Accredited Sur. and Cas. Co., Inc. v. Bolles, 57764

• Citation: 535 So.2d 56
• Decision Date: 30 November 1988
• Docket Number: No. 57764,57764
• Parties: ACCREDITED SURETY AND CASUALTY COMPANY, INC. v. Ann Atkinson BOLLES (Simmons).
• Court: United States State Supreme Court of Mississippi

Page 56

535 So.2d 56

ACCREDITED SURETY AND CASUALTY COMPANY, INC. v. Ann Atkinson BOLLES (Simmons).

No. 57764.

Supreme Court of Mississippi.

Nov. 30, 1988.

Alvin M. Binder, Lisa B. Milner, Binder, Milner & Milner, Jackson, for appellant.

J. Kevin Watson, Fox & Watson, Jackson, for appellee.

Before HAWKINS, P.J., and ROBERTSON and SULLIVAN, JJ.

SULLIVAN, Justice, for the Court.

Ann Bolles Simmons and William Bolles were divorced April 12, 1982, and as a result Bolles had substantial financial obligations to Simmons, which he ignored. In April 1984, Simmons sought a contempt citation and a Writ Ne Exeat Republica, among other things against Bolles. The Writ Ne Exeat was issued and a bond of $125,000.00 was required. After Bolles was arrested the bond was reduced to $50,000.00. Bolles paid $5,000.00 for a $50,000.00 bond from Ruth Newman d/b/a A-Bonding Company, as agent for Accredited Surety and Casualty Company, Inc., and was released from jail.

In November, 1984, Bolles was found in contempt, in arrears in the amount of $138,188.52, and the Ne Exeat Bond was continued in full force and effect. In February, 1985, the Ne Exeat Bond was again continued in full force and effect. This war of attrition continued without compliance At the hearing on July 25, 1986, counsel for Newman and Accredited Surety admitted that his clients could not produce Bolles and they were liable on the bond. However, both defendants urged the trial court that they only owed $12,466.50 plus attorneys fees, that being the amount last adjudged against Bolles by the chancellor. The actual arrearages and judgments against Bolles in favor of Simmons at that time far exceeded $50,000.00. The chancellor found that the entire $50,000.00 bond was forfeited and directed the drawing of an order to that effect. Counsel for Newman and Accredited Surety signed the order as "Agreed as to Form" even though the order provided that Newman and Accredited Surety were "jointly and severally" liable to Simmons. This order was entered on July 25, 1986.

by Bolles until July 7, 1986, when the chancellor again found Bolles in contempt for disobeying court orders and a show cause order was issued to Newman and Accredited Surety to either produce Bolles or show cause why the $50,000.00 bond should not be forfeited to Simmons.

Within the thirty day appeal time Newman, but not Accredited Surety, perfected an appeal to this Court. After the time for appeal, Simmons began efforts to collect her judgment from Accredited Surety. Accredited Surety sought and received a temporary restraining order to prevent execution on the judgment by Simmons. Simmons filed a motion to dissolve the temporary restraining order and Accredited Surety responded with a motion for relief from judgment or order under Miss.R.Civ.P. 60(b). The ground asserted for relief under Rule 60(b) is that the July 25, 1986, Order held Newman and Accredited Surety "jointly and severally" liable. Newman and Accredited Surety argued that their relationship is that of principal and agent thereby precluding any joint and several liability among them. They requested a proper order be entered reflecting that the July 25th judgment is against Accredited Surety and Casualty only and not against Newman and Accredited Surety, jointly and severally. The motion proceeded to hearing on (b)(2) of Rule 60, Miss.R.Civ.P., which provides for relief from judgment on account of "accident or mistake."

At the hearing Newman and Accredited Surety argued that the July 25, 1986, Order was entered under a mistaken belief that Newman and Accredited Surety were two separate sureties. The testimony at the hearing established unequivocally that the relationship was in fact one of principal/agent and not joint and several. Consequently, the chancellor entered an amended order declaring the previous order of July 25, 1986, to be of no effect. The amended order granted Simmons a judgment against Accredited Surety and Casualty only in the amount of $50,000.00.

As a result of the entry of the new order the thirty day appeal time began to run again from the date of the amended order and Accredited Surety promptly perfected an appeal in which it assigned only one error:

1. The Lower Court erred in awarding Simmons a judgment against the surety company in the entire amount of the Ne Exeat Bond, $50,000.00.

Simmons promptly perfected a cross-appeal, and also assigned only one error:

1. The Lower Court abused its discretion by setting aside its Order of July 25, 1986, thus allowing Accredited Surety to circumvent Supreme Court Rule 48 and perfect this appeal out of time.

I. DID THE CHANCELLOR ABUSE HIS DISCRETION BY SETTING ASIDE HIS ORDER DATED JULY 25, 1986, THUS ALLOWING ACCREDITED SURETY TO CIRCUMVENT SUPREME COURT RULE 48 AND PERFECT THIS APPEAL?

Simply stated Simmons argues that Accredited Surety used its Rule 60(b)(2) request as a device, quite successfully, to circumvent Miss.Sup.Ct.R. 48. ¹ Rule 48 requires notice of appeal to be filed "within Accredited Surety argues that a liberal interpretation of Rule 60 supports the action of the chancellor. Moreover, Accredited Surety asserts that the problems arising from the July 25th Order did not come fully to light until the judgment showed up against Ruth Newman personally on September 10, 1986. This assertion is contradicted by the language of the bond itself which states that Bolles, Newman, and Accredited Surety were "jointly and severally" bound, and by counsel for Accredited Surety's acknowledgment of her dissatisfaction with the language in the July 25th Order which was presented for her approval on July 25, 1986.

                thirty days after the date of entry of the judgment, order or decree."   In this case, Newman met the thirty day deadline by perfecting her appeal within the proper time.  Accredited Surety, however, never perfected an appeal within thirty days of the July 25th Order.  Simmons further argues that counsel for Newman and Accredited Surety had sufficient notice of the joint and several liability issue to seek its correction pursuant to 59(e), Miss.R.Civ.P., which gives a party ten days from entry of judgment to seek an alteration or amendment of that judgment
                

Notwithstanding the fact that counsel for Newman and Accredited Surety had notice of the language problem before the July 25th Order was signed by the chancellor, the lower court held that it had the right under Rule 60 to conform the original judgment to "what was intended and what has been true throughout this case [which] is that Ms. Newman, as A-Bonding Company, has been acting as the agent for Accredited Surety and Casualty Company." The chancellor felt that "to do anything else would be to act inequitably with regard to the surety company which signed the bond." The Amended Order was filed on September 11, 1986.

Motions that seek relief from judgment pursuant to Rule 60, Miss.R.Civ.P. are addressed to the sound discretion of the trial court, and the only question asked on appeal is whether the trial court's ruling on such a motion amounts to an abuse of discretion. Stringfellow v. Stringfellow, 451 So.2d 219, 221 (Miss.1984). To determine an abuse of discretion question we are necessarily required to determine whether the facts of this case bring it within the scope of Rule 60(b) motions, or whether Rule 59(e), Miss.R.Civ.P., provides the only avenue of relief on these facts.

We garner from our decision in Stringfellow, supra, that "a balance must be struck between granting a litigant a hearing on the merits with the need and desire to achieve finality in litigation." 451 So.2d at 221. As a general rule, the "extraordinary relief" provided for by Rule 60(b), will be granted "only upon an adequate showing of exceptional circumstances," and gross negligence, ignorance of the rules, ignorance of the law, or carelessness on the part of the attorney will not provide sufficient grounds for relief. Id. Finally, we are obliged to ask why the mistake or inadvertence was not avoided, and whether the motion was timely filed. Stringfellow, 451 So.2d at 221; Miss.R.Civ.P. 60(b) (1982). Inextricably tied to the issue of timeliness are questions of why the movant failed to seek a correction sooner, and whether the non-moving party has sustained any prejudice. See 11 Wright & Miller, Federal Practice & Procedure, Sec. 2866 at page 228-29 (1973).

A. TIMELINESS

Much is made over the fact that the Motion for Relief from Judgment was filed after the time for filing notice of appeal had expired. There are cases where the expiration of the time for appeal entitles the judicial system and the non-moving party to rely on the finality of the judgment. Rule 60 recognizes, however, that there are also cases where relief may be sought after expiration of the time for appeal. Rule 60 states that motions under Section (b)(2) of the rule must be made "within a reasonable time" not to exceed six months after the judgment was entered. Therefore, the rule itself accommodates concerns over finality by setting an outer time limit while simultaneously inviting a flexible application depending Newman and Accredited Surety's reason for not taking corrective action sooner is that the joint and several liability of Newman did not come fully to light until September 10, 1986, the day their motion was filed. However, this assertion is contradicted in the following respects: Counsel for Newman and Accredited Surety expressed concern over the joint and several language in the Order on July 25, 1986, before it was presented to the judge, but registered her approval as to form nonetheless; the bond itself, executed on April 6, 1984, states that Bolles, Newman and Accredited Surety "jointly and severally bind ourselves." Of course, Ruth Newman did sign the bond as attorney in fact only for Accredited Surety, and she relied on her attorney to prepare the bond; Ruth Newman d/b/a A-Bonding Company perfected an appeal on her own behalf...