Johnson v. BPS Direct, LLC

JAN JOHNSON, Plaintiff, v. BPS DIRECT, LLC, et al., Defendants.

Case No. 4:19-CV-1142-CLM

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ALABAMA MIDDLE DIVISION

November 2, 2020

MEMORANDUM ORDER

Plaintiff Jan Johnson ("Johnson") fell and injured herself in a parking lot owned by Defendant White River Marine Group, LLC d/b/a Triton Boats ("White River"), a subsidiary of Defendant BPS Direct, LLC ("BPS Direct"). Johnson sues BPS Direct and White River ("Defendants"), alleging common law negligence and wantonness. Doc. 1.

Johnson is from and sued in Alabama, but she fell in Tennessee. Defendants have moved for summary judgment on all claims, arguing that the claims are time-barred under Tennessee's 1-year statute of limitation. See Tenn. Code § 28-3-104(a)(1)(A). Doc. 36. But as detailed within, the court finds that (1) Alabama's 2-year statute of limitations applies and (2) equitable concerns do not prevent Johnson from choosing to file her case in a State with a longer statute. So the court denies Defendants' motion for summary judgment.

STATEMENT OF THE CASE

Johnson fell and injured herself on November 7, 2017. She sued Bass Pro World, LLC on November 1, 2018, in Tennessee state court. That case was removed to federal court. But Bass Pro World, LLC neither owned nor operated the parking lot, so it moved for summary judgment. Johnson filed a motion to voluntarily dismiss her case to refile against new Defendants, which the federal granted.

Johnson then filed this diversity action against Defendants on July 19, 2019, having learned that they (not Bass Pro World, LLC) owned the parking lot. In other words, Johnson sued Defendants more than one year, but less than two years, after she fell—thus the fight over the 1-year versus 2-year statutes of limitation.

STANDARD OF REVIEW

I. Rule 56 Standards

Summary judgment is appropriate when there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a). The moving party "always bears the initial responsibility of informing the district court of the basis for its motion[.]" Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). But once a defendant raises a statute of limitations defense, the plaintiff must prove they filed the action in the allowable period. Vinsant Painting & Decorating, Inc. v. Koppers Co., 822 F.2d 1022, 1022 (11th Cir. 1987).

II. Statute of Limitation: Choice of Law

A federal court sitting in diversity applies the choice of law rules of its home state. See Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496 (1941). In tort cases like this, Alabama looks to the place of the injury (lex loci delitci) to determine substantive rights, and the place of the forum (lex fori) to determine procedural rights. See Middleton v. Caterpillar Indus., Inc. 979 So.2d 53, 57 (Ala. 2007). So the question is whether Alabama courts consider Tennessee's 1-year statute of limitation a substantive or procedural right. Because the answer to this question has split courts in this district, the court saves this discussion for its analysis section.

ANALYSIS

The parties agree on the relevant facts, and neither seeks summary judgment on the merits of Johnson's claims. Rather, BPS raises one legal and one equitable argument: (1) Johnson's claims are barred by Tennessee's 1-year statute of limitation, and if not, (2) the court should dismiss Johnson's claims as a matter of equity because Johnson exploited Alabama's longer (2-year) statute of limitation, to Defendants' detriment. The court addresses each argument in turn.

I. Statute of Limitation

The question is clear enough: If a Plaintiff is injured in Tennessee and files her case in Alabama, does Tennessee's 1-year statute of limitation, see Tenn. Code § 28-3-104(a)(1)(A), or Alabama's 2-year statute of limitation, see Ala. Code § 6-2-38, apply? But the answer has confounded this court, as shown by the conflicting results among judges in this district. Compare Reece v. Intuitive Surgical, Inc. 63 F. Supp. 3d 1337. (N.D. Ala. 2014) (applying Alabama's 1-year statute in a products liability case); Randolph v. Tennessee Valley Authority, 792 F. Supp. 1221 (N.D. Ala. 1992) (applying Alabama's 1-year statute in a simple negligence case) with Murphy v. McGriff Transp., Inc. 2012 WL 3542296 (N.D. Ala. Aug. 15, 2012) (applying Tennessee's 2-year statute in a wrongful death case).

The problem is not our ability to interpret Alabama law; rather that the Alabama Supreme Court announced conflicting standards for determining what constitutes a "substantive" statute of limitation in the early to mid-1980's. See Randolph, 792 F. Supp. at 1222 (stating that the state supreme court "created undisguised confusion" with its 1980 Bodnar decision); Murphy, 2012 WL 3542296 at *1 (stating that the 1980 Bodnar decision "muddied the water"). Below, this court straps on its waders and enters the same muddy waters.

A. Alabama's Standard: "Statute of Creation" or "Public Policy"

Again, if a tort occurs in a foreign State, Alabama conflict of law rules say that the foreign State's law governs substantive issues and Alabama law governs procedural issues. The Alabama Supreme Court determines whether the foreign State's statute of limitation is substantive or procedural. See, e.g., Etheredge v. Genie Indus., Inc., 632 So.2d 1324, 1326 (Ala. 1994) ("it is up to this Court to determine,for the purpose of this action, whether §1-50(6) is a substantive part or procedural part of North Carolina law").

The following chart summarizes the conflicting state-law standards that have been applied in this federal district:

"Statute of Creation" or "Built-in"

"Public Policy"

Rule

Is the foreign State's time limitation

so bound up in the statute creating the

cause of action that the time

limitation is considered a part of the

substantive right itself?

Is the foreign State's time

limitation part of that State's

"public policy"?

Leading

Case

Etheredge v. Genie Indus., Inc., 632So.2d 1324 (Ala. 1994)

Bodnar v. Piper Aircraft Corp.,

392 So.2d 1161 (Ala. 1980)

Johnson argues that the "statute of creation" rule governs; Defendants argue that the "public policy" rule governs. So the court delves into Alabama Supreme Court history to determine which party is right. As you will see, one case—Bodnar v. Piper Aircraft Corp., 392 So.2d 1161 (Ala. 1980)—is responsible for the confusion.

1. Pre-Bodnar: Before 1980, Alabama's rule was clear and was perhaps best explained in the following passage from the 1973 Battles decision:

The general rule, long accepted by most of the courts of this country for determining the statute of limitations to be applied in such [wrongful death] cases as the Mullins case and the case at bar is to the effect that where a wrongful death occurs outside of the state in which the action is brought, the statute of limitations of the state where the action is brought controls unless the homicide or wrongful death statute where the accident occurred has a built-in statute of limitations. In that event,the statute of the state where the accident occurred is generally held to control.

Battles v. Pierson Chevrolet, Inc., 274 So. 2d 281, 285 (Ala. 1973). As Battles made clear, the only time that a foreign State's statute of limitation applied in a tort action was if the foreign time-bar was "built in" to the foreign statute that created the cause of action. Id. If the time-bar was found anywhere else, Alabama's statute applied.

2. Bodnar (1980): Francis Bodnar was killed in a plane crash in Georgia. Her estate filed a wrongful death action in Alabama, where the plane was sold. At the time (1977), Alabama's general statute of limitation was one year and Georgia's statute was two years—the opposite of the present conflict.¹ Bodnar, 392 So. 2d at 1162-63. Ignoring its historical "built in" rule, the state supreme court held that Bodnar's claim was governed by Georgia's two-year statute because (a) she pleaded in her complaint that the Georgia statute of limitation applied and (b) "the Georgia Supreme Court has declared the two-year period stated in Ga. Code §3-1004 to be 'the public policy' of that state." Id. at 1163 (quoting Taylor v. Murray, 204 S.E.2d 747 (Ga. 1974)).

3. Post-Bodnar to Etheridge (1994): The supreme court next took up the issue in Sanders v. Liberty Nat'l Life Ins. Co., 443 So. 2d 909 (Ala. 1983). Sanders pleaded fraud under Florida law. Florida's applicable statute of limitation was four years;Alabama's was one year. Id. at 912. The following is the entire state supreme court's analysis:

Alabama courts will only apply another state's statute of limitations when it is demonstrated that 'the limitation is so inextricably bound up in the statute creating the right that it is deemed a portion of the substantive right itself.' Department of Revenue v. Lindsey, 343 So.2d 535, 537 (Ala.Civ.App.1977). In other words, the limitation must be found to be a part of the 'public policy' of the other state. See Bodnar v. Piper Aircraft Corp., 392 So.2d 1161, 1163 (Ala.1980). Sanders has failed to show this court that such is true of the Florida statute of limitations applicable to fraud. Consequently, Alabama's one-year statute of limitations was properly applied by the trial court, and Sanders's fraud counts are barred in the courts of this state.

Id. As you can see, the supreme court reverted to the traditional "built in" rule. The court paid lip service to Bodnar by saying that a State shows that its time-bar is "public policy" when the State includes the time-bar in "the statute creating the [substantive] right." Id. Of course, that's not what Bodnar held. Rather, this single line appears to be the state court's attempt to gloss over its refusal to apply its historical "built in" rule in Bodnar.

Just one year later, Bodnar disappeared entirely. In Cofer v. Ensor, 473 So. 2d 984 (Ala. 1985), the supreme court had to determine whether a statute of limitation was tolled, which required the court to...