Adams v. Graceland Care Ctr. of Oxford, LLC

• Decision Date: 19 January 2017
• Docket Number: NO. 2013–CT–00724–SCT,2013–CT–00724–SCT
• Citation: 208 So.3d 575
• Parties: Shirley ADAMS, Individually and as Survivor and Only Heir of Dorothy Turner, Deceased v. GRACELAND CARE CENTER OF OXFORD, LLC, Graceland Management Company, Inc., Lafayette LTC, Inc., and Yalobusha General Hospital and Nursing Home
• Court: Mississippi Supreme Court

208 So.3d 575

Shirley ADAMS, Individually and as Survivor and Only Heir of Dorothy Turner, Deceased

v.GRACELAND CARE CENTER OF OXFORD, LLC, Graceland Management Company, Inc., Lafayette LTC, Inc., and Yalobusha General Hospital and Nursing Home

NO. 2013–CT–00724–SCT

Supreme Court of Mississippi.

DISPOSITION: January 19, 2017

ATTORNEY FOR APPELLANT: BOBBY FLOYD MARTIN, JR.

ATTORNEYS FOR APPELLEES: ANDY LOWRY THOMAS L. KIRKLAND, JR., JOHN G. WHEELER

EN BANC.

ON WRIT OF CERTIORARI

COLEMAN, JUSTICE, FOR THE COURT:

¶ 1. The Lafayette County Circuit Court granted summary judgment in favor of Graceland Care Center of Oxford, LLC; Graceland Management Company, Inc.; Lafayette LTC, Inc.; and Yalobusha General Hospital and Nursing Home (collectively, Graceland) in a case brought by Shirley Adams for injuries her mother allegedly sustained while in the defendants' care. As the basis for granting summary judgment, the circuit court determined that Adams was judicially estopped from bringing her suit because Adams had failed to disclose the suit in her prior bankruptcy proceedings. Adams appealed, and the Court of Appeals, in a plurality opinion, reversed the circuit court's decision to grant summary judgment and remanded the case to the circuit court to proceed with a trial on the merits. We granted certiorari review and hold that the Court of Appeals misapprehended the applicable standard of review and the law of judicial estoppel in the instant case. Therefore, we reverse the Court of Appeals' judgment, and we reinstate and affirm the circuit court's judgment.

FACTS AND PROCEDURAL HISTORY

¶ 2. Dorothy Turner was a resident at Graceland's nursing home facilities for several years. Her daughter, Adams, became concerned with Turner's care and treatment at the facilities, and according to Adams's deposition, she first contacted an attorney about a possible lawsuit in 2004 or 2005. For whatever reason, Adams did not pursue a suit at that time. However, Turner died in December 2007, and Adams filed suit against Graceland in May 2008.

¶ 3. During Adams's deposition in August 2009, counsel for Graceland discovered that in August 2004, Adams had filed for Chapter 13 bankruptcy. Adams's bankruptcy was fully discharged on March 31, 2009; however, in spite of her filing suit almost a year prior to her discharge, Adams did not inform the bankruptcy court of her suit nor did she amend her bankruptcy schedules to include the suit.

¶ 4. Upon learning of her prior bankruptcy and her failure to include the suit in her schedules prior to discharge, Graceland moved for summary judgment based on the doctrine of judicial estoppel. Adams filed a petition to reopen her bankruptcy proceeding and amend her schedules to list the suit as exempt personal property. The bankruptcy trustee objected to the classification of the suit as exempt personal property, and the bankruptcy court agreed and sustained the objection. Ultimately, Adams did amend her schedules to include the suit.

¶ 5. The circuit court initially noted by letter that it would grant Graceland's motion for summary judgment; however, following our opinion in Copiah County v. Oliver , 51 So.3d 205, 207 (¶ 12) (Miss. 2011), the circuit court entered an order staying the proceeding for the bankruptcy court to determine whether Adams had a duty to disclose her suit as an asset of her bankruptcy estate. The bankruptcy court's opinion was that "Adams had a continuing duty throughout the pendency of her bankruptcy case to disclose the state law cause of action." In re Adams , 481 B.R. 854, 859 (Bankr. N.D. Miss. 2012). Additionally, the bankruptcy trustee submitted a letter, at the bankruptcy court's request, indicating that it would not administer payment of any of the settlement/judgment proceeds to the unsecured creditors that remained at discharge.¹

¶ 6. Ultimately, the circuit court granted Graceland's renewed motion for summary judgment based on the doctrine of judicial estoppel. Adams appealed, and the Court of Appeals rendered its decision in November 2015. In the plurality opinion reversing the grant of summary judgment and remanding the case to the circuit court for trial, the Court of Appeals concluded that the circuit court had erred in applying judicial estoppel because Adams did not "knowingly" take inconsistent positions in the circuit court and bankruptcy court, nor did she, viewing the evidence "in the light most favorably to Adams, ... intend[ ] to conceal her claim from the bankruptcy court in order to reap a windfall by preventing her creditors from recovering any proceeds from a potential judgment." Adams v. Graceland Care Ctr. of Oxford, LLC, et al. , 208 So.3d 597, 604, 2015 WL 6685213, *6 (¶¶ 21–22) (Miss. Ct. App. Nov. 3, 2015). Following the Court of Appeals' denial of Graceland's motion for rehearing, Graceland filed its petition for certiorari review, which we granted.

ANALYSIS

¶ 7. In its petition for certiorari review, Graceland raises three issues. First, Graceland asserts that the Court of Appeals' opinion "usurped the trial court's discretion by imposing the wrong standard of review." Next, Graceland claims that the Court of Appeals' opinion "misapplies the law of judicial estoppel."²

I. Standard of Review

¶ 8. According to Graceland, the Court of Appeals' opinion erred by utilizing a de novo review of the circuit court's application of judicial estoppel instead of an abuse of discretion standard of review. We agree that the Court of Appeals conflated the standards of review in the present case, because it appears that the Court of Appeals attempted to apply a de novo review to both the application of judicial estoppel and the grant of summary judgment.³

¶ 9. It is well-settled that appellate review of the trial court's grant or denial of a motion for summary judgment requires the application of de novo review. Copiah Cty. v. Oliver , 51 So.3d 205, 207 (¶ 7) (Miss. 2011) (citing Monsanto v. Hall , 912 So.2d 134, 136 (Miss. 2005) ). Similarly settled is the standard of review applied to a trial court's application of judicial estoppel, which is the abuse of discretion standard. Kirk v. Pope , 973 So.2d 981, 986 (¶ 11) (Miss. 2007) (citing Superior Crewboats, Inc. v. Primary P & I Underwriters , 374 F.3d 330, 334 (5th Cir. 2004) ).

¶ 10. The Court of Appeals' decision implied that, under Oliver , a new standard of review—de novo—is applied to cases involving a trial court's grant of summary judgment based on judicial estoppel. However, that simply is not the case, and our opinion in Oliver does no such thing. As the dissent in the Court of Appeals' opinion pointed out, our opinion in Oliver "did not review the merits of the trial court's application of the doctrine of judicial estoppel." Adams , 208 So.3d at 605, 2015 WL 6685213, at *7 (¶ 26) (Wilson, J., dissenting). We merely stated that the standard of review for summary judgment is de novo and that the trial court's denial of summary judgment under the de novo standard was appropriate because the bankruptcy court needed an "opportunity to consider whether Oliver had a duty to disclose her post-petition, post-confirmation claim" before the trial court could determine whether judicial estoppel even applied. Oliver , 51 So.3d at 207 (¶¶ 7, 11–12).

¶ 11. Gibson v. Williams, Williams & Montgomery, P.A. , 186 So.3d 836 (Miss. 2016), upon which the dissent by Justice Kitchens largely relies, does nothing to contradict our holding. The Gibson Court did not separately address the standard of review for the application of judicial estoppel; in other words, although it clearly acknowledged the de novo standard of review applicable to summary judgment, the Gibson Court does not tell us whether it applied a de novo or abuse of discretion standard to the issue of judicial estoppel. Id. at 846–847 (¶¶ 24–30). Accordingly, we respectfully disagree with Justice Kitchens's assumption that the Gibson Court applied a de novo standard of review when it discussed judicial estoppel. (Kitchens Dis. at ¶ 32). Although the Gibson Court does not tell its readers why it omitted any discussion of the standard of review, it may well be because it was not reviewing anything but, rather, considering an alternative argument advanced on appeal. According to the Gibson opinion, the trial judge did not base the decision there under review on judicial estoppel and appears to have made no determination, one way or the other, regarding its application. Id. at 842 (¶ 12). Rather, the trial judge there granted summary judgment based on the application of collateral estoppel. Id.¶ 12. Therefore, the appropriate analysis requires an appellate court to use the abuse of discretion standard to review the trial court's determination that judicial estoppel is or is not applicable. Then, an appellate court would use the de novo standard to determine whether summary judgment was or was not appropriate. We hold that the Court of Appeals erred when it applied an incorrect standard of review in its review of the present case. Because the Court of Appeals applied an incorrect standard of review, we now address whether the circuit court properly applied judicial estoppel and whether summary judgment was appropriate, using the appropriate standards of review for each issue.

II. Judicial Estoppel

¶ 13. As explained above, we review the circuit court's application of judicial estoppel using the abuse of discretion standard. "Our inquiry is limited to whether the trial judge abused his discretion; we may not rule on whether he was ‘right’ or ‘wrong’ in our view. And, unless the trial court based its decision on an erroneous review of law, ... this Court is not authorized to reverse for an abuse of discretion unless we find it was ‘arbitrary and clearly erroneous.’ " Detroit Marine Eng'g v. McRee , 510 So.2d 462, 467 (Miss. 1987) (citations omitted).

¶ 14. Judicial estoppel operates to protect the integrity of the judicial system. Gibson , 186 So.3d at 847 (¶ 24). It has three...