In Legal Terms - September/October 1999

Supreme Court Ruling Makes It Nice To Revisit Smitherman
In the May/June 1999 issue of The County Commissioner, I reported on the Alabama Supreme Court's decision in Smitherman v. Marshall County Commission, et al., [MS. 1971866, April 23, 1999], ___ So.2d ___ (Ala. 1999), wherein the Court held that the statutory cap on the amount of damages which may be recovered in a negligence action against the county did not apply to the employees of the county sued in their official capacity. I noted that an Application for Rehearing had been filed, and while I did not specifically state so in my article, I was very reluctant to hold out much hope - the Supreme Court of Alabama rarely revisits its own decisions. Fortunately, I was wrong. On August 27, 1999, the Supreme Court did, in essence, reverse itself, by withdrawing its original opinion in this case and substituting a new one. See, Smitherman v. Marshall County Commission, et al., [MS. 1971866, August 27, 1999], ___ So.2d ___ (Ala. 1999). The new one is a very good one - it holds unequivocally that the statutory cap does apply to the employees of the county.

The final opinion issued in the Smitherman case actually contains several important holdings regarding suits against counties and/or their officials - and in fairly clear and concise terms. Some of the issues addressed in the revised opinion had been touched on in earlier appellate decisions, but the Court apparently recognized that the prior rulings were confusing and somewhat conflicting, and attempted in this revised opinion to clarify several aspects of the law regarding suits against counties and county officials and employees.

The new opinion in Smitherman affirmatively states each of the following:

• A county commissioner is not generally subject to suit in his or her individual capacity (following its prior holding in Cook v. St. Clair County, 384 So.2d 1 (Ala. 1980)).

• There is a legal distinction between the county and the county commission (overruling in part the holding in Calvert v. Cullman County Commission, 669 So.2d 119 (Ala. 1995)).

• There is a legal distinction between the county and a county employee acting in his or her official capacity.

• A county commissioner may be sued in his or her official capacity.

• A county employee may be sued in his or her official capacity.

• Claims against county commissioners and county employees in their official capacity are subject to the statutory cap on damages.

This final point - that the cap applies to employees acting within their official capacity - is, of course, the most important holding in this case and is a major victory for counties. Moreover, the Court stated very succinctly that the cap applies as a matter of law. From the lawyer's viewpoint, that is about the best language you can find in an opinion - it means "end of discussion - this is the way it is!"

The Court applied the same rationale that it had applied in an earlier case addressing the application of the statutory cap in lawsuits against municipal employees. See, Benson v. City of Birmingham, 659 So.2d 82 (Ala. 1995). In Benson, the Court noted that the purpose of the cap was to protect public funds from exorbitant judgments and held that if plaintiffs were able to circumvent the cap simply by naming an employee and requiring the city to indemnify that employee for the total amount of a large judgment, the cap would effectively be repealed. Benson v. City of Birmingham, 659 So.2d at 86-87. In Smitherman, it stated:

To hold that the caps of § 11-93-2 did not apply to the claims against the county commissioners and the county engineer in their official capacities would, as we suggested in Benson, effectively repeal that Code section, because then the plaintiffs would simply file their actions against employees of a governmental entity instead of the governmental entity itself.

Smitherman v. Marshall County Commission, et al., supra.

The Supreme Court noted that it must interpret a statute in a way that gives some meaningful effect to the intent of the Legislature. Clearly, they recognized that exempting county employees from the protection of the cap effectively destroyed the cap altogether.

There are still some questions left unresolved in the revised Smitherman decision that will need to be answered in subsequent litigation - for instance, can the county employee be sued in his or her individual capacity, and if so, would the cap apply? The Court did rule that there were no grounds present in this case for this county employee to be sued in his individual capacity and upheld the trial court's ruling on that issue. However, it did not state whether there were any instances in which a suit against an employee in his or her individual capacity could be sustained. Furthermore, since it upheld the dismissal of the individual lawsuit against the county engineer, it did not address whether the cap would apply if such a lawsuit were allowed to stand.

It is curious that the Supreme Court made such a dramatic switch from its original holding and it is unclear exactly what persuaded them to revisit this case. However, it has certainly turned out well for everyone involved in county government. It would be foolish to think that future plaintiffs will not try to find loopholes in this decision - or perhaps to try to change the law - but as noted above, the opinion released on August 27, 1999 contains very strong language supporting the view long-held by counties and their legal counsel that the cap found in § 11-93-2 applies to the county, to all county officials, and to all county employees acting within the line and scope of their employment. Thus, it appears for now that the statutory cap will continue to provide the protection intended by the Legislature, and that while lawsuits against counties and their officials and employees cannot be eliminated, they will not result in the financial ruin of counties struggling everyday to find new sources of revenue and protect the monies that do exist for the services the Legislature intended for the county commission to provide.