Tupelo Redevelopment Agency v. The Gray Corporation, Inc. ( 2006 )

`` IN THE SUPREME COURT OF MISSISSIPPI
NO. 2006-CA-00218-SCT
THE TUPELO REDEVELOPMENT AGENCY
v.
THE GRAY CORPORATION, INC.
AND
THE GRAY CORPORATION, INC.
v.
RONALD J. RAGLAND, SR. d/b/a RAGLAND
ENGINEERING AND RAGLAND CONSTRUCTION
AND
RONALD J. RAGLAND, SR. d/b/a RAGLAND
ENGINEERING AND RAGLAND CONSTRUCTION
v.
THE TUPELO REDEVELOPMENT AGENCY
DATE OF JUDGMENT: 01/12/2006
TRIAL JUDGE: HON. THOMAS J. GARDNER, III
COURT FROM WHICH APPEALED: LEE COUNTY CIRCUIT COURT
ATTORNEYS FOR APPELLANT: KEVIN B. SMITH
GUY W. MITCHELL
WILLIAM DANIEL PRESTAGE
WILLIAM G. ARMISTEAD, SR.
ATTORNEYS FOR APPELLEES: B. SEAN AKINS
THOMAS W. PREWITT
KENNETH MARTIN HEARD, III
NATURE OF THE CASE: CIVIL - CONTRACT
DISPOSITION: ON DIRECT APPEAL: AFFIRMED; ON
CROSS-APPEALS: AFFIRMED - 10/18/2007
MOTION FOR REHEARING FILED:
MANDATE ISSUED:
BEFORE DIAZ, P.J., CARLSON AND RANDOLPH, JJ.
CARLSON, JUSTICE, FOR THE COURT:
¶1. After a jury trial, the Circuit Court of Lee County entered a judgment in favor of the
Gray Corporation, Inc., and against the Tupelo Redevelopment Agency for $258,118; and
likewise entered a judgment in favor of Ronald J. Ragland, Sr., d/b/a Ragland Engineering
and Ragland Construction and against the Gray Corporation for $1,216,605.20. The Tupelo
Redevelopment Agency appeals from the judgment entered against it, and the Gray
Corporation, Inc., and Ronald J. Ragland, Sr., d/b/a Ragland Engineering and Ragland
Construction, cross-appeal. After consideration of the record before us and the applicable
law, we affirm on all issues raised both in the direct appeal and the cross-appeals.
FACTS AND PROCEEDINGS IN THE TRIAL COURT
¶2. On October 20, 2000, the Tupelo Redevelopment Agency (TRA) entered into a
contract with the Gray Corporation, Inc. (Gray) for the construction of the Tupelo
Fairgrounds Redevelopment Project (the Project). Gray was bonded by the Hartford Fire and
Insurance Company (Hartford). The original price contemplated by the contract was
$1,725,347.08 and consisted of three components: Component A, water and sewer
improvements; Component B, site work; and Component C, electrical, CATV, telephone and
duct system. Allen & Hoshall provided the electrical plan and specifications to TRA for
2
Component C of the Project. Jesco, Inc. (Jesco)1 was hired to serve as Construction
Manager, and Tupelo Water & Light (TWL) was hired to inspect and approve the
Component C work. For the Component C work, Gray 2 entered into a oral subcontract with
Ronald Ragland, Sr., d/b/a Ragland Engineering and Ragland Construction (Ragland),3
whereby Ragland agreed to perform some of the layout work contemplated by Gray’s
contract with TRA, and to construct portions of the Project.
¶3. After beginning work on Component C, Ragland noticed there were problems with
the plans given to it by Gray. After Allen & Hoshall spent nearly three months trying to
correct the electrical plans and specifications with no solution, TRA, Jesco and Allen &
Hoshall enlisted Ragland’s help to properly identify quantities of work and the scope of the
Project requirements. Because these revisions required extra work on the part of Gray and
Ragland, TRA, through its representative Jesco, promised Gray and Ragland a future change
order. On February 15, 2001, Ragland presented Brister with a narrative explaining the need
for a change order to the Project. On March 2, 2001, Gray obtained change order number
1
Jesco’s employee Steve Brister was the primary construction manager. As Jesco’s
primary construction manager, Steve Brister’s scope of employment was to “manage the
project, to be the owner’s liaison, eyes and ears on the project on a day-to-day basis.”
2
In accordance with Miss. Code. Ann. § 31-5-51 (Rev. 2005), Gray, as principal, and
Hartford, as surety, executed a payment bond under which Gray and Hartford jointly and
severally agreed to promptly pay all persons supplying labor and materials in the prosecution
of the work required by the Project.
3
Mr. Ragland is a professional engineer, a registered land surveyor and a licensed
contractor.
3
1, as required by the contract terms with TRA, for modifications to the electrical plan and
specifications to Component C. Additionally, Gray requested and received two more change
orders, number 2 and number 3. The three change orders brought about net additions of
$283,209.20 to the original contract terms. Gray and Ragland proceeded with the
contemplated work on the Project without receiving any additional change orders for any
extra work or time delays associated with Component C.4
¶4. After Ragland completed the work and requested payment from Gray, which was
never received, Ragland made a ore tenus motion to intervene in a suit which already had
been filed in the Circuit Court of Lee County, styled “W.G. Construction, Inc. v. The Gray
Corporation, Inc. and The Hartford Fire and Insurance Company,” civil cause number CV02-
133(G)L on the docket of that court.5 The motion to intervene was granted on August 12,
2002.
¶5. Thereafter, Ragland filed an intervention complaint against Gray and Hartford. In the
complaint, Ragland alleged:
Ragland’s work at the project was made difficult, more costly, and time
consuming by Gray and/or third parties for which Gray is responsible. In
4
However, Gray and Ragland contend that since the changes were ongoing and delays
were mounting, TRA promised to issue a “final change order” to address all outstanding
issues. Such final change order was never issued by TRA due to the disputes which arose
at the end of the Project and Gray’s request for equitable adjustment.
5
On October 29, 2003, the circuit court entered an Agreed Order Dismissing with
Prejudice the Claims of W.G. Construction, Inc. and the Derivative Third-Party Claims
Asserted by the Gray Corporation, Inc. Against the Tupelo Redevelopment Agency Which
are Premised on the Claims of W.G. Construction, Inc.
4
addition to the work that it initially contracted to perform, Ragland was
required by Gray to perform and did perform additional and different work
than the work originally contemplated by the parties. Further, Ragland was
unable to perform its work in the manner originally contemplated and as
scheduled. It was denied access to portions of the work; Ragland’s
construction efforts were interfered with; and, Ragland encountered different
conditions at the project than had been reasonably anticipated. Likewise, Gray
improperly performed administrative tasks and aspects of the project were
changed. As a consequence of all of the above, Ragland became entitled to
additional compensation and although Ragland was entitled to additional
contract time, Gray continued to insist that Ragland perform at an
unreasonable rate.
Ragland periodically billed Gray for its work; however, although Gray made
some payments, Gray refused and still refuses to pay Ragland $534,454.11
being the total amount due it and which has been due for many months.
Based on Ragland’s allegations, Ragland’s prayer for relief is as follows:
WHEREFORE, PREMISES CONSIDERED, Ronald J. Ragland, Sr. demands
judgment against The Gray Corporation, Inc. and The Hartford Fire and
Insurance Company in the amount of at least Five Hundred Thirty-Four
Thousand, Four Hundred Fifty Four Dollars and 11/cents ($534,454.11), plus
pre-judgment interest, the penalty and interest required by § 31-5-27 Miss.
Code Ann. (Supp. 2001), interest, costs and attorneys fees anticipated under
§ 31-5-57 Miss. Code Ann. (Supp. 2001).
Both Gray and Hartford filed Answers and Affirmative Defenses on September 23, 2002,
denying any liability. Particularly, Gray and Hartford contended that Ragland:
engaged in a direct relationship with the owner [TRA] and architect for the
Project, made agreements directly with the Owner and Architect and not as a
subcontractor to Gray. As a result, Gray [and Hartford] ha[ve] no liability to
Ragland for any claims Ragland asserts for delays, interference or extra work
resulting from work performed on the Project.
5
Gray and Hartford also assert that Gray was not indebted to Ragland for any work Ragland
performed as subcontractor; or that Gray had not been paid by TRA and thus was not
obligated to pay Ragland.
¶6. On November 6, 2002, Gray filed a Motion for Leave to File Third-Party Complaint
and to File Additional Claims Against the Third Party Defendant, TRA, and on November
22, 2002, the Lee County Circuit Court granted Gray’s motion for leave to file a third-party
complaint. Gray filed its third-party complaint on December 5, 2002.
¶7. In its third-party complaint, Gray asserted, inter alia:
On or about March 1, 2002[6 ], counsel for Gray made a formal claim for
equitable adjustment for additional work, delays and loss in efficiency
resulting from the delays and additional work. . . . Gray is entitled to an
equitable adjustment in the amount of not less than $771,912.91 for delays.
Further, Gray is entitled to recover for extra work in an amount to be
determined at trial.
In addition to the amounts due Gray for equitable adjustment to the Contract,
the TRA has yet to pay the contract balance for the original contract work [in
the amount of $207,551.76]. As a result, Gray has likewise not made final
payments to its subcontractor[] Ragland. . . .Gray is not liable pursuant to the
terms of its subcontracts and Mississippi law to make final payment to said
subcontractors until final payment is received by Gray from the owner, TRA.
¶8. While Gray admittedly asserts that it is not liable to Ragland, Gray contends that “if
Gray is liable to Ragland for work performed or delays encountered on the Project pursuant
6
On December 16, 2002,TRA and Gray entered into a Partial Release and Settlement
Agreement, settling all claims except to the extent set forth in the letter dated March 1, 2002.
Essentially, the claims reserved by Gray and Ragland were for an “equitable adjustment” for
additional work performed beyond the scope of the original contract in the amount of
$771,912.91.
6
to the subcontract between Ragland and Gray, then . . . TRA is liable to Gray under the
general contract” and “pursuant to the doctrine of common law indemnity.” On October 23,
2003, TRA filed its Answer and Defenses to Third Party Complaint.
¶9. On May 21, 2004, Gray filed a Motion for Leave to File Amended Third-Party
Complaint and To File Additional Claims Against the Third-Party Defendant, Allen &
Hoshall Ltd. Architects Engineers (“Allen & Hoshall”).7 On August 3, 2004, the trial judge
heard Gray’s Motion to File Amended Third-Party Complaint. Concluding that the motion
was not well-taken, the trial judge entered an order denying Gray’s motion on August 10,
2004.
¶10. On December 13, 2004, Ragland filed a Motion to Amend Intervention Complaint,
alleging that discovery had been conducted, and, based on that discovery, Ragland desired
to seek punitive damages against Gray and Hartford. Both Gray and Hartford opposed
Ragland’s Motion to Amend Intervention Complaint on January 25, 2005, and January 26,
2005, respectively. After a hearing on Ragland’s Motion to Amend Intervention Complaint,
the trial court entered an order denying the motion on February 23, 2005.
¶11. Ragland filed yet another Motion to Amend Intervention Complaint on June 27, 2005.
However, this motion was based on Ragland’s assertion that the amount of damages sought
should be increased from $534,454.11 to $1,339,658.63. In addition, Ragland sought to add
the allegation that March 1, 2002, should be the date from which prejudgment interest should
7
Allen & Hoshall performed electrical design and construction engineering services
for the Project.
7
begin to run. On July 7, 2005, Gray and Hartford filed a joint Response to Ragland’s Motion
to Amend Intervention Complaint opposing Ragland’s motion on grounds of equitable
estoppel and undue delay. In addition, Gray asserted that if Ragland was allowed to amend
its Intervention Complaint, Gray should be allowed to amend its Third-Party Complaint
against TRA to reflect the relief now being sought by Ragland. Also on July 7, 2005, TRA
filed a Motion to Enforce Partial Release and Settlement Agreement detailing an agreement
between TRA and Gray, in which Gray released TRA from any further liability except the
exact claim for equitable adjustment amounting to $771,912.91, which fixed the claimed
amount for equitable adjustment relating to Ragland at $458,178.00. TRA thus claimed that
if Gray was found liable to Ragland for an amount exceeding $458,178.00, TRA was not
liable for the increased amount. Furthermore, on July 7, 2005, TRA moved for summary
judgment on the ground that Gray had failed to come forward with elemental proof to sustain
claims for equitable adjustment to the contract. However, Gray and Hartford moved to Strike
TRA’s Motion for Summary Judgment and Motion to Enforce Partial Release and Settlement
Agreement as untimely since these motions were filed just eighteen days prior to trial. In
addition, Gray and Hartford filed a motion for an emergency hearing on its motions to strike.
On July 14, 2005, Ragland contested TRA’s Motion to Enforce Partial Release and
Settlement Agreement.
¶12. On July 15, 2005, Gray filed a Response to TRA’s Motion for Summary Judgment
and in the Alternative for Summary Judgment as to Ragland’s Claims. Furthermore, Gray
8
and Hartford filed a Response to TRA’s Motion to Enforce Partial Release and Settlement
Agreement. Ragland also filed a Response to TRA’s Motion for Summary Judgment.
¶13. During a telephone conference on July 22, 2005, the trial judge granted Ragland’s
Motion to Amend Intervention Complaint. On July 26, 2005, Ragland filed its Amended
Intervention Complaint against Gray and Hartford.
¶14. Trial began on July 26, 2005, concluding on August 5, 2005. After hearing all of the
evidence, the jury returned verdicts based on special interrogatories submitted by the trial
judge. Specifically, the jury rendered a verdict in favor of Ragland and against Gray in the
amount of $850,551.32, of which amount Gray and Hartford were found jointly and severally
liable for $619,173.32. The jury also rendered a verdict for Gray against TRA in the amount
of $258,118.00.
¶15. On August 12, 2005, Ragland filed a Motion for Assessment of Attorney’s Fees,
Prejudgment Interest and Penalty, which the circuit court heard on September 28, 2005,
issuing its order on October 11, 2005. On November 2, 2005, the circuit court entered its
Final Judgment, in which the circuit court specifically retained jurisdiction to modify and
amend the Judgment.
¶16. On November 2, 2005, TRA filed a Motion for Judgment Notwithstanding the Verdict
or, in the Alternative, For a New Trial, or, in the Alternative, To Alter or Amend the
Judgment, or in the Alternative, For a Remittitur. Additionally, on November 10, 2005, Gray
and Hartford filed a Motion for Judgment Notwithstanding the Verdict or, in the Alternative,
9
For a New Trial, or, in the Alternative, to Alter or Amend the Judgment, or in the
Alternative, For a Remittitur.
¶17. On December 13, 2005, the circuit court entered an order reflecting that TRA had paid
its judgment in favor of Gray in the amount of $258,118 plus all incurred interest. This
payment thus satisfied and cancelled the judgment entered against TRA and in favor of Gray.
In addition, satisfaction of the judgment by TRA removed the lien upon all of TRA’s
property, real, personal or mixed.
¶18. On December 29, 2005, Ragland and Hartford entered into a Full, Final, Absolute
Release and Assignment whereby Hartford paid Ragland $475,000 and assigned all of its
rights in and to the funds deposited with the Court by TRA. That same day, Ragland filed
a Motion to Require the Circuit Clerk To Pay Ragland the Funds TRA Paid into Court.
However, on January 6, 2006, TRA filed a Motion to Stay Execution of Money Judgment
Proceeds Paid Into The Court By The Tupelo Redevelopment Agency Pending Appeal and
To Allow Tupelo Redevelopment Agency’s Payment of Judgment Into the Court’s Registry
To Serve As Sufficient Security For Appeal Or Allow Tupelo Redevelopment Agency To
Secure A Supersedeas Bond In An Amount No Greater Than 25% of the Judgment Against
It.
¶19. The court dismissed Hartford with prejudice on January 12, 2006, as it had fully paid
its judgment. Additionally, the circuit court entered an Amended Final Judgment which
reflected the circuit court’s decision concerning the amount of attorneys’ fees to be assessed
against Gray and Hartford; the assessment of the penalty contemplated by Miss. Code Ann.
10
§ 31-5-27; and the rate of post-judgment interest, as well as fixing the date from which post
judgment interest would begin to run. As a result, Ragland’s judgment against Gray was
increased to $1,216,605.20, of which $892,676.00 was the joint and several obligation of
Gray and Hartford. Furthermore, the circuit court’s order:
(1) Denied TRA’s Motion For Judgment Notwithstanding the Verdict or, in the
Alternative, For a New Trial, or, in the Alternative, to Alter or Amend the
Judgment, or in the Alternative, For a Remittitur;
(2) Denied the Motion For Judgment Notwithstanding the Verdict or, in the
Alternative, For a New Trial, or, in the Alternative, to Alter or Amend the
Judgment, or in the Alternative, For a Remittitur filed by Gray and Hartford;
(3) Determined that the Judgment entered on November 2, 2005, should bear
interest at eight percent per Annum from and after November 2, 2005, until
paid;
(4) Granted Ragland’s Motion for Assessment of Attorney’s Fees,
Prejudgment Interest and Penalty and assessed a Penalty on the unpaid contract
balance of $123,016.12 in the amount of $18,452.40; and
(5) Granted Ragland’s Motion for Assessment of Attorney’s Fees,
Prejudgment Interest and Penalty and assessed attorney’s fees against Gray
and Hartford at forty percent of the principal amount of the November 2, 2005,
judgment.
¶20. Thereafter, on January 17, 2006, the circuit court entered an Order denying Ragland’s
Motion to Require the Circuit Clerk to Pay Ragland the Funds TRA Paid into Court and
granted TRA’s Motion to Stay Execution, allowing TRA to satisfy the requirement of posting
a bond equal to 125% of the judgment amount by the posting of an appeal bond equal to 25%
of said amount.
11
¶21. Thus, TRA perfected its appeal to this Court on February 1, 2006, asserting four
issues:
(1) Whether TRA waived enforcement of its contractual rights;
(2) Whether statutory and common law safeguards pertaining to public
construction contracts limit the liability of TRA;
(3) Whether Gray was entitled to maintain a claim for extra-contractual
damages;
(4) Whether Gray was entitled to indemnification from TRA.
¶22. On February 7, 2006, Gray perfected its cross-appeal to this Court raising one issue
as to TRA:
(1) Whether Gray was entitled to an additur.
In its cross-appeal, Gray raised five issues as to Ragland:
(1) Whether Ragland was entitled to recover on a quantum meruit basis;
(2) Whether Ragland proved [its] quantum meruit damages with reasonable
certainty;
(3) Whether a new trial or remittitur should be granted;
(4) Whether an award for attorney’s fees was appropriate when a judgment
was based on a quantum meruit claim;
(5) Whether the award of attorney’s fees was excessive.
¶23. Lastly, on February 13, 2006, Ragland filed its notice of cross-appeal, asserting four
issues:
(1) Whether the circuit court erred in denying Ragland’s motion to direct
the circuit clerk to pay Ragland the money TRA paid into Court;
12
(2) Whether the circuit court created a disproportionate and irreparable
harm to Ragland by removing the judgment lien and then permitting a
supersedeas appeal concerning that judgment;
(3) Whether the circuit court erred by not protecting Ragland as a
prevailing party;
(4) Whether the circuit court erred in granting TRA’s motion to post a
supersedeas bond, and/or by posting a bond equal to 25% of the
judgment.
DISCUSSION
¶24. For clarity in our discussion, we have combined and re-worded the issues below.
I. TRA’S MOTION FOR DIRECTED VERDICT.
¶25. TRA appeals to this Court asserting that its motion for directed verdict should have
been granted for four reasons: (1) Gray has not carried its legal burden of showing that TRA
waived its contractual rights to require change orders for alleged extra work; (2) TRA has
statutory and common-law safeguards which limit its liability; (3) the circuit court erred in
allowing the jury to determine whether Gray was entitled to delay damages; and (4) TRA
should not be obligated to indemnify Gray.
¶26. The standard of review for a directed verdict is well-settled in Mississippi.
This Court will consider the evidence in the light most favorable to the
appellee [non-movant], giving that party the benefit of all favorable inference
[sic] that may be reasonably drawn from the evidence. If the facts so
considered point so overwhelmingly in favor of the appellant [movant] that
reasonable [jurors] could not have arrived at a contrary verdict, we are required
to reverse and render. On the other hand if there is substantial evidence of
such quality and weight that reasonable and fair minded jurors in the exercise
of impartial judgment might have reached different conclusions, affirmance is
required.
13
White v. Stewman, 932 So. 2d 27, 32 (Miss. 2006) (citing Steele v. Inn of Vicksburg, Inc.,
697 So. 2d 373, 376 (Miss. 1997)).
A. Waiver of Contractual Rights.
¶27. First, TRA contends that Gray has not carried its legal burden of showing that TRA
waived its contractual rights to require change orders for alleged extra work. Particularly,
TRA contends that when TRA and Gray entered into a written contract for the construction
of the Project on October 20, 2000, the contract had specific provisions regarding changes
in the work. Two such provisions are paragraphs 10.1 and 10.3. Paragraph 10.1, in the
general conditions of the contract, states:
Without invalidating the Agreement, the Owner may, at any time or from time
to time, order additions, deletions or revisions in the Work; these will be
authorized by Change Orders. All such Work shall be executed under the
applicable conditions of the Contract Documents. If any Change Order causes
an increase or decease in the Contract Price or an extension or shortening of
the Contract Time, an equitable adjustment will be made as provided in Article
11 or Article 12. A Change Order signed by the Contractor indicates his
agreement therewith.
Paragraph 10.3 of the general conditions states:
Additional Work performed by the Contractor without authorization of a
Change Order will not entitle him to an increase in the Contract Price or an
extension of the Contract Time, except in the case of an emergency as
provided by paragraph 6.25.
Accordingly, TRA asserts that Gray never obtained a change order to cover the extra work
asserted by the March 1, 2002, claim letter. Therefore, according to TRA, it is not obligated
to compensate Gray for any additional work outside the contract price which was not covered
by change orders number 1, number 2, or number 3.
14
¶28. However, Gray claims that TRA waived its contractual rights to require change orders
for extra work through representations by TRA’s agent, Steve Brister. Gray asserts that
Brister made continuing promises of a final change order which would compensate Gray and
Ragland for any extra work performed. Also, Gray points out that change orders number 1,
number 2, and number 3 were all issued after the extra work had begun. Therefore, Gray
asserts that Gray and Ragland proceeded with additional work under the reasonable belief
that a final change order would be issued by TRA based on TRA’s “persistent pattern of
conduct.”
¶29. “Generally, a contractor who proceeds with work without procuring a written change
order proceeds at his peril.” City of Mound Bayou v. Collins, 499 So. 2d 1354, 1358 (Miss.
1986). That is to say, “[a] contractor should secure a written change order before beginning
additional construction work.” Id. However, Mississippi has recognized that there are
exceptions, “even where the contract requires a change to be executed in writing.” Id. (citing
Baum & Co. v. Covert, 62 Miss. 113 (1884)). In fact, a contractor may recover if the extra
work was “orally ordered, requested, directed, authorized or consented by the owner or his
duly authorized agent.” Id. at 1358-59 (quoting 2 A.L.R.3rd 620, 661 (1965)). Thus, while
TRA’s contract with Gray requires a written change order for compensation of extra work,
TRA may have waived this contractual provision by a persistent pattern of conduct. Such
a determination depended upon the facts and the parties’ pattern of conduct, and was a proper
jury question.
15
¶30. “With respect to waivers in general, this Court has long held that a party to a contract
may by words or conduct waive a right to which he would otherwise have been entitled.”
Canizaro v. Mobile Communications Corp., 655 So. 2d 25, 29 (Miss. 1995). Therefore, “the
writing requirement contained in the contract could itself be waived by the subsequent
conduct of the parties.” Id. (citing Eastline Corp. v. Marion Apartments, Ltd., 524 So. 2d
582, 584 (Miss. 1988)).
¶31. In Citizens National Bank of Meridian v. L.L. Glascock, Inc., 243 So. 2d 67 (Miss.
1971), a case which TRA asserts is factually similar to our case today, we refused to allow
a contractor compensation for extra work which was not pre-approved by a written change
order. In Glascock, the owner and contractor entered into a written contract for the
demolition of an existing bank building and for the construction of a new bank building upon
the same premises. Id. at 68. Since encountering the old foundation was anticipated, the
contractor surveyed the site for placement of the new concrete piling. Id. However, the old
concrete piling obstructed the placement of the new piling; thus, the contractor was required
to remove the old piling. Id. The removal of the old piling was the basis for the contractor’s
claim because the contractor considered the removal to be extra work not contemplated by
the contract. Id. While the contractor and engineer disputed whether the engineer ordered
the contractor to remove the concrete piling, the fact remained that the contractor did not
seek a written change order from the owner before the removal, as required by the contract.
Id. This Court concluded:
16
The written contract anticipated every contingency upon which this suit was
based. Its very purpose was to forestall imposition of vague claims derivative
of custom within the trade with which laymen are often unfamiliar. The
owner, being desirous of limiting its financial obligation, should not have its
pocketbook exposed to the custom of architects and contractors unless it agrees
thereto. In this instance the owner agreed to pay for extra work only if it was
authorized in writing prior to its execution. Having contracted directly upon
the point, there was no leeway for an award on a quantum meruit basis.
Id. at 70-71.
¶32. However, we find that today’s case is distinguishable from Glascock. Had Gray never
requested nor received previous change orders after the start/completion of extra work, TRA
would be entirely correct in its assertion that the contract controlled. But those are not the
facts before us. While it is true that Brister disputes being aware of extra work above and
beyond the work authorized by change orders number 1, number 2, and number 3, or
guaranteeing a final change order to cover all extra work, the fact remains that TRA
repeatedly issued change orders to Gray after work was begun. Never did Gray actually
receive a written change order before starting extra work. Of significant import is that TRA
wanted the Project completed on time. Brister testified that change orders could take up to
two weeks to be issued because all agency members had to get together and vote on them.
Shawn Gray testified Jesco’s project manager repeatedly told Gray that time was of the
essence. Shawn Gray particularly stated,
the project manager for this project, Jesco, directed us in time of essence, in
time of essence. You proceed with this work, we’ll get a change order. Yes,
a change order will come. Yeah, there continued to be changes.
....
17
These were discussions that was (sic) several times a week. So, hey, they told
us to proceed with the work. We did. Change order will follow. Yes, it did
on three occasions, but it didn’t on the final occasions.
So we took that, we was directed to go to work. Yeah, promised change order,
promised change order, go. We took that on faith.
Additionally, in Glascock, the extra work performed by the contractor was anticipated under
the written contract. Gray and Ragland were unaware of the defective plans and
specifications for the electrical work designed by Allen & Hoshall until after bidding on the
contract. Thus, Gray and Ragland could not have anticipated the extra work they needed to
perform for TRA.
¶33. To demonstrate waiver on the part of TRA, Gray cites Eastline Corp. v. Marion
Apartments, Ltd., 524 So. 2d 582 (Miss. 1988) and Sentinel Industry Contracting Corp. v.
Kimmins Industry Service Corp., 743 So. 2d 954 (Miss. 1999). In Eastline, the contractor,
Eastline, entered into a construction contract that contained a clause requiring change orders
before performance of additional work. Eastline, 524 So. 2d at 583. After Eastline
encountered multiple problems with the construction plans, it was instructed to undertake
extra work to get the project completed. Id. at 584. While Eastline requested change orders
from the owner for the additional work, it was under pressure to get the job finished and to
avoid further delay. Id. Thus, Eastline went ahead and did the additional work without first
obtaining a change order, because the owner’s representatives told Eastline, “Get the project
done. Get it done. We’ll take care of it later.” Id. This Court reversed the chancellor and
reiterated a long-standing Mississippi principle that “a written contract can be orally
18
modified.” Id. (“An oral modification may be made even where the contract provides that
modification must be in writing.”).
¶34. Although it is apparent that the contract between TRA and Gray required a written
change order before Gray could obtain compensation for extra work, TRA waived that
particular contract provision.
Among the acts or conduct amounting to waiver are the owner’s knowledge
of, agreement to, or acquiescence in such extra work, a course of dealing
which repeatedly disregards such stipulation, and a promise to pay for extra
work, orally requested by the owner and performed in reliance on that promise.
Eastline, 524 So. 2d at 584. As demonstrated supra, TRA’s persistent pattern of conduct of
issuing change orders after extra work had begun, Gray’s reasonable belief that a final
change order would be issued covering all extra work, and Brister’s representations (as
TRA’s agent), taken as a whole, clearly waived the contract provisions requiring a written
change order. Since the evidence must be construed in the light most favorable to Gray, and
Gray must be given the benefit of all reasonable inferences that can be drawn from the
evidence, the jury verdict cannot be set aside on appeal. White, 932 So. 2d at 32. The jury
verdict is no doubt supported by credible evidence. Thus, this issue is without merit.
B. Statutory and Common Law Safeguards Pertaining to Public
Construction Contracts.
¶35. TRA claims that competitive bidding laws prohibit TRA from paying Gray for
changes or modifications to the construction contract because the changes were not
“commercially reasonable” as required by Miss. Code Ann. § 31-7-13 (Rev. 2005).
Specifically, section 31-7-13 provides, in relevant part:
19
All agencies and governing authorities shall . . . contract for public
construction . . . as herein provided.
....
(g) Construction contract change authorization. – In the event a
determination is made by an agency or governing authority after a construction
contract is let that changes or modifications to the original contract are
necessary or would better serve the purpose of the agency or the governing
authority, such agency or governing authority may, in its discretion, order such
changes pertaining to the construction that are necessary under the
circumstances without the necessity of further public bids; provided that such
change shall be made in a commercially reasonable manner and shall not be
made to circumvent the public purchasing statutes. In addition to any other
authorized person, the architect or engineer hired by an agency or governing
authority with respect to any public construction contract shall have the
authority, when granted by an agency or governing authority, to authorize
changes or modifications to the original contract without the necessity of prior
approval of the agency or governing authority when any such change or
modification is less than one percent (1%) of the total contract amount. The
agency or governing authority may limit the number, manner or frequency of
such emergency changes or modifications.
Miss. Code Ann. § 31-7-13(g) (Rev. 2005).
¶36. On the other hand, Gray argues that TRA cannot claim immunity from liability when
TRA authorized the extra work and it was reasonable and necessary for the completion of
the Project. Gray asserts that the additional work performed by Gray and Ragland was
necessary because Allen & Hoshall’s initial plans and specifications for the electrical portion
of Component C were defective. Therefore, the cost of performance increased as a direct
result of Ragland having to correct the plans and specifications after a three-month delay
caused by Allen & Hoshall’s unsuccessful attempt to do so. Additionally, the changes to the
plans and specifications required more labor, equipment and material than originally was
contemplated when Gray prepared its bid.
20
¶37. To support its position, TRA refers to opinions from the Attorney General. While the
Attorney General’s opinions are in no way binding upon this Court, such opinions “may
certainly be considered by the Court.” Madison County v. Hopkins, 857 So. 2d 43, 50 (Miss.
2003) (citing City of Durant v. Laws Constr. Co., 721 So. 2d 598, 604 (Miss. 1998)). TRA
cites 1994 Miss. AG Lexis 28 (January 26, 1994), which states in relevant part:
We have also long held the view that when there has been no official action
approving in advance additional work by a contractor, the Board of
Supervisors is without authority to make payment for that additional work. We
stand by that statement today. However, for clarification purposes, we hold
today that reasonable variations from estimated quantities in the unit price
contract setting, do not constitute “additional work” or a change in the terms
of the contract. . . .
....
Of course, where the plans and specifications of the original contract are
modified or the scope of the work changed, the governing authority must
approve a Change Order prior to the additional work being done. Otherwise,
payment for the additional work cannot be authorized.
However, in a later Attorney General opinion, which cites Baker, and specifically addresses
Miss. Code Ann. § 31-13-7(g), the opinion concluded:
As a general proposition, when there has been no official action approving in
advance additional work by a contractor, a governing authority is not permitted
to pay for the additional work. However, if a contract is to be performed and
paid upon a “unit price,” a governing authority may find, consistent with fact,
and encompass such findings in an order spread upon its minutes, that a
proposed change order is necessary or incidental to the completion of the work
as originally bid, is commercially reasonable, is not made to circumvent the
public purchasing statutes, and that the increase in costs is reasonable, that
therefore approve the change order even after the work has been performed.
1994 Miss. AG Lexis 130 (April 9, 1999). Thus, while Baker stands for two pertinent
points: (1) variations from the unit price are not considered “additional work;” and (2) where
21
there has been no official action approving in advance additional work by a contractor, a
governing authority is not permitted to pay for the additional work; Honea further expands
the second point by permitting payment for additional work when such additional work is
necessary or incidental to the completion of the project, commercially reasonable, not made
to circumvent the public purchasing statutes, and the increase in costs is reasonable.
¶38. Clearly, some of the additional work performed by Gray and Ragland is a direct result
of the defective plans submitted by Allen & Hoshall. Ragland was required entirely to
redraw and reconfigure the plans and specifications for the electrical portion of Component
C. Not only did unit quantities increase, but so did labor costs, equipment costs, and
overhead costs submitted by Gray and Ragland. The additional work being claimed by Gray
and Ragland, at least in part, was necessary to the completion of the project, commercially
reasonable, and not intended to circumvent the public purchasing statutes, and the increases
in costs were reasonable. The additional portion of the claim submitted by Gray and Ragland
is for adjustments to the quantity of the materials.
¶39. Next, TRA cites Farrish Gravel Co. v. Mississippi State Highway Commission, 458
So. 2d 1066 (Miss. 1984), where we denied a contractor damages for the increased cost of
petroleum products after the contract was due to expire. Id. This Court held:
When the State opens a project for bids, a contractor decides what the project
is worth. If he cannot make money on it, he does not have to bid on it and
good business judgment would dictate that he not enter a bid.
....
While sympathy may be extended to the contractors who lost large sums of
money in failing to perform those contracts, the blame must fall upon them.
Apparently before submitting their bids neither these contractors nor any other
22
contractors contacted or approached the Commission about modifying the
restrictive provision. Only after the contracts had overrun and the contractors
had incurred losses did they approach the Commission for help. The time was
too late. Action should have been taken before the bids were submitted.
Id. at 1070. TRA contends that Gray’s failure to provide Ragland with complete materials
for the bid, including the plans and specifications for Component A and B, not just
Component C, caused Gray and Ragland to underbid the contract; therefore, Gray cannot
redirect blame for its failure to properly bid on the project. However, Component C, which
was given to Ragland and on which Ragland placed a bid, was completely defective and was
the cause of most of the equitable adjustment claim. While Gray did not receive a change
order to correct all of the extra work performed by Gray and Ragland regarding Component
C, Gray did make TRA aware of the complications. Gray did not wait until the project had
overrun before approaching TRA for change orders. Therefore, for the reasons stated, we
find this issue to be without merit.
C. Extra-Contractual Damages.
¶40. TRA also alleges that the circuit court erred in denying TRA’s motion for directed
verdict by allowing the jury to consider Gray’s claim for delay damages. At trial, Gray
sought compensation for eighty-nine days of delay due to the errors and/or omissions to the
plans and specifications of Component C. The delay period extended from December 6,
2000, until April 5, 2001. Therefore, part of the delay arguably was covered by change order
number 1, which was issued on March 2, 2001. TRA refers to Paragraph 11.9 of the
23
contract, which is basically a no-damage-for-delay provision, to claim that Gray was not
entitled to recover delay damages.
¶41. Gray contends that, although part of the delay damage sought occurred before change
order number 1, none of the change orders issued by TRA included payment for time delays
and covered only corrections in quantity changes. In addition, Gray argues that change order
number 1 was issued before all the delay damages were incurred and corrections to the plans
and specifications were completed, and these additional changes were not addressed in
change order number 2 or number 3 because change order number 1 was the only change
order which dealt with the electrical portion of the Project. Therefore, Gray asserts that the
trial court was correct in denying TRA’s motion for directed verdict.
¶42. The no-damage-for-delay clause contained in the contract between TRA and Gray
states:
11.9 Claims For Delay Due To Change: No claim for delay damages will be
allowed the Contractor on account of change orders executed by him. In
support of this stipulation the following language will be set out on the face of
each change order:
“It is further understood and agreed that this modification
constitutes payment in full on behalf of the Contractor and its
Subcontractors and suppliers for all costs and markups directly
or indirectly attributable to the change order herein, for all
delays related thereto, and for performance of the changes
within the time frame stated.”
All three change orders issued for the project in question contained the above language that
the change order constituted payment in full for any delays related thereto.
24
¶43. We previously have held that “[c]ontractual no-damage-for-delay clauses are
enforceable, though they are construed strictly against those who seek their benefit.” Miss.
Transp. Comm’n v. SCI, Inc., 717 So. 2d 332, 338 (Miss. 1998). However, Mississippi law
now recognizes four exceptions to enforcing a no-damage-for-delay clause. Prior to our
decision in SCI, this Court had only once addressed and upheld the validity of a no-damage-
for-delay provision contained within a construction contract. Id. (citing Edward E. Morgan
Co. v. State Highway Comm’n, 212 Miss. 504, 54 So. 2d 742 (1951)). However, in SCI, we
acknowledged that other jurisdictions had found that “damages may be recovered for any
delay that: (1) was not intended or contemplated by the parties to be within the purview of
the provision; (2) resulted from fraud, misrepresentation, or other bad faith on the part of one
seeking the benefit of the provision; (3) has extended such an unreasonable length of time
that the party delayed would have been justified in abandoning the contract; or (4) is not
within the specifically enumerated delays to which the clause applies.” Id. (citing Green
Int’l, Inc. v. Solis, 951 S.W.2d 384, 387 (Tex. 1997); United States v. Metric Constructors,
Inc., 480 S.E.2d 447, 448 (S.C. 1997); J & B Steel Contractors, Inc. v. C. Iber & Sons,
Inc., 642 N.E.2d 1215, 1221 (Ill. 1994)). In SCI, this Court found that “[t]he Commission’s
refusal to grant extensions on a timely basis can reasonably be interpreted as active
interference or bad faith and would justify a damages award,” and that “[t]herefore, the ‘no
damages for delay’ provision does not preclude a damages award in this case.” Id. at 339.
¶44. Gray argues that the delay damages claimed by it do not arise from change order
number 1. Gray claims that its delay damages are premised on deficiencies in the plans and
25
specifications, TRA’s failure to timely resolve the deficiencies, and ongoing changes
throughout the Project for which TRA’s agent, Brister, promised Gray a final change order.
Gray asserts that since TRA never issued a final change order, Paragraph 11.9 has no
application.
¶45. Furthermore, Gray contends that even if paragraph 11.9 does apply, at least three of
the exceptions to enforcing a no-damage-for-delay provision in a contract under Mississippi
law are applicable in today’s case. Specifically, Gray argues that the delay in construction
due to the defective plans provided by TRA was not intended nor could the parties have
contemplated that such a delay would result; that TRA made a misrepresentation when
Brister repeatedly promised that a final change order would be issued to cover the extra
work; and that its damages were not within the specifically enumerated delays.
¶46. Since determining whether an exception applies is clearly a fact question for the jury,
the circuit court was correct in denying TRA’s motion for directed verdict. We conclude that
the circuit court did not err in refusing to grant a directed verdict as to delay damages;
therefore this issue is without merit.
D. Indemnification.
¶47. TRA contends that the trial court erred in denying its directed verdict as to Gray’s
claim for indemnification. Under well-settled Mississippi law, the obligation to indemnify
may arise in three different instances: “a contractual relation, from an implied contractual
relation, or out of liability imposed by law.” Bush v. City of Laurel, 215 So. 2d 256, 259
(Miss. 1968). Additionally, “[w]hen one person is required to pay money which another
26
person in all fairness should pay, then the former may recover indemnity from the latter in
the amount which he paid, provided the person making the payment has not conducted
himself in a wrongful manner so as to bar his recovery.” Id. at 259-60. Since both parties
agree that Gray’s claim for indemnification arises out of an implied contractual relationship
between Gray and TRA, we note that we previously have stated that two prerequisites of
noncontractual implied indemnity must be met: “(1) [t]he damages which the claimant seeks
to shift are imposed upon him as a result of some legal obligation to the injured person; and
(2) it must appear that the claimant did not actively or affirmatively participate in the wrong.”
Hartford Casualty Ins. Co. v. Halliburton Co., 826 So. 2d 1206, 1216 (Miss. 2001) (citing
Home Ins. Co. v. Atlas Tank Mfg. Co., 230 So. 2d 549, 551 (Miss. 1970)).
¶48. Thus, TRA first contends that Gray has failed to provide any proof that it (Gray) was
under a “legal obligation” to pay Ragland since, at the time of trial, there had been no verdict
or judgment forcing such payment. However, the circuit court noted that because of the
various claims asserted, it would be proper to deny the motion for directed verdict and allow
the jury to consider all the issues at the same time. In effect, Gray had put on sufficient
evidence to show that as a result of its contract with TRA, Gray sub-contracted with Ragland.
As a result, Ragland had no direct contractual relationship with TRA and could get paid only
through Gray.
¶49. Next, TRA asserts that Gray failed to meet the second prerequisite of showing that
Gray did not actively or affirmatively participate in the wrong. TRA asserts that the proof
offered at trial showed that Gray: delayed Ragland by failing to properly coordinate the
27
work with other subcontractors; failed to provide Ragland with all the needed documentation
regarding Component A and B of the project; failed to secure a written change order from
TRA to cover the alleged extra work incurred by Ragland; and failed to handle Ragland’s
payroll properly.
¶50. On the other hand, Gray contends that it did not actively participate in the wrongdoing
which caused damages to Ragland. Gray contends that the damages asserted by Ragland are
a direct result of the defective plans and specifications drawn by Allen & Hoshall for
Component C. Gray asserts that it was neither directly nor indirectly responsible for the
errors or omissions in the plans and specifications. Therefore, Gray asserts that TRA is
solely responsible for any problems which caused the increase in the costs which Ragland
claimed against Gray.
¶51. Since we are to consider the evidence in the light most favorable to Gray and give
Gray the benefit of all favorable inferences that reasonably may be drawn from the evidence,
we cannot say that the circuit court erred by denying TRA’s motion for directed verdict on
the issue of indemnification. White, 932 So. 2d at 32. Gray and TRA have different theories
as to who is responsible for Ragland’s damages; thus, the evidence the jury heard was of such
quality and weight that reasonable and fair-minded jurors could have reached different
conclusions. Id. Therefore, the trial court properly denied TRA’s motion for directed verdict
regarding Gray’s claim for indemnification. Accordingly, we find this issue to have no
merit.
II. GRAY’S MOTION FOR ADDITUR.
28
¶52. Gray raises only one issue in its cross-appeal as to TRA: Whether Gray is entitled to
an additur, since there is no justification for the discrepancy between the jury verdicts against
TRA and Gray. Gray contends the circuit court erred in not granting an additur as to Gray’s
judgment against TRA. However, Gray fails to cite any authority which demonstrates to this
Court that it is entitled to an additur. Failure to cite any authority in support of claims of
error precludes this Court from considering the specific claim on appeal. Grey v. Grey, 638
So. 2d 488, 491 (Miss. 1994); Matter of Estate of Mason v. Fort, 616 So. 2d 322, 327 (Miss.
1993) (citing R.C. Petroleum, Inc. v. Hernandez, 555 So. 2d 1017, 1023 (Miss. 1990));
Kelly v. State, 553 So. 2d 517, 521 (Miss.1989) (citing Brown v. State, 534 So. 2d 1019,
1023 (Miss. 1988), cert. denied, 490 U.S. 1007, 109 S. Ct. 1643, 104 L. Ed. 2d 158 (1989),
Shive v. State, 507 So. 2d 898 (Miss. 1987), and Pate v. State, 419 So. 2d 1324 (Miss.
1982)). See also Turner v. Turner, 612 So. 2d 1141, 1143 (Miss. 1993); Dew v. Langford,
666 So. 2d 739, 746 (Miss. 1995). We thus choose not to address the merits of this issue.
III. GRAY’S MOTION FOR JUDGMENT NOTWITHSTANDING
THE VERDICT (RAGLAND).
¶53. Since the circuit court denied Gray’s motion for a judgment notwithstanding the
verdict (JNOV), Gray asserts several reasons in its cross-appeal as to Ragland, why it
believes that the circuit court erred in not granting its motion. A motion for JNOV has the
same standard of review as a motion for directed verdict. Therefore, for us to reverse the
circuit court’s denial of a motion for JNOV, we must find when considering the evidence in
the light most favorable to Ragland and giving Ragland the benefit of all the favorable
29
interferences that may be reasonably drawn from the evidence, that reasonable jurors could
not have arrived at a contrary verdict. White, 932 So. 2d at 32. That is, we must find that
reasonable jurors could find only for Gray. However, “if there is substantial evidence in
support of the verdict . . . evidence of such quality and weight that reasonable and fair
minded jurors in the exercise of impartial judgment might have reached different
conclusions, affirmance is required.” Id.
A. Quantum Meruit.
¶54. As to the first issue in its cross-appeal against Ragland, Gray argues that the trial court
erred in denying Gray’s motion for a JNOV on Ragland’s quantum meruit claim.
Particularly, Gray asserts that Ragland sought recovery under both an express contract theory
and a quantum meruit theory. Gray contends that the claims are mutually exclusive.
¶55. However, Ragland claims that both theories of recovery are applicable in today’s case.
Ragland claims that under his express contract theory, Gray is obligated to Ragland for the
remaining balance on its oral contract. With regard to the quantum meruit claim, Ragland
claims that Gray owes Ragland for extra work that was outside the terms contemplated by
the oral contract.
¶56. “Quantum meruit recovery is a contract remedy which may be premised either on
express or ‘implied’ contract, and a prerequisite to establishing grounds for quantum meruit
recovery is claimant’s reasonable expectation of compensation.” In Re Estate of Fitzner,
881 So. 2d 164, 173 (Miss. 2003) (emphasis added) (citing Estate of Johnson v. Adkins, 513
So. 2d 922, 926 (Miss. 1987); Estate of Van Ryan v. McMurtray, 505 So. 2d 1015 (Miss.
30
1987); Wiltz v. Huff, 264 So. 2d 808, 810-11 (Miss. 1972)). The essential elements of
recovery under a quantum meruit claim are: “(1) valuable services were rendered or
materials furnished; (2) for the person sought to be charged; (3) which services and materials
were accepted by the person sought to be charged, used and enjoyed by him; and (4) under
such circumstances as reasonably notified person sought to be charged that plaintiff, in
performing such services, was expected to be paid by person sought to be charged.” Id. at
173-74 (citing Reed v. Weathers Refrigeration & Air Conditioning, Inc., 759 So. 2d 521,
525 (Miss. Ct. App. 2000).
¶57. Therefore, the doctrine of quantum meruit is applicable in today’s case, if the jury
reasonably believed that Ragland performed additional work not contemplated by its oral
contract with Gray, and that Gray accepted Ragland’s services and understood that Ragland
desired to be compensated for said services. As discussed infra, Ragland performed
additional work at Gray’s command which was not contemplated by the contract, and
Ragland is pursuing its claim for quantum meruit to recover for those services.
¶58. In fact, Gray admitted Ragland performed additional work not contemplated by the
contract in a letter issued by Mr. Kelly, Gray’s attorney, to TRA. The letter to TRA outlined
all of the various services which Ragland performed that had not been compensated by Gray.
Gray was seeking an equitable adjustment from TRA in order to pay Ragland and other
subcontractors.
¶59. Additionally, in Glascock, we stated that in order for a party to recover under a theory
of quantum meruit, “an award . . . would require a finding by the court that the labor was not
31
anticipated by the contract, and also that there were no provisions of the contract by which
payment could be made for unanticipated labor.” Glascock, 243 So. 2d at 70. That is exactly
what Ragland asserts today. While Ragland and Gray did have an oral contract, the contract
did not contemplate all of the extra work performed by Ragland. The oral contract also did
not contain a provision through which Ragland could request compensation for extra work
not anticipated by the contract. Thus, Ragland’s only form of recovery is based on quantum
meruit for services which were performed outside the original, oral contract. Since it was
reasonable for the jury to determine that Gray should be liable to Ragland under a legal
theory of quantum meruit, the circuit court did not err in denying Gray’s motion for JNOV
on the issue of whether Ragland was entitled to bring such a claim. We thus find this issue
to be without merit.
B. Damages Proved By Reasonable Certainty.
¶60. Next, Gray asserts that Ragland failed to prove its damages under the theory of
quantum meruit with reasonable certainty. In essence, Gray claims that Ragland’s proof of
damages was speculative and not supported by credible evidence.
¶61. To support its proposition, Gray cites Propellex Corp. v. Brownlee, 342 F.3d 1335,
1339 (Fed. Cir. 2003),8 which held:
Before a contractor can obtain the benefit of the total cost method, it must
prove: (1) the impracticability of proving its actual losses directly; (2) the
8
In Propellex, a contractor sought review of a final decision of the Armed Services
Board of Contract Appeals concerning two contracts the contractor had with the Department
of the Army.
32
reasonableness of its bid; (3) the reasonableness of its actual costs; and (4) lack
of responsibility for the added costs.
Id. at 1339 (citing Servidone Constr. Corp. v. United States, 931 F.2d 860, 862 (Fed. Cir.
1991)). The Court in Propellex also stated:
Where it is impractical for a contractor to prove its actual costs because it
failed to keep accurate records, when such records could have been kept, and
where the contractor does not provide a legitimate reason for its failure to keep
the records, the total cost method of recovery is not available to the contractor.
Id. at 1342. Thus, Gray’s argument that Ragland did not meet its burden of proof regarding
the total cost method is inapplicable. Ragland testified that the company did not keep
accurate records regarding payroll; therefore, while Gray is correct that Ragland does not
have sufficient evidence to prove the amount of damages Ragland is claiming by using the
total cost method, Ragland is not necessarily barred from recovery.
¶62. That being said, Ragland, as the plaintiff, “still carries the burden of proving the
amount of any damages with reasonable certainty.” Adams v. U.S. Homecrafters, Inc., 744
So. 2d 736, 740 (Miss. 1999). In Adams, this Court also stated:
Whatever the measure of damages, they may be recovered only where and to
the extent that the evidence removes their quantum from the realm of
speculation and conjecture and transports it through the twilight zone and into
the daylight of reasonable certainty. . . . This principle is of importance today,
as we remember that a measure of speculation and conjecture attends even
damage proof all would agree reasonably certain.
Id. at 740 (quoting Wall v. Swilley, 562 So. 2d 1252, 1256 (Miss. 1990)). Thus, while it is
true that Ragland must prove its amount of damages with reasonable certainty, Ragland:
should not be deprived of its right to recover because of its inability to prove
with absolute certainty the extent of the loss or the exact amount of money
33
unjustly and illegally collected, and the law does not require such absolute
accuracy of proof. . . . “The rule that damages, if uncertain, cannot be
recovered, applies to their nature, and not to their extent. If the damage is
certain, the fact that its extent is uncertain does not prevent a recovery.”
Adams, 744 So. 2d at 740 (quoting Billups Petroleum Co. v. Hardin’s Bakeries Corp., 217
Miss. 24, 37, 63 So. 2d 543, 548 (1953)).
¶63. Ragland claims that it demonstrated with reasonable certainty that it was entitled to
damages. Therefore, “unless the evidence is so speculative that no reasonable juror could
find more than nominal damages,” the trial court may not direct a verdict against the plaintiff.
Wall, 562 So. 2d at 1256. The Wall Court concluded that as long as a hypothetical,
reasonable jury could conclude on the evidence presented at trial that the plaintiff is entitled
to more than a nominal damage verdict, we must affirm the circuit court. Id. at 1257.
¶64. While Gray asserts that Ragland failed to offer sufficient evidence to take its damages
claim out of mere speculation and conjecture into reasonable certainty, it is important to note
the lack of dispute as to the existence of substantial damage. In fact, Gray admitted in its
letter to TRA, written by Mr. Kelly on March 1, 2002, that Ragland was owed at least
$458,178 for an equitable adjustment. The letter went further to prove Ragland’s damages
by stating, “Ragland [was] forced to perform design work for which [it was] not paid. . . .
Without a time extension for the extensive electrical delays . . . Ragland had no choice but
to accelerate the work in an attempt to meet the original schedule. This caused the work to
be less efficient and much more expensive than it would have been if the work could have
been completed with the full contract time, without delays due to defective designs.”
34
¶65. Ragland put on further proof at trial that it performed extensive engineering services
by re-drawing the plans and specifications for Component C because Allen & Hoshall’s plans
and specifications were defective. Ragland testified that Gray had represented to Ragland
that it had a greenfield before starting to dig trenches, only to discover that Gray’s previous
sub-contractors had laid numerous pipes underground around which Ragland had to dig,
resulting in more work. Gray agreed that pipes were in place throughout the site. It is also
important to point out that Gray never objected at trial to Ragland’s damage calculations nor
did Gray put on proof of its own to dispute Ragland’s claims. Thus, it is probable that a
hypothetical reasonable juror, hearing all the testimony at trial, could conclude that Ragland
proved its damage claim. We thus find this issue to be without merit.
C. Overwhelming Weight of The Evidence.
¶66. Gray next claims that the jury’s verdict was against the overwhelming weight of the
evidence and evinces passion and bias. However, Gray again fails to cite authority. Just as
in its additur claim above, failure to cite any authority in support of claims of error precludes
this Court from considering the specific claim on appeal. Grey v. Grey, 638 So. 2d 488, 491
(Miss. 1994); Matter of Estate of Mason v. Fort, 616 So. 2d 322, 327 (Miss. 1993) (citing
R.C. Petroleum, Inc. v. Hernandez, 555 So. 2d 1017, 1023 (Miss. 1990)); Kelly v. State,
553 So. 2d 517, 521 (Miss.1989) (citing Brown v. State, 534 So. 2d 1019, 1023 (Miss. 1988),
cert. denied, 490 U.S. 1007, 109 S. Ct. 1643, 104 L. Ed. 2d 158 (1989), Shive v. State, 507
So. 2d 898 (Miss. 1987), and Pate v. State, 419 So. 2d 1324 (Miss. 1982)). See also Turner
35
v. Turner, 612 So. 2d 1141, 1143 (Miss. 1993); Dew v. Langford, 666 So. 2d 739, 746
(Miss. 1995). For these reasons, we decline to address the merits of this issue.
D. Attorneys’ Fees Based Upon a Quantum Meruit Claim.
¶67. On January 12, 2006, the circuit court entered its Amended Final Judgment which
increased Ragland’s judgment against Gray to $1,216,605.20, for which Gray and Hartford
were jointly and severally liable as to $892,676. Regarding the circuit court’s increase of
$366,053.88, the sum of $340,220.53 represented the circuit court’s assessment of attorneys’
fees against Gray and Hartford and in favor of Ragland. However, Gray contends that if the
circuit court’s judgment based on the theory of quantum meruit should stand, as we have
previously determined that it must, the award of attorneys’ fees to Ragland must be reversed.
¶68. In essence, Gray correctly argues that unless provided by statute or contract, or unless
punitive damages are awarded, attorneys’ fees may not be recovered. Miss. Power & Light
Co. v. Cook, 832 So. 2d 474, 486 (Miss. 2002) (citing Aetna Cas. & Sur. Co. v. Steele, 373
So. 2d 797, 801 (Miss. 1979)). On the other hand, Ragland asserts that there are indeed two
relevant statutes which authorize the assessment of attorneys’ fees in today’s case, namely,
the Mississippi Litigation Accountability Act of 1988 (Miss. Code Ann. §§ 11-55-1, et seq.
(Rev. 2002)); and our construction claim statute (Miss. Code Ann. § 31-5-57 (Rev. 2005)).
¶69. Of significant import is that in the trial court’s separate order of January 12, 2006,
addressing various issues, including the issue of whether to assess attorneys’ fees in favor
of Ragland and against Gray, the trial judge stated, inter alia, that “[t]he facts surrounding
and concerning that portion of Ragland’s Motion for Assessment of Attorney’s Fees,
36
Prejudgment Interest and Penalty related to setting the amount of attorney’s fees justify, as
to both Gray and Hartford, an assessment of an attorney’s fee of forty percent (40%) of the
principal amount of the November 2, 2005 Judgment as amended which amount the Court
found to be reasonable and fair and which satisfied the requirements of law.” (Emphasis
added). So in essence, the trial judge incorporated into his order by reference the allegations
contained in Ragland’s motion relating to the issue of whether to award attorneys’ fees, and
if so, in what amount. By incorporating these allegations contained in this motion into his
order as a basis for justifying an award of attorneys’ fees, the trial judge obviously believed
the allegations to be true, inasmuch as by this time, the trial judge had before him the
extensive evidence offered during the course of the two-week trial. With this in mind, we
deem it critical here to reveal a summary of the allegations that were in Ragland’s Motion
for Assessment of Attorney’s Fees, Prejudgment Interest and Penalty, as the motion relates
to the issue of attorneys’ fees. On this issue, the motion referred to the aforementioned
Mississippi Litigation Accountability Act and the construction claim statute. The motion
also set out a detailed history of this case concerning, inter alia, Hartford’s alleged bad faith
in dealing with Ragland; Gray’s actions which were detrimental to Ragland; Gray’s
acknowledgment, through the trial testimony of Renee Gray, that Gray did not know of any
reason why Hartford had not paid Ragland’s claim; that Gray “sponsored” Ragland’s claim
of $458,178; that Ragland received no compensation for the extensive delays caused by the
defective plans; that Gray and Hartford persisted in refusing to pay Ragland; that during the
trial, Gray never denied that it was indebted to Ragland; that during the trial, Hartford
37
acknowledged that it was liable to Ragland to the same extent that Gray was liable to
Ragland; that Gray misrepresented to Ragland the amount that it paid for Ragland’s concrete;
that Gray solicited Ragland’s assistance in persuading TRA to release the retainage with full
knowledge by Gray that Ragland would not receive any of the retainage; and, that Gray
waited more than four years to pay Ragland the principal amount owed on 320 cy of sand,
without considering any accrued interest. Finally, the motion alleged that “[a]s a
consequence of the above, the defendants are liable for the payment of Ragland’s reasonable
attorney’s fees. The defendants had no regard for and violated Mississippi’s public policy
by forcing Ragland to file and prosecute this lawsuit. Their conduct greatly extended the life
of this litigation and exaggerated the issues and extended the time in trial while Ragland
proved that which the defendants knew to be the facts as evidenced by their utter failure to
dispute the testimony!”
¶70. Our standard of review concerning the issue of attorneys’ fees is abuse of discretion.
Bailey v. Estate of Kemp, 955 So. 2d 777, 787 (Miss. 2007) (quoting Miss. Power & Light
Co. v. Cook, 832 So. 2d 474, 486 (Miss. 2002)). Pursuant to Miss. Code Ann. § 11-55-5
(Rev. 2002), “any court of record in this state . . . shall award, as part of its judgment and in
addition to any other costs otherwise assessed, reasonable attorney’s fees and costs against
any party or attorney if the court . . . finds that an attorney or party brought an action, or
asserted any claim or defense, that is without substantial justification.” 9 Miss. Code Ann. §
9
Pursuant to Miss. Code Ann. § 11-55-3(b), the word person “means any individual,
corporation, company, association, firm, partnership, society, joint stock company or any
38
31-5-57 (Rev. 2005), further reiterates the same public policy principles in public works
contracts by stating:
Whenever any person supplying labor or material in the prosecution of the
work brings an action on such payment bond and the trial judge finds that the
defense raised to such action by the contractor or surety was not reasonable,
or not in good faith, or merely for the purpose of delaying payment, then the
trial judge may, in his discretion, award the claimant a reasonable amount to
be determined by the trial judge as claimant’s attorney’s fees in bringing such
successful action.
Id.
¶71. Based on these two statutes and our case law, we find from the record before us that
the circuit court did not abuse its discretion in awarding attorneys’ fees to Ragland and
against Gray and Hartford. See In Re Estate of Ladner, 909 So. 2d 1051, 1055-56 (Miss.
2004) (chancellor’s award of attorneys’ fees justified under Litigation Accountability Act
and Miss. R. Civ. P. 11); Key Constructors, Inc., v. H & M Gas Co., 537 So. 2d 1318, 1324-
25 (Miss. 1989) (Miss. Code Ann. § 31-5-57 provides for award of reasonable attorneys’ fees
upon the furnishing of an evidentiary predicate therefor). Gray delayed paying Ragland the
remaining balance on its contract for no apparent reason. Gray knew that Ragland was
entitled to the money, but withheld the money and has continued to do so. Further, Gray
solicited and secured Ragland’s efforts to persuade TRA to release the retainage, inducing
other entity, including any governmental entity or unincorporated association of persons.”
Likewise, pursuant to section 11-55-3(a), the phrase “without substantial justification,” for
the purpose of this statute and “when used with reference to any action, claim, defense or
appeal, including without limitation any motion, means that it is frivolous, groundless in fact
or in law, or vexatious, as determined by the court.”
39
Ragland to believe that it would get its money when in fact Gray had already assigned the
entire retainage to its bank.
¶72. Additionally, Gray sought an equitable adjustment from TRA before trial in which it
admitted that Ragland was due $458,158 for additional work. However, it refused to pay
Ragland this additional money “without substantial justification.” In fact, in Gray’s Third
Party Complaint, Gray requested payment from TRA for an amount which included
Ragland’s $458,178.
¶73. In sum, for the reasons stated, we find that the trial court did not abuse its discretion
in assessing attorneys’ fees in favor of Ragland and against Gray; therefore, this issue is
without merit.
E. Excessive Attorneys’ Fees.
¶74. Next, Gray asserts that the amount of attorneys’ fees awarded by the trial court was
set without any meaningful analysis; thus, the fees were not supported by findings of fact.
Therefore, even though we have found that the trial court appropriately assessed attorneys’
fees in favor of Ragland and against Gray, we still must determine if the amount of attorneys’
fees awarded was excessive.
¶75. Again, as stated, supra, the trial judge in essence incorporated into his order by
reference the allegations contained in Ragland’s motion relating to the issue of whether to
award attorneys’ fees, and if so, in what amount. Also, we again state that the trial judge
likewise had the benefit of the extensive evidence offered during the course of the two-week
trial. Additionally, attached to Ragland’s Motion for Assessment of Attorney’s Fees,
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Prejudgment Interest and Penalty was the sworn affidavit of Ragland’s attorney, Thomas W.
Prewitt. The affidavit detailed, inter alia, that Prewitt was employed by Ragland to prosecute
Ragland’s claim against Hartford and Gray in May of 2002. While Prewitt and Ragland did
not have a written employment contract, Ragland and Prewitt agreed to a forty-percent
contingent fee arrangement.
¶76. At the time the affidavit was prepared, Prewitt, a sole practitioner, had been engaged
in the active practice of law for more than forty-five years, and for more than forty years of
that time, he had concentrated on the resolution of disputes in the construction industry.
Prewitt’s normal hourly rate at the time Ragland employed Prewitt was $225. However,
shortly after being employed by Ragland, Prewitt’s hourly rate increased to $250. That being
said, Prewitt’s affidavit stated that $250 was a rate customarily charged by competent
attorneys for this type of work in this geographic area. Based on Prewitt’s hourly rate and
the hourly rate of his legal assistants, Prewitt stated that he would have billed Ragland in
excess of $300,000 for his legal services.10 In his sworn affidavit, Prewitt also stated that for
the four weeks prior to the trial of this case, he averaged more than ten hours per day working
on this one case, and that during the twelve days immediately prior to the commencement
of the trial, he devoted eighteen hours per day working on this case. As of the execution of
10
Attached to Prewitt’s affidavit are forty-three pages of detailed time reports detailing
the dates, hours, hourly rate, description of services rendered, and by whom rendered. These
time reports reveal a total charge of $172,326; however, in his affidavit, Prewitt explains this
discrepancy ($172,326 vs. “over $300,000”) by stating that as of the middle of June 2005,
he and his staff became totally focused on preparation for the late-July trial, thus preventing
accurate record keeping after the middle of June.
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the affidavit, Prewitt had received no attorneys’ fees in this case, although Ragland had
reimbursed Prewitt for some of his expenses.
¶77. Furthermore, Prewitt’s affidavit stated:
I am familiar with the McKee factors and the requirements of Canon 1.5 of the
Code of Professional Responsibility related to attorney’s fees and have taken
those into account in reaching the figure requested in this Affidavit. I am
familiar with and have previously applied the factors identified in In Re
[Estate] of Alexander Taylor Gillies, Jr., 830 So. 2d 640 (Miss. 2002) and
have taken them into account when arriving at the request contained in this
Affidavit.
Additionally, we note that Prewitt requested attorneys’ fees in the amount of $411,488.84;
however, the trial court awarded attorneys’ fees in the amount of $340,220.53, which amount
was more than $71,000 less than the amount requested by Prewitt and Ragland.
¶78. Sections 11-55-5 and 31-5-57 both require that an assessment of attorneys’ fees must
be in an amount deemed to be reasonable. We must start our analysis of this issue with the
United States Supreme Court’s decision in Hensley v. Eckerhart, 461 U.S. 424, 103 S. Ct.
1933, 76 L. Ed. 2d 40 (1983), in which the Supreme Court adopted the “lodestar” method of
calculating reasonable attorneys’ fees. The Court stated the amount of attorneys’ fees
understandably had to be determined based on the facts of each case. Hensley, 461 U.S. at
429, 103 S.Ct. at 1937. The Court likewise set out the twelve factors to be considered in
determining a reasonable attorneys’ fee to be awarded: “(1) the time and labor required; (2)
the novelty and difficulty of the questions; (3) the skill requisite to perform the legal service
properly; (4) the preclusion of employment by the attorney due to acceptance of the case; (5)
the customary fee; (6) whether the fee is fixed or contingent; (7) time limitations imposed by
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the client or the circumstances; (8) the amount involved and the results obtained; (9) the
experience, reputation, and ability of the attorneys; (10) the “undesirability” of the case; (11)
the nature and length of the professional relationship with the client; and (12) awards in
similar cases.” Id. at 1938 (citing Johnson v. Georgia Highway Express, Inc., 488 F.2d
714, 717-719 (5 th Cir. 1974)).
¶79. Rule 1.5 of the Mississippi Rules of Professional Conduct sets out several factors
which the trial court should consider in determining the reasonableness of the amount of
attorneys’ fees. Other than a minor rewording and reordering, these factors are virtually
identical to the factors set out by the United States Supreme Court in Hensley. The
Mississippi factors are:
(1) the time and labor required, the novelty and difficulty of the questions
involved, and the skill requisite to perform the legal service properly;
(2) the likelihood, if apparent to the client, that the acceptance of the particular
employment will preclude other employment by the lawyer;
(3) the fee customarily charged in the locality for similar legal services;
(4) the amount involved and the results obtained;
(5) the time limitations imposed by the client or by the circumstances;
(6) the nature and length of the professional relationship with the client;
(7) the experience, reputation, and ability of the lawyer or lawyers performing
the services; and
(8) whether the fee is fixed or contingent.
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Miss. R. Prof. Conduct 1.5(a). A close reading of our Mississippi factors reveals that the
only Hensley factor which is not included in Rule 1.5, in some shape, form or fashion, is “the
‘undesirability’ of the case.”
¶80. In McKee v. McKee, 418 So. 2d 764, 767 (Miss. 1982), this Court stated that factors
to be considered in an award of attorneys’ fees included “the relative financial ability of the
parties, the skill and standing of the attorney employed, the nature of the case and novelty
and difficulty of the questions at issue, as well as the degree of responsibility involved in the
management of the cause, the time and labor required, the usual and customary charge in the
community, and the preclusion of other employment by the attorney due to the acceptance
of the case.” Id. at 767. The McKee factors are strikingly similar to the factors set out in
Miss. R. Prof. Conduct 1.5(a).
¶81. We have stated that “[t]he trial court is the appropriate entity to award attorneys’ fees
and costs.” Mabus v. Mabus, 910 So. 2d 486, 488 (Miss. 2005) (citing Cook, 832 So. 2d at
478). Therefore, a trial court’s decision regarding attorneys’ fees will not be disturbed by
an appellate court unless it is manifestly wrong. Mabus, 910 So. 2d at 488. “The word
‘manifest,’ as defined in this context, means ‘unmistakable, clear, plain, or indisputable.’”
Id. (quoting Mosley v. Atterberry, 819 So. 2d 1268, 1272 (Miss. 2002)). The controlling
factor is “what is reasonable.” BellSouth Pers. Commun., LLC v. Bd. of Supervisors, 912
So. 2d 436, 446 (Miss. 2005) (quoting Mauck v. Columbus Hotel, 741 So. 2d 259, 271
(Miss. 1999)). Unless we determine that the trial judge in today’s case abused his discretion
44
in the amount of attorneys’ fees assessed, we are duty-bound to affirm. Mabus, 910 So. 2d
at 488.
¶82. In BellSouth, we stated:
The United States Supreme Court adopted the “lodestar” method of calculating
reasonable attorney fees. In calculating the “lodestar” fee, the most useful
starting point for determining the amount of a reasonable fee is the
number of hours reasonably expended on the litigation, multiplied by a
reasonable hourly rate. This calculation provides an objective basis on
which to make an initial estimate of the value of a lawyer’s services. . . .
BellSouth, 912 So. 2d at 446-47 (quoting In re Estate of Gillies, 830 So. 2d 640, 645 (Miss.
2002)). Therefore, a trial court’s award of attorneys’ fees will be on course for probable
affirmance on appeal if the trial judge used as a starting point the number of hours reasonably
expended on the litigation, multiplied by a reasonable hourly rate, after which the issue of
attorneys’ fees must then be appropriately considered in light of Miss. R. Prof. Conduct
1.5(a) and the McKee factors. BellSouth, 912 So. 2d at 447.
¶83. In today’s case, the trial court’s order awarding attorneys’ fees in favor of Ragland
stated in pertinent part:
The facts surrounding and concerning that portion of Ragland’s Motion For
Assessment of Attorney’s Fees, Prejudgment Interest and Penalty related to
setting the amount of attorney’s fees justify, as to both Gray and as to
Hartford, an assessment of an attorney’s fee of forty percent (40%) of the
principal amount of the November 2, 2005 Judgment as amended which
amount the Court found to be reasonable and fair and which satisfied the
requirements of law.
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(Emphasis added). Again, the language of this order convinces us that the trial judge adopted
by reference the assertions of Ragland in his motion, and the assertions of Ragland’s attorney
in his sworn affidavit attached as an exhibit to Ragland’s motion.
¶84. The trial judge determined that a fee of forty percent of the principal amount of the
judgment was reasonable; thus, he awarded Ragland forty percent of his judgment against
Gray for attorneys’ fees, totaling $340,220.53. If the record before us indicated that the trial
court made a carte blanche assessment of attorneys’ fees based on a forty-percent
contingency basis, we would unhesitatingly reverse this award and remand for an evidentiary
hearing, especially in light of the fact that the oral contract for a contingency fee was
between Ragland and Prewitt, a contract to which Gray and Hartford were not parties. After
all, the United States Supreme Court in Hensley acknowledged that the “American Rule”
provides that “each party in a lawsuit ordinarily shall bear its own attorney’s fees” absent the
existence of certain circumstances, such as statutory authority. Hensley, 461 U.S. at 429,
103 S.Ct. at 1937.
¶85. However, on the other hand, the record before us reveals, inter alia, that the trial judge
presided over a two-week trial in which numerous witnesses testified, and more than one
hundred exhibits were received into evidence; that the trial judge had his recall of the
evidence including that evidence revealing to the judge and jury the conduct of the
participants in the Project. Furthermore, the trial judge had before him Ragland’s motion for
assessment of attorneys’ fees, with the attached sworn affidavit of Ragland’s attorney, which
motion and/or affidavit referred to Miss. Code Ann. §§ 11-55-5 and 31-5-57; the McKee
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factors; Miss. R. Prof. Conduct 1.5(a); In Re Estate of Gillies, 830 So. 2d 640 (Miss. 2002);
as well as setting out information relating to the McKee factors. We already have
acknowledged that these factors are virtually identical to the Hensley factors adopted by the
United States Supreme Court. The record also shows that the trial judge’s amended final
judgment, inter alia, assessed attorneys’ fees by reference to the order entered the same day
as the amended final judgment; and that the trial judge entered his order which, inter alia,
assessed attorneys’ fees in favor of Ragland and against Gray and Hartford in the sum of
$340,220.53 (albeit based on forty-percent of the principal amount of the judgment), by
stating that “the facts surrounding and concerning that portion of Ragland’s” motion for
attorneys’ fees “related to setting the amount of attorney’s fees justify” the assessment of the
attorneys’ fees in an amount which the trial judge “found to be reasonable and fair and which
satisfied the requirements of law.” We thus find from the totality of the evidence that the
amount of attorneys’ fees assessed against Gray and Hartford and in favor of Ragland is
justified, and the trial judge did not abuse his discretion in assessing attorneys’ fees in the
amount of $340,220.53. Accordingly, we find this issue to be without merit.
F. Remittitur.
¶86. Gray contends that the trial court should have granted its motion for a new trial on
damages or issued a remittitur. To support his proposition, Gray cites Cade v. Walker, 771
So. 2d 403, 407 (Miss. Ct. App. 2000) which held that a remittitur may be ordered if either
“(1) the jury or trier of fact was influenced by bias, prejudice, or passion; or (2) the damages
awarded were contrary to the overwhelming weight of the credible evidence.” Since this
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issue basically is encompassed in Gray’s argument that the damages were not proved with
reasonable certainty, this issue has been addressed and lacks merit. The trial court did not
err in denying Gray’s request for a remittitur; therefore, we find this issue to be without
merit.
IV. RAGLAND’S MOTION TO DIRECT THE CLERK TO PAY
RAGLAND THE MONEY TRA PAID INTO COURT.
¶87. On December 12, 2005, TRA paid the sum of $260,437.78 into the Lee County
Circuit Court’s registry to satisfy the entire judgment plus interest in favor of Gray.
Thereafter, on December 13, 2005, the trial judge entered an order providing that the
judgment against TRA in favor of Gray “is satisfied and canceled.” The order further
directed that the lien upon all the real, personal or mixed property of TRA should be satisfied
and canceled.
¶88. Thereafter, on December 29, 2005, Ragland and Hartford entered into a Full, Final,
and Absolute Release and Assignment in which Hartford assigned to Ragland all of its rights
in the money TRA paid into the court’s registry. Since Gray previously had assigned its
rights in the judgment to Hartford, Ragland now obtained all the rights to the money which
TRA paid into the court’s registry. Thus, Ragland filed a Motion to Require the Circuit
Clerk to Pay Ragland the Funds TRA Paid Into Court. On January 6, 2006, TRA opposed
Ragland’s motion and asked the circuit court to allow TRA’s payment of judgment to serve
as collateral for a supersedeas bond. On January 17, 2006, the circuit court entered an order
denying Ragland’s motion to require the circuit clerk to deliver TRA’s paid judgment to
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Ragland and granting TRA’s motion to post a supersedeas bond by posting a bond equal to
twenty-five percent of the judgment. Once TRA posted a bond equal to 25% of the
judgment, the court’s registry contained a bond equal to 125% of the judgment against TRA.
¶89. Ragland contends that TRA’s motion opposing the circuit clerk paying Ragland and
seeking appeal should have been denied. Essentially, Ragland contends that, once TRA paid
its judgment and then made an ore tenus motion to have the payment serve to have the
judgment satisfied and canceled and the lien from its property removed, TRA had no further
claim to the money. According to Ragland, since TRA had no further claim to the money,
the money could not serve as security for an appeal.
¶90. Ragland complains that he suffered disproportionate and irreparable harm because he
no longer had the procedural safeguards of a judgment lien against TRA’s property.
Additionally, Ragland contends that the circuit court did not protect the prevailing party,
Ragland. However, Ragland’s contentions do not stand muster. M.R.A.P. 8 permits the trial
court to grant a stay provided that the interests of the prevailing party are secure.
¶91. In re Estate of Taylor, 539 So. 2d 1029, 1029 (Miss. 1989) was the first Mississippi
Supreme Court case to address what is now M.R.A.P. 8 “relating to a stay of judgment
pending appeal under a supersedeas bond.” In Taylor, we stated:
The procedure by which an unsuccessful litigant seeks a stay of the execution
of a judgment appealed from is a supersedeas. The granting of a supersedeas
commands the staying of a proceeding at law and prohibits the enforcement of
the trial court’s judgment pending review. To secure such stay of proceedings,
it is necessary that the litigant secure a sufficient bond in the amount set by the
trial judge.
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. . . . the general purpose of the supersedeas bond, []is to effect absolute
security to the party affected by the appeal. In Re Watkins’ Estate, 114 Vt.
109, 41 A.2d 180 (1944); Ricci v. Bove’s Estate, 116 Vt. 335, 75 A.2d 682
(1950). The amount of a supersedeas bond should be sufficient to protect the
appellee in his judgment; therefore, it should insure the payment of the
judgment and interest, and any waste that could occur pending the appeal. If
the appeal is affirmed, the appellee should be able to satisfy the payment of the
judgment in full, together with costs, interest, and the damages for delay.
The bond is the typical means of giving the appellee security. However, the
Court may approve security in the form of cash or property. The judgment
may be secured in other ways such as the Court’s taking possession of personal
property or otherwise providing for a method to insure payment of the
appellee’s judgment.
Id. at 1031.
¶92. In this case, Ragland’s interests are secure, although Ragland contends otherwise.
TRA paid into the court’s registry one hundred percent of the judgment against it, plus all
interest. In addition to one hundred percent of TRA’s judgment, TRA paid an additional
twenty-five percent of the judgment to serve as a supersedeas bond. Therefore, Ragland is
more protected than he would have been if TRA had simply posted a bond of one hundred
twenty-five percent, because there is an actual money judgment in the court’s registry.
Under the Supreme Court guidelines set out in Taylor, TRA has satisfied the purpose of
posting a supersedeas bond and is entitled to an appeal.
¶93. Next, Ragland cities Anderson v. T.G. Owen & Son, Inc., 231 Miss. 633, 97 So. 2d
369 (Miss. 1957), to support its proposition that satisfaction of a judgment is prima facie
evidence that a creditor has received the money. Id. at 370. Thus, Ragland contends that the
money paid into the court’s registry immediately should be payable to it. Ragland is
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mistaken. Once Ragland obtained an interest in the judgment paid by TRA, Ragland did not
have a immediate right to collect that judgment. Ragland, as the prevailing party, merely had
a right to have its interest in that judgment protected until the appeal process was complete.
M.R.A.P 8.
¶94. Furthermore, Ragland contends that judicial estoppel should preclude TRA from
staying the execution of the judgment. Particularly, Ragland cites Richardson v. Cornes,
903 So. 2d 51, 56 (Miss. 2005), which stated, “[j]udicial estoppel precludes a party from
asserting a position, benefitting from that position, and then, when it becomes more
convenient or profitable, retreating from that position later in the litigation.” That being said,
“a party cannot assume a position at one stage of a proceeding and then take a contrary stand
later in the same litigation.” Id. This is not what TRA did. TRA does not seek to reclaim
the money paid into the court’s registry. TRA requested that the execution on the judgment
be stayed pending the outcome of this appeal. Ragland’s assertion that judicial estoppel
precludes TRA from staying the execution of the judgment lacks merit.
¶95. In addition, it would be against public policy to punish a judgment debtor for paying
a judgment against the judgment debtor by denying the judgment debtor an appeal. Ragland
has not suffered disproportionate and irreparable harm because the circuit clerk still
possesses the paid judgment. While TRA has no interest in the money, other than requesting
that it stay in the court’s registry pending the outcome of the appeal, the interests of TRA and
Ragland both are protected. The trial judge did not err in denying Ragland’s motion and
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granting TRA’s motion to post a supersedeas bond and file an appeal. Therefore, this issue
lacks merit.
CONCLUSION
¶96. For the reasons stated above , the amended final judgment entered by the Circuit Court
of Lee County is affirmed on both direct appeal and cross-appeal.
¶97. ON DIRECT APPEAL: AFFIRMED; ON CROSS-APPEALS: AFFIRMED.
SMITH, C.J., WALLER AND DIAZ, P.JJ., DICKINSON, RANDOLPH AND
LAMAR, JJ., CONCUR. GRAVES, J., CONCURS IN RESULT ONLY. EASLEY,
J., NOT PARTICIPATING.
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