INSURANCE - EMPLOYERS MUTUAL CASUALTY COMPANY V. HOLMAN BUILDING CO., LLC

Oct 28, 2011

In Employers Mutual Casualty Company v. Holman Building Co., LLC, [Ms. 1100106, Oct. 28, 2011] __ So. 3d __(Ala. 2011), the Alabama Supreme Court reaffirmed that the decision to allow an insurer to intervene in an underlying liability case lies within the broad discretion of the trial court. The case involved a putative class action resulting from defective "Chinese" dry-wall that was installed in the plaintiffs' homes. The defendant homebuilder's insurer moved to permissively intervene in order to have insurance issues decided as part of the underlying liability case. The trial court denied the insurer's motion and the insurer appealed. Rule 24(b) of the Alabama Rules of Civil Procedure governs permissive intervention in Alabama state courts. In Universal Underwriters Insurance Co. v. East Central Alabama Ford-Mercury, Inc., 574 So. 2d 716 (Ala. 1990) and Universal Underwriters Insurance Co. v. Anglen, 630 So. 2d 441 (Ala. 1993), the Supreme Court previously held that an insurer may permissively intervene under Rule 24(b) in order to (1) seek a bifurcated trial in which insurance matters would be tried subsequent to the underlying claims; or (2) request a special-verdict form or a general-verdict form accompanied by interrogatories so that the insurer may ascertain the basis of the jury's verdict. The intervening insurer in Employers Mutual argued that the trial court had no discretion to deny its motion to intervene because, in contrast to prior cases, it had requested a bifurcated trial and, in the alternative, a special-verdict form or a general verdict form with interrogatories. The Supreme Court, however, rejected the insurer's arguments, noting that a "motion for permissive intervention is inherently within the discretion of the trial court" and "nothing in Rule 24(b) deprives a trial court of its discretion . . . merely because the putative intervenor seeks multiple forms of relief in the alternative." Accordingly, the trial court's order denying the insurer's motion for permissive intervention was affirmed.