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In Stead v. Blue Cross-Blue Shield of Alabama, 294 Ala. 3, 6, 310 So.2d 469, 471 (1975), this Court stated that the allowance of an amendment is in the discretion of the trial judge, although the refusal of an amendment must be based on a valid ground.
Summary of this case from Kimbrel v. Mercedes-Benz Credit CorporationOpinion
SC 977.
March 6, 1975. Rehearing Denied April 17, 1975.
Appeal from the Circuit Court of Jefferson County, Deason, J.
John H. Lavette, Birmingham, for petitioner.
Amendments in Alabama are to be liberally allowed. Miller v. Holder, 292 Ala. 554, 297 So.2d 802 (1974); Rule 15(a) and (b) Alabama Rules of Civil Procedure; Farmer v. Hill, 243 Ala. 543, 11 So.2d 160 (1943). The policy in Alabama is to disregard technicality and form in order that the civil rights of litigants may be asserted and tried on the merits. Committee Comments, Rule 1, Alabama Rules of Civil Procedure; Ex Parte Weissinger, 247 Ala. 113, 22 So.2d 510 (1945). Mandamus is allowed in Alabama as an emergency appeal for the prevention of undue injury and will lie for the erroneous refusal of the lower court to allow an amendment to a complaint. Miller v. Holder, 292 Ala. 554, 297 So.2d 802 (1974), supra; Ex Parte Weissinger, 247 Ala. 113, 22 So.2d 510 (1945), supra; Ex Parte Watters, 180 Ala. 523, 61 So. 904 (1913). An amendment to a complaint is not barred by the Statute of Limitations as long as the claim arises out of the conduct, transaction, or occurrence set forth in the original pleading. Rule 15(c) Alabama Rules of Civil Procedure. Where plaintiff files a motion to amend his complaint by adding an additional cause of action, however unlikely it may seem that plaintiff could sustain a cause of action, he is entitled under the rules to an opportunity to prove it. Rule 15(b) Alabama Rules of Civil Procedure, supra; Rule 8(f) Committee Comments Alabama Rules of Civil Procedure; Breier v. Northern Cal. Bowling Proprietors' Ass'n, 316 F.2d 787 (9th Cir. 1963); Mc Naughton v. New York Cent. R. Co., 220 F.2d 835 (2d Cir. 1955). The grant or denial of an opportunity to amend is within the discretion of the trial court, but refusal to grant leave to amend without a justifying reason is not an exercise of discretion, it is an abuse of discretion and inconsistent with the Federal Rules. Miller v. Holder, 292 Ala. 554, 297 So.2d 802 (1974), supra; Foman v. Davis, 371 U.S. 178, 83 S.Ct. 227, 230, 9 L.Ed.2d 222 (1962). Mandamus will be allowed to correct the erroneous refusal of the trial court to allow an amendment, because it is the most speedy and inexpensive way of proceeding with plaintiff's suit and the Alabama Rules of Civil Procedure shall be construed to secure the just, speedy and inexpensive determination of every action. The proceeding is merely an emergency substitute for an appeal, and in fact accomplishes with greater expedition the same result, viz., the correction of judicial error. Miller v. Holder, 292 Ala. 554, 297 So.2d 807 (1974); Ex Parte Watters, 180 Ala. 523, 61 So. 904 (1913), supra; Rule 1, Alabama Rules of Civil Procedure. A Defendant is put on notice under Rule 15(c) of any additional claim the plaintiff may have as long as the claim asserted in the amendment arises out of the conduct, transaction, or occurrence set forth in the original pleading. Wright Miller, Federal Practice and Procedure: Civil § 1497 Page 489 et seq; Zagurski v. American Tobacco Co., D.C., 44 F.R.D. 440 (1967); Barthel v. Stamm, 145 F.2d 487, 491 (5th Cir.), cert. denied, 324 U.S. 878, 65 S.Ct. 1026, 89 L.Ed. 1430 (1945). Amendments under Rule 15, Alabama Rules of Civil Procedure are allowed unless the Defendant can show actual prejudice. Prejudice ordinarily is not considered to have occurred unless the motion is made during or after the actual trial. Wright Miller, Federal Practice and Procedure: Civil § 1488 Page 435 et seq; Jenn-Air Prods. Co. v. Penn Ventilation, Inc., 283 F. Supp. 591 (D.C.Pa. 1968).
J. Gusty Yearout, Birmingham, for respondent.
A party may amend his pleadings once as a matter of course at any time before a responsive pleading is served or if the pleading is one to which no response to pleading is permitted and the action has not been placed upon the trial calendar, he may so amend it at any time within thirty days after it is served. Otherwise, a party may amend his pleadings only by leave of court or by written consent of the adverse party; and leave shall be freely given when justice so requires. Alabama Rules Of Civil Procedure, Rule 15(a). Matters resting in sound discretion of trial court will not be disturbed on appeal unless there has been clear abuse of discretion. Colquett v. Williams, 264 Ala. 214, 86 So.2d 381; Ex Parte Jonas, 186 Ala. 567, 64 So. 960; Ex Parte Nolen, 223 Ala. 213, 135 So. 337; Sovereign Camp WOW v. Ward, 201 Ala. 446, 78 So. 824. The more common reasons for denying leave to amend are that the amendment will result in undue prejudice to the other party, is unduly delayed, is not offered in good faith, or that the party has had sufficient opportunity to state a claim and has failed. Miller v. Holder, 292 Ala. 554, 297 So.2d 796 (1974); Foman v. Davis, 371 U.S. 178, 83 S.Ct. 227, 9 L.Ed.2d 222. Although Rule 15(a) states that leave to amend shall be freely given when justice so requires, this is not a mechanical absolute and the circumstances and terms upon which such leave is to be "freely given" is committed to the informed careful judgment and discretion of the trial judge as he superintends the development of a cause toward its ultimate disposition. Lone Star Motor Import, Inc. v. Citroen Cars Corporation, 5 Cir., 288 F.2d 69 (Texas); Klee v. Pittsburg and West Virginia Railway Company, D.C., 22 F.R.D. 252. Perhaps the most important facts are listed by the court and the most frequent reason for denying leave to amend is that the opposing party will be prejudiced if the movant is permitted to alter his pleading. Federal Practice and Procedure, Wright and Miller, § 1487, p. 428. United States v. Hougham, 364 U.S. 310, 81 S.Ct. 13, 5 L.Ed.2d 8; Zenith Radio Corporation v. Hazeltine Research, Inc., 401 U.S. 321, 91 S.Ct. 795, 28 L.Ed.2d 77; Taxicab Operators Association of San Francisco v. Yellow Cab Company, D.C., 278 F. Supp. 979. Leave to amend is within the sound discretion of the trial court and will be denied where fairness to the opposing party so requires. Obland v. United States, D.C., 278 F. Supp. 989; Royal Indemnity Company v. Olmstead, 9 Cir., 193 F.2d 451, 31 A.L.R.2d 635. Whenever the claim or defense asserted in the amended pleadings arose out of the conduct, transaction or occurrence set forth or attempted to be set forth in the original pleading, the amendment relates back to the date of the original pleading, except as may be otherwise provided in Rule 13(c). Alabama Rules of Civil Procedure, Rule 15(c). To test whether a new cause of action is set up by amendment of complaint is whether the proposed amendment is a different matter, another subject of controversy or the same matter more fully and differently laid to meet the possible scope of testimony. Knox v. Cuna Mutual Insurance Company, 282 Ala. 606, 213 So.2d 667; Alabama Consolidated Coal and Iron Company v. Heald, 154 Ala. 580, 45 So. 686; United States Steel v. McGehee, 262 Ala. 525, 80 So.2d 256; Federal Practice and Procedure, Wright and Miller, § 1497, pp. 489-490, 500; United States v. Johnson, 5 Cir., 288 F.2d 40.
Petitioner filed his original complaint against Blue Cross-Blue Shield on February 21, 1972, claiming damages of $6,000 for breach of a policy of insurance issued to him on October 1, 1970. Blue Cross denied the claim because of pre-existing illness. It appears that petitioner had a history of drug addiction and schizophrenia. The policy contained a provision which required the policy to be in effect for a minimum of nine months for a condition existing prior to date of inception of the policy. After the policy was five months old, petitioner was hospitalized for treatment of drug addiction and schizophrenia.
After suit was filed, petitioner moved to Kentucky. Upon motion of petitioner the suit was continued a number of times during the period of two years following the filing of the suit. When the case was set for trial in February, 1974, petitioner asked leave of the court to amend his complaint. While the original complaint was short and simple, and sounding in contract, the amendment was sixteen pages long, encompassing inter alia fraud, misrepresentation, negligence, and wanton breach of contract. Damages for $125,000 were claimed. Blue Cross-Blue Shield opposed the amendment, and in August, 1974, Judge Deason denied the motion to amend.
Petitioner filed a writ of mandamus in this court to require the trial judge to allow the amendment. The petitioner says that the spirit of Rule 15, Alabama Rules of Procedure, requires that amendments be freely allowed. Petitioner avers that the remedy of appeal is not adequate in this case, because, if successful, it would require another trial on the fraud counts. He would suffer irreparable injury in such event.
Blue Cross-Blue Shield claims the averments in the amendment were sufficiently expressed in the original complaint. It claims any fraud or misrepresentation prior to the inception of the policy should not be allowed because (1) it would be unjust to require Blue Cross-Blue Shield to prepare for trial on acts which took place three years preceding any notice of such claim, and (2) petitioner would not be inconvenienced by having to try his case on breach of contract, and (3) the claim of fraud would be barred by the statute of limitations, since there was no newly discovered evidence which was not available when the original complaint was filed, and (4) the filing of the amendment was unduly delayed.
Both briefs in this cause make use of the recent case from this court, Ex Parte Miller, 292 Ala. 554, 297 So.2d 802 (1974). In that case, the plaintiff wanted to amend his complaint to add two additional defendants in an action for wrongful arrest and imprisonment. The amendment was offered six months after the original complaint was filed and, of course, involved no new issues at trial. Mr. Justice Coleman concluded that the remedy of appeal would not be adequate because it would put the plaintiff to the expense of a second trial, assuming he was successful on his appeal from a final judgment in the first trial. This would have amounted to an undue injury in an effort to simply amend a complaint. Mandamus was granted conditionally in Miller for that reason. However, in that opinion, it was pointed out that mandamus will not always be the proper reemdy for reviewing a disallowance of an amendment to pleadings:
"It is not to be assumed or understood, however, that mandamus will be allowed as a method of reviewing all rulings denying the right to amend a complaint or other pleading. In accord with the weight of authority and sound reasoning, it may well be that review of the great majority of rulings allowing or disallowing amendments will be only by appeal."
Rule 15 and the Committee Comments have been aptly stated in Miller and there is no need to reiterate them in this opinion. We simply state here that if Rule 15 is to be of any benefit to the bench, bar, and the public, the trial judges must be given discretion to allow or refuse amendments. However, we state that amendments are to be freely allowed and refusal of an amendment must be based on a valid ground. We state also that Rule 15 must be liberally construed by the trial judges. But, that liberality does not include a situation where the trial on the issues will be unduly delayed or the opposing party unduly prejudiced.
In looking at this case we must weigh the prejudice to the defendant Blue Cross against the possibility that the petitioner will have to go through a second trial. The evidence upon which the defense on the policy would rest consists of the policy itself and its language, medical testimony concerning pre-existing illness. In the case of fraud and misrepresentation, the defendant would have tried to find all the people who processed petitioner's application three years ago, or had anything to do with it.
The petitioner has had a long history of delays and continuances in this case. He proceeded on the original complaint for over two years. The petitioner states that:
"In or about August or September 1973, certain facts began to surface which Petitioner felt could amount to fraud on the part of the Defendant. This situation is reflected by testimony on pages 34-36 of Defendant's deposition of Eston H. Stead, Jr., taken on April 1, 1974."
A reading of that testimony does not indicate any evidence of fraud on the part of the company. In fact, according to the respondent's brief there was no evidence that Stead ever talked to anyone from Blue Cross before he took out the policy. This amendment was offered just before a third setting of trial. All of the fraud facts were available at the time the original complaint was filed or certainly within one year after it was filed. While the trial judge does not give reasons for overruling the motion, these things were no doubt considered in the exercise of his discretion.
Petitioner says that he would be irreparably injured by taking an appeal in this question and possibly be faced with a second trial. That alone is no reason, because that is a possibility every time appeal, rather than mandamus, is pursued. Justice Coleman indicates that it is contemplated that the majority of these cases will be decided by appeal, which involves the possibility of a second trial. This case is clearly distinguishable from Miller because there the plaintiff would have had to proceed on the identical theory in both trials, but against different defendants. Here, the second trial, if it came to pass, would involve a different theory and different evidence, albeit the same parties would be involved. In light of these circumstances and this court's reluctance to use this writ save for those instances where there is no other adequate remedy, the rule nisi is quashed and the petition for writ of mandamus is denied.
Rule nisi quashed and petition for writ of mandamus denied.
HEFLIN, C. J., and BLOODWORTH, ALMON and EMBRY, JJ., concur.