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Hartung Commercial Properties, Inc. v. Buffi's Automotive Equipment and Supply Company, Inc.

Supreme Court of Alabama

December 7, 2018

Hartung Commercial Properties, Inc.
Buffi's Automotive Equipment and Supply Company, Inc.

          Appeal from Mobile Circuit Court (CV-11-901557)

          BRYAN, JUSTICE.

         Hartung Commercial Properties, Inc. ("Hartung"), appeals from a summary judgment entered by the Mobile Circuit Court ("the circuit court") in favor of Buffi's Automotive Equipment and Supply Company, Inc. ("Buffi's Automotive"). For the reasons set forth herein, we reverse and remand.

         Facts and Procedural History

         Hartung was formed in early 2003 by Wayne Hartung, and, around that time, Hartung bought a piece of commercial property that had an auto-body collision, repair, and paint shop ("the body shop") on the premises. Wayne also formed Har-Mar Collisions, Inc. ("Har-Mar"), in late 2003 or early 2004 to operate the body shop. Hartung subsequently entered into a lease with Har-Mar pursuant to which Har-Mar leased the body shop. Wayne had a custom-built paint booth installed in the body shop and hired Buffi's Automotive to make the paint booth operational once it was installed. On January 24, 2011, the body shop was completely destroyed by a fire.

         On July 8, 2011, Hartung sued Har-Mar, Buffi's Automotive, and several fictitiously named defendants in the circuit court asserting claims of negligence and wantonness related to their alleged roles in causing the fire that destroyed the body shop. Specifically, Hartung alleged that, on or about January 5, 2011, Buffi's Automotive performed repairs to the paint booth located in the body shop that required "bypassing and/or overriding the safety cutoff and/or control regarding the heating system" of the paint booth; that Har-Mar continued to use the paint booth through January 24, 2011; and that, on or about January 24, 2011, a fire destroyed the body shop as a result of the negligence and wantonness of Har-Mar and Buffi's Automotive. Hartung subsequently amended the complaint to add Ira Lewis as a defendant.

         On September 6, 2013, Buffi's Automotive moved for a summary judgment as to all claims pending against it.[1]Buffi's Automotive alleged that, sometime after the fire destroyed the body shop, Hartung ordered what remained of the body shop and all the equipment inside it -- including the paint booth and all its electrical components -- to be demolished without notifying Buffi's Automotive that the body shop was going to be demolished and without giving Buffi's Automotive the opportunity to inspect the body shop or the paint booth before they were demolished. Buffi's Automotive argued that Hartung allowed the body shop to be demolished even though it believed at that time that Buffi's Automotive had caused the fire; that Buffi's Automotive "was named as a defendant only after the evidence was destroyed"; and that Buffi's Automotive "should have been placed on notice of the claim and allowed to inspect the premises with its own experts prior to destruction of the evidence."

         Har-Mar and Hartung filed separate motions opposing Buffi's Automotive's motion for a summary judgment, and they each adopted the arguments made in the other's opposition. See note 1, supra. Citing the fact that the fire scene "had already been inspected by a large group of experts" and that some of the experts who had examined the fire scene had not concluded that the cause or origin of the fire implicated Buffi's Automotive, Har-Mar argued that "Buffi's has offered no showing that with the information and resources available to it ... Buffi's [Automotive's] defense of this case is impaired in any manner by the clearing of the property." Hartung argued that Ira Lewis was "an agent, servant and/or employee of Buffi's [Automotive]" and that, because Lewis "inspected the fire loss and spoke with various law enforcement and fire experts" before the body shop was demolished, there was no "spoliation problem."

         The following evidence was presented to the circuit court. In early January 2011, approximately one week before the fire, Har-Mar telephoned Buffi's Automotive seeking a repair to the paint booth because the "oven" in the paint booth would not turn on. It is undisputed that Lewis came to the body shop that day and that, after speaking on the telephone with the company that had manufactured the paint booth, Lewis determined the cause of the problem in the paint booth. Although Lewis had to order a replacement part for the paint booth, there was evidence indicating that Lewis "hot-wired" the paint booth so that Har-Mar could continue using it until the replacement part arrived. The body shop was destroyed by the fire before Lewis was able to install the part.

         One of the insurance companies involved in investigating the fire hired Cam Cope to determine the origin and cause of the fire.[2] Cope inspected the scene on February 10 and 11, 2011. His initial assessment was that the fire occurred "within the heat exchanger that was used for the painting booth." Cope spoke to Lewis during his investigation, and Lewis told him that he had removed a faulty part from the paint booth and that he, essentially, "hot-wired" that component so Har-Mar could continue using the paint booth. Apparently, based on that conversation, Cope concluded that Lewis's faulty repairs to the paint booth caused the fire. Cope indicated that he believed the fire was caused by some type of electrical failure in the paint booth, but he admitted that he did not have an electrical engineer examine any part of the fire scene and that it was not within his area of expertise to determine exactly which electrical component had failed. Cope testified that he expected either Buffi's Automotive or Har-Mar "to get an electrical person there" and that he made that recommendation to the insurance company that had initially hired him.

         Lewis went to the body shop the day after the fire, and the manager of the body shop told Lewis that it could not have been the paint booth that caused the fire because the manager had turned off the breakers, i.e., the power, to the paint booth before he left the body shop the night of the fire. Lewis went to the body shop a second time a day or two after the fire to speak with certain individuals who were investigating the cause of the fire. A couple of weeks after the fire, Lewis went to the body shop with a camera because he thought he needed a picture of the breakers in the "off" position, but the breakers had already been removed from the scene. There is no indication in the record that Lewis actually took any photographs of the fire scene.

         Once Wayne's insurance companies informed him that their investigation of the fire scene was complete, Wayne hired someone to demolish the body shop and to clear the property. Wayne did not direct anyone to save any part of the paint booth or any electrical components that were still in the body shop. No part of the fire scene was preserved except the breaker box, which had already been removed; however, Wayne did not know where the breaker box was at the time of the underlying litigation. After the fire scene was cleared, Wayne was left "with a big vacant piece of property" with no structures remaining.

         There was undisputed evidence that the fire was investigated by the Mobile Fire Department, the Bureau of Alcohol, Tobacco, and Firearms ("ATF"), Cope, and Cliff Carlisle, who investigated the fire on behalf of an insurance company. Wayne testified that "a lot of pictures were taken" of the fire scene and that he knew that there were pictures of all the electrical components in the paint booth, although he conceded that the components themselves had not been preserved. Wayne testified that the fire marshal believed that the fire began in one of the vehicles parked inside the body shop but that the fire marshal ultimately held that the cause of the fire was undetermined.

         Wayne testified that the possibility that Lewis had "hot wired" the paint booth had come to his attention before the body shop was demolished. Wayne also testified that in his last conversation with Lewis after the fire, before the body shop was demolished, he told Lewis that Lewis "did something [he] shouldn't have done and [he] put me out of business."

         Buffi's Automotive, through Beth "Buffi" Peter, one of the owners, testified that Buffi's Automotive had no employees and that Buffi's Automotive had not done business with Wayne or Har-Mar since approximately September 2008. Beth stated that an entity known as "Ira Lewis Contracting" performed the repair work to the paint booth in January 2011. However, Lewis testified that he and Beth had been partners working on paint booths for approximately 10 years, that he and Beth shared office space, and that they worked on several jobs together after the fire at the body shop in January 2011. Lewis stated that both he and Beth referred to one another as partners in front of people they did business with and that, if the part needed to fix the paint booth had been delivered on time and was installed, Lewis would have expected to split the profits from that job with Beth. Wayne testified that "there hasn't ever been any separation between Buffi's [Automotive] and Ira, other than the woman's name being Buffi[, i.e., Beth]. We would call Buffi's [Automotive], we would get her and Ira, or her coming by for a bill."

         The circuit court conducted a hearing on the motion for a summary judgment on March 7, 2014. At that hearing, counsel for Hartung argued that Buffi's Automotive had not produced any expert testimony indicating that the information available, which was essentially the reports written and photographs taken by individuals who had investigated the fire, was insufficient for a defense. Buffi's Automotive argued that it was denied the opportunity to hire its own expert to investigate the cause and origin of the fire and that, because of Wayne's actions, it was left with no physical evidence to examine.

         On November 4, 2014, the circuit court entered a summary judgment in favor of Buffi's Automotive based on spoliation of the evidence. The circuit court found: (1) that "the evidence leaves no doubt that the evidence destroyed by Hartung and Har-Mar is essential to Buffi's [Automotive's] ... defenses in this case"; (2) that, given that Hartung and Har-Mar believed that Buffi's Automotive and/or Lewis was responsible for the fire, "the importance of preserving the scene should have been readily apparent"; (3) that "[f]undamental fairness dictates that Buffi's [Automotive] ... should have been placed on notice of the claim and allowed to inspect the premises with its own experts prior to the destruction of the evidence"; (4) that it was "convinced that there exist no alternative sources of the ...

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