Alabama Supreme Court 1971330.
On Application for Rehearing
The opinion of March 6, 1998, is withdrawn and the following opinion is substituted therefor.
In August 1996, Compass Bank sued for a judgment declaring that mortgages it held on certain real estate had priority over several other liens on that real estate, including that of Builder's Supply Company, Inc., which claimed a materialman's lien. The trial court
A motion for summary judgment is to be granted when no genuine issue of material fact exists and the moving party is entitled to a judgment as a matter of law. Rule 56(c)(3), Ala. R. Civ. P. See West v. Founders Life Assurance Co. of Florida, 547 So.2d 870 (Ala.1989), and Bass v. SouthTrust Bank of Baldwin County, 538 So.2d 794 (Ala.1989), for a discussion of the application of the substantial evidence rule.
On April 14, 1995, Kenneth R. Poole and Sheila Poole executed to Compass a construction mortgage in the initial amount of $80,000, which included this provision for future advances:
The mortgage was recorded on April 14, 1995. The due date was October 14, 1995. On August 14, 1995, Compass advanced $35,000. Builder's Supply began furnishing materials on September 13, 1995. On September 28, 1995, Compass advanced $30,000. On October 30, 1995, Builder's Supply filed in the probate court a materialman's lien for approximately $45,000. On November 22, 1995, the Pooles executed a mortgage
Ala.Code 1975, § 35-11-211(a), states that a materialman's lien "shall have priority over all other liens, mortgages or incumbrances created subsequent to the commencement of work on the building or improvement" and that "all liens, mortgages and incumbrances... created prior to the commencement of such work shall have priority over all liens for such work." Our supreme court has interpreted this section as follows:
Metro Bank v. Henderson's Builders Supply Co., 613 So.2d 339, 340 (Ala.1993).
The dispositive issue is whether the taking of the permanent mortgage discharged the debt and released the lien created by the
127 Ala. at 408-10, 30 So. at 734-35 (citations omitted). See also Stephens Wholesale Bldg. Supply Co. v. Birmingham Federal Sav. & Loan Ass'n, 585 So.2d 870, 872 (Ala.1991).
The provisions in the construction mortgage, the additional advances, and the provisions in the permanent mortgage indicate that the parties' intent was to protect Compass's secured interest in the same real estate described in both mortgages. The taking of the permanent mortgage, which was recorded November 22, 1995, did not extinguish the security interest created initially by the construction mortgage that was recorded April 14, 1995. Therefore, Compass's mortgages have priority over the Builder's Supply lien, and the trial court properly entered the summary judgment for Compass.
OPINION OF MARCH 6, 1998, WITHDRAWN; OPINION SUBSTITUTED; APPLICATION OVERRULED; RULE 39(k) MOTION DENIED; AFFIRMED.
ROBERTSON, P.J., and YATES, MONROE, and THOMPSON, JJ., concur.