ALABAMA REFORMS

Appeal Bond Reform: H.B. 220 (2006): Code of Ala. § 6-12-4.  Limits the amount a signatory to the Master Settlement Agreement can be required to pay to secure the right to appeal to $125 million.

Appeal Bond Reform: (1987).  Repeals Alabama's affirmance fee rule, which assessed a fee of 10% of the judgment against defendants (but not plaintiffs) who appealed cases and lost.

Class Action Reform: SB 72 (1999): Code of Ala. § 12-16-63.1, §12-16-75; amended §12-16-8, §12-16-8.1, §12-16-63, §12-16-70, §12-16-74, §12-16-76, §12-16-82.  Sets procedures to certify class actions.  Codifies Supreme Court rulings to ensure that a defendant receives adequate notice prior to class certification.  Provides for an immediate appeal of any order certifying a class or refusing to certify a class, and for an automatic stay of matters in the trial court pending such appeal.

Collateral Source Rule Reform: (1987): Ala. Code § 6-5-545.  Permits the admissibility of evidence of collateral source payments.  The collateral source rule reform in civil tort cases did not violate the right to trial by jury, or the due process, equal protection, access to courts, or right to a remedy provisions of the State Constitution, or the principle of separation of powers.  Marsh v. Green, 782 So. 2d 223 (Ala. 2000) (overruling American Legion Post No. 57 v. Leahey, 681 So. 2d 1337 (Ala. 1996).   

Expert Evidence Reform: S.B. 187 (2011).  Adopts the Daubert standard and a later US Supreme Court decision, Joiner.  Together these cases established a framework for admitting scientific expert testimony in order to preclude introduction of "junk science" into courtrooms.  The federal three-part test for courts to use in determining whether to admit scientific expert testimony has been adopted in full and allows the courts to exclude unreliable testimony or even testimony that may draw from reliable procedures and principles, but whose conclusions are unsupportable.  This permits the full breadth of Daubert and Joiner to now be applied in Alabama courtrooms as it is in all federal courtrooms and a majority of other states.  The compromise that was reached in S.B. 187 does not adopt the Daubert progeny called Kumho, which extends these rules to non-scientific expert testimony.  Also exempted were certain criminal and domestic relations cases.  However, nothing precludes the courts in Alabama from later extending these rules to such testimony. 

Foreign Corporations Liability Reform: Referendum (1988).  Amends the constitution to remove double standards between foreign corporations and domestic corporations.

Forum Non Conveniens Reform: (1987).  Gives judges the authority to refuse out-of-state cases on the basis of convenience or inconvenience to parties and witnesses and allows judges to transfer cases to the most appropriate court.

Frivolous Lawsuit Sanction: (1987).  Allows a court to assess court costs and attorneys’ fees against parties bringing frivolous lawsuits.

Government Liability: Statute of Limitations: SB 35 (1996): Ala. Code § 6-2-33.  Establishes a 10-year statute of limitations for specified actions brought against public officials and municipalities.

Judgment Interest Reform: S.B. 207 (2011).  Changes the rate of interest on judgments in Alabama from 12% to 7.5%.  Prior to the enactment of S.B. 207, a defendant who lost a lawsuit and chose to appeal had to begin paying 12% post-judgment interest on the amount the court or jury awarded the plaintiff, creating a significant financial deterrent to appealing an unjust verdict.

Jury Service Reform: S.B. 87 (special session 2005).  Provides jurors with the right to one automatic postponement with a simple and convenient method of rescheduling jury service to a more convenient time within six months.  Protects small businesses (with five or fewer full-time employees) by requiring the court to postpone and reschedule the service of an employee of a small business if another employee of that employer is summoned to jury service during the same period.  Limits the frequency of jury service to no more than once every two years.  Prohibits an employer from taking any adverse employment action against an employee solely because the person serves on a jury.  Clarifies that employers may not require an employee to use annual, vacation, or sick leave time for the period in which he or she serves.  Sets strict criteria for prospective jurors to be excused from service.  Increases maximum fine for contempt of court stemming from failure to appear for jury service without excuse from $100 to $300.

Medical Liability Reform: Damages Limits: (1987).  Limits the award of damages in medical liability cases to $1 million.  The 1987 statute setting a $1 million aggregate limit on damages awards in health care liability actions violated the right to jury trial under the State Constitution.  Smith v. Schulte, 671 So. 2d 1334 (Ala.), cert. denied, 517 U.S. 1220 (1996).   

Medical Liability Reform: Periodic Payment of Future damages: Ala. Code § 6-5-486.  Provides discretion to judges to order judgments over $100,000 to be paid in monthly installments.  A similar statute permitting the periodic payment of future damages was held unconstitutional in Clark and Halliburton v. Contain Corp., 589 So. 2d 184 (Ala. 1991), but the Alabama Supreme Court has not addressed the validity of the above-cited statute.

Medical Liability Reform: Periodic Payment of Future Damages: Ala. Code § 6-5-543.  Requires defendants to pay a lump sum of $150,000 in medical liability cases, where future damages exceed $150,000, and the remainder in periodic payments.  The statute allowing for periodic payments of personal injury awards over $150,000 violated the State Constitutional provision guaranteeing the right to jury trial.  Clark and Halliburton Industrial Services Division v. Container Corp. of America, 589 So. 2d 184 (Ala. 1991). 

Medical Liability Reform: Periodic Payment of Future Damages: (1987).  Permits judges to order the payment of damages over a period of 15 years when it is in the best interest of both parties.  The Alabama Supreme Court held the periodic payment provision unconstitutional in Billy Ray Clark and Halliburton Industrial Services Division v. Container Corp. of America Inc., No. 1900325, September 27, 1991. 

Medical Liability Reform: Procedure: (1987).  Establishes counter lawsuit procedures.

Medical Liability Reform: Sound Science: (1987).  Provides qualifications for expert witnesses in medical liability cases.  Abolishes the “scintilla” rule and substitutes the “substantial evidence” rule.  (Alabama was the only state still using the scintilla of evidence rule.)

Medical Liability Reform: Sound Science Reform: SB 194 (1996): Amended Ala. Code § 6-5-548, § 6-5-549.  Establishes parameters for “expert witnesses” in medical liability cases and provides that limits of liability insurance coverage for a health care provider are not discoverable.  The act amending a statute setting the qualifications for expert witnesses in a medical malpractice action did not violate the single subject provision of the State Constitution as applied to plaintiff’s action.  McGlothren v. Eastern Shore Family Practice, P.C., 742 So. 2d 173 (Ala. 1999).  

Medical Liability Reform: Wrongful Death: (1987).  Limits damages in wrongful death actions to $1 million.

Mini Code Law Clarification: SB 587 (1996): Ala. Code § 6-19-11, Ala. Code § 6-19-19(c).  Clarifies the consumer finance statute known as the mini code to provide guidance to lenders, retailers and consumer loan companies.

Noneconomic Damages Reform: (1987).  Limits the award of noneconomic damages to $400,000.  The statute setting a $400,000 limit on noneconomic damages awards in health care liability actions violated the right to a jury trial and equal protection provisions of the State Constitution.  Moore v. Mobile Infirmary Association, 592 So. 2d 156 (Ala. 1991).  

Products Liability Reform / Innocent Seller: S.B. 184 (2011).  Known as the Alabama Small Business Protection Act, S.B. 184 adds protection for Alabama’s retailers against product liability suits.  The suits are aimed at the manufacturers, but often the trial lawyers sue Alabama retailers, wholesalers and distributors as defendants even though they did not participate in the manufacture or design of the product.  This is done in some instances solely to allow the plaintiff to file suit in counties favorable to plaintiffs and keep an out-of-state manufacturer in an Alabama state court and out of federal court.  If, on the other hand, the suit is brought against a retailer or distributor because the manufacturer is unknown and the retailer or distributor is needed in order to provide discovery concerning the manufacturer’s identity, the bill provides a mechanism to accomplish this in a reasonable manner so that suit can then proceed against the appropriate manufacturer. 

Punitive Damages Reform: SB 137 (1999): Ala. Code § 6-11-21.  Limits the award of punitive damages in most non-physical injury cases to the greater of three times the award of compensatory damages or $500,000.  Limits the award of punitive damages in non-physical injury cases against businesses with a net worth of less than $2 million to the greater of $50,000 or 10% of the business’s net worth up to $200,000.  Limits the award of punitive damages in physical injury cases to the greater of three times the award of compensatory damages or $1.5 million.  Prohibits application of the rule of joint and several liability in actions for punitive damages, except for wrongful death actions, actions for intentional infliction of physical injury, and class actions.  Provides that the limit on punitive damages will be adjusted on January 1, 2003 and increased at three‑year intervals in accordance with the Consumer Price Index.

Punitive Damages Reform: (1987): Ala. Code § 6-11-20.  Requires a plaintiff to show by “clear and convincing” evidence that a defendant acted with “wanton” conduct for the recovery of punitive damages.  Limits the award of punitive damages to $250,000.  The statute setting a $250,000 limit on punitive damages awards violated the right to jury trial under the State Constitution.  Henderson v. Alabama Power Co., 627 So. 2d 878 (Ala. 1993).  Requires trial and appellate judges to review all punitive damages awards and reduce those that are excessive based on the facts of the case.  The Alabama Supreme Court held the judicial review of all awards unconstitutional in Armstrong v. Roger’s Outdoor Sports, Inc., May 10, 1991.

Statute of Limitations and Repose: HB 341 (1994).  Establishes a 13-year statute of repose for architects & engineers.  Provides a two-year statute of limitations on such actions.

Venue Reform: S.B. 212 (2011).  Prohibits “forum shopping” of wrongful death actions by requiring that a suit can be brought only in the county where the decedent could have filed suit.  This will prevent the practice of finding a personal representative in a plaintiff-favorable county solely for purposes of obtaining venue there due to the residency of the personal representative. 

Venue Reform: SB 305 (1999): Ala. Code § 6-3-7.  Establishes venue rules to restrict forum shopping.  Restricts lawsuit filings against corporations to qualified venues.  Specifies venue rules for class action lawsuits and actions involving multiple plaintiffs.