Tyson Breeders, Inc. v. Harrison

• Decision Date: 19 October 2006
• Docket Number: No. 2005-IA-02317-SCT.,2005-IA-02317-SCT.
• Citation: Tyson Breeders, Inc. v. Harrison, 940 So.2d 230 (Miss. 2006)
• Parties: TYSON BREEDERS, INC., Stan Varner and Mack Walker v. James Eric HARRISON.
• Court: Mississippi Supreme Court

Page 230

940 So.2d 230

TYSON BREEDERS, INC., Stan Varner and Mack Walker v. James Eric HARRISON.

No. 2005-IA-02317-SCT.

Supreme Court of Mississippi.

October 19, 2006.

Lewis W. Bell, Jackson, G. David Garner, Raleigh, attorneys for appellants.

Audry Regnal Blackledge, Hattiesburg, David Shoemake, John Dudley Butler, Benton, attorneys for appellee.

EN BANC.

SMITH, Chief Justice, for the Court.

¶ 1. This case is before the Court on appeal from the Chancery Court of Covington County, by the defendant Tyson Breeders, Inc. ("Tyson"). Plaintiff James Eric Harrison seeks relief, including specific performance, injunctive relief, and actual and punitive damages, from Tyson, alleging that Tyson is responsible for damages he sustained when Tyson allegedly failed to abide by their Hatch Egg Production (HEP) Contract.¹

¶ 2. Tyson seeks review of the chancellor's order, which (1) granted partial summary judgment to Harrison on Harrison's breach of contract claim, and (2) transferred the remaining issue of damages to the Circuit Court of Covington County for a trial to determine damages. Tyson argues that the chancellor erred as a matter of law by failing to transfer Harrison's action, in its entirety, to the circuit court. As such, Tyson asserts the chancellor's order should be vacated and the entire matter transferred to the circuit court. In the alternative, Tyson claims that there are genuine issues of material fact as to Tyson's alleged liability, and therefore the order of partial summary judgment against Tyson should be vacated. Finding no jurisdiction in the chancery court, we hold that chancellor erred. Harrison's case is best heard in circuit court.

FACTS AND PROCEDURAL HISTORY

¶ 3. In 2000, Tyson and Harrison entered into an agreement whereby Harrison would grow and care for flocks of breeder hens in return for Tyson furnishing the flocks and providing feed, litter, poultry medication and technical instruction for the commercial production of eggs. Tyson informed Harrison in December of 2001, that he needed to enter into a subsequent HEP contract. On February 4, 2002, Tyson completed and executed the subsequent contract for a term of one year, beginning December 31, 2001 and ending on December 31, 2002. Meanwhile, Harrison continued to repair and upgrade his equipment and facilities as required by Tyson. He also continued to grow and care for the flocks of breeder hens for Tyson until late February or early March, when Tyson personnel removed all chickens from his property without any written notice of termination as required under the contract. In addition to his lack of notice, Harrison was not allowed to participate in performance improvement procedures, which were also required by the terms of the contract before termination. Throughout the remainder of the contract term, Tyson refused to provide other chickens to Harrison.

¶ 4. On December 17, 2002, Harrison filed a Complaint, alleging that Tyson breached the HEP contract by removing the chickens from his premises and by refusing to furnish him with another flock. Tyson unsuccessfully removed the case to federal court. Upon remand, Tyson moved to transfer the case to the Circuit Court of Covington County based on the following grounds: (1) the chancery court lacked subject matter jurisdiction; (2) the remedies sought were legal, not equitable, in nature; and (3) transfer was required to protect defendant's constitutional right to a jury trial. At the hearing on the Motion to Transfer on June 29, 2005, the chancellor took the issue of transfer under advisement, but ultimately found the chancery court had jurisdiction over the matter. Harrison subsequently filed a motion for partial summary judgment. On November 28, 2005, the chancery court entered an order which granted partial summary judgment in favor of Harrison for breach of contract and transferred the matter to the Circuit Court of Covington County for the purpose of determining damages. Tyson subsequently petitioned the court for interlocutory appeal, which was granted. See M.R.A.P. 5. On appeal, Tyson presents the following issues for review:

I. Whether the Chancery Court Erred as a Matter of Law in Failing to Transfer this Action for Damages, in its Entirety, to the Circuit Court.

II. Alternatively, Whether the Chancery Court's Entry of Partial Summary Judgment on Liability (Breach of Contract) Fails as a Matter of Law.

STANDARD OF REVIEW

¶ 5. Jurisdiction is a question of law that is reviewed by this Court de novo. Burnette v. Hartford Underwriters Ins. Co., 770 So.2d 948, 950 (Miss.2000). The standard of review for a ruling on a motion to transfer from chancery court to circuit court is also de novo. Union Nat'l Life Ins. Co. v. Crosby, 870 So.2d 1175, 1178 (Miss.2004). Further, de novo review of grants of summary judgment by a trial court applies equally to grants of partial summary judgment. Webb v. Braswell, 930 So.2d 387, 398 (Miss.2006).

ANALYSIS

¶ 6. Tyson, citing Crosby, alleges that despite inclusion of purported "equitable" claims, a complaint seeking actual and punitive damages and asserting claims for fraud, fraudulent inducement, breach of contract and negligence is clearly legal in nature and should be heard in circuit court to preserve the right of trial by jury. 870 So.2d at 1179-82. Tyson also claims that jurisdiction over a breach of contract action rests in circuit and not chancery court, and the remedy on interlocutory appeal is to order the transfer of the case from chancery to circuit court. Tyson further claims that since the HEP contract sought to be specifically enforced expired on December 31, 2002, there is no longer a contract upon which specific performance can be granted. Poole v. McCarty, 229 Miss. 170, 90 So.2d 190, 192-93 (1956).

¶ 7. Conversely, Harrison cites to Shaw v. Owen, 229 Miss. 126, 90 So.2d 179, 181 (1956), which states "where a suit is brought in the chancery court and the court takes jurisdiction on any one ground of equity, it will proceed in the one suit to a complete adjudication and settlement of every one of all the several disputed questions materially involved in the entire transaction ...." Shaw has been cited by the Court in numerous opinions, emphasizing that once a chancery court exercises equity jurisdiction, it may proceed to completely adjudicate the suit and award all appropriate remedies, both legal and equitable, even where the other questions involved in the suit are purely legal. Leaf River Forest Prods., Inc. v. Deakle, 661 So.2d 188, 193 (Miss.1995). See also Tillotson v. Anders, 551 So.2d 212, 213 (Miss. 1989) (where it appears from the face of a well-pleaded complaint there is an independent basis for equity jurisdiction, chancery courts may hear and adjudge law claims).

¶ 8. Article 6 of the Mississippi Constitution of 1890 designates the circuit court as a court of general jurisdiction, and the chancery court as one of limited jurisdiction. Section 159 limits the jurisdiction of chancery courts to the following areas: (a) all matters in equity; (b) divorce and alimony; (c) matters testamentary and of administration; (d) minor's business; (e) cases of idiocy, lunacy, and persons of unsound mind; and (f) all cases of which the said court had jurisdiction under the laws in force when the Constitution was put in operation. Miss. Const. art. 6, § 159. Section 162 states, "all causes that may be brought in the chancery court whereof the circuit court has exclusive jurisdiction shall be transferred to the circuit court." Miss. Const. art. 6, § 162.

¶ 9. This Court has held that breach of contract issues are best heard in circuit court. Southern Leisure Homes, Inc. v. Hardin, 742 So.2d 1088, 1089-90 (Miss.1999). In cases in which some doubt exists as to whether a complaint is legal or equitable in nature, the better practice is to try the case in circuit court. Id. Although the Court has previously allowed a chancery court to retain jurisdiction over cases involving questions of both law and equity, more recent cases hold that equitable claims are more appropriately brought before a circuit court when they are connected to a contractual relationship or other claims tied to questions of law. ERA Franchise Sys. v. Mathis, 931 So.2d 1278, 1282-83 (Miss.2006).

¶ 10. In Mathis, a former member of a real estate corporation alleged that member defendants wilfully diverted corporate assets to new entities in an attempt to convert the corporation's assets, intentionally excluded plaintiff from the business and induced real estate agents to terminate their agent contracts with the corporation by becoming agents of the new entities, resulting in the loss of his equity investment in the corporation. Id. at 1279-80. Plaintiff's complaint contained numerous breach of contract allegations and requested relief in the form of a constructive trust, estoppel, specific performance, and actual and punitive damages. Id. at 1280. Similarly to the present case, the defendants in Mathis filed a motion to transfer the case to circuit court, which the chancellor denied, and instead bifurcated the action. Id. The chancellor stated that after ruling on "all derivative claim issues as raised by the pleadings and any other strictly chancery matters," "all specific performance claims, if any," and "all claims for rescission asserted by Mathis", he would consider any remaining issues and transfer any issues he deemed to be legal to circuit court. Id. The Court held that...