Milligan v. Milligan, 2005-CA-01413-COA.

• Decision Date: 15 May 2007
• Docket Number: No. 2005-CA-01413-COA.,2005-CA-01413-COA.
• Citation: 956 So.2d 1066
• Parties: Timothy MILLIGAN, Individually and as an Heir of the Estate of Jackie R. Milligan, Appellant, v. Mary V. MILLIGAN, Individually and as Trustee of the Jackie R. Milligan Testamentary Trust and Milligan's Ready Mix, Inc. and Kelly Kirk Milligan, Appellees.
• Court: Mississippi Court of Appeals

956 So.2d 1066

Timothy MILLIGAN, Individually and as an Heir of the Estate of Jackie R. Milligan, Appellant, v. Mary V. MILLIGAN, Individually and as Trustee of the Jackie R. Milligan Testamentary Trust and Milligan's Ready Mix, Inc. and Kelly Kirk Milligan, Appellees.

No. 2005-CA-01413-COA.

Court of Appeals of Mississippi.

May 15, 2007.

Brian H. Neely, Tupelo, attorney for appellant.

Michael Dale Cooke, Iuka, attorney for appellees.

Before MYERS, P.J., IRVING and BARNES, JJ.

BARNES, J., for the Court.

¶ 1. Timothy Milligan appeals the judgment of the Chancery Court of Tishomingo County which ruled in favor of defendants Milligan's Ready Mix, Inc., and Kelly Kirk Milligan. Timothy argues the trial court erred in the following: its dismissing his claim of partial ownership of the "family" business of Milligan's Ready Mix, Inc.¹ and the real property upon which the business is located; failing to determine the type of business entity MRM operated as at the time of his father's death; and granting summary judgment regarding his right to damages. Finding no error, we affirm.

STATEMENT OF FACTS AND PROCEDURAL HISTORY

¶ 2. MRM is a concrete mixing and form business located in Iuka, Mississippi. The business has been in the Milligan family for several decades. This dispute began over MRM's storing its large concrete products on a portion of a tract of property devised to Timothy in 1995 by his father, Jackie Milligan. Pursuant to Jackie's will, Timothy's step-mother, Mary Milligan, held the tract of land in trust for Timothy until he reached the age of fifty. An initial complaint was filed by Timothy in July of 2001 against Mary Milligan, individually and as trustee of Jackie's estate, and Milligan's Ready Mix, Inc. Timothy complained of storage by MRM of large concrete products on approximately a one-half acre portion of his property. Timothy also complained of the encroachment onto his property of a metal building owned by MRM. Timothy ultimately filed a second amended complaint in June of 2004, expanding his claims to include a one-half ownership interest in MRM's property and business. Additionally, he added another defendant, his uncle, Kelly Kirk Milligan, who currently operates the business.

¶ 3. Because the business's chain of title is in dispute, the history of the business must be explained from its inception. "Milligan's Ready Mix"² was founded around 1958 by Timothy's grandfather, Kell Milligan, as a sole proprietorship. At that time, Kell bought the property of the business's present location in Tishomingo County. In the 1960s the business continued to develop under Kell and his two sons, Jackie and Kelly, as a family business. It is undisputed that in 1979, Kell, via warranty deed, conveyed the property upon which MRM is located to his sons Jackie and Kelly.

¶ 4. The current dispute centers around three instruments: a warranty deed, a deed of trust, and a promissory note. The warranty deed conveyed the MRM real property from Kelly and Jackie to "Milligan Brothers Ready Mix, Inc." on November 1, 1986. However, at this time, while there was evidence submitted to the court that "Milligan's Brothers Ready Mix, Inc." operated as a corporation, the business was not incorporated at the Mississippi Secretary of State's office until May 23, 1988, when the business entity "Milligan's Ready Mix, Inc." was incorporated. In sum, Timothy claims that because "Milligan Brothers Ready Mix, Inc." was not officially incorporated at the time the warranty deed was executed, or in fact at any time,³ the 1986 warranty deed is invalid, and thus Jackie never sold his one-half interest in the property. Upon Jackie's death, Timothy claims he was entitled to a one-half interest in the real property and proceeds from the business.

¶ 5. Pertinent documents submitted into evidence included a deed of trust, also signed on November 1, 1986, from "Milligan Brothers Ready Mix, Inc." to Jackie to secure payment of $82,500 at the rate of eight percent per annum for Jackie's interest in the MRM real property. The deed of trust stated "Milligan's Brothers Ready Mix, Inc." was to pay Jackie $10,000 per year for fourteen years. Further, a promissory note dated October 31, 1986, granted Jackie $82,500 from "Milligan Brothers Ready Mix, Inc.," under the same terms as the deed of trust. Kelly Milligan and Ann Harwell, Kelly's sister, signed the note respectively as president and secretary/treasurer of Milligan Brothers Ready Mix, Inc.⁴

¶ 6. In July of 1995, Jackie Mulligan passed away, leaving a will which devised most of his estate to his wife, Mary, and son, Timothy. Timothy was bequeathed the parcel of land adjacent to the Milligan's Ready Mix business by his father. Jackie had purchased this property from T.B. Woodruff in 1971; it is adjacent to but not a part of the MRM property. Pursuant to Jackie's will, the Woodruff property was held in trust for Timothy, with Timothy's step-mother, Mary, serving as trustee until Timothy reached the age of fifty, at which point all proceeds of the trust would be his.⁵ Also, upon Jackie's death, Timothy moved into a home on this property. Large concrete products were stored by MRM on a portion of this property since the 1980s, because of space constraints on the ready-mix property, but with Jackie's permission. Additionally, the metal building, constructed in the early 1970s, was also partially on the MRM property and partially on Timothy's property by agreement of Jackie.

¶ 7. Regarding the ready mix business, Jackie's will only mentioned the following: "I give and bequeath to my son Timothy . . . the balance of the proceeds due me from a note receivable from Milligan Brothers Ready Mix, Inc." No mention was made in the will regarding Jackie's retaining any ownership interest in the ready mix business. At trial, receipts were entered into evidence showing that after Jackie died, "Milligan's Ready Mix, Inc." properly began paying Timothy $10,000 per year commencing in 1995, concluding with a "paid in full" receipt on August 2000. Total funds paid to Timothy after his father's death were $60,169.28.⁶

¶ 8. As previously stated, this dispute first began in July 2001 as an apparent attempt by Timothy to rid his property of the large concrete products stored for several years by MRM and to receive compensation for the encroachment of the metal building on his property. In his first complaint, Timothy also complained that Mary had refused to stop the uncompensated use and damage to his property and was thus negligent as trustee of his property. In response to this complaint, Milligan's Ready Mix, Inc. and Kelly made a counterclaim seeking Timothy's parcel of land by adverse possession, noting the concrete products and metal garage had been on this property for over ten years. Timothy, however, did not sue for partial ownership of the ready mix business until his second amended complaint of June 2004, filed by new counsel. In the revised complaint, he sought one-half of the assets of "Milligan's Ready Mix, Inc.," $2 million in damages for his deprivation of interest in the business, $2,000 per month for compensation of the use of his property, or alternatively an order directing Milligan's Ready Mix, Inc. to remove the materials from his land, and compensation for any damage to his property. In response, Milligan's Ready Mix, Inc. and Kelly renewed their adverse possession counterclaim.

¶ 9. In January 2005, defendants Milligan's Ready Mix, Inc. and Kelly filed a motion for partial summary judgment which was granted in part. The chancellor stated there was no genuine issue of material fact for the following claims: $2 million in damages or for any other amount against Milligan's Ready Mix, Inc. and Kelly, $2,000 per month rent on the disputed property, and any damages to Timothy's property by MRM or Kelly. The chancellor excepted, however, any potential claim to damages of Timothy's property by the adverse use by Milligan's Ready Mix, Inc. The chancellor denied summary judgment for two claims: Timothy's claim to one-half of the assets of Milligan's Ready Mix, Inc. and the defendants' counterclaim of adverse possession on the portion of the metal building that allegedly encroached on Timothy's property.

¶ 10. A bench trial occurred on May 9, 2005, before the Chancery Court of Tishomingo County. The remaining two claims were heard on the merits. Timothy called two witnesses during his case-in-chief: Kelly as an adverse witness and Mary Milligan. Timothy then rested. Next, the chancellor granted defendant Mary's oral motion for an involuntary dismissal against her as trustee. The remaining two defendants then moved for an involuntary dismissal regarding Timothy's claim to one-half interest in Milligan's Ready Mix, Inc., which the chancellor granted. Thus the only remaining claim for adjudication was the defendants' adverse possession counterclaim against Timothy. After hearing testimony, the chancellor dismissed the adverse possession claim. On June 14, 2005, a final order was entered whereby Milligan's Ready Mix, Inc. was ordered to remove all of its personalty from the disputed property within ninety days. Timothy timely appealed to this Court, challenging the judgment in favor of Milligan's Ready Mix, Inc. and Kelly Kirk Milligan.⁷

STANDARD OF REVIEW

¶ 11. "The sufficiency of the evidence is determined by the chancellor, who sits as finder of fact and makes determinations as to the weight and credibility of the evidence." Peters v. Peters, 906 So.2d 64, 68(¶ 12) (Miss.Ct.App.2004). Our standard of review is a limited one for a chancellor's findings of fact. This Court will not disturb a chancellor's findings unless clearly erroneous, manifestly wrong, or an erroneous legal standard was applied. Sanderson v. Sanderson, 824 So.2d 623, 625-26(¶ 8) (Miss.2002). A finding of fact is considered clearly erroneous when, even though there is evidence to support the finding, the reviewing court has...