CourtUnited States State Supreme Court of Mississippi
Citation825 So.2d 8
Docket NumberNo. 1999-IA-01699-SCT.,1999-IA-01699-SCT.
PartiesJohn W. STUBBS and A.W. Stubbs v. MISSISSIPPI FARM BUREAU CASUALTY INSURANCE COMPANY a/k/a Farm Bureau Casualty Insurance Company, Trustmark National Bank, Billy Welch and Welch Auto Plex, Inc.
Decision Date20 June 2002

825 So.2d 8

John W. STUBBS and A.W. Stubbs
MISSISSIPPI FARM BUREAU CASUALTY INSURANCE COMPANY a/k/a Farm Bureau Casualty Insurance Company, Trustmark National Bank, Billy Welch and Welch Auto Plex, Inc

No. 1999-IA-01699-SCT.

Supreme Court of Mississippi.

June 20, 2002.

Rehearing Denied September 12, 2002.

825 So.2d 9
Edwin Y. Hannan, Michael S. Allred, Jackson, Eugene Coursey Tullos, John Raymond Tullos, Raleigh, attorneys for appellants

Rebecca Suzanne Blunden, Charles G. Copeland, Ridgeland, William F. Ray, Emerson Barney Robinson, III, Robert A. Miller, Jackson, George D. Runnels, Magee, attorneys for appellees.


SMITH, P.J., for the court.

¶ 1. This case presents an interlocutory appeal from the Circuit Court of Simpson County, Mississippi, after venue was transferred to it from the Circuit Court of Smith County. We find that the Smith County Circuit Court abused its discretion in granting the motion for change of venue.

825 So.2d 10

¶ 2. John W. Stubbs visited Welch Auto Plex, Inc., in Mendenhall, Simpson County, Mississippi, to discuss with Billy C. Welch the purchase of a 1995 Chevrolet Corvette. John asked Welch to obtain financing for the vehicle through Trustmark National Bank. Welch telephoned the Trustmark branch in Mendenhall, and Trustmark said that it would approve a loan to John if A.W. Stubbs, John's father, would co-sign the note. Trustmark would finance the purchase of the vehicle through a process known as "indirect financing."1

¶ 3. A.W. contacted the Mississippi Farm Bureau Casualty Insurance Company (Farm Bureau) in Raleigh, Smith County, Mississippi, to discuss possible insurance coverage of the vehicle. He gave the insurance agent a complete description of the vehicle, including its location. He informed Farm Bureau that he and John intended to purchase the vehicle and to insure the vehicle with Farm Bureau. A.W. had been an insurance customer of Farm Bureau for many years and, on the date of the purchase of the Corvette, had three other vehicles insured with Farm Bureau. A.W. had liability, but not collision or comprehensive, coverage on the other three vehicles. A.W.'s Farm Bureau insurance policy provided for automatic insurance for newly acquired automobiles as follows:


1. Additional Automobile—If the named Insured or spouse acquires ownership of an additional private passenger automobile, pickup or van, insurance automatically applies to such additional vehicle for a period of the lesser of (a) 30 days beginning on the day the named Insured or spouse takes possession, or (b) the expiration of the policy....
* * *
3. The Following Provisions Apply to Both Additional Automobiles and Replacement Automobiles:
Any automatic insurance provided by Section IX is limited to the types of coverages, limits of coverages and terms of coverages applicable to the vehicle described in the Declarations....

¶ 4. On a Saturday, John and A.W. drove to Mendenhall from their home in Simpson County, Mississippi, and finalized the purchase of the Corvette. Welch attempted to telephone the local agent for Farm Bureau in Raleigh, to no avail. Welch then faxed the purchase documents to Trustmark and/or Farm Bureau. Because Welch was unable to contact Farm Bureau, John asked Welch if they (the Stubbses) would be covered. According to the Stubbses, Welch replied, "You do not need to worry. You are covered by insurance." The Stubbses claim that Welch told them that they had full coverage with him until they contacted Farm Bureau. The Stubbses never purchased automobile insurance from Farm Bureau specifically for the Corvette. In his deposition, A.W. stated that he knew that his policies did not

825 So.2d 11
provide for collision or comprehensive coverage at the time the Corvette was purchased. As John was driving the Corvette back to Taylorsville, and after he had crossed the county line into Smith County, the Corvette was involved in a one-vehicle collision. John sustained injuries, and the Corvette was "totaled." He was hospitalized and incurred medical expenses in Simpson County

¶ 5. John and A.W. are residents of Simpson County. The Farm Bureau's principal place of business is in Hinds County, but A.W. did business with the Farm Bureau's branch office in Smith County. Trustmark's principal place of business is in Hinds County, but its branch in Simpson County was the office involved in the financing of the Corvette. Welch resides in Simpson County. The Auto Plex's principal place of business is in Simpson County. The accident occurred in Smith County.

¶ 6. John and A.W. filed a complaint in the Circuit Court of Smith County against Welch, the Auto Plex, Trustmark and Farm Bureau, claiming that the defendants were liable for negligence, gross negligence, breach of contract, bad faith breach of contract, breach of covenants of good faith and fair dealing, bad faith, lender liability, breach of fiduciary duties, estoppel, extrinsic fraud and fraud by concealment.

¶ 7. With respect to the Farm Bureau, the Stubbses alleged it had actual knowledge that the purchase of the vehicle was being financed through Trustmark and that Trustmark required insurance on newly-purchased vehicles. Farm Bureau insured all of A.W.'s other vehicles. Under the policies previously issued to A.W., newly-acquired vehicles were automatically insured. The Stubbses averred that Farm Bureau's denial of collision and comprehensive coverage and medical payments coverage constituted bad faith, that it was estopped from denying coverage and that it negligently failed to insure the vehicle.

¶ 8. With respect to Trustmark, the Stubbses alleged it was estopped from denying insurance coverage because, under the terms of the retail installment contract, Trustmark had the right to insure the vehicle against collision and comprehensive loss upon notice that the vehicle was uninsured. Thus, the Stubbses charged that Trustmark negligently failed to obtain insurance on the vehicle and engaged in fraud and bad faith.

¶ 9. With respect to Welch, the Stubbses alleged that he promised them that the vehicle was insured at the time the vehicle was delivered to them and that they reasonably believed Welch's assurances. Therefore, they charged that Welch and "his" insurance carrier (Farm Bureau) were estopped from denying coverage. Furthermore, they asserted that Welch negligently failed to insure the vehicle and he and "his" insurance carrier engaged in conduct which was fraudulent and which constituted bad faith.

¶ 10. Each of the defendants challenged venue in their answers to the complaint.2 Trustmark filed a separate motion to transfer venue, and Welch and the Auto Plex later joined in this motion.

¶ 11. At the hearing on the motion for change of venue, Trustmark argued: (1) its acceptance of the assignment of the

825 So.2d 12
loan paper from the car dealer occurred in Simpson County; (2) the allegations in the complaint did not pertain to any occurrence in Smith County because, even though A.W. did business with the Farm Bureau office in Smith County, the only Farm Bureau coverage on the Corvette under A.W.'s existing policies was liability; and because the accident was a one-vehicle accident, liability coverage was not applicable; therefore there was no coverage for the accident under A.W.'s Farm Bureau policies and no viable claim against the Farm Bureau; (3) the conversations that Welch had with various people, of which the Stubbses complain, occurred in Simpson County; (4) none of the complained-of actions by Trustmark, Welch, or the Auto Plex occurred in Smith County; (5) the insurance company venue statute did not apply because there was no insurance in effect which would cover a one-vehicle collision; and (6) Blackledge v. Scott, 530 So.2d 1363 (Miss.1988), held that the insurance company venue statute did not apply where there was no valid claim against an insurance company

¶ 12. The Stubbses replied that they contacted Farm Bureau before and after they made the decision to purchase the vehicle, Trustmark required them to sign a document guaranteeing that they had insurance; Welch was an agent of Trustmark, so Trustmark is liable for what Welch did; Welch performed all of the complained-of actions in Simpson County; the vehicle was wrecked in Smith County; Flight Line, Inc. v. Tanksley, 608 So.2d 1149 (Miss.1992), holds that venue lies either where any substantial thing giving rise to the cause of action occurs or accrues; Forman v. Mississippi Publishers Corp., 195 Miss. 90, 14 So.2d 344 (1943), holds that "accrue" means the place where the last event necessarily brings the cause of action into being and gives the plaintiff standing occurs; the insurance venue...

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