Canton Farm Equipment, Inc. v. Richardson

• Decision Date: 14 January 1987
• Docket Number: No. 57146,57146
• Parties: CANTON FARM EQUIPMENT, INC. v. David RICHARDSON, J.L. McCullough, Karl Banks, J.S. Harris, Jr., Individually and in Their Capacities as Supervisors of Madison County, Mississippi; and Tubb-Williamson, Inc.
• Court: Mississippi Supreme Court

Page 1098

501 So.2d 1098

CANTON FARM EQUIPMENT, INC. v. David RICHARDSON, J.L. McCullough, Karl Banks, J.S. Harris,

Jr., Individually and in Their Capacities as

Supervisors of Madison County,

Mississippi; and

Tubb-Williamson,

Inc.

No. 57146.

Supreme Court of Mississippi.

Jan. 14, 1987.

Rehearing Denied Feb. 11, 1987.

Stanley F. Stater, III, Canton, for appellant.

Lee B. Agnew, Jr., Jackson, C.R. Montgomery, Rebecca B. Cowan, Montgomery, Smith-Vaniz & McGraw, Canton, for appellee.

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

ROBERTSON, Justice, for the Court:

I

This appeal arises from a heavy equipment vendor's challenge to a board of supervisors rejection of his low bid for sale to the county of two backhoes. Laden within this appeal are important questions regarding subject matter jurisdiction, the adequacy of the disappointed bidder's pleadings when challenged under Rule 12(b)(6), Miss.R.Civ.P., and the standing of the plaintiff to bring the action. For the reasons explained below, we reverse and remand with directions.

II

On October 2, 1984, Canton Farm Equipment, Inc. (sometimes "Canton"), Plaintiff below and Appellant here, commenced these proceedings by filing its Complaint in the Chancery Court of Madison County, Mississippi. Canton Farm Equipment, Inc. is a Mississippi corporation domiciled and having its principal place of business on Highway 22 West in Canton, Mississippi.

The complaint asserted various illegalities regarding the purchase of two backhoes by the Madison County Board of Supervisors, one each for Districts 3 and 5. Named as Defendants were David Richardson, J.L. McCullough, Karl Banks and J.S. Harris, Jr., individually and in their capacities as Supervisors of Madison County, Mississippi. ¹ These four Supervisors are Appellees here. Also named as a Defendant was Tubb-Williamson, Inc., a corporation, the apparent successful bidder. In its capacity as an unsuccessful bidder, Canton Farm Equipment demanded that the purchase of the backhoes from Tubb-Williamson be voided and that the Supervisors be directed to accept Canton's bid.

Beyond that, Canton Farm Equipment demanded that, for their misconduct in the purchase of the backhoes, the Supervisors should be assessed penalties and damages, to-wit: that the Defendants be required individually to pay back to the county the entire sum paid to Tubb-Williamson, Inc. and also be required to pay $5,000.00 in penalties individually and on their bonds, in accordance with Miss.Code Ann. Sec. 31-7-57 (Supp.1985).

Apparently the Madison County Board of Supervisors had on at least four separate occasions advertised for bids for the purchase of two backhoes by the county. The last of these advertisements appears to have resulted in the submission of bids on September 14, 1984, "for the lease purchase ... of two new or slightly used rubber tired backhoe[s]."

For District 3, the bids submitted for a 36 month lease purchase contract were

Canton Ford Tractor (Canton $885.29 per month

Farm Equipment, Inc.)

Tubb-Williamson Co. $888.70 per month

Canton Farm Equipment was the apparent low bidder by some $3.41 per month.

For District 5, the bids submitted for a 36 month lease purchase contract were

Canton Ford Tractor (Canton $752.91 per month

Farm Equipment, Inc.)

Tubb-Williamson Co. $775.09 per month

Canton Farm Equipment was the apparent low bidder by some $22.18 per month.

On September 24, 1984, the Supervisors considered the bids and, upon motion duly made and seconded, determined to accept the bid of Tubb-Williamson for the purchase of each backhoe. The Supervisors' minutes acknowledged that "dollar-wise" Canton Farm Equipment "submitted the lowest bid for each backhoe" but further recited that the bid would be awarded to Tubb-Williamson for five reasons: "(1) lower maintenance costs, (2) better quality equipment, (3) operators familiar with equipment, (4) equipment demonstrated and used on jobsite and (5) more durable equipment." See Miss.Code Ann. Sec. 31-7-13(d) (Supp.1986). Noticeably, the minutes did not suggest that the Canton Farm Equipment bids failed to conform with specifications in the advertisement.

It was in the above setting that some eight days later, on October 2, 1984, Canton Farm Equipment commenced this action by filing its complaint in the Chancery Court of Madison County. Canton alleged that it should have been awarded the contracts on the basis that it had submitted bids which met the specifications advertised and that its prices were the lowest submitted for each backhoe. Canton also charged that the entire transaction should be declared void because the advertisement published [in accordance with which the parties submitted their bids] failed to conform with the Board's authorization. Canton attached to its Complaint a copy of the minutes of August 20, 1984, which authorize and direct advertisement for bids for purchase of the backhoes on a "cash purchase basis." For whatever reason, when published the notice called instead for lease purchase bids. It appears that no one submitted a cash purchase bid.

The Supervisors moved to dismiss Canton's complaint, asserting lack of subject matter jurisdiction in the Chancery Court, failure to state a claim upon which relief could be granted, and that Canton's exclusive remedy was an appeal to the Circuit Court under Miss.Code Ann. Sec. 11-51-75 (Supp.1985). On March 26, 1985, the Chancery Court entered its order directing that the entire matter be transferred to the Circuit Court of Madison County, Mississippi. In that order the Chancery Court gave as its reason for transfer "that Canton Farm Equipment, Inc. has a full and adequate remedy at law."

Once the matter was before the Circuit Court, Canton Farm Equipment amended its complaint so that it was broken down into four counts and four claims for relief. In Count 1, Canton charged that the purchase of the backhoes from Tubb-Williamson was void because the Board had authorized advertisement for cash purchase but instead the published notices had referred to lease purchase bids and in fact the bids submitted had been on a lease purchase basis. Canton demanded that the transaction with Tubb-Williamson be voided and that all monies paid on that transaction be returned to the Madison County treasury.

In Count 2, Canton charged that over a period of six months the Supervisors engaged upon a concerted course to acquire the backhoes from Tubb-Williamson in disregard for the statutorily mandated procedures whereby a county board of supervisors may purchase equipment for public use. See Miss.Code Ann. Secs. 19-13-17 and 31-7-13 (Supp.1986). The complaint charges that the Board advertised for new backhoes, that the backhoes were delivered by Tubb-Williamson for demonstration purposes in the spring of 1984, that thereafter on three separate occasions advertisements for the purchase of new backhoes were published, and that on each such occasion the bids received were rejected because Tubb-Williamson was not the low bidder. Then on the publication in September of 1984 described above the advertisement was changed to solicit bids for the county's purchase of "a new or slightly used backhoe", as this would allow purchase of the backhoes which had been delivered as demonstrators by Tubb-Williamson back in the spring of 1984. As relief Canton demanded judgment against the Supervisors requiring them to reimburse Madison County for all sums which they illegally spent and further for judgment in the amount of $5,000.00 under Miss.Code Ann. Sec. 31-7-57 (Supp.1985).

In Count 3, Canton charged the Supervisors with a scheme to defraud it and the other taxpayers of Madison County by purchasing the two backhoes without following the lawful guidelines required for such a purchase. As relief Canton sought assessment of civil or criminal penalties.

In Count 4, Canton set forth a claim that it had submitted the lowest and best bid and that its bid should have been accepted by the Board of Supervisors of Madison County. Count 4 also referred to a five page, fifteen paragraph section of the amended complaint entitled "Statement of Facts In Lieu of Bill of Exceptions" and claimed that such was submitted in the event that an appeal under Miss.Code Ann. Sec. 11-51-75 be deemed its sole remedy. As relief Canton asked the court to order the Supervisors to "follow the law and purchase the two backhoes from the lowest and best bidder, Canton Farm Equipment, Inc."

In response the Supervisors moved pursuant to Rule 12(b)(6), Miss.R.Civ.P., to dismiss by reason of Canton's alleged failure to state a claim upon which relief could be granted. In due course the matter came on for hearing before the Circuit Court which held that Canton Farm Equipment, Inc., as Plaintiff, "does not have the standing to bring this suit." On December 18, 1985, the amended complaint was finally dismissed. Canton Farm Equipment, Inc. has perfected this appeal.

III

Our first questions concern subject matter jurisdiction and the timeliness of this action. When Canton brought its original action in the Chancery Court of Madison County, the Supervisors moved to dismiss for Canton had "a full and adequate remedy at law." On March 19, 1985, the Chancery Court expressly so found but, instead of dismissing, transferred the matter to the Circuit Court of Madison County.

After transfer and after Canton filed its amended complaint, the Supervisors decided that Canton's law remedy was not so adequate after all, as they then moved to dismiss for failure to state a claim under Rule 12(b)(6), Miss.R.Civ.P. Among other points, the Supervisors argued below--as they do here--that Canton's Circuit Court proceedings were not brought within the ten day time frame contemplated by Miss.Code Ann. Sec. 11-51-75 (1972). ² They argued this even though the original complaint was filed in Chancery Court on October 2, 1984, only the eighth day following the order of the Board of Supervisors...