Lawyer 11 87 web by Alabama State Bar Association

The Alabama

3",yer

\ \ \

"1I oIj~ . .jJ, \ I

The Union Bank Trust Department. Your Hometown Advantage. Come Horne1O Us. UNION BANK I

u:.1OS ""-'1(' n llSTco ~~In'...uJIA.\IA MDIMf.M r x

Schroeder, Hoffman and Thigpen on

ALABAMA EVIDENCE by William A. Schroeder, Jerome A. Ho ffman and Richard Thigpen

INTRODU CTORY PRI CE

$69 .96 AilljulD. ly $74 96

COIly"g'n • 1981, ~88 PAgal. S' • 9' I"", I; .., hSldl)Ound In ~IV" 9 NMY biola

_ _ _ Table 01 Cont.nt. _ __ , Obtaining, 0I 1ering and ObjeC Ting 10 E";dence · Compe Tonce • ExamlOaTlon ot WI Tn..... . Relevance and LimItaTIon, on tile AdmiUlon 01 Relevant EVIdence · Pflvllege • • Impeac'ln16r1t • ExPfn r ut,mOfl't' • Heauay • Authenllcatlon lind Idenltllcalion - RuIO' 901. 902. 903 • Specllli Rule, Aelellng 10 W"""g ' Th e BeS! EVldance Rule lind the Pllrol EVIdence RulO · Real af'ld OemOf'l&\lll\lvO EVldonce · Judicial Notice · Presumptions • Burdens 0 1 Prool and Per.uaalon

In this comprehensive 6lComination 01 Ihe rul es 01 Alabama Evidence, tho author, prasen t an in·depth discussion of all areas o f al/ldomlsrv prOCedurfU: Irom 11'10 rela llv81v Simple ways t o

object to eVidence thr ough compe tence. privileges. relevance, Impeachment. the besl ol/Idence rulo aM pOrOI OVldence. M $ny sec tions con t ein 8 discussion 01 Fedelal law and how it compel s& to Its AloblUl'Ill coun terpart . Case law 18 thoroughly clled

through ou t the book. An oxcellont ro l erance tool for both the Inexperienced end veteran lawyer!

About .... Autho... _ _ _ __ _ _ _ _ _ _ _ __ JIIome A Hollm.n ,_,"" IlOlft 110. e .... nd

W,II_ '" Scll,O«Iott •.,;.. 'MI<I hli 8 A Irld J 0 110m ,,.. U.. '....,ly olilltnool _ 11,. lL hi! I,om .... ~ .. d Llw 5e1'lOOl ~ t$ • ;",...btI 01 lite .........Ic." u ..... H-. 1"'01>1 (YIdMIc., CllrninotI PI~. tnd AdvocKy ,I It>e Un,_"ly 01 ... 11_ 1 * 1\1 11164 $on« lhen '" hu bIIn. PI(>I"W 01 uw ,I SOU ..... n IH,"";, Uno_."y kllCKll 01 Llw wf>tr, he ..ache. E~ end C, , _ PrOCIdIioe

e.. ......,...

1._

J 0 ,,_ I'" U_IIIY 01

~'P,'

HI •• ,

_ _ 01 tllol Alot>.mto Sill'" 0 ..........,...,.,n ..... the St... I" AIiOColt(W\ 01 C.II'",,,,, HI he. \111ft • - . - 0 1 'M II.-... SupI_

,,,tI

C..... II _ _ y C........,;II" .... C.'" PllChCl_ Ploct<M' tinCt ill ~'la',;wI In 1911 HI I.

c~"""IV' 1'101 ...... 01 ~.w. , II.. U",VIIII.ly 01 ... ~ School 01 uw _ . '" IPC"'. hllWlf\(lI • ...., Cwd "'004Oul'

AiC .... d TlIIlIIMn IIC.. _ hOI I'" Irw! "" ... "om I'" U...-"Iy 0' "'~'nd "'. J D h_ 1M UftI..... "W 01 ... ~ kllool 01 Law HI II"." II M I.om '1' ... U_.,ly .nd .Il<> "" llO (tl"""".'yllrom 1M Uno_ .. lYOI ...1............ . . - . . _ 01 'Il0l ... 1.1.01.... S .... I ......""'111"'" HI I. cu"""IV' P'ol...... 01 L.w II U.. U"'VlllIIW 01 Schllol lItw

. .1."'....

Buy Schroeder, Hoffmsn snd Thigpsrt on Alabama Evidence and get 30 % OFF any o f the trea l ises listed beJow : Gambill & Corley's Alabama law of Damage' · '982 (wI cur IUpp) "",7993' $55 ,95 M cCur/IlY & DaVIS' Alabama Divorce, Alimony & Child CUltody ·,982 (wI cur supp) ~7 9~ $47 ,55 Hansford's Til/flY '. Alabama Equity 2nd Ed, ·'985 1i 1895' $34.96 Hoff 's Alabelma limitations of Action' & Notice Provilion. ·,984 (wI cur supp) -$3795 $26,55 Hood, H8rdl & $RRd's Alabama Workmen'. Comp.neetion ·'982 (wI cur supp) ..... 9:;' $31 .46

1---- ANDIOR get 40 %

OFF any of "The Law In "

"series Jisted below:

----I

Je"fles & W,lkmson'$ Collection of Accounta - ' 981 {wi cur Supp J $:2& 9& $16.1 6 Wsllllall 's Corporation. - Formation With Forms "'981 (wI cur IUPP J S;;U; 96 $18 ,15 Hairs ton's Detinue, EKecution. & Mechanics' lIeml ·'980 (wI cur IUPP) ...$269& $18 .1 6 JII""IIS ' Enforcement of Security Intere.ts In PerIanal Property ·'980 (wI Cf,lr SI,lPP) ~",~,~9~9"'5 $16,1 5 Huskey & EfheledgtJ's Lendlord & Tenant - Breech 80 Remedle. ·1981 -&26 9S $1 6 .15 JII",,8$ ' Wrongful Deeth Actions ·'979 (wI CUI supp.J 52695 $16,16

Want fsst, sffic;tmt ssrlliC97 Call our toll-free WATS

1-800-241 - 3661

THE

W HARRISON COMPANY, PUBLISHERS 3110 C. e.. ln;

P.,~,

POli o. 1600 '

No. C 'O~ •.

0 '" 3009 1. 1600

87·/1.,7

The Alabama L1wyer

317

'l'he Alab~un11

3",yer

•

rle

VOL. 48 •

.....,_ _

...... wn. .... _ _ ... ~.

' ,0 10. 4.,.. _

()Olll."UlJ

AI " '01

_ " ' .........- l _

1M~rd""

II,lAlD 01 IDIIOU , .... . H .... - .

o.-(_)., _" ' '''' __

~ , ' ........ 11• • '''~

.,..... -' _N ,- _.. .. - . - . c...W..... -~_ _ . .c-I ~"' ,_ ·,_1 ...,_ = ~_ ~- -,QoI''''''-

_ _ ......'_._. • ........,.... . ... _

orllcns .......

CIool~.

I ...... _

On the coverThe! new United States COUrtMuloe. In

c-!AM-..-I_

..,_ ....<l . .....

.....

C , _. '- ' _ , . """" , ,...." CoI-

Birmingham, h~~ CM;C;upl\ld line!!

JUI"II! and hou.es the

U.S. DIMlld COUIt~ for the Nonhern

District

of AI~b;om~

Photograph by Thoma, C. McCf'I!SOI. • Moolllomt!fY IUOrrl(lV

Revie w of TRA r86-Changes in Corpo rate and Pe rsonal Taxes-by Joseph w. BlacJcburn ... . . . 332 The imp.1Ct of the Tax Reform Act will become mool nollccable in tax year 1987. The aCl inSlitutes sweeping changes In Ihe corporate and personal tax structure.

_ _-- ,- --.- GtH . ... , IN' <M.oM rlON r io _ _ , _.

___''''' _ ''' ___ '_""' "\OI'_ IoOoOf,-" ...." ..... A_ obor ...... ..., ........ _ ......... ""', "...... .,.,...."'..... ......._ """.. _ _ of ... - . ... ""' .... ~_

~"Ja"'''' ''''''

... .

-..... ,....,. _ . _",_ _ _ ... _ .... ....... n.. "~_

_.-

_t->w ............. '_ __ "1• 01 ___ __ "' ""_ __

... ...~

.. .

..... __ ... ..... _

........ . .,.,. _ .. ""-, .. ... '-~

, _-.!o.t

....w<

M _ _ ~~_ ' ,I~...-...._

"l'1'l>I"""'...." ..... uo_... lot ' ,S 0 . "_ ."" l o I '" SotIP_ ... U . ....... _ . ... .... """"" ... d " 'I I M'_)........ r ho ..... "" .... , ...,..

I<>! " I .... _ ........ U"'IN _ ..... \Jr>IOOII_ ...... _ _ _

"""" . ......... d,,,,,_ .... _

II ..... . \'N'

....... /lCMl>P .......

"""" ........ , AI

Postmajlct: Send address changes to The Alabama lawyer, P.O. Box

4156, Montgomery, Al36 10 1.

The

Alabam,l

Lawyer

The Comprehensive Gcneralliabil. ity Policy in Alabama- Coverage Provi sion s-by Christoph e r L. Mc ilwain ..... ... ....... 326 The provisions and exclusions contained in tnc standard form comprehensive general liability policy hiwe been the subject of Interpretation In a number of decisions reno dered by the appellate courts of Ihis state .

Bui lding Alabama's Courthousesby Samue l A. Rumore . .. . . 338 In the fi rst of an on-going seriesol ar1lcies, Sam Rumore, of the Birmingham Bar, provides an historical perspective of the court· hou~ of Jackson County.

INSID E THIS ISSUE Presldem's Page ............... Executive Direoor's Report ...... About Members, Among Firms ... l awyer Referral Service ......... cle opporlunltles. ...... Bar Briefs ..... .. ...... . .. Recem [)c(isions ....... l0C.11 Sar Associations & Presidents Young lawyers' Section .........

320 321 324 337 342 344 345 349 350

legislative Wrap-up ............ Rldlnl:l the CIrcuits . . . . . Book RevIew .......... Opinions o( Ihe General Coun:.el . Consult.Jnl'S Corner ......... MCLE News . ........ ,... . Disciplinary Report . . . . . . . .. Memorials ......... . ....... Classified Notices . . . .

351 354 356 357 359 360 362 364 366

319

President's Page PPOrtunities are d~loplng on se\oeral (ronts as we rnoYe Inlo the 198p-88 bar year. The ar sura nee of several of my predecessors thnt 1could count on the suppon of Ihe

$3,000,000, and stan·up costs 'M>uld run approximately $200.000. 10m King. Jr., and his Committee on local Bar Activities and Services 15 off and running. and members of Ihe committee members d the bar already has proven will be contacting local bilr associations 10 be mOST accurate. The hard work of throughout the state. This effon will help many of you is most evident, and the bar the state bar learn frOm you and, I hope, Is Indebted to you. assisl in communicallons among local The nev.ly-er:panded board of bar bars so good programs can be shared. I commissioners is in place and working already am seeing proJec1S In !iOOlC areas well. You have elected a dedicated group of the Slate which can be adopted In other of new commissioners. pl;}ces. I COt'T1tI'leIld 10 you this work of !he The IOlT" (Interest on L.;r.vyer Trust Ac.. local Bar Activities and Services Comcounts) Commlu(!e, headed by Rowena mittee. Teague, and the Alabama Law foundaI have appointed a task force to make tion, chaira! by John Scott, nilVC been recommendacions as to a gn:ming PrObworking together to place In oper.llion the lem relating to represenlation of persons IOLTA progJ1lm, The bar commission HARRIS on de;uh row. There arc <M!r 90 people authorized a CQnlr<lI;1 with the foundation under death sentence In Alabama. The for an employee to work for the foundation, This person bars of Florid;! Clnd Georgi" hC1\lC dt.'VClopt.od programs to will d~lop materials needt!d 10 Implement IOlTA, and pfOYide assistance 10 the clvillawycrs who are being called you will be receiving more explanation and Informallon. upon by the courts 10 pw.'ide representation In these sit· I ul'Bc each of you 10 panldpale In IOLTA. It will be easy uations. In those stales, resource centl!f1 hiIYC been for you to 00 and 11 is a worthwhile program. A11that will d~loped ilt law schools to PfOYlde suppon to appointed be required Is the completion of one shon form merely di· anomcys. rectlng the bank 10 conven your trUSlllc<:oont to iIn inter· In Florida, funds dlM!loped Ihrough the IOlTA program est.bearlng account. Otherwise, you wi ll handle your trust have aided In this process. This Is a difficult area, but it account Just as before. All reponing and transfer of interesl seems the bar should have a role In seeing thilt inmates' eartled on the account to the Alabama L1W Foundation will rights arc fully protected and, at the same time, assuring be handled by the bank. the syslem Is not abu~ . The Florida approach has led to N. Its mec:ling on $eptl!mber 25, 1967, the board of com· the oppolntment of counsel ,II a Stage early enough to help mlssiOOl!/'S authorized a shon surwy of the bar wIth respect alleviate the last·minute appeals situation. 10 the formation of a captive Insurance company, as a fol · As we go forward, I kno.v I will be calling on more and Iow-up to the OOiailed SUM!Y oIlasl (all. 'roo likely will haYe more of you 10 give again 01 your lime and talent to our received 1M SUM!Y by the lime this Issue of The Alabama profession. I know I C<ln conlinue 10 be confident Ihat you Lawyer IJOC'l to press and, i( you h:we not done §O, I UfBe are more than ready, when called upon, to contribute your you to respond right 1WoIiIy. The board of commissioners best efforts to.vard the imprcM!ment ol our pro!esslon which needs to hear from you in order to make a decision as to in turn promotes the general welfare of our Slate and the whether we should go forward to form a captive insurance publiCwhom we sef'\IC. Seeing the generous contributions company, owned by I~rs, to pfCNlde I)rofessionalliability of SO many of you makes serving as your president a Insurilnce. Capitalization of a captiw will require al least pleasure. •

320

,",ovcmber 1987

Executive Director's

Report

WHOA - get the horse before the cart!

t is hoped you have had an opportu-

nity to read my IOlTA comments In the September 1987 Alabama Law-

y(!ri If not, I urge you to do so. I also rec-

ommend you rcad Stilnley Weissman's

and Rowena Crocker's (now Teague) fine pieces on IO lTA III the September 1985 Alabama Lawyer. These sugseslions are made to Inform you about IOlTA :.nd clear up some of the concerns raised by the bar-wide mailing of the Alabama Soprt.'Ole Court's Ofdcr approving an lOll A program (or "1111>......,,,. lawyers. l owe you an apology and explanation

for Ihe memorandum scnt August 3, ac· companying the IOlTA and Client Secufity Fund orders. In my haste to get the orders Inlo your h<lndsln sufficient time

for thosc desiring 10 send comments to the supreme court by its Sepl(!mber 1

deadline. I failed to appreciate the lack of information available to the bar and

banking community. During our three-year eflon, our task force has met with wnking association officials, and, In fact, wnk auorneys served as members of h. Bankers ac· knowledged acceptance elsewhere of IOl TA programs and Indicated they ex· pec:led the program to reach Alabama. Unfonunately, we did 001 enCOUrage them te) gear UI) for IOlTA since we were nOI sum thl! coun would amend our Code) or Professional Responsibility to permit Interest·bearing trust accounts, and we did not know the final form an al>proved program would take. While the courl's action was a wei· corned one, the Uming for stan·up has been problematical. Simply stated, we could not get our program up and run· nlng by October I, 1987. There Is no question of our doing so by e><:tober 1, 1988, and, In fact, January I, 1988, is OUf

The Alabama Lawyer

a realistic date, with the flrslinteresl pay. ments being possible on March 30, 1988. I received 203 leiters In response to

my memorandum transmitting the IOlTA order. Those merely expressing the desire 10 "opt out" numbered 158. Twenty-sl" criticized the program, while anOther 17 Ol)ted out "for the present " but e"presscd positive views toward the program and wanted more Information. Two firms wanted to know how to immediately convert their trust accounts to the program. Many of thosI! opting out objected to the annual opt-aul requirement and the bar will recommend that the coon modify that feature. Also, there are technical banking language changcs needed to describe "demand " and "lntereSI·bcilfIng" accounts. Of 00 small concern is the lack of guidelines as to "nominal amounts" and "length of time on deposit. " The state bar will undertake an Intensive informational effon for financial Institutions and our members. Meanwhile, I want to shed mOrl! light on the IOl TA program. I do this aller roceiving positive and encouraging comments from many ollhose who Initially oped out but who, after a telephone call, have expressed support for the program. IOlTA simply allows an attorney or firm to conven a standard trust checking account into an intereSl-bcaring NOW type account which will generate Interest Income. The financial Institutions will send the interest directl~' 10 the Alabama law Foundation, 10<;., which administers the IOlTA program. Interest paid, aftcr the total adminiStrative cost is deducted from the total Interest earned, will be at the normal NOW account rate and ser·

HAMN ER

vl~ charges wlll be those routinely charged on such an account. There will be no tale consequences to the attorney, firm or client because the interest Is paid directly 10 the tax-exempt Alabama Law Foundation, Inc., using the foundation's tax IdentifiC<ltion number (6l-09S 1482) on all accountS (as p<1yee of the Interest). The IOlT~ program will not affect cur· rent trust ilc<;ounl practlee. Once you convert 10 or open an IOlTA. a<;count, you will go about your client trust prOle. tices as usual. Ttl(: confidential, flduclary relationship between attorney and client remains unchanged, and there are no new records to keep. Just as In Ihe paSt, Ihe decision whether client funds are nominal In amount or are to be held for a shon period of time will rest In the sound ludgment of each Iav.yer. When client funds are large enough or the time of deposit Is long enough to Justify the costs of opening. <;Ioslng and administering a separate interest-bearins account.

321

l{!Wyers should con tinue to establish in(livi(lufll ;lCCOun!S for the benefi t of those clients. IOLTA w ill have no effQCt on clien ts. From it clien t's perspecti Yt!, the placement of funds Is Irrelevant, because the program 1rl\() 1 ~ fund s an anomey otherwise Vv'Ould nal Invest In the clien t's beh(llf, However, if a client h(ls q uesti o ns, il should be explai ne(!the choice is between allowing fund s to sit idly in a check ing (IC(;Qunt or permilling those fund s to gcmerate inlerl!St to be used for worthwhile, law-related publlc service proje<:ts. Virtually no time will be required of P<lrticipaling atto rn eys and firms. The mechanics of (;onverting your a(;count arC simp le, and once done, no furth er lime or effort on your part is required. You will not need to change Ihe way you presently ,1(; COunt for your tru St deposi ts, and can probably continue to use the same bank, checks and accoun t number.

Conversion will be easy. The bar w ill proYide you with ~ n enrollment form as soon as the financia l lnsi liutions are (;a' pnble of handli ng the IOLTA accounts. You will send the original form to your participating bank or savings and loan association, and mall a copy of the completed enrollment form to the foundation 10 notify II of your participa ti on . Thef'@ are no known legal barriel'5 to banks or savings and l!)<Ins offering the IOLTA program, but there are practical problems primari ly In Ihe dala processing areas, w hich participating fi nancial institutions can overcome easily, Each will nee<! to develop and implement In· lernal procedures for opening ;md main· tainlng th e IOLTA ~ccounts, E~perience has shown the higl1ly competiti ve nature of financial instilutions will cause the vast majority of Iher'llto take necessary steps to offer such accounls. INc hope all lawyers and fi rm s with eligible trust accoun ts will participate.

Programs in 46 jurisdictions are working well. We ha\IC the benefit of thei r r'Ila· lerials to assist in getting o ur program up and v.(Irking in minim;!1 time, Additional· Iy, the fo undation has hired an administra tor, M s. Tracy Daniel, 10 facill tate th is process. Again, I al>ologlze for allowing " the cart to precede the horse" with my August Jrd tran smittal. I hope we wilt be on the rood to opera ti onal capacity when you read thi s. We w ill be contacting you in coming months to encourage p.lrtlci· patlon . The intereSt paid to OUf foundntlon wilt make possible the Impf(1Vemenl o f our sys tem of Justi ce and its admlnlstralion. If you have any ques tions, please contact Tracy Daniel nt bar head(luarters. INc would be happy to assist your fin ancial instituti on in accommoda ting the IOLTA program.

- Reginald T, Hamner •

LAWYERS HELPING LAWYERS (formerly the "Buddy Program") Wllh lhe number of ,lew anO"lCyS i",:: rea~in8 aJ){1 tho numbel of j0b5 dccreasing. more ~nd more aUorneys are going Into practice on their own and mls~lng the benellt of the counseling of more clq)Cllenood pract ilionCI$, The Alabama State Oar Commi ttee on local Oar Activities and Services Is sponSQrlng a program to provide newer bar members a fellow lawyer tJley may consul! II they conffol'\! D problem, need to ask a question or simply want directions 10 the courthouse. If you are a lawyer who recen tly has begun 8 I)rilctlce Md would like} to mctl a lawyer in your area 10 call on OCCiislonillly (or a hand, Or if you ilre Ihe more experienced practitioner wllh v~ l ullble InlOI"""lon (ln d ooylce yov are willing to share, plcase complete and return IhlS form , Your I><Irticipallon in this pmglilm will benefi t Ihe entire bar.

LOCAL BAR ACTIVITIES AND SERVICES LAWYERS HELPING LAWYERS PROGRAM APPLICATION Name Firm Name (i f appli cabl e) _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __

Address Slale' _ _ _ _ _ _ _ __

Ci ty

Zip _ _ _ _ _ _ __

11 New l awyer

Te lephone _ _ _ _ _ __ __

[ ] Experienced l awyer

Pl ease return to: Alabama State 8<1', P.O, 80x 41 56, Montgomery, Alabama 36101 322

November 1987

Editorial (The views expressed here are Ihose of the aUlhor lwcl nOI necessarily those of the

bar, ils officers or members.)

September 2S, 191J7 Optn leiter to Jimmy Clark Speaker o f the House of Represenlativet

Alabama State le&lslalure Montgomery, Al Dear Mr. Cla rk: Normally when I have wri tten open letters to the Governor or leIters \0 the

editor about politics in Alabama, I have sprink led humor in the contex t of my

views 50 those who read them would be more prone to think about the subject mattcr C!'.'C!n If lhe-,' disagll:f.'d wi th me. There will be no humor in Ihisopen let-

ter 10 you because after reildi ng the ~r batlm transcript of your inTerview wITh

the edllor at THE BEDEVILED AD\.OCATE dilled September 15 of this year, you have fri ghtened me 3S a ci tizen and noulve of our great State. I am referring to your

rernilrks concerning the upcoming elec· tiOn ~;Ir imd the five ... Iabama Supreme Court Justices who mUSI run for reelec· tion at that l ime. Specifically, you said: ~ NEXT YEAR, YOU HAVE FIVE OF THOSe JUSTICES UP AND IT IS Go. INC TO BE A KNOCI(.(}(MIN·DRAGOUT TO TURN THAT COURT AROUND. ... TO HAVE A MAJORITY ON THERE. WHAT IS GOING TO HAf'PEN IS TIIAT THE BUSINESS FOLKS AREGOING TO FOLlO\oV UP JUST LIKE THEY DID ON TORT REFORM. TH EY ARE GOING TO BE DAMN HOT POTATOES NEXT SP R I NG.~

"THOSE LAWYERS ARE ALL IN CAHOOTS WITH THE DAMN JUOCES, IT IS A BROTHERHOOD TYPE OEAL OUT THERE ... PEOPLE ARE NOT AS ~EO BY THOSE Bl/ICK ROBES AS THEY HAve BEEN IN THE PAST AND THEY ARE KINO OF WANTING TO PUll ntOSE ROBES OFF AND lET'S SEE WHAT IS UN· DERNEATH THE RE .~

The Alabama Lawyer

The five Justices up for election, as you kflOlN, are Justices Torbert. Maddox, Beatty, Adams and Steagall, all Democrats and ... LL Honorable men wi th nothing under their black rObes but competence, character and Intcgrity. I personally hate to have to admi t that about one Democrat, much less five, but under the Canons of Judicial Ethks Ihese men are baSically defenseless because those canons of ethics prohibit tr-em, due to their positions, from engagir'6 you and/or your special interest groups In debate. If these " Damn JudgC5" are in cahoots with any lawyer or I~rs, plt'<lse present your evidence 10 the Justice Department, Ihe F.B.1. or better yet, the nL"NSpapers. Or maybe they're In cahoots with the judges and lawyers tool To be honest with you, Mr. Clark, your "cahoor statement Is not wha t bothers me, due to Its absurdity. What does scare me and I hope every cltixen of this State, Is your pian to stack our State Supreme Court with a majority of justices that awee with YOUR Ideology and Ihal of your spe(iallnterest groups. YOUR candidates, if elected, will probably have "appreciation dinners" at $1,000.00 a plate, and ;all of the lawyers and their clients and famlllC!S who hiM! a case pending before them If they were elected, would be Invlled to attend Ihe day before Ihelr cases are decided. Judges arc not legislators one lobbies for justice with the promise of voles andlor financial support in return for a precon· celved agenda hidden under the guise of "ph ilosophical perspe<llve" which any candidate )()u cOl,lld pay to run would ultimately hide under. At the State Coul1 level, Apr>cllate Judgcs and justices of our Supreme Court are rarely challenged and then only for a specific reason. In 1982 there were two I....... yers who challenged two of Ihe SUpreme Court justices that will, along with three others, be up for elCCtlon next year, they being Justices Adams and MaddoK. Both of the candl· diltcs running ag<linstthe Incumbents ran as Republicans. The one that ran against Justice Adams did so because Justice Adams Is black, need I say more. The other candidate ran against Justice Mad-

dOK for two primary reasons. The firs! being that he bellC\lCd strongly in a twoparty system in our stale but the most Imp(lrtanl reason was that the Supreme Court, which has exclusive jurisdiction of all of the law schools in our Slate, had recen tly ~Ied ADMINISTRATIVELY In Its capaci ty as such to close do.vn the nonABA-accredited law schools, one of which was the alma mater of thaI candidate, who made It his primary Issue. The admlnislrative (not Judicial) decision to shut down the nlght liIYI schools was 5-4, with Justice MaddOK I.Otlng with the majority. This candidate, or should I say the law school issue, receiYCd a;>proxlma teIy 40 pen::ent of the statewide vote. Since 1982 thcf(! has been on ly one other seat con tcs ted On the "'Iabam.l Supreme Court, by a highly respected rlItorn ey who ran against a recent a!)J)()lntce In a Democratic primary and who was nar· rowly defeated. Even In tnat election, competence w.:lS the Issue and not judicial agenda which you have Indicated will be your goal and thaI of your special interest groups In 1988. In dosIng, please forgive me for deviating a little In my promise not to add any hurrlor to this letter, but honestl y, Mr. Clark, Prlmc M lrrlster Botha of South Africa needs you and yOur W<lf of th nking more than the people or our State. Sincerely yours, Harry lyon Attorney Pelham, Alabama

Please send your editorials and leiters to:

The AI./uma Law~r P.O. Box 4156 Montgomery, Al 36101 Your opinions on subjects of interest to other Alabama I..'twyers are always welcomed.

32l

About Members, Among Firms ABOUT MEMBERS Barbara Fox Jonl!$ announces Ihe opening oi her office (or the general practice of 1i!W. Her office Is toc.1too at 7070 Weibel Oriw, Suite C·IOlD,

Belleview Plaza, Fairfield, Alabama 35064. Phone (20S) 786-9585.

•

Richard H. Taylor, formerly with Ihe firm of Brown, Hudgens, Richardson,

P." ., announces the opening of his 0(' fice for the !If,!ncral practice 01 liM'. The

mailing address 1$ SouthTrus\ Bank Bulldln& 61 SI. Joseph Street, Sfmnlh Floor, Suite 700, Mobile, AI;lOOma

36602. Phone (205) 433-3131 .

Roy

w. Scholl,

•

III, anoounces the

relocation of his office for Ihe practice of law to *2 Office Parle: Circle, Suite 200, Blrmlngh<lm, Alabama 35223. Phone (205) 871·6004 or 871·6011.

•

Janie Baker Clarke announces thc

relocation of her law offices to Ihe cor· ner of Scott and McDonough streets,

at 313 Sou,h McDonough Street, Montgomery, Alabama 36104. Phone (205) 264·2325.

•

George Hugh Jones, formerly associated with the firm 0( Parker and Da'NSOn of Blnnlngham, Alabama, an· nounces the relocation of his office to 103A Jessup Buitdlng. Highway 31 South, P.O. Box 1391, Alabaster, Alabamil 35007. Phone (20S) 6648131

•

Rick A. Williams <\nf'lOunces the removal of his office, effective August 1, 1987, from 300 South Hull Streelto 547 South Lawrer1(e Street, Montgomery, Alabama. Phone (205) 262-2719.

•

William G. Jones, III, announces the opening of his of(Ice at 2033 Airport Boulevard, P.o. Box 6096, Iv1Oblle, Alabama 36606. Phone (205) 4762015.

•

William G. Nolan announces he has relocated to Cenlral Bank of the South's Executive Financial Group, IOC4lted in the Financial Center on 10th Street and 5th Avenue North, Birmingham, Alabama 35203. Phone (205) 93).3034. Nol,ln previously served for t\vo years in the commercial lending department at the main office of Centro'll Bank.

Jonathan P. Gardberg announces the opening of his office at 3632 Diluphln Street, Building C, Mobile, Alabama 36608. Phone (205) 343-1111.

Miller A, Widemire, formerly regional admlnlSIl(Itor and deputy regional counsel for the United States Small Business Admini stro tion and

Richard S. Sheldon announces the opening of his office al 166 Government Street, Sulle 201, Mobile, Alabama 36602. Phone (205) 432-3737.

•

324

staff assistant to United States $enntor Jercmlah Denton, announces his return to lhe prlvatc pl<IClice of law with omces at Suite 2306, First National Bank Building. Mobile, Alabama 36602. Phone (205) 436-4100.

•

Douglas C Freeman announces the relocation of his office to 669 South lawrence Street, Montgomery, Alabama 36104. PhOM (205) 264-2000.

•

AMONG fiRMS Effecti'IC September 30, 1987, the law firm of Simpson, Hamilton & Ryan was dissolved. Fulton S. Hamil· ton and l . Thomas Ryan, Jr., are plea5ed to announce the continuation 01 their partnership for the general practice of liJW under the firm name of Hamilton &I Ryan with new offices located al 121 Jefferson Street North, I"untsville, Alabama 35801. phone (205) 533-7171 .

•

J. Scoll \bwell, Richard A. Meelheim and Gregory I. McKay annourn:e they hiM.! formed the Inw firm of \bwell, Meelheim & McKay, P,C. The firm's offices are located at Suite 500, 310 NOrth 21st Street, Birming. ham, Alabama 35203. Phone (205) 252·2500.

•

Gregory 8. Stein, formerly of Black· sher, M~nefee & Stein, has lolned in partnership with Henry Brewster, (or· merlyof legal Services Corporation of Alabama, aoo their offices ilre located at 405 van Antwerp Building. P.o. Dol< 1051, Iv1Oblle, Alabama 36633·1051. Phone (205) 433·2002.

•

The members of the firm of Miller, Hamilton, Snider &I Odom announce that Jerome E. Spet!Sle, Mile B. Greave5 and William 8. Garrl50n, Jr., ha'IC become members of the firm, and Catherine L. Mcintyre, Martin E. Roberts, Jr., and Michael R. Mills have become associ,lIed with the firm. M0bile offices are 2S4 State Street, Mobile, Alabama 3&601 Phone (205) 432-1414. Montgomery offices are Suite 802, One Commerce Street, Montgomery, Alabama 36104. Phone (205) B34-5550. Washington offices

NrNember 1987

are Suite 240, 1112 Sixteenth Street, N,W, Washington, D.c. 20036. Phone (202) 429·9223.

•

The law Orm of Williams & Talia· ferro announces that Robert C. Led· better ha~ joined the firm and the name or the firm has changed to Wil· tianH, Taliaferro and ltc:b!tter, Offices are located In the Bank of Ensley Building, 425 19th Street, Ensley, Birmingham, ... Iabama 35218. Phone (205) 76~3311.

•

The law o/'flces or Su~wart and Auoclales, P.C., announces thc relocalion of Its office to 2700 Highway 280 Sooth, Second Floo; Birmingham, Alaooma 35221 Phone (20S) 871-7800.

•

The l;w.t firm 01 Emond & Vines announces that Gary C. Smith, formerly with the Mobl'e County District AltorntY5 Office,. Stephen D. Scorey and 0. Bruce Petway ~ become associates of thc firm . Offices are located at 1900 Daniel Building. Birmingham, Ala· bama 35231 Phonc (205) 324·4000.

•

The I"""" firm of Minor" Manasco announces that Ronald W. Wise has become a partner, and the firm name has Changed to Mint)r, Manasco & Wi~ effectl~ i\ugust l~ 1987. Offices are located at 555 South Perry Street. Suite Ill, P.U Box 5022, Montgomery, Alabama 36103. Phone (205) 2632333.

•

R. Dalc W,lllace, Ir., William W. Brooke and David F. Byers, Jr., an· nounce the opening o( the law om~ of wallace, Brooke & Byers, 2000 Southbridge Parkway, Southbridge Building, Suite 525, Birmingham, Ala· bama 35209. Phone (205) 87Q.OSSS.

•

Haskell, Slaughter " Young an· nounces that Stephen L Poer, Thomas E. Reynolds, Thomas A. Ansley, K.

The .Alabama l.awrer

Stephen Jackson, Be...erl y P. Baker, William W. Horton, Thomas D. Samford, IV, and Charles A McCallum, III, have become associated wHh the firm (Birmingham office), Offices are locat· ed m 800 First National·Southern Na· tural Building. Birminsham, Alabamn 35203, III'1d 1250 Bell Building. 207 Montgomery $treet. ~tgomery, AI ... bama 36104. Phone (205) 251·1000 01' 265-8573.

•

The law firm of Smith & Taylor announces that James c. Gray, III, formerly associilted with Hardin & Hollis, has become assoclilted wiTh the firm. Offices are locilted ilt Suite 1212, Brown Mtlrl( TOWElr, Birmingham, Alabama )5203.

•

Dcwayne N. Morris and lames E. Vann announce they have formed a professioo,lI corporation lOt the prootlce of law under the firm name of Morris & Vann, P.c., with offices at 1707 Chy Federal Building.. Birmingham, Alabama )5203.

•

Howell, Johnston, langford & Wal· terS ilnnounce thilt Edward l. McRight, Jr., has become an associate of the firm, with offices at 61 St. Joseph Street, Suite 903, Mobi le, Alabama. Phone (205) 4)2·2677.

•

The law offices of Hopkins, vaughn & Al'Iderson, 2701 24th A-..enLte, GulfpoI'I, Mississippi 39501, announce that Kenneth R. Wollkifl§, formerly an assislilnt attorney general for the State of Mississippi, has become associated with the firm. Phone (601) 864·2200.

•

The l;w.t firms of Barry A. Friedman, P.c. and Reid & Perloff announce the merger of their firms under the name of Reid, Friedman 31 Perloff, 257 SL Anthony STreet. P.O. Box 2394, Mobile, Alabama 36652-2394. Phone (205) 432-2660 or 433-5412.

•

Armstrong & Vdughn announces that J. langford Floyd has become a partner in the firm and the firm name has been changed to Armstrong.. Vaughn & Floyd, cffedl\/(! June 1987. O(flces are located at The Summit, Spanish Fort, Alabama 36527. PhorlC (205) 626-2688.

•

A. L1mar Rcid, §tate agency drrector. and Mlsslsslppl Valley 'TItle Insurance Company announce that 'W!ra M. Kte ha5 been appointed associate state counsel and wilt supervise attorney agents throughout Alabama. Her ad· dress is 324 North 21st Street, BinnIng. h(lm, AI<looma 35203.

•

Wininger" lee, P.A, of Birmingham and Huntsville announ~ that D. Deleal Wininger, Ir" now Is assocIated wiTh the firm In the home office located in the 'Whilldin Building. 517 North 21s1 Street, Birmingham, Alabama 35203. Phone (205) 322-3663.

•

f\lter F. Burns announces that Peter S, Mackey na.v Is associated with 1he

firm, with offices at 50 51. Emanuel Street. P.O. Box 1563, .Mobile, Alabama. Phone (205) 432.0612 .

•

Copeland, Franco, Screws & Gill, P.A. of Montgomery announces that Charles E. \'en;elli, Jr" has Joined the firm as an associate. Offices are Icr cated at 444 SoUTh Perry Street, P.O. Box: 347, MontgOmery, Altlbama 36101· 0347. Phone (205) 834·1180

•

Wertheimer 31 Feld, P.C. and McCord & Hoffman announce that they ~ combined their pr.Ktices under the name of Wertheimer, McCord, Feld & Hoffman, p.c. OffIces are al 2109 Third Avenue North, Third Floor, Birmingham, Alabama 35203. Phone (205) 252·2100.

325

The Comprehensive General Liability Policy in Alabama-Coverage Provisions by Christopher L Mcllwi'in Com prehen51~ gener.ll liability pol.

icies provide c0Yer3ge to insureds for per-

son", Injuries and property damilge $uf· fered by third ptlrties. These policies, like others. som<!limes

have underStandably been d~rlbed as conlalnln8 "such a bewilderlng array of exclusIons, definitions and conditions Ihal thc result Is confounding almostlc

the point of being unintelligible:'! Another typical description Is found In

Bra/nard v. Aclna Cas. & Sur, Co., 17

Mlsc.2d 810, 812, 187 N,V's.2d 435, 4)7 (1959):

"The COUrt c,nnO( help bul comment \h;I1 the lansulge, both In extent and

ambiguity, in modem insurance pol!. cles II an abominallon.

Indu~lon, ~.

elusion, deIIn lions and coYel'ilge Jet forlh In the C01traC15 presenllhe most formidable type of obfuKillIon which

no trained 1)eMn, 1m alone a layman, can truthfully ~ Is IIrlythlnS but the cant 01 the I n~ure~. It I~, unfortunately, nOi wi thin the pra.<ince oItnis court to order that poUcles be written brleny and lucldly.' The basic Hl nsuring agreement" under a comprchenshe general1iabilily policy provld~ as (ollows: ~I

COVERAGE A-BODILY INIURY

LIABILITY COVERACE B-PROPERTY OAM· AGE LIABILITY The CompM"I' "1111 pay on behalf of the

InJured all mIlS which the Insur(:d shall become legally obligated to pay as dllmage! because! 01 A. bodily Infury or B. Pf'OPCrly d.1masc to which this Insurance applies, aused by an occurrence: No coverage exiSts under the policy unless this prCl.ilslon is triggered . In determining whether a particular person, corporation or o the r legal entity

Is "covered" under a com prehen51~ general liability pelley, It is helpful to analyze tne policy by asking the (ollowIng questions: (1) I~ the peoon an Hin· sured" as defined in Ihe poliCYl (2) Is the injured th ird party claiming ''bodily in· Jury" Or Hp~rty damage" and did th is InJul)' or damage occur during the policy perlodl (3) Was the InJul)' o r damage caused by an "acciden t'" (4) W,l$ IhelnJu ry or damage expected or Intended by the person claiming CO'verage? (5) Are any exclusions under the poUcy applicablel This article discusSC5 Alabama decisions cOnstruing the policy provisions relating to questions I through 4.

Is the person an "insured"l

The term "insured Husuall y Is defined In Ihe "Defil'lilions" portion of the policy as 'o ll~: "'Insured' means any person or organlutlol'l quallfylng.s an Insured In the 'Persons Insured' provlllOl' of the al>pllcable Insuram;e CQYCr.lgc. The In. surance afforded a~plles $Cparately to each Insured 118<1ln5t whom claim Is made 01' suit is brough~ except with respect 10 the limits of Ihe Com.,.ny'i liability••• :' The "Perwns In~ured" provision slates: "11 PERSONS INSURED Each of the following Is an Insured under this insurance 10 the extent set fOllh Ix:low; (a) If the Nam(:d Inlured Is do~lgr'alt'd In the declurJ\lons as 3n Indlvldu· ai, the pef500 S(l ~Ignated but only with respect to the conduct 01 a business d which he Is the sole P!O' prletor, and the spouse 01 the Named InsuA!d "11th respec1to the conduct 01 such a business; (b) If the N~med Insured 15 designated In the declarations as a PiI"nershll) or Joint W!nture, Ihe partnership or Joint ~nture sodMiglliltt!d and any partner (lr meni)er theroof but on-

Iy with mspect

h s UllbllJry liS

JUch;

(c) II the Named Insured Is designated in thededarallons as OIher than lin Individual, panoeBhlp or Iolnt venturt, the ~Ililtloo so designated and i""y t'J/e(udll'tl ofik.Cf, dlreaor or stockholder Ihcredwhlle ,ctlns within 1M scope 01 his dulles as svch; (d) any person (other thM M empl~ of the Named Insured! or organlza. tlon while acting as re~1 est1l!e man_ ager for the Named Insured; and (e) "11th respect to the oper;I!lon, /of!he purpose 01 locomotion upon a pui). lie hlShwolY, ol mobile equipment reslstered u~r any motor ythlcle registration law, (i) an emplC¥!'! 01 the Named In_ sured while operating any such equipment In the course 01 his employment, and (II) any other periOn while operating with the permission 01 the Named Insured any such equipment regiStered In the name 01 the Named l!l~urcd ~nd any pt'!1'500 or Of8lInilatlon legi;llIy ftspQnslble for such operation, but only If there Is no other valid and collectible in",ranee available, either on a primary or ex<:MS I»sls, to such person or organization; pra.<ided that no petSOn or organlu· tlon shall be an Insured under this paragraph (e} with respe(\ to: (1) bodily injury to any fellow emplO'r" ~ of such person Inlured In the course of his employment. or (2) property damage 10 property owned by, rented 10, In char'!JC of or occupied by the Named Insured or ttoe emp'~r 01 any person described In wbptlragraph UlJ. This imuraoce does no! a~y to bodily Injury or property damage arising out oi the condUCt oi any p.1rIMrship 01' faint YefllUre ol which the Insured is a panner or member and which Is nOi designated In th is policy as a Named Insured."

November 1987

The bulk of the litigation relating to the term "I nsured" has centered on the inclusion of "execlAive officer" and whether particular employees of the Insured constllule executi...e officers. The tcst appears to be wht!ther the Individual in qu~tion possesses managerial or policyoriented responsibilities and is closely connected with tne board of directors or 8~rnln8 body of the Insured employer. Applying this test, the following employees have been held not to be "executive officers" of private corporations: the assistant managcr of a nightclub? a foreman) and an assistant project manager.· A SC'oYer foreman has ococn held to be an "executive offlcer."J The term "exccutl...e officer" has boon held to be ambl8uouSwhen applied to a municIpal corporation as oppose(! to a private corporatlon.- The Alabam<l COurts have held that a ci ty traffic engineer was an "executive offlcer,'1 and that a school building supervisor was an "executive offi cer:' but that a police officer was nol.' App..1rently as a result of holdings allOWing c~ra8e 10 non-employer In. sureds In co-employee actions.' the deflnition of "Insured" has been changed in some policies so thai In connection with certain types 01 oclivitles "no person or organization" is an Insured with respect to "bodily Injury 10 any fellow cmpl~ of such Injured In the course of his employmcnt:' Hence, under thIs so-calh.>d "(etlow-employcc exclusion;' neither the employer nor the executive oWcer has coverage for co-empl~ suits based on Inj uries arisIng out of certai n aCllvitles.'o Did bodily injury or property damage occur during the policy period? The term "bodily Injury" normally Is defined In the "Definitions" portion of the policy as follows: '''bodily Injury' means bodily In jury, sickness or dlseue sustaIned by illl'( person which OCCUB durlnsthe policy period, Including deaTh aT any time result/ng therefrom ..••~

The Alabama Lawyer

The term ~property dam"8e~ usu<llIy Is defined as: ~(a) physlcallnjury to or destl\lClIon ol tangible propertywhich OCCUB during rhe poIiC)' period, Includln8 1he loss 01 use the"OOl al any time resulting therefron, orlb) loss d u§e d lilnglble property whi<:h has not beM 1Ji¥1c;.ally I~Jured or ~tlO',«l plOo'ided such loss 0( U5e Is C<1uSoed by an occurff!nceduring the policy ~rlod.~

The term "bodily (njulY" has ~ held to include menial anguish even Ihough there was no evidence of personal Iniury.11 The term "property damage" h<ls boon delcrmined to include damage to a building cauSt.>O by defective groutP but nOI to loss of insumnce benents by <In employee caused by an employer's failure to procure an Insurance policy.') It is unclear whelher property damage Ihrough loss of use occurs when the Insured obtains lille to property (rom the complainant by way of f",ud. In Safeco Ins. Co. v. Sessions Co., Inc., 435 5o.2d 5 (Ala. 1984), the Issue was posed but not (lC(ided. A claim for labor and materials in conneclion with repairs necessltaloo by a defect in the insu-ed's product does not constllule a claim for loss of usc.'The requlremenl Ihal the injury or damage occur "during the policy period" has caused the Alabama courts consIderable problems In CtI!e5 where the in. sured's wrongful act occurs outside Ihe policy period.

In Ulica Mut. Ins. Co. v. Tuscaloosa MOfOl Co., Inc., 295 Ala. 309, 329 5o.2d.

82 (1976), a car dealer mHie repairs to a motor vehicle during the poUcy period which resulted in the car and liS driver being Injured and damaged after the pol. icy eMplred. The supreme court held that the policy did not provide coverage for bodily injury or property damage outside the policy period tM!n if the wrongful ao or omission took place during the policy period. Justices Jones, Shof'l?S and Blood\.',Onh, and Chief Justice HeOln dissented, contending that "public policy" requlrod ,m Insurance contract to fix cO\lCrage concurrent with the time of the Insured's culpable conduct. The holding In Utica MulUal was followed In R. A. Owens Constr, Co., Inc., v. Emp. Ins. Co. of Ala., 392 So.2d 1180 (Ala. 1981 ), where the damage did not occur during the policy period and CO\lCrage wtlS denied. HO\o'XlVer, in Wixom BrO!. Co. v. Truc:k Ins. Exchansc, 4J5 So.2d 1231 {Ala. 1983}. the court re-examined Ullca Mutual and decided that the dissent's "public policy" argument had become

more compelling and required Ihal Ihe Insurer cover a claim for personal injuries and property damage occurring Three yeal1 and seven months after the policy was cancelled, where the Insured's wrongful conduct had occurred during the policy period. Chief Justice Torbert and Justices Maddox, Faulkner and Adams dIssented.

Christopher Lyle Mcilwa in Is a graduate of the University of Alabama School of Law and a parmer in the Tuscaloosa firm of Hubbard, Waldrop, Reynolds, Davis & Mcilwain. He is a member of the Alabama Defense lawyers Association and the Defense ResearCh InniMe.

327

The court " nip-flopped" again In

U.S.F.&G. Co. v. Warwick Dev. Co., Inc., 446 $0.2d 1021 (Ala. 1984), and \Ner(uled Wixom, returning to Ihe view expressed by the majority In UriCIJ MuIUM. The decision In IV/rom was subsequently reversed In Truck Ins. Exc/l<lnH~ v. Wixom Brolhers Co.; 460 So.2d 864 (Ala . 1984). Thu s, under the "occurrence" type policy presently under consideration, the date of damage determines coverage. By Wiry of ConlJ'3st, under the "c1ilims mode" policy, the dale of the claim will determine covcfdge.1l On occasior'l, the time when dilmage or Injury occurs not always is clear. Thi s is especially true In cases of continuous injury. In order to limillhelr exposure In· surers have argued that for purposes of in ~ur,mce coverage the dilte when injury or damage occurs should be a certain date, such as the manifestation of the inJury or the date wher'l first or l(lst exposure to injurious condition s takes place, These efforls hIM! mel with lillie success. In Mul. Fire, Marine and Inland Ins. Co. II; 5afcco Ins. Co., 473 Sc.2d 1012 (Ala. 1985), Ihe court, reaffirmin g Utica Mutual, held th at a scintilla of evidence existed on the question of whether dam· age to a house from termi tes occurred during Ihe policy period, because the complaint againSt the insured alleged Ihat damage did so occur." In Comm. Union AsSUf. Co. v. Zurich Am. Ins. Co., 471 F.Supp. 1011 (S.D. Ala. 1979), the court held thaI bodily injury from silicosi s did not merely occur on the date of the employee's last exposure to thl:! Condition t ilusing his injury. In Commer· clal Union Ins. Co. v. Sepco Corp" 765 F.2d 1543 (1111'1 Cir. 1985), the court held that bodily Injury, as a result of asbestosrelated Illnesses, occurs upon (l)(posure of the victim to asbestos hal!ilrds, ralher than on manifestation of the subsequen t illness.

Was Ihe injury or damage caused by a n accidenH The " in ~urlng agreement" requires thaI bodily injury or property damage lx! c.. u~ by l1l'i "occurrenCe:'

328

The st'lI'Idard of c;au$alion required is fairly high. 11'1 U.S.F. &. C. Co. v. Warwick Dcv, Co., Inc., 446 $o.2d 1021 (Ala. 1984), the court held that a claiM of misrepresentation of the existence of defects in a house was not covered because th e "property damage'.:....th e illieged defectswert;: not cClused by the "occurrence'!... the alleged misrepresentations. The term "occurrerc::e" usually lined DS follows:

de-

" 'Occ::urrcoce' mea1S an aCCident, Including continuous or r~lIlcd e~po. sure to cOrldlllons, which resulls In bodily Injury or property damalle ncirher expt>c:tro (!Of inll.Yldtod from rhe slartdpoint of the insured." There is some conflict 01'1 whether fraud constitutes .:In acci dent. In U.S.F.&G. Co. v. WlIrNick Dt!v. Co., Inc. 446 So.2d 1021 (Ala. 1984), the .court hl:!ld th.,.1 a misrepresentiltion madt;: by the Insured does not constitute an "oc· currence:' H~r, in COlron Srares MuWal Ins. Co. v. Norrell Heming & Air Cond, Co., Inc" 370 So.2d 270 (AI". 1979), the court held that a d ilim of intentional, reckless or innocent misrepresentation constitutes O(currence, lind thi s holding wa s reaffirmed in U.S.F.&G.

Co. v. Andalusia Ready Mix, Inc., 436 $0.2d 868 (Alil. 1983). See also, Fowler Am Con/rei and Insu/atlon, Inc. v. Hart· ford In s. Co. o( Ala. , 21 ABR 4022 (Ala. 1987) (holdIng Ihat a claim of unlnten· !ional fraud Is covcr1!d). Breach of a warranty does con stitvt~ an acclder\!, al (caS! in th ose policies containing products hal!(lrd covefdge.I ' Negligence Is usually held to con $titute an accident ." H()Y.IC\.'Cr, In U.S.F.&C.· Co. v, Boitz Ins, Co, of Ala .. 424 So.2d 569 (Ala. 1982), the court held that becavse the insured roofer, prior to the Inception of the policy, knew that a roof it had construCted had leaked for over four years despite repair allemptS, "nd there was a real possibility that the rOOf would contlnuclo leak, th e damage wa s not " unforeseen. une>lpccted or unu s ual ~ and therefore was not an "accident."

Thu s, the court held there was no coverage even though IhelnsurOO was charged only with negligence. A treSpass is not (In "accident" even where the resulting damage is unintenti onal, as long as the acts conslituting the trespass are volur\lary and intCr'lllonal and the Injury Is the natural result of the act.19 (t is unclear whether wantonness cor\stilutes iln "acciden t:' In Armstrong v. Security Ins. Croup, 292 Ala. 27, 288 So. 2d 134 (1973), the COUft quo ted With approval th e foUO'Nlng language from a Fifth Circuit opinion: 'Where acts are \Olunr~fY and Inten. tlonal and lho Injury is rhi!na!Ulal result of the act, the result W"d~ not caused by accident even thouSh tllar ~sl,llt may hiM! been unexpected, un~n :lfld unintended . . . ;.

Id., 288 SO.2d at 136

Was the injury or damage expected or intended by Ihe person claiming coverage? Since the 1984 case of Ala. Farm Bur. Mul. Cas. Ins. Co., Inc., v. Dyer, 454 Sc.2d 921 (Ala. 1984) (Imerpreting CI homeowner's policy), a " purely subjective" standard has gqverned th e determination of whether injufY or d(lmllge is expected or intended from th~ standpoint of the insuft.'d. Under Ihe subjec· tI~ test, an injury is " intended from the standpoint of the Insured" if Ihe Insured possessed the specific Intent to cau se bodily Injury to anoth er, wherea s an In· jury 15 "expected from the standpoint of the insured" if the insured subjectively possessed a high degree d cert ainty that bodily injury to another would result from his or her aCt IO Prior to 1984, It not always was clear wh ether an objective or svbjectlve les t wa s being applied In determining whether Injury or damage wa s expected or Intended, On some occasions the coun would apply one or the other or even both of the tests In the s..1me case. O n other QCc..sions Ihe court applied neither test and apPeall,.'(j to base its deci·

November 1987

sian solely on the theory of liability asserted against the insured In the com· plaint. In ArmSlrong v. S&urlty Ins. Croup, 292 Ala. 27, 288 So.2d 134 {I973}, Ihe court held Ihill where the owncr of a sandwich shOI) broke up a flghl using a gun, r(!suiting In the severe Injury of a patron 1f"M)lvcd in the nght, the trial coort was justified In concluding thaI the in· jury was ~peclcd or intended. The court rejected as unpersuaslve lhe insured's claim that he did not aCtually Int~d to injure the plaintiff. In Ladner 8. Co.. Inc., v. Southern Guaramy Ins. Co., 347 So.2d 100 (Ala. 1977), the claim agai nst the insured was Ihat the Insur(!(! "knoYJingly" had built homes In a flood·prone area and then sold them 10 the complainants. Because ollhe use of the "ort! '1mowingly" In the complalm, and the fact Ihat nothing in the record Indicated that the com· plainams were asserting any theory of liability other than Intenllonal aCIS, the COUrt held that there was no coo.<:rage. AI· though there was evidence thaI the In· sured did have (ull knoYJledgc that the houses were In a flood·prone <lrea, the court did not ludlC!I1(! lhal this was dispositive. In /,aw/er Ma ch. & Foundry Co., Inc., v. Pacific Indem , Ins. Co., 383 So.2d 156 (Ala. 19801, an intoxlcaled employee of the insured droYe the Insured's pickup truck Into a cltM'ded restaurant, after hay. Ing an argument wilh the cashier and leavlnglhe resl<lurant "mad," There W.lS some evidence that the employee simply lost control of the Huck due 10 his In· tOlClcation . Holding thaI the employee W<lS not covered, Ihe courl appeared (0 say that both the subjecli\l\! and objec· tlve teslS were to be applied: 'Was the Insured's condua !O con· sclously and voluntarily cotnrTlittt!d as to rendel lhe ~iultanl InlUlles and damages the n;ltlr.ll and p!Qbable coosequenas 01 slJCh cooduar Or, stated anOlher w.tI. did the Insured, with reir sonable foreseeability of Inlury, so coo· scloosly dll1!Cl his actions that the resultant Inludet am the natural or probllbly COf!seqJcoces thereof?"

Id, 383 So.2d at 158 In I.JJke500re Dt;V#! Recrealion Club, Inc., v. U.S,F, & G. Co., So.2d 278 (Ala ,

1981), the Insured periormoo highway conStruction work Ihill caused siltillion of a small lake. These problems wt!re noticed In 1974, bUllhe proJ(!(1cngint..'Cr decided to wail until Ihe project WJS compleled to lake any action. When the project waS completed In 1976, Ihe In· sured Initiated efforts to clean oot the sill. These efforts were Intentionally lermlna· ted in 1977 because the Insured bell("..<C(:J 11 had already remOYed more silt than It put In the lake. The court held that there was a scIntilla of evidence Ih<ll the cessalion of restoration efforts did nOI cause property damage Ihat was lnlendoo or expected. "In olher 'Mlrds, a trier of faci could conclude thaI 5oI.llheast ended 115 restoration work bec.use It believed II had already remoYed more sill than il had put in ... :' Id. at 283

If your real estate project has unusual twists, that's a sign you need Commonwealth James K. Morrlhow. Jr. State Representatlye t6o1 St. FrancIs St .. MobiIO. AI.. 36602 (2051 433·2534

The Alabama l.awyer

In McDonald v. Rayal Oobe Ins. Co., 413 So.2d 1046 (Ala. 1982). the manager and assistant m<lnOiger of Ihe insured nightclub became Involved In a fracas with some patrons who had been asked to leave. The patrons flied suit for assault and ballcry. The Jury held that the InJuries were neUher ClCJ>CCted nor intend· ed from the standpoint of the nightclub, but Ihe trial court granted a summary Judgment In favor of the Insurer and against the manager and assistant man· ager 0.1 this luue, The supreme court held thOiI the grow of sumfTlilry judgment was error l;J.e(ause intenl is not a necessary eh~menl of assault and i).l11Cry, and because the Issue of whelher the ilssault and battery In the case at bar was inten· tional was a question of fact. In U.s.F. 8. G. Co. v. 80nilz Ins. Co. of Ala., 424 So.2d 569 (Ala. 1962), the In. sured entered InlO a contract for in. sulating and conslructing a roof on a

COMMONWEALTH lAND TITL£ INSURANCE COMPANY " ~. Goooop ~

ear-

J29

gymnasium. In late 1972, after complelion of Ihe projecl, Ihe roof began 10 leilk. Repairs were attempted on several ()CCilsion$, but the leaks continued until 1978 when the roof W,'IS completely mpii'lced. Suit Wi'lS filoo alleging breach of contract and negligence. From 1972 through 1977, the Insured had Insurance through U.S.F. & G" and (rom 1977 through the time of Hiill, insurance was provided through Eml)ioyer's Mutual. In determining thilt the dilmilge Wil 5 not intended or eXJ)e(;ted under the U.S.F. & C. policy, the supreme COurt lelied solely on the fa ct that the Irlsurcd was umerel y charged with negligence In Inslailing the roof." No obJe<:Uve or subjective lest was applied . In Mon v. Champion Ins. Co., 44 2 So.2d 26 (Alii, 1983), the Interior of iI house WilS dilmaged by rilin when the loof allegedly was left unC~led during a re-roonng job by The Insured roofer. Reversing an ore /(!nus verdict in favor of the Insurer, the supreme court cmplO')«! a subject/Ye test to the evidence before it and concluded that the damage was neither expected nor Intended. The coun found especially persuasiYe evidence th .. t The i n ~ur¢<J hild taken rea$onable steps to prevent damage in The form of instructions to v.vrkers not to le~ the roof un c~red . As In Bonlll , the court also notoo that the Insured roofer was charged with negligence alld Unot con· sclous acts made with Intent to cause damage." In U.5. F. & C. Co. v. ArmSlfon& 479 Sc.ld 1164 (Ala. 19851, a deci sion re no d(!red after Oyer; Ihe complainan t's land w..s damagL>d when raw sewage flowed on It during replacement of a sanitary ~r system. The existing ~r line had been Intenllonall y crushed by the Insured contr<lctordurlng the construction to allow work on the new line to proceed below the existing line, and this crushing blocked off the sewage, causing it 10 back up in the line and flow onto the com· plainant's prOperty. The ~ uprl;!me COurt held Ihat there was a duty to defend because the complaint against the In· sweds alleged only negllgellce. In order

330

to determine whether there was a duty to pay, hCM'C\lCr, the court went further than merely e)(amlnlng the complaint and expressly applied the subjoctive lest to the facts. Finding tha t there was no eviden( e 1(1 suggeSt thaI the insureds speclncally intended the discharge of raw sewage on the complainan t's land, the court held that U.S.F. & G. had a duty to

''Y.

The supreme COUlt has construed the term "Insured" quite narrowly when determining whether in juries or dllmllge$ ilre i01ended or expet:Ted " from Ihe standpoint of the Insured:' Even if inluries or dam:..ges are intended or expcctfod by an employee of a corporati on or sole proprietorship, this Intent or e)(pectation Is not Imputed to the corporation or proprietor 50 as to preclude ca.'Crage to the corporalion or proprielorP Where there Is more than one insured under a single poliey, the intent or cxJ)e(;tation of one insured will nOI be imputed to Ihe other, absent some evidence that the other dlrE!(tc(! or participaTed in the wrong."

Conclusio n While the comprehensive general lia. blllty 1)Olley, at first glance, may present the "bewildering (l frilY of exclusiOn$, def· Initions and conditiQns," the Alabdma courts have provided to the practitioner dli»inltlve guidelines In the construction of the IXllicy provisions.

•

~ OO'!NOHS

' MoI'HII v. MldlandN.,'I In,. C"" 41 111. AjIp,ld 1" l8, 190 N.E.2d 591. 602 (195]1. • McDon.ld v. Roy.1 CIobe In>. Co" 411 SD.2d

101~ (Alo.

198 Z). , Wo/~ •. At'MO en & Sun'ly co. l ~ G So.ld 952 IAla. "m: U.S. , . , C, Co • • W"hll'l~ 3J6 f .s..pp. 1190 tN.D. AI • . 19111.

• Million 1",. Co. Y, B. ,nert 476 ' s..PP. ~ l5 IS.1) AI • . 1919W(1!1nl unPubi lollo:d d«1.I()rI~ 'Unllr<i Sl.te::! f!",I". . Co, Y. McCom>i<:l<. 1Il6 AI., 5) 1, 24 J SO.2d 361 119Ya. • NonM.nd In>. Y. Chy 01 Moor,.,....,.,.• • 18 So,2d U I (AI• • 19821. , NOilillillI(/ Inl. Y, C ~y 01 MOnIf</"Il''Y, .1 8 So.2d U I 1A1• . 1982), • Piolltn v. ( 111(1"""/111,. co., Ill(" 400 $O,2d 393 1A1• • 19811. • 1-1""", In~. eo. Y. R~ {W'P. CO .. 111(., 3eI SO.ld H 1A1•. 1!NIOl; UnJredSr.I.. file 1111. Co. y, McCOImk l<. lR~ AI., U l , 143 5o,2d J 6 7 1 1 9roKf~UlI ... offire

"""""

" Southt!rn CvOl' "Iy '"1. Co. Y. 1'11("",", 43' 5o.1d 7 (Ala. 19II1HpeI>M who wI, ykooo_OIoon. Inc! ow",,, of ont-lhlrd of IIIICk, who . 1100 Wit '" "~." wn not

covered In..,r., II r..l low",,"~ d .lm1. hl _, ,1.11.. jiotJ '", . CO. Y. SO/nerl . , 6 F.s.w. 925 tS.O. """. 1919H~'\I'C"'I ", offiw not ~n ..... P'CI'ti't urwJe, ItllowImp1<'1'(ft exch"ionl dl .. pprove<I ln II""", l/ldem. Co. •. 1Ieft1 (QUip . Co" 381 5o.2d 45 1A1•. 19801. " Mflll/JOn "'"U •• Co. Y. NOIIh Am Re/nJuwlC1! COIp., sae F.s..W. IH. ,N 0 , AI. , 1'1a. 1 ,ttd. 760 F,2d 279 111m CI,. 1~ 5). " U.H . ~ C. Co. y . ,\rwJ.,I",I. R...d)o ,1.111(, III(.. . J 6 :;0.211 8611 1AII. 1931). " D./oItl lumbe, Co. ~. lumbo,,,,,,., Mul. 1m. Co., ~ 1 ) SD,ld 973lAla. 1985). " LI.s.F. & G. Co. Y. Mdi! 1~ RHdi Mjl(, I~., 4J6 SII.2d 8611 (,0\1 •. 19811. .. $N,ho, AMOC. J7 A.t. R. • !h 38'I196S). TI\e "clll..... m.oda" !~~ hoI been hO'Id to be In oco;1;lld with AI.bo .... PubliC [lOney. I."",. Y . H~k"'Vl!h Y, COlllI",,"'" Ga •• Co •• 52) ~ . s..W. 1U IN.D. AI. , I ~ ao). " Accord,

l,Iodntt of, CO.. 111(;" y

Co., 341SD,2d d~"nB

SOotl!f,~

Cu".nw '"/,

lOOtAli. 19'~l.o lnu l ~dotna!Io

rile policy

pe!~I •

" fllMI. lq<Jlp. Co." ~n. Cer>{l'~ IIIJ. Co. . 493 So.ld IJ37 19851; U.s.F & G. Co. Y.AndIII".I. /IN<Iy MIl(, 11K., 436 So.l d af.ll W • . 1" "1 Co!lI)r1 S"~ Mu!IH/ I"~ Co. " No/ ...1I 11...!I"II & All Cond, Co., 11K, 1m $G.l d

1"''-.

l 70 IAII 19791.

GE NERAL CO U N SEL The Alabama Stat"! Bilr now Is ac· cepting aplllici'ltions by leller wilh rtsulnc from Quali~oo 1,')W~rs for the position of GenerJI Counsel. These should be addressed to Chairman, Selcetion Commillee, P,O, Box 671, Montgomery, Alabama 36101. This position requires an experienced lawyer wilh a wong professional background. 5.1lary commensurate with ~perien ce ,,md mllturity. The Aillbama St ..te Bar is an C(lual oppertuni1y employer.

"MQ1.I " c~iolj1IQn In~ c o.. 442 So.2d 26 tAli. I'll!; UH , Co Co. " 81,mlnjlum I':b!yp SM., 11K., 290 All, 149. 27' So.2d 615 n97jK.u I>p1y oIIMOI ""'! producl): f'~~

Co.,

In, Co. 01 oil.

, 111('., ,, .... .

ROOIlnf' Sldm,

Inc., 211 AI., ] 94, 124 So.2d 2~ 1 (I%OXmoIl ...1u}; (mp. IIIJ. Co. 010114. " ~ I,,", 264 All . 31Q 87 So.2d 6Sl

MSSK"l hl, cOIm M\ w.n Indlntd 10 'I ..... Ilber. 1con· 04rudlon.o 1~ ""I>nl ·Keldenl: "I.

.. 1/10",.>0<1 Y. U.H . '" C, Co., 2. 8 f.ld'l 7 15!h e lr. 19571.

.. ,\/. FI'm B,," My!. en I", Cc., In(. Y. Oyer. 45. So.Jd 92 1 1A1• . 1984). " 11 ...1#1 Ml(h & f<llllli$tot c o., In(. Y, P/I(.irrc Irnkm. In•. Co.. l8] So.2d 156 tAli. !980,jcorporllion): Mou Y. C~",pSOr! In,. CO" " 2 5o. 2d 26 1A1•• 19II1)(tola J>lQl>lklollhlp).

.. '\'m,tIOl>8 s.cv" I~ Ill!. Croup, 292 All, 27, 2118 So.ld 114 11 91)11.... ul! by ""'" In"" ed not C' I*' o:ol Q< Intend«! by OIl'"

I",u~.

November 1987

• When you write wills, trusts, and CState plnns, }Q1I want your sources to be as organized and as comprehensive as possible. Thal's why AmSoulh's all new second edition Will find Trust Form Book is bound in scp:.mHc volumes of wills and trusts. [t includes twenty-n ine complete documents tailored to AJ nbn ma low - far more than :lny other Abbnma form book g1 ves you. We :lIse provide you with pai.lllel COIlUllCntaryon each document, pttrticuInriy helpful in CSlnlC planning. Best of nil, it's updated regularly to ensure continu ing accumcy. For more information or to order, call the ~ AmSouth Estate and1l'usl Planning Rcprcscntn- Jj tlVC in your area , and talk to someone who Fe Growing cds speaks your iangllnge. Ne.

rru

AnniSlon 2J5.9J<LO HUrl\~ville

I L\ffll

The

~Iabama

Lawyer

~"h

n.."k, NA.

nlrm;nllh~m Jl6-~ Dtta,UT 552·93 19 [)olltJ1ll 793-:nxJ 5JS-M.17 Mobile 438·1!Ofi9 MomKOl1lcry 8.I~·Y5U1

Memlxr rOle.

)),

Review of TRA '86 Changes in Corporate and Personal Taxes by Joseph W. Blackburn

Introduction Some of the biggest news In 1986 for altomeys and their clien ts were 11'1.:> sweeping corporale and Individual tax changes brought about by Ihe Tax Reform Act of 1986 (TRA '66), The reforms 'NCre

so fundamenlal th,lt the Intemal Revenue Code of 1954 v.IlS redesignated the internal Re...enue Code of 1986. The purpose of Ihls article Is to highlight SOme of Ihe more important changes. Gerlcral practitioners mu.1 keep these nCYI rules in mind while advlslngthelrcllcrusewn on such basic mailers as Incorporation of a business, sale Qf real est.lIe with installment notes and deduction of business meals.

Impl ications of corporate and individual rate changes As most arc aware, thc big benefil to all taxpayers under TRA '86 was an across-the-board reduction In applicable tax rates. Corporate tax rates 'NCre dropped from a high of 46 percent in 198&. to 40 percent In 1987, Such rolles arc scheduled to drup to a maximum o( 34 percent in 1988. Likewise, individual rates have made a similar dramatic fall from SO l)Creen! In 1986 to 38.5 percent In 1987, and ultimately, to a maximum of 28 pereent In 1988. H~r, the effective tax rate for high Income individuals may ~ 28 percerll. For~颅 ample, married taxpayers filing Jolnlly with Income in excess of $71,900 will have an effective tax rate of 33 percent. This 5 percent surcharge will terminate and the effective rate will dro p back 10 26 pt:rcent when the taxpayer's Income reaches E!\'I'!n hi~r levels. This level will likely be between $150,000 and $200,000 for most taxpayers. Subject to Congress's possible postponement of the scheduled 1988 rate reduction, these reductions haw major implications on basic planning, Individuals now will be paying taxes at rales 10000r th.1n corporations. Therefore, for this and Olher reasons, many buslm_'Sscs may look very carefully al alternatives to Ihe cor332

porate form of bl,l5iness organiza tion. Proprietorships, general pannerships,

limited pannenhips and Subchapter S corporiulons alf'(!ad~' haw become In-

creasingly popular. The IClYIerlng rales also sussest other basic planning techniques, which will resuh In deferral of income (rom the higher rates appllC<lble in 1987 to Ihe lower tax

tion, However, transition rules Slill allOYl closely held corporations with a value less th<ln $5,000.000 to elect Subchapter S before January 1, 1989, and avoid the double tax. Such a corporation also can ayold double lax on a liquid<ltlon prior to January 1, 1989. TRA '86 also limited the amount of net operating loss car'1'Y'"forw.ud which coold be utilized annually by a corporation folIONlng a change of ().'Inershlp In Ihat COrporalion. If, OYer a Ihrce-yellr period, a shareholder int reases his stock O'Wner路 ship by 50 pert entage points, Ihereafter the corpor.ltion's ability to utilize loss carry-fOrwMds will be IImiled.

rales iMlilable in 1968. This is sound and basic planning for corporations and In-

dividuals. T'NO available tcchnlques are nonquallfled deferrtod compensation (to

diller salary) and Installment sales pla" s (to defer gain on accounts rccelV<lblc),

Impact of TRA '8fi on sale and liquidation of corporatio ns Several different provisions o( TRA '86 will have a substantial imp.lct on tax pay"ble upon the sale andlor liquid"tion of a corlXlration. Changes include repe<ll of the general utililies doctrine, limits on net operating I~s carry-forward and new allocation rulM for assct acquisitions. Prior to TAA '66, a corporation's stock or assets could be sold with only orle long-term capital gain tax to the seller, .)Od a stepped-up basis in the operating assets to the bu~r. Under TRA '86, a corpor.llion which sells its assets and liquidates the sales prot:eeds to the shareholders nOYl will pay two taxes. The first tax is on the corporation's sale of its assets. The SKOnd tax is on thc sh.. mholder's rocelpt of tile proceeds In exchange for his stock, If a stockholder sells stock Instead of the corporation's assels, thc seller will have only one gain on sale of stock, However, the buyer cannot get a steppcd-op basis in the corporation's assets without incurring a second tax _1ml)Osition of this addi tional 5CCond tax nOYl must be conslder...>d very carefully by buyers and sellers alike. The second tax can be avoided by Subchaptcr S corpora!ions If timely Subchapter S elections already have been, or can be, made. Congress changed the Subchapter S rules to Ctluse the second tax on sale of a corporation to be im路 posed even on a Subchapter S corpora-

Asset basis allocation Prior to TRA '86, buyt!", and 5Clle~ in " business assel acquisition could allocate the purchase price anlong the various assets by "arms-Icngtll" negotiation. Under TRA '86, both the buyer and the seller must use a milndaled allocation procedure. In representing a business clierlt, all 01 these factort must be we,ghed, To provide basic planning for corporate clients, consider the possibility of liquidation or election of Subchapter S status before January 1, 1969, Given Ihedouble lax on repeal of the general utilities doctrine, the prescribed method (or basis allocation and repeal 01 the deduction for longterm capital gain, many futu re sales of buslnesSt.>s will be restrvctured to pra.olde for stock sales coupled with large non-competc arrangements or restruc路 tured altogether as leases. Rules having an impact on lime of recognition for incomc and deduction Important s'Neeping changes In tax accounting rules also werc mllde in TRA '86. Changes include Impol1anl new rules which may ilcceler"te Income under Installment ootes and InSlaliment receivables. repeal the reserve method for deducting bad debt expenses and require changes from fiscal ~oeil rs to calendar years, When Congress relieved individual taxpayers of over $120 billion dollars In taxes by rate reductions, $120 billion dollars of additional revenues had to be made up from corporations. Almost 2S percent of Ihis ilddi(ional revenue is to be raised from the new accounting rules. Those flgures should give a clear Now:!mber 1987

Idea of the Importance of the new ac· counting rules 10 allomeys and Ibeir clients. One chonge thai will have an imlNct on transactions almost all lawyers routlnuly handle are the new rulus alJpli. cable to the installment method of reporting. Installment reporting is Impor. tant In two types of transactions. First, and most commonly seen by most lawyers, is the sporadic sale of an asset, such as the sale of real estate or Ihe sille of a business where payment Is to be milde over time In installments. A second context, perhaps more familiar to accountants. Is treating ~ manufacturer, wholesaler or retail clienrs accounts receivables as rtMJlving credit accounts or installment receivables. In both of the foregoing transactions, use of Installment reporti ng defers rea ll~ed gain until the in· SUllhnent payments are actually received in fu ture years. For manufacturers and merchilnts. TRA '86 denies the installment method 01 "'counting. and thereby eliminates defer. rOll of Income, on aU revolving credit sales, e.g., credit sales on store credit cards and 0l~n chilrge accounts. In ad· ditlon, Installment reporting no 10llger Is available fOr sa l~ of securities or other assets normally naded on established securities or olher similar markets. Use of the Installment methods also is limited, though not repealed, for certain other sales of real or personal property. Thus, these new limitations alm1y to "applicable instal lment obligations" arising from sales of real or personal property bot dealers If made since February 28, 1986, If the sale price exceeds $150.000. Note from the foregoins efiooi\'C dates that In· stallment notes from transactions that al· ready have been consummiltoo are subject to the new rules. Under the new rules, n pro rata portion of the taxpayer's non·personal Indebtedness Is treated as a prepaymenl on the taKpayt!r'S appli. cable installment obligations, thereby artificially triggering recognition of a part of the gain. Thus. whether the t aK~ Is a corporation or iln Individual, the ilmount of their non-personal debt will directly Influence the eKtent of deferral they receive from installment sales of qualifying property. TRA '86 limits u>e of the cash method of accOtJnting. Under lhe law a corporalion, other th,m a Subchapter S corpora· The Alabama Lawyer

tion, cannot utilize the cash method of accounting If Its gross receil)ts exceed $5,000,000. EKceplioos apply only for qualified personill sef'Vlce corporations such as corporations formed for the Pr.lCtlce of law, account ing, engineering. etc. New rules also pf'f!Venl deduction of bad debts on the reserve method and require thai bad debts can be deducted 0nly when they are ipeclfi cally ldenllfied as worthless. l ikewise, Ihere are major changes In rules applicable to merchants, wholesalers and manufacturers which require that many costs previously deduct· ible now be capitalized and Included in the inventory account as an asset.

placed In service after December 31, 1986. Note, of course, that pre-eKlsting rules continue to apply to property placed In service prior to December 31, 1986. The depreciable lives of most pcrson31 property also was ClCtended, although the depreciation method itself was enhanced. Formerly Matutory accelerated depreciation was based on 150 percent declining balance, but under TRA '86 Is based on 200 percent declining balance for property whose deprcciilble life rang(!s from three to tell )1!ars. There also are new limitations on a taKpaycr's ability to buy property at year's end and receiyc the fully allowable half-year depreciation on such property.

Depreciation and inveSlment tax credil Congress repl!aled the Investment TaK Credit effective Janua.y I, 1986. Unused investment tax credit carryforward must be reduced by 35 percent after tunc 30, 1987. Investment lax credit had been available intermittently In Ihe Code over the last 25 years and was eKtremely important to all busi ness taXI)aycrs. Its re. peal will cost business taKl>J)Iers appfOJ(l· mately $50,000,000,000 In additIonal taKes. The system of depredation of business property also was substantially modified wllh the mOSt importilflt changes (ail ing on real estate. The depreciilble life of commercial real estilte was eKtendcd (rom 19 years to 31.5 yea(5, and residential real esldte was CKtended to 27.5 years. Also, real estate now Cdn be depreciated only using the slralght.llne depreciation method 0>'Cf the new, longer dcpil!Clilble II~ Accelerated metnods of deprecia· tion no longer are available for real (!Slille

Important new corporale a lternalivc minimum lax Under prior law the corporate add-on minimum tax did nOI apply to very many corporations. H~r, the new cor· porate alternative minImum tax rate of 20 percent is dose 10 the nLW maKimum cOfj>ornte laK rate of 34 percent. This small 14 percent di((erenCi! between the regular taK rate and alternative taK fa te Is not substantial, and, given the greatly expanded list of taK preferences, the alternative minimum ta:.: now frequently will exceed regular taK. The altemative mini· mum tax 15 applied to a COfpOration's tax· able income Increased (0( taK pre(. erences. New lax preference items Include use of the InslaUment method of accounting, taK-exempt Interest earned on recently issued private activity bonds, untaxed apl>reciation on charltilble con· trlbutlons of apprec;iated property and, \'Cry Importantly, one-half o( the excess of pre-tax book income over other alterniltive minimum taxable Income.

Joseph W. Blackburn i$ the Palmer Professor of law of the Cumberland SchooJ of Law In Birmingham. ,.Ie also is a scholar in residence to the firm of Sirofe, Permutl, McDermott, Slepla n, Friend, Friedman, Held &. Apolinsky. He received his undersraduate degree, wifh honor, from the Unlvcrs/IY Of Kentucky lind law degree from the Unlvcrs/ty of Virginia. He is a certified public accountant and a member of the Birmingham Bar Association and /he Alabama Slate Bar.

33J

Perhaps the ~atest uncertainty with the ahemati~ minimum tax lies in the last tax preference hem. Fifty percent of the excess of income reported for finan. clal accounting purposes a..1:!r InC(lme report(!(1 for tax purposes Is a lax preference. Onc StMlinM example of a dU· ference betWC(!n taxable Income and financial income. 50 percent of which hereafter would constitute a tax pref. erence, is receipt of Insurance proceeds on deMh 01 a shareholder. Presently, muny corporate stock purchase agreements are funded by the corporations' purchase of life Insurance. Upon the death of a shareholder Insured, the proceeds o( lhe insvr.ance policy are paid to the corporation. Such proceeds are used to redeem stock from the deceased shareholder's estate. Insurance proceeds hilVC been, and continue to be, free of regular feder.l l income tax. HoYJeVer, receipt of these proceeds \.',IOuld COnstitute financial Income. Thus, the Insurance proceeds \\WId create a dl(ference betWC(!n finandal lncome and taxable incom(', one-h.. lf 0: which constitutes a tax preference. For example, if .. corporation received proceeds of a $1,000,000 Insur· ance poUcy It would hil\le a $500,000 tax preference. When added to other alter· native minimum taxable Income, the 20 percent alternati~ mlnlnlum tax rate would apply. As much as 10 per(ent of the insurance proceeds may be consumed by the alternative minimum tax Iml)()St.-d on them. In designing stock purchase i1greements attorneys should advise theIr clients of the existence of this new tax prefererKe item and carefully weigh whether a stock purchase should be structured as a redemption bot the COfporallon or established as a cross-pur· chase agreement bct.....ccn the shareholders. This nC'oV I.I)( I)reference does not (I1m1y to (I Subchapter 5 corporation.

ness expenses, previously deductible whether the tax~r itemized, now haYe been reclassified as mlscellanoous itemized deductions. All miscellaneous Itemized deductions (such as CKpense~ (or tax prep..lratlon, Investment advice, etc.) are deductible only to the exter"ln the aSMregate they etceed 2 percent of a t,lXpayer'S adjusted gross income. Thus, the only ponion of a taKpayer's mlscel· laneous itemized deo'uctlons now which can be deduct~ Is the excess of the tO\<l1 oYer 2 percent of ad]uslt.-d gross Income. Empl'¥!C business expenses, Investment expenses and other miscellaneous Item· Ized deductions of a business nature should be shifted 11W~ (rom the In· dividualtaxpayer and into his corpora· tion, if possible. Empk¥!e expense relm· bursement plans can be established to provide this benet'lt to the employee withOut added CQ~t to the eml)loyer. Deductions (Of individual retirement accounts also have been eliminated for some taxpayers. An active participant in a qualified retirement plan whose adJusted gross Income exce«ls specified limits ($50,000 If married filing Jointly) Cilnnot make deductible contributions to an IRA. Nondeductible contributions stili are permiTted. Earnings on nondeductl· ble contributions would continue to be tax deferred within the individual retirement account itself. Each taxpayer will haw to asses~ their ir'M..'S tment and retirement alternatives to determine whether non-deductlble contributions stili are advisable.

Gene ral c ha ng~ for Individuals In addition 10 rate reductions. indio vidual taxpayers will benefit from an in· creased standard deduction (55,000 fOr married couples filing jointly In 19881 and increased personal eKemptions ($2.000 bot 1989). Likewise, some former benefits hIM! ~n curtailed. The deduction for iWo-earner married couples was repealed along WiTh Income averaging. In addition, eml)IO'y'Ce busi-

Notice of Transfe r to Disability Inactive Status

334

Meals, travel and ente rtainment e1(penscs Only 80 percent of otherwise allowable business meal and entertainment expenses can be deduclt.'d since Janual)'

On AuguST 10, 1987, Jefferson County lawyer Cheryl Rosann Dickey was transferred to disability Inactive status, based upon her own petition asserting that she was presently incapacitated from con· tinuinM the practice d law I1t rea§On of Infirmlry Qr illness.

1 of this year. The 80 pen:ent limitation applies to virtually all categOfles of bU5lness and travel·related meals. For exam· pie, meal costs incurred while tr3YCling ;r.Y<ry from home on business arc 5ubjC(t to the IimlHllion; so is the COSt of a quiet business lunch with a client. Likewise, entett:linmcrll expenses, such as football tickets, are deductible only to the extent of 80 percent of their face amount. Note thai entCrlalnment expen$eS are limited to their face cost and nOI their actual cost, e.g., the deduction for a football ticket with :I designated price of $15 for which the tax~r l)ald $100 Is 512, I.e., 80 percent of SIS, not 80 percent of $100. The test (or qualifying a Quiet business mcal 3S a deduction al50 has been tightened. In the past a quiet meal in an en· vironment conductive to a business discussion was deductible whether any ilCtual business was discussed. Aftcr TRA '86 a business meal Is subject to the same StrinMCnt test as entMalnment ClI· penses, I.e., the business ~al must be shown to be directly related to the con· duct of business or directly associated with the conduct of business. To satisfy these tests business mUSTac:tuilily be discussed or conduaed during the meal, or the meal should Immediillely precede or follow a sub$tantial business mCCtlng. Income ta1(ation of minor children In the past many parenti provided for their children's collcge education by Ir· rcmcably transferring funds to bank accounts in their children's names. Earnings on the accounts were taxed at the 100000f tax rates applicable to the children. Un· der TRA '86, the unearned income of a chi ld under the agc 0114 which exceeds $1.000 is taxed to the child at the p..lrents' top lax rale. Whether the aS5et which produced the unearned Income came from the chlld's parent or anyone else Is Irrelevant. This provision, when coupled with the elimination of the "Clifford" trust (sometimes referred to as the short-term or tenyear trust), mJkes it extremely difficult for parents to rund their children's college education. Some insurance policies and Series EE U.S. Savings Bonds, which allow deferral of intome recognition by the child until they reach age 14, should be considered as investments for minors. Many states, though not Alab<lma, already have adopted or are conSidering November 1987

the establishment of prepaid tuition programs to prCl'llde tax advantages for p;!rents strving for their children's college education.

Limits on deductibility of losses aris-

ing from passive aClivities Prior law did not limit the use of deductions or c~hs (rom a particular busi· ness activity to ol(set Income (rom other activities, except In certain IImitt..'CI cir· cumsta n~ However, under TRA '86 nev.' limitations have been imposed which, due to their nature, will change the structure of many legal transact/ons and likely will change taxpayer Invest· ment patterns, The Code now has creat· ed a I'Ie'N type of activity called a "passl\IC aclivity.H Income and losses from passiw activities n(lYl hiI\C particular Importance to taxpayers. In the future Income and losses are to be divided Into one of three categories: Income from pas~lvc activities, acll\Of Income and pomol 0 Income. Portfolio Income generJlly ,s inW?Stment income, e.g., dividends and Interest. The difficulty Is distinguishing bet\'leen aCllve Income

and passive income, Some activities are conclusively presumed to be passive ac· tivltles. EKamples are ownership of a limited partnC!rshlp Interest In a limited partnership and, subJeclto narrow exceptions, all rental activities. In other situa· lions look OIl all the facts and circum· stances to determine the nature of the activity (or a panicular taxpayer. For example, assume A and B (orm a Subchapcer S corporation and each owns one-half of lhe stock. At the end of the year a portion of the Income or loss from the Subchapter S corpor.ltion is allocated to A and B. The question arises fOr both A and B as to whether such Income or loss Is from a passive activity. If A only has provided capilal and does nOl mao terlally partldpale In operation of the Subchapter S business. then the enUre activity Is "passiv~t as to A, If, hOV>'eVCr, B matcrlally participates In the operation of the corporJtlon's busi ness, then the Income or loss would be "active" as to 6, "Material participation" In an enlerprise Is defined as active InYOlvement In the enterprise on a regular, conl lnuous and substJntial basis. This "mJtcrial partlclpa-

NOTICE 1987-1988 OCCUPATIONAL LICENSE SPECIAL MEMBERSHIP DUES WERE DUE Octollcr 1, 1987 This Is a reminder that all Alabama attorneys' occupa· tional licenses and special memberships EXPIRED September 30, 1987. Sections 40-12-49, 34·3·17 and 34.3.18, Code of A!ab<lma, 1975, a~ amended, set forth the 5t<llutOry requirements for licenSing and membership in Ihe Alabama SWtll Bar. Licenses or special membership dues are payable bet'NCCn October 1 Jnd October 31, without penalty, These dues include a $IS annual subscription 10 The Alabama Lawyer. TheocCUl>dllonallicense should be pu rcha~ from the probate Judge or revenue commissioner in Ihe city or town In which the lawyer has his Or h!;!r princlpal office. Special membershi p dues should be remiued direetly 10 the Alabama State Bar in the amount of $75, I( you have any questions regJrdlng ')<>ur proper membership $tatus or dues payment, please contact AUce 10 Hendrix at (205) 269·1515 or '·800-392· 5660 (In·stale WATS),

tionH standard is applied to a taypayer who owns an Interest In il business (whether that Interest Is as a prol)r1etor, general partner or S corpoJ9tion shareholder) to determine whether the activi· ty Is passive as to that taxpayer. As noled alxNe, all rental activities are presumed to be passive activities. HO'Wever, certa in individl.lil l laxpayers can own rental real estate businesses and d('duct losses up 10 $2S,000 per year. To (IUalify for this deduction the taxpayer must be actively IrMll-.ulln the rental activity. This active particlpatlon requirement presumes that a taxpayer owns a 10 percent or more interest In the activity and Is slgnlOcl'lntly and bona Odedly involYed In rental of the property, The tax· payer's $25,000 dedUCtion will be phased out at the rate of (lfty cents on the dollar to the extent his adjusted gross Income exceeds $100,000. Thus, a taxpayer with Income under $100,000 would get the full $25,000 deduction and a taxpayer with adjusted glOSs income in excess of $150,000 would receive no deduction. Once a taxpayer Is determined to have engaged In a paSSive activity, new loss

AFFORDABLE TERM LIFE INSURANCE FROM COOK & ASSOCIATES Comprlte ,...... lOW non--lrnoIItf ,nnutll ',UII CleCrualno orllCle<l ptemll,lm 1,le MAle ABU

.." .." ""

U5~000

$11.00,000

2150.00 252.SO 2iSiS,00

4$15.00

,,.00

"'.00 "'. 00 1St5.00

'12,SO 180.00 542.50 1,015 .00 1 10.00 1.520,00 1,355,00 2,1535,00 2.372.50 4.:115.00 (II'IIOUr'. '11 •• tllghtly higher)

non·

$1 ,00II,000 1'10.00

In.so 1111.00

'10.00 1,127.110 1,510.00 2,217.50 3.710.00

U".OO

A_lIb1t1 10 10' 100. F,m," rill" um, IS mil" lour y.... yOll"" •• All co~erao' pro~ldId by eomprlnl. ,aled "A Excellent ' b y eelt Co. Fo' , w,ltten ql,lotltlon ,nd polley CitlCrtptlOll Nnd )'011' dal' 01 blnh ,nd .mount at ClOYtfloe dKwed to

"'.M

COOK & ASSOCIATES 2970 COTTAGe HILL ROAD . SUITE MOBILE. ALABAMA 36608 411-1731

The Alabama Lal',ryer

.or

lOt

Building Alabama's Courthouses by Samuel A. Rumore, Jr.

The fo llowing begins a hislory of

Alabama's count y Courthou $e~-their origins and some of the people who contributed to their growth . The A/abilmauwyer plans to run one ~oun· Ir's slory In each Issue of the magazine. If you have IIny photographs of early or present courthouses, please forward them 10:

Samuel A. Rumore, Jr. M iglionico & Rlimorc 1007 Colonial Bank BuUdlng

Birmingham, Alabama 35203-4054

Jadson County Jack50n County W;lS crea ted Decem· ber 13, 1819, one day before Alabam3

achieved statehood. It is IOC,lted in the northeast corner of the state, Md bordcf"5 00111 Tennessee and Georgia. The vast majority of early seulel'S Came from tht'S(!

siales, as well as from the Carolinas Md Vi rgi nia. The Alabama I£glslaturc named the county fo r General Andrev.' Jackson, hero of Horseshoe Bend, who had al· most as many tie. to Alabama as he had to Tennessee. This first legisl;:uure was assembled in Huntsville, and it chose to honor Jilckson who was visiting the t(1)Nn at that time. He was engag(.>(! in horse radns. a popular Sport of the day, atthl! O ld Green Boltom Race Track. The legislature of 1819 designated Sauta Cave as the temporary seal of justice of Jackson Coumy. The cmmty cour1 was given power 10 select any other

338

location It deemed to be more expedient. Little Is kn(1)Nn of the firs t cour1house ex· cept that It wa s four miles south of LarkinsviUe, and built of logs. On December 13, 1821 , the Alabama legislature crea too Decatur County (rom land taken out of Madison and Jackson counties. The signlflcant point (or this action was that Saula WilS located on the borderline of the new CO\lnty, If not, in (act, placed in Decatur County. Therefore, the t(1)Nn of Bellefonte wa s sel(.>(:ted as the second temporary county seat of Jackson County. As a footnote of history, Decatur is sometimes called the "Lost County of Alabam a." It was abolished December 28, 1825, and its territory was redivided bet~n Madison :md Jackson countieS. The county seat of the former Decatur County, Woodville, is located today In Jackson County. Although Bellefonte on the Tenne.see River W<lS selected <IS the second temporary seat of justice In 1822, a permanent site remalnoo unresolved for six years, Flrlally, Dr. Gcor'Se Washington Higgins and Stephen Carter donated land at Bellefonte (or a courthouse building, It wa s built in 1828 of local· ly-made brick. In 184 6 the cou rthouse In Bellefonte suffered fire damage, probably (rom a fireplace or chlmn,-')' fire, However, the bulld lng was not lost, and contInued to ~rve the county, By 1859 the building was in great need of repair, and the legislature passed an act calli ng for an election in May 1660 to determine

whether the courthouse should be moved , If the vote was for removal. the act c"lIed for a second eleoion in Augu st 1860 to determine a suitable site, In the first election, the ~op l e of Jackson County YOted for remov.ll. In the second election, four towns made an effort to obt"in the cOurthouse-StMnson, Larkinsvll le, Scottsboro and Hollywood, StMllson 'M)n thc dectlon, but all plans fo r rNYloval from Bellefonte were post· poned due to the War Between the States, During the war, the Bellefonte Courthouse wa s burned by Federal troops, ScQtt~bo ro at this time was smaller than either Stevenson or Larklnsville, but Its (lUnder, Robel'! Thomas Scott, was an enterprising viSionary. He had served in the state legislalure on five occasions, He acquired considerable property, and later a tra in depot was constructed beside his lands. Though he died in 1863, SCOII'S heirs pursu ed his goals and conl inu(.>d the political inn uence of the family patri:m: h. Through the Innuence or Scottsboro State Senator Charles O. Whitney, the legis lature passoo an act October J, 1863, all(1)Ning the Jackson County Commission to choose the county seat. The resolution also provided that the site selected must be on the M~m phis and Charl eston Railroad and wi thin eight miles of the center of the COunty, By this tactic, the 1860 election, In which Stevenson was ch'osen, became void. And, with the added restrictions, Steven. son arl d larklnsvilte now were ineligible sites,

N ovember 198 7

I.lckson County Courthouse On Saturday, September 5, 1868, the county commission met at Bellefonte. On the subject of relocating th e court· house, Scottsboro received three voles and Cowan Springs one vote. On November 13, 1868, Ihe county records were rcmCJ\lCd to Scottsboro and the sig. nlflcance of Ihe town nO'W was secured, An advertisement fOr bids on Ihe nev.' courthouse was published in January 1869. The courthouse was to be 50 feet and 8 inches square, made of brick and patterned ilfter Ine Limestone County Courthouse. John O. Boren of SteYenson, Alabama, won the COIl!rilC! for $24,500. The new courthouse was ready for use In April 1871. II WAS repl,lled to be the finest building In the county. Unfortun· ately, II burned In February 1879. The county decided to rebuild Ihe SlruC!ure using the original walls. By NCM!mix!r 1879, it was reporled that the courthousc once In ashes had returned 10 Its former glory. This building continued to serve the county unlil 1912. As early as 1909 Ihere was talk of the need for a new coutthouse. In 191 2 the Willis of Ihe existing building INCre con·

The Alabama Lawyer

demned, ilnd the county commission contracted to build a new courthouse. The citizens of 5te\enson and Bridgeport, In the northeastern part of thc coun· ty, 'vOCally opposed the construction of tI new courthouse unless the people voted on where It should be built. They flied tin action In chancery court seek· Ing 10 c.. neel the contmct. This suit was dismissed, and the presenl courthouse was built in 1912 lor appr(lKlmalely $44,000. It was this courthouse tha t

became fitmOus worldwide in 1931, due to the first "Scottsboro Boys" tri31. The courthouse In Scousboro was ex· tenslvely renoYated and enlarged with the addition of Ihe side wings In 1954. These improvements COSI $350,000. A second significant courthouse addition was completed in 1966 at a cost of near· Iy $ 1.000,000. A history of the Madison County Courthouse will appear In Ihe January Issut:'! of The Alabama LAwyer. •

Samuel A. Rumore, Ir. , Is a 8raduate of the University 01 NOire Dame and Ihe University 01 Alabama School of Law. t-Ie served as foundin8 chairman of fhe

Alabama Slate ~r's Family I.Bw Secr/on and is in p'i;lctice in Blrmln8ham wifh Ihe firm of M i8/ion;co & Rumore.

339

Alabama State Bar

BOARD OF BAR COMMISSIONERS' ACTIONS July 15, 1987, Mobile, Alabama Presen t: COll'mlssioners Jackson, Hamner, CrownO'Jer, O'NCns, Love, Cole-

man, W.)tson, Edwilrds, Lloyd, T, Coleman, Bland, Davis, jllmes, Hisginboth.

(1m, Hill, Cassady, Lott, Holmes, Engel. Cook, Seale, Martin, Head, Bowles, Bilxkoy. Garren, Albritton, Royer, Cosa, Vinson, BraSScIl, C. Hare, Chilson, Hen'!/'ord, Knight, Matthews, Bouldin, Mehon,

Wh1!c, Mams, Proctor, Alex.loder; Presi· dent Scruggs; Presidcnt-elect Harris; past President North; YlS President Black;

Executive Director Hamner; Assistant General Counsel Jackson: Assistant Execu tive Oirector Pike. Absem: Commis~ioners Turl'lt'!r, Thtlrn·

ton, Reeves, F. ,.Iare, Dillard, Laird, Gill, Mtmley, RCM'C, \M)od and Jones. The board: -

340

amcndt'<l the minutes o( the Com-

mission's M~ IS, 1987, 111(:(:1)1'180 (Ofre(1lnS thf v.()rdinS of Rule I.S(e) Qf the Model Rules r)i Profe~slQnal Conduct. arlt:! appruved the minutes, as amended; welcomed n(,'W membc~ present; administered four prlv.ue reprimands aoo two public censures; he .. rd the president appoint Commissioner Proctor chairman of the Discipiinarj' Commission fOr Garren and C. Hare; hC~rd the preslder'lt ~PJ'lOlllt Comml~$loner PrOCtor ( halrMan of the Disci plinary Commission lor 1987-88 aoo eleclcd Commissioners C. ~t ~r(l a"d Njams to SCIVC as the other twO fTlembcf"§ of thll comml$$lon; el('Ctcd ~n ti thil bar'!; ilisht members OIl the 80ard 01 Directors 01 the Leg~1 Services Corpor.ltion of Ala· bama, Inc.. and postponed election of a $Gutheas! Alabama reprcs.cntaliw: Ix:.ldl<lg COfllmlssloner B3)\1ey'~ cop'Sult<ttlon wl1h the Houston County Bar; rt'Ccived the report 01 the EthiCS Education Committee that ethics eduC30

tlo" should be a part of any discipline Imposed, any 3nOrntly appl yIng for reinstatement $hould be required 10 pass the elhlcs portion of the bar Cl(ilmination prior to reinstatement. one additional hour of continuing legal eduCMlon specifIcally devoted to ethics should be lequlred of ~II mt mbms ol the Alabama State B~r and mOllCy should be sel aside for production or ac. qulsition of an ethics educatloPl videotape Or ta~s; V(ltOO 10 IJllfy the recommendation of the excculll/C commillee to the supreme court that Rule 8(b)(2) of the Rul M of DI1oCiplinal)' Enforte"1e.lt be af'r'lMdro to lirovide Ihllt where a grievant)! commll1f:e hllS not submiut!d its report 01 an Invcstig.ationto the Disdplinal)' Commission within one year from the date the complaint was received or thc /llV(!stlgatlon was commenced, whiCh(Mlr is ....III1~r, the commission ~ hall nOllfy the grle'o',lnce committee to su bmit lis report within 30 days. and II the report has nO! been rc<ei\lCd wllhin 30 days, the commission I'My order the 1fM.':Sliglltion to be taken OYer by the gener~1 coun!iCl; ratified the action of the ~ccuCivt' committee ~lm~ln8 merger 01 the Committee on lesnl ScNlces to the Elderly and the Ta.k Force on Legnl Services to the Poor; ratified the action of the executive comminee disapproving the bolr'S participation in an advt'rtisement seeking to mtract business to the Slale of Alabama I... the w;tke of tort rclorm; d(''(llod Milton C. D~vls, DcboT<lh I. tong apld Roy J. Crawford as bar examiners: approved substit ution of a West tn_ dlcs/Panamn CnPI;)1 tour for the previously schedu led Vlrgl ... Islands cruise, as pM 01 the bar's apprO'led travel progrJm for 1966; rccci\ll!d the fillanda l report for the th.-ee qu~rter> cooing lune]o, 1987,

with exJ}Cnscs totnlll"8 snO)S2 to dilte and ~Ilue exceeding expenses by $1]4,418; received a r<:port on a bill pendlnll In the Alabama legislature providIng for MVe rslon to the state's gencliIl fund 01 money whkh hlMoricalIy ha~ rcmaln(:d in the bar 'rust fund; ..dopted a resolution memorializing past President Alto V. lee, III; hcard the presldent's f1)JlOrt that the su preme court 1,,,(1 Issued orders dared May 5. 1987. approYi ng C$tablishmcnt of a Client Security Fund and Interest on Lawyer Trust N.counts progmm; accepted Ihe rellremeot 01 Ceneral Coun~1 Wllliilm H. Morrow. Ir., effective October I, 1967, and authorized part-time employment of Holly l. Wiseman as assistant general counsel, urldcr th~ terms of a pct1()n~ 1 !oCrvice~ (Olltra(l; de~18n~ted I«.>gln"ld T, Hamner ~cl tng gcnera! counsel.

July 18, 1987, Mobile, Alabama Presenl: Commi ssioners hIckson, Hamner, Crownover, Owens, Love, A. Coleman, Walson, Edwards, Lloyd, T. Co l~man, B!ar'ld, Hlgghloothall1, Hit!, Cassady, Loll, Holmes, Engel, laird, Crook, Martin, Head, Bowles, Garreu, Albrlnon, Royer, Rowe, VInson, Brasselt, C. Hare, Chason, Hereford, Kn lshl, Mal· Ihews, Melton, Adams, Proctor, AleJ<..lnder; President HMris; past President Scru ggs: Presiden!-elecl Huckilbr; YL.S President Mixon; Executi~ Dlreclor Hamner; Assistant General Counsel Jackson; and AsslSlam Executive Directo r Pike. Absenl: Commissioners Turner, Thornton, Reeves, F. Ha re, Diltard, Davis, James, Git!, Seale, Mantey, Baxley, Gosa, Wood, Jones, Bou ldin, White. The board: -accepted the resignntll)n of W.N. Watson, commissioner Irom the November 1987

Ninth Judicial Clroolt and clectf!d William 0. ScnJS8i. Jr., as his replacement; - rKeived the repor1 01 the nominatIng commlltee and clectt.'<.I the fol lawlng: Oliver P. Head, vice president; Rcgin.Jld T. Hamner, secrelary; Phillip Adam5, FmJlcls ~tm'e, I~arold .... Ibrinon, clU!Cutlve commluee; Phillip Adams, lynn JlICkson. David Knight. \oVack! Baxley. Wayne loYe, BrOOX Holmes. la~ ~ale, Mason Davl$, George Royer, MCLE Commission; disciplinary l)(wd members: P,lnol I-Commlssloners ColemM, lacluon and Davis P,lnel II- Commissioner CIII Panel Ill- Commiuloners HIli. Thornton ~rJd Gosa PanellV-Cornmissioners Knight and Rowe Panel V-Commlsslonm Mlll'lley, loll, Crook ~nd Mehon

September 25, 1987, Monlgome ry, Ala bama Present: Commissioners Jackson, Reaves, Har'l'n'lt'!~ CrQWllOYer, Owens. loYe. $cruW, Edwards, lIC¥I, T. Coleman, Dillard, Bland, DiWls, James, Hig-

- receiW!d ~ repor1 from the Loc.al ~r Acllvlties ~nd SeNices Commillee, Torn King, Ir., chairman, updating 1M board on the H8uddy ProgfiJm; now krmwn as NLaw~ Helping Law~rsr and efforu to Impl'OYe comml.mlCilllon beiWtlf!n thf! stille bar and loc~1 bars; - applO'o'OO the expenditure of SI.ooo for an outside! {...... Iuation 01 the bar examinat ion, to be conducted by AtJbYm UnIversity; - r«4!i~ ~ l'e!)Ort of the activities 01 the Insul'ilnce Pl'01ll'ilffiS Commillee by chairman Henry Henlel arnJ authorized the expendlhlfC of $5,000 to update thl! ~1lr-old survey on members' willin5ness to participate In the caplt~lIzatlon 0( a caPtive ~ fesslon~1 IlabUlly Insur.ance company; - rtCeived an upcate on lOll.... acIlvlt les by .... Iabana I.;lw Foundation vice chairman Charles Hare; al>' pr<M.od the recomm{!r1dallon thaI the IOlTA Task Force be made a SMndlng comml:tec of the bltr; authorized the prelldcntto IlIlSOIlate with the foundation 10 hire an .... IaI»ma Stale Bar fmpl~ 10 serve as lis executive direc1Of, undl!f contl'ilct with the foundation;

- was Informed by !he presldenlthat many oIthf: 95 inmalCS on death ff10N ~ no legal coonsci.anl gnOO and ~ t~dc force Is belrg al>pOlnled to recommend ~cl lons the bar should take In Ihls m.ltcr; - heard thll secrelary's Il.'pOrt that bar cx.amlnatlon resuhs were mailed Scptflmber 25, 1987. alld th~t 65 percefll diM! ]69 CX.lmlnees were certinf!d 10 the supreme court lor adminion to the bar; - adopted resolutions memoriallzinll Mobile Bar membe!'5 Daniel W. Moilo.,.. E. Grilh ~m G lbbon~ and Ceorgl! E. Stone; _ 81mroved 11 ,...Iary Incrc.§flior a staff member who haS ta~en on new responsibilities; - authorized the llXI!Cuti'oC director 10 enter Into COl'ltraCH w~h an airline and hocel for tlwl Iw's mld)1!ar Il"oeCIlng and «WllparatMlIIIW seminar, to be collductcd in Acapulco, Moclco; - W,lS IIlfomlCd Ihal the itl)Or t of tht! .... Iabama Examiners of ,4,cCO\JlliS for n sc~1 ~~rs 1984-85 and 1985-86 hold been re«lved and copies would be IofWOlrded to bo<Ird members.

ginbotham, HIli, Loll, Holmes, Engel, Gill, Crook, Seale, Head, Boo.vles, Baxley, Carrett, Royer, Rowe, Vinson, C. "'tille, Chason, Wood. Jones, MeltOn, While. Adams, PlOCtor; President Harris; YLS President Mi'(Qlli Executive Director

Hamner; Assistant Executive Director Pike; Local Bar i\(livilies ;md Services Commi ttee chairman Tom King. Jr.; Insurance Programs Committee chairman Henry He nlel. Absent: Commissioners Turner, Thornton, A. Coleman, F. Hare, Cassady, Laird, Martin, Manley, Albriuon, Gosa, Brassell, Hereford, Knight, Mauhcws, Bouldin, Alexander. The board: - ~ ppl'CM.'d minuK'S of the July 15 and July 16. 1987, boord mCt:t lnll~ and appl'ClYl!d. as amended, minutes of the July 18. 1987, annual busI ness meeting; - ~mlnlStere<l nve prlville repri· m~nds;

rocei~ ~n

Informallonal repon on a for.profit lawyer referfiJl 5eNlce and, because such a scNke Is not permln(!(j uflder currelll rules, 'ele,,oo thc milner to thll Disciplinary Commission; - elected HOOllon County Oar member 50011 Hedeen as thetlghth .... Iabama State Bar member oIthe L.eg.ll ServlcC$ Corl>Ofalion Board of D I ~tors;

The Alobilma Lawyer

Introduce Your Clients to a Valuable Service. l\crcr them ro Business Valuation Services ror expert dctermination of fuir markct value of busincsses, and financial analysis and consultation in cases or:

o Estate pL-uming o Estate settlement o Marital dissolutions o Rcxapitalizations o Employt.'C stock

0 8ankntptcy proceedings

0 Mergers or acquisitions 0 8uy-seUagreemcnts 0 Dissident stockholder

ownership plans suits Contact Dr. John H . Davis, ill 4 O ffice l'arkCirtle • Suite 304 • Binn ingham, Alabama 35223 P.O. Box 7633 A • Birmingham, Alabama 35253 (205) 870-1026

341

•

ele opportunities 17 tuesday

19-20

BLUE SKY LAWS Georgia State University Urb,m WE'

FEDERAL TAX CLINIC Paul Be.1r 8ry.1"1 Center, Tt.$CaIOOS<! Credits: 15.3 (205) 348·6222

Center, Nlillll'" Conti nuing Legal Education Satellite

15-19

Network

Credlls: 6.6 (2 17) 52S.()744

Cost: $155

PROSECUTION OF A VIOLENT CRIME

The Monteleone, New Orlea ns Nalional College of District Attorn eys (713) 749-1571

16-17 SECTION 1983 CIVIL RIGHTS lITlGA· TION ANO ATTORNEY'S FEES

wednesday

FEDERAL ESTATE AND GIFrTAXATION AND ESTATE PLA NN ING

Joe Wh~ler SIOl!e Resort, ROtll!fSVUll' University of North Alabama

(r«lIIS: 7.8 Cost: $145 (205) 760-4289

The Biltmore, Los Angeles Practising Law InSCilule Credits: \3.2 Cost: $250 (212) 7&5-5700

19 16-19 fUNDAMENTALS O F GOVERNME NT CONTRACTING Sheraton National/Arlington, WM hlngton, O.c.

FederJI Publlcmllln), Inc. Credits: 27.3 Cos!: $850 (20 2) 337·7000

thursday

DAMAGES Civic Center, Birmingham Alabama Bar Institutc for elE

Credits: 6.8 Cost: $85 (205) 348·6230

CIVil PROCEDURE Sller,lIon, Dothan Alabllmil aar Institute (or ClE Cred!ts: 6.3 Co~1 $85 (20S) 348·6230 GENERATION SI( IPPI ~G. PLANN ING AND DRAFTING Law Cenler, Tuscaloosa (Silleilite progra m) Alabama Bar Institute for Cl f Credi ts: 4.6 COSI $125 (800) 253·6397 BUSINESS TORTS Ramada Civic Center PI.17.a, Slrmingh.1nl Cumberland Institutc fo r Cl E Credlls: 6.6 Cost: $90 (20S) 870-2865

342

PERSONNEL LAW Terrilce GMden Inn, Allanla W.lkt· Forc~ 1 Universlly School of l.aw Credit!>: 12.0 Cost: $350 (919) 761·5430

friday

DAMAGES Civic Center, Montgoml.'ry AI.lb.II11.1 B,l( Institule for elE Credits: 0.8 CO~I: $65 (205) )46·6230 CIVil PROCEDURE Iioliday Inn, Shf.'{Oeld Alilbama Bar IrIStituf(> for elE Credits: 6.3 COSI: $85 (205) 348·6230 CIVllllTiCATlON AND TORT REFORM Huntwlll(" AIJbama Trial lawyers As~iation Credits: SA (20S) 262-4974

CRIMINAL FEDERAL TR IAL PRACTICE Birmingham Blrll1lngh.lnl 8ar Association C r(>dl l ~: 3.2 C05t: $25 (205) 251-8006 BUS INESS TORTS SherJIOrl Rlwrfront, Montgomery Cum!Jerl,lnd Ins!itu\e for elf Cl'('(ll t5: 6.6 CO~I: $90

(205) 87().286S

CRIM INAL DEFENSE Holmada R(,".li~..ance, Jilckson Univcr;ity 01 MI~si5~lpl)r Cerler for Con· tinuing leg.ll EduC;lIlon Credll~: 7.2 Cost: $110 (6011 982·6590

November 19B;

4-5

3 thursday BANKR UPTCY CIvic (emer, Binningham

Credits: 6.9 Co~t: $95 Alabama Bar Instllulc fOr eLE (205) 346-6230 BANKI NG LAW AN D PRACTICE

Law (emcr, TUsc.lloosil (\.llellile program)

Alabdma Bar Institute for elE Credlb: 4.6 Cost: $125 (800) 253-6397

BANKRUPTCY LAW AND PRACTICE Tradewinds, 51. i>c!!!lSburg Stetson University School of L1W Credits: 14,0 Cost: $250

CIVil PROCEDU RE (video replay)

(613) 343-1214

(205) 348-6230

10 thursday TR IAL ADVOCACY: WINNING AT TRI AL

CI'Ile Center, Birmlngh.'lnl Credits: 7.4 Cos:: $95 Alabama Bar Institute for

(205) 346·6230

elE

EMPLOYEE 8ENEfITS IN CO RPORATE TRANSACTIONS L..1w Center, Tuscaloo.a (satclllte program) Alabama Bar Institute (or ClE

3-4

Crt.'CIits: 4.6 (800) 253·6397

FEDERAL TAX INSTITUTE Opryland 1-loICI, Nashville Tennessee Federal Tal< Institute

Credits: 15.0

Cost: $425

(615) 822·5662

ESTATE PLANN ING

Cost: $95

(205) 348·6230

friday

PROOF OF DAMAGES AFTER TORT

REFORM Radisson Admiral Semmes, Mobile AI.lbama Trial Lav.!yers Association Credits: 3,4

TR IAL PRACTICE UPDATE

6.3

(205) 262-4974

WINNING JURY TRIALS Coliseum Ramada. Jackson

University of Mis~i~sippi Cenlcr for Continuing Legal Educ,lIion

Crcdl l ~: 7.2 (601) 982-6590

17 thursday NEGOTI ATION AND Sm LEMENT

Riverview Plaza Hotel, Mobile Alabama Bar Institute for CLE Credlt$: 7.5 Cost: $95

(205) 348-6230

18 friday NEGOTIATION ANO SmLEMENT Harbert Center, Birmlnghum

Alabar'llil Bilr Institute for CLE Credits: 7.5 Cost: $95 ADMIRALTY LAW FOR NONADM IRA LTY LAWYERS

Mobile Mobile Bar Associa tion Credits: 3.0 Cost: S25

(205) 433-9790 TH E BEST OF CLE

CQliSeum Ramada, Jack~on University of Mississippi Center for Continuing Legal Education Cred its: 7.2 Cost: $110

(601) 982-6590

(205) 262·4974

The ....'adison Montgomery AI,lbama Trial L.1wyers AsSOCiation Credit~:

Law Center, TuscalOO5.1 Alabama Bar Institute fOr CLE Credits: 6.3 Cost: $85

(205) 348·6230

Civic (enler, Montgomery Alabama Bar Institute for ClE Credits: 7,4 CoS!: $95 (205) 346·6230

Harbert Cenler, 81 rmingham AI"ba!ll{l Bar Institute for elE

Credits: 6.6

Cost $125

TRI AL ADVOCACY: WI NN ING AT TRIAL

friday

wednesday

Cost: $110

The Alabama La.vyer

14-15 f i NANCE AND ACCOUN TING FOR LAWYERS

Washington, D.C. Southern Methodist University School of Business Credits: 10.0 Cost: $375

(21 4) 692-3336

19-20 HOW TO REAO AN D EFFECTI VELY USE MEOICAL RECORDS

Caesar's Palace Hotel, Las VegJS Medi.lcgJI Institute Credits: 11.0 Cost: $425

(818) 995-7169

• 343

Bar Briefs CORRECTION: tn the September iswe of The Alabama llIwyer, under Ihc section entitled "Bar Comm issioners elected;' the biographical sketch of George M . Higginbothtlnl contained an

error. His office address $hould have

been listed as "Bessemer," nOI Birmingham, Alab.ama. The edllors regret

any Inconvenience Ihls caused.

50'year members honored The 1711'1 Judicial CirculI Bar AsSQc:;ialion (Sumler, Grrenc and Marengo counties) re<:ently passed two resolulions honoring Joe c. Camp and David M .

Hall. Both (amp and Hall have pt'dCliced law at IC;Js! so rears each,

Camp was born In Gadsden and attended high school and college In A'abama, grilduilling (rom Ihe UnlversiIy of Alabama School 011..,.,.., in 1937. He has practiced In Marengo COunty since Ihen,

Camp served (Of' many )'Cars as Marengo County District "Homey and dewled spare time to serving as chairman of the Marengo County Democratic Executive Committee.

He still practices in Linden. HaU, a native of Moundville, grew up in EutiIW, Alilbilma, and graduated In 1936 from the Unl\(!rslty of Alabama School of Law. He then began practicing In Demopolis and conlinui!d there unl ll he Joined the Army In 1941. He rellred from the Ar. my In 1946 at tile rank of colonel and returned 10 the practice of law. Hall has served both In the Alabama House of Representalives and the Senate. He retired from the practice of law September 30, 1986.

Seven A labamians added to Acad· emy of Honor Judge C J, Coley of Alexander City, secretary of the Alabama .Academy of Honor, announced that seven Alilbilmians were Inducted inlO the academy August 17, 1987, in ceremonies In Montgomery. Elected by curfenl members, the scven new Inductl..'eS are Thomas A. Bartlett; J, Claude BeMen; Edward M . Friend, Jr.; Guy Hunt; Joseph Lamar lanier, Jr.; James C. Lee, Jr,; and Ern~1 G. Williams. Bartlett, a natl~ of Salem, Oregon, for· merly was president of the American

~'~i:-

Sumdln& left 10 righ t: Banlelt; Hunt; Judge John Patterson, who serves aoS chairman 01 the academy and was a /969 Inductee; Lanier; seated: Benne,,; Lee; Williams; Friend

344

University in Cairo, Egypt, and Colgate UniYersity. From 1977 10 1982, he 5ef"lled as president of the Assocla(lon 01 Ameri· can Uni\1!rsllies. He presently 15 chancellor of the University of Alabama System. 8ennett, {l native of 6lrminghilm, is professor and chairman of Ihe Depart. ment of Medicine at the University of Alabama ill Birmingham. He is editor·inchlcf of the Amer;can Journal of

Medicine. Friend, a natl\1! of Birmingham, Is a Brigadier General, USAR (retired), He Is a practicing attorney ,lnd partner In the law nrm of Sirote, l'ermutt, Friend, Fried. man, Held and Apolln sky In Birming· ham, Hunt, a naliYe of Holly Pond, is gover· nor of Atabam<t. lanier, a native of Lanett, Is chairman and chief e)(ccutive officer of Wc~ t Point Pepperell Corporation. Lee, a native of Birmingham, Is chair. man and chief executive offi cer of Buf· falo Rock Company. Williams. a native 01 !\'\aeon, Mississippi, is chairm(ln and chiel execul ive of· ncer of Affiliated Paper Comp;lnies, Inc. l'le formerly was elU.'CutiYe vice pf\.'Sident of Gulf States Paller Corporation. He has bt!cn a trus tee of the Unlvcrslty of Alabama for 30 years. Torbert elecled to head nalion 's

chief juslices

Alabama Chief Justice C.C Torbert, Jr., bf!came president of the National Con· ference of Chief Justices Augu st 2 v, the con ference's annual meeting In Rapid City, South Dakota. TOfbert moves to the presi. dency from the position of president-t!tccl, As president of the conference, he also became chairman of the board of the National Center for State Courts, the organization providing support, re5eiHch and educatloll<ll services for courts in the 50 states and '-__Torbert ::::':::::--:-...J the U.S. territories. Torbert has served as chief Justice In Alabama for the past ten·and-a·hatf years aftcr service In both the Senate and House of Representatives of the state legislature. Torbert succeeds Chief Judge Robert C Murphy of Maryland u president. -Admini$trative Office of Courls

November 1987

Recent Decisions by John M. Milling, Jr., and David B. Byrne, Jr.

Recent Decisions of the Supreme Court of Alabama-

Civil Damages" , recovery for permanent injury normally not allowed where expert medical evidence positively refutes claim Jones v, Fortner, 21 ABR 2934 (May 1, 19871-Foltncr sued jones, alleging

injury to his neck, back and shoulder. Q\lCr defendant's objection, the court InStructed the jury on recovery or damages for permilnentlnjury, PlainIlff leslined that he had experienced scvcre !'Icck pain since the accident and was 51111 In pain. The only expert medical evidence offered was that of an orlhoped c surgcon who treated plaintiff after the accldent; the dlXtor described plaintiff's Injury as II cervic.l1 wain arw:i tcstWed he did not feel plaintiff had any permanent Injury. The defendant raised his objection again on ITl(ltion for neo.v trial , The motion W.lS (b)lcd and defendant ap' peals, The supreme court reversed, The supreme court rccognlted that Ihls precise Question has not bt.'tm ad· dressed by ALlbama appellate courts. The court noted th,1I plainti ff's Injuries were 1'101 obvious, and, therefore, C:lIpert evidence was required to prove

whether the injury was permanent. The testimony of the medic.,1 ClCpen was that th e injury was not perma!'lent. When the testimony concerns matlers bcyor\d the maim of the Jury's kr\owledge, the Jury Is bound by the testimony of the expert If It Is ur\contradlcced and penalns to subjects 'Of experts alone. The supreme coun also noted a distinction between future pain and suffering, 4Vld permanenl in· Jury. GenelOlIy, it is not necessary that an Injury be Pflrmancnt in order for a plaintiff to recover for future pain and suffering. Evidence. , .

spousal wiretapping subject to federal wiretapping statute

w hn M. Milling, Jr., is a member of the arm of Hill, f-IIII, Carler, Fran-

co, Cole & Black In Monlgomery. He Is a graduale of Spring Hill Collese lind the University 01 Alabatrnl School oI l.8w. Mil/ins covers the civil portion of lhe decisions.

Ex parle: Wilma M. O'Oanlel (R.E: O'Oan/e/ v, O 'Dan lel}, 21 ABR 3450 (june 12, 1987J- The supreme Court granted certiorari to determine whether the trlol coun erred In cxcludlr\8 from evIdence re-recorded la l)(!5 of telephone convelOiltions bet'Neen the husband and his alleged polfamour. The wife recorded all telephone con· \lCrsallon$ that occurred on the busi· IlCSS telephone OIl the parties' real estate office. She then re-recorded conversallons betwee!'l the husband and his alleged paramour, deleting all business conversa tions. She soughllo admit these tapes Into evidence In the P<lrties' di'JOfCe case, The husband 0bjected on the basis of the Best Evl, dence R.ule, state and federal

David 8. Byrne. Jr., is a Sfdchme oIll1e Un/versify 01 ~Ia

wm(l, where he received botll his wloorgr.lo'vilIC and Illw deBrees. He Is II member of Ihe Mon/gomery (Irm of Robison & Belscr and covers the criminill potlion of rhe doclsions.

,<5

wiretapping statu tes and lack of a prOper founda tion. The trial court sus tained the objcccion without stating the ground, The C(,l,Irt of civil appeals stated that the ground of the Best Evidence Rule was sufficient. The supreme court disagreed. However, the court concluded that the tapes were properly exduded llnder the federal wire tapping statute w hich exdudes tape recordings unless the Individual offari ns the t.. pes Is a party to the conversation or has the prior consent of a party to the conversa tion.

Insu rance . . . guest p assenger m ay no t recover un der b o th liability an d UM co .... erages o f host driver's p olicy w h en negligence of host caused acci dent

Sullivan v. St.lte Farm Mutual, 21 ABR 425t (August 14, 1987)- SulliV<\n was 3 passenger In an automobile inwlved in 11 one-vehide accident. The Cilr was (WIned by Jones and driven by Jones' son. Sullivan was seriously Injured and dl.lrI'1"ges exceeded the liabili ty limits. State Farm issued a policy 10 Jones provi ding both lIabltlty and un· dmlnsurcd/ul'lIMu red motorist coverage (UM). Stilte Farm filed this declaratory judg' ment 3Cl ion ilski ng the trial court to dedare that SuitivJn, the passenger, was not entitled to both liilbility and UM benefits. Under the terms of the State Farm policy, Sull wm was not the named Insured nor his spouse nor a re lative residing In his household nor a person USI!'lg the au tomobile with the consen t of the owner or his spouse. The State Farm policy "Iso provided that an uninsured motor vehicle does not include the vehicle insured under the Ii"biUty coverage. Sullivan millntilined thaI th is exclusion 'MlS in derogation of the UM stlltute lind therefore void and unenforceable as against public policy. The supreme court disagreed. The court statoo that the Alabama Uninsured Motorist statute does not mandate protection under the host driver's UM coverage when the cause of the accident is the negligence of the host driver. Rule against p erp et uit ies ••• pre-emptive rig ht of fint ref u sal dOCi n ot violate rul e

Robertson v. MurplW, 21 A8R 3529 (June 19, 1987l-Plalntlffs (J ther and the defendants had entered Into a partner· ship agreemen t which provided that upon the death of tiny pi.lrtner, the P{lrtnership did not terminate and the heirs of the deceased partner wou ld be bound by the terms of the agreement. The agreement also con tains a prCoemptlve right of first refusal, which gave the partnership a 9Ck1ay period in which to buy the in· teres t of llny partner deSiring to sell, Plaintiff wanted to sell and filed suit seeking to hiIVC the property of the part· nership sold. He did nol offer his interest 10 the P<l rtnership. The defend1lnts filed answers and motions for summary judgment pointing ou t the prt.>-emptlve righ t of first refusal. Plaintiff ar"gucd that the provision was Invalid because It viol ated the rule against perpe tuities and that It contained no reference to lives In being, i.e., it was for a period longer than 21 years. The ttiill COl,lrt disilgrecd and the supreme court affirmed. The supreme cout! reaSOMd that the

avowed object of the rule is to f<NOr commerce and the circulation of property by preven ting the right of absolu te disposi. tion (rom being tied up or restrained beyond a certain peri od. Pre-emptive rights, hOYle\lCr, do not restrain or prohibit alienilbility of propert y. Therefore, the rights are not CMlrary to the m.1i n objcct of the rule. Consequen tly, the preemp tive right of firs t refust.alls exempted frQm the Rule AgainSt Perpetuities. To rt .•. chiropracto rs do no t com e within th e pu rvi ew of Stction 6-54 82, et seq,

Baker v. McCorm<'Ck, 21 A8R 3793 (July 2, 19871- ln 1983, Baker wen! to M cCormeck, II chiropractor, to be treil ted for neck Pilln and head<lches. After treatment, Baker suffered a stroke and in June 1985, filed suit alleging negligence. The trial cout! granli!d dclendant's motion for summary judgmerlt on the grour\ds that the claim was barred by the one-year statute of limitations. Baker appealed, arguing that the apJ)(oprla te stiltute of limitations should be the two-year statute $et out In the Medical Liability Act, Section 6-5-482, et seq., Ala. Code 1975. The supmme court disag'et.>d and aff1rmcd the trial (ourt,

The supreme court noted thill Section 6-5·.m2, el seq., supra, Is limited to "any professional corporation or ilny person employed by physicians, dentists or hospitals who ar~ directl y invol'-«l In the delivery of health care services." M ceor· meek Is a chiropractor, He is not license(! to practice medicine or osteopathy In Alabama and is not a dentist. The legislature could have Included chiropractors in the coverage of the act if it had seen fi t to do so. l'lowever, the ieglslatu(e did not. Therefore, chiropractors are not 5u1>jccl to the two-ycar statute of limitations. Tort ... intentional inflicti on of emo tio nal d istress is an ac ti on on case Archie v. Enlerpr;se Hospit.ll and Nurs;ng Home, 21 ABR 3402 (June 5, 1987)-PJaintlff filed a l'M).(:Ount complain t and caplioned the counts " IntentiOnal InflictiOn of Emotional Distress" and "Tort of Outragoous Conduct." The defendan t flied a motion to dismiss the complaint based upon the one-year sta· tute of limitations. The de'endllnt maintained tha t these coun ts sta ted a cause of action of treslhlss on the case rather than trespass to the peoon. The trial court gr,mlec! the defendan t's motion. The plaintiff appcalcd and the supreme court affirmed. The supreme court reasoned tha t the test for determining whether a compl aint $tat(lS a cause Qf action fortresP<l5S or for trespass on the case is whether the tort was committed by direct application of fo rce or was accomplished indlr&tly. Under this analysis, the ton of intentional In(tjC1ion of emotional distress will come wi thin the provisions of Section 6-2·38(1), i.e" lln indi rect tresPilss on the ca~ class of tort. The impetus for recognition of this tort came from situations where there W ij$ nei ther physical injury, (i.e., no b;:Ittery or other tresPilSS) nor even an assault threa tening such injury. "'I~r, the deffondan t'S conduct was §O ou trageous and the emotional harm so severe tha t the common law tradition of allowlns new causes of action to provide a remedy for a wrong came into play,

Civil procedure , , • court may no t view propert y w ith o nly o ne part y's attorney Jones v. Henderson, 21 ABR 4302 (August 21, 1987)- Jones sued the Hen·

November 1987

dersons to restrain them from denying access to a rlght-of-way claimed by the plaintl((s. Several weeks after a hearing, the court vIsited the disputed pro~rty with the Hendersons' attorney, but without giving Jones' attorney notice or an opportunity to be present. After the view, the court denied the relief reqlrested I:rt Jones. Jones filed a motion for new trial alleging. Inter alJa, thm they were denied due process when the trial judge vi~ the property with the Hendersons, but without notice to their allorncy. The trlnl coun denied the motion and Jones (lied th l ~ appe(ll. The supreme coun reversed. The court swed that a trial coun must I>rovldc due process for each party before it. Due process mqulres that a party receive notice, a hearing according to that notice and a judgment entered In accordance therewith. The supreme court no\('(I thilt the court, in il non.jury case, may make a view, ilnd funher observed that there is no absolute requirement that the court 8i~ the parties notice it is going \0 view the property or afford them an opportunity 10 I:Jc present. However, the fundamental principles of due PrOcess require that I( the coun gi~s notice and an opportunity to be present to one par1y, the same notice and opportunity rllu st be given to the other party.

Recent Decisions of the

Supreme Court oC AlabamaCriminal

igencies of the situation made that course impefiltive Of otherwise "reasonable." The Alab .. rna Supreme Coun sought to distinguish "(!Xig!;!nt" dR;umstilnc;es from those circumstances which surround any murder scene. Judge Beatty's opinion quotes at length (rom Mincey Y. Arizona, 437 U,S, 38S (1976) and Thompson, supra , as follows: " .. . ~ unanimously rejected Ihe contenllon that orle of the exceptlorl s 10 lhe warrilnl clauSE is a 'murder scene exceptl(m: Although v.(l rIOted that I» lice may m~ke wJm.. ntl~s entries Oil premises whefl! 'they reasonably be1ItM! thaI a person within Is In need of Immediate aid; Id., at 437 U.S. 392, and that 'they make a prompt warr.1Ilt_ l!!!is search 01 Ihe area to 5I!f! if thell! are other victimsori( a killer is still on the premises; Ibid" we held that 'the murder scene exception' . .. Is Incon_ slstcn! with the Fourth and Founeenth Amendment ~that the warrantless selH( h of Mincey'S~Pil'lment w~ s nOt consthutlonally permissible simply because a homicide had recently oc· curred there." In the case sub judice, the police officers conducted a four-hour search of the premises "which Involved opening closets and chests o( drawers, and look-

In Memoriam

No "murder SCene exception" to the fourth amendment Ex Pdrte Ma'8le Lee Usrey, 21 ASR 2558 (March 27, 1987)-The SuprQme Court of Alabama, speaking through Justice Bea!!y, held that there was no murder scene exception to the warrant rt'!quirernent of th e Fourth Amendment. Justice Beatty, in an excellent opinion, s u~ the Fourth Amendment law from KaIZ Y. Un;led Srl)feS, 389 U.S, 347 (1967), to Thompson Y. !.ol/;Sillnil, 469 U,S, 17 (1984), The court held that searches Conducted outside the judicial process, without prior appr(l'.lall:rt a Judge or magistrate, are per se unreasonable under the Fourth Amclldment-subject only to a few speci fically established ;and well-dellneated exceptiorlS. The burden is upon those who seek ru<emption to prove that the el(. The

Alabama

Lawyer

t930· 1967 SPANN W. MtlNER Insuran<e SpeciaU5tj, tnc. Atlanta, CM'gia The Alabama Srare BM lind iu 8,400 memoors exrend to' hl~ IJrnily and ~no' cllIte$ 0 ... , sy m p~ lhy tn the untimely de,1th tlf 0... , Iller>d. Hi~ cQurascous flShl wirh ic... kemia ended at Houston's M.D. Anderson Hospital Octooo, 4, 1981.

ing under clothes and beds:' During the search, evidence was seized and phot().. graphs taken of the Interior of Ihe premises. Based upon the teachings of Mincey ilnd Thompson, the Alabama Supreme Coun remanded the case to the ,court of criminal appeals wilh the obser· vJtion " .. . the v<llidlty of the search and seizufe based on exigent circumstances is clearly and unquestlonnbly erroneous.."

Admission of lay testimony on a defendant 's sanity Ex Parte fohn Michael l.ee, 21 ABR 1853 ijanuilry 30, (987)- The Alabama Supreme Court reversed and remanded Lee's case On the ground that the trial coun abused Its discretion In denying Lee the right to have lay witnesses 8i~ their opinion on the question of his sanity or insanity. JUStice Be<ltty, writing /01 a unanimous court, held, "that in Alabama, a lay witness may give his opinion on the question of a defendant's ~nity or insanity as long as the proper predi Cilte has been I"id," Williams v. Stille, 291 Al a. 213, 279 So.2d 478 (1973); Lakas v. Stille, 434 So.2d 818 (Ala.Crlm.App. 1982) T(l lay iI proper predicate (or the admission of such an opinion, a witness fi rst must h~ testified: (1) to facls shO'Wlng that he had an adequate opportunity to observe the defendant'S conduct in general, and (2) to his l)Coonal obserwtion of specific irrational conduct of the dcfcndllnt. In making the determination as to whether the witness had an adequlllc op. ponunity to observe the defendant's conduct in order to render 1'1 15 opinion ad· missible, considerable latitude Is left to the sound legal discretion o( the trial COurt. In lEe's case, the testimony clearly shO'NCd that lee's counsel had laid II proper predicate (or the admission of Ihe officer's opinion as to whelh ~r l ee was InSM e, Failure to allow this opinion to be given constituted an abuse of discretion and reversible error, The right to explain 10 flight Ex Parte fames D<mald /.J)~, ABR 3670 Uuly la, 1987)- The supreme court, in a per curiam opinion, reversed and remanded lowe's case because he never was all<JYVed to present to the jury the cir· cumstances surrounding the Binningham Police Department's internal affai rs in.

347

vestlgallon. The court observed thnt the reason (or the defendant's flight was 11 question properly resef"\lCd (Or thc Jury after a consideration of all of the It!levant circumstances. The supreme COurt expressly rejected thc opinion o( the court of criminal appeal5 which h..ld held that the exelusion 01 the evidence did not prejudice the substantial rights of the defendant becau;e evidence of guilt was Hoo.'erwhelmlng:' The Supreme Court of Alabama obse~ critically: HFurthermol't'. tht! proper inquiry here Is no4 wheiIer the ('VIdence 0( the defendant'S lIulh Is oYerwhelmlnllDut. Instead. whelher a substanllal rlllhl 0( thedefendanl has or probably ha5 boon ~rsely affoctoo. The exclu510n d wi. denc!! ttlndlnlllO explain D night does adversely MICX-I a subslantlal rlllhl of II defendant ... o.oerwhclmlng t.... ldcncl'l of lIullt docs not wnder preJudlchl1error harmlen under Rule 45, ~I/lbllma Rule! 01 ~PJ}i!I~11t"! '>rocedure."

Juror misconduct- home experiments Ex Parte Bruce Lasley, 21 ABR 1980 (February 6, 198i)-Thc ddendant, lasley, was alleged to haYe Intentionally Injured Terrance and Troy Smith, agc three years and four years, by placing or holding them In sca'ding water until they were 5eVerely burned. At the time of the alleged assault, the defendant was living with Sharon Smith, mother of the victims. The defendant testified that he was giving the children a bath when he was distracted by a knock at the door. AccordIng to his t ~t imony, he returned to find the boys standing In scalding hot wa ter. The stale's case was ba~ entlrely on circumstantial evidence, The state's e>t-

pert, a pediatric surgeon, testiOed concern ing immel5ion burns, the spans of time during which immersion burns will OCCur at varying temperatures and the probabllltlM as to how such burns can be received In household bathtubs. The trial court, after the trial, disca.oered that three of Ihe jurors had condueled s.eparate home experiments in an attempt to test lhe defendanl'S theory of defense. The results of I'M) of these ex· perlments well! communicated to the other Jurors. One of the jurors also consulted a law book to aid her understandIng of cenolln legal terms and concepts. The supreme court, In reversing the corwictlon, held: "There Is 00 doubt that the home ex· perlmenl~ constituted juror mlscon· duct. The Orlly Question j~ whethClr thu mlscondu(t requires a new trl01. The standard for delermlng whether Juror misconduct «!quires a n(lW trial Is set rorth In Roan ~ Slate, 225 Ala. 426, 435, t43 So. 454, 1\60 {l932}. "The test of vltlallnglnfluencc Is not that II did Influence a member d the Jury to act with· out Ihe C"ldence, but that It might have unlOlWfully innu· encl!d that Juror and others with whom I"Iedellbm:ed, and m/8ht have unlawfully Influenced Its ~rdict I1!fldered.- (emphasis

"""",

J\ccordingly, the Roan test mandates r~rsal wilen juror miKonduct might have Influenced the ~rdi(t. This case casts a Htight burdenHon the defendant , Ex Parte Troha. 462 So 2d 953 (Ala. 1984) Finally, the supreme court observed that "the integrity of tnc factftndlng process is the hean and soul of our Judicial system. Judicial control of the jury's knowledge of the COIle is fundamental.

Forensic Meteorology & Oceanography NASH C. ROBERTS, J R. CONSULTANTS, lNC. ha. ovor 40 yeOfi experience In forensic motoorology ancI/orenslcocean· ography. We have a stalf of mature and experienced scientists w~h Impeo::obie credontllllsin an of the atmoapherlc and oce3llographicdiac.ipllnoa. Thea. nationally reoognlzed profoulonals ere cap3b!ool condUdlng Involved Inv8"igetiona, reconstructing weather and merr ....e conditions ...nywhere In the world, and .r. eminently qualified to appear in 8xpol11estlmony.

Air Quali ty •• Water Q uality·· Hydrology 1()4() North R.Dl'art SI.

348

New Oricans. LA 70116

(504) 58 1. 16811

Our rules o( evidence are designed, so far as humanly possible, to produce the truth and to exclude from the Jury those facts and objects which lend to prejudice and confuse. Evidence presented must be subject to cross~xaminat ion and rebuttal. The defendant's consti tutional figh ts of confron tation , of cross· examination and of counsel are at stake.... Prosecutor's comment on defendant's silence Ex P,lIIe Freddie Lee Wiley. 21 A6R ]875 Uuly 10, (987)-W1ley was convict· ed o( murder and sentenced to ]0 years Imprisonment. Prior \0 trial, Ihl:.' coun gtilnted the defC.'lldant's motion In limine prohibiting reference In any manner to Ihe defendant's assertion of his consti tutional right to remilln sllenl. The defendant objccted to the following testimony clicHed from an MIll~ tl n8 officer IJi the prosecutor. Q, Old he give you any expl;lnatlon 115\0 why, or .. , A. '!los' sir, He St.lted that I"Ie undetstood hiS rights, and bc1"0A.' he g<M.' any $talemtlm, he wished lor his liI'N)'l'r 10 be p~t , and he dki 001 want to sign anything.

The supreme court, In a per curIam decision, held that the trial court committed error when it stated: ~U, if he like! defend,)!..1didn't gI..e II statement, ~ I'm go,nll to grant "jOUr motion for a mlwlal. l(he did, I'm 8OInlllO tislen to lhecllCumstances wrro..mdlng it. (t!mpliasis addoo) The law Is clear that a person may assen his constitutional rights at any time. He may answer queSlions if he wishes, but he may stop at any time. Miranda v. AriZona, 384 U.S. 436 (1966) It was cr· ror for the trial court to conclude in substance thllt when the defendllnt waives his righ t to remain si lent by making a statement to the pollee at the scene of Ihe crime, he could not rec1;tim the right to remain silent at the police station and keep that asscnion from being used against him in court. The wpreme court held, ''The defendant's constitutional right to remain silent was violated by the State's Inquiry at tdal about the defend· ant's assertion of that right, The constitu· tlonal violation was aggr.wated by the trial court's statement about the effect of the defendant ever makins a statement against his interest." • November 1987

Local Bar Associations And Presidents The fOIl(JINlr'lg IS;) list of the local bars in Alaooma th at have presidents and the presidents' and executive directors' (where apl)licable) office addresses and telephone numbers. If you havc any Information concerning local bars (by county or dr-

cult) not listed, please send It to Tile Alabama Lawyer. Au laugil County Bar James T. Bachelor 1',0.

Bo~

Coffee Counly Bar L Merrill Shirley

&14

341 North Court

PrJ.wllle, Al 36067

Elba, "L 36323 891·5""5 Colbert (ounly aar Gone M. ~1llJ'T'by, Jr. P.o. Box 326

361.1033 8.\ldwi n County Bar

Samuel N. Crosby

P.O. Box 1109 Bay Ml nelte, AL 36507 937·2417 Barbour/Bullock Coullt y Bar Lynn Robertson Jackson P.O. BOK 10 CliJY!on, AL 36016 775·3506 8e5semer Bar Arthu r Green, Jr. P.O. Box 60S Bessemer, AL 350;1 1 42404090 81rmlngham Bar William C. Kn ight 3000 SouthTrust Tower Birmingham, AL 35203 251·3000 Beth Carmichael, executive dir..:.'t';\Or 109 North 20th Street Second Floor Birmingham, Al ]5203 251-8006 811)unt Count y Bar Michael E. Criswell P.O. Box 785 O noorlta, AL ]5121 466-3333 Butler County Bar It'Wis S. Hamilton P.O. Dra'Ntlr 9 Croonvllle, AI. 36037 362·3372 Calhouo/Cleburne County B;lr jen)' B. Oglesby P.o. Box 1849 Anniston, Al 36202 2]7·6611 Chambers County Bar Joe l G. Holley P.O. DriMl" 606 Lanett, AI. 3686] 664-6623 Chil ton Coulltl' Oar John M. Hi ggins fJ;0. Drawer 769 Clanton, AL 35045 755-4242 CI ~y Count y au Anhur t , ~t~rdegrcc, Jr. P,O. Box 67 Ashland, AL 36251 354·2176 The Alabama Lawyer

Sheffield, AL 35660 383-6797 COO~ Cou nty 8ar Roben I. Teel, Jr. P.O. Bo~ 245 I(ockford, AL 35136 377·4957 Covington County Bar Francis M. James, III P.o. SOK 1061 Andalusia, AL 36420 222·1051 Cullman County Blir Juliet G, 51. john 402 9th 5treet, 5.E. Culiman. Al 35055 734·3542 Dale County BIl' Roben H. Brogden f'.o. Orawl':r 906 OzOtk, AL 36360 774·5m Dalln County Bar johrl W. Kelly, III P.O. Box 103 Selma, AL 36701 675-5770 Elmore Count r B;'ir Lynne Rtdd e-Thl"(lYv'C' P.o. Box 160 \Nlltumpila. AL 36092 567·6488 Escambia County Bar EYCrtll1C A. Price P.O. 80x 616 Brewton, AL 36427 867·62;12 Etowah COUlltv Bar Benny l. Robert~ 634 Chestnut Street Gadsden. Al 35901 547·8093 Ceneva Count y Bar Henry F. 1.J!e, III P.o. Box 297 Ceneva. At 36340 6811·6406 H ou~to n Cou nty Baf EdwMd M. Price P.O. Dril'Nl!f 2228 Dothan, Al 36301 793·2424 HuntJivllle-Madlson County Oar Douglas C. Martinson

1'.0. Drawer N Huntsville, AL 35604

533-1666 '.ckson Counl y Bar Wall ace W, HafillSon P.O. U<»I 246

Scousboro, AL 35768 259·6655 Lamar County Bar L. E. Gosa p.o. Box 648 \t!rnon. AL 35592 695-7158 lauderdale County Bar Ral ph M. YounS 109 N. Court Street Florence, AL 35630 76;t7411 Llwrcncc County Dar Roderick M. AIeK3nder P.o. BOM 312 Moulton, AL 35650 344-1744 Lee Coun ty Bar Andrl!W ). Gentry, Jr. P.O. Box 2071 Auburn, AL 36630-20n 62104941 Limestone Count y 8ar Dan Totten P.O. Box 729 Athens, Al 35611 232·1267 Macon Count ~ Oar Mil ton C. Davis 304 North Main 5treet Tuskcgcc, At 36083 727~500

Ma rengol5umtcr/Grttnc Courlty 83r Wililom T. Coplin p.o. BOK 967 Demopolis, AL 36732 289·3880 Marion County Oar jllmes K. DaviS P.O. BOK 157 Hllmll t()f1, AL 15570 921·7878 M3rihalt Coun ty Bar Ceorg,e M. 8amen P.O. Box 91 Gun tcf5ville, Al 35976 562.()133 Mob ile Bar Ma rshall DcMouy p.o. Box 290 Mobile, AL 36601 432-6751

Bilrbaril Rhode!, ditilCtot

P.O.

Dr~wef

~cc:uti\o'U

2005

Mobile, III 36652 433·9790 MOnroto/Conecuh COulUy Bar Mickey IAbmble 1'.0, BOlt 725 Monroeville, AL 36460 575-7241 MOIll",Omtty COilnty 8M Edwin K. Llvlnglton 30 South Perry Street Montllomery, AL 36104-3799 834·3656 Dot Wilson, e~ec:u t lve director 138 Adams Mnue Mont80~ry, AL 36104 265·4793 Morgan Coun ty Bar Bingham O. Etlwards 211 l(.oc Strt.>et, N.E., Stc. A Decatur, AL 35601 35].6321 Pike County Bar Alien C. JOnes 78 NOtih Court Square Tray, AL 36081 566-3605 Russell Coulll y Bar Kenneth E. Davis P.o. Box 939 Phenix Ci ty, AL 36667 296-6026 Shelby County Sar COnrad M. Fowler, Jr. p.o. Box 567 Columbiana,l\l35051 669·6763 SI. C I~lr County B~r Donald R. Hamlin 1900 Cogswell Avenue Ptlll City, AL 35125 884-1876 Ta lladega County Bar Bill Thompson 406 E. North Stn!(!( Talfadllg:l, AL 35160 362·B341 lUKaloou County BIlr W. Cameron Parsons 1'.0. lIox 65 ThsclllooSll, Al 35402 345-5564 Walker COunty h r Margaret Horrls O(lbbs P,O. Box 3256 Jasper, AL 35502·3256 221-1740

349

Young Lawyers' Section ,,

uring the first week In Au· gU$I, the American Bar Association held Its annual meeting In San Francisco. The Alabama Young lawyers' Section was represented at the Young Lawyers' Di· vision Assembly by a full delegation of voting delegates. Young lawyers representing Alabama as vollng deleg,ltes were Oilire A. Block; Charles R. Mixon, Jr.; W. Percy 8adham, III; J. Terrell McElheny; laura l . Crum; and John A. Plunk. Those dclCSiltes represented Alabama In a vcry positive manner. II Ii moSI Imporlant that we are represemcd al YlO functions so the concerns of Alnbama young lawyers can be expressed to lhe organiz.... tion representing the nation's young lawyers. This year also was the time for election of a district representative to represent Alabama and Georgia to the eKecutlve coundl of the ABA·YLO. I was honored to be selected as a District 10 representaTive and will serve In this position for the ncxttwo years. Wi th our iflcreaslnglnvolvemen t ln ABA-Yl D aClivlties, Ills an oplXlnune time for those of you who would like to panldpate in YlO activities to let me know. If you havc ilny issues you feel should be addressed by the YLD affecting yOU'lg lawyers or the profession In general, let me know and I will di scuss with you the methods of ex· pressing your positions to the YlD.

Elceculive Committee meeting On AuguSl29, 1987, this year's YLS Executive Committee held its first

350

" meeting ilt the Stillwilters Reson on lake Manin. The purposes of the meetIng were to acquaint the new members of the executive commi ttee wI th those who served last year, or· g.1nil.e the execUTive committee, receIve prelimInary reports frOm the vilrious subcommIttees regarding their plans for the upcoming year, solldt input from the executive commlll(!(! members on various projects and generally sel the course and lone for the upcoming year. Mnny of our committees already are under way toward this year's projects. The faU bar admissions ceremony, coordinated by laura Crum, was held October 19, 1987. Tom Hemn and Taylor Flowers have agreed to serve as liaisons between the ~ta te YlS and local Young lawycrs' sections. We want \0 build the network of support among Our Young lawyer a,fflliates throughout the stile as well as Inltime new groups and revitalize those which no longer mcct on a regular basis. I cncourage those young lawyers Interostoo In organizing an ilffi llate to contact me. J will send a member of the cxecutive commillee to meet wi th you at an or· ganlzatlOnal meeting and provide suppon to your group.

Constitution bicentennia l activi· tics In celebration of the bicentennial of the Uni ted Stales Constitution, the YlS Executive Commi ttee decided to dlSlribute materials, produced by other young Iilwyers throughoUT the

Charles R. M ixon

VlS President

country, In our local communities. The Texas Young Lawyers' Association, In connection whh the A8A·

VLD, produced a videotape and discussion guide entitled "Forgollen Freedoms." The vidootape and p~ gram are thoughl.provokin& aimed at acquainting the viewer with several

concepts embraced by the 9ill of Rights. These programs are being distributed to high school civics teachers In several Alabama ci ties

with the hope that the students and teachers will firld these rTI..1terialslo be helpful In their uodcr5tandlng of our Constitution. In an attempt to spread morc InformaUon concerning the Constitution,

the Alabama Younglawycrs also distributed an audio cassctte tape, consisling of 24 one-minute segments on the Constitution arid our founding fathers. This tape, produced by the los Angeles County Bar Association Barristers, Is being distributed In sev· crOll Alabama communities for broad· cas t as public service announcements. The goal of this prOject Is to increase public awareness and educa· tion concerning the bicentennial celebration. •

November 1987

Legislative Wrap-up by Robert l. McCurley, Jr.

The Alabama Law Institute has completed a two-year study of Ihe fraudulent Iro1ns(er law in Alabama, Richard Ogle of Birm nsham selWd as chairman of the commlnee and I}rofessor V. Nathaniel Hansford of the University of Alabama Scl100l of Law was the reporter. The following Is the commentary written by Professor Hansford to Ihe proposed draft: The nrstleeislatlve response 10 (radulen! cOrM:ly.lnce W<lS the Statute of Elizabeth, which Partianlenl passed In 1570.

The statute was directed against cooveyances made with tne purpose and Intel'll "10 delay. hinder, or defraud" creditors or purchasers. Most AmeriC<ln jurisdidlons passed legislation copied from Ihe English model or considered the English aCls pan of tho COmmon I(IW re<:elved by the colonies. In the course of lime, h()W(.....-er, the 13W of frau -

dulCl'lt

COn~nces

became extremely confused and dl路

verslfled as courts responded to the cases before them. In Older to clarify and simplify the existing law 00 the subject. Ihe Nallonal Conference of Commissioners 00 Uniform laws decided In 1915 \0 draft a uniform aCI govcrning fraudulent COi'l'\.'eyimCes. In 1916 the Conference ')J)pra.芦! the Uniform Fr.ludulcnt ConYe'f<lnce Act (UFCA.lln Its final form and. subsequently. 25 SIMes and the Virgb\ 1$I"nd5 adopted it.

haluation of Alabama fraudulanl Transfer Act and present Alabama law The new Alabama Fr.ludulent Transfer Acl (AFTA), like Its prede<eSSQr the UFo.., does I'IOt attempt to state the entire body 01 fraud\rlent conveyance law bur leaves to the courts the 'Ml/k of fleshing out the particulars. This section provides a general (ompmison of the AFTA and current Alabama law al fraudulent conveyance to highlight the change that lhe AFTA would make on this stilre's ICIW. First, some general observations about the AFTA should be noted. The AFTA, like most comprehensive legislation, vvould simplify the case taw of fraudulent conveyance In Alabama. The aCl gives conci se definitions for important terms such liS"dillm," "creditor" and "debtor," and states In detail when a debtor makes a transfer or Incurs an obligation. A problem with this state's presenllaw is that the courts have developed il in a "spotty" fashion; there are

The Alabama Lawyer

gaps where uncertainty still exists. The AFTA would flll many of these gaps. The next general observation aboul the effect of the AFTA Is that It 'NOUld make Alabama law uniform with many other states' 1iJ'N'j on fraudulent tr.. ns(ers and Atllbama law would be compatible with the Bankruptcy Code provisions dealing with this area of the law. Substantial value exists In having the AI"bama law mesh with the taws of other jurisdictions becau$@, by Iheir very nalure, fradulen l conveyances alten take place across slate lines. A debtor hiding his property naturally will attempt to confuse martl!rs as much as poSSible, and the debtor often u~ Interstate transfers to COYer the trail. Uniformity of ItlW allows a creditOr more eilsily to r over thll I)roperty the debtor has conveyed outside his state. The Bankruptcy Code of 1978 grants the INstee in bankruptcy the poYIer to aYOid fraudulent tran sfcrl made within one ~ar before the date al the filing of the petition In b;lnkrUlltcy, and the Code defines a fraudulent convcyal\Ce In the same terms as sections 4 and 5 01 AFTA. Moreover, the AFTA defines many of its terms with language derived from the Bnnknrptcy Code. Other plOYlSlons in the AFTA, although they do not use the same language as the Bankruptcy Code, Incorporate the Code concel>ts. Section J of the AFTA, In liS definition of value, adopts language from lhe Bankruptcy Code. The concept In AFTA

Roben L. McCutkJy, Jr. Is too d,,9CIO( 01 1M AAtbama I.aw Institute at the UnivOrsily 01 Alabama. He received rII! undergraduate ancllaw dagrass from the University.

351

section 6, concerning when a transfer occurs, relies !leih·lly on bankruptcy principles. Portlonj of section 8, which outline the defenses, liability and protec· tlon afforded a transferee from a debtor, orl81nate In bankruptcy law. The compelling point I, that this compatibility with bankruptcy law makes the application of the law more just and uniform, since ( redltors and debtors will be treated alike when bankrUI)tcy occurs and the debtor is not wi thin the jurlsdlc. tlon of the bankruptcy court. Further· more, state court s can beller protect creditors from unscrupulous debtors under the AFTA. The Alabama Fraudulent Transfer .A.cl would hiM:! a lIgnlncant effect on the substanUve Iav.· of fraudulent convey{lnces of the stal!!. First, It would broaden Ihe notion of a fr.ludulent conveyance and Include transfers which Alabama courtS previously have not categorized as

Don't let your Alabama Lawyers get worn, torn or thrown away. Order a binder (or two!) at $6.50 each from: The

Alabama Lawyer P.O. Box 41 56 Montgomery, Al 36101

or call (205) 269·1515

352

fraudulent. Al though the AFTA retains the (oocepts of aCtual fraud and COfIStructlye fraud, Ihey are broader concepts th{ln those In Alabama law. The AFTA defines actuill fraud generally In the same temu as the Curr<!n! Alal).,m{ll.,...., so thaI In both conlexts actual Inlenl to defraud Is a requirement. The AFTA, however, also Identifies a list of factors the court may consider In det:er· mining the debtor's actual lnlent; in other words, Ihe AFTA lists badges of fraud that aid In provln8 actual!ntcnt. This list of circumstances of fraud eKlmnds the operations of actual fraud to co.-er transfers not presently included within actual fraud. In Alabama, presently the most common Instance of fraud Is Inadequate consideration, and the AFTA Indudes this factOr In liS list. The AFTA Indudes 11 badges of act un I fraud. Although the AFTA li st contains the traditional common-law badge of fraud, It also includes those less commonly recognized. This eKpansion and expliCit recognition of the usual badges of fraud by legislative act v.ould increase the number of Irans:ers cred itors could a\lack as actual fraud and would make actu{ll fraud easier to prove, Perhaps Ihe most significant Impact of thc "FTA would be In the area 01 con· struct l~ fraud. The essential element of a constrlKllyely fradulent transfer is inadequate consideration. tf the <lebw makes a voluntary transfer or a transfer of propeny for less than Its value, a creditor may attack Ihe tra"sfet, regard. less of actual inlenl 10 defraud. The

GENERAL COUN SEL The Alabilma Stale Bar now is acceptin8 applkOllions by I(!tter wi th resume from qualifed I~rs for the I>osilion of Ceneral Counsel. These should be addressed 10 Chairman, Selection Committee, P.O. BOI( 671, Montgomery, Alabama 36 101 . This position requires an cKpcrien(ed lawyer wilh a stfOn8 professional background. Salary commensurate with experience and maturity. The Alab.,ma Statl! Bar Is an C(lual oppor· tunity employer.

Alabama courts have held thai Ihe insel· of tnc debtor is nol an Issue in avoiding a transfer on the ground of consl ructi ~ fraud. Constructive fraud under the AFTA Is different from the present Alllbilma law. The nnandal condition of the debtor is an elemenl of the cause of action. Sec· tlon 4(c) requires that tv.o elements exist before Inc transfer Is voidable for conSltuc!lye fraud. The debtor must transfer the property for less than a reasonable equiva lent value and the debtor muSI be in a prCCilrlol.JS Onanclll i condition. AFTA rectlon 5 identiOes a similar form of cons tructively fradulent transfers and requires rwo elements similar to those required in section 4: the tlansfer must be for less tll .. n a reasonably equivalent value and the debtor must be Insolvent. Add1tlonally, section 5 prohibits as con StruClI~ly fraudulent another type of transfer that present Alabama law does not consider fraudulent. Under Alabama law, a preference bv a debtor, regardless of who the transferee is, is valid. An Alabama debtor may f<M)r any one of his credi tors over another as long as the I)ropcrty Irlln$f(!rred to the crt.'<Iitor is equivalent to the debt. The AFTA C<lI'VlO'S out one type of preference for treatment as a fraudulent conveyance. St."CIiOn 5 brands a transfer by a debtor as fraudulent if the debtor made the transfer to an insider for an antecedent debt and Ihe debtor was inselyent at the time. Thus, this Sl:leClal type t:A preferertCe is voidable under Ihe AFTA outside of the bankrupt. cy conlCK\. The effect of the AFTA on the principle of constructive fraud v.,,:)uld be to limit Its area 01 operatlon In some situations and expand It In others. The AFTXs ilddltJon of Ihe new element of the debtor's financial condilion would remove from conSlru ctl~ly fraudulent conveyances those t ransfe~ in which the nnan· dally sound debtor transfen property for less than full value. A creditor could avoid these kinds of transfers only if he pr'(NCS actual fraudulent intCf1t. ~rse II', a creditor could attack preferences to reilltl~s or other InsldelS outside Ihe jurisdiction of the bankrUI)tcy court. The AFTA illsa would change thc cur· rent Alabama distinction ber.vecn the rights of eKisting clOd subsequent credi· to~. The rights of eKisting credi tors v.()uld remain the same; Ihe rl8hts of ~ncy

November 1987

future creditors would be broadened. Generally, In Alabama an existing creditor can attack a transfer for actual fraud or constructi...e fraud, and a future creditor can anao: only a transfer that involvcs actual fraud. The AFTA allOW§ an existing or subsequent creditor to attack transfers made with actual intent to defraud , It also ~ II(M/$ bolh types of creditors 10 attack some constructively fractulenttransfers, i.e" transfers made for less than a reasonably equivalent Villue while the debtor is eng.1ged In a business with remaining assets unreasonably small In relation to the transaction, Or while lhe deblor intended or believed he would InCur debts be-,Qnd his ability to pay. Only an existing creditor may ilYOld the kind of con5tructl'o1a fraud Identified in section 5. Futu'(l creditors may not at. tack preferences to Insiders and transfers for less than adequate consideration while the debtor is insolvent. One area of confusion In the existing "Iabama law is the right of the creditor 10 f'i!COV(!r on the debtor's property once the dcbtor'stransferee has recon~ the property. Provisions of the AFT" cover Ihls area, Whenever a creditOr obtains a judgment on a cI~lm alY,lnstthe debtor, he may levy on the assets In the h.lnds 01 debtor's transferee or the proceeds the transferee retained from any conveyance of the asset to another person. Ellisting "labam3 law is siient on the right of the credi tor to seek satisfaction from procc(.'d s, FurlhermOn), 3 Cil5e haS never bet!n presented to the Alabama appellate courts thtl! offers the courts the oppor· tunity to confront Ihe question of the right of a purchaser from the debtor's

transferee. AFTA section 8 states that a creditor may recover the debtor's asset from the debtor'~ transferee and from any subsequent transferee other than a good faith Irans/ere(! who took for value. Thus, the AFTA protects a good faith purchaser and forces the creditor 10 pursue the procet.>ds of the purchase thaI remain in the possessioo of the debto(s transferee. The "FT", like the curfCOt Alabama law, protects a good failh \lansteffie from the debtor to the extent that he Save value for the debtor's property. St'Cflon 8(d) ~ <Iulres the transferee who is not Inyolved In the debtor'S fraud 10 return that part of the debtor's prOperty (or which he did not gi'o1a value. Finally, section 9 01 the AFT" does 001 follow the suggested Yatute 01 limitations I)rmid(.>d in Ihe UFTA. The statute of limi.

\ations Is drafted so il will conform to the existing Alabama law on extingUishment of claims, Section 9, AFTA, addresses both limitations on claims for fradulent transfe r of real and personal property. In summtlry, the A l ab~ma Fradulent Transfer Act is not a mere restatement o( the present law of Alabama on ffiludulent COlMlYances; the new aCI, If cnacted in Alabama, would bring major changes to the liJW in this area, In gcneral, the AFT" codifies an area of the law that cannOt be neatly packaged, It broadens Ihe creditors' powers to pursue a debtor's assets and also rerTl(1o'6S some of the OYerIy technical requirements of the current law, The ..... FTA has considerable value because ollis effor1s to achieve uniformity bctv.-een jurisdictions and compatibility with the Bankruptcy Code, •

Richard Wilson & Associates Registered Professional Co urt Reporters 17 Mildred Street Montgomery, Alabama 36104

264-6433 The Alabama LaWYl'f

353

Riding the Circuits ~

_ _ _ _ _ _ _ _ _ _ _ _ _ _~~ _ _ _ _ _ _J

Baldwin Coullty Bar Assoclalio n omcers: bdck row, leI/ 10 righI, Samuel N . Crosby, presidenl; Mollie P. /ohl1$fo n, s芦:.rct:JryllfOOsurcr; N. ',bung Dempsey. III, vice-president; John Earle Chilson, bar commissioner . fronl raw: Jolin Ch/l5011,

Sr. , first prcsdenr. Baldwin County 8M Association; /.8. Blackburn, firsf bar commissioner, Baldwin Coomy Bar A5soclarion.

Baldwin Cuunty Ba r Associatio n

The Baldwin County Bar Association celebr<1tes its 40th anniversary Ihls year. The organization came into existence shortly afler leglslallon was

enacted on 1\u8u ~1 16, 1947, establishIng Baldwin County as Ihe 28th Ju-

dicial Circuil. AI the ney,tly-formed association'. earliest meetings, J.B. alackburn was elcc!Lod the first repre路 sentative to the Alabama State 8M

Board of Bar Commissioners and John

Chason was elected the first president. In 1967, Pl'rfliis Nesbit served as the fillt woman president of the association.

354

During its 40-vear history, the El4ldwin County Bar has endorsed numerous measures to Impr'OYe the local court system and sponsored such programs as the hiStOric Baldwin County term of the Alabama Supreme Court held NO'Yember 2t, 1986. This year the association Ii Instituting a mediation program for the peaceful fewlution of disputes outside the court system. Also, each monthly meeting includes a program o{ continuing legal ud ucallon {or ImprOYement o{ pro/csslonal skills, In areas such as workers' compensation, mortgage law, civil arKi criminal trial practice, appellate ad'KICacy, talC plan-

nlng. family law, oil and gas Iww and empIO't'-rnent I........ -Mollie P. Johnston

Covington County Bar Association The COYlngton County Bar Assocla. tion recently elected new ofllcers. They are: President: Francis M James, ttl, Andalusia Vice-president: Ashtey M. Me路 !Cathen. AndalusIa Secretaryllreasu~r. flr.mk McGuirt!. til, O,~

The association entertained its members and spouses at the lake home 01 Abner Pov.<ell. Ill, In AugUSt

Novcmoor 1987

Houston County Bar Associalion

Marshall County Bar Association

The new Houston County Bar Assocl:uion officel"5, as of September 19, are as follows:

The newl.,..elected Marshall County Bar Association's officers are: President: Qorge M. Barnen,

President: Edwald M, Price, Jr.. Dothan Vice-president: Randy C. Brackin, Dothan

Treasurer: Eugene Pilul Spencer, II, Dothan Sec~ary : Banks T. Smith, Dothan

Huntsville-Madison County Bar Association AI the August meeting of the Huntsville-Madison County Bar AsS(). dation, the following were elected officers for this ofganh.:ation: Prnsldenl: Oou810' C. Martln!IOfl,

Huntsville

Vice-president: Roben Sellers Smith, Hunl!ville

Secretary: P.lul P"te, Huntwille Tre.lsurtf: Susan Tuggle. Huntsville

Guntersville Vice-president: F. nmolhy Riley, Albertville

Secretarynreasurer. T. J.

UlrrlC!l,

AlberTI/llle

Sumler, Greene and Marengo Counties Bar A$soclat ion The 17th JudiCial Ci rcuit bar Association sponSOted a continuing legal education progr.1m held In LIn. den, Alabama, August 19, 1987. Ap. proKlmately 50 attorneys from the first, fourth and 17th Judicial Circuit bar associations attended the progmm and the re<:eption that fo llOVv'Cd at lhe Unden Country Club. After Introductions by Drayton Pruitt, Nathaniel Hansford, acting dean of the University of Alabama School of Law, opened the program with an uJ)dille on the law school, proYidlng infonmuion 00 the curront

freshman class, the 'acuity, the Alabama law Institute and the Law School Endowment Professor Charles Gamble, former dean of the University of Alabama 5<:hool of Law and author of thc revised editionS of McE/roy'$ A/lloomll Evidence, was the featured speaker. ProfCisor Gamble's topic was '~ Ia bama Evidence: A Comprehensive Pcrspectlvc.~ During his presentation, Gamble presented his first attempt at providing a chart which, once It Is fu lly developed, will give the practicing lawyer a comprehcnslYl! picture of the entire body of evidence law as It has evolved in Alabama. At thl" dose of the program, Joe c. Camp and David M . Hilll, both memo 001'5 of the 17th Judicial Circuit Bar Association, were honored for 50 years of service to their local and slate bar associations. (See biographical skf.'tches in /his issue's "Bar Briefs" section.)

•

ALABAMA BAR INSTITUTE FOR CONTINUING LEGAL EDUCATION November and December 1987 Programs NOVEMBER 12 12 13 19 19 19

20 20

Farm Bankruptcies Under Chapter 12 (Satellite) .. . .... • •... 4.6 Civil Procedure •••.•••......................••. •• ••... 6.3 Civil Procedure •••• • •••.•... . ... ...... . ... ...•.•.••... 6.3 Generation Skipping. Planning and Drafting (Salelllle) ....... 4.6 Damages . .. . ..... .......................•........ .. . 6.8 Civil Procedure (Video replay) .... . . .. • ......• . ..... .... 6.3 Damages ........... . ... . . , .. .... . .• . •.•...... . ...... 6.8 Civil Procedure (Video replay) . ...... .. . .. ..•. ......... . 6.3

UA Law Center Montgomery Civic Center Birmingham Civic Center UA Law Canter Birmingham Civic Center Dothan, Sheraton Montgomery Civic Center Sheffield, Holiday Inn

DECEMBER 3 3 4 10 10 11 16 17 18

Banking Law and Pracl lce (SalaIlUe) ..•••••••....•••... . . 4.6 Bankruptcy Law ..•......••••.... . . .. ...........•••••. 6.9 Estate Planning •.•......•••••............ . .....•••..• 6.6 Employee Benellts In Corporate Transactions after Tax Reform (Satellite) ..... . ... .... .. . .............. 4.6 Winning Jury Trials ................................... 7.4 Winning Jury Trials ..•...•........ . .......•••••••.••.. 7.4 Civil Procedure (VIdeo replay) ............... , . .... .. ... 6.3 Negotiation and Settlement .•....... . .••...... .. ........ 7.5 Negotiation and Settlement ........... . .....••• .. .. . .. .. 7.5

The Alabama Lawyer

UA Law Cenlar Birm ingham Civic Center Birm ingham . Harbert Ctr. UA Law Center Blrm lnghEim Civic Cenler Montgomery Civic Center UA Law Center Mobile, Riverview Pleza Birmingham, Harbert Ctr.

355

Book ~ Review Alabama Civil Practice Forms by Allen Windsor Howell. The Michie Co., Charlottesvi lle, VA, pp. 563

Reviewei:l by Greg Ward Few weeks go by when I do not open

I h3\.1! not found a beller single-volume book In which a ncwattorney should Invest. Instead or having 10 draft each docu-

my milll and ftnd il new offer for a set of

ment (rom scratch, H()YVCII gives an ex-

form books, not Just a set of form books, bu t lhe se t of forf'll books, gener,llly p\rrporting to be the last set of form books I will ~r h(lYe to buy on that subject. Of course, this rarely-if ever-turns oul to be the case. And, often as not, those tha t are purchased are a disappointment.

cellent point of beginn ing. Not only ore the forms good, but law notes are also

N ot that t underestimate the need for forms-on the Con tr(lry, they <Ire referred to around tne sta te in terms sucn as "cookbooks" or "ret:ipes." Thl.')' (Ire filcts of modern practice and a f'1!!cessity that no lawyer can ~ fford to be without for much longer. The real problem lies In ftndlng such books tnat ~re w ritten with a specific jurisdiction In mind . Finillly, someone has written a book whi ch attempts to tall or-make civil forms on Alabama law for the general Pf1lClilioner. Allen Wind sor Howell, a member o( the Alab..lmil bar, has structured Alabama Civil Practice Forms ro that It Is one of the best books thc attorney Invol\lCd in a general civil practice can hove at his or hcr fingertips. It Includes neody 400 forms coverlng a broad arrilY of dvil motters. There are ten chapters! general damilge actions; action5 against governmentill en tities; eqllitable claims: probate court proceedings; domestic relations; eKe<;uti on, levy ilnd gMnishment; business organizations; teal estate tran sacti ons; wills and trusts; and miscellaneous o th er forms.

356

included. The notes afe nol extensiveIn (act, they general ly are very $hol1-

bUllhey are helpful in Jogglnglhe memory lind giving a quick referen ce point. In light of the paucity of ilVilitablHty of

modem forms on the subject, the chapler on probate court procl'e:Hngs Is especial. Iy helpful. In this soolon alone there Is

a colleclion of nearly 70 forms dealing with subjCCl5 as diverse as adult gUilrdi. M ships, adoptions and administration of estates. Each section Is subdivided, ror example, the section on adult guardiansh!ps Is subdivided into th e petition of Inquisition, orner setting heilring, tranScript and in~truct i(m~ te) Jury, oa th of Jury and jury verdict, as well as ali others needed for a si mple guardianship (16 In

Alabama Civil Practice Forms fulfills another need for an Increasing number of lawyers. With the rapid expar\slon of the number of word processors In use around the stale, It Is an e~cell cnt source for sctting up a forms file in a word processor-a teal time-saver, and one which can transla te Into dollilr savings. Of eourse, as the author points ou t in the book's preface, forms are not meant to be used with ou t the nt)(;essary alteril!lons 10 make them fit ~~ific cases. They are not a panacea for th e attorney who does not check th e sta tutes and cases, bUI these arc among the mOSt uselul materials I have SCM. And, Judging from the reactions I have heard, this seems to be consensu~ opinion. I'lowell does not (ill the book wi th much law, Thai 15 not his goal. W hilt he docs Is put an excellent slngl(>-'.1)lume civil form book at your disposal- a task hcrcto(or~ gone begging.

all).

â&#x20AC;˘

Greg Ward is 11 graduate of Auburn University and the University of Alabama School of law. He Is in private practice in laneU, Alabama, alld serves on the editorial board of The Alabama Lawyer.

November 1987

Opinions of the General Counsel by Holly l. Wiseman, Acting Assistant General Counsel

QUESTION,

$umers Council, Inc., 425 U.s, 748 (1976); Bates v. Slate Bar of ArIzona, 433 U.S. 350 (1977) "Our firm Is contemplating the preparallon of a firm reIn the case of Marrer of Nalion;J/ Service Corpotarlon, sume for sons. friends, e..istlng dlents and prospective supra, the Fifth Circuit Court of Appeals attempted to empIOYee5, as weU as other persons. Including prospKlivt distinguish an example of "pure speech" (rom "commercial clients. who may inquire about the firm . In the rKumi! we speech." A plumbing company had con tracted for outdoor plan 10 Include statements de5CribinH the eKperlence of the billboard ad~rtl s lng, then flied bankruptcy before it could (lrm In specific areas of practice. We will nOI, however, b@ pay (or the billboards. Tne billboard company proposed to camparln", the quality of those seO'ices lo those offered by display the following message on bi llboards reserved by the other law firms. plumbing company: "Beware, this company does not pay its "Does such a resume constllule advertising under Ternbills." The Fifth Circuit noted that the message \ViiS not a por.uy Disciplinary Rule 2·102 and therefore require the solicitation for the sale or purchase of a product or service disc l.limer sel forth in subsection (E) of tha i rulel" and that It did not constitute a "mere advertisement" since ANSWER: it was not published by one whose profit Interests wt~ SCI\'Cd Temporary Disciplinary Rule 2·102(E) requires thai, ~ No Il')I the view espoused. The court also noted that the message communica tion concerning it 1~r'5 services shall be '0'135 "nOlln the form of a paid advertisemenl.~ The court held published or broadcast unless it contains In legible andlor that this message constituted pure speech and coold not be audible language the follO'Ning: 'No representation is made enjoined by the bankruptcy COUrt as harassment d the debtOf. about the quality of the legal services to be performed or the The landmark case of Bales v. Stale 811r of AriwM extend· elCl>ertise of the IDWycr performing such services:" As your 00 the Ilmlwd First Amendment protection, accorded to com· proposed nrm resume will Include Information rcg.1rding the merclal speech, to advertising by hmyers. SubSC<llKmtly, the services provided by your nrm, It must Include the disclaimer Supreme Court has appl'O'.'l:!d some regulation of lawyer adver· as set out in DR 2·102(E), tising by oor associations, Most pertinently, In the recent case d Zauderer v. Office of Disciplinary Counsel of rhe Supreme DISCUSSION: Court of Ohio, lOS S, Ct, 2265 (1985), the Supreme Court Temporary OR 2-I02(E) requires thilt statements regarding agreed Ihat "warnings or disclaimers Imay) be aPPlOpriately a I~r's services must be accompanied by a disclaimer. This required ... In order to dissipate the possibility of consumer provision Is authOflzed by holdings of the United States confusion ordecept ion~ citing In re R.MJ" 45S U.S. at 201. Supreme Court which permit certain limited state regula tion The Code of Professional Responsibility 0( the Alabama 0( so-called "commercial speecht as opposed to "pure speech;' which is accorded full First AmendmCYI t protection. Stal e Bar corresponds exactly to the U.S. Supreme Court "Commercial speech" has been described by the United holdings rt!!wding lawyer ad~rti slng, Temporary DR 2-101 States Supreme Court as communication "relmed solely to prohibits only communlcollions concerning a lawyer'S services the economic ImefCst of the speaker and Its audience" or which arc false or misleading. Temporary DR 2·102 requires speech "which docs no more than I)fopose a commercial that any "communlcmlon concerning a Iawyt!r's services" shall transaction," Central Hudson Cas v. Public Service Commis- conlaln the folla,yln8 disclaimer: ~No representation Is made sion of New 'Itlrk, 447 U.S. 557 (1980); Malter of National about the quality of the legal services to be performed or the Service Co,po'~t1on, 742 Fed. 2d 659 (5th Clr. 1984). Com· expertise of the lawyer performln8 such services." The mercial speech may be forbidden and regulated in situations Alabama Supreme Court has upheld this disclaimer requirewhere so-called pure speech may not be, Supersign of Boca ment in the case of Mezrano v. A/abam.'l SUIre 8al, 434 So. Ralon, Inc. v, City of Ft. /..auderddle, 766 Fed. 2d 1528 (11th 2d 732 (Ala. 1983), Clr. 1985). Nevettheless. "Truthful ad~r1islng relating to liM'ful The proposed firm resume ciearly con tains communlca· activities i$ entitled to the protections o( the First Amend- tions concerning a lawyer's services. It Is appropriately ment!' Virginia Boord of Ph,lfmacy v. Virginia Cillzens Con- regulated as "commercial speech~ because it rela tes to the

The Alabama Lawyer

357

economic interests of the firm of propo~

ed rl:.>(ipient s of the resume. The Infor· malion contained In the resume dearly Is Intended to solicit the sale of the firm'S services. Prepar;l\ion of Ihe resume obviously will be paid for by the law firm. (tnd it will Ix! cirCul<J.led to those who might be inclined or induced to engage the law firm's services. Under previous opinions Issued Uy this olnce. direct mali· Ings of such brochures 'NOuld conslilute permissible adverti sing rather than Impermissible Usollclta tlon" as prohibited by Temporary DR 2·103 [R0-86-49] . They must, however, contain the Temporary DR 2·102 disclaimer. Those preparing tile resume aiM) should review Temporary DR 2-104 regarding "Com munication of Fields of Practk e" and Temporary DR 2-112 regarding ':.\dvcrtl~lng of eerll/lca· tion." Those rull!5 forbid claims of specialization except in certain narrCM'ly limited circumstances. •

Pictured above are, left 10 righI, Ray Ferraro, president of The Florida Bar and host for the 1987 Southern Conference of Bar PreslOOnts, held in Palm Beach, Florida; Ben Harris, preslden! of the Alabama Siale Bar; and Reg8ie /-Iamllel, eJ!eculive dlreclor of the bar. Harris and Hamner arc holding a memento of th eir visit, wh ich coincided with the Alab':Hna-Florida football game In Blrminshnm. PresidcllI Ferraro Is a 8fadunlc of the Unll'Ns/ty of Florida. .

Back to Birmingham in 1988

1988 Alabama State Bar Annual Meeting July 21 , 22,23 at the

Wynfrey Hotel, Riverchase Galleria, Birmingham, Alabama -education -entertai nment - i nspi ration

356

November 1987

Poor-moulhers

Consultant's Corner The follCI'NinS Is a reviC'N of and com· mcnt.lry on an offlce automation issue wl!h curren! impofUlnce 10 the legitl community, prepared by the office automallon consu/tan! 10 Ihe stale bar, Paul Bomstein, whose views are not llf!Ces-

51lrily those of the Slale bar. This is the fifth .rlicle In OUf "ConSu/«1nt's Corner" series. \IVe would like 10 hear from you, bOfh In c,itique of rhe arricle w,lUcn and suggestions oflaplcs for fuwre articles.

Just 5.1y No The compuler industry continues to undergo a 5lgnifiC4Int Sh(lke-up, and ((!w(!r companies seem destined to ~ make It," al teasTln their present form. Virtuallv all v<!ndors are turning 10 a strategy called

"verUca l marketing:' This means, among olher things, Ihal almost everyone claims 10 be an expert In the legal field. albeit they were In the wholesale beverage distribution business three weeks ago. This raises an interesting dilemma: - Many firms do h~ pressing needs for truly e(fecli-..e regar-specific systems, such as document production, time and billing. practice management, ctc. - There arc hordes of vendors, who claim to have "revo lutionary" t~hn ology.

- How to choosel There are she types of -..endors r would never buy anything from, regardless of their representiltlons. Guilt-mongers

These arc among the most desperate of ...:ndors, but the easiest to detect. They

The .... Iabama Lawyer

give themselves away immediately with such rehearsed phrases as, "You mean you are not Interested In the bestrN"You h<M:l' CYerything you needr "How do)OO knO'W we are nOt the bestir you will nol let us make a presenlationr' "You are So'llisOcd with what you htwer" Do not filII for the "reasoned response" technique. They will eat you alive. Just say no, (and hang u~hrow them out). Oa rga in-hawkers Do not misinterpret this one. There are legitimate bargains to be had and you should pursue them, but only I( you would have bought the product/service al the regularly offen:<! price. If It was not a good value at ils regular price, il was not a flOOd vi:lfue. Think of the cardinal rule of the marketplace: ~ Demand con. Irols price Ask yourself, "If this is such a good deal, why Is It so chea!>?" A sure clue 10 a producl's true value Is whether It ever sold for a non-discounted price. How to handle hawkersl JUSI say n ~

Oad·mouthers II may take a bit longer to pick up 00 this type of Yendor. He is the qulmesscnUal hustler: "That's yesterday's technology." "You mean you like that!" "HaYen't you read what Bubba's Videoworld is Silying ilboullheml" After a kw mi nules you realize that you ha...: heard nothing aboul this vendor's product, on· Iy what is wrong with ~ryone else's. Polnling out comparative dIfferences betwecn one product and another is an elhlc.,1 (and e({ective) sales technique provided It involves more than mere competitor bashing. Ask youself whal this vendor's angle really is. Answer your own qucstioo with the (n()N) classic "Just

--:'

These are kin to the Bad·mouthers, but a bit more prone to elicit sympathy from a Ul'IWo1ry buyer. "I am just Ihree doors dcr.vn the stlt!Ct." "\M:luldn't )Ou rother do business with a local firm?" " I know you from Elks, don'l II" "Hey, why not give me a break!" "My wife W.1) your greataunt's flower girl. This gets a bit sticky, C\IeO more so if your great-ilun! Is sti ll alive. Nooctheless. you shou,d not be unduly smyed by such crao.en appeals. What if the poor soul Is unable to meet the agreed requirements! Are you going to sue your great-aunt's fl()Y,(!( girl's husband? Is not your practice enough of a hurden without thlsl Just SOl.- _ _ . N

Hip-shoolers

They are i;tst, you hiMlto concede that. No maUer the question an anSv..'Cr Is forthcoming in millisecondl. Ask about business hiSlory and )00 are likely to get "Hislory! .. 111storyl ... \o\k!'re making it a~ v.-e speak'" How about legal.specific word processlngl "We got Iii" Table of Citations! "lAbn the Kentutky Derby in '81, si red an '86 winner, 'tlble of Authorities." What about acce5S 10 Lexis or V\btlawl "Eastlaw, Wesdaw, If they're OUI there we're compatible with 'em." ThaI should do it. If it does nOI, try anOlher question, any questioo, then ... just

'--_. Nole-Iakers These people can really drlYC you nuts. They are so nice, yet they mllke '1'0\' wish you had taken up catnsh farming instead of law. An indelible clue 15 Ihe poi sed pen. These l)OOr souls are hired by a sleazy -..endor 10 canvass law Orms (at $)36 per hour) on behalf of "the closet.' Their questions will drive you up Ihe wall. "Oh, that sounds so exciting'" 'What does a litigator dol· "00 briefs come in colorsr' You get the picture. Just

•

3S9

MeLE News

July commission meeting At Its July IS, 1987, meeting conducted In Mobile, Alabama, the MCLE Commission conducted the follOWing business: 1. \A)tcd to recommend to the ell· (!cutive committee and tne president that Commissioner Phillip Adams of Opelika be chosen cnairman of the MCLE Commission for 1987·88; 2. \-bted to recommend tne fol lowing commissioners to tnc nominating commince as new MClECommission members: George W. Royer, Jr., J. Mason Davis, Brooll C. Holmes and James R. Seale; 3. Denied a request for ClE credit for writing a chapteroi a textbook to be used In graduate, Internship and postgraduate college courses In forensic psychology; 4. Ruled thaI the govcrnor's legal advisor and assistant legill advisor are el'gl. ble for Rule 2.C.l exemptions from the ClE requirement;

Me lE News by Mary Lyn Pike AsslSlant hec:utive Director

elE compliance due The deadUne for earning 1967 conti-

nul081e8al educallon credits Is December 31, 1987. A calendar of e lE oppor-

tunities is printed elsewhere In this issue, If you wish to attend II program not listed, call or write the MelE Commission at

slate bar hC(ldquarters.

elE transcripts Until 1987, the Me lE Commission did nOI require cou's!! sponsors 10 submit registration or allendance lists, but re-

qulroo bar members

maintain their

oYin rt!(;ords of course attendance. Our·

S. Appl'OYCd retroactively tnree 1986 Pfogrilms submitted after the Marcn 1, 1987, apPro.'al deadline, on the condition Ihe sponsors be Informed again of the necessity (or complying wi th the commission's requirements;

6. Allowed an a.ttorney to amend his 1986 ClE report aftEr the Marcn I, 198i', amendment deadline, on thc condition that the il!torney not milke such requests In the future; i'. Approved a seminar on contrOlling conlrile! disputes, designed for both I~rs and professionals In conStruction and arbitration (American Arbitration Association); 8. App~ 9 5emlnar on legal issues and the handicapped, designed for lawyers, school superintendents and s ~lal education coordinators (Alabama Department of Education);

Ing 1986, the commission adopted Regulallon '4.1.15. requiring sponsors 10 submit registration lists 50 ClE transcripts could be compile(! (or bar nlembcrs.

This month, a transcript will be gcn-

erated and mailed 10 each member of the bar 65 years of 38C and yo unger. It will replace tne blue and wnlte fOrm used CM:!r Ine previous five years and is being mailed two montns laler Inan In year! paSI so Ine anendance record will be as complete a~ P05>ible.

360

CORRECTION; In tne September 198i' Issue of the Lawyer, on page 282 (ilnnual meeting hignlights), Windell Ovvens of Monroeville was Ilstl'(! Incorrectly as Edward 80sv.oell o( Geneva. The Alabama Lawyer regrets any Inconvenience thi$ may have caused Mr. o.vcns or Mr. 80sv.oell .

9. ApptOYl!d a sem in~ r on open network archltl'Cture designed for anomeys. utility executl~, vendors. lobl:ryoists, manufacturers and telecommunication users (Telecom Publishing Group);

10. Denied the Eastern Mlnerill Law Foundation's request (or apprCNed spon. SOr status becau5e the ors;.nlutlon does not limit its membership to allol'Of¥ and lIS educational effons a-e not directed specifically to attorneys; 11. Cr,l nted approved sponsor statu s to the National Association of Allorneys General; and 12. Granted appra.oed sponsor status to the Continuing legal EduCation S<itellite Network but excluded from presumpti-...e apPrtwal broadcasts to law fi rm s. Law fi rms wishing to receive credit for such broadcasts will be required to apply for approval of them In accord ance with Regulation 4.1.14 on in·house seminars.

September commission meeting At Its September 25, 1987, meeting in Montgomery, the MClE Commission conducted Ihe following bU5Ines~:

I. Recognized and welcomed nC'N members: Commissioners Broo)( C. t-tolmes, James R. Seale, ~ Mason OJ\lis and Goorse w. R~r, Jr.,

1987

Alabama Bar Directories $15 P.O. Box 4156 Montgomery, Al 36101

NO~'embe,

1987

2. Added a second paragraph to Regulation 5.1, as follQ\.YS: Any reports received tytJ January 31, or the next business day If January 31 Is a Saturday or Sunday, will be considered Ilmeiv OIed. All others must be accompanied by a fifty-($SO) dollar late filing fee In the form of a che<:k made payable to the Alabama State Bar. Reports not SO ac· companied wil l be returned 10 the attorneys filing '1em and those attor· neys will be deemed not In compll· ance until the lee Is paid.

3. Adol)led new Regulation 6.A.l, as follQ\.YS: Any deficiency plan recelllCd by the Alabama Statc Bar after January 31, or the next business day If J3nuary 31 is a Saturday or Sunday, shall not be accepled and the sanctions sel forth In Rule 6.B. shall apply. 4. ApprOYed proposed wording or the 3nlcrldment of Regulation 3.6, previous. IV approved: The number of hours required means Ihat Ihe attorney muSI actu· ally attend t'oYelve (12) Instructional hours of CLE pel year with no credit given for introductory remarks. meal brt:!aks or business meetings. An in· structional hour will In all events con tain at least six ty (60) minutes.

S. ApplU'oEd proposed wording for new Regulation 3.1.0, previously apprOYed: Any btlr member earning twenry.five (2S) or more credits in a givcn year, excluding credits brought (orward from thc pr'i!Vloos year and teachi ng credits earned, shall qualify (or a conUnulng legal education recognl. tlon award.

11 . Denied approv;ll of a labor relations symposium because it was designed primarily fOr nonl~rs (Corlstangy, Brooks and Sm ith);

17. Declined 10 app/'O'v'l! a bankruptcy seminar because the sponsor failed to submit It (or advance approval, a(ter beIng Informed that the commission would accept no additional retroactive applica. tlons (Creditors UJw CeOler); 18. Approved twO 1987 pfOgtJmS on hospltJllaw but ruled that no additional retroactive applications (rom the sponsor would be accepted (American Academy of Hospital Altorneys); 19. \k)led to amend Regulation 3.S, effective January 1, 1988, to the effect that teachers wilo do not prepare handouts will receive no eKtra credit but, ra ther, will be limited to credi t fOI actual time spent on slage; 20. Tabled consideration of the recom· mendatlon of the Ethics Education Com· mlttee Ihat such eductllion should be mandated, to be considered at the com· mission's November meeting. •

12. Tabled a requ~t for 1'IccreditMion of a seminar designed (or attorneys and doctors pending review of handouts prl" pared fOr the seminar (Ntoblle Bar Association);

SENTENCING ALTERNATIVE PLANNING

6. ApprCM.>d a permanel1l program o( substitute compliance for a bar member on the basis o( physical disability;

7. Denied a request (Of' teaching credi t (or Judging of a mock trial competition;

moo

9. Wilived the $SO 1''IIe filing (ee (or another auorney who filed a similar affidavit; 10. Granted appf'OYt."'(/ sponsor status to the Federal Energv Bar Association and the National Institute of Municipal Law Officers;

13. Declined to appl'Q'.1! a seminar on dealing responslblV with the chemicalIV dependenl (Huntsville Interagency Council on Chemical Dependency); 14. ApPrOYed for full credit in part and half ctedl t ln pdrt a ~minaron the utilization of legal aSsiSla1t$ (Montgomery Courl ty Bar ASSOCiation); I S. ApprOYed for half credi t a federal law o({jce management seminar (U.s.

Our Oeloll'o Pro·Sonlel'\Ca Investlgatlonl : • Carry I. vor. bla weight III the l entencIng decillona 01 85~ ol Iheludgel who leld them • Minlmi,e potenllil poll-convlclton prOblem. al nc:orporlla Inllc:lpaled chlngn In l.dl r. l ..a nl a ncl ng plec:tlcal .Incllloe a lentenclng recOlllmenoalioll and, when epproprlate. Illa rn lllv.1 to Incarcel. Uoo

Equal Employment Opponunitv Com· miSSion);

Sentenci ng and Parol e Conau Itants

16. AI)PI'O'.Ul in pan and denied In part a cor\(ercrlce for legal executives (Can· lor and Company, Inc.);

1987 Alabama State Bar Directories $15 Call 269-1515 or write: P.O. Box 4156 Montgomery, AL 36101

The .Alabama Lawyer

,In

8. Wilived the $50 late fili ng (ee for attorney who an affidavit attesting to the faci that he had mailed his 1986 CLE roport to the MCLE Commission twice during the month of January 1987;

710

N~tlon.1 Log,l Sit ... Ic.. LI~e VIow Avonus. Au'OI •. GA

30308

C.II now: 1·800·2 41 ·00eS

SMITH-ALSOBROOK & ASSOC. EXPERT WITNESS SERVICES

• T1rec:ontulUng • RlnVtlre eKpIoeIona • Traffic: ac:cldenl reconatruc;tion

~ .

BOSSY O. SMITH. B.S.• J.~ .• ,""lld.1I1 P.O. BOlt 30&4 O""lIkl. AL W03 (205)

'."ts.. 361

Disciplinary Report Suspension • On Seplember 15, 1987, the Supreme Court of the State of Alabama entered a final order suspending Tuskegee anOfney Calvin D. Blgge" from the practice of liM' (or a period of 91

dllYS. without automatic reinstatement. Biggers pleaded gull· ty 10 scvcrnl charges alleglng1ha! he had neglected his clients' legal business. [ASB Nos. 86-443, 86-517, 86-520, 86-609, 86-624 & 87-31)

Public Censures • On July 15, 1987, Mobile I~r Wilson M. Hawkins, Jr., was publicly censured for conduct a(!versely reflecting on hi s fitness 10 prattlee law, for willful neglect of a legal matter entrusted 10 him and for Intentional failure to carry out a COn-

Iract of employment with a client. Hawkins was retained by an out-of·state client In July 1986, and accepted a $250 fee

10 Investigate a reported attempt to re-zone certain coastal pr0perty In AlabaMa Ihal was located near propeny <Wined by the client. After having received no communication from Hawkins, and after numerous unsuccessful attempts to can· tact Hawkins bf tctephorlc, the client flied a complaint with the bar in October 1966. Thereafter, Hawkins ignored the request of the Grievilnce Committee of the Mobile Bilr Associa· tlon that he prcwide iI response to the client's complaint. (ASB No. 86-666) • On July 15, 1987, Montgomery lawyer Elno A. Smith, Jr., was publicly censured for willfully neglecting a legal matter entrusted to him, and Imemionally failing 10 seck the lawful objectives of a client through reasonably available means, in violation of DR 6-101(A) and OR 7·\0I(A)(1) of the Code of Profess/onal ResptJIIslbllily of the Alabama State Bar. Smith was the attorney of record for a cllel'lt appealing iI criminal canvietion to the Alabama Coun 01 Criminal Appeals, but failed to file a brief on behalf of the client, even after being notified by Ihe court that the appellate brief had not bet.>n filed ilnd was ~rdue. Smith .. Iso ignored two requests from the Montgomery County lJar Association Grievance Committee to pravide an cxplanOltion for his failure to me a brief 01'1 oohalf of his client. [ASO No. 83-522)

Private Reprimands • On July 15, 1987, a lawyer was privately reprimanded for willful neglect and intentional failure to seek the lawful objectives of a client through reason ..bly avail .. ble means. The lawyer was appointed by the court to represent an Indigent convlet on appeal, but did not flIe a timely ..ppellate brief. After being notified bf the clerk of the appellate court of his f"i lure

362

to flIe iI brief, the lawyer flied a pro forma ~no merit" brief, though the record on appeal contained the basis for several legitimate arguments of fC'o'erslble error. IAS8 No. 84-698] • On July 15, 1987, a lawyer was privately reprimanded for engaging In conductth.!! adversely refleeted on his fitness to practice law. The conduct essentially amou r~ lt'd to con tri· butlng to the delinquency of a 15 or l6-year..old minor, by allowing the minor to spend considerable time at the lawyer's residence, and making alcohol available for the minor's use. [NiB No. 85-48J • On July 15, 1987, a lawyer was privately reprimanded for having viol,lIed DiSCiplinary Rules 2·111(A.)(2) and 2·111(8)(2). The lawyer flied a suit on behalf of a client, and was subsequently discharged by the client. HOYJeVer, the lawyer did not flIe a withdrawal in the suit, and did not dellwr to the client all of the papers In his possesSion to which the client was en· titled. lASS No. 86-121] • On July 15, 1987, a lawyer was privately repfimanded for willful neglect, Intentional failure to seek !he lawful 0bjectives of a client and Intentionally prejudicing or damaging a client. The lawyer 0100 a suit on behalf of the clienT, and subsequently failed to comply with the trial court's order that the pleildings be amended to add additional necenary par. ties. The failure to amend resulted In the action being dismissed, with cost5taxed against the lawyer's client.IAS8 No. 86-716J • On September 25, 1987, a lawyer was privately reprimanded for conduct i1dversely reflecting on his fitness to practice law, groo.'o'ing out of his failure to appear at the scheduled time before the bo"rd of b..1r commissioners for a private reprlmand In another matter. lASs No. 86-730] • On September 25, 1987, a lawyer was privately ~i· manded for having willfully neglected a Icg.al matter entrusted to him, and having intentiOnally ("iled to seek the lawful objooives of a client through reasonably available means. The lawyer agreed to represent a clienl in seeking damages arisIng from fraudulent rel>rcsenta tions thilt hild been made to the clien t In connection with the purchase of a house. The lawyer, hOYJeVer, failed TO file suit on the client's behalf prior to the expiration of the statutory period of lim itations. [AS8 No. 86-394(8)] • On September 25, 1987, a lawyer was priV<ltely reprimanded for having violated DR 9·101(A). The lawyer, a former judge, sal as the judge on a divorce case, and several subsequent modifiCilTlon proceedings. Afler leaving the bench and entering the practice of law, the lawyer then Inltia!t.>d another modlncatlon proceeding. concerning child support,

NO'fflmber 1987

1987

as a\,orney for the former wife, against the former husband, [ASS No. 85·08] • On September 2S an Alabama attorney received a prlv.ne reprimand (or violation of DiSCiplinary Rules 5·105(A), 7-101(,4.)(1) and 7·101(A)(2) 0( the Code of Professional Respon. sibllity. The Disciplinary Commission found that the attorney had been retained to represent an estate in a will con tcs!. 1m· mediately prior to a trial on the matter the attorney advised the executor of the estate that he previously had represented the con testant and had advised Iht;! con testant on a It;!sal matter directly related to the contest itself. Furthermore tke attorney advised that he t'KpeCled to be called as a witness by the conteSlam. The Disciplinary Commission determined that Ihe at. torney's conduct was such that he wa s engaged In a si tuation Ih;'ll would likely Involve hln, In representing differ ing Interests, and that he failed to seek Ihe lawful obJecll-..es of his client and failed 10 carry out a con tract 0( employment as required by the Rules. [ASB No. 85·387] • On September 2S, 1987, a lawyer was priVillely reprimanded for willfully neglecting a legal mattcr entruSted to him. He accepted a retainer to represem a clien t in appealing a civil case, bllt did nOI flIe a timely brief. The appeal wa s dismissed by the appellate court, bUI the lawyer took no actlon to have It relnslawd, and did not ( 1)prlse the client of the dismissal. [AS8 No. 86-485(8)1

ALABAMA STATE BAR DIRECTORIES $15.00 Call 269-1515 or write P.O. Box 4156 Montgomery. AL 36101

•

b P.

·M

UNITED COMPANIES LIFE INSURANCE CO.

REALLY GOOD NEWS Here's 8 lender maki ng 20 year loans with FIXED interest rale8. Not variable. FIXED FOR 20 YEARS Commercial - Investmenlloans. Ilrsl mortgages.

Prop. rUM: Office buildings. shopping cenlers. lIghllndu8trlal. New construction. rehab. properties. or existing buildings. Bank.,.: We can provide Forward Commitments, up to one year In advance. for permanenlloans to cover your construction loans. United Companies Is Phone: (205) 1179·0367

The .... /abama lawyer

oil

one-billio n dollilr.

fi n il nc~ 1

company listed o n NAS DAQ.

J. Michael Shield. Southcrtll Bldg., Sulle 201 1025 Montgomery Highway Binnln8hilm, AL 35216

363

Memorials ber that he was responsible for the landmark deci sion handed dOY.'n by the U,S, Supreme Court In the case of Boykin v. AI{lbilma, In whlc;h the Court SCI Out criteria to be met for a judge to accept a guilty plea. He worked actively w th the youlh of Mobile as 11 IIttlc! league coach and through Ihe Boy Scouts of America, and was active in community afr"lrs. Gibbons Is surviYed I1i his wife, Betty W, Gibbons; a daughter, Doria Desiax Gibbons; Iv.o sons, John Duroc Gibbons and Thomas Jefferson Lannes Gibbons; and other relatl\.(!$.

l ohn Edmund Adams-Grove Hill

Mmicted : 1919 Died: September 9, 1987

John Thomas Andrt\\oS, Jr.-Birmingham Admitted; 19&4 Dlt!d : July 6. 1967 Robert WOlrner Dick- Montgomery Admi tted: 1974 Died; August 24, 1987 Peter A. 0 1 Rito-Baltlmol'e, Maryland Admitted : 1945 Died: December 17, 1986 W. Herbert Osborn e-Birmingham

Admitted: 19)0 Died: September 6, 1967

Forrest lee Treanor, Jr.- Ultlelon, Colorado Admitted: 1974 Died: May 28. 1987

These notices are publi shed Immediately after reports of death arc received . Biographicalln(ormatiOO not (lppearing

in this issue will be published at 11 lalCr date j( information Is accC!Ssible. \M! ask you to promptly rCp(lrt the death of lin AI;'Il)arn" aHorney to the Alabamil SUite

Bar, and WI:! \oVOuld appreciate your assist· ance In pl'OYid lng blographlcallnformal ion (or The Alabama Lawyer.

( . 1( \It \\1 (.111111 ) ......

On June 13, 196', E. Graham Gibbons died. He was a member of lhe Mobile Bar Associalion, Alabama Stale Bar and American Bar Association, Gibbons was born in ~rnon, Ala· bama, N~mbcr 11, 1925, the son of James B. Gibbons and Anne Walsh Gibbons. He was educated in the public schools of Tuscaloosa, Alabama. and received his Ll.B. degree in 1951 (rom the University of A13OOm3. Gibbons served in the United Slales Army Air Force (rom 1943 to 1946 and was a Wilis! gunner on a B·29 In Ihe South PaCific durins \r\brld War U. He was recalled 10 active dUlY during the Korean Confli Ct and served fro m 1951 Ihrough 1954 as a lieutenant in the Judge Adlo'OCates Office, In 1957, he came 10 live in Mobile, AI"bama, and taught history and civics at Barton Academy for three years; he entered the practiceo( law In Mobile In 1961 and thereafter conllnued as an ac· tlve and successful trial law~r until his death. Many members of Ihe bar will recall Graham's readiness 10 handle indigent cases without pay and also will remem-

11\\,111 \\

' I OtlO\

Daniel W. MollOy', Jr., was born in Birmingham, Alabama. January 10, 1949, and lived most of his life In nearby Sulll·

\ 364

November 19B7

(

gem, Alabama. He died March 22, 1987, In Mobile at the age of 38, Molloy graduated from the University of Alabama in 19n with a B.S. degree, re<:eived his law degree in 1976 from th e Uni~i(y 0( Alabama 5<:hool of Law and was admitted to practice that same year. H e fi rs l came 10 Mobile as director of Ihe Legal Aid Society of Mobile, serving Ihere for four yeal'$. He then was a member of I h~ lilW firm of Haais and Molloy. j'le Is survived by his wife, Melina M olloy, and two children, a son, Jason, 16, and a daughter, Kate, seven.

Stolle was born in Mobile, Alabama, on January 11, 1911, the son of George Edwin StQne and Claudia Kirkpatrick Stone. He graduated from the public schools of Mobile and fater from the University of AI;Jb(lm(l and the University of Ala· bama Law School, where he rocei...oo his Ll.B. degree In 1935. He was a member oflhe Phi Delli) Thet;! (lnd Phi Del t.a Phi fraternities. On luly 15, 1935, he began practicing In Mobile and In 19B5 received a 5~fIf certifica te from the Mobile Bar Assocla· tlon In recognition of his halkentury of active pr;!ctice. From 1939 until 1951, he represented Mobile County In the AI(lb(lm(l House of Representatives, serving with di stinction in that position. For many years, he served as attorney for the City of Prich(lrd and for the Prichard Water Works and S(l'.'.'er Board. He con cluded his .legal career In Mobile as hOllsc counsel for tile M obile County School Board. He also served as a member of many leading civic associa tions, Including the Rowy Club, and worked diligently with Con tact Helpline. He was a member of various other civic, mystic and social organizations, and wa s a past presiden t of the M obile Bar Association. At the time of his death he wll S a member of All Saints Episcopal Church.

•

On April 25, 1987, George Edwin Stone, Jr., a member of the Mobile Bar Association and the Alabama State 8ar, died and the MQbi le Bar Associatio n recognizes and rnemorallzes 1'1 15 outst,lnding record as a prominent attorney, d istinguished d ti ~e n and honored civic leader.

CORRE CTION : In the September issue of The Alabama Lawyer, the noti ces of deaths of AI(lbitm(l I~f$ Incorrectly In· cluded William Borden Strickland of Birmingham. William Bo rden Strickland, of M obile, is still an acti'te member of the Alabama State 8ar. The editors regret any inconvenience \hls caused, Due to this mistake, no longer will The Alao.lma Lawycr publi sh obituaries from Ihe Bureau of Vital Statisti cs, nor will we take ar'ly information Oller the telephone. Tile memorial information must CtlMe from a spouse, law partnerlco-worker or the local bar of which the deceased was a member, and this m~terlal must be In writing, w i th name, return address and telephone number.

COU RSE M ATERI A LS AVAILABLE $12.50 per set U pdate '87: Recenl Deve lo pments in the Law To picsTori Reform '117: Its O(.'\IClopnlent llnd O utcome; the Role o f th e Bilr William D. Scruggs, Jr. Fort Payne, Alabama T he Prac t ica l Impil cl o f Tori Reform . , . , . , O n Defense Prilctice lawrence 8. Clark Birmin!:lham, Alabama ... O n Plaintiff Pract ice

Ernest C. Hornsby Tallassee, Alabama Ethi cs: A Summary of Recent Disciplinar y Act ions, Changes in Ihe Rul es of Co nduc t Go ve rn i ng Atto rn eys Gary C. Huckaby Huntsvi lle, Alabama TaK Reform: Wh at Ever y Practi tio ner ShlJuld "now L.B. Feld Birmingham, Alabama Recent Oe<:lsl ons of Ille A labama Supreme Court Civil o.ses Stephen D. Heninger Birmingham, Alabama Cri minal C" ses David B. Byrne, Ir. Mont!:lomery, Alabama M arital law Update: Ch ild Custod y and Visitation Robert F. Prince TU SCJ loos a, AlilbamJ Insurance Pra(.1ic::e !X.'Vt,..Jopmt...,ts: SuIJ. rogation, Bad Faith, Co"en'flloyee SUits Plaintiff's Perspec tive M. Clay Al spaugh Birmingham, Alabam a Defendant's PersPC( ti ve Bert S. Nenles M obi le, Al abilmil OllCr 700 attorneys p..lt1icipmed in this recent seminllr, Sl)I)nwrecl by Ihe Young lilwyer~' Section, and most rated these m(lleriills <1$ excellent. Here is your op!>ortunity to purcha se Ihfl fllBt<!rials If you were unable to attend. Pleose send il check, made PiIY'" able to Ihe Alabama StJIe Bar, 10: Seminar A lilbama St.l te Bar P.O. Bt)x 671 Monillomery, A l 36 101 •

a...._Ior.....-_ .......... .....,.

Classified Notices

1WlS._ ..... 1,......, .... 1eI> _ .. "'" _ ,. ., , ... " ... ,.... ~ UI pol' _ III (501_ ..... , UCI pot oddiIIonol "","" C\OI~n.d UIfIo' 0IId ,......,.... ""'"

... 00<"""" . -........ kIIKJwinoIlI'II>4loNnt ><:McAAtl 100 'II _ 0.11 ... - . l7 No ....... _

_~ ... ", .. 0 • '''''''' "",,"'~""_Il

.100 ........ $0000I clooolloll COf/'t'" ~ _

.... 10''''-''' ' - oo:_~a..- dt ......... 1a<oI<

1'0. ..... . 15t, " - Al lotlOl

FOR SALE fOR SALE: USt:O LAW BOOKS Ala-

bama Rcl)()rts/Appellate Reports, Alabama Code, South~rn RCIXlrtcr 1st & 2d, Southern Digest and more. SAVE 3()' &0"" 'Ale buy, sell & trade. LAW BOOK

.\ PrOCedure, Am Jur 2d, ALR, ALR2d, AlRJd, ALR4\h th/'OOgh \blume 38, AlR2d Later Case Service, AlR Blue Book of Supplemental Decisions, U,S. Supreme Court Reports. Contact Joe Calvin, P.O. BOk 1963, DecalUr, Ala· bama 35602. Phone (205) l5J..V"s41.

EXCHANGE (800) 325·6012 P.O. Box

24990, Jackwnvllle, Florida 32741· 4990. FOR SALE: Landtech 86 Real Estate Set·

Ilement System DeSigned For IBM PC, Xl AT & PS/2. Complete iI closing witn. in 20 minutes, Prepares "IUD Pages 1 and 2, Buyers and Sellers Closing Statements, ~1I Disbursement StatementS and Checks. Reg. Z APRs and Am ortizat ion $(hedulcs. PROGRAM FEATURES: Inl~ralC!d \o\brd Processor

allows preparation of Commilments, Policies, Notes, Affidavits & others.

Forms GenerJlor (or preparing FNMA, VA, FHA, arld other pre-printed forms. Complete EscroN Accounting for up to 15 bank accounts. Cross Reference System permits you to look up clOSing files 23 different ways. Full reporting capability. Automatically prorates and calculates closing fi gures. This Is the ~t real estate number< runcher3Vil ll· able. $1 ,295.00 Complete. Satisfied Customers Coost To COaSt. Bell Data Sy$tems. 303 Guaranty Building. 120 S. Olive Avenue, West Palm Beach, Florida 33401, 005) 833.0454.

FOil: SALE: Conference table approxImately 14' long and 5' wide In excellent I;ondition, Also a Ril;oh FT6200 FII: copier. Inquiries clIlI Jeff Dahon (205) 25 1·3000 or write 3000 SouthTrust Tower, Birmingham, Alabama 35203. FOil: SALE: Alabama Digest, Alabama Reports 10 1886, Southern and Southern 2nd to date, Wright's Federal Practice 366

FOR RENT FOR RENT: Spacious law office$. twoStory brick building. furn lshed-desks, chairs, filing cabinets, etc" and law library (not up-to-date). Write P.O. BOk 699, Grove Hill, Alabama 36451. phone (205) 275-3470, FOR RENT: Birm ingham, Southside; 2,300 sq. fl.: beautifully decomted: free Pilrking; $8.95 per sq. ft.; carpeted;

of, fuculty, students, administrators. support staff, alumni and friends of the law school. Prior ekperience in law practice, business, the Judiciary or law school administration could be help(ul, but Is not essential. Although the posl. tlon will remain open until fil led, applications and nominatioos should be senl to arri ve by December I, 1987, and addressed to Professor Camille w, COO«, Chair, Dean Search Committee, University of Al a~ma School of law, Box 1435, Tuscaloosa, Alabama 354B7. Candidates must Include a curriculum vitae and bibliog(lphy of publications, a description of relevant admlnlstmtlon ellperlence and, where .;Ippropriate, a resume of experience in a legal or judiCial career. The UniversiTY of Alabama Is an equal opportunity, af· firmatlve action emplay-er.

draperies, Phone (lOS) 939-1327,

SERVICES POSITIONS OFFERED ATIORNEY JOBS-Natloml' and Fed· eral Legnl Employment Report: highly regarded monthly detailed listing of hundreds of a"orney and law-related jobs with U.s. Government, ()(her publidprlvatl! employers In Washington, D.C. , throughout U.s. and abroad. $30- 3 months; $S0-6 months. fi!d. eral Reports.. 1010 ~rmon t Ave., N,W" '408-.4.8, washington, D,C. 20005. (202) 393·3311, Vin/MC, THE UN IVERS ITY OF ALABAMA SCHOOL OF LAW Invites applications and nOminations for the position of Dean of the x hool of law. Candidates must possess the J,D. or LL.B. d~rOO from an ABA-a«redited law school and must be dedicated to excellence In professional education . Candidmes must be ekpcrlenced In the legal community and have an established retord of achievement. preferably as teachers and scholars. Cilndidales must be able to work with, and command the respect

EXAM INATION OF QUESTIONED DOCUMENTS: Handwriting. typewrit. Ing and related Ckamlnations. Interna· tlonally court,qualJned expert witness, Diplomate, American Board of forensic Document Examiner'S. Member: An)(!r1can Society of Questioned Document Ek.1miners, the InternatIonal Association for IdenTification, tnc British forensi c Science Society and the NaTional Association of Criminal Defen se Lawyers. Rc!tircd Chid Document bamlner, USA CI laboratories. Hans Mayer Gidion, 218 MerryR1()nt Drive, Augusta, Georsla ]0907, (404) 8604267, FIRE INVESTIGATIONS (or attorneys and Insurance companies. Our nrm specializes In fire, fraud, arson, subrogation and survelliance, Insurance background. Qualified in state and federal court. References and mtes will be furni shed upon reque~t . lames E, Posey, Ir" and Unda F. Hand dIbI. Investigative Servkes, 4849 1()fh AYenUe, N" Birmingham, AiabamlllS212 (20S) 591·1 164,

NOI-ember 1987

Classified Notices LEGAL RESEARCH HELP: Experienced

attorney, member of Alabama Bar since 1977. Access to liM' school and Siale law libraries. WestliM' available, Prompt deadline SCrv1(e. SJSlhour. Sarah Ka th ryn farne ll, 112 Moore Building, Montgomery, Alabama 36104, 277-

7937. In Je((crson and Shelby counties, call (ree: 322路4419. No repreSCnI.1{ion Is made about Ihe quali!y of Ihe leBal services to be performed or Ihe Cxper-

VALUATIONs/FAIRNESS OPINIONS Closely-held Buslnessts, Banks, Professional Practices. for ESOPs, Gifts, Estate Planning, Sha~lder Disputes. Dissolutions, Economic Loss. Experience with hundreds of cases arld many Industries. litigation Support. Courl Testimony. Call1write fo r our Newslcncr. Mercer

CERTIFIED BUS INESS APPRA ISALS/EVALUATIONS: A-.oid conflict of inlerest while helping your dlent with legal matters arxf the new 1.1)( laws. You get a defensible value by usi ng our con. lacls and knowledge In thi s specialty. We v.'Ork for you or dlent. hpcrl wit路 ness. Confidential. One of only 70 ISA Certified In the U.S. D. Richards. CHA., RA Financial Serv., P.O. Box 7016, Creenville, Sooth Carolina 29606. Phone (803) 292路1450.

Capil.lI Management, Inc., 1503 Union Avt. '201, Memphis.. Tennessee 38104 (901) 725-0352.

lise o( the I~r performing such ser路

vices.

Classified Notices

Deadline For January 88 Issue

FORENS IC SCIENCE CONSULTANTS: Court-qualined Forensic Consu h.mts avJHablc In Ihe follO'N lng ilrt!as: forensi c Serology (blood & semen identification & typlng), Trace Evidence, Fire Debris ....nalysis, Firearms Examina-

Is NOYember 27th.

tion, Fingerprint Identification & Ex-

for More Informmion:

amination, Solid Dos.1se Drug "nalysis. Resumes Available. P.O. 80x 7571, Mobile, Alabam.. 36607. Phone (20S) 626-9284.

Contact Margaret Lacey PD. Box 4156, Montgomery, Al 36101

hor Once again, The Alabama Lavvyer is sponsoring a short story contest for Alabama attorneys w ho " moonligh t" as au thors. Members are invited to participate by sending two copies or their story to the Lavvyer NO LATER THAN February 29, 1988. The subject mailer is up to the author. Keep stories to 3,000 word s or less-typed, doublespaced, on letter-size paper. A current photograph of the author mu st be submitted at the same time the story is sent; the photographs will be returned if requested in writing. The winning shon story, and others if space permits, will appear in the May 1968 issue of the Lawyer. Send stories to! Margaret Lacey

The Alabama Lawyer

NOTICE The wa llet-size duplicates o( your license (or identifica tion purposes and the specia l n"lcmbership ca rd s for the 1987-88 bar year w ill be delayed until midDecember. These cards w ill be computer-generated thi s year and our source has been delayed in providing LIS the com puterized forms.

P.O. Box 41 56 Montgomery, Alabama 36101

The Alabama Lawyer

3.7

THOSE WHO AREN'T COMPETITIVE END UP HERE. It's fI fact o f life, off the field as well as on. The players who are strong [llld skillful; those w ho assemble the best team reach their goa l. The o thers wlltch from the sideli ne. Our goal is to provide you w ith the very best pro{essional liability insurance coverage. And we have the len m to bea t. The Alabama Sta te 13M. Your "ssociaticn, solely dedicated to serving Alabmna nttorncys . In touch with your needs. Kirke-Vi1 n Orsdcl lnsur.:mce Services . The n<llion's largest ildmi r,istrnlor of b<lr-sponsorcd liabi lity insurance programs. Experienced. Responsive, A company built on eX芦'ptional customer service. The Ho me In s urilllCC Comp.my. Undcrv.'riter of more profession,, ] liability insurance plans than any other.

Renowned <IS the nation's premier liabi lity insurance carrier, Together, we've designed the lPl plan you've been waiting (or, O ne of th e broadest policies in the Un ited Stales, Competitively priced , With the most responsive customer servi ces a nyw here, You be the judge. Just cn ll Kirke-Villl OrsdellnSlIrilllCe Services toll-fn_'C, 1-80044 1- 134410 fi nd Ollt more Ilbout the AI,, 路 b.llllll Sta te B.:lr's new Lawyers Professional Liability Pllln , You 'll discover tha i we didn' t just come to piny, We ca rne to win ,

Kirk,,路 Van Orsdel Ins uril ilce Si:rv1cCS, Inc. m Tlm,t SlrL.... t I [Ns MuillI.'S, low,) 5O.3()L)

368

November 1987

Ex Arguendo ... "A democracy cannot exist as a permanent form of government. It can only exist until the voters discover they can vote themselves largess out of the public treasury. From that moment on the majority will always vote for the candidate promising the most from the public treasury - with the result that democracy will collapse over a loose fiscal policy, always to be followed by dictatorship."

11IRMINGHAM PU BLI SHI NG CO MPANY 130 S. 191h

Sl r~cl .

l1irmingh:ull. Abb:lma 35233 2051251 路5 11 3 FAX 205125 1路 2222

Fina ncial <lnd Legal Primers Since 19 10