Cenac v. Murry, 89-CA-0499

• Decision Date: 26 August 1992
• Docket Number: No. 89-CA-0499,89-CA-0499
• Citation: 609 So.2d 1257
• Parties: Rebecca L. CENAC and Norman Cenac v. Carl Wesley MURRY, Sr. and Shirley Ann Murry.
• Court: Mississippi Supreme Court

Page 1257

609 So.2d 1257

Rebecca L. CENAC and Norman Cenac v. Carl Wesley MURRY, Sr. and Shirley Ann Murry.

No. 89-CA-0499.

Supreme Court of Mississippi.

Aug. 26, 1992.

Frank D. Montague, Jr., Montague Pittman Rogers & Schwartz, Hattiesburg, for appellants.

Lawrence D. Arrington, Hattiesburg, for appellees.

Before DAN M. LEE, P.J., and ROBERTSON and McRAE, JJ.

DAN M. LEE, Presiding Justice, for the Court:

This is an appeal from the Forrest County Chancery Court from a final judgment entered on March 16, 1989. The appellant Soon after the Cenacs moved into the store and took over the business from the Murrys, severe problems emerged between the parties. Eventually, the Cenacs filed a complaint in the Forrest County Chancery Court wherein they sought rescission of the contract. In sum, the Cenacs wanted to undo the deal that they had made with the Murrys and be returned to their pre-contract status. The case proceeded to trial in the Forrest County Chancery Court. At the end of trial, the chancellor made a bench ruling wherein he denied the Cenacs any substantive relief. On March 16, 1989, the lower court entered a "judgment" wherein the prior bench opinion was adopted as the Final Judgment of the chancery court.

Rebecca Cenac, entered into a "Contract For Deed" as the purchaser of a little country store in McLaurin, Mississippi, and the Murrys, appellees, were the sellers.

Feeling aggrieved, the Cenacs have now appealed to this Court alleging error by the court below and seeking the same relief that was denied in the lower court. After a careful review of this unusual and interesting case, we find that the lower court did not err in declining to grant the requested relief of rescission of the contract. However, we do find that the Cenacs have clearly proved that the Murrys breached the covenant of good faith inherent in every contract in our law. Consequently, we reverse the final judgment and remand the case to the Forrest County Chancery Court with instruction to the lower court to conduct a hearing in order to determine the appropriate measure of damages for the Cenacs, along with an allowance of reasonable attorney's fees and punitive damages.

The facts of this case are voluminous, yet crucial to the issues which we resolve. We begin with a detailed explanation of the procedural history which has brought us this far followed by the pertinent facts.

I. PROCEDURAL HISTORY

Rebecca L. Cenac, a Mississippi native, and her husband, Norman Cenac, were residents of Houma, Louisiana, who enjoyed camping in Mississippi at the Paul B. Johnson State Park in Forrest County. From time to time the Cenacs had discussed retiring in Mississippi and buying a little country store somewhere in close proximity to the park. However, the Cenacs acted on their plans prior to reaching retirement age. Norman Cenac worked offshore in the oil business, and in the mid 1980s when the bottom dropped out of the petroleum economy, the Cenacs had an immediate need to find another more stable source of income. Consequently, the Cenacs entered the market to purchase a country store. After making a few contacts in the area, the Cenacs met Carl and Shirley Murry, who owned a country store and bait shop near the park in McLaurin, Mississippi. When approached by the Cenacs, the Murrys were "nice as pie" and seemed interested in selling their store. Negotiations ensued, and eventually a deal was struck. The Cenacs proceeded with plans to buy the store, and they moved to Mississippi. Little did the Cenacs know that it was a deal that they would soon regret.

On June 11, 1986, Carl Wesley Murry, Sr., and Shirley Ann Murry, husband and wife, entered into an agreement with Rebecca L. Cenac. Norman Cenac was not a party to the agreement. Rather than executing and delivering a deed to Mrs. Cenac secured with a deed of trust in the Murrys' favor along with a promissory note, the parties entered into a "Contract For Deed," which is much like a conditional sales contract. Mrs. Cenac paid the Murrys $30,000.00 as a down payment for the store, with a balance of $70,000.00 to be paid in monthly installments of $925.00 per month for the next ten years at 10% interest. The Murrys, as sellers, agreed that, if Mrs. Cenac made all of the monthly notes, they would convey title of the store to her by way of a warranty deed. Therefore, a deed to the store and property was not to pass from seller to buyer until the end of ten years, 1996, once all of the payment obligations under the contract had been fulfilled by Mrs. Cenac.

The contract also contained the following forfeiture clause which "speaks" for itself 4. In case of the failure of the purchaser to make any of the payments herein designated, or any part thereof, or failure to perform any of the other covenants contained in this agreement, this agreement shall be forfeited and terminated within ten days after receipt of notice by the sellers of their intent to deem this contract breached, and should the same occur, all payments on this contract shall be retained by the sellers as due or accumulated rent on the property, and should a default occur, the purchaser hereby agrees that she will vacate the premises immediately upon request by the sellers, and the sellers may take possession of the premises without being liable for any action therefor and without the necessity of any legal. (sic) Further, the purchaser shall not destroy, damage or substantially change waste. If default does occur in this contract, the purchaser agrees that she will return said property in substantially the same condition as when she took control of said property if she will preserve said property and maintain said property.

Additionally, Mrs. Cenac, as purchaser, agreed to pay all the property taxes on the store and to retain hazard insurance from the date of the contract until the property was either conveyed or the contract forfeited. In the contract, the Murrys promised that they would not go into the convenience store, grocery store, gas business, or similar business within a ten-mile radius of the property being "purchased."

A final clause in the agreement stated that, if the purchaser chose not to exercise her right to purchase, the contract would become null and void, and all rights of the purchaser would be forfeited and terminated. All money and other consideration paid by the purchaser to the seller would be retained by the sellers free of any claim from the purchaser, it being agreed that such sums constitute a reasonable rental fee for the property and a reasonable sum as liquidated damages to the sellers if the right to purchase were not exercised.

On December 10, 1987, approximately 18 months after executing the contract, Mrs. Cenac filed a complaint in the Forrest County Chancery Court against Carl Wesley Murry, Sr., and Shirley Ann Murry. In her lawsuit, Mrs. Cenac alleged willful misrepresentation, tortious misconduct, and business interference. Mrs. Cenac sought cancellation and rescission of the contract, a refund of all sums paid, as well as actual and punitive damages. In the complaint, Mrs. Cenac alleged that Carl Murry falsely represented that the roof of the store was sound and would not leak; that the store property was "half an acre" when in reality it was only .297 acre; and that Carl Murry had disrupted septic service to the store. Regarding interference with business relations, Mrs. Cenac alleged that Mr. Murry had engaged in a course of interference and intimidation coupled with bizarre and aberrant behavior directed at the Cenac's family as part of a premeditated design to force a forfeiture and recover the store.

Specifically, Mrs. Cenac requested the following relief in her suit:

(1) Rescinding and cancelling the contract for deed in exchange for the defendants' payment to plaintiff of all sums received from plaintiff pursuant to said contract;

(2) Temporarily and permanently restraining and enjoining the defendant Carl Wesley Murry, Sr., from his acts of threats, harassment, business interference and intimidation;

(3) Ordering the defendants to pay to the plaintiff reasonable attorney's fees of plaintiff's attorney in this behalf expended;

(4) Directing the restoration of septic tank service to the subject property; and

(5) Awarding the plaintiff $100,000.00 punitive damages against the defendant, Carl W. Murry, Sr.

As this litigation developed, Mrs. Cenac's husband, Norman Cenac, was added as a party plaintiff by agreed order of the parties in January of 1988. As one might expect in a case such as this, there is tremendous rancor and spite between the parties. Although this record is not very clear, it appears that there was at least one hearing for temporary relief held in the This matter finally proceeded to a hearing on the Cenacs' complaint and requested relief in March of 1989. The judgment entered by the lower court merely adopted the bench opinion as the "Final Judgment" with one minor exception. Prior to the trial, the parties reached an agreement concerning the correct legal description of the store property, and the judgment ordered the Murrys to convey to the Cenacs an appropriate instrument correcting the land description in the "Contract For Deed." In the bench opinion, the chancellor denied all relief requested by the Cenacs with little explanation. The bench opinion recited the following reason for denying relief:

chancery court prior to hearing on the merits of Mrs. Cenac's complaint. On January 29, 1989, Chancellor Patterson entered an order for temporary relief wherein it was ordered that the Cenacs and the Murrys shall be permitted exclusive occupancy and enjoyment of their respective property, free from any verbal or physical harassment, intimidation, threats, or physical force by the opposite parties, and that no such party shall engage in any activity directed toward any of the other parties. On May 19, 1989, the Cenacs filed a petition for citation for...