Auto-Owners Insurance Company v. Tomberlin, Young & Folmar Insurance Co. et al

Filing 148

MEMORANDUM OPINION AND ORDER directing that (1.) The 112 Motion for Summary Judgment is DENIED as to the voluntary payment rule and statute of limitations grounds asserted in the Motion; (2.) The Plaintiff is given until June 29, 2012 to file a sho rt supplemental brief addressing Auto-Owners' contentions that John Tomberlin's representations/suppressions regarding the letter of credit issued to Smith in 2006 has not been alleged as a separate claim in the Amended Complaint, and the c ontention that the claims in Counts I and II of the Amended Complaint are limited to claims based on Michael Smith's failing to obtain bonding on subcontracts, and not any other financial issues of Michael Smith and his company which existed before the bond was issued by Auto-Owners, as further set out. Signed by Honorable Judge W. Harold Albritton, III on 6/14/12. (scn, )

IN THE UNITED STATES DISTRICT COURT FOR
THE MIDDLE DISTRICT OF ALABAMA
NORTHERN DIVISION

AUTO-OWNERS INSURANCE COMPANY, )
)
Plaintiff,
)
)
v.
)
)
TOMBERLIN, YOUNG & FOLMAR
)
INSURANCE CO. d/b/a SOUTH CENTRAL )
AGENCY, JOHN S. TOMBERLIN, and
)
HAROLD W. YOUNG,
)
)
Defendants.
)
___________________________________
)
TOMBERLIN, YOUNG & FOLMAR
)
INSURANCE CO. d/b/a SOUTH CENTRAL )
AGENCY, JOHN S. TOMBERLIN and
)
HAROLD W. YOUNG
)
)
Counterclaimants
)
)
v.
)
)
AUTO-OWNERS INSURANCE COMPANY, )
)
Counterclaim Defendant
)

CASE NO. 2:11-cv-468-WHA
(wo)

MEMORANDUM OPINION AND ORDER
I. INTRODUCTION
This cause is before the court on the Motion for Summary Judgment on all Claims and
Counterclaims, filed by Defendants/Counterclaimants John S. Tomberlin; Tomberlin, Young &
Folmar Insurance Co.; and Harold W. Young (Doc. #112). The court has jurisdiction based on
diversity of citizenship.
This case began with a Complaint filed in the Northern District of Florida by the United

States of America against the Dick Corporation and others. United States, etc. v. Dick Corp., et.
al., 3:08cv56/MCR/MD. In July 2010, a Fourth-Party Complaint was filed by Auto-Owners
Insurance Company ("Auto-Owners") against Tomberlin, Young & Folmar Insurance Company
d/b/a South Central Agency, John S. Tomberlin and Harold S. Young (collectively "the
Tomberlin Defendants"). Auto-Owners and the Tomberlin Defendants jointly stipulated to a
transfer of the action to the United States District Court for the Middle District of Alabama.
After the case was transferred to this court, the Tomberlin Defendants filed an Answer.
Auto-Owners then filed an Amended Complaint,1 with leave of court. Auto-Owners brings
claims for breach of contract (Count I), breach of fiduciary duty during the application process
(Count II), breach of fiduciary duty following the application process (Count III),
indemnification (Count IV), negligent misrepresentation (Count V), and suppression of material
facts (Count VI).
The Tomberlin Defendants Amended their Answer in response to the Amended
Complaint, and included counterclaims. They then moved to dismiss the Complaint, or in the
alternative, for judgment on the pleadings. This court denied the motion without prejudice to the
issues raised in the motion being raised again in a properly-filed Motion for Summary Judgment
The Tomberlin Defendants have moved for summary judgment as to all claims against
them, and as to their counterclaims against Auto-Owners. The court held oral argument on the
pending motion on May 17, 2012.
In moving for summary judgment, the Tomberlin Defendants have re-asserted two

1

The complaint is labeled the First Amended Complaint, but there was a First Amended
Complaint filed before the case was transferred to this court. See Doc. #11. Therefore, the court
will refer to the most recent complaint as the Amended Complaint.
2

arguments which were raised in their Motion to Dismiss, and which apply to multiple counts in
the Complaint. This Memorandum Opinion and Order addresses those arguments.

II. SUMMARY JUDGMENT STANDARD
Summary judgment is proper "if there is no genuine issue as to any material fact and . . .
the moving party is entitled to a judgment as a matter of law." Celotex Corp. v. Catrett, 477 U.S.
317, 322 (1986).
The party asking for summary judgment "always bears the initial responsibility of
informing the district court of the basis for its motion,” relying on submissions “which it believes
demonstrate the absence of a genuine issue of material fact." Id. at 323. Once the moving party
has met its burden, the nonmoving party must “go beyond the pleadings” and show that there is a
genuine issue for trial. Id. at 324.
Both the party “asserting that a fact cannot be,” and a party asserting that a fact is
genuinely disputed, must support their assertions by “citing to particular parts of materials in the
record,” or by “showing that the materials cited do not establish the absence or presence of a
genuine dispute, or that an adverse party cannot produce admissible evidence to support the
fact.” Fed. R. Civ. P. 56 (c)(1)(A),(B). Acceptable materials under Rule 56(c)(1)(A) include
“depositions, documents, electronically stored information, affidavits or declarations,
stipulations (including those made for purposes of the motion only), admissions, interrogatory
answers, or other materials.”
To avoid summary judgment, the nonmoving party "must do more than show that there is
some metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co. v. Zenith Radio

3

Corp., 475 U.S. 574, 586 (1986). On the other hand, the evidence of the nonmovant must be
believed and all justifiable inferences must be drawn in its favor. See Anderson v. Liberty Lobby,
477 U.S. 242, 255 (1986).
After the nonmoving party has responded to the motion for summary judgment, the court
shall grant summary judgment if the movant shows that there is no genuine dispute as to any
material fact and the movant is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a).
III. FACTS
The facts, taken in a light most favorable to the nonmovant, are as follows:
Plaintiff Auto-Owners is an insurance and surety company. Among other tasks, AutoOwners issues performance and payment bonds related to construction projects. In September of
2005, Auto-Owners provided South Central Agency, an independent insurance and bonding
agency in Andalusia, Alabama, a contract to solicit surety bonds on behalf of Auto-Owners.
South Central Agency was owned and operated by John Tomberlin ("Tomberlin") and Harold
Young ("Young") (collectively referred to as "the Tomberlin Defendants"). The Tomberlin
Defendants had previously entered into a contract with Auto-Owners to solicit policies of
insurance.
The September 2005 agreement between Auto-Owners and the Tomberlin Defendants
included a Letter of Instructions which authorized the Tomberlin Defendants to solicit bonding
business if, after a thorough investigation, they were satisfied that it was a proper risk for AutoOwners to assume.
Michael Smith ("Smith") approached the Tomberlin Defendants about a surety bond on a
construction subcontract in Pensacola, Florida. His company, S&S, signed on to perform four

4

subcontracts at the Naval Air Station in Pensacola for a total of $9,402,964. Dick Corporation
was the general contractor on the project. Shelby Gardner ("Gardner") is the CEO of Dick
Corporation.
S&S had started work at the Naval Air Station in May of 2006 on two of the subcontracts
with Dick Corporation.
The Tomberlin Defendants began attempting to obtain a bond for S&S through AutoOwners, and in June 2006, in an effort to secure the bonding, S&S sought a letter of credit.
Tomberlin sent an email to Auto-Owners in June 2006 stating that a letter would come from the
bank confirming that $2,000,000.00 in credit was available to S&S. S&S received a $1 million
line of credit, which was exhausted by November 2006.

Jim House, the bond underwriting

manager for Auto-Owners, stated in his deposition that in December 2006, Tomberlin told him
that S&S had a $2 million line of credit and that none of the line had been used. (Doc. # 119-8 at
p. 282: 10-13). Auto-Owners issued a performance bond and a payment bond to S&S for a
subcontract with Dick Corporation in January 2007.
The parties dispute whether at the time of the issuance of the bond in January of 2007,
S&S was in default with the Dick Corporation on other subcontracts. The parties are in
agreement, however, that S&S had not been declared in default by Dick at that time.
Tom Froman ("Froman"), Auto-Owners Vice President, testified in his deposition that
during the October 2009 deposition of Gardner, Dick Corporation’s CEO, in the Florida case,
Gardner mentioned that there was a meeting which occurred with Gardner, and Defendants
Smith and Tomberlin, in August 2007, during which Gardner was ready to declare S&S in
default, and intended to so-notify Auto-Owners, but based on Tomberlin's assurances and

5

urgings, Gardner did not. (Doc. #129-9 at pages 28-29). Auto-Owners states that it first learned
of the Tomberlin Defendants' conduct during the deposition of Gardner.
Ten months after the bond was issued, in October of 2007, Auto-Owners was provided
with a written notice of a potential claim and attempt to formally declare a default on the bonds,
when Auto-Owners received a 72 hour notice to cure from Dick Corporation. There was no
attempt to cure the default. On October 19, 2007, Dick Corporation formally declared a default
on the bond and sent Auto-Owners a notice of the claim.
Auto-Owners was sued by Dick Corporation on the performance bond that Auto-Owners
had issued in United States, etc. v. Dick Corp., 3:08cv56/MCR/MD. After several years of
litigation, Auto-Owners settled with Dick Corporation, with a mediator determining the amount
Auto-Owners had to pay on the bond.
IV. DISCUSSION
The two grounds for summary judgment which this court will address in this
Memorandum Opinion and Order are the voluntary payment rule and the statute of limitations.
A. The Voluntary Payment Rule
The Tomberlin Defendants argued in an earlier-filed Motion to Dismiss or for Judgment
on the Pleadings that this case is barred by the voluntary payment rule. The Amended
Complaint seeks an amount of $1,156,000, which is the amount paid to Dick Corporation in
settlement of Dick Corporation's claim on the bond, as well as expenses incurred during and
prior to the Dick Corporation litigation. See Amended Complaint at ¶ 19. In its brief in
opposition to the motion, Auto-Owners stated that in addition to the payment on the performance
bond to Dick Corporation, as obligee, Auto-Owners had smaller losses on the labor and material

6

payment bond because it had to pay suppliers money owed to them by S&S. (Doc. #85 at pages
25-26). Based in part on the allegation, and representation in brief, that there were losses other
than the amounts paid in settlement, the court denied the motion without prejudice to the
voluntary payment defense being raised in a motion for summary judgment. (Doc. #96 at p.4).
In support of their Motion for Summary Judgment, the Tomberlin Defendants have cited
the deposition testimony of Froman in which he confirmed that there were no claims paid under
the payment bond. Auto-Owners does not appear to cite any evidence contrary to this testimony
by Froman. Now that there has been factual development in the case, therefore, it appears that
the parties are in agreement that the "expenses incurred during and prior to the Dick Corporation
litigation" does not include payment on any payment bond, and are actually the "attorneys' fees
and other litigation costs . . . [which] arose in the Dick litigation." (Doc. #119 at p. 35).
Furthermore, although Auto-Owners has asserted both contract and tort claims in this case, it
appears that the measure of damages Auto-Owners seeks in this case for all of its claims is the
losses incurred from issuance of the bond, ie., the settlement payment to the Dick Corporation,
and the attorneys' fees and costs incurred during the Dick Corporation litigation. It is that
amount, therefore, which the Tomberlin Defendants claim cannot be recovered under the
voluntary payment rule. The Tomberlin Defendants also have now argued that, to the extent that
the voluntary payment doctrine is limited to the amounts actually paid in a voluntary settlement,
a claim for litigation costs is precluded under Alabama law, citing Harley-Davidson of Mobile,
Inc. for Use and Ben. of Universal Underwriters Ins. Co., 435 So. 2d 1308, 1309 (Ala. Civ. App.
1983).
Auto-Owners argues that the voluntary payment doctrine does not apply in this case, and

7

that attorneys' fees are recoverable.
In deciding the issues raised by the parties, the court has considered the briefs, oral
argument, and evidence cited in support of and opposition to the motion for summary judgment,
as well as the earlier-filed briefs in support of and in opposition to the Motion to Dismiss.
The voluntary payment rule is that "where one party, with full knowledge of all the facts,
voluntarily pays money to satisfy the colorable legal demand of another, no action will lie to
recover such a voluntary payment, in the absence of fraud, duress, or extortion." Mt. Airy Ins.
Co. v. The Doe Law Firm, 668 So. 2d 534 (Ala. 1995). The facts of Mt. Airy involved an
attempt to recover settlement payments made under an indemnity, not subrogation theory, in
which the insurer paid amounts in settlement of third party claims without the consent of the
insured or a judgment. Id. at 538. The case has not, however, been limited to that context. See,
e.g., U-Haul Co. of Alabama, Inc. v. Johnson, 893 So. 2d 307 (Ala. 2004) (remanding case for
analysis of Mt. Airy voluntary payment rule in a case involving overcharges of sales tax).
In opposing summary judgment, Auto-Owners relies on RSUI Group, Inc. v. Willis of
Alabama, Inc., No. 07-0142-WS-B, 2007 WL 2469571 (S.D. Ala. Aug. 29, 2007). In that case,
the voluntary payment rule did not apply because an insurance agent caused the insurer to be
legally obligated to pay under an insurance policy by failing to include a particular exclusion in
the insurance binder as he had been instructed. Id. at *1. The court reasoned that it would make
little sense to hold that a party with an "inescapable obligation, wrongfully created by another, to
pay an innocent third party forfeits all right to be made whole by the wrongdoer if he honors that
obligation." Id. The court explained that even if Alabama law would recognize such a principle,
the defendant in that case had not met its burden in demonstrating that the principle exists. Id.

8

The court's conclusion was that Mt. Airy did not apply under the facts when there was a legal
obligation to pay. See id.
This court has had occasion to examine the applicability of RSUI Group, Inc. to thirdparty payments. See Greyhound Lines, Inc. v. Goodyear Tire & Rubber Co., 3:08cv516, 2009
WL 3079198 (M.D. Ala. Sept. 23, 2009). In that case, the court concluded that RSUI Group.,
Inc. was distinguishable because the bus company which sought recovery of payments it had
made to passengers had no legal obligation to pay the third-party passengers who had been
injured in a bus accident which was allegedly caused by a defective tire manufactured by the
defendant. Id. at *6.
In the instant case, Auto-Owners has argued that it had a legal obligation to pay Dick
Corporation on the bonds, and only entered into a settlement as to the amount that would be
paid. Auto-Owners contends that the Tomberlin Defendants were parties in the Dick
Corporation suit, and were provided court notice that Auto-Owners was settling its claim with
Dick Corporation.
The Tomberlin Defendants, while acknowledging that Auto-Owners had an obligation
under the bond, stated during oral argument that Auto-Owners could have satisfied its obligation
without making the payment it made to Dick Corporation by, for instance, hiring another
contractor to complete the project. The Tomberlin Defendants also argued that Auto-Owners
could have paid the bond without engaging in litigation and incurring that expense. The
Tomberlin Defendants state that this court should distinguish this case from RSUI Group, Inc.,
because the Tomberlin Defendants did not violate specific instructions from Auto-Owners.
This case is distinct from the facts presented in Mt. Airy and in Greyhound Lines, Inc. In

9

this case, under Auto-Owners' theory, viewing the facts in a light most favorable to the
nonmovants, the Tomberlin Defendants' failure to perform duties as soliciting agents for the
bond caused Auto-Owners to be legally obligated to pay for S&S's default through a bond AutoOwners would not have issued but for the Tomberlin Defendants' actions. See Phillip G. Alber,
Making Sense Out of Performance and Payment Bonds, 71 Mich. B.J. 1020, 1021 (1992) (stating
that "[o]nce issued, the bond cannot be cancelled or rescinded even if it was obtained by fraud.
Since the owner has relied upon the bond in issuing the contract, the surety cannot unilaterally
cancel the bond to the detriment of the obligee."). The Tomberlin Defendants have not cited
any authority, and the court is not aware of any, in which the voluntary payment rule has been
applied by Alabama courts to a case presenting the facts of the instant case. Finding no
authority in Alabama law to apply the voluntary payment rule under these facts, and in light of
the persuasive authority, RSUI Group Inc., which applied Alabama law and found that the
voluntary payment rule did not apply where there was a legal obligation to pay, the court
concludes that the voluntary payment defense has not been demonstrated to preclude AutoOwners' claims against the Tomberlin Defendants in this case. The Motion for Summary
Judgment is due to be DENIED to the extent that it rests on the voluntary payment rule.2
B. Statute of Limitations
The Tomberlin Defendants have argued that the statute of limitations bars Auto-Owners'
breach of fiduciary duty claims in Counts II and III, negligent representation claim in Count V,

2

As to the additional argument that litigation expenses are not recoverable under the
American Rule, or under Alabama law, having found that the involuntary payment rule does not
preclude Auto-Owners' claims entirely, that issue is one of damages, and can be raised in a
motion in limine before trial.
10

and suppression claim in Count VI of the Amended Complaint The Tomberlin Defendants
contend that the claims filed in 2010 arose from conduct in 2006 and 2007.
Auto-Owners' position in its Amended Complaint, and in response to the Motion for
Summary Judgment, is that it was not aware of the Tomberlin Defendants' conduct until the
deposition of Dick Corporation CEO Gardner in the Florida case. As stated earlier, Froman
testified in that deposition that Gardner was ready to declare S&S in default in August of 2007,
and intended to so-notify Auto-Owners, but based on Tomberlin's assurances and urgings,
Gardner did not. (Doc. #129-9 at pages 28-29). Auto-Owners states in its brief that it had
thought that the fact of S&S's difficulties in performing its contract were a surprise to the
Tomberlin Defendants, but discovered otherwise during Gardner's deposition in the Dick
Corporation litigation. Auto-Owners contends that just because it became aware of the S&S
default at an earlier point does not also mean that it should have been aware of the conduct of its
soliciting agents.
The statute of limitations begins to run when a plaintiff has “such knowledge ... sufficient
to provoke inquiry in reasonable minds which would have led to the facts on which the claims in
this action are based.” Robbins v. Sanders, 890 So.2d 998, 1012 (Ala. 2004) (citing Jefferson
County Truck Growers Ass'n v. Tanner, 341 So.2d 485, 488 (Ala.1977)). This question is
generally one for the jury. See Cork v. Marriott Intern., Inc., 426 F. Supp. 2d 1234, 1239 (N.D.
Ala. 2006).
In their initial Motion to Dismiss, the Tomberlin Defendants relied on Alabama case law
which holds that the statute of limitations begins to run when a party has facts that should have
provoked inquiry in the mind of a reasonable person, not when the party has actual knowledge of

11

injury. See Auto-Owners Ins. Co. v. Abston, 822 So. 2d 1187 (Ala. 2001) (stating that statute of
limitations began to run where insured was provided written letter which would have led a
reasonable person to investigate the intent of its insurer to pay a third-party). Therefore, the
court agrees with the Tomberlin Defendants that Auto-Owners' evidence as to when it states it
acquired knowledge of conduct by the Tomberlin Defendants is not necessarily dispositive. It is,
however, the Tomberlin Defendants' burden, in moving for summary judgment, to show as a
matter of law that the statute of limitations ran more than two years before the filing of the
Complaint.
The Tomberlin Defendants have pinpointed several dates and have argued that, assuming
that alleged misstatements were made as alleged by Auto-Owners, the statute of limitations
began to run on one of these dates. The court takes each one of these in turn.
August, 15, 20063--The Tomberlin Defendants state that on August 15, 2006,
Tomberlin's first representation was shown to be false when the line of credit for $1,000,000 for
S&S came through, because it was half of what Tomberlin promised Auto-Owners.4

3

It is not entirely clear to the court why the date August 15, 2006 was chosen, but it
appears that that is the actual date that the line of credit was available. It is not clear, however,
that Auto-Owners would have had any notice that the line of credit was available as of that date.
4

The Tomberlin Defendants state that this representation was not alleged in the Amended
Complaint as a statement which forms the basis of any claims. (Doc. #122 at p.7 n.5). The
Tomberlin Defendants argue that Auto-Owners' responsibility to look into what was being
provided by the Tomberlin Defendants was nevertheless triggered on that date. The court will
address in a separate Memorandum Opinion and Order to be filed on a later date the issue of
whether the representation by Tomberlin has been alleged as a separate claim, as well as the
contention by the Tomberlin Defendants that the claims in Counts I and II of the Amended
Complaint are limited to claims based on Smith's failing to obtain bonding on subcontracts, and
not any other financial issues of Smith. To aid in that determination, the court will give AutoOwners an opportunity to file a short supplemental brief that addresses those issues.
12

The sequence of events leading up to that date began in June 2006. Tomberlin sent an
email to Auto-Owners in June 2006 stating that a letter would come from the bank confirming
that $2,000,000.00 was available. The Tomberlin Defendants have attached to their reply brief
a letter dated July 10, 2006 in which Kelly Baxter of the People's Bank wrote a letter to Jim
House of Auto Owners which states that Smith had been approved for a line of credit in the
amount of $1,000,000.00 and that the bank was "willing to entertain new loan requests." (Doc.
#122 p. 15).
Auto-Owners has cited the deposition of Jim House in which he stated that he filled out a
document on December 18, 2006, and at that time he wrote that S&S had a two million dollar
bank line which had not been used, based on what Tomberlin told him in December 2006. (Doc.
#119-8 at p. 281: 14-23-282: 13).
Auto-Owners is bringing claims against the Tomberlin Defendants on the theory that they
induced Auto-Owners to issue the bond in January, 2007, and in so-doing failed to fulfill various
duties, that stemmed from the relationship between Auto-Owners and the Tomberlin Defendants,
not Auto-Owners and S&S. Specifically with respect to the line of credit, Tomberlin's
December representation to Auto-Owners as to the amount of credit available to S&S could be
viewed, in a light most favorable to the nonmovant, as being confirmation that S&S had a two
million dollar unused line at that time, and therefore, consistent with the June email and the July
bank letter as to the amount of credit. The court cannot conclude, therefore, that the statute of
limitations began to run on claims against the Tomberlin Defendants when the line became
available on August 15, 2006. Cf. Ex parte Alabama Farmers Co-op., Inc., 911 So. 2d 696,
702 -703 (Ala. 2004) (stating that the "statute of limitations is tolled as to a fraud claim if, after

13

discovery of the fraudulent act and inquiry, the plaintiff is misinformed or falsely informed by
the defendant and the plaintiff reasonably relies on the defendant's misrepresentation.").
December 1, 2006 and March 30, 2007 are the dates that Auto-Owners sent Smith
notices of cancellation of his company's insurance policies which had been issued by AutoOwners. While the court agrees with the Tomberlin Defendants that it would seemingly be
problematic to argue that Auto-Owners did not know that it itself had cancelled insurance for
lack of sufficient funds, that evidence only appears to relate to a duty to inquire as to S&S's
deficiencies in paying for its insurance, and not Auto-Owners' duty to inquire as to the
Tomberlin Defendants' conduct, particularly with respect to the Tomberlin Defendants' actions
before the bonds were issued.5 The court cannot conclude, therefore, as a matter of law that the
statute of limitations for claims against the Tomberlin Defendants began to run on those dates.
The period prior to October 19, 2007 is stated by the Tomberlin Defendants to be the
period during which Auto-Owners failed to receive replies from Dick Corporation to its inquiries
about the status of the project. While not receiving replies from Dick Corporation could have
alerted Auto-Owners to an issue with S&S's performance of the construction contract, it has not
been shown to provoke inquiry as a matter of law as to the Tomberlin Defendants'
representations or actions.
October 15, 2007 is the date Auto-Owners received a notice to cure from Dick
Corporation. Clearly, this evidence demonstrates that inquiry would have been provoked into
the circumstances of S&S's performance of its contract with the Dick Corporation, but the court

5

It does not appear to the court that Auto-Owners has attempted to claim, as the
Tomberlin Defendants assert, that the Tomberlin Defendants should have informed Auto-Owners
that Auto-Owners had cancelled its policies with Smith as a separate basis for relief.
14

cannot conclude as a matter of law that this notice would have alerted a reasonable surety that its
soliciting agent had breached any duties to it.
October 19, 2007 is the date of default. Again, this date appears relevant to the
knowledge of S&S's deficiencies, but not the Tomberlin Defendants' alleged improper actions.
December 2007--the Tomberlin Defendants state that this is the date Auto-Owners hired
accountants and established a loss reserve. Auto-Owners responds that the hiring of the
accountant was to investigate payment practices and to allocate payments among the four
subcontracts, one of which was covered by its performance bond, and that this did not involve
the Tomberlin Defendants. The court agrees that the evidence, viewed in a light most favorable
to the nonmovant, does not establish as a matter of law that Auto-Owners should have
investigated the Tomberlin Defendants as of this date.
It may be that a jury will ultimately determine that Auto-Owners reasonably should have
inquired into the circumstances regarding the Tomberlin Defendants' actions at a point which is
earlier than two years prior to the filing of the claims in this case. However, the evidence
presented by the Tomberlin Defendants, viewed in a light most favorable to the nonmovant, does
not establish as a matter of law that the statute of limitations began to run on any of the dates
identified by the movants. Because the burden of proof is on the Defendants, summary
judgment is due to be DENIED as to the defense of the statute of limitations.
IV. Conclusion
For the reasons discussed, it is hereby ORDERED as follows:
1. The Motion for Summary Judgment (Doc. #112) is DENIED as to the voluntary
payment rule and statute of limitations grounds asserted in the Motion.

15

2. The Plaintiff is given until June 29, 2012 to file a short supplemental brief addressing
Auto-Owners' contentions that John Tomberlin's representations/suppressions regarding the
letter of credit issued to Smith in 2006 has not been alleged as a separate claim in the Amended
Complaint, and the contention that the claims in Counts I and II of the Amended Complaint are
limited to claims based on Michael Smith's failing to obtain bonding on subcontracts, and not
any other financial issues of Michael Smith and his company which existed before the bond was
issued by Auto-Owners. See Gilmour v. Gates, McDonald and Co., 382 F.3d 1312, 1315 (11th
Cir. 2004) (stating that a plaintiff may not amend a complaint through argument in a brief
opposing summary judgment).
The court will rule on other grounds for summary judgment asserted in the motion in a
separate Memorandum Opinion and Order to be entered at a later date.
Done this 14th day of June, 2012.

/s/ W. Harold Albritton
W. HAROLD ALBRITTON
SENIOR UNITED STATES DISTRICT JUDGE

16