Peoples Bank and Trust Co. v. L. & T. Developers, Inc.
| Decision Date | 17 August 1983 |
| Docket Number | No. 54171,54171 |
| Citation | 437 So.2d 7 |
| Parties | The PEOPLES BANK AND TRUST COMPANY and Bank of Mississippi v. L. & T. DEVELOPERS, INC., Joe L. Arick, D/B/A A. & H. Electrical and Refrigeration; and the Wickes Corporation. |
| Court | Mississippi Supreme Court |
Riley & Weir, James Patrick Caldwell, Mitchell, Eskridge, Voge, Clayton & Beasley, Stephen M. Corban, Tupelo, for appellants.
Robert L. Lancaster, Columbus, Carnathan & Malski, John M. Creekmore, Tupelo, Tubb, Stevens & Morrison, J. Joshua Stevens, Jr., West Point, for appellees.
Before PATTERSON, C.J., and ROY NOBLE LEE and ROBERTSON, JJ.
ON MOTION FOR ASSESSMENT OF STATUTORY DAMAGES
I.
On April 12, 1982, the Chancery Court of Clay County, Mississippi, rendered a final decree the net effect of which was the recognition of perfected liens or security interests in and to one or more of three tracts of land in Clay County, the priorities and amounts of which are as follows:
TRACT NO. I
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(1) (a) Joe L. Arick, d/b/a A & H
Electrical and Refrigeration $ 3,200.00
(b) The Wickes Corporation $ 5,030.89
(2) L & T Developers, Inc. $ 8,000.00
(3) Bank of Mississippi $32,000.00
TRACT NO. II
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(1) The Wickes Corporation $ 2,387.77
(2) L & T Developers, Inc. $ 8,000.00
(3) Peoples Bank & Trust Company $31,845.00
TRACT NO. III
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(1) L & T Developers $ 8,000.00
(2) Peoples Bank and Trust Company $31,605.00
The Chancery Court's final decree further provided, inter alia, as follows:
That Peoples Bank & Trust Company and Bank of Mississippi are granted the option to within thirty (30) days of the date of this decree, to pay said prior liens and all costs herein. That if said option is not exercised, said tracts shall be sold by judicial sales in accordance with the statutes in that regard made, and the proceeds of said sales shall be applied first to the payment of all court costs and then in accordance with the hereinabove ordered priority of liens.
The Chancery Court's decree may fairly be regarded as "a judgment or decree for the sale of property, or some interest in it, to satisfy a sum out of the proceeds of sale, or to enforce or establish a lien or charge or claim upon or some interest in property" within the meaning of Miss.Code Ann. Sec. 11-3-23 (Supp.1982).
On June 1, 1983, the Court released its opinion affirming the decree of the Chancery Court. Peoples Bank and Trust Company, et al., v. L & T. Developers, Inc., et al., 434 So.2d 699 (Miss.1983).
II.
L & T Developers, Inc., one of the Appellees herein and also a Cross-Appellant, has now filed a Motion to Correct Judgment by Assessment of Statutory Damages. 1 In effect, L & T's motion seeks the addition of 15 percent to the amount of its liens recognized in the final decree of the Chancery Court of Clay County, L & T relies upon rights claimed under the Mississippi mandatory damages statute, Miss.Code Ann. Sec. 11-3-23 (Supp.1982). 2
The decree of the Chancery Court, affirmed here, recognizes a perfected security interest or lien in L & T Developers, Inc. (a) in the amount of $8,000 against Tract No. I, (b) in the amount of $8,000 against Tract No. III. The decree further provides that the property may be sold to pay the lien.
Bank of Mississippi was the Appellant with respect to Tract No. I only. On appeal it challenged L & T's $8,000 lien against the property. The bank argued:
See Brief of Appellant, Bank of Mississippi, filed October 6, 1983, page 30.
Peoples Bank argued with respect to Tract No. II that its $31,845 lien had priority over L & T's $8,000 lien and that with respect to Tract No. III its $31,605 lien had priority over L & T's $8,000 lien.
III.
One of Section 11-3-23's requisites for award of the 15 percent damages is that "the only matter complained of on the appeal is the decree as to some particular property or claim on it". We find this requisite to have been met.
As indicated above, one of the Appellants, Bank of Mississippi, contested the validity of L & T's lien. The other Appellant, Peoples Bank, challenged only priority. Regardless of differences in legal theory between the two Appellants, both appeals presented a dispute regarding these tracts of land. If the two Appellants had been successful on their appeal, the net practical effect would have been that L & T would have completely lost its interest in these three tracts of land.
Under the theory advanced by Bank of Mississippi, L & T's lien would have been "cleaned off" by a foreclosure sale. Under Peoples Bank's theory, it was entitled to priority over L & T. Under Peoples Bank's theory, it was entitled to priority over L & T. Had either theory prevailed, it is clear that L & T Developers would have walked away from this litigation empty handed. Under these facts and circumstances, we hold that, within the meaning of Section 11-3-23, the only matter of substance complained of on this appeal was the decree of the Chancery Court as to the three tracts of land and the claims to them.
The next point we consider in opposition to the Motion for Assessment of Statutory Damages is that L & T Developers, Inc. was not wholly successful on this appeal. First, it is noted that L & T was a cross-appellant and that its cross-appeal was denied. Second, it is urged that, at least with respect to Tract Nos. I and II, the Chancellor's decree and this Court's affirmance granted a first priority to the materialmen and construction lienors, Arick and Wickes, with L & T Developers, Inc. receiving only a second priority.
The first point is answered authoritatively in Housing Authority of City of Gulfport v. Barbee, 283 So.2d 591 (Miss.1973). In the Barbee case, the appellee, J.G. Barbee, III, had taken a cross-appeal. This Court affirmed on direct and cross-appeal. Housing Authority of City of Gulfport v. Barbee, 279 So.2d 604 (Miss.1973). In other words, Barbee was unsuccessful on his cross-appeal. This Court held, nevertheless, that Barbee was entitled to an assessment of statutory damages under the precursor of Section 11-3-23. In assessing the statutory damages, the Court stated:
Even though the Housing Authority and Barbee both were dissatisfied with the $20,000 judgment, the Housing Authority first took advantage of the appellate process and initiated an appeal. Barbee later cross-appealed. The judgment of the court below was affirmed without change, 279 So.2d 604; this case fits squarely within the terms of the statute. The statute provides: "... the Supreme Court shall render judgment against the appellant for damages ..." We must comply with the mandate of the law.
The litigant who first initiates an appeal was construed by us in Pearce v. Ford Motor Company, 235 So.2d 281 (Miss.1970) to be the appellant referred to in Section 1971 against whom damages are to be assessed upon affirmance without change of the lower court's judgment. 283 So.2d at 592.
Bank of Mississippi with respect to Tract No. I and Peoples Bank and Trust Company with respect to Tract Nos. II and III are the litigants who first initiated this appeal. They are subject to assessment of statutory damages under Section 11-3-23. The fact that L & T took a cross-appeal which was unsuccessful is irrelevant.
The next question presented is whether the fact that L & T was awarded by the Chancellor a second priority, which was affirmed here, instead of a first priority, precludes application of the statutory damages statute. We hold that it does not.
In the first place, the statute provides that the 15 percent damages shall be assessed "in case the judgment or decree of the court below be affirmed". That occurred here. What--and all--L & T won in the Chancery Court has been affirmed here. What--and all--L & T won in the Chancery Court was under great attack by the two Appellants, Bank of Mississippi and Peoples Bank & Trust Company, on this appeal. That appeal was denied in its entirety.
We are not unaware that our prior cases have heretofore cautioned that Section 11-3-23 is highly penal and ought be construed against the claim of the moving appellee. McKendrick v. Lyle Cashion Company, 234 Miss. 325, 340, 106 So.2d 509, 511 (1958); Lowicki v. Lowicki, 429 So.2d 917, 919 (Miss.1983). Though this admonition be well in mind, no linguistic expertise is necessary to see that this case fits well within the plain meaning of Section 11-3-23.
Bank of Mississippi points out that statutory damages may not be awarded unless the affirmance is unconditional. The Bank argues that the alternatives given the banks of payment of L & T's lien or sale of the property to satisfy L & T's claim run afoul of this rule.
Our cases are clear that affirmance must indeed be unconditional before statutory damages may be assessed. Shipman v. Lovelace, 215 Miss. 141, 144-146, 60 So.2d 559, 560-561 (1952); Comment, Mandatory Assessment of Damages Against An Unsuccessful Appellant: A Constitutional Analysis, 53 Miss.L.J. 281, 286 (1983). The conditions noted here were in the Chancery Court's final decree rendered April 12, 1982. That...
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