Elliott Electric Supply, Inc. v. Veep Electric Service, Inc. (Appeal from Madison Circuit Court: CV-22-900109).

Rel: May 3, 2024

Notice: This opinion is subject to formal revision before publication in the advance sheets of Southern Reporter.
Readers are requested to notify the Reporter of Decisions, Alabama Appellate Courts, 300 Dexter Avenue,
Montgomery, Alabama 36104-3741 ((334) 229-0650), of any typographical or other errors, in order that corrections
may be made before the opinion is published in Southern Reporter.

ALABAMA COURT OF CIVIL APPEALS
OCTOBER TERM, 2023-2024
_________________________

CL-2023-0534
_________________________

Elliott Electric Supply, Inc.

v.

Veep Electric Service, Inc.

Appeal from Madison Circuit Court
(CV-22-900109)

HANSON, Judge.

Elliott Electric Supply, Inc. ("Elliott"), appeals from a judgment

entered by the Madison Circuit Court ("the trial court") in favor of Veep

Electric Service, Inc. ("Veep"), on Veep's claims against Elliott. We

reverse the trial court's judgment and remand the case with instructions.
CL-2023-0534

Procedural History

On January 28, 2022, Veep filed a complaint against Elliott in the

trial court. It sought a judgment declaring the legitimacy of a lien claimed

by Elliott related to services that Elliott had allegedly rendered but that,

according to the complaint, had not been requested by Veep.

Additionally, Veep asserted a claim against Elliott for tortious

interference with a business or contractual relationship related to Veep's

contractual relationship with Buquet & LeBlanc, Inc. ("B&L"). On March

17, 2022, Elliott filed an answer to the complaint; it also asserted

counterclaims against of breach of contract and "work and labor" done,

pursuant to which it sought an award of damages in the amount of

$7,807.04. Veep filed a reply to Elliott's counterclaims.

On March 14, 2023, Elliott filed a motion for a partial summary

judgment regarding the claims Veep had asserted against it. On May 8,

2023, following a hearing, the trial court denied Elliott's motion for a

partial summary judgment. A bench trial on the merits was commenced

on May 30, 2023, and was concluded on June 21, 2023. On June 28, 2023,

the trial court entered a judgment "in favor of [Veep] and against

[Elliott]" on its claim of tortious interference with a business or

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contractual relationship and directed Elliott to pay to Veep "the sum of

$30,340.64, plus the costs of the ... action"; it also ruled in favor of Veep

on Elliott's counterclaims and denied all remaining requested relief,

including Veep's claim seeking declaratory relief. On July 28, 2023,

Elliott filed a motion for a new trial and, pursuant to Rule 52(b), Ala. R.

Civ. P., for a separate statement of the trial court's findings of facts and

conclusions of law. On July 31, 2023, the trial court entered an order

denying Elliott's postjudgment motion. Elliott timely filed its notice of

appeal to this court.

Facts

Louis Van Pamel, the president of Veep, testified that Veep is based

in Athens and that it performs commercial and industrial electrical-

service installation. According to Van Pamel, in 2019, B&L, a company

based in Baton Rouge, Louisiana, had solicited a bid from Veep for a

construction project in Huntsville. Van Pamel stated that B&L was

serving as the general contractor for a new facility being built for Lamar

Advertising ("Lamar") and that when Robert Dial, the project manager

for B&L, had contacted him about submitting a bid as an electrical

subcontractor for that project, Dial had sent Van Pamel the plans for the

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CL-2023-0534

project and the "specification book" and had "mention[ed] that Elliott ...

was the national account holder for ... Lamar." Van Pamel testified that,

at the time he submitted his bid, he had been asked to provide value-

engineering options, which, he said, are alternatives for fixtures or

manufacturers that could potentially save money on the project. He

testified, however, that Elliott had ultimately been specified as the

supplier for the specific lighting system to be installed. Van Pamel stated

that it had not been his decision for Elliott to act as the supplier on the

project and that the Lamar project was the first time that he had worked

with Elliott. (R. 96, 101).

On December 9, 2019, pursuant to the bid process, Jason Bain, a

sales representative for Elliott, sent an e-mail to Veep that included a

quote for lighting and lighting controls for the Lamar project in the

amount of $93,000. Van Pamel testified that Veep had received the

contract for the project from B&L in June or July 2020, that Veep had

been responsible for all of the electrical installation and the

commissioning for the project, and that Veep had remained the sole

electrical contractor throughout the project's completion. On September

9, 2020, Elliott provided an updated quote to Veep, which included

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certain additions, increasing the total amount of the bid to $102,035; Van

Pamel stated that that quotation was a "hard bid," which entitled Elliott

to the full amount quoted. Van Pamel testified that Veep had obtained

supplies from both Elliott, which had supplied the light fixtures and

controls for the project, and Graybar Electric Company, which had

provided electrical supplies and materials, and that Veep had been

responsible for installing the supplies provided by both companies. Van

Pamel testified that Veep had provided an application for credit to Elliott

and had entered into a contract with Elliott, pursuant to which Veep had

agreed to purchase the lighting fixtures from Elliott. Van Pamel testified

that, during each month of the project, Veep had submitted to B&L an

application for a draw for the progress that had been made on the project

in that month, along with any required documentation, and that Veep

had received a monthly draw from B&L. According to Van Pamel, Veep

had paid Elliott and Graybar directly for the parts that they had

purchased and delivered, according to each invoice that he received from

each company.

Julie McClendon, an employee of Veep, testified that she had been

the primary contact for Veep's suppliers beginning in March 2021. With

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CL-2023-0534

regard to the Lamar project, she testified that, at the beginning of each

month, Veep had received invoices from its suppliers and that she had

checked the invoices to ensure that they reflected the items that Veep

had ordered and had verified the prices of the items before drafting a

check for payment and submitting everything to Van Pamel. According

to McClendon, while the Lamar project was ongoing, Veep had received

an invoice from Elliott dated June 7, 2021, in the amount of $7,807.04 for

"WKA Services." Because Veep had not requested that Elliott provide

any services on the project and both McClendon and Van Pamel were

uncertain regarding the description for the invoice, McClendon had

telephoned and e-mailed Elliott using the contact information provided

on the invoice. McClendon testified that she had spoken to Kathryn

Mayberry at Elliott's help desk and that Kathryn had informed her that

the invoice was for a "lighting start-up," which, Van Pamel explained, is

a quality-control inspection by a representative of lighting providers

following installation. According to McClendon and Van Pamel, Veep

had not ordered a factory start-up from Elliott and Elliott had not

performed a factory start-up for the project. Thus, McLendon said, she

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had sent another e-mail to Elliott, requesting more information

regarding the invoice.

Van Pamel testified that he had spoken on the phone to Eric

Pertuit, a sales representative for Elliott who had taken over Veep's

account from Jason Bain, who, he said, had informed him that the

services had not been ordered by Veep, but by B&L. He testified that he

had then contacted representatives at Elliott and B&L to clarify that

B&L did not have the authority to request services or products on Veep's

behalf and that the services outlined had not been completed and should

not have been invoiced to Veep. Van Pamel testified that, at some point,

he had spoken with Bob Jones, an area manager for Elliott, regarding the

invoice for "WKA Services" and that Jones had indicated that the invoice

was for engineering services rather than for a factory lighting start-up.

(R. 60). Van Pamel stated that he had not requested engineering services

from Elliott on the Lamar project and that he had never received an

explanation from Elliott for the invoice. McClendon and Van Pamel sent

additional communications to Elliott in August 2021, requesting that the

invoice for services be removed from Veep's account.

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CL-2023-0534

In a letter dated September 15, 2021, which was sent to Lamar via

certified mail, Robert Flores, the chief financial officer at Elliott,

"claim[ed] a lien on the land, building and improvements" located at

Lamar's site for the project in Huntsville in the amount of $7,807.04,

which, according to the letter, represented the balance due from Veep;

the June 7, 2021, invoice was attached to the letter. Veep and B&L were

sent copies of the lien notice. Van Pamel testified that the money owed

to Veep for the Lamar project, including retainage and unpaid change

orders, had been held subject to the lien notice and that payments from

B&L to Veep had been stopped. According to Van Pamel, Veep continued

to send communications to Elliott asking Elliott to produce

documentation supporting the services that Elliott was claiming had

been performed. In a letter dated December 8, 2021, which was sent to

Elliott by certified mail, Van Pamel requested that Elliott complete a

lien-waiver form that had been sent to Veep by B&L, which, Van Pamel

said, would release the lien and absolve Veep from liability.

Van Pamel testified that the last day of work on the Lamar project

had occurred in October 2021; that, for Veep's final pay application to be

processed, he needed a lien-waiver-and-release form to be signed by both

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CL-2023-0534

of his suppliers; that he had received a lien-waiver-and-release form from

Graybar but that he had not received one from Elliott; and that the final

draw and retainage owed to Veep by B&L had not been paid as a result.

He stated that Veep had also been unable to pay another company that

it had employed to perform services on the project because Veep had not

been paid by B&L. Veep presented evidence indicating that B&L had

withheld $25,356.37 from the last pay application that Veep had

submitted to B&L on November 4, 2021, and that Veep was owed an

additional $4,984.27, which amount Veep requested as damages. Van

Pamel testified that Veep could no longer recover the money from B&L

pursuant to the terms of Veep's contract with B&L. He stated that

Elliott's failure to provide a lien-waiver-and-release form had been the

only thing that had kept Veep from receiving payment from B&L.

Van Pamel acknowledged that he had received an e-mail from

Jones dated December 20, 2021, in which Jones had stated, among other

things, that the June 7, 2021, invoice had not been for "startup and

programming" but "for design and engineering services performed by

WKA Services on each Lamar Advertising project." Jones testified at the

trial that Wells Keown Associates is a representative for Eaton Lighting,

9
CL-2023-0534

of which Elliott is a customer and with which Elliott had signed a

national account agreement to supply lighting for Lamar projects. He

stated that, pursuant to each project it had undertaken with Lamar,

Wells Keown Associates had provided the lighting design for each project

before the projects were submitted for bids from subcontractors and that,

in this case, the "WKA Services" that had been invoiced by Elliott had

been performed before Veep was selected as a subcontractor. Jones

testified that someone from Elliott had "misspoke" when they informed

Veep that the invoice was for a factory lighting start-up. He stated that

the invoice submitted to Veep was for a passthrough cost for services that

had been performed by Wells Keown Associates, rather than Elliott, as

part of the lighting package that Elliott typically included in each Lamar

plant project and that the amounts quoted to and billed to Veep had

included the amount for the services provided by Wells Keown

Associates. Jones admitted, however, that there was not a line item

specifying the "WKA Services" in Elliott's quotes to Veep and that he

could not confirm whether Bain had communicated the passthrough costs

to Veep because Bain had died during the pendency of the Lamar project

and his e-mails had not been preserved. Jones also admitted that the

10
CL-2023-0534

first time another description for the "WKA Services" had been provided

to Veep after someone had "misspoke" was in his December 20, 2021, e-

mail, after the filing of the notice of Elliott's intent to claim a lien.

Van Pamel testified that Elliott had included in its bid the "WKA

Services" without Veep's knowledge or consent and that Veep had paid

the amount billed by Elliott for every light fixture and every item that

had been included on Elliott's quote.

Analysis

Elliott first argues on appeal that the trial court erred in denying

its motion for a partial summary judgment on the claims asserted against

it in Veep's complaint. This court has stated, however, that, "when there

is a trial on the merits after the denial of a summary-judgment motion,

we do not review the denial of the summary-judgment motion." Tucker

v. Moorehouse, 58 So. 3d 1262, 1268 (Ala. Civ. App. 2010). In its reply

brief on appeal, Elliott cites Murphy Oil USA, Inc. v. English, 333 So. 3d

641, 643 (Ala. 2021), in which our supreme court stated, in pertinent part:

"As a general matter, 'we do not review a trial court's
denial of a summary-judgment motion following a trial on the
merits.' Mitchell v. Folmar & Assocs., LLP, 854 So. 2d 1115,
1116 (Ala. 2003). Instead, 'the sufficiency of the evidence at
trial would be the significant question on appeal.'
Superskate, Inc. v. Nolen, 641 So. 2d 231, 233 (Ala. 1994).

11
CL-2023-0534

This is not, however, an 'ironclad rule that an erroneous
denial of a motion for summary judgment is always rendered
moot by a subsequent verdict in favor of the nonmovant, lest
we encourage a party to change "testimony or other evidence
based on experience gained during the proceedings on the
motion for summary judgment." ' Wal-Mart Stores, Inc. v.
Thompson, 726 So. 2d 651, 654 (Ala. 1998) (citation omitted).
When we are not 'confronted with a situation involving a
change of testimony, we will not consider whether the
defendant was in fact entitled to a summary judgment' but,
rather, will consider only whether a trial court properly
denied the defendant's motion for judgment as a matter of
law. Id."

Elliott argues in its reply brief on appeal that the exception to the

general rule that an appellate court will not review a trial court's denial

of a summary-judgment motion following a trial on the merits applies in

the present case. Specifically, it asserts that, in its response to Elliott's

motion for a partial summary judgment, Veep did not "provide any

evidence as to how Elliott supposedly caused damages in the form of

retainage withholding" and that Veep had "claimed for the first time at

trial that its retainage on this project expired." Elliott's reply brief, p. 12-

13. We cannot conclude, however, that Elliott has shown any distinction

in the evidence relied upon by Veep at the summary-judgment stage and

at the trial on the merits. In its motion for a partial summary judgment,

Elliott quoted Veep's interrogatory responses, which state, in pertinent

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part, that Elliott's "intentional refusal to provide documentation of the

work Elliott claims was performed led to this dispute and the withholding

of the retainage from the project" and that the "withholding of the

retainage caused by Elliott's intentional acts has damaged Veep's

business relationships." Additionally, Elliott attached to its motion,

among other things, the deposition testimony of Van Pamel, in which Van

Pamel testified that Veep had been unable to pay another company that

had provided services to Veep because Veep had not been paid by B&L,

which owed Veep "30,000-plus dollars." Van Pamel also agreed with a

statement at his deposition that it had become necessary for Veep to file

a lawsuit against Elliott to recover moneys owed, including the retainage,

and he asserted that Elliott was responsible for the retainage by sending

a notice of intent to claim lien to Lamar and to B&L.

The evidentiary assertions by Veep, as cited by Elliott at the

summary-judgment stage, are not inconsistent with Van Pamel's

testimony at trial indicating that Elliott's having sent the lien notice was

the only reason for the nonpayment of Veep's retainage on the project and

that it was no longer able to recover the retainage from B&L based on

the terms of the contract between Veep and B&L. Accordingly, we cannot

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agree with Elliott that Veep changed its testimony or other evidence

based on experience gained at the summary-judgment stage such that

the exception outlined in Murphy Oil is applicable in the present case.

To the extent that Elliott asserts that the trial court erred in denying its

summary-judgment motion because it lacked jurisdiction to consider

Veep's claim seeking a declaratory judgment, we note that, in its June

28, 2023, judgment, the trial court denied that claim and, thus, there is

no adverse ruling from which Elliott can appeal as to that claim. See

Lewis v. Providence Hosp., 483 So. 2d 398, 398 (Ala. 1986) ("Only adverse

rulings by the trial court are reviewable on appeal.").We decline,

therefore, to further consider Elliott's argument that the trial court erred

in denying its motion for a partial summary judgment as to each of Veep's

claims in its complaint.

Elliott next argues that the trial court erred in entering the

judgment in favor of Veep because, it says, Veep failed to prove the

essential elements for its claim of tortious interference with a business

or contractual relationship. In White Sands Group, L.L.C. v. PRS II,

LLC, 32 So. 3d 5, 14 (Ala. 2009), our supreme court outlined the following

elements of the tort of wrongful interference with a business or

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contractual relationship: "(1) the existence of a protectible business

relationship; (2) of which the defendant knew; (3) to which the defendant

was a stranger; (4) with which the defendant intentionally interfered;

and (5) damage." Elliott first asserts that Veep failed to prove that Elliott

was a stranger to its contract with B&L. In Waddell & Reed, Inc. v.

United Investors Life Insurance Co., 875 So. 2d 1143, 1157 (Ala. 2003),

our supreme court discussed that element of the claim, stating, in

pertinent part:

"For the sake of clarity, we adopt the term 'participant'
to describe an individual or entity who is not a party, but who
is essential, to the allegedly injured relationship and who
cannot be described as a stranger. One cannot be guilty of
interference with a contract even if one is not a party to the
contract so long as one is a participant in a business
relationship arising from interwoven contractual
arrangements that include the contract. In such an instance,
the participant is not a stranger to the business relationship
and the interwoven contractual arrangements define the
participant's rights and duties with respect to the other
individuals or entities in the relationship. If a participant has
a legitimate economic interest in and a legitimate relationship
to the contract, then the participant enjoys a privilege of
becoming involved without being accused of interfering with
the contract."

In Ex parte Blue Cross & Blue Shield of Alabama, 773 So. 2d 475,

477 (Ala. 2000), Winston Guthrie, D.M.D., sued Blue Cross and Blue

Shield of Alabama ("Blue Cross") for, among other things, tortious

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interference with a business or contractual relationship. Dr. Guthrie

asserted that Blue Cross had written letters to two of its own insureds,

who were Dr. Guthrie's patients, in response to letters it had received

from the insureds asking why Blue Cross had denied payment for certain

procedures that had been performed on the patients. Blue Cross had

explained in the letter sent to each patient that Blue Cross was denying

payment on the ground that the procedures were outside the scope of Dr.

Guthrie's license as a dentist. Id. Dr. Guthrie alleged that the letters

constituted tortious interference in his dentist-patient contractual

relations. Id. at 480. Our supreme court affirmed the entry of a summary

judgment in favor of Blue Cross on that claim based on two independently

sufficient reasons, one of which was its finding that Blue Cross was a

party to the contractual relations. Id. Our supreme court stated, in

pertinent part:

"The record establishes both explicitly and implicitly that Dr.
Guthrie and his patients contracted together in reliance on
the contractual obligation of Blue Cross to pay for dental
services covered by the policy between Blue Cross and the
patients. Interdependent contractual relations existed among
Dr. Guthrie, his patients, and Blue Cross. This contractual
situation invokes the rule that a party to a contract cannot be
charged with interfering with that contract. Bama Budweiser
of Montgomery, Inc. v. Anheuser–Busch, Inc., 611 So. 2d 238
(Ala. 1992), and Lolley v. Howell, 504 So. 2d 253 (Ala. 1987).

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While the rights and duties between different sets of parties
to a multiparty contract may differ and the respective
interests of the parties may compete, the performance of one
of the duties or the pursuit of one of the competing interests
cannot be validly branded as interference."

773 So. 2d at 480.

In the present case, Van Pamel acknowledged that, when Dial

contacted him to bid on the Lamar project, Dial had informed Van Pamel

that Elliott was the national account holder for Lamar. Van Pamel

testified that, although he had been asked to provide value-engineering

options for the project, B&L had decided to use Elliott as the supplier for

the lighting package; he stated that using Elliott as the supplier had not

been his decision and that the package had been designed with Elliott's

having been specified as the supplier for a specific lighting system.

According to Van Pamel, Veep had a written contract with Elliott that

said that "[Veep] agreed to purchase the fixtures from them." Van Pamel

stated that Elliott had supplied the light fixtures for the project, that

Veep had paid Elliott and its other suppliers for all parts and fixtures

that had been purchased and delivered by them, and that Veep's money

for those payments had come directly from B&L. Van Pamel also

testified that a lien-waiver-and-release form had been required from both

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Elliott and Graybar for Veep's last payment application to B&L to go

through and that Veep had received that document from Graybar but had

not received that document from Elliott. He admitted that his suppliers,

including Elliott, were not paid until Veep's payment application was

paid by B&L.

We conclude that the record in the present case establishes that

Veep and Elliott contracted together in reliance on the contractual

obligation of B&L to pay for the lighting package supplied for the Lamar

project. Like in Blue Cross, interdependent contractual relations existed

among Veep, Elliott, and B&L. Because Elliott had a legitimate economic

interest in and a legitimate relationship to the contract between Veep

and B&L, Elliott was a "participant" to the contract in accordance with

our supreme court's definition of "participant" in Waddell and,

accordingly, Elliott could not be accused of interfering with that contract.

Waddell, supra. To the extent Veep argues that Elliott did not have

control over the parameters of the work performed on the Lamar project

and had no role in the bidding process, we note that, in Waddell, our

supreme court rejected an argument "that one can be considered a

stranger to the relationship if one does not effectively control

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performance under the contract" as "too narrow." 875 So. 2d at 1157.

Thus, we cannot agree with Veep that Elliott's role as a "mere supplier"

requires a determination that Elliott was a stranger to the business

relationship between Veep and B&L.

Because, under the circumstances in the present case, Veep failed

to establish that Elliott was a stranger to the relationship with which it

allegedly interfered, Elliott cannot be liable for interference with that

relationship. Accordingly, we reverse the trial court's judgment insofar

as it found in favor of Veep on its claim of tortious interference with a

business or contractual relationship, and we remand the case for the

entry of a judgment on this claim in favor of Elliott. Having concluded

that Veep failed to meet the element of its claim for interference with a

business or contractual relationship that Elliott must be a stranger to the

relationship, we decline to address Elliott's remaining arguments on

appeal related to Veep's purported failure to prove additional elements of

that same claim. To the extent that Elliott requests in the conclusion to

its brief on appeal that this court direct the trial court to "enter judgment

in Elliott's favor as to Elliott's affirmative claims in this case," we note

that Elliott failed to assert any argument before this court related to the

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denial of its counterclaims; accordingly, any such arguments are waived,

and we decline to further address Elliott's request for relief related to its

counterclaims against Veep. See Gary v. Crouch, 923 So. 2d 1130, 1136

(Ala. Civ. App. 2005) ("[T]his court is confined in its review to addressing

the arguments raised by the parties in their briefs on appeal; arguments

not raised by the parties are waived.").

REVERSED AND REMANDED WITH INSTRUCTIONS.

Moore, P.J., and Edwards, Fridy, and Lewis, JJ., concur.

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