author: SMITH, Presiding Justice,

text:
    James S. THOMPSON, Mayor of City of McComb, et al. v. James J. ANDING et al.
    No. 51181.
    Supreme Court of Mississippi.
    May 9, 1979.
    Watkins & Eager, James L. Carroll, Jackson, Wiltshire & Walman, McComb, for appellants.
    Richard E. Stratton, III, Brookhaven, Mounger & Mounger, Tylertown, for appel-lees.
    Before SMITH, SUGG and COFER, JJ.
   SMITH, Presiding Justice,

for the Court:

This case involves an appeal by John S. Thompson, Mayor of the City of McComb, Mississippi, Herbert Wilmesherr, Baker Gunter, Jewell D. Conerly, Harvey Vest, Clyde Simmons and Cliff L. White, Selectmen and Constituting the Board of Selectmen of the City of McComb City, Mississippi, and Charles B. Campbell, Tax Collector for the City of McComb City, Mississippi, from a decree of the Chancery Court of Pike County overruling their general demurrer to an original bill filed by James J. Anding, W. W. Williamson, John H. Boyd, F. E. McKinley, George S. Carruth and E. D. Bearden, as citizens of Pike County who reside in “and/or” own real property within the McComb Municipal Separate School District but outside the corporate limits of McComb City, and asserting that complainants brought the suit as representatives of a class consisting of themselves and all others similarly situated, said decree also overruling a motion by the defendants to dismiss the bill as not stating a case meeting the essential requirements of a class action.

The bill charged that the lands of the so-called “class” were assessed at a value substantially higher than lands of taxpayers of Pike County generally and lands in other Pike County school districts and in school districts in other counties and were not assessed in proportion to their value. Demand was made for refund of taxes and a requirement that the lands be properly assessed.

It is apparent from the bill, and confirmed by the argument on appeal, that claimants’ suit is based upon the proposition that Mississippi Code Annotated section 21-33-11 (1972) provides the exclusive method for the assessment for school taxes of lands comprising that part of a municipal separate school district which lies outside municipal boundaries, and that the assessments appearing on the county assessment rolls are conclusive upon the municipal taxing authorities. The section reads as follows:

The municipal assessment of railroad property, and other property required by law to be assessed by the state railroad assessors, shall be made by the assessor by copying from the assessment roll of such property, filed with the clerk of the board of supervisors, the assessment of all the property situated inside the municipality. Where any municipality has added territory, the assessor shall likewise copy, from the roll filed with the clerk of the board of supervisors, the assessment of all the property situated within such added territory constituting, with a municipality, a separate school district. The assessment so copied shall be the legal assessment for the municipality, and the municipal separate school district, and, when certified by the clerk and placed in the hands of the municipal tax collector, shall be his warrant for the collection of municipal and separate school district ad valorem taxes.

If it can be said that there are certain ambiguities in Mississippi Code Annotated section 21-33-11 (1972) standing alone, when considered with other statutes dealing with the assessment of property, it becomes manifest that, insofar as the assessment of separate school district property lying outside a municipality, it must be construed as:

(1) Relating exclusively to the assessment of railroad property by the “State Railroad Assessors”, including that in a municipality or in the added territory of a separate school district; (2) or providing a temporary expedient or alternative method for assessing property added to a municipal separate school district which lies outside a municipality. While not a controlling authority, of course, Ross, in Municipal Taxation in Mississippi, 29 M.L.J. 41 (1957), the author states:

As stated, in 1950 the legislature rewrote the tax law as to municipal ad valo-rem taxes. All property within the municipality, real and personal, on the first of January of each year, is subject to assessment and ad valorem tax levies for that year. This law provides the form of assessment rolls, authorizing municipalities to follow the county rolls or to provide for separate assessment by the municipal assessor each year. The manner of assessing public utilities and public car companies is provided, and also the method of assessing motor vehicles.
The writer has had no experience with municipal assessments where the municipality follows the county assessment rolls. It appears that the great majority of municipalities employ the system wherein the municipal assessments are made by the municipal tax assessor each year. This discussion on municipal assessments concerns this procedure.
From Miss.Code Ann. §§ 3742-01 to -46 (1942) the procedure of municipal tax assessing is determined.
The municipal tax assessor assesses all taxable property within the boundaries of the municipality, and in the case of a municipal separate school district having added territory, within the boundaries of the added territory also. He shall complete the assessment both of the real and personal property, and file the assessment rolls, with the proper affidavit attached, with the municipal clerk on or before the first Monday of September, unless the governing authorities shall fix a different date.

Mississippi Code Annotated section 21-33-21 (1972) provides:

The assessor shall, in the same manner and at the same time as municipal assessments are made, make an assessment of all taxable property in any added territory, and make the same a part of the assessment roll of the municipal separate school district.

And Mississippi Code Annotated section 37-7-615 requires that:

. The taxable property of territory outside of the municipal limits which has been added to a municipal separate school district shall be assessed and taxes collected thereon for all school purposes in the same manner as the property within the municipality is assessed and taxes collected therefrom for school purposes,

This Court has held that statutes relating to the same subject matter, although appearing to be in conflict, should, so far as reasonably possible, be harmonized with each other so as to give force and effect to each. McCullen v. State, 217 Miss. 256, 63 So.2d 856 (1953), Aikerson v. State, 274 So.2d 124 (Miss.1973).

This Court has held consistently that when applying section 112 of the Mississippi Constitution, in considering the validity of assessments in a taxing district, such assessments are to be compared with other property assessments within the taxing district as a whole and not with assessments in other taxing districts. In Xerox Corporation v. City of Jackson, 328 So.2d 330 (Miss.1976), the rule was followed, the Court stating:

Section 112 of the Mississippi Constitution of 1890 as amended provides in part:
“Taxation shall be uniform and equal throughout the state. Property shall be taxed in proportion to its value. Property shall be assessed for taxes under general laws, and by uniform rules, and in proportion to its value.” Miss.Code Ann. (1972), Vol. 1.
We have construed this language to mean that assessments must be equal and uniform in the taxing district. McArdle’s Estate v. City of Jackson, 215 Miss. 571, 61 So.2d 400, 63 So.2d 101 (1952); Lavecchia v. Mayor and Aldermen of City of Vicksburg, 197 Miss. 860, 20 So.2d 831 (1945); Redmond v. City of Jackson, 143 Miss. 114, 108 So. 444 (1926). In this case the taxing district is the City of Jackson. (328 So.2d at 333-334).

It is apparent that an adoption of the rule for which appellees contend, that is, that property in the territory added to the municipal separate school district and lying outside the municipality, should be assessed differently than property lying within the municipality, would result in the very lack of uniformity and equality which the bill purports to seek and would be constitutionally impermissible.

The general demurrer to the bill should have been sustained.

Likewise, the motion to dismiss the suit as not presenting the essential prerequisites of a class action in Mississippi, should have been sustained.

In Barrett v. Coullet, 263 So.2d 764 (Miss.1972), this Court said:

59 Am.Jur.2d Parties, § 55, page 424, lists these two fundamental prerequisites of a representative or class suit:
“(1) there must be an ascertainable class, and (2) there must be a well-defined community of interest in the questions of law and fact involved affecting the parties to be represented.” (Emphasis added).
The textwriter immediately adds to these two indispensable requirements with this language:
“It also has been said that in order for one to bring an action for the benefit of himself and others there must be a community of interest plus a right of recovery based upon the same essential facts, and all those on whose behalf the suit is brought must have an interest common or identical with that of the named plaintiff.” (Emphasis added). Id. at 424-425. (263 So.2d at 766).

The language of the Court in Barrett finds some analogy here:

“[T]hat the unnamed ticket holders do not have a common interest or a community of interest, but rather that each individual ticket holder has a claim at law which is several and independent, and that the complainant, John W. Barrett, is not entitled to maintain this suit as a class action.” (263 So.2d at 765).

Obviously, Rule 23 of the Federal Rules of Civil Procedure dealing with class actions, has no application in this case.

Moreover, the class action, like any other suit in equity, must present a matter for equity cognizance. Tribette v. Illinois Central Railroad, 70 Miss. 182, 12 So. 32 (1892).

In Barrett v. Coullet, supra, this Court stated that in order to maintain a so-called class action that there must be:

(1) An ascertainable class.
(2) A well-defined community interest in questions of fact and law affecting the members of the class.
(3) A right of recovery based upon the same essential facts.

As early as Anderson v. Ingersoll, 62 Miss. 73 (1884) this Court dealt with a case involving an alleged excessive assessment of land. The Court stated:

If the appellee was aggrieved by the action of the board of supervisors in increasing the assessment of his property he should have appealed to the circuit court, as he was permitted to do by § 504 of the Code of 1880. The board had jurisdiction of the matter on which its action was taken, and any error committed in its exercise was correctible by appeal; the appellee, having failed to avail himself of the remedy provided by the statute, cannot invoke the aid of the chancery court. Johnson v. Bond, MS. opinion, Book L, 278. (62 Miss. at 74-75).

In citing Anderson, appellees point out that section 504, referred to above, is the predecessor of present section 11-51-77.

This Court has continued to hold that the remedy of a taxpayer under circumstances such as those disclosed by the bill of complaint in this case, is by exercising the statutory right of appeal. In Yazoo Delta Investment Company v. Suddoth, 70 Miss. 416, 12 So. 246 (1893), the Court said:

[A]nd, from its judgment (the order of the board approving the assessment) so rendered, the appellant, if dissatisfied, should have appealed. Having failed to do so, he is concluded by the roll as approved by the board. (70 Miss. at 423, 12 So. at 248).

In Alexander v. Mayor And Board of Aldermen of City of Natchez, et aL, 219 Miss. 78, 68 So.2d 434 (1953), certain taxpayers brought suit in the Chancery Court of Adams County against the Mayor and Board of Aldermen of the City of Natchez, challenging the validity of a contract between the City and a firm of expert property appraisers. The bill alleged “that the valuations made by the city assessor under this contract are in fact discriminatory and not equal and uniform, and are arbitrary in amounts.” In disposing of the case this Court said:

However, if appellants were aggrieved as to the assessments affecting their property interests, they should have filed objections with the Mayor and Board of Aider-men and have taken appeals from such assessments in the manner provided by statute. Miss.Code 1942, §§ 3716-3721, amended in 1950 by Code Sections 3742-12 through 3742-17, and Code Section 1196 deal with appeals from general ad valorem tax assessments. . . . (219

Miss, at 92, 68 So.2d at 440).

The claims of the individuals said to comprise the “class” in each case relate to an individually owned parcel of real estate and are separate and distinct, each from the other. The remedy of each of these persons, as landowners, was by appeal under the provisions of section 21-33-39 and section 11-51-77, supra. This Court has continued to recognize the validity of this provision and that the statutory method of appeal provides each of the individuals concerned with a separate, plain and adequate remedy at law. That being so, a court of equity is without jurisdiction.

Under ordinary circumstances, a decree sustaining the demurrer would be entered here, with a remand to afford complainants a reasonable time to amend. However, in view of our conclusion that (1) the bill does not state a case for a class action, and (2) complainants had a plain, adequate remedy at law and thus equity was without jurisdiction, the motion to dismiss the bill should have been sustained. A decree, therefore, is entered here finally dismissing the bill.

REVERSED AND DECREE HERE DISMISSING BILL.

PATTERSON, C. J., ROBERTSON, P. J., and SUGG, WALKER, BROOM, LEE, BOWLING and COFER, JJ., concur.

      . Miss.Code Ann. §§ 3742-01 to -46 (1942).

      . Miss.Code Ann. §§ 3742-04, -05 (1942).

      . Miss.Code Ann. §§ 9352-65, -66 (1942).


source: Caselaw Access Project

author: PATTERSON, Chief Justice,

license: Public Domain

text:
    CITY OF KOSCIUSKO, Mississippi and Kosciusko Light & Water Commission, Defendants-Appellants, v. MISSISSIPPI POWER & LIGHT COMPANY, Complainant-Appellee.
    No. 51094.
    Supreme Court of Mississippi.
    May 9, 1979.
    John D. Guyton, Kosciusko, for defendants-appellants.
    Wise, Carter, Child, Steen & Caraway, James K. Child, Jr., Jackson, for complainant-appellee.
    Before PATTERSON, BROOM and BOWLING, JJ.
   PATTERSON, Chief Justice,

for the Court:

This is an appeal from the Chancery Court of Attala County which court enjoined the City of Kosciusko and the Kosciusko Light & Water Commission from extending electric service into newly-annexed areas of the city.

The Kosciusko Light & Water Commission was created in 1947 by order of the city’s mayor and board of aldermen. Until 1951 the commission generated its own power; during that year it commenced purchasing power from Mississippi Power & Light Company, hereinafter MP&L, but controlling the distribution.

During the legislative session of 1956 the Public Utilities Act of 1956, now found in its amended form at Mississippi Code Annotated section 77-3-1, et seq. (1972), was enacted. It organized the previously relatively uncontrolled utilities and created the Mississippi Public Service Commission to govern and issue certificates of necessity and convenience. Municipally owned utilities were specifically exempt from this certification.

On May 12, 1959, before MP&L applied for the necessary certification in the questioned area, an agreement was entered into with the City of Kosciusko providing:

Neither party shall distribute or furnish electric energy to anyone who at the time of the proposed service is receiving electric service from the other; provided, however, that customers shall have the right to serve any customer of company located inside the corporate limits as they now exist or may hereafter be extended by compensating company for its local facilities used to serve such customer. Specific consent is hereby given by customer to company to continue to serve Superior Coach Corporation’s plant including the right and privilege of constructing, maintaining, and operating electric facilities necessary thereto along such streets, alleys, ways, bridges, and public places as required.

MP&L then obtained an interim and partial certificate on' November 29, 1959, from the Public Service Commission. This certification did not extend within the then corporate limits of Kosciusko except for the Superior Coach Corporation, MP & L’s longtime customer. In 1966 the City of Kosciusko annexed a considerable area, including the future site of Forest Hills Subdivision and Pasquale’s Restaurant which service areas are the subject of this suit.

In 1968 the Public Service Commission made final MP & L’s earlier certificate of public convenience and necessity. In 1970 MP & L and Kosciusko entered into an agreement continuing the same boundary clause as in 1956. In 1974 another agreement was entered, with the following substituted for the earlier clause:

It is mutually agreed that each party to this agreement shall retain and continue to render service to the customers and service locations to which the parties’ facilities were connected on April 2, 1974.

In 1976 the Kosciusko Light & Water Commission began establishing its distribution services in the Forest Hills Subdivision. MP & L commenced an action to enjoin that expansion, and later added the area of Pasquale’s Restaurant by amendment. Hearing was first had in the Chancery Court of Attala County on March 30, 1976, and thereafter a special chancellor was appointed. A long process of adjudication culminated in an order of November 4, 1977, which permanently enjoined the city from extending services beyond the municipal boundaries of November 25, 1959. The underlying rationale was that the certification of November 25, 1959, created a property right in MP & L which is immune to encroachment by annexation.

The central issue of this appeal is the propriety of restricting Kosciusko’s municipally-owned utility service to the municipal limits of 1959. The city and its alter ego utility assert certification of MP & L by the Mississippi Public Service Commission cannot obstruct their expansion because municipalities are exempt from the necessity of certification and regulation. Miss.Code Ann. § 77-3-1 (1972). Therefore, the city suggests the agreement of May 12, 1959, because of the exemption must be construed in its favor, thereby allowing expansion.

We agree that a city needs no certification and rate regulation beyond the price structure of economics. See Mississippi Power Co. v. East Mississippi Electric Power Ass’n, 244 Miss. 40, 140 So.2d 286 (1962). However, price and area are different. We cannot agree that Section 77-3-1 permits an exempt municipal utility to intrude into a regulated utility’s certified area. Two reasons are persuasive. First, the idea that a municipally-owned utility may extend its services wherever and whenever it desires, overlapping with other power sources, would make a shambles of the orderly and regulated scheme of utility service ordained by our legislature in the Public Utilities Act. Capital Electric Power Ass'n v. Mississippi Power & Light Co., 240 Miss. 139, 125 So.2d 739 (1961). The second is that on the day of certification MP & L was granted a property right to service the disputed area outside Kosciusko. In Capital Electric Power Ass’n. v. City of Canton, 274 So.2d 665 (Miss.1973), we stated:

The issue in this case is simply whether or not the certificate of public convenience and necessity issued to the complainant, Capital Electric Power Association, gave it the exclusive right and obligation to furnish electricity to the users of electricity within the area specified in the certificate. The chancellor held that the certificate granted to appellant was not exclusive and that both the appellant and defendants had a right to furnish electrical energy to Canton Academy, Inc. We hold, however, that the certificate of public convenience and necessity issued to the complainant, Capital Electric Power Association, under the so-called “Grandfather Clause” (Section 7716-05(b), Mississippi Code 1942 Annotated [1956]), gave it the exclusive right to furnish electric energy to patrons within the area designated in the certificate.
(274 So.2d at 667)

On November 25, 1959, MP & L received its certification covering the controverted area. Since that day it has held both a right to sell its product there, and an obligation to provide adequate services. Only failure to fulfill its obligation can endanger this right. Delta Electric Power Ass’n. v. Mississippi Power & Light Co., 250 Miss. 482, 149 So.2d 504 (1963).

The second issue before this Court is whether or not the Kosciusko Light & Water Commission in 1959 received notice of certification. Appellants assert if no notice was received, certification would not be binding upon them for lack of process. The record reveals the City of Kosciusko did receive notice of MP & L’s certification by certified mail which complied with the “reasonable notice” of the statute. This is specifically reflected in the November 25,1959, order granting an interim and partial certificate of convenience to which appellants refer with frequency. Notice to the city was sufficient to notify the city’s alter ego, the light and water commission, in our opinion.

Appellants next assert the trial court unduly restricted their efforts to introduce evidence concerning their servicing a portion of the area now in dispute prior to the city expansion. We think it sufficient to state that we have examined the voluminous record and conclude the trial court was correct in not permitting this testimony into evidence because the Grandfather Certificate of MP & L had previously been obtained, giving it the exclusive right to the area. We therefore think the excluded evidence was not material to the present issue.

We find before us a case produced by the concurrent trends of municipal expansion and certified regulated utilities, a conflict not unknown to this Court. Indeed, we are of the opinion Capital Electric Power Ass’n v. City of Canton, supra, controls its central issue and therefore, the judgment of the trial court must be affirmed.

AFFIRMED.

SMITH and ROBERTSON, P. JJ., and SUGG, WALKER, BROOM, LEE, BOWLING and COFER, JJ., concur.


author: COFER, Justice,

text:
    SUBSCRIBERS CASUALTY RECIPROCAL EXCHANGE v. Salvadora J. TOTARO.
    No. 51166.
    Supreme Court of Mississippi.
    May 16, 1979.
    Bryant & Stennis, Rae Bryant, Gulfport, for appellant.
    Harold J. DeMetz, Gulfport, for appellee.
    Before PATTERSON, C. J., and SUGG and COFER, JJ.
   COFER, Justice,

for the Court:

Appellee-cross appellant Salvadore J. To-taro was insured by appellant-cross appellee Subscribers Casualty Reciprocal Exchange, by a policy of insurance that promised to pay to Totaro, among other benefits, $50 per week for total disability for a maximum of 200 weeks. Other undertakings in the policy were fulfilled with promptness on appellant’s part, but hesitancy to pay the total disability provision of the policy caused Totaro to bring this suit for specific performance, plus other relief presently to be mentioned.

The Chancery Court of the First Judicial District of Harrison County entered decree in favor of Totaro on the disability clause of the policy for the period of July 22, 1977, date of the commencement of his accident and injury, through February 10, 1978. It also found the delay on the appellant company’s part to be of such inexcusable quality as to warrant allowance of punitive damages and attorney fees in the respective amounts of $10,000 and $1,500, the amounts prayed in Totaro’s bill of complaint.

The company appealed to the Supreme Court assigning errors addressed to the allowance of the punitive damages and the attorney fees. Totaro took a cross appeal asserting error in limiting his recovery of disability benefits to the period ending February 10, 1978.

Punitive damages and attorney fees in conjunction therewith are not allowed in chancery court, in the absence of a statute authorizing the imposition thereof. Wilborn v. Balfour, 218 Miss. 791, 806, 67 So.2d 857, 864 (1953); Monsanto Company v. Cochran, 254 Miss. 399, 180 So.2d 624, 626 (1965); Avant v Whitten, 253 So.2d 394, 396 (Miss.1971); Carl v. Craft, 258 So.2d 237, 241 (Miss.1972); and Gulf Steamship Companies v. Polk, 370 So.2d 1348 (Miss. 1979). By choosing the chancery court for his forum, Totaro forewent whatever right he had as to punitive damages and attorney fe6S

The cause must, therefore, be reversed and rendered on the direct appeal.

On Totaro’s cross appeal, he was entitled to recover up to 200 weeks, or for such part thereof during which he was totally disabled. The policy provision as to what constitutes total disability during the first fifty-two weeks from its commencement (the end of which was substantially after February 10, 1978), is:

Any disability during the period of fifty-two weeks from its commencement shall be deemed total disability only if it shall continuously prevent the insured from performing every duty pertaining to his occupation.

The chancellor’s allowance of recovery to February 10, 1978, is based in part on the testimony of Totaro’s own physician, that Totaro could perform all reasonable activities except walking in rough terrain since February 10, 1978, when Totaro’s disability to perform productive work ended. The chancellor’s decision is supported by substantial evidence, and is affirmed.

REVERSED AND RENDERED ON DIRECT APPEAL; AFFIRMED ON CROSS APPEAL.

PATTERSON, C. J., ROBERTSON, P. J., and SUGG, WALKER, BROOM, LEE, and BOWLING, JJ., concur.

SMITH, P. J., took no part.


author: LEE, Justice,

text:
    BECO, INC. v AMERICAN FIDELITY FIRE INSURANCE COMPANY.
    No. 50947.
    Supreme Court of Mississippi.
    May 16, 1979.

      Willard L. Mcllwain, Jr., Mcllwain & Cox, Greenville, for appellant.
    Butler, Snow, O’Mara, Stevens & Canna-da, Christy D. Jones, Thomas W. Prewitt, Jackson, for appellee.
    Before SMITH, ROBERTSON and LEE, JJ.
   LEE, Justice,

for the Court:

Beco, Inc. filed suit against American Fidelity Fire Insurance Company for eight thousand five hundred fifty-five dollars three cents ($8,555.03) on a performance bond in the Circuit Court of Washington County. The parties waived jury trial and, at the conclusion of the plaintiff’s case, the trial judge sustained a motion of American Fidelity Fire Insurance Company for directed verdict, and Beco, Inc. has appealed here.

The trial judge gave as reasons for sustaining the motion for directed verdict that (1) Beco, Inc. dealt exclusively with Wolfe Electric Company, Inc. and not with Bob Wolfe Electric Company, the principal under the bond, and Beco, Inc. was precluded from seeking relief under the bond; and (2) Beco, Inc. failed to establish that the materials in issue were actually incorporated into the Bank of Indianola. We conclude that the judge erred in granting the motion for directed verdict and we reverse and remand for a new trial.

The declaration charged that on or about September 18, 1975, Bob Wolfe d/b/a Bob Wolfe Electric Company entered into a contract with Bank Building & Equipment Corporation of America to perform certain electrical work on the Bank of Indianola building; that on said date Bob Wolfe Electric Company, by B. J. Wolfe, Sr., as principal, and American Fidelity Fire Insurance Company, as surety, executed a performance bond in the sum of forty thousand two hundred forty-five dollars twenty-four cents ($40,245.24) with Bank Building & Equipment Corporation of America, as obli-gee, for the performance of an electrical contract in the construction of the said Bank of Indianola building; that Beco, Inc. supplied electrical materials for the Bob Wolfe Electric Company, which were used on the Bank of Indianola construction job and that the sum of $8,555.03 was not paid and was owing; and that American Fidelity Fire Insurance Company is liable to Beco, Inc. by virtue of the obligations under the said performance bond. The answer admitted that Beco, Inc. supplied electrical materials to Wolfe Electric Company used in the Bank of Indianola project, but denied that any money was due and owing to Beco, Inc. for materials supplied to the said job.

The evidence indicates that B. J. Wolfe, Sr., who is also known as Bob Wolfe, is an electrical contractor and that he operates under the individual name of Bob Wolfe Electric Company and under the corporate name of Wolfe Electrical Company, Inc. Mr. Wolfe and his business operators have the same post office address and operate from the same building located on Highway 82, Greenville, Mississippi.

On September 18, 1975, B. J. Wolfe, Sr., as principal, executed a performance bond [Appendix I] under the name Bob Wolfe Electric Company, by B. J. Wolfe, Sr., and appellee executed the bond as surety. The bond recited that Bob Wolfe Electric Company had entered into a written agreement with Bank Building & Equipment Corporation of America, the obligee, to perform the electrical work (labor and materials) for Bank of Indianola building, in accordance with certain drawings and specifications. The amount of the contract and bond was $40,245.24 and Wolfe was bound for the performance of said contract.

Numerous invoices for electrical supplies were exhibited to the declaration, and were introduced in evidence. They show that the supplies were sold to Wolfe Electric, P. 0. Box 306, Greenville, Mississippi, and many of them reflect that the materials were shipped to Indianola Bank, Indianola, Mississippi. Mr. Charles H. Steed, salesman for appellant, testified that the invoices are for materials that Beeo, Inc. shipped to the Indianola Bank as called for in the specifications. He further testified that he had seen (the) electrical materials installed in the Bank of Indianola building. Appellant introduced in evidence a check from Bob Wolfe Electric Company payable to Beco, Inc. in the amount of forty-three hundred twenty-nine dollars thirty-two cents ($4,329.32), a part of which was for the Bank of Indianola job. On February 10, 1977, Bank Building & Equipment Corporation of America, obligee under the performance bond, gave notice of final settlement [Appendix II] of the contract on which Bob Wolfe Electric Company of Greenville, Mississippi (Bob Wolfe) performed the bank building contract.

On October 14, 1977, appellant filed a request for admissions which was served upon appellee. On November 16, 1977, Bob J. Wolfe and Lucille Wolfe, without benefit of counsel, filed an instrument designated “Petition for Intervenor” wherein it was stated that they had the information with which to answer the request for admissions, and they answered five interrogatories propounded to the defendant in said request for admissions.

(1)They denied that Beeo, Inc. supplied electrical materials for use by Bob Wolfe Electric Company on the Bank of Indianola job.

(2) They stated that Bob Wolfe Electric Company has never purchased materials from Beco, Inc. or had an account at any time with Beco, Inc.; that Bob Wolfe Electric Company did not perform the contract on the Bank of Indianola job and did not furnish labor or materials in the performance of such contract.

(3) They admitted that the performance bond attached to the declaration entered into by Bob Wolfe Electric Company for work on the Bank of Indianola job was a true and correct copy of the original.

Although appellee did not introduce any evidence, its defense appears to be that Bob Wolfe Electric Company (Bob Wolfe) did not perform the contract, did not do any work on the Indianola Bank building, and did not purchase materials from Beco, Inc. Such a position is indeed strange when the performance bond recites that Bob Wolfe Electric Company (Bob Wolfe) had entered into a written contract for the electrical work on the Indianola Bank building; the building was completed and the electrical work was performed; Beco, Inc. supplied the electrical material for the job; and Bank Building & Equipment Corporation of America, obligee, gave notice of final settlement that the contract had been performed by Bob Wolfe Electric Company (Bob Wolfe). There emerges from the evidence and inferences the inescapable conclusion that B. (Bob) J. Wolfe, Sr. (only signature on bond) was the real actor, whether as an individual or by his family corporation. It is difficult to see how appellee was misled or prejudiced by what transpired, in dealing with Mr. Wolfe.

Mississippi Code Annotated Section 85-7-185 (1972) provides as follows:

“When any contractor or subcontractor entering into a formal contract with any person, firm or corporation, for the construction of any building or work or the doing of any repairs, shall enter into a bond with such person, firm or corporation guaranteeing the faithful performance of such contract and containing such provisions and penalties as the parties thereto may insert therein, such bond shall also be subject to the additional obligations that such contractor or subcontractor, shall promptly make payments to all persons furnishing labor or material under said contract; and in the event such bond does not contain any such provisions for the payment of the claims of persons furnishing labor or material under said contract, such bond shall nevertheless inure to the benefit of such person furnishing labor or material under said contract, the same as if such stipulation had been incorporated in said bond, and any such person who has furnished labor or materials used therein; for which payment has not been made, shall have the right to intervene and be made a party to any action instituted on such bond, and to have his rights adjudicated in such action and judgment rendered thereon, subject, however, to the priority of the rights or claim for damages or otherwise, of the obligee. The bond herein provided for may be made by any surety company authorized to do business in the State of Mississippi.”

Appellee contends that the above section does not cover appellant under the case of Alabama Marble v. United States Fidelity & Guaranty Co., 146 Miss. 414, 111 So. 573 (1927). We distinguish that case from the present case and hold that the statute applies here. Although Wolfe was engaged in corporate and individual operations, the following general principle is significant:

“[According to a number of cases, the notion of separate corporate existence of parent and subsidiary or affiliated corporations will not be recognized where one corporation is so organized and controlled and its business conducted in such a manner as to make it merely an agency, instrumentality, adjunct, or alter ego of another corporation. The fiction of separate corporate identity of two corporations will not be extended to permit one of the corporations to evade its just obligations or to promote fraud or illegality or injustice.” 18 Am.Jur.2d Corporations § 17, at 565-566 (1965).

See Highway Development Co., Inc. v. Mississippi State Highway Commission, 343 So.2d 477 (Miss.1977); Johnson & Higgins of Miss., Inc. v. Commissioner of Insurance of State of Mississippi, 321 So.2d 281 (Miss.1975); Hernando Bank v. Bryant Electric Co., Inc., 357 F.Supp. 575 (N.D.Miss.1973); and Houston Oil Field Material Company v. Stuard, 406 F.2d 1052 (5th Cir. 1969).

The evidence and inferences flowing therefrom established a prima facie case for the appellant. Had the appellee rested without introducing evidence, the appellant would have been entitled to recover the amount sued for. Paymaster Oil Mill Co. v. Mitchell, 319 So.2d 652 (Miss.1975). The trial judge erred in sustaining the motion for a directed verdict in favor of appellee. The judgment of the lower court is reversed and the cause is remanded for a new trial.

Appellant assigned as error the court’s action in sustaining the objection to questions dealing with invoice billing of the different companies. That evidence is relevant to the questions involved and should be admitted on the new trial.

This case was considered by a conference of the justices en banc.

REVERSED AND REMANDED.

PATTERSON, C. J., and SMITH and ROBERTSON, P. JJ., SUGG, WALKER, BROOM, BOWLING and COFER, JJ., concur.

APPENDIX I

AMERICAN FIDELITY FIRE INSURANCE COMPANY

Westbury, New York

BOND NO. 2042984

PERFORMANCE BOND

KNOW ALL MEN BY THESE PRESENTS THAT Bob Wolfe Electric Co. . as Principal, hereinafter called Contractor, and AMERICAN FIDELITY FIRE INSURANCE COMPANY, a company duly created and existing under the laws of the State of New York, as Surety, having its principal office in Westbury, New York, hereinafter called Surety, are held and firmly bound unto Bank Building & Equipment Corp. of America . as Obligee, hereinafter called Owner, in the amount of Forty Thousand Two Hundred Forty Five and 24/100 DOLLARS ($40.245.241. for the payment whereof Contractor and Surety bind themselves, their heirs, executors, administrators, successors and assigns, jointly and severally firmly by these presents.

WHEREAS, Contractor has by written agreement dated 5/21/75 entered into a contract with Owner for the labor and materials for electrical contract for Bank of Indianola. Miss, in accordance with drawings and specifications prepared by Jack A. Jones. Jr. . which contract is by reference made a part hereof and is hereinafter referred to as the Contract.

NOW THEREFORE, THE CONDITION OF THIS OBLIGATION IS SUCH THAT, if Contractor shall promptly and faithfully perform said contract, then this obligation shall be null and void; otherwise, it shall remain in full force and effect.

Whenever Contractor shall be, and declared by Owner to be in default under the Contract, the Owner having performed Owner’s obligation thereunder, the Surety may promptly remedy the default, or shall promptly:

(1) Complete the Contract in accordance with its terms and conditions, or
(2) Obtain a bid or bids for submission to Owner for completing the contract in accordance with its terms and conditions, and upon determination by Owner and Surety of the lowest responsible bidder, arrange for a contract between such bidder and owner, and make available as work progresses (even though there should be a default or succession of defaults under the contract or contracts of completion arranged under this paragraph), sufficient funds to pay the cost of completion, less the balance of the contract price, but not exceeding, including other costs and damages for which the Surety may be liable thereunder the amount set forth in the first paragraph hereof. The term balance of the contract price as used in this paragraph shall mean the total amount payable by Owner to Contractor under the contract and any amendments thereto less the amount properly paid by Owner to Contractor.

Any suit under this bond must be instituted before the expiration of two (2) years from the date on which final payment under the contract falls due.

No right of action shall accrue on this bond to or for the use of any person or corporation other than the Owner named herein, or the heirs, executors, administrators or successors of Owner.

Signed and sealed this 18th day of September of 1975.

Bob Wolfe Electric Co.
By: B. J. Wolfe,. Sr.
/s/ B. J. WOLFE. SR.
Principal
1512 Highway 82 East
Greenville, Miss.
Business Address

Countersigned:

AMERICAN FIDELITY FIRE INSURANCE COMPANY
/s/ SAM H. LESS
Sam H. Less Attorney in-fact

APPENDIX II

NOTICE TO ALL INTERESTED PARTIES:

Pursuant to Mississippi Code Annotated 85-7-189 (1972), Bank Building and Equipment Corporation of America (“Bank Building”), obligee under American Fidelity Fire Insurance Company Bond No. 2042984 on which Bob Wolfe Electric Company of Greenville, Mississippi (“Bob Wolfe”) is principal, gives notice that final settlement of the contract performed for Bank Building by Bob Wolfe on the Bank of Indianola, in Indianola, Mississippi, a Branch of the Planters Bank and Truste Company, has been made.

Bank Building and Equipment Corporation of America

William L. Smith, Esq. Vrunini, Grantham, Grower & Hewes 1440 First National Bank Building Jackson, Mississippi 39205 601-948-3101


author: SUGG, Justice,

text:
    GULF STEAMSHIP COMPANIES-INTERNATIONAL LONGSHOREMEN’S ASSOCIATION (GSC-ILA) PENSION PLAN AND AGREEMENT AND DECLARATION OF TRUST, and Thomas S. Millette, Administrator, v. Dewayne POLK.
    No. 51028.
    Supreme Court of Mississippi.
    May 16, 1979.
    Mize, Thompson & Blass, Henry F. Laird, Jr., John C. Ellis, Gulfport, for appellant.
    Reid & Associates, Floyd G. Hewitt, Jr., Biloxi, for appellee.
   SUGG, Justice,

for the Court:

Under the terms of a collective bargaining agreement effective October 1, 1956, certain employers and two local unions of the International Longshoremen’s Association agreed, among other things, to institute a pension plan and trust for the benefit of the employees covered under the collective bargaining agreements.

In 1958 the GSC-ILA Pension Plan and Trust (hereafter Plan) was created pursuant to the terms of the collective bargaining agreement. The Plan is operated by a Board of Trustees and is financed by employer contributions which are held by the Board in accordance with the powers and duties set forth in the Plan.

While covered under the Plan, Dewayne Polk was injured in an industrial accident on November 26, 1968. Based on his 1968 injury, on December 20, 1973, the Appeals Council of the Social Security Administration retroactively awarded Polk a total and permanent disability rating. Polk was also awarded $46,600 Workmen’s Compensation benefits based on his disability resulting from the 1968 injury.

Polk filed applications for a disability pension on May 26, 1971 and another on April 24, 1975. After Polk filed his second application, the Board discussed and considered his application on numerous occasions. The minutes of the Board reflect that, from May 20, 1975 until March 31, 1977, Polk’s application was discussed by the Board fourteen times but the Board neither denied nor approved his application.

During this time Polk was represented by different attorneys and lengthy correspondence was carried on between Polk’s attorneys and the attorneys for the Board. On October 1, 1975, the attorney for the Board requested Polk’s attorney to furnish proof of the year or years that Polk received Workmen’s Compensation benefits in order for the Board to make an adequate and final determination relative to Polk’s application. The information was furnished by Polk’s attorney by letter dated October 20, 1975.

On May 21, 1976 the attorney for the Board wrote Polk’s attorney that he would recommend to the Board that Polk was not eligible for pension benefits because Polk had less than 15 years service and because Polk had returned to work during the years 1970-71 and 1972-73. During the interim, Polk changed attorneys and his new attorney filed a bill for specific performance on April 26, 1977, against the Administrator and the Board. Polk sought recovery of $11,200 benefits accrued to April 1, 1977, and for $175 monthly disability benefits after April 1, 1977. Polk also sought attorneys’ fees in the amount of 40% of the benefits. The Administrator and Board answered and raised the affirmative defenses that Polk did not meet the 15 year qualification, and that he had returned to his employment.

The chancery court awarded Polk $11,200 benefits accrued to April 1,1977, and directed the Board to pay $175 for each additional month thereafter, together with 40% attorneys’ fees and interest from the date of the decree. The Administrator and Board appealed and assign as error: (1) Polk was not permanently and totally disabled, (2) Polk was not qualified under the express terms of the Plan for a disability pension, and (3) Polk was not entitled to recover attorneys’ fees.

PART I

The trustees of the Plan first contended that the evidence did not show that Polk was permanently and totally disabled.

Article 5, sections 3 and 4 of the Pension Plan provide:

Section 3. In any case where disability or sickness or injury, whether incurred on or off the job, may affect any employee’s right to a pension, such disability, sickness, or injury must be substantiated to the satisfaction of the Board. In the event of disagreement by the Board, a competent physician or physicians, appointed by the Board, shall make final determination with respect to such disability, sickness, or injury. The employee, upon request of the Board, must submit to an examination by any physicians selected by the Board, which shall pay for the cost thereof and any expenses incident thereto. A former employee receiving a pension due to disability under this Plan, must, upon request of the Board, submit to an examination to determine whether he is eligible for continuance of such pension. If any employee or former employee shall refuse to submit to any examination properly requested hereunder, he shall not receive or continue to receive a pension due to disability, or shall not be deemed to have suffered sickness or injury, whichever the case may be.
Section 4. In lieu of Section 3 above, the Trustees shall have the right to rely on the determination of the Social Security Administration for the definition of “total and permanent disability.” (Emphasis supplied).

After Polk’s first application was filed, he presented his first social security disability check dated January 3, 1974, to establish that he was rated totally and permanently disabled by the Social Security Administration.

Section 4 provides that, in lieu of the requirements of Section 3 the Board may rely on the determination by the Social Security Administration. In this case, the Board did not select a physician, did not request Polk to submit to an examination by a physician selected by it; therefore, we conclude that it elected to rely on the determination of the Social Security Administration as authorized by Section 4.

The evidence showed that Polk had received a total and permanent disability rating from the Social Security Administration, and in addition, the answer of defendants admitted this fact. Further, the Board did not show that it had requested Polk to submit to an examination of a physician selected by the Board. We therefore conclude that the court was correct in finding that Polk was totally and permanently disabled.

PART II

The first affirmative defense relied on by the Board was that Polk had not been employed in the industry a minimum of 15 years as required by the Plan. This defense is not well taken because the 15 year requirement was not adopted until 1973 and applied only to employees injured on or after October 1, 1972. At the time Polk was injured in 1968 an employee who had been employed in the industry for a period of not less than 10 years, who had worked an average of not less than 300 hours per year, and who became permanently and totally disabled qualified for disability payments. Polk met these requirements so we affirm the chancellor’s holding that Polk met the length of service requirements of the Plan.

The second affirmative defense is based on Article 7, Section 2 which follows:

The pension of any pensioner, other than a pensioner receiving a pension due to total and permanent disability, shall cease as of the date of hire if the pensioner is reemployed in the industry, and shall resume the first of the month following his reestablishment of eligibility in accordance with the provisions of the Plan. In the case of a pensioner receiving a pension due to disability, if he is found to be no longer disabled, or if he engages in gainful employment, other than for purposes of rehabilitation on a nominal wage basis, his pension due to disability shall cease.

Polk returned to his employment during the contract year October 1, 1970 to September 30,1971, and worked a total of 17.75 hours in the twelve-month period. This work was performed after the first operation on his back and before the second operation on his back. Polk said he returned to work during this period because his doctor told him he was able to work. Polk also returned to work during the contract year October 1,1972 to September 30, 1973, and worked a total of 282.50 hours. Polk’s reason for returning to work during this later period was that he had no income and his family needed support. He testified that he worked in pain all during this period and his fellow employees covered for him during this period of time.

Polk’s first application had not been approved during this second period of work and he was not drawing any disability pension from the Plan, neither had he received his total and permanent disability rating from the Social Security Administration.

In our opinion the quoted section does not bar Polk from recovering on his disability incurred in 1968; however, if his total and permanent disability ceases, the Board may terminate the disability pension under the provisions of Section 2 which provides that if a pensioner is found to be no longer disabled, or if he engages in gainful employment, other than for purposes of rehabilitation on a nominal wage basis, his pension due to disability shall cease. We therefore conclude the chancellor properly held that Polk was not barred from receiving his disability pension under the quoted section.

PART III

The Board also contends that the court erred by allowing an attorney’s fee to Polk. Polk contends that the allowance of attorneys’ fees was proper under the principles announced in Standard Life Insurance Co. of Indiana v. Veal, 354 So.2d 239 (Miss.1978). Veal has no application because Veal was a suit in circuit court for punitive damages which were awarded and the award was affirmed by this Court. This is a suit in chancery and ordinarily punitive damages may not be awarded in a suit in chancery. Carl v. Craft, 258 So.2d 237 (Miss.1972); Monsanto Company v. Cochran, 254 Miss. 399, 180 So.2d 624 (1965).

Polk also contends that he was entitled to an attorney’s fee under the provisions of the Employee Retirement Income Security Act (ERISA) enacted by Congress in 1974. 29 U.S.C.A. Sections 1001, et seq. Section 1132(a)(1)(B) authorizes a civil action by a participant or beneficiary to recover benefits under the terms of this Plan. Both state courts of competent jurisdiction and district courts of the United States have concurrent jurisdiction of such action under Section 1132(e)(1). Attorneys’ fees may be allowed in the discretion of the court under Section 1132(g).

Section 1144(a), (b)(1) provides that the subsection, of which Section 1132 is a part, shall not apply with respect to any cause of action which arose before January 1, 1975. Polk’s cause of action arose before the effective date of the act; therefore, the provision authorizing allowance of an attorney’s fee does not apply in this case.

CONCLUSION

We affirm the allowance of disability benefits, but reverse the allowance of attorneys’ fees.

AFFIRMED IN PART, REVERSED IN PART AND RENDERED.

All Justices concur.

      . The decree directing the Board to pay future monthly benefits was not questioned and is therefore not before the Court for consideration. National Old Line Insurance Co. v. Brownlee, 349 So.2d 513 (Miss.1977).


text:
    NATIONAL SECURITY FIRE & CASUALTY COMPANY v. MID-STATE HOMES, INC.
    No. 51056.
    Supreme Court of Mississippi.
    May 16, 1979.

      Watkins & Eager, Thomas M. Murphree, Jr., Jackson, for appellant.
    Guy, Dowdy & Whittington, Ronald L. Whittington, McComb, for appellee.
    Before ROBERTSON, SUGG and COF-ER, JJ.
   SUGG, Justice,

for the Court:

On May 15, 1973, National Security Fire & Casualty Company issued a fire insurance policy in the amount of $7,000 to Autrey Hardin which included a mortgagee clause in favor of Mid-State Homes, Inc. The policy was delivered to Mid-State and retained by it in its files. The first annual premium of $107.50 was paid but the renewal premium due May 16, 1974 was not paid. In December, 1974 the insured dwelling burned and Mid-State demanded payment of $4,030.75 from National Security, the amount of its mortgage. Payment was denied, and following a jury trial, Mid-State obtained judgment against National Security for $4,030.75 plus attorneys’ fees in the amount of $1,007.68.

National Security contends that the policy lapsed by its own terms because the premium due on May 16,1974 was not paid. The resolution of this contention requires consideration of section 83-13-9 Mississippi Code Annotated (1972) which follows:

Each fire insurance policy on buildings taken out by a mortgagor or grantor in a deed of trust shall have attached or shall contain substantially the following mortgagee clause, viz:
Loss or damage, if any, under this policy, shall be payable to (here insert the name of the party), as ___ mortgagee (or trustee), as _ interest may appear, and this insurance, as to the interest of the mortgagee (or trustee) only therein, shall not be invalidated by any act or neglect of the mortgagor or owner of the within described property, nor by any foreclosure or other proceedings or notice of sale relating to the property, nor by any change in the title or ownership of the property, nor by the occupation of the premises for purposes more hazardous than are permitted by this policy; and in case the mortgagor or owner shall neglect to pay any premium due under this policy, the mortgagee (or trustee) shall, on demand, pay the same. The mortgagee (or trustee) shall notify this company of any change of ownership or occupancy or increase of hazard which shall come to the knowledge of said mortgagee (or trustee) and, unless permitted by this policy, it shall be noted thereon and the mortgagee (or trustee) shall, on demand, pay the premium for such increased hazard for the term of the use thereof; otherwise this policy shall be null and void. This company reserves the right to cancel this policy at any time as provided by its terms, but in such case this policy shall continue in force for the benefit only of the mortgagee (or trustee) for ten days after notice to the mortgagee (or trustee) of such cancellation and shall then cease, and this company shall have the right on like notice to cancel this agreement. In case of any other insurance upon the within described property, this company shall not be liable under this policy for a greater proportion of any loss or damage sustained than the sum hereby insured bears to the whole amount of insurance on said property issued to or held by any party or parties having an insurable interest therein, whether as owner, mortgagee, or otherwise. Whenever this company shall pay the mortgagee (or trustee) any sum for loss or damage under this policy and shall claim that, as to the mortgagor or owner, no liability therefor existed, this company shall, to the extent of such payment, be thereupon legally subrogated to all the rights of the party to whom such payment shall be made, under all security held as collateral to the mortgage debt, or may, at its option, pay to the mortgagee (or trustee) the whole principal due or to grow due on the mortgage with interest, and shall thereupon receive a full assignment and transfer of the mortgage and of all such other securities; but no subrogation shall impair the right of the mortgagee (or trustee) to recover the full amount of_claim. Nothing in the foregoing prescribed form shall be construed to in any manner modify the provisions of section 83-13-5. (Emphasis supplied).

We held in Bacot v. Phoenix Insurance Co., 96 Miss. 223, 50 So. 729 (1909) that the statute is automatically written into every fire insurance policy on buildings taken out by a mortgagor or grantor in a deed of trust. We also held in Bacot that the statute has the effect of making an independent contract in favor of the mortgagee which is not impaired by any act or neglect of the mortgagor or owner of the property.

In Barry & Brewer v. Wright, 168 Miss. 216, 150 So. 186 (1933) the statute was construed and, in a special concurring opinion, Justice Ethridge stated:

The statute is more than a mere contract; it announces a public policy, as well as provides the terms of a contract in regard to the mortgage clause, in every deed of trust or mortgage taken out on buildings in this state. The purpose of the statute is wholesome, and tends to preserve the property of the state. It removes the temptation to get insurance upon property greater than the interest of the owner of the property insured; and it also tends to prevent having insurance on the same property in separate policies, payable to separate persons, having separate interests in the property. The statute is highly favorable to the mortgagee. It makes his insurance on the mortgaged property valid, regardless of the neglect of the mortgagor or owner, or by change of ownership or foreclosure proceedings, or by occupation of the premises for purposes more hazardous than are permitted by the policy. The mortgagee is not put to the trouble or risk of seeing that the mortgagor or owner has truly stated the facts, and has kept up the premiums, or has continued as the owner of the property. As a compensation for this benefit, highly advantageous to the mortgagee, the statute has imposed on the mortgagee the duty of paying the premiums if the mortgagor shall not pay them, on a demand for such payment by the insurance company, or those who stand in its right. It also imposes upon the mortgagee, or trustee, the duty to notify the company of any change of ownership or occupancy, or increased hazard, which shall come to the knowledge of the mortgagee or trustee, where the risk is not authorized by the terms of the policy, and the mortgagee or trustee, on demand, shall pay increased premiums for such increased hazard, if any, involved in the change of ownership, or change of conditions affecting the risk. Under the statute, every person taking a mortgage on the character of property covered by the statute, takes it subject to the terms of the statute; he takes the benefit with the burdens, as a part of his right to such security, and if the policy is issued, his right or interest in the property will be protected by the statute. (168 Miss. at 231, 232, 150 So. at 189).

We approve and adopt the construction of the statute quoted above and reaffirm the principle that the statute announces a public policy applicable to every fire insurance policy issued on buildings taken out by a mortgagor or grantor in a deed of trust. We held, in Hennessey v. Helgason, 168 Miss. 834, 151 So. 724 (1934), that the statute makes both the mortgagor and the mortgagee liable to the insurance company for payment of premiums, with the obligation of the mortgagor being primary, and that of the mortgagee being in the nature of a surety or guarantor.

The statute also authorizes an insurance company to cancel a policy and the mortgage clause agreement at any time as provided by the terms of the policy, but provides that the policy shall continue in force for the benefit of the mortgagee or trustee for ten days after notice to the mortgagee or trustee of such cancellation.

The fire insurance policy involved in this case is a continuous policy subject to the payment of the premium specified and contains the following provision:

In consideration of the provisions and stipulations herein, or added hereto, and of the premium above specified, this company, for the term of one year beginning at noon of the date hereof to noon, of the following yearly date, standard time, at the location of the property insured, and continuously thereafter from year to year, for each succeeding year for which the premium is paid in advance, .

Under the terms of the quoted provision the policy is automatically cancelled for nonpayment of each annual premium; however, the provision conflicts with the ten day notice requirement of the statute and is ineffective to a mortgagee, but is effective to a mortgagor or owner of the property.

National Security contends it sent a notice to Mid-State and the mortgagor about two weeks before May 16, 1974 that the renewal premium would be due May 16, 1974, and this notice satisfied the requirement of the statute. Assuming the notice was sent by National Security, the notice did not constitute notice to the mortgagee, Mid-State, that the policy was cancelled for nonpayment of the premium due. Mid-State was entitled, under the statute, to ten days notice of cancellation for nonpayment of premium. As a compensation for this benefit to the mortgagee, the statute has imposed on the mortgagee the duty of paying the premium if the mortgagor fails to pay the premium on a demand for such payment by the insurance company.

After the premium was not paid by the mortgagor on May 16,1974, National Security should have demanded payment of the premium by the mortgagee, Mid-State, or if it desired to cancel the policy for nonpayment of the premium, ten days notice of such intent should have been given to Mid-State who could have paid the premium within the ten day period.

AFFIRMED.

PATTERSON, C. J., and SMITH and ROBERTSON, P. JJ., and WALKER, BROOM, LEE, BOWLING and COFER, JJ., concur.

      . National Security is not licensed to do business in Mississippi; therefore, attorneys’ fees were properly awarded under the provisions of section 83-21-51 Mississippi Code Annotated (1972).


text:
    Warren BROWN v. The CITY OF MERIDIAN.
    No. 51162.
    Supreme Court of Mississippi.
    May 16, 1979.
    Adams & Odom, Joe R. Odom, Meridian, for appellant.
    Williams, Gunn & Crenshaw, William J. Gunn, Meridian, for appellee.
    Before PATTERSON, SUGG and COF-ER, JJ.
   SUGG, Justice,

for the Court:

Warren Brown was dismissed from the Meridian Police Department by the City Manager because Brown maintained his residence outside the corporate limits of the City in violation of a resolution adopted by the City Council on January 2, 1957 which required all employees of the Police and Fire Departments to maintain their residences within the corporate limits of the City of Meridian. Brown was granted a hearing by the Board of Civil Service Commission of the City which sustained his dismissal. The Circuit Court of Lauderdale County affirmed the action of the Commission.

Meridian operates under the Council-Manager plan of government as authorized by sections 21-9-1 through 21-9-83 Mississippi Code Annotated (Supp.1978). Section 21-9-51 provides:

Every resolution or ordinance passed by the council, except as herein provided, shall be certified by the city clerk, approved by the mayor or a majority of all the members of the council, published or posted as now required by law or the charter of such city, and recorded in the ordinance book, before the same shall be in force. However, any ordinance for the immediate and temporary preservation of the public peace, health or safety, which contains a statement of the reasons for its urgency and is passed by a vote of at least a majority of the members of the council, plus one, shall be in effect from and after its passage and approval by the council.

The resolution was not in force at the time Brown was dismissed because it had not been published and recorded in the ordinance book of the City as required by section 21-9-51; therefore, Brown’s dismissal for violation of the resolution was without cause.

We reverse and remand to the Board of Civil Service Commission of the City of Meridian with directions to reinstate Brown as a member of the Police Department.

REVERSED AND REMANDED.

PATTERSON, C. J., SMITH and ROBERTSON, P. JJ., and WALKER, BROOM, LEE, BOWLING and COFER, JJ., concur.

      . Municipalities may require its employees to reside within the corporate limits. Hattiesburg Firefighters Local 184 v. City of Hattiesburg, 263 So.2d 767 (Miss.1972).


text:
    FINANCE AMERICA PRIVATE BRANDS, INC. v. James H. DURBIN, d/b/a Durbin’s TV and Appliance.
    No. 51225.
    Supreme Court of Mississippi.
    May 16, 1979.
    Megehee, Brown & Williams, John M. Kinard, Pascagoula, for appellant.
    Pritchard, Myers & Gordon, Robert A. Pritchard, Pascagoula, for appellee.
    Before PATTERSON, SUGG and COF-ER, JJ.
   SUGG, Justice,

for the Court:

Finance America Private Brands, Inc. filed a declaration in replevin against James H. Durbin, d/b/a Durbin’s TV and Appliance in the Circuit Court of Jackson County. Plaintiff alleged in its declaration that defendant was indebted to the plaintiff under the terms of a security agreement; plaintiff was entitled to immediate possession of certain personal property described in the declaration in order to deal with it in accordance with the terms of the security agreement; and, defendant wrongfully withheld possession of the property. Defendant answered and denied that he was in default because he had tendered plaintiff all sums due it before the declaration in replevin was filed. Defendant made his answer a counterclaim and sued for $2,500,-000 for financial loss, embarrassment, destruction of credit, etc.

At the trial, and over the objection of plaintiff, the trial judge submitted to the juiy the issue of possession of the property and also submitted the issue of damages claimed by the defendant. The jury returned a verdict on the counterclaim in favor of the defendant for $140,000. Plaintiff made a motion for a judgment n. o. v., and, in the alternative, for a new trial. The trial judge granted a new trial on the issue of damages only and plaintiff appealed.

Plaintiff contends on direct appeal that the trial court should not have submitted to the jury the issue of damages claimed by defendant until after the issue of possession was decided in favor of the defendant. Defendant argues that plaintiff has no standing under section 11-7-213 Mississippi Code Annotated (1972) to appeal from the order granting a new trial on damages.

Defendant cross-appealed and contends that the trial judge abused his discretion by granting a new trial on damages because the damages awarded by the jury were not excessive. We do not reach the cross-appeal because the issue of damages should not have been submitted except on a writ of inquiry following a verdict by the jury on the question of possession.

I

The first question on direct appeal is whether the trial judge erred by submitting the combined issues of possession and damages for decision by the jury at the same time in the trial of the replevin action.

Chapter 508, Mississippi General Laws (1975) [section 11-37-101 through 157 Mississippi Code Annotated (Supp.1978)] repealed the existing replevin statutes and is a new replevin statute enacted to meet the due process requirements of the United States Constitution as mandated by the United States Supreme Court.

At the outset we should note some of the procedural changes affected by the new replevin statute. Under the new statute, section 11-37-101 Mississippi Code Annotated (Supp.1978), a replevin action is commenced by filing a declaration under oath setting forth the facts required by the section. The pleadings are then presented to a judge or justice court judge who is authorized to direct the issuance of a writ of replevin for the seizure of the property described in the declaration upon plaintiff posting bond in the amount fixed by the judge.

Section 11-37-109 provides that the writ of replevin shall command the sheriff or other local officer to take possession of the property and deliver it to the plaintiff after two days unless bonded by the defendant and to summon defendant to answer and appear before the court shown in the writ.

If the return of the officer on the writ shows a failure to take the property, but the defendant has been summoned, the plaintiff may declare and prosecute the action for the recovery of the value of the property and damages for the taking and detention of the property as if he had thus commenced his action, whereupon the plaintiff and his sureties shall, upon motion, be discharged on their bond.

Section 11-37-127 and 129 provide that either plaintiff or defendant may recover damages under the conditions set forth in the statute upon a writ of inquiry. The question of damages may not be submitted until trial on the declaration has been completed and judgment rendered either for the plaintiff or the defendant. If judgment is for the plaintiff, no provision is made for the defendant to recover damages.

The statute was considered in General Motors Acceptance Corporation v. Fairley, 359 So.2d 1386 (Miss.1978) where we stated:

The recently enacted replevin statutes, Mississippi Code Annotated, Sections 11-37-101 through 11-37-157, inclusive, (Supp.1977), still provide for an immediate remedy where a chattel is unlawfully held or detained to gain possession thereof, in term time or vacation after five days notice. Although Mississippi Code Annotated, Section 11-37-127 (Supp. 1977) authorizes a judgment for the value of the property if the property cannot be found, only the recovery of the property or value plus any statutory damages as therein provided is allowed. If the judgment be for the defendant, then Mississippi Code Annotated, Section 11-37-129 (Supp.1977) sets the statutory limits of his recovery.
After a careful consideration of the office of replevin, we have reached the conclusion that the Laws of 1975, ch. 508, do not permit a defendant to file a counterclaim or recoupment except for the specific statutory damages. A replevin action is a possessory action for specific property and not a suit for monetary damages. No provision is made under the above law for a judgment of money, except for the wrongful taking, detention, value of the specific property, or damages for wrongful suing out of the writ. (359 So.2d at 1388).

The language used in General Motors is susceptible to the interpretation that we have authorized filing a counterclaim or recoupment along with the answer of the defendant. The statute does not permit filing a counterclaim or recoupment with the answer, but damages may be awarded to a defendant only on a writ of inquiry after judgment for the defendant on the question of possession of the property. In order to clarify our language in General Motors we hold that if a defendant or a plaintiff seeks damages, such damages must be sought after judgment on the issue of possession on a writ of inquiry, and not by way of counterclaim or recoupment filed with the answer. It was error for the trial court to submit the issue of possession and the issue of damages to the jury at the same time.

II

The second question for decision is defendant’s contention that the plaintiff has no standing to appeal under section 11-7-213 Mississippi Code Annotated (1972) until after a new trial on the issue of damages is held.

Every new trial granted shall be on such terms as the court shall direct; and no more than two new trials shall be granted to the same party in any cause. Provided, however, that when the sole ground for a new trial is the excessiveness or inadequacy of damages assessed, the party aggrieved may elect to appeal from the order granting a new trial. [Section 11-7-213 Mississippi Code Annotated (Supp.1975)].

In Tagert v. Baker, 57 Miss. 303 (1879), this Court construed Section 647 Mississippi Code 1871 (now section 11-7-213). In Ta-gert, the trial court set aside the third verdict rendered for the plaintiff and granted defendant a fourth trial. Plaintiff appealed and assigned as the sole ground of error that the court was without power to grant a fourth trial to the defendant. It was argued by the defendant that the appeal was premature because an appeal from an order granting a new trial does not lie until the new trial is held; that plaintiff should have awaited the result of the fourth trial; and if dissatisfied with the results of the new trial, should have taken an appeal.

The Court held:

Ordinarily this doctrine is correct, but an order granting a new trial after three concurring verdicts is exceptional and peculiar. If no errors of law have intervened in the progress of the several trials, and if all the new trials have been granted because of incorrect conclusions of the jury as to matters of fact, the court has no power to set aside a third verdict; and its order to that effect being a nullity, the successful party has a right to demand the rendition of a judgment in his favor. He must, therefore, if this be refused, have the right to bring the ease before this court directly, and have the question tested, whether the fourth trial was awarded under circumstances which authorized it. If we should be of opinion that it was unauthorized, we would reverse and vacate the order, and remand the case with instructions to the lower court to render a judgment nunc pro tunc on the last verdict found by the jury. (57 Miss, at 304, 305). (Emphasis supplied).

The principle announced in Tagert is applicable to this case because the order of the judge granting a new trial on damages only after he had erroneously submitted simultaneously the issues of possession and damages is contrary to the replevin statute. Justice demands that the plaintiff be permitted to bring its case before this Court directly and have the question tested whether the procedure followed by the trial judge was proper. Otherwise, a new trial on the issue of damages only would avail nothing except a decision by this Court on appeal that error was committed in the first trial by improperly submitting combined issues to the jury.

The order of the trial court directing a new trial on the issue of damages only is reversed and the case remanded with directions to try the issue of the right of possession of the property first. If the verdict is for the defendant, then damages to the defendant may be assessed on a writ of inquiry.

REVERSED AND REMANDED.

PATTERSON, C. J., SMITH and ROBERTSON, P. JJ., and WALKER, BROOM, LEE, BOWLING and COFER, JJ., concur.


text:
    GEORGIA-PACIFIC CORPORATION v. Charles L. McLAURIN.
    No. 50811.
    Supreme Court of Mississippi.
    May 16, 1979.

      Fair & Mayo, James C. Mayo, Louisville, for appellant.
    Dixon L. Pyles, Jackson, for appellee.
    Before SMITH, LEE and COFER, JJ.
   SMITH, Presiding Justice,

for the Court:

PART I

This is an appeal by Georgia-Pacific Corporation, a self-insurer under the Workmen’s Compensation Act, from a final judgment of the Circuit Court of Smith County which affirmed an award of compensation to Charles L. McLaurin, claimant-employee, by the Mississippi Workmen’s Compensation Commission. We reverse and remand.

Upon the hearing before the administrative judge, claimant was allowed to introduce into evidence, over the objection of the employer-appellant, certain unsworn reports of claimant’s doctor, the doctor not being present or available for cross-examination. These “reports” in the main, consisted of a series of letters written by the doctor to the claimant’s attorneys. They comprised the only medical “findings” offered by claimant in support of his claim, and statements contained in them were substantially contradicted by medical experts who testified for the employer.

The action of the administrative judge in admitting these ex parte unsworn medical reports is without precedent in Mississippi.

In Dunn’s, Mississippi Workmen’s Compensation section 394.3 (2d Ed. 1977), it is stated:

A. Doctors’ Reports : Written reports of doctors should not be admitted into evidence when the reporting doctor is not presented for cross-examination, except by agreement. No distinction in this respect should be drawn between kinds of reports. For example, reports of treating physicians as well as those of examining physicians who see the employee for evaluation for compensation purposes should be excluded as hearsay and this applies whether the reports are on required Commission forms or consist of narrative statements. On the other hand, if the doctor testifies, and is subject to cross-examination, his written report may be admitted after identification by him and after he has testified that it is correct. When so qualified and admitted into evidence, such reports may be accepted and acted upon to the same extent as if the doctor had testified at the hearing as set forth therein.

In admitting the reports, the administrative judge stated that he did so in reliance upon Richardson v. Perales, 402 U.S. 389, 91 S.Ct. 1420, 28 L.Ed.2d 842 (1971).

In Richardson v. Perales, supra, the Court stated:

The Social Security Act has been with us since 1935. Act of August 14, 1935, 49 Stat. 620. It affects nearly all of us. The system’s administrative structure and procedures, with essential determinations numbering into the millions, are of a size and extent difficult to comprehend. But, as the Government’s brief here accurately pronounces, “Such a system must be fair — and it must work.”
(402 U.S. at 399, 91 S.Ct. at 1426, 28 L.Ed.2d at 851).
We conclude that a written report by a licensed physician who has examined the claimant and who sets forth in his report his medical findings in his area of competence may be received as evidence in a disability hearing and, despite its hearsay character and an absence of cross-examination, and despite the presence of opposing direct medical testimony and testimony by the claimant himself, may constitute substantial evidence supportive of a finding by the hearing examiner adverse to the claimant, when the claimant has not exercised his right to subpoena the reporting physician and thereby provide himself with the opportunity for cross-examination of the physician.
(402 U.S. at 402, 91 S.Ct. at 1428, 28 L.Ed.2d at 853).

In 1978, the United States Fifth Circuit Court of Appeals dealt with the question of the admission into evidence of ex parte reports of doctors in cases involving disability claims brought under the Longshoremen’s and Harbor Workers’ Compensation Act, § 1 et seq., 33 U.S.C.A. § 901 et seq.

In Bethlehem Steel Corporation v. Clayton, 578 F.2d 113 (5th Cir. 1978), one Clayton had injured his back and had filed a claim against his employer, Bethlehem, under the provisions of the Act. Following a hearing before the administrative judge, an award of compensation was made and this was affirmed by the Benefits Review Board. On appeal, employer contended that the admission of the ex parte medical report of Clayton’s doctor was error and, since it was the only medical “evidence” tending to support the claim, the award was not supported by substantial evidence.

The Longshoremen’s Act is closely analogous to the Mississippi Workmen’s Compensation Act. In Bethlehem, the Court reviewed the authorities, including Perales, and reversed, saying:

Our decision in this ease is controlled by Southern Stevedoring Company v. Voris, 190 F.2d 275 (5th Cir.1951). That case also involved a claim under the Longshoremen’s Act as well as a challenge to the admission of ex parte statements from doctors. As we said in that case, “By admitting these ex parte statements, upon which the deputy commissioner apparently based his decision, at least in part, the right of cross examination was effectively denied appellants upon a crucial issue. Even under the liberal provisions of the Longshoremen’s Act, we can not sanction this practice.” 190 F.2d at 277.
Southern Stevedoring has not been overruled by later cases. Dicta in Young and Company v. Shea, 397 F.2d 185, 188 (5th Cir.1968), cert. denied, 395 U.S. 920, 89 S.Ct. 1771, 23 L.Ed.2d 237 (1969), stated that hearsay was admissible in proceedings under the Longshoremen’s Act. But Shea did not purport to announce a different rule and, in fact, depended upon Southern Stevedoring. Moreover, She a directly relied upon a Second Circuit case, Rocker v. Celebrezze, 358 F.2d 119 (2d Cir. 1966), which had held that hearsay was admissible in Social Security hearings. In a later Fifth Circuit case, however, this court carefully distinguished claims under the Longshoremen’s Act from those under the Social Security Act. Cohen v. Perales, 412 F.2d 44 (5th Cir. 1969). Perales reasoned that because of the different statutory provisions, ex parte statements could be admitted under the Social Security Act though they could not be used under the Longshoremen’s Act. In reversing this court’s decision, the Supreme Court did not disturb this analysis of proper procedures; instead the Supreme Court reached a different conclusion based upon the facts. Richardson v. Perales, 402 U.S. 389, 91 S.Ct. 1420, 28 L.Ed.2d 842 (1971).

The admission of the “reports” under the circumstances here, the doctor not being available for cross-examination, falls short of the standards set up by Rule 8 of the Workmen’s Compensation Commission, which requires that evidence considered must not only be relevant, but “competent.”

This rule of the Commission seems a recognition that its rule making power does not extend to admitting incompetent evidence where such admission would amount to a denial of due process. Nor does the “liberal construction” of the Workmen’s Compensation Act permit the disregard of traditional notions of fair play and substantial justice in the adversary proceedings contemplated by the Act.

When the case was called on the date set, counsel for the employer had no advance notice that claimant would not call his doctor, or of claimant’s intention to offer the doctor’s ex parte unsworn “reports” into evidence. It is suggested that the offer of the administrative judge to continue the case so that employer could take the deposition of the doctor, obviated the objection to the reports based upon the absence of an opportunity to cross-examine. We do not agree.

In Workmen’s Compensation cases the testimony of the doctor as to his “medical findings” is the sine qua non to recovery under the statute. It is an understatement to say that this testimony is important.

It is quite likely that the bench and bar would be scandalized if this Court should approve the receiving in evidence of ex parte, unsworn statements of persons other than doctors, even in Workmen’s Compensation cases.

While doctors occupy an important role in our scheme of things, they are, after all, merely human, and may not be considered wholly free from the frailties that beset the rest of us. There is nothing, therefore, in the fact that a witness may be a member of the medical profession that reasonably may be said to justify his exemption from the requirements and restrictions which would apply to others giving testimony as witnesses in an adversary proceeding. The admission of the reports constitutes reversible error.

At the hearing, certain motion picture film was offered by employer, purporting to show activities of claimant inconsistent with his representation as to his physical condition. The administrative judge refused to allow the introduction of the film, apparently upon the basis of Barham v. Nowell, 243 Miss. 441, 138 So.2d 493 (1962). This was error since the record reflects a substantial compliance with the criteria set forth in Barham. The film was not forwarded here, as a part of the record, and we are unable to rule upon the relevancy or competency of its subject matter. On remand, it should be determined whether the subject matter of the film is relevant to the issue and would serve to shed light upon claimant’s physical condition. If so, it should be admitted.

PART II

Section 22 of the Mississippi Workmen’s Compensation Act, being Mississippi Code Annotated section 71-3-55 (1972), provides in part as follows:

In making an investigation or inquiry or conducting a hearing, the commission shall not be bound by common law or statutory rules of evidence or by technical or formal rules or procedure, except as provided by this chapter, but may make such investigation or inquiry or conduct such hearing in such manner as best to ascertain the rights of the parties.

Pursuant to the authority granted in the above section of the original act, the Workmen’s Compensation Commission adopted Rule 8 under its rules of procedure. This rule provides in part:

In compensation hearings the general rules of evidence shall be relaxed so as to permit the introduction of any relevant and competent evidence pertaining to the issue that will throw light on the matter in controversy. .

Probably the reason for the Commission’s order authorizing the admission of written reports was based on the increasing cost of presenting live medical testimony at the hearings. Under the inherent rule-making power of this Court, we supplement the previous order of the Workmen’s Compensation Commission, (and suggest that the Commission formally adopt a rule under its rule-making power) and provide guidelines and safeguards to apply prospectively, in such future cases (and pending cases, if practical) which will permit medical reports to be introduced as evidence by either party, to insure protection of the adversary system and the principle of non-admission of hearsay evidence under common law directives, as follows:

(1) At least thirty days prior to a hearing before the administrative judge the party desiring to introduce a written medical report from a physician shall forward a copy of the report to opposing counsel and the administrative judge, together with written notice that the original report was proposed to be introduced in evidence at the hearing without the presence of the report’s author. By giving such written notice and forwarding the reports to opposing counsel, or the opposing party, if not represented by counsel, the party intending to offer the report waives the privileged communication made by the party to a physician or surgeon as provided in Mississippi Code Annotated section 13-1-31 (1972). The party against whom the report is to be offered, after written notice given as set out above, shall have the privilege of contacting the physician and/or securing his deposition prior to the hearing, and his presence at the hearing.

(2) Within fifteen days after such service, the party upon whom such report and notice shall have been served, may demand the taking of the deposition of the reporting physician. In such event, the party proposing to offer the report shall cooperate in obtaining and arranging for the taking thereof, at the earliest time and at a place convenient to all parties.

If at a hearing before the administrative judge the party against whom the written document introduced shall show sufficient cause for not being able to secure the testimony of the physician or his attendance at the hearing, the administrative judge may, in his discretion, recess the hearing in order to give such party an opportunity to complete its right of examination or cross-examination of the physician.

(3) Such report shall be signed and verified by the oath of the medical expert making it, and shall be regarded as the testimony of such expert to the facts stated in the report. False statements in the report shall subject the deponent to the same penalties, to the same extent, as if he had personally appeared and testified to such statements on oath as a witness in open court. The contents of such report shall be restricted to such matters as lie within the personal knowledge of the doctor or to which he would have been allowed to testify, if he had been personally present as a witness. Statements in the report shall be subject to the same objections as to admissibility, relevancy and competency as the testimony of the reporting doctor would have been, if he had been personally present.

(4)In taking the deposition of the opposite party’s doctor under the above circumstances, the party taking same shall not be deemed to have made the doctor his witness, but shall have the same right of cross-examination, as if the doctor had testified as a witness for the party offering the report.

The case is remanded to the Mississippi Workmen’s Compensation Commission for further proceedings not inconsistent with this opinion.

REVERSED AND REMANDED TO MISSISSIPPI WORKMEN’S COMPENSATION COMMISSION.

PATTERSON, C. J., and ROBERTSON, P. J., and SUGG, WALKER, BROOM, LEE, BOWLING and GOFER, JJ., concur.


text:
    QUAKER OATS COMPANY, Employer, The Travelers Insurance Company, Carrier v. Littrell B. MILLER, Claimant.
    No. 50987.
    Supreme Court of Mississippi.
    May 16, 1979.

      Megehee, Brown & Williams, Larry A. Smith, Pascagoula, for appellant.
    Cupit & Maxey, Robert W. Sneed, Jackson, for appellee.
    Before PATTERSON, BROOM and BOWLING, JJ.
   PATTERSON, Chief Justice,

for the Court:

This is an appeal by Littrell B. Miller’s former employer, Quaker Oats Company, and its carrier, Travelers Insurance Company, from a judgment of the Circuit Court of Jackson County. That court affirmed an order of the Workmen’s Compensation Commission granting Miller $28 a week for 450 weeks as apportioned total benefits arising from job-related aggravation of hypertension.

Miller entered the employ of Quaker Oats Company in 1954. His job consisted of inspecting containers of canned pet food in an assembly line method of production. He was exposed to considerable heat since the containers were filled with pet food of high temperature. During the late 1950’s to the early 1960’s Miller developed high blood pressure which was treated by Dr. Hicks. The condition reappeared in 1969 and by 1970 Miller was experiencing “dizzy spells” and faintness which interfered with his employment. Dr. McBroom, a specialist in internal medicine, treated Miller with various medications, but this failed to reduce the hypertension.

The company informed Miller in March 1973 that his job performance was deteriorating. In consultation, Dr. McBroom was of the opinion that it was necessary for Miller to leave his work in order for the hypertension to be controlled. Acting upon his physician’s advice, Miller began a four-month sick leave on March 30, 1973, and later, in mid-August 1973, Miller permanently severed his employment by retiring. It is undisputed that Miller was unaware that his disability was compensable until he was advised by an attorney in April 1974. Claimant’s motion to controvert was thereafter filed on July 17, 1975.

The appellants maintain the trial court erred by (1) finding a causal connection between injury and employment, (2) not designating an independent physician to examine Miller and therefore Dr. McBroom’s fees were not recoverable, and (3) adjudicating the claim was not barred by limitations.

We need not reach the first two assignments of error because we are of the opinion the Workmen’s Compensation Commission and the circuit court erred as a matter of law in their adjudications that the statute of limitations had not run.

Mississippi Code Annotated section 71 — 3— 35 (1972), Limitation, subsection (1) provides:

(1) No claim for compensation shall be maintained unless, within thirty (30) days after the occurrence of the injury, actual notice was received by the employer or by an officer, manager, or designated representative of an employer. If no representative has been designated by posters placed in one or more conspicuous places, then notice received by any superior shall be sufficient. Absence of notice shall not bar recovery if it is found that the employer had knowledge of the injury and was not prejudiced by the employee’s failure to give notice. Regardless of whether notice was received, if no payment of compensation (other than medical treatment or burial expense) is made and no application for benefits filed with the commission within two years from the date of the injury or death, the right to compensation therefor shall be barred. (Emphasis added.)

Limitation of action was not considered by the administrative judge, apparently because it was not called to his attention. However, when the claim was considered by the full commission, limitation was an issue. Two of the commissioners were of the opinion the statute had not run. They stated:

Although the issue of whether the claim should be barred by the two-year statute of limitations was not urged during the hearings before the Administrative Judge or on review, this matter has been carefully considered by the Full Commission, and the Majority Members of the Commission find sufficient evidence reflected in the record to sustain a finding that the claimant was unaware of the compensa-ble nature of his injuries until August of 1973. As such, claimant’s MOTION TO CONTROVERT filed on July 17, 1975, was within the above mentioned statute of limitations, although claimant last worked for defendant on March 30, 1973.

The other commissioner was of the opinion that the statute of limitations had run, thereby barring the claim. His opinion was:

It is the opinion of Commissioner Hill that this claim for benefits is barred by Section 12 of the Mississippi Workmen’s Compensation Act, and that the MOTION TO CONTROVERT was filed on July 17, 1975, a period of more than two years since the date on which claimant’s longstanding hypertensive condition resulted in disability.
Therefore, it is the opinion of Commissioner Hill that the date on which claimant had knowledge of his disability is controlling, and that accordingly, the MOTION TO CONTROVERT should have been filed sometime prior to March 30, 1975.

On appeal to the circuit judge the majority order of the commission was affirmed.

The issue presented is, in our opinion, one of law rather than a review of conflicting facts.

We recognize fully that a latent injury does not cause the statute to begin to run until the disabling nature of the injury manifests itself. Pepsi Cola Bottling Co. of Tupelo, Inc. v. Long, 362 So.2d 182 (Miss.1978); Struthers Wells-Gulfport, Inc. v. Bradford, 304 So.2d 645 (Miss.1974); and Tabor Motor Co. v. Garrard, 233 So.2d 811 (Miss.1970). However, our language in each of these cases needs clarification. In Tabor we stated with regard to limitations, the following:

In short, the two-year limitation statute does not begin to run until by reasonable care and diligence it is discoverable and apparent that a compensable injury has been sustained. 2 Larson, Workmen’s Compensation Law, § 78.41 (1969). (Emphasis added.)

In Struthers Wells-Gulfport we stated in referring to Tabor the following:

We also pointed out that under the statute the claim period runs from the time that a compensable injury becomes apparent. . . The word “injury” in the two-year statute refers to a compen-sable injury from which incapacity and its extent can reasonably be ascertained by medical evidence. Thus, Mrs. Bradford had no compensable injury resulting from the spider bite until it became reasonably apparent that she had a disability arising therefrom. Consequently, we are in agreement with the circuit court that the statute of limitations does not begin to run until by reasonable care and diligence it is discoverable and apparent that a compensable injury has been sustained. . (304 So.2d at 649) (Emphasis added.)

And, in Pepsi Cola Bottling Co. we held in reliance upon Struthers Wells-Gulfport and Tabor the following:

We stated that the word “injury” in the two-year statute referred to a compensa-ble injury from which incapacity and its extent could reasonably be ascertained by medical evidence and upheld the Tabor case finding that the statute of limitations did not bar claimant’s recovery. (362 So.2d at 185)

We continued by stating:

In our opinion it was virtually impossible for him to know at the time of the apparently minor accident, then non-compensa-ble, that it would develop into a compen-sa ble injury. . . . (362 So.2d at 185) (Emphasis added.)

By using the word “compensable” or “non-compensable” injury or disease instead of “disabling” or “non-disabling” injury or disease the impression has apparently been left with the commission and others that the statute begins to run only from the time the claimant is aware that he is entitled to compensation (payment) for a work-connected disability.

In each of the cited cases the primary issue was a determination of when the disability arose from an accident or bite, initially considered insignificant, but which progressed over a period of time to disabling proportions. In each we uniformly held the statute did not begin to run until the disabling characteristics of the work-related injuries or bite became known.

The present issue differs. In the first instance, probably immaterial, this claim arises from a progressive disease and not an accidental injury. It differs materially in that this claimant was aware of his illness, had knowledge of its nature, its seriousness, and the aggravation, leading to disability, was work connected. The claimant did not know his disability entitled him to payment, i. e., it was compensable. This last factor projects a novel question not found in either of the cited cases and which has not been considered by the Court.

In Long, Struthers Wells-Gulfport and Tabor, we did not use the word “compensa-ble” or “non-compensable” injury to connote legal knowledge that a claim is within the Workmen’s Compensation Act. What we meant then and now attempt to clarify is that “compensable” injury means that the disabling injury was work connected. Progressing from this distinction to the present facts, the remaining issue is, when did the statute of limitations begin to run?

Larson, Workmen’s Compensation, section 78.41 (1978), explains what we believe to be a reasonable rule derived from any cases upon the subject:

The time period for notice or claim does not begin to run until the claimant, as a reasonable man, should recognize the nature, seriousness and probable compensa-ble character of his injury or disease.

In explanation, it is stated:

In the rule as stated at the outset of this subsection, three characteristics of claimant’s condition were identified as those that, if they should have been recognized by claimant as a reasonable man, will cause the statutory period to start to run: (1) The nature, (2) the seriousness, and (3) the probable compensable character of the injury or disease. These components overlap at many points, but they supply a convenient rough outline within which to discuss the relevant cases.

We note that in many of the cases cited in Larson the term “probable compensable character” means nothing more than the injury or disease was work related.

In giving application to this rule, we are led to believe, and now hold, the statute of limitations began to run on March 31, 1973, when Miller left his employment on sick leave. At that time as a reasonable man Miller knew, or should have known, the nature, seriousness and disabling character of his disease. By his testimony Miller had actual knowledge of his disability and that it was caused by a work-connected aggravation of hypertension.

In our opinion the two-year limitation statute began to run on March 31,1973, and barred this action two years thereafter.

We conclude the circuit court erred as a matter of law in affirming the commission’s decision that the statute of limitations had not run.

This case was considered by a conference of the justices en banc.

REVERSED AND RENDERED.

SMITH and ROBERTSON, P. JJ., and SUGG, WALKER, BROOM, LEE, BOWLING and COFER, JJ., concur.