C & L Rural Electric Cooperative Corp. v. Kincade

• Decision Date: 12 August 1959
• Docket Number: Civ. No. 760.
• Citation: C & L Rural Electric Cooperative Corp. v. Kincade, 175 F. Supp. 223 (N.D. Miss. 1959)
• Parties: C & L RURAL ELECTRIC COOPERATIVE CORPORATION et al., Plaintiffs and Counterdefendant, v. Robert KINCADE, Eva Kincade, and W. S. Kincade, Defendants and Counterclaimants.
• Court: U.S. District Court — Northern District of Mississippi

175 F. Supp. 223

C & L RURAL ELECTRIC COOPERATIVE CORPORATION et al., Plaintiffs and Counterdefendant, v.Robert KINCADE, Eva Kincade, and W. S. Kincade, Defendants and Counterclaimants.

Civ. No. 760.

United States District Court N. D. Mississippi, Delta Division.

August 12, 1959.

Lasley & Lovett, Little Rock, Ark., for C & L Rural Elec. Coop. Corp.

Vincent J. Brocato, Clarksdale, Miss., James T. Kendall, Jackson, Miss., for Kincades.

CLAYTON, District Judge.

This suit began here as an action to recover on a judgment rendered by the Circuit Court of Lincoln County, Arkansas.It is now before the Court on a motion for summary judgment with respect to a severable part of claims asserted by amended counterclaim.Before proceeding with the issue now before the Court, it will be necessary to briefly outline the pertinent transactions leading up to this controversy.

On February 6, 1947, C & L Rural Electric Cooperative Corporation, an Arkansas corporation, hereinafter referred to as C & L, entered into a construction contract with Robert Kincade, Eva Kincade, and W. S. Kincade, partners doing business as Delta Construction Company in Clarksdale, Mississippi, hereinafter referred to as the Kincades.This contract was for construction which was to be undertaken for C & L in the State of Arkansas.In compliance with the terms of this contract, the Kincades obtained a liability insurance policy, a workmen's compensation policy, and a contractors performance bond from American Casualty Company of Reading, Pennsylvania.

An employee of the Kincades, Grady L. McEntire, was injured while working on this construction project and on November 17, 1948, recovered a judgment for $40,000 from C & L. Suit was then filed by C & L and its insurer, Employers Mutual Liability Insurance Company, to recover from the Kincades the amount they had paid McEntire.Judgment finding C & L responsible to the extent of 40% and the Kincades responsible to the extent of 60% for the damages sustained by McEntire was affirmed by the Arkansas Supreme Court and judgment was entered in the Circuit Court of Lincoln County, Arkansas, on May 11, 1957.

On May 11, 1948, subsequent to the injury of McEntire, a second contract was entered into between C & L and the Kincades whereby the Kincades agreed to construct approximately 12 miles of 33-KV transmission lines in the vicinity of Warren, Arkansas.Alleging breach of this contract, the Kincades filed suit against C & L on September 24, 1951, in the Circuit Court of Lincoln County, Arkansas, CauseNo. 1231, to recover damages in the sum of $8,654.13.This suit is still pending.

On July 9, 1958, C & L and Employers Mutual Insurance Company filed suit in this court against the Kincades to recover on the judgment entered on May 11, 1957, in the Circuit Court of Lincoln County, Arkansas.

In addition to a third-party complaint which they filed against American Casualty Company, the Kincades filed a counterclaim alleging breach by C & L of the construction contract of May 11, 1948.Damages were alleged to be $8,654.13.This counterclaim is the same claim asserted in the action pending in the Circuit Court of Lincoln County, Arkansas, CauseNo. 1231.An order was entered by this court dismissing the counterclaim for want of the jurisdictional amount necessary in diversity cases.But, the Kincades, with leave of court, then filed an amended counterclaim wherein they allege that the judgment sued upon by C & L and Employers Mutual Insurance Company was obtained through the "fraudulent conduct" of C & L and Employers Mutual Insurance Company"acting in concert" with the third-party defendant, American Casualty Company, and should, therefore, be set aside and the enforcement thereof permanently enjoined.As a further counterclaim, the Kincades demanded judgment against C & L in the sum of $8,654.13 for breach of the construction contract of May 11, 1948.All of C & L's acts alleged as a breach of this contract, occurred, if they did occur, at the construction site in Arkansas or involved the actual construction there.

C & L then filed a motion for summary judgment as provided by Rule 56(b) of the Federal Rules of Civil Procedure,28 U.S.C.A., with respect to that portion of the amended counterclaim demanding judgment in the sum of $8,654.13.The case is now before the Court on this motion for summary judgment.

The issue presented on this motion is whether that portion of the amended counterclaim demanding a judgment of $8,654.13 and interest is barred by Mississippi statutes of limitation.Defendants' counsel, although not admitting that the Mississippi statutes of limitation apply, contends that the "absence statute" of Mississippi or the Arkansas or Mississippi "Journey's Account"statute would toll the statute.

It is well settled that in an action on a contract the statute of limitations of the state where the suit is brought governs.Le Mieux Brothers Corporation v. Armstrong, 5 Cir., 1937, 91 F.2d 445;United States Fidelity & Guaranty Co. v. Ransom, 192 Miss. 286, 5 So.2d 238;Dunn Construction Co. v. Bourne, 172 Miss. 620, 159 So. 841;Wright v. Mordaunt, 77 Miss. 537, 27 So. 640.The applicable Mississippi statutes, all in Mississippi Code 1942, Annotated, are:

"§ 722.Actions to be brought in six years.

All actions for which no other period of limitation is prescribed shall be commenced within six years next after the cause of such action accrued, and not after."

"§ 740.Absence from the state.

If, after any cause of action have accrued in this state, the person against whom it has accrued be absent from and reside out of the state, the time of his absence shall not be taken as any part of the time limited for the commencement of the action, after his return."

"§ 744.New action after abatement, reversal.

If in any action, duly commenced within the time allowed, the writ shall be abated, or the action otherwise avoided or defeated, by the death of any party thereto, or for any matter of form, or if, after verdict for the plaintiff, the judgment shall be arrested, or if a judgment for the plaintiff shall be reversed on appeal, the plaintiff may commence a new action for the same cause, at any time within one year after the abatement or other determination of the original suit, or after reversal of the judgment therein; and his executor or administrator may, in case of his death, commence such new action, within the said one year."

It is without dispute that the Kincades' claim (now asserted in the amended counterclaim) accrued sometime in the year 1948 and that this counterclaim was not filed until 1958.Therefore, the claim is barred by Section 722 unless some fact is shown that would take it out of the statute.The Kincades claim that either ...