In light of Klaxon, the applicability and construction of section 12, either alone or in connection with section 11, must be determined in accordance with the law of Alabama. In Macey v. Crum, 1947, 249 Ala. 249, 30 So.2d 666, the Supreme Court of Alabama held that at least as to a policy insuring the named insured against liability, as distinguished from indemnity against loss, sections 11 and 12 applied without regard to whether the insurance contract was made in Alabama or not, and without regard to whether the named parties to the contract of insurance were residents or nonresidents of Alabama. The Alabama Supreme Court held that, "The lex loci controls the validity and construction of the contract but the lex fori operates on the remedy to enforce it."

Jas. M. Fullan, Jr., Birmingham, for appellee Jones. A suit by a third party against the insurance carrier of an insured to enforce collection of the third party's judgment against the insured must be prosecuted in equity and pursuant to the remedy provided by Title 28, § 12, Code 1940. Reed v. Hill, 262 Ala. 662, 80 So.2d 728; Macey v. Crum, 249 Ala. 249, 30 So.2d 666; State Farm Mut. v. McClendon, 269 Ala. 456, 114 So.2d 153; Insurance Co. of N. A. v. Davis, 274 Ala. 541, 150 So.2d 192. Where an insurer denies coverage on one ground, it thereby waives all others. An insurance carrier seeking to invoke the other insurance clause in its own policy should be allowed to present evidence on the part of another insurance company which estops it from disclaimer of primary liability. Home Ind. Co. v. Scharnagel, 227 Ala. 60, 148 So. 596; Aetna Cas. Surety Co. v. Allstate Ins. Co., D.C., 228 F. Supp. 219; Code 1940, Tit. 7, § 262; London Lancashire Ins. Co. v. McWilliams, 218 Ala. 503, 119 So. 15. The "temporary substitute automobile" provision in a liability policy contemplates that the automobile claimed to be covered is actually used as a substitute for the described automobile and it is necessary that there be a reasonable similarity between the use made of the original car and the substituted vehicle.

The court held that the Alabama statute which allows a direct action against the insurer after judgment against its insured [now Ala.Code § 27-23-2 (1977)] applied. 495 F.2d at 539 (quoting from Macey v. Crum, 249 Ala. 249, 30 So.2d 666 (1947)). The court applied Texas law in construing the contract of insurance but applied Alabama law in determining whether or not the judgment creditor could maintain an action against the judgment debtor's insurer.

ANW argues that the principle of lex loci contractus requires that the law of Italy be applied to the corporate succession issue. ANW is correct that the choice of law rule followed by Alabama provides that the law of the state wherein the contract was executed governs questions regarding the validity and interpretation of the contract. Harrison v. Insurance Co. of N. America, 294 Ala. 387, 391, 318 So.2d 253, 257 (1975); Macey v. Crum, 249 Ala. 249, 252, 30 So.2d 666, 669 (1947); Furst Thomas v. Sandlin, 208 Ala. 490, 492, 94 So. 740, 742 (1922). However, we do not agree with ANW that this rule requires the application of Italian law here.

Section 12 of Title 28 of the Code places the injured party in the position of the insured, but does not enlarge, modify, or impair the substantial obligations of the contract of insurance. Macey v. Crum, 249 Ala. 249, 30 So.2d 666; Sansom v. New Amsterdam Ins. Co., D.C., 95 F. Supp. 6; Employers Ins. Co. of Alabama v. Johnston, 238 Ala. 26, 189 So. 58. A contract may be pleaded in haec verba or according to its legal effect, but the agreement, or so much thereof as is material to the breach, and the breach itself, must be set forth with certainty. Crumpton v. Campbell, 228 Ala. 79, 152 So. 220; Federal Land Bank of New Orleans v. Mulkey, 228 Ala. 500, 153 So. 775; Consolidated Products Co. v. Jasper Land Co., 221 Ala. 472, 129 So. 39; McKenzie v. North River Ins. Co., 257 Ala. 265, 58 So.2d 581. In declaring upon a contract of insurance it is a necessary averment that the policy was in force and effect at the time of the injury or that the amount sued for is due. Nat. Cas. Co. v. Thompson, 264 Ala. 1, 84 So.2d 364; United States Health Accident Co. v. Veitch, 161 Ala. 630, 50 So. 95. To entitle a complainant to discovery, he must first show his right to relief, a cause of action, and, if he does so, must then

The equitable remedy afforded by Title 28A, Section 485, to collect a judgment debt partakes of the nature of an equitable garnishment, whereby the judgment creditor may collect his judgment from one who owes the judgment debtor and has agreed to pay the liability imposed by the judgment. Macey v. Crum, 249 Ala. 249, 30 So.2d 666 (1947); State Farm Mutual Automobile Insurance Co. v. McClendon, 269 Ala. 456, 114 So.2d 153 (1959). The procedure provided by Title 28A, Section 485, Code of Alabama of 1940, as amended, does not enlarge or modify in any respect the substantial liability created by the contract of insurance. It merely enables the person suffering the initial damages, out of which grows the loss to the insured, to acquire a lien against the loss and the right to damages or indemnity arising under the policy, and to enforce it in his own name. Macey v. Crum, 249 Ala. 249, 30 So.2d 666 (1947); State Farm Mutual Automobile Insurance Co. v. McClendon, 269 Ala. 456, 114 So.2d 153 (1959).

The district court also held that, while South Carolina law will govern any claims arising under contract law, Alabama law will govern the remedy in the event liability exists. The district court cited two older decisions of the Alabama Supreme Court, Jones v. Jones, 18 Ala. 248, 250 (Ala. 1850) and Macey v. Crum, 249 Ala. 249, 30 So.2d 666, 669 (1947), to support this conclusion.Jones states:

896 F.2d at 499 n. 5 (additional citations omitted). Moreover, in Macey v. Crum, 249 Ala. 249, 30 So.2d 666 (1947), the Supreme Court of Alabama held that its direct action statute "merely enables the person suffering the initial damages, out of which grows the loss to the insured, to acquire a lien against the loss and the right to damages or indemnity arising under the policy, and to enforce it in his own name." Id.

That doctrine simply states that the contract is governed as to validity, interpretation, and obligation by the law of the place where it is made. Western Union Telegraph Co. v. Favish, 196 Ala. 4, 71 So. 183 (1916). This is still the general rule of law in Alabama today. Fleming v. Pan Am. Fire Cas. Co., 495 F.2d 535 (5th Cir. 1974); United States Fidelity Guar. Co. v. Slifkin, 200 F. Supp. 563 (N.D.Ala. 1961); Macey v. Crum, 249 Ala. 249, 30 So.2d 666 (1947); J.R. Watkins Co. v. Hill, 214 Ala. 507, 108 So. 244 (1926). Under this general rule the laws of Alabama would arguably apply as the acceptance of the contract occurred in Alabama.

Turning to the bill of complaint, it is at once apparent that complainant has undertaken to state a joint cause of action against these defendants. There can be no doubt under the local law of plaintiff's right to prosecute this action and the same legislative enactment which provides his substantive rights also prescribes a remedy for their enforcement by a suit in equity against insured and insurer, jointly. It follows, therefore, that there was a proper joinder of these defendants in the State court. Macey v. Crum, 249 Ala. 249, 30 So.2d 666, and cases collated therein. Though the matter may be fraught with some doubt, and there is no intention of putting it to rest here, it would appear that the State statute does not require the joinder of the insured in every action brought under its authority.