Donald v. Amoco Production Co., 97-CA-01178-SCT.

• Citation: 735 So.2d 161
• Decision Date: 25 March 1999
• Docket Number: No. 97-CA-01178-SCT.,97-CA-01178-SCT.
• Parties: Gerald DONALD v. AMOCO PRODUCTION CO., Atlantic Richfield Company, Bass Enterprises Production Co., Champlin Petroleum Company, Chevron Corporation, Chevron U.S.A., Inc., Coho Resources, Inc., Conoco, Inc., Conquest Exploration Co., Exxon Corporation, Fina Oil and Chemical Company, Four Star Oil & Gas Co., Huseman Oil & Royalty, Inc., Inexco Oil Company, Moon-Hines-Tigrett Operating Co., Inc., Mobil Oil Exploration & Producing Southeast, Inc., Murphy Oil USA, Inc., Oryx Energy Company, Oxy USA, Inc., Phillips Petroleum Co., Placid Oil Company, Shell Western E & P, Inc., Tenneco Oil Company, Texaco, Inc., Union Oil Company of California, Vintage Petroleum, Inc., and BankPlus.
• Court: Mississippi Supreme Court

735 So.2d 161

Gerald DONALD v. AMOCO PRODUCTION CO., Atlantic Richfield Company, Bass Enterprises Production Co., Champlin Petroleum Company, Chevron Corporation, Chevron U.S.A., Inc., Coho Resources, Inc., Conoco, Inc., Conquest Exploration Co., Exxon Corporation, Fina Oil and Chemical Company, Four Star Oil & Gas Co., Huseman Oil & Royalty, Inc., Inexco Oil Company, Moon-Hines-Tigrett Operating Co., Inc., Mobil Oil Exploration & Producing Southeast, Inc., Murphy Oil USA, Inc., Oryx Energy Company, Oxy USA, Inc., Phillips Petroleum Co., Placid Oil Company, Shell Western E & P, Inc., Tenneco Oil Company, Texaco, Inc., Union Oil Company of California, Vintage Petroleum, Inc., and BankPlus.

No. 97-CA-01178-SCT.

Supreme Court of Mississippi.

March 25, 1999.

Rehearing Denied May 20, 1999.

John W. Boling, Meridian, Stuart H. Smith, James R. Cox, Michael G. Stag, New Orleans, LA, Attorneys for Appellant.

Jeffery P. Reynolds, Thomas L. Kirkland, Jr., William T. Wilkins, Jackson, C. Glen Bush, Thomas R. Hudson, Ridgeland, Attorneys for Appellees.

EN BANC.

SMITH, Justice, for the Court:

STATEMENT OF THE CASE

Statement of the Facts

¶ 1. On August 16, 1991, Gerald Donald ("Donald") bought a 20 acre parcel (the "property") in Wayne County, Mississippi, for the appraised value. He acquired title to the property by quitclaim deed from the Bank of Waynesboro (now "BankPlus") which had seized the property at foreclosure. The former owners, the Davis Brothers, were in the business of providing oil well maintenance services to various oil companies. In his Complaint, Donald alleges that Davis Brothers transported the oil field waste to the property and disposed of it there. He discovered the waste in 1995.

Procedural History

¶ 2. On May 17, 1996, Donald filed his complaint in the Circuit Court of Hinds County, Mississippi. Donald named Bank-Plus ("BankPlus") as a defendant claiming negligent misrepresentation on the condition of the property. Donald also named several oil companies (hereafter "Oil Defendants"; collectively with BankPlus as the "Defendants") who contracted with Davis Brothers alleging seven causes of action including negligence, nuisance, trespass to land, breach of contract, waste, strict liability, and outrageous conduct.

¶ 3. On June 18, 1996, the Defendants filed a Notice of Removal in the U.S. District Court, Southern District of Mississippi, Jackson Division. Donald then filed an Amended Complaint in state and federal courts on June 19, 1996. On July 17, 1996, Donald filed a Motion for Remand. On March 31, 1997, the U.S. District Court remanded the case to state court.

¶ 4. On April 7, 1997, Defendants filed a Motion for Change of Venue, requesting that venue be transferred to Wayne County, predicating said motion the local action doctrine as codified in Mississippi Code Ann. § 11-11-3 (Supp.1998) and the doctrine of forum non conveniens. On April 17, 1997, Donald again amended his complaint naming additional defendants and removing the claim for trespass to land. On April 18, 1997, Hinds County Circuit Court Judge Breland Hilburn held a hearing to consider the change of venue motion. On May 13, 1997, Judge Hilburn ordered the transfer of the case to the Circuit Court of Wayne County, Mississippi, where the subject property is located.

¶ 5. On May 28, 1997, Donald filed a Motion to Reconsider the Venue Transfer in the Circuit Court of Wayne County, because the record had already been transferred there. On July 9, 1992, Wayne County Circuit Judge Larry Eugene Roberts held a hearing at which the court denied the motion and set a date to hear argument on the Defendants' Motions to Dismiss. On August 22, 1997, a hearing was held to consider the Defendants' Motions to Dismiss. On September 3, 1997, the Circuit Court issued a Memorandum Opinion granting the Motions to Dismiss under Rule 12(b)(6) of the Mississippi Rules of Civil Procedure. The Final Judgment with Prejudice was signed on September 9, 1997.

¶ 6. Aggrieved, Donald now appeals to this Court and raises the following contentions:

I. THE LOWER COURT ERRED WHEN IT DISMISSED THE AMENDED COMPLAINT BECAUSE A CAUSE OF ACTION DOES NOT ACCRUE UNTIL A PLAINTIFF DISCOVERS OR SHOULD HAVE DISCOVERED THE DAMAGES.

II. THE LOWER COURT ERRED WHEN IT DISMISSED BASED UPON THE PRIOR TRESPASS DOCTRINE BECAUSE IT IS INAPPLICABLE TO THE CAUSES OF ACTION STATED.

III. THE LOWER COURT ERRED IN DISMISSING THE CASE BECAUSE THE DEFENDANTS CREATED A NUISANCE BY FAILING TO PROPERLY DISPOSE OF THE WASTE PRODUCED IN THEIR OPERATIONS.

IV. THE LOWER COURT ERRED IN DISMISSING THE CLAIM FOR STRICT LIABILITY FOR CONDUCTING AN ABNORMALLY DANGEROUS ACTIVITY.

V. THE DEFENDANTS COMMITTED STATUTORY WASTE.

VI. THE LOWER COURT ERRED WHEN IT HELD DONALD TO BE TOO REMOTE FROM THE OIL COMPANIES' NEGLIGENCE IN BREACHING THEIR DUTY TO PROTECT OTHERS FROM THE HAZARDOUS WASTE PRODUCED.

VII. THE LOWER COURT ERRED IN DISMISSING THE BREACH OF CONTRACT CLAIM.

VIII. THE LOWER COURT ERRED IN DISMISSING OUTRAGEOUS CONDUCT CAUSE OF ACTION.

IX. THE LOWER COURT ERRED IN DISMISSING NEGLIGENT MISREPRESENTATION CLAIM AGAINST BANKPLUS.

X. THE TRANSFER OF VENUE TO WAYNE COUNTY FROM HINDS COUNTY WAS IMPROPER.

STANDARD OF REVIEW

¶ 7. A motion to dismiss under Miss.R.Civ.P. 12(b)(6) raises an issue of law. Tucker v. Hinds County, 558 So.2d 869, 872 (Miss.1990); Lester Eng. Co. v. Richland Water and Sewer Dist., 504 So.2d 1185, 1187 (Miss.1987). This Court conducts de novo review on questions of law. Mississippi Transp. Comm'n v. Fires, 693 So.2d 917, 920 (Miss.1997); UHS-Qualicare, Inc. v. Gulf Coast Community Hosp., Inc., 525 So.2d 746, 754 (Miss.1987).

¶ 8. When considering a motion to dismiss, the allegations in the complaint must be taken as true, and the motion should not be granted unless it appears beyond doubt that the plaintiff will be unable to prove any set of facts in support of his claim. Butler v. Board of Supervisors, 659 So.2d 578, 581 (Miss.1995); Overstreet v. Merlos, 570 So.2d 1196, 1197 (Miss.1990).

LEGAL ANALYSIS

I. THE LOWER COURT ERRED WHEN IT DISMISSED THE AMENDED COMPLAINT BECAUSE A CAUSE OF ACTION DOES NOT ACCRUE UNTIL A PLAINTIFF DISCOVERS OR SHOULD HAVE DISCOVERED THE DAMAGES.

¶ 9. The lower court concluded "the complaint shall be dismissed as time-barred by the applicable statute of limitations," Miss. Code Ann. § 15-1-49, because he purchased the property on August 16, 1991, and filed his complaint on May 17, 1996. Despite filing his complaint almost five years after acquiring the property, Donald asserts this ruling to be in error for failure to apply the discovery exception. He claims that this Court has applied the discovery exception previously to preserve a cause of action where damages are "undiscoverable." Alternatively, he argues that federal law preempts state law to furnish a discovery rule.

A. The State Discovery Exception Applies to Claims for Property Damages.

¶ 10. Section 15-1-49 states:

(1) All actions for which no other period of limitation is prescribed shall be commenced within three (3) years next after the cause of such action accrued, and not after.

(2) In actions for which no other period of limitation is prescribed and which involve latent injury or disease, the cause of action does not accrue until the plaintiff has discovered, or by reasonable diligence should have discovered, the injury.

(3) The provisions of subsection (2) of this section shall apply to all pending and subsequently filed actions.

Miss.Code Ann. § 15-1-49 (1995)(emphasis added). Donald asserts that the discovery exception has been interpreted by this Court to preserve any undiscovered claim. In this case, the contamination caused by the Defendants is invisible and therefore "inherently undiscoverable."

¶ 11. As authority for his contentions, Donald cites several of this Court's cases. A discovery exception has been applied in legal malpractice cases; See Smith v. Sneed, 638 So.2d 1252 (Miss.1994)

(statute of limitations in legal malpractice begins to run on date client learns or should have learned of lawyer's negligence); in defamation cases; Staheli v. Smith, 548 So.2d 1299 (Miss.1989) (discovery rule applies to time of accrual of defamation action under Miss.Code Ann. § 15-1-35); in bodily injury cases; Williams v. Kilgore, 618 So.2d 51 (Miss.1992); (discovery rule applied to medical malpractice actions involving latent injuries); and in worker's compensation cases; Benoist Elevator Co. v. Mitchell, 485 So.2d 1068 (Miss.1986) (application of discovery rule to Miss.Code Ann. § 71-3-35(1) for worker's compensation benefits for latent injuries).

¶ 12. Specifically, Donald asserts that the discovery exception should apply, because the presence of radioactive waste was detectable only through the use of a survey meter and the waste was buried in pits. This waste includes radioactive material produced by oil and gas exploration which was not apparent nor discovered prior to 1995. He looks to the theory behind why the Legislature and this Court first adopted such exceptions. In holding that the discovery exception applies to medical malpractice actions, this Court stated, "If the statute is ambiguous, we place upon it a construction which favors preservation of the plaintiff's cause of action." Williams, 618 So.2d at 55. It is well established that the statute of limitations does not run against one who has neither actual nor constructive notice of the facts that would entitle him to bring an action. Id. Furthermore, the Legislature adopted the discovery rule because it is illogical to bar an action before its existence is known. Owens-Illinois, Inc. v. Edwards, 573 So.2d 704, 708 (Miss.1990). Likewise, Donald argues it is illogical to bar an inherently undiscovered claim for property damage.

¶ 13. In contrast, the Defendants argue a cause of action accrues and the statute begins to run on the day of the wrongful act or no later than the date an injury...