Mississippi Power & Light Co. v. Cook, No. 2001-CA-00079-SCT.

• Decision Date: 05 December 2002
• Docket Number: No. 2001-CA-00079-SCT.
• Citation: 832 So.2d 474
• Parties: MISSISSIPPI POWER & LIGHT CO. v. Kenneth D. COOK.
• Court: Mississippi Supreme Court

832 So.2d 474

MISSISSIPPI POWER & LIGHT CO. v. Kenneth D. COOK.

No. 2001-CA-00079-SCT.

Supreme Court of Mississippi.

December 5, 2002.

Andrew D. Sweat, Natie P. Caraway, James Lawton Robertson and James W. Snider, Jr., Jackson, attorneys for appellant.

George McDowell Yoder, III, John G. Holaday, Jackson, James A. Woods, Jr., Tim Waycaster, Mary Margaret Waycaster, Natchez, David Wayne Baria, Jackson, attorneys for appellee.

EN BANC.

SMITH, P.J., for the Court.

¶ 1. The complaint in this matter was filed on July 31, 1991, by Kenneth D. Cook ("Cook") against Mississippi Power & Light Company ("MP&L") in the Circuit Court of the First Judicial District of Hinds County, Mississippi. After a change of counsel an amended complaint was filed on July 30, 1996. MP&L filed Motions to Dismiss, Summary Judgment and Partial Summary Judgment. All of these were denied.

¶ 2. On October 2, 2000, this matter came before the Hinds County Circuit Court, Honorable Tomie T. Green presiding and sitting with a jury. The jury returned a verdict for Cook for $150,000 in actual damages and $5,000,000 in punitive damages. Final judgment was entered on October 10, 2000, in favor of Cook.

¶ 3. Thereafter, Cook filed a Motion to Assess Attorneys' Fees and PreJudgment Interest and was awarded $2,060,000. MP&L filed a Motion for Judgment Notwithstanding the Verdict, or, in the alternative for a New Trial. The trial court denied those motions on November 28, 2000, and this appeal followed.

FACTS

¶ 4. Kenneth Cook is a former employee of MP&L. He worked for MP&L from 1983 until September 26, 1989. Following an on the job injury (three are alleged), Cook received workers' compensation benefits from MP&L and medical treatment. In making its determination to cut off Cook's benefits completely, MP&L relied upon two reports from treating physicians which said Cook had a 15% permanent impairment to the right shoulder. Cook filed his claims with the Mississippi Workers' Compensation Commission. MP&L and Cook reached a settlement, whereby MP&L paid Cook $55,000, which was approved by the Commission. However, in the settlement Cook reserved the right to bring a bad faith claim against MP&L. Shortly thereafter, Cook filed a complaint against MP&L in the Circuit Court of Hinds County asserting that MP&L halted his workers' compensation benefits in bad faith, among other claims. A verdict was rendered by a jury in favor of Cook and he was awarded $150,000 in actual damages, $5,000,000 in punitive damages, and $2,060,000 in attorneys' fees. Aggrieved, MP&L appeals to this Court.

STANDARD OF REVIEW

¶ 5. There are several standards of review that must be used in analyzing the issues in this appeal. First, when reviewing jury instructions on appeal, they must be read as a whole. Sentinel Indus. Contracting Corp. v. Kimmins Indus. Serv. Corp., 743 So.2d 954, 968 (Miss.1999). Additionally, the standard of review of jury verdicts is as follows:

Once the jury has returned a verdict in a civil case, we are not at liberty to direct that judgment be entered contrary to that verdict short of a conclusion on our part that, given the evidence as a whole, taken in the light most favorable to the verdict, no reasonable, hypothetical juror could have found as the jury found.

(citing Bell v. City of Bay St. Louis, 467 So.2d 657, 660 (Miss.1985)).

¶ 6. The standard of review for the denial of a motion for directed verdict and a motion for judgment notwithstanding the verdict are identical. Steele v. Inn of Vicksburg, Inc., 697 So.2d 373, 376 (Miss.1997). This Court will consider the evidence in light most favorable to the appellee, giving the appellee the benefit of all favorable inferences that may be reasonably drawn from the evidence. General Motors Acceptance Corp. v. Baymon, 732 So.2d 262, 268 (Miss.1999) (citing Steele, 697 So.2d at 376). If the facts are so overwhelmingly in favor of the appellant that reasonable jurors could not have arrived at a contrary verdict, this Court must reverse and render. Id. On the other hand, if there is substantial evidence in support of the verdict, that is, evidence of such quality and weight that reasonable and fair minded jurors in the exercise of impartial judgment might have reached different conclusions, this Court must affirm. Id.

¶ 7. The standard of review regarding attorneys' fees is the abuse of discretion standard. "The fixing of reasonable attorneys' fees is a matter ordinarily within the sound discretion of the trial court...." Gilchrist Tractor Co. v. Stribling, 192 So.2d 409, 418 (Miss.1966). This Court has held:

It is well settled in this State that what constitutes a reasonable attorney's fee rests within the sound discretion of the trial court and any testimony by attorneys with respect to such fees is purely advisory and not binding on the trial court. We will not reverse the trial court on the question of attorney's fees unless there is a manifest abuse of discretion in making the allowance....

Mauck v. Columbus Hotel Co., 741 So.2d 259, 269 (Miss.1999).

DISCUSSION

I. WHETHER PLAINTIFF COOK WAS ENTITLED TO MAINTAIN THIS ACTION FOR BAD FAITH REFUSAL TO PAY COMPENSATION BENEFITS CONSISTENT WITH THE DOCTRINE OF EXCLUSIVE ADMINISTRATIVE JURISDICTION WITHOUT HAVING FIRST SECURED RULINGS FROM THE MISSISSIPPI WORKERS' COMPENSATION COMMISSION THAT HE WAS ENTITLED TO FURTHER BENEFITS, OR THAT MP&L HAD VIOLATED SOME DUTY TO COOK UNDER THE MISSISSIPPI WORKERS' COMPENSATION LAW.

¶ 8. Miss.Code Ann. § 71-3-9 (2000) provides that liability of an employer to pay compensation shall be exclusive and in place of all other liability of such employer to the employee. While MP&L correctly states that the Mississippi Workers' Compensation Law is the exclusive remedy provision for workers' compensation, the independent tort of bad faith refusal to pay compensation is an exception to this provision. See S. Farm Bureau Cas. Ins. Co. v. Holland, 469 So.2d 55, 59 (Miss.1984); Luckett v. Miss. Wood, Inc., 481 So.2d 288, 290 (Miss.1985); McCain v. Northwestern Nat'l Ins. Co., 484 So.2d 1001, 1002 (Miss.1986); Leathers v. Aetna Cas. & Surety Co., 500 So.2d 451, 453 (Miss.1986). All of these cases "recognized exceptions to the exclusivity of the Act but only when based on tortious conduct subsequent to the work place injury." Peaster v. David New Drilling Co., 642 So.2d 344, 348 (Miss.1994). Just as in the case sub judice, these cases involved bad faith refusal to pay benefits.

¶ 9. In order to prevail in a claim for damages for bad faith there must be a determination as to whether there was a legitimate or arguable reason to deny the benefits, Aetna Casualty & Surety Co. v. Steele, 373 So.2d 797, 801 (Miss.1979), and/or that the denial constituted a willful or malicious wrong in disregard for his rights. Weems v. American Sec. Ins. Co., 486 So.2d 1222, 1226-27 (Miss.1986). Really the only test set out in Miller v. McRae's, Inc., 444 So.2d 368 (Miss.1984), is whether the injury is compensable under the act. The two prongs of the test are not separate requirements, but rather part of the inquiry into whether the injury is compensable. Furthermore, where there is a legitimate or arguable basis in the delay or denial of payments, there is no valid claim for punitive damages. Mutual Life Ins. Co. v. Estate of Wesson, 517 So.2d 521, 527 (Miss.1987).

¶ 10. MP&L argues that Cook should have exhausted his administrative remedies with the Worker's Compensation Commission. Per Miss.Code Ann. § 71-3-53 (2000), Cook could have taken the opportunity to reopen his settlement agreement within one year from the actual settlement. However, based on the case law cited herein, bad faith refusal to pay benefits is clearly an exception to the Act and may properly be brought in the circuit court.

II. WHETHER CERTAIN CORE AND OUTCOME DETERMINATIVE ISSUES IN THIS CASE WERE WITHIN THE PRIMARY JURISDICTION OF THE MISSISSIPPI WORKERS' COMPENSATION COMMISSION, BECAUSE OF WHICH COOK SHOULD NOT HAVE BEEN ALLOWED TO PROCEED WITHOUT FIRST SECURING RULINGS FROM THE COMMISSION THAT HE WAS ENTITLED TO FURTHER BENEFITS,

OR THAT MP&L HAD VIOLATED SOME DUTY OWED TO COOK UNDER THE MISSISSIPPI WORKERS' COMPENSATION LAW.

¶ 11. Campbell Sixty-Six Express, Inc. v. J. & G. Express, Inc., 244 Miss. 427, 141 So.2d 720, 725 (1962) states that the doctrine of primary jurisdiction "determines whether the court or the agency should make the initial decision." As previously discussed, the Mississippi Workers' Compensation Act is the exclusive remedy provision for workers' compensation, however, the independent tort of bad faith refusal to pay compensation is an exception to this provision. Per the analysis of the first issue, this case was properly brought in circuit court.

¶ 12. MP&L states in its brief, "Cook much preferred to have the Circuit Court and its jury delving into issues that were at the core of the experience of the Commission and that were at the heart of the case, without the benefit of the Commission's views." It was Cook's choice to decide where to bring this suit, and the circuit court clearly had jurisdiction.

¶ 13. MP&L argues that Cook should have brought the action under the Act based on a change of condition or because of a mistake in a determination of fact. However, Cook is not claiming a mistake in determining his disability but rather an independent tort which falls outside of the Act. Additionally, in Cook's settlement agreement, he reserved the right to bring a bad faith claim against MP&L.

III. WHETHER COOK HAD FAILED TO EXHAUST HIS ADMINISTRATIVE REMEDIES, AND, BEYOND THAT, HE WAIVED THEM.

¶ 14. Clearly Cook did not fail to exhaust his administrative remedies available to him. He settled his claim, and the order was approved by the Workers' Compensation Commission along with his reservation of rights to bring a bad faith claim. Under the caselaw cited herein, the intentional tort of bad faith refusal to pay a claim falls outside...