Harper v. O'Charley's, LLC

Filing 35

Order granting in part denying in part 26 MOTION to Dismiss Defendant O'Charley's, LLC Third-Party Complaint filed by Neel-Schaffer, Inc. Answer to Third-Party Complaint due from Neel-Schaffer, Inc. on 12/4/2017. Signed by District Judge William H. Steele on 11/20/2017. (tgw)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION
DIANE HARPER,
Plaintiff,
v.
O’CHARLEY’S, LLC,
Defendant/Third-Party Plaintiff,
v.
NEEL-SCHAFFER, INC.,
Third-Party Defendant,

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CIVIL ACTION 16-0577-WS-M

ORDER
This matter comes before the Court on the Motion to Dismiss (doc. 26) filed by thirdparty defendant, Neel-Schaffer, Inc. The Motion has been briefed and is now ripe for
disposition.
I.

Background.
This action arises from an incident that occurred on January 29, 2015 in the parking lot of

the O’Charley’s restaurant on Airport Boulevard in Mobile, Alabama. After dining at the
restaurant, plaintiff, Diane Harper, was walking outside and stepped from the sidewalk onto the
curb ramp adjacent to her car, which was parked in an accessible parking space. As she did so,
Harper fell to the ground and incurred certain personal injuries. In her Complaint, Harper
attributes her fall and associated injuries to “the abrupt change in level between the sidewalk and
the side of the ramp, as well as the excessive narrowness of the ramp itself and the location of the
ramp in the access aisle adjacent to the accessible parking space.” (Doc. 1, ¶ 5.) Based on these
allegations, Harper’s Complaint asserts claims against defendant, O’Charley’s, LLC, for
violation of the public accommodation provisions of the Americans with Disabilities Act, 42
U.S.C. §§ 12101 et seq. (“ADA”), and for negligence / negligence per se, all based on alleged

defects in the design, construction, and/or maintenance of the curb ramp in the parking lot of the
O’Charley’s restaurant where the fall took place. Among other things, Harper maintains that the
ramp was too steep and too narrow, that the change in level from sidewalk to ramp was too
abrupt, and that the access aisle to the accessible parking space was inadequate.
On September 20, 2017, O’Charley’s, with prior leave of court, filed its Third-Party
Complaint (doc. 18) against Neel-Schaffer. In this pleading, O’Charley’s alleges that it had
contracted with Neel-Schaffer in April 1996 for the latter “to perform certain engineering and
design services for a site development plan for the demolition, reconstruction and renovation of”
the restaurant where Harper was injured. (Doc. 18, ¶ 5.) O’Charley’s further alleges that NeelSchaffer’s site development plan for that location was deficient because it “did not contain any
detail, instructions or design for the access ramps to the O’Charley’s parking lot,” and that “there
has been no additional work, repair or material alteration to the access ramps, sidewalks or
parking lot … since the time they were constructed in 1996 … pursuant to the plans provided by
Neel-Schaffer.” (Id., ¶¶ 7-8.) In light of these allegations, the Third-Party Complaint delineates
third-party claims against Neel-Schaffer for both contractual indemnification (predicated on a
written agreement in which Neel-Schaffer promised to indemnify O’Charley’s) and common-law
indemnification.
Several provisions of the April 1996 agreement between O’Charley’s and Neel-Schaffer
are of particular relevance to the pending Motion to Dismiss.1 The key portion of the indemnity
1

The terms of that agreement are not recited in the Third-Party Complaint.
Ordinarily, litigants may not rely on facts outside the pleadings for purposes of a Rule 12(b)(6)
motion. See, e.g., Keating v. City of Miami, 598 F.3d 753, 762 (11th Cir. 2010) (in reviewing
Rule 12(b)(6) motion, court must “limit[] our review to the four corners of the complaint”);
Hayes v. U.S. Bank Nat’l Ass’n, 648 Fed.Appx. 883, 887 (11th Cir. Apr. 21, 2016) (“In
evaluating whether a complaint should be dismissed under Rule 12(b)(6) for failure to state a
claim, a court is generally limited to reviewing what is within the four corners of the
complaint.”) (citations and internal marks omitted). However, “the court may consider a
document attached to a motion to dismiss without converting the motion into one for summary
judgment if the attached document is (1) central to the plaintiff’s claim and (2) undisputed,” in
the sense that “the authenticity of the document is not challenged.” Day v. Taylor, 400 F.3d
1272, 1276 (11th Cir. 2005); Brooks v. Blue Cross and Blue Shield of Florida, Inc., 116 F.3d
1364, 1369 (11th Cir. 1997) (“where the plaintiff refers to certain documents in the complaint and
those documents are central to the plaintiff’s claim, then the Court may consider the documents
part of the pleadings for purposes of Rule 12(b)(6) dismissal”). In light of the contractual
indemnity claim asserted by O’Charley’s, it cannot reasonably be disputed that the contract
(Continued)
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clause reads as follows: “[Neel-Schaffer] shall indemnify and hold harmless [O’Charley’s] from
[O’Charley’s] loss or expense, including reasonable attorney’s fees for claims for personal injury
(including death) or property damage arising out of the sole negligent act, error or omission of
[Neel-Schaffer].” (Doc. 27, Exh. 1 at Exh. A, ¶ 14.) The April 1996 contract also included a
“governing law” provision stating as follows: “This Agreement shall be governed by and
construed in accordance with the laws of the principal place of business of [Neel-Schaffer].”
(Id., ¶ 27.) For purposes of this Motion, the parties agree that Neel-Schaffer’s principal place of
business is (and at all relevant times was) located in Mississippi.
II.

Analysis.
Neel-Schaffer’s Motion to Dismiss is grounded in what appears at first blush to be a

straightforward limitations argument.2 By the unambiguous terms of the Third-Party Complaint,
O’Charley’s is suing Neel-Schaffer for indemnity based on engineering and design services that
Neel-Schaffer performed in 1996, when Neel-Schaffer prepared a site development plan for
renovation of the premises where Harper fell in 2015. The Third-Party Complaint alleges that
Neel-Schaffer’s site development plan lacked detail, instructions or design for the access ramps
that Harper identifies as the cause of her injuries, and says that no work has been done on the
parking lot, sidewalks or access ramps since 1996 or shortly thereafter. Thus, by the clear terms

between those entities is central to O’Charley’s claims; moreover, O’Charley’s has not
questioned the authenticity of the contract attached as Exhibit 1 to Neel-Schaffer’s principal brief
on the Rule 12(b)(6) Motion. For these reasons, the Court deems it proper to consider the
written contract in adjudicating Neel-Schaffer’s Rule 12(b)(6) motion, and does so without
converting the motion into a summary judgment motion.
2

Of course, there are significant constraints on a defendant’s ability to litigate a
limitations defense at the pleadings stage. See, e.g., La Grasta v. First Union Securities, Inc.,
358 F.3d 840, 845 (11th Cir. 2004) (“A statute of limitations bar is an affirmative defense and
plaintiffs are not required to negate an affirmative defense in their complaint.”) (citation and
internal marks omitted). But a limitations defense may properly be pursued via Rule 12(b)
motion if the face of the complaint reveals an obvious timeliness defect. See, e.g., Boyd v.
Warden, Holman Correctional Facility, 856 F.3d 853, 872 (11th Cir. 2017) (“a Rule 12(b)(6)
dismissal on statute of limitations grounds is appropriate only if it is apparent from the face of
the complaint that the claim is time-barred.”) (citation omitted). Here, Neel-Schaffer’s Motion to
Dismiss proceeds on the theory that the limitations problem is apparent on the face of the ThirdParty Complaint; therefore, the argument is properly raised at this time.

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of the Third-Party Complaint, O’Charley’s seeks recovery from Neel-Schaffer in indemnity for
alleged deficiencies in services provided by Neel-Schaffer more than 18 years prior to Harper’s
injuries for which O’Charley’s now seeks indemnification.
According to Neel-Schaffer, these clear factual allegations in the Third-Party Complaint
require dismissal of O’Charley’s claims against it on timeliness grounds. In that regard, NeelSchaffer points to Alabama’s construction statute of repose. That statute generally provides for a
two-year limitations period from the time a cause of action accrues “against any architect or
engineer performing or furnishing the design, planning, specifications, testing, supervision,
administration or observation of any construction of any improvement on or to real property …
for the recovery of damages for” injury to a person caused by any deficiency in such design,
planning, specifications, and so on. Ala. Code § 6-5-221(a). More importantly for our purposes,
the statute goes on to state that
“Notwithstanding the foregoing, no relief can be granted on any cause of action
which accrues or would have accrued more than seven years after the substantial
completion of construction of the improvement on or to the real property, and any
right of action which accrues or would have accrued more than seven years
thereafter is barred, except where prior to the expiration of such seven-year
period, the architect, engineer, or builder had actual knowledge that such defect or
deficiency exists and failed to disclose such defect or deficiency to the person
with whom the architect, engineer, or builder contracted to perform such service.”
Ala. Code § 6-5-221(a) (emphasis added).
Neel-Schaffer’s argument presented in its Motion to Dismiss is simple. Alabama has a
seven-year statute of repose for engineering services relating to the design, planning or
specification of construction of improvements on real property. O’Charley’s has filed a ThirdParty Complaint bringing causes of action against Neel-Schaffer for alleged deficiencies in its
engineering services relating to the design of improvements on O’Charley’s property that were
performed in 1996, more than 18 years prior to the accrual of O’Charley’s claims against NeelSchaffer at the time of Harper’s fall in January 2015. Therefore, Neel-Schaffer posits, the ThirdParty Complaint is time-barred on its face pursuant to the seven-year statute of repose set forth at
§ 6-5-221(a), and must be dismissed under Rule 12(b)(6) for failure to state a claim upon which
relief can be granted.
In response to this straightforward argument, O’Charley’s offers an equally
straightforward counterargument. Specifically, O’Charley’s insists that § 6-5-221(a) does not
apply because its contractual indemnity claim against Neel-Schaffer is governed by Mississippi
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law, not by Alabama law.3 O’Charley’s argument relies on Paragraph 27 of the April 1996
contract. That provision is a “governing law” clause specifying that “[t]his Agreement shall be
governed by and construed in accordance with the laws of the principal place of business of the
Engineer,” which everyone agrees is Mississippi. On that basis, O’Charley’s insists that
Mississippi law, not Alabama law, governs its contractual indemnification claim predicated on
the April 1996 Agreement. Thus, O’Charley’s position is that the relevant limitations period
governing its contractual indemnification claim is supplied not by Alabama Code § 6-5-221(a),
but by Mississippi Code § 15-1-41. The Mississippi provision states, in relevant part, as follows:
“No action may be brought … for an injury to the person, arising out of any
deficiency in the design, planning, … or construction of an improvement to real
property, and no action may be brought for contribution or indemnity for
damages sustained on account of such injury except by prior written agreement
providing for such contribution or indemnity, against any person, firm or
corporation performing or furnishing the design, planning, … or construction of
such improvement to real property more than six (6) years after the written
acceptance or actual occupancy or use, whichever occurs first, of such
improvement ….”
Miss. Code § 15-1-41 (emphasis added). By the plain meaning of that statute, O’Charley’s
maintains, Mississippi law creates a six-year construction statute of repose for contribution or
indemnity claims, but exempts from that restriction cases in which there is a “prior written
agreement providing for such contribution or indemnity.” Because such a “prior written
agreement” exists as between it and Neel-Schaffer (in the form of the April 1996 contract),
O’Charley’s reasons that the six-year statute of repose is inapplicable and that its contractual
indemnification claim is therefore timely under governing Mississippi law.
Movant fires back with a series of counterarguments that vastly complicate the
straightforward discourse presented in the parties’ principal memoranda.4 As an initial matter,
3

Notably, O’Charley’s Response remains silent as to the timeliness of its commonlaw indemnity claim. There appears to be no dispute that the common-law claim is indeed
governed by Alabama law, in which case it is plainly time-barred under any reasonable
application of the § 6-5-221(a) statute of repose. O’Charley’s advances no argument otherwise.
4

Unfortunately, these counterarguments are nowhere to be found in NeelSchaffer’s principal brief. Even though the question of whether Mississippi’s or Alabama’s
construction statute of repose applies is the obvious focal point of dispute here, Neel-Schaffer
elected to address it only via footnote in its principal brief, and there in only the most skeletal of
terms. (Doc. 27, at 4 n.2.) Then, after O’Charley’s predictably made the Mississippi statute the
(Continued)
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Neel-Schaffer insists that Paragraph 27 of the April 1996 contract does not reach O’Charley’s
contractual indemnity claim because Paragraph 27 does not specify that Mississippi law governs
any claims arising out of that agreement, but instead says only that Mississippi law governs the
agreement itself. (See doc. 34, at 5.) This distinction is not persuasive.5 To be sure, case law is
legion for the proposition that a choice of law clause stating only that the agreement is governed
by a particular state’s laws – as contrasted with one providing that all claims and disputes arising
under the agreement are governed by that state’s laws – does not reach tort claims. See, e.g.,
Cooper v. Meridian Yachts, Ltd., 575 F.3d 1151, 1162 (11th Cir. 2009) (“In determining whether
a choice of law clause contained in a contract between two parties also governs tort claims
between those parties, a court must first examine the scope of the provision. … A choice of law
provision that relates only to the agreement will not encompass related tort claims.”) (citations
omitted); Green Leaf Nursery v. E.I. DuPont De Nemours and Co., 341 F.3d 1292 (11th Cir.
2003) (citing authorities for proposition that choice of law clause specifying that contract was
governed by law of a particular state was not broad enough to control claims arising in tort). But
O’Charley’s has brought a contractual indemnity claim against Neel-Schaffer. As a matter of
logic and common sense, the breadth and scope of Neel-Schaffer’s contractual duty to indemnify
O’Charley’s pursuant to Paragraph 14 (including any temporal restrictions on that duty) fall
squarely within the parameters of the choice of law provision found at Paragraph 27. Stated
differently, Neel-Schaffer made a promise in Paragraph 14 to indemnify O’Charley’s from loss

centerpiece of its Response (doc. 32) in opposition to the Motion to Dismiss, Neel-Schaffer
devoted its entire Reply (doc. 34) to reeling off one superficial, underdeveloped counterargument
after another, all when it was too late for O’Charley’s to be heard in response and with the effect
of shifting the burden to the Court to sift through myriad fragmentary and sometimes misleading
statements of law set forth in the Reply. The analysis herein is colored in part by the disfavored
nature of movant’s briefing approach.
5

Of course, “[w]here there is no indication that the terms of the contract are used
in a special or technical sense, they will be given their ordinary, plain, and natural meaning.”
Once Upon a Time, LLC v. Chappelle Properties, LLC, 209 So.3d 1094, 1097 (Ala. 2016)
(citation omitted). “General contract law requires a court to enforce an unambiguous, lawful
contract, as it is written. … A court may not make a new contract for the parties or rewrite their
contract under the guise of construing it.” Public Bldg. Authority of City of Huntsville v. St. Paul
Fire and Marine Ins. Co., 80 So.3d 171, 180 (Ala. 2010) (citations omitted). This discussion
proceeds in recognition of these fundamental principles.

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or expense for personal injury arising out of Neel-Schaffer’s negligent acts, errors or omissions.
By a plain reading of Paragraph 27, that promise to indemnify (which O’Charley’s is seeking to
enforce here) is governed by Mississippi law; thus, claims based on breach of that promise are
properly controlled by Mississippi law, as well.6
Next, Neel-Schaffer objects that O’Charley’s reliance on the choice of law provision
found in Paragraph 27 “completely disregards Alabama’s established conflict-of-laws
procedure.” (Doc. 34, at 2.) There is a good reason for that. Where an enforceable contractual
choice of law provision exists, courts typically do not analyze the forum state’s conflict-of-laws
rules. See, e.g., Green Leaf, 341 F.3d at 1301 (“Because the choice-of-law provision is narrow
[and inapplicable] …, we turn to the choice-of-law rules of the forum state, Florida, to determine
the applicable law governing the Plaintiffs’ tort claims.”); Stovall v. Universal Const. Co., 893
So.2d 1090, 1102 (Ala. 2004) (“In a contractual dispute, Alabama law would have us first look
to the contract to determine whether the parties have specified a particular sovereign’s law to
govern.”); Cherry, Bekaert & Holland v. Brown, 582 So.2d 502, 507 (Ala. 1991) (“parties
normally are allowed to choose another state’s laws to govern an agreement”); DJR Associates,
LLC v. Hammonds, 241 F. Supp.3d 1208, 1220 (N.D. Ala. 2017) (“Alabama law has long
recognized the right of parties to an agreement to choose a particular state’s laws to govern an
6

Neel-Schaffer’s argument places more weight on Cooper and Green Leaf than
they can bear. Nowhere in those decisions – or any other cases cited by Neel-Schaffer – does the
Eleventh Circuit deem a choice of law provision relating only to the agreement as failing to reach
contract-based claims arising from that agreement. Such an interpretation would essentially read
the choice of law provision out of existence. Not surprisingly, Neel-Schaffer fails to identify a
single case in which any court has declared that a choice of law provision stating that a contract
will be governed by the law of a particular state is inapplicable to contract-based claims under
that agreement unless the choice of law clause employs talismanic language about “claims
arising out of the agreement.” There is case law to the contrary. See, e.g., American Steamship
Owners Mut. Protection and Indem. Ass’n, Inc. v. Dann Ocean Towing, Inc., 756 F.3d 314, 319
(4th Cir. 2014) (“The plain language of the contract before us unambiguously provides that the
contract shall be ‘governed by’ New York law. This phrase clearly signals the parties’ intent that
… New York law will be applied as ‘governing’ the timeliness of claims asserted under the
contract. Because the claims at issue in this case are contractual in nature …, the parties’ choiceof-law clause amply encompasses the present claims.”); Huntsville Golf Development, Inc. v.
Estate of Brindley, 2015 WL 5693608, *6 (N.D. Ala. Sept. 29, 2015) (where choice of law
provision states that “[a]greement shall be governed by … the laws of the State of Tennessee,”
that provision “governs only HGD’s contract-based claims against the Brindley Estate”).

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agreement. … If the parties have not selected a particular state’s law, the law of the state where
contract was made applies.”) (citation omitted); SE Property Holdings, LLC v. Sandy Creek II,
LLC, 954 F. Supp.2d 1322, 1335 (S.D. Ala. 2013) (“[I]n Alabama, contract claims are governed
by the laws of the state where the contract was made, unless the contracting parties chose a
particular state’s laws to govern their agreement.”). Because Alabama law generally requires
courts to look to the subject contract and to honor the parties’ expressed intentions as to which
state’s law controls, the Court rejects Neel-Schaffer’s unsupported assertion that Alabama’s
conflict-of-law principles automatically trump Paragraph 27.7

7

In its reply brief, Neel-Schaffer argues for the first time that under Alabama’s
general conflict-of-law rules, statutes of limitations are viewed as procedural rather than
substantive, such that Alabama law forbids application of the Mississippi limitations period here.
(Doc. 34, at 3.) This argument could and should have been raised in movant’s principal brief and
is therefore inappropriate for a reply. See, e.g., SE Property Holdings, LLC v. Saint Family
Limited Partnership, 2017 WL 1628898, *7 n.14 (S.D. Ala. May 1, 2017) (“As a threshold
matter, this argument is improper because defendants raised it for the first time in a reply.”);
Brown v. CitiMortgage, Inc., 817 F. Supp.2d 1328, 1332 (S.D. Ala. 2011) (“New arguments
presented in reply briefs are generally not considered by federal courts.”) (citations omitted). At
any rate, it appears that, as a broad proposition, Neel-Schaffer is correct that Alabama courts
typically deem statutes of limitation to be procedural rather than substantive. See Precision Gear
Co. v. Continental Motors, Inc., 135 So.3d 953, 957 (Ala. 2013) (“As to matters of procedure,
however, Alabama applies its own procedural law …. This court has also held that, in most
instances, statutes of limitations are procedural matters.”). However, Neel-Schaffer does not cite
a single authority applying Alabama law to hold that an agreed-upon contractual choice-of-law
provision is ineffectual as to limitations periods governing contract-based claims. There is
federal appellate authority to the contrary. See American Steamship, 756 F.3d at 319 (even
assuming statute of limitations is “procedural” rule, where plain language of contract says that
contract is governed by New York law, “New York law will be applied as governing the
timeliness of claims asserted under the contract”). And again, as noted supra, “Alabama law has
long recognized the right of parties to an agreement to choose a particular state’s laws to govern
an agreement.” DJR Associates, 241 F. Supp.3d at 1220. Neel-Schaffer neither (i) identifies
case law declaring that such a right does not extend to applicable statutes of repose for
contractual claims, nor (ii) addresses the effect of a valid choice of law clause on its argument.
Under these circumstances, and in light of Neel-Schaffer’s failure to raise the
procedural/substantive distinction relating to statutes of limitation until its reply brief, in
contravention of the general rule forbidding litigants from raising new arguments in replies, the
Court will not perform the parties’ research for them and definitively resolve the issue at this
time. Instead, this ground for the Motion to Dismiss is rejected as having not been legally
supported by the movant, subject to the caveat that Neel-Schaffer may renew this ground for
relief in a properly supported motion for summary judgment at an appropriate time.

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Alternatively, Neel-Schaffer contends that even if the Mississippi statute of limitations
applies, its Motion to Dismiss should nonetheless be granted. Recall that the plain language of
the Mississippi provision states that “no action may be brought for contribution or indemnity for”
personal injuries arising out of deficient design of improvements to real property “except by
prior written agreement providing for such contribution or indemnity against any person, firm or
corporation performing or furnishing the design … of such improvement to real property more
than six (6) years after” the work is completed. Miss. Code § 15-1-41. O’Charley’s plain
reading of § 15-1-41 is that Mississippi has a six-year statute of repose for actions arising from
construction deficiencies, with an exception allowing contribution and indemnity claims to be
brought outside this repose period where there is a “prior written agreement providing for such
contribution or indemnity.”
Neel-Schaffer does not dispute that the ordinary meaning of the text of § 15-1-41
supports O’Charley’s interpretation; nonetheless, Neel-Schaffer posits that such a reading
“would lead to an absurd result” under which “the indemnitor is obligated forever – to the point
of death, or even beyond.” (Doc. 34, at 6.) Instead of this “absurd” outcome, Neel-Schaffer
proposes that § 15-1-41 be construed as meaning that “parties, for extra consideration or value,
[may] extend periods of indemnification … past six (6) years by including clear, precise, exact
language in the parties’ agreement.” (Id.) This contention is not persuasive for at least three
distinct reasons. First, basic principles of statutory construction counsel that courts must look to
the plain language of a statute to determine its meaning and must not rewrite or supplement that
language. See generally Ali v. Federal Bureau of Prisons, 552 U.S. 214, 228, 128 S.Ct. 831
(2008) (“We are not at liberty to rewrite the statute to reflect a meaning we deem more
desirable.”); Cockrell v. Pruitt, 214 So.3d 324, 331 (Ala. 2016) (“In determining the meaning of
a statute, this Court looks to the plain meaning of the words as written by the legislature.”)
(citations omitted); Sears v. Hampton, 143 So.3d 151, 154 (Ala. 2013) (“The function of this
Court is to say what the law is, not to say what it should be.”) (citations and internal quotation
marks omitted). Accordingly, the Court cannot and will not judicially modify § 15-1-41 by
reading nonexistent language into the statute to mandate a six-year statute of repose unless the
parties’ agreement includes “clear, precise, exact language” extending it “for a specific time
period,” as Neel-Schaffer advocates. Second, Neel-Schaffer fails to identify any authority that
has interpreted § 15-1-41 in the manner it proposes. Third, Neel-Schaffer’s suggestion that the

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plain language leads to an “absurd result” does not resonate. Section 15-1-41 is a statute of
repose, not a statute of limitations. No principle of law or equity says states must have statutes
of repose at all for construction design work, much less that it would be unfair, unjust or
“absurd” for a legislature to create exceptions to the construction statute of repose where the
parties have voluntarily agreed to a contractual indemnity arrangement.
Finally, Neel-Schaffer takes the position that applying § 15-1-41 to this dispute is
prohibited by Alabama public policy. It is true, of course, that Alabama courts have declined to
enforce choice of law provisions where application of the designated forum’s law will bring
about a result that is contrary to Alabama public policy.8 In so concluding, Alabama courts have
expressly looked to the Restatement (Second) of Conflict of Laws §§ 187 and 188 for guidance.
See Cherry, Bekaert, 582 So.2d at 506-07. According to Section 187(2)(b) of the Restatement, a
choice of law provision will not be honored where “application of the law of the chosen state
would be contrary to a fundamental policy of” the forum state. The Alabama Supreme Court has
indicated that “in order for a policy to be considered fundamental it must be a substantial one and
may be embodied in a statute which makes one or more kinds of contracts illegal or which is
designed to protect a person against the oppressive use of superior bargaining power.” Cherry,
Bekaert, 582 So.2d at 507 (citation and internal quotation marks omitted). In Alabama, this line
of reasoning is often invoked in the context of covenants not to compete, which have repeatedly
been held to fly in the face of Alabama public policy. By contrast, Neel-Schaffer has not shown
that it would violate a fundamental policy of the State of Alabama for an engineer to be held to
its promise to indemnify a real property owner for injuries caused by the engineer’s errors in a
site development plan, where the parties agreed their contract was to be governed by Mississippi
law. The mere fact that Alabama has structured its construction statute of repose differently than
8

See, e.g., Buckley v. Seymour, 679 So.2d 220, 226 (Ala. 1996) (“the right of
parties to a contract to choose the law governing their obligations is recognized by Alabama law
only if the consequences of that election are not contrary to Alabama public policy”); Cherry,
Bekaert, 582 So.2d at 507 (“While parties normally are allowed to choose another state’s laws to
govern an agreement, where application of that other state’s laws would be contrary to Alabama
policy, the parties’ choice of law will not be given effect and Alabama law will govern the
agreement.”); Mercedes-Benz U.S. Int’l, Inc. v. Cobasys, LLC, 605 F. Supp.2d 1189, 1196-97
(N.D. Ala. 2009) (“In Alabama, the right of parties to an agreement to choose a particular state’s
laws to govern an agreement is well-settled, so long as choice-of-law provisions are not contrary
to Alabama law or public policy.”) (citations and internal quotation marks omitted).

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Mississippi does not necessarily prompt a conclusion (suggested by Neel-Schaffer) that any
divergence from the Alabama statute necessarily violates a fundamental policy of Alabama.
Such a contract is neither illegal nor the product of oppressive use of bargaining power; to the
contrary, it was Neel-Schaffer’s own preprinted form contract that O’Charley’s seeks to enforce
here. Once again, Neel-Schaffer identifies no decisional authority to support its position that
Alabama has a fundamental public policy against enforcing agreed-upon contractual indemnity
provisions more than seven years after a construction project is completed.9
III.

Conclusion.
For all of the foregoing reasons, Neel-Schaffer’s Motion to Dismiss (doc. 26) is granted

in part and denied in part. The common-law indemnity cause of action set forth in the ThirdParty Complaint is dismissed as time-barred pursuant to Alabama’s construction statute of
repose. In all other respects, the Motion to Dismiss is denied. Neel-Schaffer is ordered to file
an answer to the Third-Party Complaint by no later than December 4, 2017.
DONE and ORDERED this 20th day of November, 2017.
s/ WILLIAM H. STEELE
UNITED STATES DISTRICT JUDGE

9

At best, Neel-Schaffer points to Alabama statutory language announcing a “state
objective of removing responsibility from, and preventing suit against these regulated
professions … which are least likely to be responsible or at fault for defects and deficiencies
which cause injury long after their services or work is completed.” Ala. Code § 6-5-225(e). The
quoted language reflects that the Alabama legislature indeed had a policy justification for
enacting the seven-year construction statute of repose. Legislatures typically do have policy
reasons for the laws they enact. However, to acknowledge that fact is not tantamount to saying
that it would violate a fundamental public policy of Alabama for private parties to contract
around the seven-year statute of repose (i.e., for an engineer to waive the protections of that
statute and promise contractual indemnification of the premises owner), which is essentially
what Neel-Schaffer did here by (i) promising to indemnify O’Charley’s for losses for personal
injury claims arising out of Neel-Schaffer’s negligence in preparing the site development plan,
and (ii) fixing Mississippi law as controlling that agreement. Movant has not shown that contract
to be unenforceable as a matter of fundamental Alabama public policy; therefore, the narrow
exception discussed in Cherry, Bekaert to the general law of honoring parties’ choice-of-law
provisions has not been shown to be applicable here.

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