Allied Steel Corp. v. Cooper, s. 07-CA-59563
| Decision Date | 31 August 1992 |
| Docket Number | Nos. 07-CA-59563,91-CA-0287,s. 07-CA-59563 |
| Citation | 607 So.2d 113 |
| Parties | ALLIED STEEL CORPORATION, Park Supply Company, Inc. & Quick & Grice, Inc. v. Carle COOPER. Carle COOPER v. David DIAMOND and James T. Bennett, Jr., d/b/a the Lite House; Quick & Grice, Inc., Allied Steel Corporation and Park Supply Company, Inc. |
| Court | Mississippi Supreme Court |
Byron Stockstill, Williams Smith & Stockstill, Picayune, Jim Davis, Gulfport, for appellants Allied Steel Corp. et al.
Sam P. Cooper, Jr., Cocoa Beach, Fla., for appellee Carle Cooper in No. 07-CA-59563.
Jack Parsons, Rebecca C. Taylor, Parsons & Taylor, Wiggins, for appellant Carle Cooper in No. 91-CA-0287.
Before DAN M. LEE, P.J., and ROBERTSON and McRAE, JJ.
McRAE, Justice, for the Court:
This opinion reflects the consolidation of two actions. The first ("Cooper I ") is an appeal by construction lienholders, Allied Steel Corporation, Park Supply Company and Quick & Grice, Inc. from a July 1, 1988, decision of the Pearl River County Circuit Court, finding Carle Cooper not personally liable for debts owed to them in connection with the development of the Chimney Square Mall. The second ("Cooper II ") is an appeal by Cooper from a February 28, 1991, ratification by the Pearl River County Circuit Court of a Sheriff's Sale and Conveyance of the west side of the Chimney Square property to the appellants in Cooper I and additional construction lienholders, David Diamond and James T. Bennett, Jr. d/b/a The Lite House.
Finding that the evidence in the record does not support the lower court's finding, but does support a finding that Cooper and his former business associate, Bernard Heaps, acted as partners or joint venturers in the development of the Chimney Square Mall project, we reverse the decision of the Circuit Court in Cooper I. We affirm the Circuit Court's ratification of the Sheriff's Sale and Conveyance in Cooper II.
FACTS
Carle Cooper, a real estate developer and contractor, and Bernard Heaps, owner of an interior construction business alternately known as "House of Interiors" and "House of Interiors Construction," purchased a property known as the "old blanket factory" from Sunbeam Electric Company in 1984 for $155,000.00. Each owned an undivided one-half interest in the property. Although they intended to resell the property, their efforts to do so were unsuccessful.
In 1986, Cooper and Heaps made the decision to renovate part of the building for use as a retail mini-mall. They obtained a variance for commercial use and began renovations later that year. To finance the project, they co-signed a promissory note and deed of trust to the First National Bank of St. Tammany Parish in Slidell, Louisiana, on June 2, 1986. As the proceeds of the $410,000.00 construction loan were disbursed by the bank, they were deposited in a joint checking account established for the purpose of paying for materials and work incident to the transformation of the east half of the old factory building into the Chimney Square Mall.
Cooper obtained a builder's risk insurance policy as well as a loss of earnings policy from Thigpen Insurance Company, Inc. He signed the policy application on behalf of Cooper, Heaps and Latier Corporation, one of his business enterprises, added to the application at his request.
Work on Chimney Square Mall began in 1986. From the beginning, it appears from the record that Cooper and Heaps took a rather ad hoc approach to the undertaking. They entered into no express agreements with each other. Likewise, the record indicates that the rehabilitation of the building was done on a day-by-day basis rather than under the aegis of an overall design and development plan. It appears, however, that Cooper and his construction crew concentrated on the site work and refurbishing the exterior, while Heaps and the House of Interiors were charged with renovating the interior and adapting it for re-use as a mini-mall.
Materials for the interior were supplied by the appellants in the case sub judice, as well as the Lite House. Cooper and Heaps, as well as the site foreman, Bruce Burge, ordered materials as needed. Most were billed to the House of Interiors, but paid for with checks requiring the signatures of both Heaps and Cooper.
Late in 1986, as funds dwindled, Cooper and Heaps fell behind in the payments on the open accounts they held with their suppliers. One by one, construction and materialman's liens were filed against the property as follows:
Lienor Date Lien Filed Principal Amount
First National Bank 06/3/86 $410,000.00
Quick & Grice 12/9/86 $ 24,658.39
Allied Steel 12/18/86 $ 2,935.00
Park Supply 01/8/87 $ 13,093.91
The Lite House 3/30/87 $ 6,251.26
Thigpen Insurance 7/15/87 $ 6,093.08
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The appellees' liens were filed against the unimproved west side of the building only. Hibernia National Bank, successor to the failed First National Bank of St. Tammany Parish, purchased the renovated east side of the building at a foreclosure sale in September, 1989 for $378,000.00 and subsequently sold it to the County for $300,000.00 in May, 1990. Seeking to hasten foreclosure of the remaining half of the Chimney Square property, but fearing that a deficiency might leave their open accounts unpaid, the various construction and materialmen's lienors then instituted a series of claims against Cooper and Heaps.
David Diamond and James T. Bennett d/b/a The Lite House were the first to file suit. In a complaint against Bernard Heaps d/b/a The House of Interiors and the House of Interior Construction, Cooper, and the First National Bank of St. Tammany Parish, which had financed the project, they sought recovery of approximately $9,808.17 for lighting and electrical fixtures supplied to the project. Although Cooper appealed the August 17, 1987 judgment against him, this Court affirmed per curium the Circuit Court's decision in Carle Cooper v. David Diamond and James T. Bennett, Jr. d/b/a The Lite House, 554 So.2d 925 (Miss. 1989).
Following the judgment against Cooper, the Lite House amended its complaint to join as defendants the other lienholders: Quick & Grice, Park Supply Company, Allied Steel Corp. and Thigpen Insurance Agency. In a series of joinders and cross-claims, these parties sought to foreclose on their construction liens, to consent to a foreclosure sale, and to hold both Cooper and Heaps liable for any deficiencies that might result.
A hearing was held on April 1, 1988 and the Pearl River County Circuit Court entered its final order on May 31, 1988. The court found in favor of Thigpen Insurance Agency on the matter of an unpaid premium on an insurance policy Cooper had obtained on the Chimney Square project. However, as to the claims against Cooper asserted by Allied Steel, Park Supply and Quick & Grice, the court found that while entitled to their respective shares in any judgment against the Chimney Square property, they could not recover against Cooper personally because there was insufficient evidence to show that a partnership existed between Cooper and Heaps or that the parties had relied on the existence of a partnership when they provided materials for the Chimney Square project.
In June, 1988, Allied Steel, Quick & Grice and Thigpen Insurance Agency, as well as Park Supply Company, entered Motions for a New Trial. A hearing on the motions was held on July 1, 1988. The trial court overruled the motions.
The efforts by all four Appellees to enforce their liens had been thwarted further by Heaps' filing for bankruptcy in the U.S. Bankruptcy Court, Southern District of Mississippi. Those proceedings, however, were dismissed on June 1, 1989. On June 19, 1989, the Circuit Court ordered the sale of the property to satisfy some $67,166.90 in judgments against it owed the construction lien holders.
On June 26, 1989, the Circuit Clerk of Pearl River County issued a Special Writ of Execution pursuant to Miss.Code Ann. Sec. 85-7-153, directing the Sheriff to conduct a sale of the west side of the building known as the Old Blanket Factory in Picayune, Mississippi to satisfy the judgments. Notice of the sale was published in accordance with the provisions set forth in Miss.Code Ann. Sec. 89-1-55.
The sale was held on July 28, 1989 on the steps of the Pearl River County courthouse. Byron Stockstill, representing the appellees at sale, was the highest, best and only bidder. He conveyed to the Sheriff the sum of $1,000 and received the Sheriff's deed to the property. Following a flurry of motions by both Cooper and the Appellants, the Circuit Court entered a judgment on August 28, 1989, finding, in relevant part, that the Sheriff's sale was "proper and valid."
On June 11, 1990, Cooper filed a motion to set aside the Sheriff's sale and for other related relief. Hearings on this and a variety of other motions filed by Cooper were held on August 28, 1990. The Circuit Court heard testimony from the parties, as well as from two expert witnesses, real estate appraisers who had submitted written appraisals of the subject property. Finding that the sale served to satisfy $54,000.00 of the judgment against Cooper, the Circuit Court confirmed and ratified the sale and conveyance on February 28, 1991, and apportioned the credit on the indebtedness among the appellees.
Cooper I
Contrary to its earlier findings in the Diamond and Bennett litigation, the Circuit Court found that Cooper was not personally liable to the remaining construction lien holders because the relationship between Cooper and Heaps did not rise to the level of a partnership. Finding that the evidence in the record does not support the findings of the trial court, we reverse the decision of its decision in Cooper I.
In 1976, this state adopted the "Mississippi Uniform Partnership Law," Miss.Code Ann. Sec. 79-12-1 et seq. (1989 and Supp.1991). These provisions, a...
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