" because he had not adversely possessed the property for three years after becoming entitled to demand a tax deed. Prescott also filed a motion to dismiss Austill's complaint, which elaborated on his answer, citing as support Southside Community Development Corp. v. White, 10 So.3d 990 (Ala. 2008), and McGuire v. Rogers, 794 So.2d 1131 (Ala. Civ. App. 2000). In McGuire, 794 So.2d at 1136, the Court of Civil Appeals quoted from its decision in Ervin v. Amerigas Propane, Inc., 674 So.2d 543, 544 (Ala. Civ. App. 1995), which, in turn, quoted from this Court's decision in Gulf Land Co. v. Buzzelli, 501 So.2d 1211, 1213 (Ala. 1987).

         In Buzzelli, this Court stated:

"We have stated many times that the purpose of § 40-10-83[4] is to preserve the right of redemption without a time limit, if the owner of the land seeking to redeem has retained possession. This possession may be constructive or scrambling, and, where there is no real occupancy of the land, constructive possession follows the title of the original owner and can only be cut off by the adverse possession of the tax purchaser. Stallworth v. First Nat. Bank of Mobile, 432 So.2d 1222 (Ala. 1983); Hand v. Stanard, 392 So.2d 1157 (Ala. 1980); O'Connor v. Rabren, 373 So.2d 302 (Ala. 1979).
"Code 1975, § 40-10-82, does establish a 'short statute of limitations' for tax deed cases. This section states that the redemption action must be filed within three years from the date when the purchaser became entitled to demand a deed for the property. We have held that this statute does not begin to run until the purchaser is in adverse possession of the land and has become entitled to demand a deed to the land. Williams v. Mobile Oil Exploration, 457 So.2d 962 (Ala. 1984). In order for the short period of § 40-10-82 to bar redemption under § 40-10-83, the tax purchaser must prove continuous adverse possession for three years after he is entitled to demand a tax deed. Stallworth, 432 So.2d at 1224."

501 So.2d at 1213 (emphasis added). Austill filed a response to Prescott's motion to dismiss, challenging, among other things, the legal basis for Prescott's motion to dismiss and citing in support of his argument, in addition to other cases, Southside; Reese v. Robinson, 523 So.2d 398 (Ala. 1988); Buzzelli; O'Connor v. Rabren, 373 So.2d 302 (Ala. 1979); and McGuire. The trial court denied Prescott's motion to dismiss.

         With the assistance of counsel, Prescott later filed a "renewed motion to dismiss," pursuant to Rule 12(b)(6), Ala. R. Civ. P., and an accompanying "brief," arguing, among other things:

"In order to quiet title to real property under a tax deed, [Austill] must show that no party has the right to redeem the property from the tax sale. In order to foreclose all redemptive rights, the holder of a tax deed must prove that it adversely possessed the property for a period of three years after becoming entitled to demand a tax deed. ... Buzzelli, 501 So.2d [at] 1213 .... [Austill] has been in possession for four years, but only one of those years came after [Austill] became entitled to demand a tax deed, and this is why the case should be dismissed. Our State's laws regarding a party's rights under a tax deed might be confusing, but they are well settled and the rule that applies in this case is clear."

(Emphasis original.) In support of his argument, Prescott cited, among other cases, Reese; Buzzelli; Karagan v. Bryant, 516 So.2d 599 (Ala. 1987); and Hand v. Stanard, 392 So.2d 1157 (Ala. 1980).

         Austill filed a response to Prescott's renewed motion to dismiss, in which he argued, among other things:

"The Supreme Court has applied the rule in [Buzzelli] to require the purchaser of a tax deed to show that they have maintained continuous adverse possession of the tax-sale property for three years to defeat a right of redemption under [§] 40-10-82 without regard to possession by the redemptioner. Southside, supra ....
"[Austill, ] in the case at hand before this Court[, ] would allege that he has met the requirements of Southside, supra, in that he has maintained continuous adverse possession of the tax-sale property since on or about the date of purchase ...."

         The trial court conducted a hearing on Prescott's renewed motion to dismiss. On March 21, 2016, the trial court entered an order stating: "Based on the authority of Gulf Land v. Buzzelli, 501 So.2d 1211 (Ala. 1987), and subsequent case authority cited in [Prescott]'s brief, [the] motion to dismiss pursuant to Rule 12(b), filed by [Prescott] is hereby granted."

         Austill appealed to this Court. This Court transferred the appeal to the Court of Civil Appeals, pursuant to § 12-2-7(6), Ala. Code 1975. For the first time in his reply brief, [5]Austill argued that the addition of the last two sentences of § 40-10-82 by amendment effective September 1, 2009, altered the statute of limitations for judicially redeeming property.

         Specifically, Austill argued that the 2009 amendment to § 40-10-82 provides that the three-year statute of limitations for bringing a judicial-redemption claim begins running when the tax-sale purchaser is in adverse possession of the property and becomes entitled to possession of the property, as opposed to when the tax-sale purchaser becomes entitled to a tax deed. Because § 40-10-74 provides that a tax-sale purchaser becomes entitled to possession of the property "immediately upon receipt of a certificate of sale from the tax collector," Austill argued, the 2009 amendment to § 40-10-82 allows a tax-sale purchaser to "cut[] off" the original owner's right of judicial redemption after three years of adverse possession, starting from the point at which the tax-sale purchaser begins adversely possessing the property after obtaining a certificate of sale. Austill asserted: "In other words, by the time the tax deed is issued, both administrative and judicial redemption rights have been lost ...." Although the version of § 40-10-82 as amended in 2009 was in effect throughout the entirety of the quiet-title action and was argued and applied by the parties and the trial court, Austill did not assert an argument based on the language reflected in the 2009 amendment to § 40-10-82 until he filed his reply brief in the Court of Civil Appeals. Austill's reply brief also included citations to, among other cases, Southside, Reese, Buzzelli, Karagan, and McGuire.

         On January 6, 2017, the Court of Civil Appeals unanimously affirmed the trial court's judgment, without an opinion, citing, among other cases, Southside, Reese, and Buzzelli. Austill filed an application for rehearing, which the Court of Civil Appeals denied. With the assistance of new counsel, Austill then petitioned this Court for a writ of certiorari, pursuant to Rule 39(a)(1)(C), Ala. R. App. P., in which he asked this Court to consider the effect of the 2009 amendment to § 40-10-82 as a purportedly material question of first impression requiring a decision from this Court.[6] This Court denied Austill's petition on April 14, 2017, without an opinion.

         II. The Redemption Action

         In May 2016, shortly before Austill filed a notice of appeal from the trial court's judgment in the quiet-title action, Prescott initiated a separate judicial-redemption action ("the redemption action") in the trial court and, in his complaint, expressed his intent to pay into the trial court the funds required to redeem the property under § 40-10-83. On June 21, 2016, the attorney who represented Austill in the trial court and in the Court of Civil Appeals in the quiet-title action filed a motion to stay proceedings in the redemption action pending a disposition of Austill's appeal in the quiet-title action. Prescott filed a response to Austill's motion, agreeing that the disposition of Austill's appeal in the quiet-title action would affect the outcome of the redemption action and consenting to a stay of proceedings in the redemption action. The trial court entered an order granting Austill's motion.

         After this Court denied Austill's petition for a writ of certiorari in the quiet-title action, Austill, with the assistance of his new counsel, filed an answer in the redemption action on April 18, 2017. Among other things, Austill again argued, as he had in the quiet-title action, that he had extinguished Prescott's right of redemption by adversely possessing the property. This time, however, he asserted his argument regarding the effects of the 2009 amendment to § 40-10-82 that he had raised for the first time in his reply brief to the Court of Civil Appeals in the quiet-title action and again in his petition asking this Court for certiorari review of the Court of Civil Appeals' decision.

         Prescott moved for a summary judgment, again asserting, among other things, that he should be allowed to redeem the property, citing as support many of the cases he had cited in the quiet-title action. The trial court denied Prescott's summary-judgment motion. Prescott then filed a "renewed motion for summary judgment" and attached the record from the quiet-title action and the parties' appellate briefs to his motion, asserting, among other things, that, based on the doctrines of res judicata and collateral estoppel, the trial court's judgment in the quiet-title action barred Austill from arguing that he had extinguished Prescott's right of judicial redemption through adverse possession.

         The trial court denied Prescott's renewed summary-judgment motion and set the case for trial. During the ensuing bench trial, Prescott moved for an award of attorney fees under the ALAA, arguing that, because the trial court had dismissed Austill's complaint in the quiet-title action, the arguments asserted by Austill in the redemption action were groundless in fact and in law.

         On March 20, 2018, the trial court entered a judgment determining, among other things, that Prescott was entitled to redeem the property and that Austill had "not taken sufficient action to extinguish or foreclose [Prescott]'s redemptive rights." The trial court also denied Prescott's request for an award of attorney fees under the ALAA. Austill appealed; Prescott cross-appealed, challenging the denial of his request for attorney fees.

         Analysis

         On appeal, Austill argues that the trial court erred by allowing Prescott to redeem the property because, Austill asserts, the language added to § 40-10-82 by the 2009 amendment, specifically the last sentence of § 40-10-82, permitted Austill to cut off Prescott's right of judicial redemption by adversely possessing the property for three years following the 2012 tax sale. In response, Prescott argues, among other things, that Austill is barred by the doctrines of res judicata and collateral estoppel from raising that argument because, Prescott asserts, Austill's claim that he has extinguished Prescott's right of redemption through adverse possession was already decided against Austill in the quiet-title action. Prescott states: "By the time this lawsuit is concluded, Prescott will have litigated the exact same issue, through appeal, twice." Prescott's brief, at 26-27. Although the portion of the trial court's judgment permitting Prescott to redeem the property addressed the merits of Austill's argument regarding the 2009 amendment to § 40-10-82[7] and was not based on the doctrines of res judicata or collateral estoppel, Prescott argues that we should affirm the trial court's judgment based on those doctrines. Prescott contends in his cross-appeal that Austill's argument is groundless in fact and in law and, therefore, that the portion of the trial court's judgment denying his request for an award of attorney fees under the ALAA should be reversed.

         I. Austill's Appeal (no. 1170709)

         We first address Prescott's argument that the doctrine of res judicata procedurally bars Austill from asserting the argument raised in his appeal, i.e., that the language added to § 40-10-82 by the 2009 amendment permitted him to extinguish Prescott's right of redemption under the facts of this case. In Lee L. Saad Construction Co. v. DPF Architects, P.C., 851 So.2d 507, 516-17 (Ala. 2002), this Court explained:

"Res judicata and collateral estoppel are two closely related, judicially created doctrines that preclude the relitigation of matters that have been previously adjudicated or, in the case of res judicata, that could have been adjudicated in a prior action.
"'The doctrine of res judicata, while actually embodying two basic concepts, usually refers to what commentators label "claim preclusion," while collateral estoppel ... refers to "issue preclusion," which is a subset of the broader res judicata doctrine.'
"Little v. Pizza Wagon, Inc., 432 So.2d 1269, 1272 (Ala. 1983)(Jones, J., concurring specially). See also McNeely v. Spry Funeral Home of Athens, Inc., 724 So.2d 534, 537 n.1 (Ala. Civ. App. 1998). In Hughes v. Martin, 533 So.2d 188 (Ala. 1988), this Court explained the rationale behind the doctrine of res judicata:
"'Res judicata is a broad, judicially developed doctrine, which rests upon the ground that public policy, and the interest of the litigants alike, mandate that there be an end to litigation; that those who have contested an issue shall be bound by the ruling of the court; and that issues once tried shall be considered forever settled between those same parties and their privies.'

"533 So.2d at 190. The elements of res judicata are

"'(1) a prior judgment on the merits, (2) rendered by a court of competent jurisdiction, (3) with substantial identity of the parties, and (4) with the same cause of action presented in both actions.'

"Equity Res. Mgmt., Inc. v. Vinson, 723 So.2d 634, 636 (Ala. 1998). 'If those four elements are present, then any claim that was, or that could have been, adjudicated in the prior action is barred from further litigation.' 723 So.2d at 636. Res judicata, therefore, bars a party from asserting in a subsequent action a claim that it has already had an opportunity to litigate in a previous action."

         Austill agrees with Prescott that elements (2) and (3) of the doctrine of res judicata are satisfied in this case. Regarding element (1), a prior judgment on the merits, Austill briefly discusses two decisions from this Court. One of those decisions, he says, supports a conclusion that the trial court's judgment in the quiet-title action dismissing that action under Rule 12(b)(6) did not constitute a judgment on the merits.

         Austill first acknowledges that this Court's decision in Sprinkle v. Edwards, 848 So.2d 217, 219 (Ala. 2002), noted:

"The United States Supreme Court has stated that '[t]he dismissal for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6) is a "judgment on the merits"' for res judicata purposes. Federated Dep't Stores, Inc. v. Moitie, 452 U.S. 394, 399 n.3, 101 S.Ct. 2424, 69 L.Ed.2d 103 (1981)(citing Angel v. Bullington, 330 U.S. 183, 190, 67 S.Ct. 657, 91 L.Ed. 832 (1947), and Bell v. Hood, 327 U.S. 678, 66 S.Ct. 773, 90 L.Ed. 939 (1946)). Thus, a dismissal for failure to state a claim pursuant to Federal Rule 12(b)(6) is generally preclusive."

(Emphasis added.) Austill then apparently argues that Sprinkle does not stand for the proposition that a judgment granting a motion to dismiss filed pursuant to Rule 12(b)(6) of the Alabama Rules of Civil Procedure constitutes a judgment on the merits for res judicata purposes.

         In support of his argument, Austill cites Ex parte Scannelly, 74 So.3d 432, 438 (Ala. 2011), in which this Court stated:

"'The Rule 12(b)(6) motion ... must be distinguished from a motion for summary judgment under Rule 56, which goes to the merits of the claim -- indeed, to its very existence -- and is designed to test whether there is a genuine issue of material fact. The Rule 12(b)(6) motion ... only tests whether the claim has been adequately stated in the complaint. Thus, ... on a motion under Rule 12(b)(6), the [trial] court's inquiry essentially is limited to the content of the complaint; a motion for summary judgment, on the other hand, often involves the use of pleadings, depositions, answers to interrogatories, and affidavits.'
"5B Charles Alan Wright & Arthur C. Miller, Federal Practice and Procedure § 1356, at 372-75 (3d ed. 2004)(footnote omitted)."

(Emphasis omitted.) Austill asserts that Scannelly is "the better case ..., which clearly says that a 12(b)(6) motion does not have preclusive effect." Austill's reply brief, at 21.

         Scannelly, however, did not hold that a dismissal under Rule 12(b)(6) is not a judgment on the merits for res judicata purposes. Scannelly involved a plaintiff's purported unilateral dismissal, pursuant to Rule 41(a)(1), Ala. R. Civ. P., of a complaint she had filed in the circuit court. The circuit court later reinstated the plaintiff's action after noting that, before the plaintiff submitted her notice of dismissal, the defendant had filed a motion to dismiss pursuant to Rule 12(b)(6) based on, among other things, the doctrine of res judicata. The circuit court concluded that the defendant's motion to dismiss amounted to a motion for a summary judgment, the filing of which prevented the plaintiff from thereafter unilaterally dismissing her complaint. The plaintiff petitioned this Court "for a writ of mandamus directing the [circuit court] to vacate all orders entered after [the plaintiff] filed a notice of dismissal pursuant to Rule 41(a) ... and for a writ of prohibition restraining that court from future attempts to exercise jurisdiction over [the plaintiff]'s case." Scannelly, 74 So.3d at 433.

         We denied the plaintiff's petition. In so doing, we discussed the distinction between a motion to dismiss filed pursuant to Rule 12(b)(6) and a summary-judgment motion, as is demonstrated by the portion of the opinion Austill cites in support of his argument. We also noted that the doctrine of res judicata is more commonly raised in the summary-judgment context, as opposed to the motion-to-dismiss context. We held:

"Thus, despite [the defendant]'s assertions that his motion was a Rule 12(b)(6) motion to dismiss, a review of the substance of the motion shows that it was, in part, a motion seeking a summary judgment based on the affirmative defense of res judicata. Because at the time [the plaintiff] filed her notice of dismissal pursuant to Rule 41(a)(1), [the defendant] had moved for a summary judgment, [the plaintiff] was deprived of the unqualified right to voluntarily dismiss her complaint pursuant to Rule 41."

Scannelly, 74 So.3d at 439. Therefore, contrary to Austill's assertions, Scannelly did not hold that a trial court's order granting a motion to dismiss filed pursuant to Rule 12(b)(6) does not constitute a judgment on the merits for the purposes of the doctrine of res judicata; indeed, that issue was not even presented or addressed in Scannelly. Scannelly's holding, therefore, is of no assistance to Austill.

         We conclude that the trial court's judgment granting the renewed motion to dismiss Prescott filed pursuant to Rule 12(b)(6) in the quiet-title action constituted a judgment on the merits of the quiet-title action. In his complaint in the quiet-title action, Austill sought a judgment declaring that, pursuant to § 40-10-82, he possessed "the entire and undivided fee simple interest in the [property] with no restrictions thereon." Prescott's answer and subsequent motions to dismiss in the quiet-title action generally denied Austill's claim to title through adverse possession under § 40-10-82 and, therefore, properly placed Austill's title to the property in issue in the quiet-title action. See Ally Windsor Howell, Tilley's Alabama Equity § 13:9 (5th ed. 2012)(citing Barry v. Thomas, 273 Ala. 527, 142 So.2d 918 (1962)); and Rushton v. McLaughlin, 213 Ala. 380, 382, 104 So. 824, 825 (1925).

         The trial court's judgment in the quiet-title action was expressly "[b]ased on the authority of ... Buzzelli ..., and subsequent case authority cited in [Prescott]'s brief," which, Prescott had argued, defeated Austill's claim to title to the property through adverse possession as a matter of law. Therefore, the trial court's judgment in the quiet-title action conclusively resolved the claim to title to the property that Austill had asserted therein. See Alabama Power Co. v. Laney, 428 So.2d 21, 23 (Ala. 1983)("The quiet title action is designed to 'clear up all doubts or disputes concerning [the land].' Anderson v. Moorer, 372 F.2d 747 (5th Cir. 1967)."); and United States v. Perry, 473 F.2d 643, 646 (5th Cir. 1973)("[I]t is clear that quiet title actions are intended to be as final and reliable as possible."). Thus, the trial court's judgment in the quiet-title action addressed the merits of the basis upon which Austill's complaint requested relief.

         Moreover, we note that the trial court's judgment in the quiet-title action did not specify whether the dismissal was with or without prejudice. Rule 41(b), Ala. R. Civ. P., discusses the effect of involuntary dismissals and states, in relevant part:

"Unless the court in its order for dismissal otherwise specifies, a dismissal under this subdivision and any dismissal not provided for in this rule, other than a dismissal for lack of jurisdiction, for improper venue, or for failure to join a party under Rule 19, operates as an adjudication upon the merits."

(Emphasis added.) The Court of Civil Appeals has interpreted the foregoing language to "necessarily include dismissals under Rule 12(b)(6)." Havis v. Marshall Cty., 802 So.2d 1101, 1103 n.2 (Ala. Civ. App. 2001).

         In Baker v. City of Guntersville, 600 So.2d 280, 282 (Ala. Civ. App. 1992), the Court of Civil Appeals reasoned that, for the purposes of applying the doctrine of res judicata, "[a] dismissal for failure to state a claim, as well as a dismissal with prejudice and a dismissal on the grounds that the facts and law show no right to relief, is a dismissal on the merits." See also Smith v. Union Bank & Trust Co., 653 So.2d 933, 935 (Ala. 1995)("If an action is dismissed 'without prejudice,' there is no adjudication on the merits of the case; the judgment does not bar another lawsuit on the same cause of action unless the words are qualified as to certain claims. In that circumstance, the dismissal would prevent relitigation of the claims not dismissed without prejudice, i.e., the claims dismissed with prejudice. See 50 C.J.S. Judgments § 635 (1947)."); and Calhoun v. Pennsylvania Nat'l Mut. Cas. Ins. Co., 676 So.2d 1332, 1334 (Ala. Civ. App. 1996)("A dismissal of an action with prejudice constitutes an adjudication on the merits that bars any subsequent litigation.").

         This Court has also noted that a judgment of dismissal can have preclusive effect. In Hester v. City of Birmingham, 402 So.2d 930 (Ala. 1981), multiple plaintiffs sued the City of Birmingham in the Jefferson Circuit Court. The circuit court dismissed the action. The plaintiffs later initiated another action using a substantially similar complaint. The City of Birmingham moved to dismiss the second action based on the doctrine of res judicata, and the circuit court granted the motion to dismiss.

         In affirming the circuit court's judgment, this Court reasoned:

"Res judicata clearly bars this action, which involves identical facts, identical parties, identical subject matter, and resulted in a judgment on the merits. As the Court recently said in McGruder v. B & L Construction Co., Inc., 331 So.2d 257 (Ala. 1976):
"'It has long been the policy in the courts of Alabama to provide a claimant a day in court, but he will not be allowed to continue to relitigate his claim. The underlying principle of res judicata or estoppel by judgment is based upon public policy and necessity, because it is to the interest of the state that there should be an end to litigation, and that the individual should not be vexed twice for the same cause. Savage v. Savage, 246 Ala. 389, 20 So.2d 784');">20 So.2d 784 [(1945)].
"'The doctrine of res judicata rests upon the primary principle that matters once adjudicated are settled and determined. Irwin v. Alabama Fuel & Iron Co., 215 Ala. 328, 110 So. 566');">110 So. 566 [(1926)]; Suggs v. Alabama Power Co., 271 Ala. 168, 123 So.2d 4');">123 So.2d 4 [(1960)]. Those cases are also authority for the rule that to sustain a plea of res judicata or judgment by estoppel, the parties must be the same, the subject matter the same, the point must be directly in question, and the judgment must be rendered on that point.
"'All of these elements were present in the first case, McGruder [v. B & L Construction Co.], 293 Ala. 354, 303 So.2d 103');">303 So.2d 103 [(1974)]. Appellant has had her day in court and the same issues were adjudicated, settled and determined, and this is dispositive of this case. We note that our cases also state that a judgment in a former action between the same parties is not only conclusive of the questions actually litigated, but [also of those] which could have been litigated in the former suit. Reid v. Singer Sewing Machine Co., 218 Ala. 498, 119 So. 229');">119 So. 229 [(1928)]; Hathcock v. Mitchell, 277 Ala. 586, 173 So.2d 576');">173 So.2d 576 [(1965)].'

"331 So.2d at 259." Hester, 402 So.2d at 931; see also First State Bank of Altoona v. Bass, 418 So.2d 865, 866 (Ala. 1982)(applying the holding of Hester in determining that a dismissal based on the doctrine of sovereign immunity constituted a judgment on the merits for the purposes of the doctrine of res judicata); and Parmater v. Amcord, Inc., 699 So.2d 1238, 1241 (Ala. 1997)("[T]his Court has also held that a dismissal with prejudice is an adjudication on the merits. ... The dismissal with prejudice concluded the rights of the parties, terminated the right of action, and precluded subsequent litigation of the same cause of action.").

         In light of the foregoing, we view the trial court's dismissal of Austill's complaint in the quiet-title action as a dismissal with prejudice. As such, the trial court's judgment of dismissal constituted a judgment on the merits of the quiet-title action for res judicata purposes. Therefore, we conclude that element (1) of res judicata is satisfied in this case.

         Austill also argues that Prescott fails to satisfy element (4), i.e., the requirement that "the same cause of action [be] presented in both actions," Lee L. Saad, 851 So.2d 507 at 517. Austill argues:

"In this case, Austill 1) did not bring the same claim, and 2) could not have feasibly brought the same [claim] of judicial redemption. Austill could not have possibly brought [a] judicial[-]redemption [claim] since he had no standing to redeem the property he never owned and thus never lost to a tax sale."

         Austill's reply brief, at 22. But Prescott did not argue that Austill was precluded from claiming title to the property through judicial redemption. Indeed, as Austill points out, the record is devoid of any evidence in either the quiet-title action or the redemption action indicating that Austill possesses a right of judicial redemption.

         Instead, Prescott argues that Austill is precluded from asserting the claim to title upon which Austill actually relies, i.e., an extinguishment of Prescott's right of redemption through Austill's adverse possession of the property. In other words, Prescott argues that, by asserting his argument that he has extinguished Prescott's right of redemption in the redemption action, Austill is attempting to relitigate the same dispute that was resolved in the quiet-title action. In Old Republic Insurance Co. v. Lanier, 790 So.2d 922, 928-29 (Ala. 2000), this Court noted the following regarding the "cause-of-action" element of res judicata:

"In Alabama '[i]t is well-settled that "the principal test for comparing causes of action [for the application of res judicata] is whether the primary right and duty or wrong are the same in each action."' Wesch v. Folsom, 6 F.3d 1465, 1471 (11th Cir. 1993)(emphasis added), cert. denied sub nom. Sinkfield v. Wesch, 510 U.S. 1046, 114 S.Ct. 696, 126 L.Ed.2d 663 (1994). 'Res judicata applies not only to the exact legal theories advanced in the prior case, but to all legal theories and claims arising out of the same nucleus of operative facts.' Id. (emphasis added). 'The question is whether the same evidence substantially supports both actions. ... It is considered the same cause of action when the same evidence is applicable in both actions.' Hughes v. Martin, 533 So.2d 188, 191 (Ala. 1988). As it is sometimes stated, '"[w]here two successive suits seek recovery for the same injury, a judgment on the merits operates as a bar to the later suit, even though a different legal theory of recovery is advanced in the second suit."' Silcox v. United Trucking Serv., Inc., 687 F.2d 848, 852 (6th Cir. 1982); Harrington v. Vandalia-Butler Bd. of Educ., 649 F.2d 434, 437 (6th Cir. 1981); see also Kale v. Combined Ins. Co. of America, 924 F.2d 1161, 1166 (1st Cir.), cert. denied, 502 U.S. 816, 112 S.Ct. 69, 116 L.Ed.2d 44 (1991)."[8]

         A review of the record on appeal clearly demonstrates that the disputes between the parties presented in the redemption action and the quiet-title action are based on the same nucleus of operative facts. As noted above, while Austill's appeal was pending in the quiet-title action, he moved for a stay of proceedings in the redemption action, which Prescott agreed was warranted. In his motion, Austill asserted:

"[Austill] would allege that, given the fact that this pending cause of action, as well as the previous case upon appeal, involve the same subject real property, issues and parties, that the Court cannot adjudicate this pending cause of action until such a time as the Court of Civil Appeals enters its decision on [Austill]'s appeal.
"... [S]ince the issues upon appeal will determine whether or not [Austill] does, in fact, have the legal right to demand qui[et] title to the subject real property, as well as determine [Prescott]'s legal standing to demand judicial redemption, [Prescott]'s rights in this pending cause of action to a possible judicial redemption of the subject real property cannot be determined or ascertained until such a time as [Austill]'s legal rights to the subject real property are finally adjudicated by the Court of Civil Appeals."

(Emphasis added.)

         Moreover, we note that Austill does not argue on appeal that the doctrine of res judicata, or claim preclusion, is inapplicable because the disputes between the parties presented in the quiet-title action and the redemption action were based on a different set of facts. In the portion of his reply brief addressing Prescott's argument based on the doctrine of collateral estoppel, Austill does argue that the evidence necessary to support a claim based on his interpretation of the language reflected in the 2009 amendment to § 40-10-82 is different than the evidence necessary to support a claim under the first sentence of § 40-10-82. Put another way, Austill argues that the "theory of [his] defense [in the redemption action] is different than the allegations made in the [quiet-title action]; Austill presents [in the redemption action] completely different arguments than those presented in [the] quiet[-]title [action]." Austill's reply brief, at 7 (emphasis added). He also states: "[A]lthough Austill believes that he has used a new theory of denying redemption, he obviously admits that he denied [Prescott's right of] redemption [in both actions]." Austill's reply brief, at 19 (emphasis added).

         As noted above, "'[r]es judicata applies not only to the exact legal theories advanced in the prior case, but to all legal theories and claims arising out of the same nucleus of operative facts.' Wesch v. Folsom, 6 F.3d 1465, 1471 (11th Cir. 1993)(emphasis added)." Lanier, 790 So.2d at 928. Both the quiet-title action and the redemption action dealt with the legal significance of the same nucleus of operative facts, i.e., Austill's purchase of the property at a tax sale, his subsequent possession of the property for a particular number of years, his acquisition of a tax deed, and Prescott's acquisition of the interests of the property's former owners.[9]

         In other words, as to the quiet-title action and the redemption action "'the primary right and duty or wrong are the same in each action.'" Lanier, 790 So.2d at 928 (quoting Wesch, 6 F.3d at 1471). As the foregoing summary of the procedural histories of the quiet-title action and the redemption action demonstrates, the dispute between Austill and Prescott has not changed from the quiet-title action to the redemption action. In the redemption action, each party relies, in large part, upon the same authority in support of his respective position regarding whether Austill had extinguished Prescott's right of redemption as he did in the quiet-title action. Among other cases, the parties still cite Southside, Reese, Buzzelli, Karagan, Hand, O'Connor, and McGuire in their appellate briefs. The only material element that differs between the actions is Austill's relatively newfound argument regarding the effect of the language added to § 40-10-82 by the 2009 amendment.

         In his reply brief, Austill spends several pages arguing that he could not have properly raised the significance of the 2009 amendment to § 40-10-82 in the quiet-title action. As noted above, however, Austill did, in fact, raise that argument in the quiet-title action, albeit perhaps too late. In this appeal, Austill argues that the 2009 amendment to § 40-10-82, specifically the last sentence,

"means that a tax purchaser may cut off the original owner's redemptive rights three years after the tax investor's possession of the property. ... Since ... ยง 40-10-74 gives a tax investor the right to possess the property as soon as the tax lien is purchased, the legislature intended the tax investor to be able to cut off ...

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