Fraud - Alabama Psychiatric Services, P.C. v. 412 South Court Street, LLC

In Alabama Psychiatric Services, P.C. v. 412 South Court Street, LLC, [Ms. 1100023, Sept. 30, 2011] __ So. 3d __(Ala. 2011), the Supreme Court of Alabama reversed a summary judgment in favor of 412 South Court Street, LLC, holding that substantial evidence existed to create a question of fact whether Alabama Psychiatric Services, P.C., had been fraudulently induced into entering a lease agreement. Alabama Psychiatric Services, P.C., leased office space in a building owned by 412 South Court Street, LLC. Before entering into the lease agreement, Alabama Psychiatric Services had been told that a private entrance would be constructed for its clients. However, after construction was completed, the only entrance to Alabama Psychiatric Services' office was through an open walkway that passed through a gym in the building. Alabama Psychiatric Services subsequently vacated the premises. 412 South Court Street, LLC, then sued Alabama Psychiatric Services alleging breach of the contract and seeking all rents due under the lease. Alabama Psychiatric Services filed a counterclaim alleging various torts, including that Alabama Psychiatric Services had been fraudulently induced to enter into the lease agreement. The trial court entered summary judgment for 412 South Court Street, LLC, on Alabama Psychiatric Services' counterclaim for fraudulent inducement. On appeal, the Supreme Court held that there was substantial evidence of the elements of fraudulent inducement to create a fact question for a jury. Therefore, the Court reversed the judgment of the trial court and remanded the case for further proceedings.



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