William Greenwood v. MESA Underwriters Specialty Insurance Company

IN THE SUPREME COURT OF MISSISSIPPI
NO. 2014-IA-00197-SCT
WILLIAM GREENWOOD d/b/a ANTIQUE WOOD
COMPANY OF MISSISSIPPI
v.
MESA UNDERWRITERS SPECIALTY
INSURANCE COMPANY, CENTRAL INSURERS
OF GRENADA, INC. AND DIXIE SPECIALTY
INSURANCE, INC.
DATE OF JUDGMENT: 01/24/2014
TRIAL JUDGE: HON. JEFF WEILL, SR.
TRIAL COURT ATTORNEYS: CHUCK McRAE
CLARK MONROE, II
ERIC PRICE
KATHRYN BREARD PLATT
KATRINA LYNN DANNHEIM
RICHARD E. KING
THOMAS LYNN CARPENTER
COURT FROM WHICH APPEALED: CIRCUIT COURT OF THE FIRST JUDICIAL
DISTRICT OF HINDS COUNTY
ATTORNEYS FOR APPELLANT: SETH CLAYTON LITTLE
CHUCK McRAE
ATTORNEYS FOR APPELLEES: THOMAS LYNN CARPENTER, JR.
CARR ALLISON
KATHRYN BREARD PLATT
NATURE OF THE CASE: CIVIL - INSURANCE
DISPOSITION: REVERSED AND REMANDED - 12/10/2015
MOTION FOR REHEARING FILED:
MANDATE ISSUED:
EN BANC.
KITCHENS, JUSTICE, FOR THE COURT:
¶1. After a lawsuit was filed against William Greenwood, doing business as Antique
Wood Company of Mississippi, Greenwood’s insurers, located in Rankin County and
Grenada County, denied indemnity coverage. Greenwood sued the insurers in the Circuit
Court of the First Judicial District of Hinds County, alleging breach of contract, conspiracy,
and bad faith. Following a grant of a motion for change of venue to the defendants,
Greenwood filed the instant petition for interlocutory appeal, which this Court granted.
Greenwood asserted that venue was proper in Warren County. We agree and reverse the
judgment of the Circuit Court of the First Judicial District of Hinds County and remand the
case for transfer to the Circuit Court of Warren County.
FACTS AND PROCEDURAL HISTORY
¶2. William Greenwood owned Antique Wood Company of Mississippi (Greenwood),
which was in the business of buying salvage rights to old buildings for the purpose of
stripping and selling the buildings’ lumber, bricks, and other materials. Greenwood obtained
salvage rights to a Vicksburg postbellum building1 built in 1868 and sought a policy of
insurance to cover “debris removal.” Central Insurers of Grenada, Inc. (Grenada), and Dixie
Specialty Insurance, Inc. (Dixie), obtained policies on behalf of Greenwood through Mesa
Underwriters Specialty Insurance Company (Mesa), formerly known as Montpelier US
Insurance Company (Montpelier).
1
The complaint states that the building is located at 707 through 713 Cluster Street
in Vicksburg, Mississippi. The City of Vicksburg is situated wholly in Warren County.
Mississippi Official & Statistical Register 363 (2012-2016).
2
¶3. Greenwood’s dismantling of the building resulted in a lawsuit filed by adjoining
building owners, who claimed that damage had resulted “to an adjacent building and wall.”
One of the adjoining business owners had “requested the demolition be stopped as it was
damaging and would continue to damage the adjacent property.” Ultimately, the owners said,
“the additional demolition caused substantial damage to the adjacent building.” A coverage
investigation by Montpelier resulted in a denial of coverage:
Our investigation revealed several issues concerning coverage. The
investigation revealed that you owned the building at the time you took out the
policy and did not choose to insure the property at that time. The signed
application states that your business is 100% debris removal. You told the
inspector that spoke to [you] concerning your business that you only pick up
legal landfill debris. The policy was written for debris removal only not the
taking down of buildings. Furthermore, the building was owned by you and the
resultant damage would arise out of the ownership, use[,] and maintenance of
the premises you own, of which we do not insure and were never put on notice
[]. For these reasons and the provisions in the policy we are unable to provide[]
indemnity or defense for the above mentioned claim.
Aggrieved by the denial of coverage for indemnity or defense, Greenwood sued Mesa (then
Montpelier), Grenada, and Dixie, in the Circuit Court of the First Judicial District of Hinds
County, alleging breach of contract, conspiracy, and bad faith.
¶4. Mesa and Dixie filed a motion to transfer venue on October 31, 2013, arguing that
Rankin County was the proper county for venue purposes under Mississippi Code Section
11-11-3(1)(a)(i) (Rev. 2004),2 because the in-state defendants, Dixie and Grenada, were
2
Mississippi Code Section 11-11-3(1)(a)(i) states:
Civil actions of which the circuit court has original jurisdiction shall be
commenced in the county where the defendant resides, or, if a corporation, in
the county of its principal place of business, or in the county where a
substantial alleged act or omission occurred or where a substantial event that
3
located in Rankin and Grenada Counties, respectively.3 Greenwood responded to the motion
to transfer venue by arguing that venue was proper in Warren County because the events
giving rise to the claim which resulted in the denial of coverage took place there.
¶5. The trial court ruled that Warren County was not a proper venue because “the
substantial act was the denial of the claim, which occurred in Rankin County, not the alleged
building demolition in Warren County.” The trial court also ruled that Greenwood’s venue
options against Dixie and Grenada were Rankin County or Grenada County. Greenwood filed
an interlocutory appeal on February 13, 2014, which was granted by a panel of this Court on
April 16, 2014.
¶6. The sole interlocutory issue before this Court is whether the trial court erred in its
determination that venue was not proper in Warren County and was proper only in Rankin
or Grenada Counties.
STANDARD OF REVIEW
¶7. “We review ‘a trial court’s grant or denial of a motion for change of venue for an
abuse of discretion, but questions of law, such as interpretation of the general venue statute,
are reviewed de novo.’” Wood v. Safeway Ins. Co., 114 So. 3d 714, 716 (Miss. 2013)
(quoting Laurel Ford Lincoln-Mercury, Inc. v. Blakeney, 81 So. 3d 1123, 1125 (Miss.
2012)).
caused the injury occurred.
3
“Dixie is a Mississippi corporation whose address in 400 Liberty Park, Drive,
Flowood, Mississippi, which is located in Rankin County, Mississippi.” “Defendant Central
Insurers of Grenada, Inc.[,] is a Mississippi corporation whose address is 639 West Monroe
Street, Grenada, Mississippi, which is located in Grenada County, Mississippi.”
4
DISCUSSION
¶8. The Mississippi venue statute provides four permissible venue options for “[c]ivil
actions of which the circuit court has original jurisdiction”: (1) “the county where the
defendant resides,” or (2) “if a corporation, [] the county of its principal place of business,”
or (3) “the county where a substantial alleged act or omission occurred” or (4) the county
“where a substantial event that caused the injury occurred.” Miss. Code Ann. §
11-11-3(1)(a)(i) (Rev. 2004). Greenwood maintains on interlocutory appeal that Warren
County is a proper venue under the statute because “a substantial alleged act or omission”
or a “substantial event that caused the injury occurred” there. Id.
¶9. “‘Of right, the plaintiff selects among the permissible venues, and his choice must be
sustained unless in the end there is no credible evidence supporting the factual basis for the
claim of venue.’” Hedgepeth v. Johnson, 975 So. 2d 235, 238 (Miss. 2008) (quoting Flight
Line, Inc. v. Tanksley, 608 So. 2d 1149, 1155 (Miss. 1992)). Greenwood is correct that the
dismantling of the building, which resulted in the lawsuit for which the insurers refused to
provide coverage, occurred in Warren County. Because Warren County is neither a “county
where the defendant resides” nor “the county of its principal place of business,” we must
consider whether Warren County is a “county where a substantial alleged act or omission
occurred or where a substantial event that caused the injury occurred.” Miss. Code Ann. §
11-11-3(1)(a)(i) (Rev. 2004) (emphasis added).
¶10. Mesa, Grenada, and Dixie argue that the statutory language “in the county where a
substantial alleged act or omission occurred or where a substantial event that caused the
5
injury occurred,” means, in the context of nonrenewal of insurance policies, “the relevant
actions of the insurance company . . . . associated with the company’s decision not to renew
the policy.” Holmes v. McMillan, 21 So. 3d 614, 619 (Miss. 2009) (citing Med. Assurance
Co. of Miss. v. Myers, 956 So. 2d 213, 218-19 (Miss. 2007)).
¶11. In Holmes, the plaintiff had been in an automobile accident “in the roundabout
intersection of International Drive and Old Brandon Road, at the entrance to the Jackson-
Evers International Airport.” Holmes, 21 So. 3d at 615. The plaintiff sued State Farm in
Hinds County for breach of contract, aggrieved by State Farm’s refusal to pay him a
satisfactory amount in uninsured motorist benefits. Id. at 616. State Farm sought a transfer
of venue. Id. The accident scene, although physically located in Rankin County, was under
the jurisdiction of the City of Jackson. Id. The trial court denied the change of venue and this
Court reversed, finding “no dispute that the location where the accident occurred, giving rise
to this suit, is physically in Rankin County.” Id. at 616, 618. Because the accident had
occurred in Rankin County and because “[n]othing in the record . . . suggests that the
rejection of the settlement demand was connected to Hinds County,” this Court held that
venue was not proper in Hinds County, but was proper in Rankin County. Id. at 619-20.
¶12. In a similar case, the Hedgepeths of Ocean Springs were denied coverage by State
Farm Fire and Casualty Insurance Company following Hurricane Katrina. Hedgepeth, 975
So. 2d at 236. The Reverend Hedgepeth had obtained a renter’s insurance policy for the
parsonage of the church he pastored; but, because the policy did not include a separate flood
insurance policy, the insurance claims on personal property lost to storm surge were denied.
6
Id. The Hedgepeths had requested flood insurance, but their insurance agent, who lived in
Madison County and kept an office in Hinds County, had informed them that such was not
available to renters. Id. The Hedgepeths filed suit in Jackson County, the trial court granted
State Farm’s motion to transfer venue to Madison County, and this Court granted an
interlocutory appeal to the Hedgepeths. Id. at 237.
¶13. This Court considered “whether either ‘a substantial alleged act or omission’ or ‘a
substantial event that caused injury’ occurred in Jackson County.” Id. at 239. Noting that the
Hedgepeths’ insurance agent had “urged them to commit insurance fraud,” this Court found
that the agent “was in Jackson County at the Hedgepeths’ home when she allegedly told Mrs.
Hedgepeth to list some of the property which had been destroyed on the first floor as having
been located on the second floor,” proposed conduct which the Hedgepeths averred had
“caused them mental anguish and emotional distress.” Id. at 240. Furthermore,
representatives of State Farm informed the Hedgepeths at their home in Jackson County that
their claims would be denied for lack of flood coverage. Id.
¶14. This Court sustained the Hedgepeths’ choice of venue and remanded the case to
Jackson County. Id. In support of that decision, this Court cited Myers,4 in which we had
held that because “[n]o ‘substantial event that caused injury’ to Dr. Myers occurred in
Holmes County,” Myers had to “show that a substantial alleged act or omission occurred
there.” Hedgepeth, 975 So. 2d at 239 (citing Myers, 956 So. 2d at 219). In distinguishing
4
In Myers, this Court held that Madison County, where the insurer’s decision not to
renew the policy occurred, was the proper venue because it was the insurer’s “decision not
to renew the insurance policy that is the alleged cause of [plaintiff’s] injuries.” Myers, 956
So. 2d at 219, 220.
7
Myers, we held that “[t]he Hedgepeths’ claims are based, at least in part, on actual losses
suffered due to Hurricane Katrina, as their complaint alleges the loss of thousands of dollars
in personal property as a result of the defendant’s failure to provide flood insurance.”
Hedgepeth, 975 So. 2d at 240 (emphasis added). The Court ultimately found that, “[b]ecause
‘substantial alleged acts,’ as well as a ‘substantial event that caused injury’ occurred in
Jackson County, Jackson County is a proper venue for this case.” Id.
¶15. As this Court recognized in Myers, Hedgepeth, and Holmes, the statutory language
allows for venue either in “the county where a substantial alleged act or omission occurred”
or in the county “where a substantial event that caused the injury occurred.” Miss. Code Ann.
§ 11-11-3(1)(a)(i). It is true, as Mesa, Grenada, and Dixie argue, that venue would be proper
in the present case in Rankin County, where Dixie is located, or in Grenada County, where
Central Insurers of Grenada, Inc., is located. But it is not true that our law prevents the
plaintiff from selecting Warren County, the county “where a substantial event that caused the
injury occurred.” In Hedgepeth, this Court found that the “substantial event that caused
injury” was Hurricane Katrina. Hedgepeth, 975 So. 2d at 240. In Holmes, this Court held
that the “substantial event that caused injury” was the automobile accident which had
occurred in Rankin County. Holmes, 21 So. 3d at 620.
¶16. Here, the building in which Greenwood owns an interest in salvage rights is situated
in Warren County. Greenwood’s dismantling of the building allegedly damaged the adjoining
landowners’ buildings in Warren County, which resulted in a lawsuit by the adjoining
landowners against Greenwood. It was that damage and the resultant lawsuit which, because
8
the insurance company refused to defend Greenwood, resulted in allegations of “actual losses
suffered.” Hedgepeth, 975 So. 2d at 240. Greenwood’s complaint alleges that “[a]fter
proceeding with the dismantling of the building, the adjoining building owners filed a claim
and a lawsuit.” When insurers denied the claim, “[a]s a result of Defendants[’] actions,
[Greenwood] became embroiled in the claim and ultimately the lawsuit without the benefit”
of indemnity coverage. The plaintiff further alleged loss of “valuable materials,” which
allegedly had been ruined “due to the exposure to the elements.” We hold that the
dismantling of the Vicksburg building and the resultant lawsuit constitutes “a substantial
event that caused injury” pursuant to Section 11-11-3(1)(a)(i). We hold that venue was proper
in Warren County, and that the trial court abused its discretion in limiting Greenwood’s
venue options to Rankin or Grenada Counties.
CONCLUSION
¶17. Venue is proper in Rankin or Grenada Counties. Venue also is proper in Warren
County because “a substantial event that caused injury,” Greenwood’s dismantling of a
building which allegedly damaged buildings of adjoining landowners, occurred in Warren
County. Greenwood has established adequately that Warren County is a proper venue, and
the plaintiff’s choice of permissible venue options controls. We therefore reverse the
judgment of the Circuit Court of the First Judicial District of Hinds County and remand the
case for transfer to the Circuit Court of Warren County.
¶18. REVERSED AND REMANDED.
WALLER, C.J., DICKINSON, P.J., LAMAR, PIERCE, KING AND
COLEMAN, JJ., CONCUR. RANDOLPH, P.J., NOT PARTICIPATING.
9