source: Caselaw Access Project

author: MAXWELL, JUSTICE, FOR THE COURT:

license: Public Domain

text:
    Laqunn GARY a/k/a Lagunn Gary a/k/a Laqunn Sharod Gary v. STATE of Mississippi
    NO. 2014-KA-01172-SCT
    Supreme Court of Mississippi.
    February 8, 2018
    ATTORNEYS FOR APPELLANT: OFFICE OF THE STATE PUBLIC DEFENDER BY: BENJAMIN ALLEN SUBER, GEORGE T. HOLMES
    ATTORNEY FOR APPELLEE: OFFICE OF THE ATTORNEY GENERAL BY: ALICIA MARIE AINSWORTH
    EN BANC.
   MAXWELL, JUSTICE, FOR THE COURT:

¶ 1. Laqunn Gary carjacked Vizavian Trent Darby at gunpoint. When Darby refused to get out of the car, Gary shot Darby in the head, killing him. At Gary's trial, the jury watched a video of Gary confessing to killing Darby. The jury found Gary guilty of capital murder. He was sentenced to life in prison without parole.

¶ 2. On appeal, Gary challenges the admission of his confession. Before trial, Gary had filed a motion to suppress his confession, claiming he had not voluntarily waived his Miranda rights. The trial court ruled the confession was voluntary. But it reached this conclusion without holding a full suppression hearing in which the State carried the burden to prove voluntariness. Because this violated Gary's due-process rights, we remanded this case to the trial court to conduct a suppression hearing. At this hearing, the State presented one of the detectives who was present when Gary confessed. She testified Gary had not been coerced or promised any reward. Instead, Gary signed the Miranda waiver and answered the detectives' questions voluntarily. Based on her testimony, the signed Miranda statement, and Gary's demeanor during the video confession, the trial judge determined Gary's confession was voluntary.

¶ 3. To this decision, we apply the high standard of manifest error. Because the evidence supports that Gary's confession was voluntary, we affirm the trial court's denial of the motion to suppress. We also find no merit to Gary's claims that the evidence was insufficient, the verdict was against the overwhelming weight of the evidence, or reversal is warranted based on cumulative error.

¶ 4. We thus affirm Gary's capital murder conviction and sentence of life without parole.

Background Facts and Procedural History

I. Investigation

¶ 5. On February 11, 2012, Jackson police officers found Darby's body lying in the grass at the corner of Carter Avenue and Markham Street. He had been shot in the head. Darby had last been seen alive driving away from his house in a white Dodge Charger his mother had rented while her car was in the shop. Two days later, police discovered the Charger abandoned nearby. The windshield was cracked. Forensic analysis linked the crack to impact from a projectile from the inside of the vehicle. The crime scene investigator's on-site testing also revealed the presence of blood not visible to the naked eye. Later DNA testing showed the blood in the car belonged to Darby.

¶ 6. The police picked up Gary as a suspect on February 14, 2012. Detective Eric Smith and his partner Detective Patricia Wilder were assigned the case. After advising Gary of his Miranda rights and obtaining a written waiver, they questioned him. Gary's interview was recorded by a video camera.

¶ 7. At first, Gary claimed he had been walking down the street when Darby stopped the car in front of him. Gary said he then saw his friend Jamiria Travis jump out of the car and run across the railroad tracks. Gary claimed Darby then drew a gun on him. Gary said it was a "him or me" situation. So Gary pulled his pistol and shot him. Gary said he did not know Darby and could not explain why Darby would jump out of his car and pull a gun on him.

¶ 8. The detectives then explained they had already talked to Travis, and Gary's story was inconsistent with hers. Plus, forensic evidence showed Darby had been shot inside the car. Gary then confessed to what actually happened. Travis had told Gary that Darby had a car and some money. The plan was to rob him. Travis called Darby to come pick her up at Gary's house and give her a ride. When Darby arrived, Travis got in the front seat and Gary in the back. Gary had a gun, and apparently so did Darby. When Darby refused to get out of the car, Gary shot Darby in the back of the head. Gary and Travis then drug Darby's body out of the car. Gary drove Travis to South Jackson. Then he hid both his and Darby's guns underneath a church and dumped the car.

¶ 9. After the interrogation, Gary led Detective Smith and Deputy Chief Brent Winstead to the hidden guns. Gary also turned in the clothes he had been wearing the day he shot Darby, which he happened to be still wearing. His shirt was tested by the Mississippi Crime Lab, which found traces of Darby's blood and DNA.

¶ 10. Gary and Travis were indicted for capital murder, with robbery as the underlying felony. See Miss. Code Ann. § 97-3-19(2)(e) (Rev. 2014).

II. Motion to Suppress

¶ 11. Only Gary was tried. Before trial, Gary's counsel moved to suppress the video confession, along with Gary's signed statement. Gary's counsel argued Gary had only been seventeen years old in February 2012-too young to voluntarily waive his constitutional rights.

¶ 12. The State's position was that Gary's confession was voluntary. But it could not call Detective Smith to verify this, because Detective Smith had been shot and killed while interviewing a suspect in an unrelated case. The State also had trouble getting Detective Wilder to testify. She had witnessed her partner's murder and purportedly was suffering from post-traumatic stress disorder (PTSD). The State filed a pretrial motion to determine her availability as a witness. Detective Wilder responded with a motion to quash her subpoena. Four days before trial, the trial court heard both motions. At this hearing, Detective Wilder's therapist testified about Wilder's PTSD and the potential harmful impact testifying might have on her.

¶ 13. Both the State and Gary informed the court that Detective Wilder's potential unavailability would impact Gary's suppression hearing, since the State intended to call Detective Wilder to prove Gary's confession was voluntary and to authenticate the video of the confession. Gary's counsel reminded the court about Gary's pending suppression motion, urging an age-based challenge to the voluntariness of his Miranda waiver. At this point, a disagreement arose about Gary's true age. While Gary's counsel asserted he was seventeen when he confessed, the State insisted Gary was in fact eighteen, based on his birth date. Though the current hearing was about Wilder's availability to testify-not the admissibility of Gary's confession-Gary's counsel offered to put Gary on the stand for the limited purpose of confirming the year he was born.

¶ 14. When Gary testified he was born in November 1994, which would have made him seventeen in February 2012, the State requested they be allowed to cross-examine Gary. The State showed Gary the Miranda waiver form and written statement, which listed his date of birth. Gary confirmed that he could read and write and that it was his signature on two of the pages. But he insisted the officers never asked him about his birthday. At this point, the State asked to show the video confession, suggesting that within the first thirty seconds of the video statement, Gary told Detective Smith and Detective Wilder he was born in 1993-making him eighteen, not seventeen. Over Gary's objection, the trial court permitted several minutes of the video to be played-up to when Gary was asked about his date of birth. Gary confirmed that he was the person in the video, that the video depicted him being interviewed by the two detectives, and that he had told the detectives he was born in 1993.

¶ 15. After Gary's brief testimony, the hearing shifted back to the issue of Detective Wilder's availability to testify. The hearing ended with the trial court taking the issue of Detective Wilder's availability under advisement.

¶ 16. On the morning of trial, the court announced that it had deemed Detective Wilder an unavailable witness. The court also confirmed it was denying Gary's motion to suppress his written statement and video-recorded confession. Gary's counsel spoke up, arguing Gary had not been heard on his motion to suppress. And though the court agreed with Gary's counsel that Gary "was not fully heard on his motions" to suppress the written statement and video-recorded confession, the court still ruled his confession was voluntary.

¶ 17. During trial, Gary's video confession and Miranda waiver was admitted through Deputy Chief Winstead, who was present when Gary was brought in for questioning, though not in the interrogation room. The jury found Gary guilty of capital murder. He was sentenced to life imprisonment without parole.

III. Appeal

¶ 18. Gary appealed, raising four issues:

(1) The trial court erred by not suppressing the interrogation video;
(2) The evidence was insufficient to convict Gary of capital murder instead of manslaughter;
(3) The trial court erred in denying Gary's motion for a new trial because the verdict was against the overwhelming weight of the evidence; and
(4) There was cumulative error that deprived Gary of his right to a fundamentally fair and impartial trial.

¶ 19. In Gary I , we addressed the first issue only. Gary v. State , 237 So.3d 100,2016 WL 7014026 (Miss. Dec. 1, 2016). Because Gary had a due-process right to a suppression hearing, which the trial court acknowledged Gary had not actually been given, we remanded this issue to the trial court to conduct a suppression hearing. Id.

IV. Hearing on Remand

¶ 20. Complying with our mandate, the trial court held the suppression hearing on May 4, 2017. To meet its burden to prove the confession was voluntary, the State called Detective Wilder. She testified she had been present when Gary was read his rights and signed the Miranda waiver. She confirmed Gary had knowingly and voluntarily waived his rights.

¶ 21. Gary then testified. In his pre-trial motion to suppress, he had claimed he was only seventeen and too young to intelligently waive his constitutional rights. On remand at the suppression hearing, he abandoned this claim. Instead, he insisted he had been high on marijuana when the police picked him up on February 14, 2012, and that he was never read his Miranda rights. He also claimed Detective Smith had reassured him he was "just investigating the case" and would let him go after the interview.

¶ 22. Detective Wilder testified that she was not aware of any private conversation between Detective Smith and Gary. And neither she nor Detective Smith made any threats or promises to Gary. Further, Gary had not appeared drunk or intoxicated in any way. If so, she and her partner would not have interviewed him.

¶ 23. The trial court found the State had met its burden to prove Gary's confession was voluntary. And Gary had failed to rebut this. Gary's assertion that he had been high was contradicted by Detective Wilder's testimony and by Gary's demeanor on the video. So was his assertion that he had not been read his Miranda rights. And Gary's claim Detective Smith said he was "just investigating the case" could not be construed as an offer or reward that induced Gary's confession.

¶ 24. Having determined Gary's confession was voluntarily and admissible, the trial court denied Gary's motion to suppress. The trial court then filed its order with this Court for our consideration. We now take up all four issues raised in Gary's appeal, starting with the motion to suppress.

Discussion

I. Motion to Suppress

¶ 25. With our mandate in Gary I went Gary's initial argument why the trial court erred in not granting his motion to suppress. Gary had argued the trial court should have not relied on his testimony at the pretrial hearing to confirm that his confession was voluntary. Instead, the State should have been required to make a prima facie case that the confession was voluntarily made without any threats, coercion, or offer of reward.

¶ 26. We agreed. Because he challenged the voluntariness of his confession, Gary had "a due process right to a reliable determination that the confession was in fact voluntarily given," which is protected by a hearing outside the presence of the jury. Gary I , 237 So.3d at 102-03, 2016 WL 7014026, at *3 (quoting Cox v. State , 586 So.2d 761, 763 (Miss. 1991) ). At this hearing, it is the State-not the defendant-who bears the burden to prove beyond a reasonable doubt that the confession was voluntarily made. "And only after the State makes its prima facie case does the defendant have to put on evidence of coercion or involuntariness." Id. (citing Agee v. State , 185 So.2d 671, 673 (Miss. 1966) ). Because the trial court had not required the State to make a prima facie showing that Gary's confession was voluntary, we remanded this issue to the trial court to hold a suppression hearing to decide if Gary's confession had been in fact admissible. Id. (citing Jackson v. Denno , 378 U.S. 368, 394, 84 S.Ct. 1774, 12 L.Ed.2d 908 (1964) ; Conerly v. State , 760 So.2d 737, 742 (Miss. 2000).

¶ 27. The trial court followed our mandate. At the suppression hearing, the burden was placed squarely on the State to prove the confession had been voluntary. See Agee , 185 So.2d at 673. The State met this burden through the testimony of Detective Wilder, who personally witnessed Gary being read his Miranda rights and signing the Miranda waiver form. Detective Wilder testified Gary had not been threatened, coerced, or offered any reward for testifying. And he had not appeared to be under the influence.

¶ 28. In his supplemental brief, filed after the suppression hearing, Gary argues the trial court erred "by limiting the cross-examination" of Detective Wilder. Gary cites Walley v. State , 240 Miss. 136, 126 So.2d 534, 535 (1961), as support for why he had a right to cross-examine Detective Wilder about her mental health, perception, memory, and trustworthiness. He claims the trial court limited this right because, though it gave counsel "a little latitude" on questions about her mental condition, it forbade "an evaluation into her mental and physical condition." But the hearing transcript does not support this claim. The State did object to questions about Detective Wilder's medical treatment in 2014-the time of Gary's trial-claiming irrelevance. But the trial court overruled the objection. The judge told Gary's counsel, "I'm going to give you a little more room on this, Counsel. But you need to make it relevant. And a fishing expedition into her mental and physical concerns are approaching irrelevant." At this point, counsel proceeded with pointed questions about Detective Wilder's PTSD, which she answered. Counsel then moved on to another topic on his own volition. At no point did counsel ask a question about Detective Wilder's mental or physical health to which the trial court sustained an objection. And Gary has failed to show what questions his counsel would have asked but for the trial court's prohibition. So Gary's assertion that the trial court somehow limited his cross-examination of Detective Wilder is without merit.

¶ 29. "The trial judge is the fact-finder during a suppression hearing[.]" Butler v. State , 102 So.3d 260, 270 (Miss. 2012). In this role, "the judge must consider the totality of the circumstances to determine if a defendant intelligently, knowingly, and voluntarily waived his Miranda rights." Scott v. State , 8 So.3d 855, 862 (Miss. 2008). And if a judge makes such a determination and denies a motion to suppress a confession, this Court can reverse only based on "manifest error." Id. at 861. "The standard of manifest error is high, and this Court cannot reverse unless the trial judge's ruling has gone against the substantial weight of the evidence." Id.

¶ 30. Here, the judge considered both Detective Wilder's and Gary's testimony, the signed Miranda waiver, and the video confession to reach the ultimate conclusion that Gary's confession was voluntary. Because "the evidence supports the trial judge's denial to suppress the confession," we "cannot reverse." Id. at 862.

II. Motion for Judgment Notwithstanding the Verdict

¶ 31. We now turn to the other issues Gary raised that were not addressed in Gary I .

¶ 32. Gary next argues the trial judge erred by not granting his posttrial motion for a judgment notwithstanding the verdict. Gary claims the evidence was insufficient to convict him of capital murder. At most, he argues, the State proved he committed manslaughter.

¶ 33. Gary was indicted and convicted of violating Section 97-3-19(2)(e). Under this provision-

The killing of a human being without the authority of law by any means or in any manner shall be capital murder ... [w]hen done with or without any design to effect death, by any person engaged in the commission of the crime of rape, burglary, kidnapping, arson, robbery, sexual battery, unnatural intercourse with any child under the age of twelve (12), or nonconsensual unnatural intercourse with mankind, or in any attempt to commit such felonies[.]

Miss. Code Ann. § 97-3-19(2)(e). The underlying crime in this case was robbery. So the State's burden was to prove beyond a reasonable doubt that Gary killed Darby without authority of law while engaged in the commission of a robbery or in the attempt to commit a robbery.

¶ 34. Gary argues the State failed to meet this burden because it did not prove each element of robbery. "Robbery has three essential elements: (1) felonious intent, (2) force or putting in fear as a means of effectuating the intent, and (3) by that means taking and carrying away the property of another from his person or in his presence.' " Veazy v. State , 113 So.3d 1226, 1229 (Miss. 2013) (quoting Croft v. State , 992 So.2d 1151, 1157 (Miss. 2008) ). And as Gary sees it, the intent element was lacking because the State did not prove Gary intended to take any of Darby's property. At most, the evidence established Gary intended to forcibly take the car, which he claims did not belong to Darby since his mother had rented it. But we have made clear "that robbery relates to possession of property, not to title." Id. at 1232 (emphasis added). And, here, it was undisputed that Darby was in lawful possession of the Dodge Charger when Gary jumped in the backseat to steal it. See Bullock v. State , 391 So.2d 601, 606-09 (Miss. 1980) (affirming capital-murder conviction, with underlying felony of robbery of a vehicle, where it was undisputed the victim was in lawful possession of the vehicle when the defendant carjacked and murdered him).

¶ 35. When reviewing the sufficiency of the evidence, "the relevant question is whether, after viewing the evidence in the light most favorable to the prosecution, any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt." Bush v. State , 895 So.2d 836, 843 (Miss. 2005). In the video, Gary admitted the plan was to steal Darby's car. Travis called Darby to come pick her and Gary up. And Gary brought his gun with him to forcibly take the car from Darby's personal possession. When Darby resisted, Gary said he shot Darby in the back of the head, killing him. Viewing this evidence in the light most favorable to the State, a rational juror could have certainly found beyond a reasonable doubt that all the elements of capital murder-including all the elements of the underlying crime of robbery-had been proven.

¶ 36. Thus, the trial court did not err in denying Gary's motion for a judgment notwithstanding the verdict.

III. Weight of the Evidence

¶ 37. Alternatively, Gary argues his posttrial motion for a new trial should have been granted because the jury's verdict was contrary to the overwhelming weight of the evidence.

¶ 38. A motion for a new trial based on the weight of the evidence falls squarely within the trial court's discretion. Little v. State , 233 So.3d 288, 292-93 (Miss. 2017). When reviewing the denial of such motion, "we weigh the evidence in the light most favorable to the verdict, 'only disturbing a verdict when it is so contrary to the overwhelming weight of the evidence that to allow it to stand would sanction an unconscionable injustice.' " Id. (quoting Lindsey v. State , 212 So.3d 44, 45 (Miss. 2017) ).

¶ 39. Here, the overwhelming weight of the evidence is consistent with, not contrary to, the jury's guilty verdict. Not only did Gary confess, but his confession was consistent with the other evidence presented. Forensic examination proved Darby was shot in the car-just as Gary said. Darby's blood was found on Gary's shirt, which Gary admitted he had been wearing the day he shot Darby. And Gary himself led the police to the murder weapons.

¶ 40. Still, Gary asserts there were "far too many questions left unanswered to convict [him] of capital murder." Specifically, Gary points to the fact analysts only found one spot of Darby's blood on Gary's shirt, though Gary claimed he dragged Darby's body out of the car. And why, if he had murdered Darby, would he still be wearing the same shirt three days later? Gary also suggests the State avoided bringing up Travis, perhaps to downplay that Gary had a lesser role in the murder.

¶ 41. But resolving factual questions is precisely why we have juries. See Evans v. State , 159 Miss. 561, 566, 132 So. 563, 564 (1931) ("[J]uries are impaneled for the very purpose of passing upon such questions of disputed fact[.]"). And this Court will not disturb a jury's verdict when substantial evidence supports it. Bridges v. State , 716 So.2d 614, 617 (Miss. 1998).

¶ 42. We find the jury was presented ample evidence Gary committed the murder. Thus, the trial court did not abuse its discretion in denying Gary's motion for a new trial.

IV. Cumulative Error

¶ 43. Finally, Gary claims cumulative error warrants a new trial. But "where there is no reversible error in any part, there is no reversible error to the whole." Gray v. State , 887 So.2d 158, 172 (Miss. 2004).

¶ 44. The one error we found-the trial court's failure to hold a formal suppression hearing, in which the State and not Gary was required to prove the voluntariness of the confession-was remedied through ordering a suppression hearing in Gary I . At this hearing, the trial court found Gary's confession was voluntary and admissible. See Jackson , 378 U.S. at 394, 84 S.Ct. at 1790 (holding that, if after a proper suppression hearing the confession is found to be voluntary and admissible, there is "no constitutional necessity at that point for proceeding with a new trial"). So Gary is not entitled to a new trial on this claim.

¶ 45. Because Gary has pointed to no other errors, "there can be no cumulative effect and no adverse impact upon his constitutional right to fair trial." Id. at 172-73.

¶ 46. We therefore affirm Gary's conviction of capital murder and sentence to life in prison without parole.

¶ 47. AFFIRMED.

WALLER, C.J., RANDOLPH AND KITCHENS, P.JJ., KING, COLEMAN, BEAM, CHAMBERLIN AND ISHEE, JJ., CONCUR.

      Miranda v. Arizona , 384 U.S. 436, 86 S.Ct. 1602, 16 L.Ed.2d 694 (1966) (requiring that, prior to a custodial interrogation, the person be warned he has a right to remain silent, that any statement he makes may be used as evidence against him, and that he has a right to the presence of an attorney, either retained or appointed).

      Gary v. State , 237 So.3d 100, 2016 WL 7014026 (Miss. Dec. 1, 2016) (Gary I ).

      Scott v. State , 8 So.3d 855, 862 (Miss. 2008).

      The rental agreement also authorized Darby to drive the vehicle.

      The indictment also included a gun enhancement for "having used a firearm during the commission of a felony" in violation of Mississippi Code Section 97-37-37.

      The jury also heard from other investigating officers, Darby's mother, and several forensic examiners.

      See Jackson v. Denno , 378 U.S. 368, 394, 84 S.Ct. 1774, 1790, 12 L.Ed.2d 908 (1964) (remanding a criminal case to the state court to conduct a constitutionally adequate suppression hearing, because, if after a proper suppression hearing, the confession is found to be voluntary and admissible, there is "no constitutional necessity at that point for proceeding with a new trial"); see also Conerly v. State , 760 So.2d 737, 742 (Miss. 2000) (remanding a burglary case to the trial court for a probable-cause hearing, because no probable-cause determination had been made before admitting evidence found during the defendant's arrest).

      Detective Wilder had since left the Jackson Police Department and become a deputy with the Hinds County Sheriff's Office. At the suppression hearing, she identified herself as Patricia Wilder Williams. But for consistency, we continue to refer to her as "Detective Wilder."


author: COLEMAN, JUSTICE, FOR THE COURT: KING, JUSTICE, DISSENTING:

text:
    ILLINOIS CENTRAL RAILROAD COMPANY v. Bennie OAKES, Deceased, BY AND THROUGH Clara HAGAN, his Representative
    NO. 2015-CT-00644-SCT
    Supreme Court of Mississippi.
    February 15, 2018
    ATTORNEYS FOR APPELLANT: GLENN F. BECKHAM, HARRIS FREDERICK POWERS, III, Greenwood
    ATTORNEYS FOR APPELLEE: HENRY DEAN ANDREWS, JR., Vicksburg, TIMOTHY W. PORTER, PATRICK MALOUF, JOHN TIMOTHY GIVENS, Ridgeland
    EN BANC.
   COLEMAN, JUSTICE, FOR THE COURT:

¶ 1. The issue presented in the instant case is whether the defendant is entitled to a setoff for money already paid to the plaintiff for the same injuries alleged to have been caused by the defendant. It is not, as treated by the dissent, a case about apportionment of fault amongst different tortfeasors. As described by Illinois Central, who as appellant framed the issues for appeal, "This case is about whether, once those damages are assessed by a jury, a railroad company under the [Federal Employers' Liability Act] is entitled to a credit or reduction of that verdict for sums that have already been paid by others to the Plaintiff for the same injuries and damages." In Illinois Central's answer, it raised an affirmative defense that "it is entitled to apportionment or set off liability and/or damages for any negligence of or damages caused by third parties, including but not limited to other employers and manufacturers, distributors, and sellers of products to which plaintiff claims the decedent was exposed as alleged in the complaint." However, Illinois Central later clarified its position that it was not attempting to have negligence apportioned, and the circuit court echoed the clarification by stating that Illinois Central had not "tried to use a third, an empty chair for any other defendants."

¶ 2. The Court of Appeals issued an opinion affirming the Warren County Circuit Court's denial of Illinois Central Railroad's request for a setoff of a jury verdict awarded to Bennie Oakes through his representative Clara Hagan. We hold that the Court of Appeals misconstrued the primary case it relied upon and ignored other federal precedent; therefore, we reverse the Court of Appeals' judgment and the circuit court's denial of Illinois Central's motion for a setoff. We remand for proceedings consistent with our opinion.

FACTS AND PROCEDURAL HISTORY

¶ 3. On February 13, 2009, Clara Hagan filed a complaint, as the representative of Bennie Oakes, against Illinois Central in the Warren County Circuit Court. The complaint, brought under the provisions of the Federal Employers Liability Act, sought to recover damages for "personal injuries and/or death sustained by Bennie Oak[e]s, deceased, while [Oakes] was employed by [Illinois Central] and while engaging in interstate commerce."

¶ 4. Oakes had been an employee of Illinois Central from 1952 through 1994 and "was exposed to asbestos on a daily basis." The complaint contained allegations that:

As a result of his exposure to asbestos containing products and materials, [Oakes] has developed asbestosis, lung cancer, shortness of breath, reduced lung function, cough, chest congestion, and is at increased risk to develop one or more of the following diseases: mesothelioma, asbestos related pleural disease, mixed dust pneumoconiosis, sleep interruption, aggravation of pre-existing and co-existing disease, throat cancer, laryngeal cancer, colon, stomach, and other asbestos related cancer.

According to the complaint, due to Illinois Central's negligence in exposing Oakes to asbestos daily, Oakes incurred injury and damages.

¶ 5. The first trial occurred in 2011 but resulted in a hung jury. The jury in the second trial found in favor of Hagan and awarded $250,000 in damages; however, the jury also apportioned fault, with Illinois Central being twenty percent at fault and Oakes being eighty percent at fault. Therefore, the circuit court adjusted the damages accordingly, and the total award was $50,000. Illinois Central filed a Motion for Entry of Judgment and Setoff to have the damages reduced further based on its discovery that Hagan had received more than $65,000 in payments from asbestos trusts for Oakes's injuries and death. The circuit court denied Illinois Central's motion and entered the judgment of $50,000 plus eight percent interest.

¶ 6. Illinois Central appealed, and the case was assigned to the Court of Appeals. Writing for the Court of Appeals, Judge Greenlee framed the issue on appeal as "whether setoff against a jury verdict is required in [Federal Employers' Liability Act] cases where the claimant has already settled with separate tortfeasors." Illinois Cent. R.R. Co. v. Oakes , ---So.3d ----, ----, 2016 WL 7647571, *1 (¶ 4) (Miss. Ct. App. Dec. 13, 2016). The Court of Appeals held:

Because an injured railroad employee can recover all his damages from his railroad employer if the employer's negligence caused any part of the employee's injury, and because the collateral source rule does not allow for a defendant to avoid payment of damages based on compensation to the plaintiff from a third party that was not a party to the action, we find that an allowance of setoff for recoveries from nonparty tortfeasors is inconsistent with the [Federal Employers' Liability Act]'s intent, the statutory language, and Mississippi and U.S. Supreme Court precedent.

Id. at ----, 2016 WL 7647571, at *3 (¶ 11). Judge Wilson authored a dissent, joined by Presiding Judge Griffis, and explained that: "The sole issue in this appeal is whether the judgment against Illinois Central should be offset ... based on settlement payments that Hagan or Oakes previously received from the bankruptcy trusts of the manufacturers of the asbestos to which Oakes was exposed." Id. at ----, 2016 WL 7647571, at *3 (¶ 14). He further explained that "[t]he majority rule on this issue of federal law is that Illinois Central is entitled to such an offset ...." Finally, the dissent concluded:

Nothing in the [Federal Employers' Liability Act] entitles the plaintiff to more than one recovery for his damages. This case involves an injury caused by exposure to asbestos; the plaintiff has already been compensated for this same injury by the manufacturers of the asbestos; and there is no reason that her recovery against Illinois Central should not be reduced to account for those payments.

Id. at ----, 2016 WL 7647571, at *5 (¶ 22). Based on the Court of Appeals' decision, Illinois Central filed a petition for writ of certiorari, which the Court granted.

¶ 7. In its petition, Illinois Central argued that the Court of Appeals decision is in " 'irreconcilable conflict' with previous opinions ... and disregards the controlling federal law on the issue." Additionally, Illinois Central submitted that the primary case of Norfolk & Western Railway Company v. Ayers , 538 U.S. 135, 123 S.Ct. 1210, 155 L.Ed.2d 261 (2003), relied upon by the Court of Appeals' decision, was misconstrued and misapplied to the present case. Illinois Central also argued that the Court of Appeals' decision erred in holding that the collateral source rule applied to asbestos trusts set up by the now-bankrupt asbestos manufacturers as a condition of their bankruptcy proceedings. Finally, Illinois Central contended that the Court of Appeals' decision effectively "obliterates" the one-recovery rule by allowing Hagan to collect from the asbestos trust for the asbestos-related injury and also from Illinois Central for the same asbestos-related injury.

ANALYSIS

¶ 8. As the Court of Appeals noted, the issue in the present case is whether Illinois Central is entitled to a setoff of the jury verdict based on Oakes's or Hagan's receipt of settlement funds from an asbestos bankruptcy trust. We hold that it is, and the Court of Appeals and the circuit court erred in concluding otherwise. Additionally, the dissent makes the same mistake as the Court of Appeals by analyzing the case as an apportionment case instead of reviewing it as a question of whether double recovery is prohibited.

¶ 9. The Court of Appeals' majority opinion based its holding primarily on the United States Supreme Court case of Ayers . The majority states that the Supreme Court in Ayers rejected "the suggestion that the [Federal Employers' Liability Act] would permit damages to be apportioned among joint tortfeasors according to the degree of fault attributable to each." Oakes , --- So.3d at ----, 2016 WL 7647571, *2 (¶ 8) (citing Ayers , 538 U.S. at 161-65, 123 S.Ct. 1210 ). Further, "[t]he Ayers Court found significant that Congress, while expressly directing in the [Federal Employers' Liability Act] the apportionment of responsibility between employers and employee based on comparative fault, did not provide for such apportionment among potentially liable tortfeasors." Id. We hold that the Court of Appeals' majority opinion misunderstood and misapplied Ayers , while dismissing a bounty of other federal caselaw directly on the issue.

¶ 10. In Ayers , six former employees of Norfolk & Western Railway Company sued the company after they were diagnosis with asbestosis. Ayers , 538 U.S. at 140, 123 S.Ct. 1210. The case presented two issues involving the Federal Employers' Liability Act, with the second issue being pertinent to the present case.

The second issue concerns the extent of the railroad's liability when third parties not before the court-for example, prior or subsequent employers or asbestos manufacturers or suppliers-may have contributed to the worker's injury. Is the railroad answerable in full to the employee, so that pursuit of contribution or indemnity from other potentially liable enterprises is the railroad's sole damages-award-sharing recourse? Or is the railroad initially entitled to an apportionment among injury causing tortfeasors, i.e., a division of damages limiting the railroad's liability to the injured employee to a proportionate share?

Id. at 140-41, 123 S.Ct. 1210. Ultimately, the Supreme Court opinion held that the injured employee "may recover his or her full damages from the railroad, regardless of whether the injury was also caused 'in part' by the actions of a third party." Id. at 165, 123 S.Ct. 1210.

¶ 11. We do not read Ayers to analyze, much less prohibit, setoffs of jury verdicts. First, as the Court of Appeals' dissent pointed out, the Supreme Court noted that a setoff had occurred in Ayers , and there was no negative reaction or treatment of the setoff in the opinion. According to Ayers : "After reduction for three claimants' comparative negligence from smoking and for settlements with non-[Federal Employers' Liability Act] entities , the final judgments amounted to approximately $4.9 million." Ayers , 538 U.S. at 143, 123 S.Ct. 1210 (emphasis added). The Court of Appeals' majority does not mention the above-quoted language and does not attempt to explain or distinguish why the Supreme Court took no issue with a setoff there.

¶ 12. More importantly, our review of Ayers indicates that setoffs were not the issue. The issue in Ayers was whether fault could be apportioned among joint tortfeasors, and Ayers stands for the premise that a plaintiff may recover its full amount of damages from one defendant and places the burden on the defendant to seek contribution from other nonparty tortfeasors later. Ayers , 538 U.S. at 141, 123 S.Ct. 1210. For example, in the present case, had Illinois Central asked that the jury apportion fault to Illinois Central, Oakes, and the nonparty asbestos trusts, standing in the place of the now-bankrupt asbestos manufacturers, such request would have run afoul of Ayers . However, that is not what happened, and the jury apportioned fault between Illinois Central and Oakes, as permitted by the Federal Employers' Liability Act and Ayers . As the Court of Appeals' dissent explained:

It is one thing to hold, as the Ayers Court did, that an employee's recovery should not be reduced based on a jury's apportionment of fault to a nonparty. It is quite another thing to suggest that an employee should be able to recover the same damages over and over again from different parties, without any offset for compensation he has already received.

Oakes , --- So.3d at ----, 2016 WL 7647571, *4 (¶ 19). Simply, Ayers does not apply to the facts and issue of the present case. The trial court in the above-styled case has never apportioned fault to the asbestos trusts and, had it done so, it would have erred pursuant to Ayers . The settling asbestos trusts never have been held to be liable for the plaintiffs' injuries.

¶ 13. Since Ayers is not on point, we must look at other federal caselaw for guidance regarding whether Illinois Central is entitled to a setoff of the jury verdict. The leading federal case is Schadel v. Iowa Interstate Railroad, Ltd. , 381 F.3d 671, 676 (7th Cir. 2004). In Schadel , Douglas Schadel was injured on the job when a car driven by Brenda Kowalewicz careened through the warning gates and struck him. Id. at 673. Schadel sued the railroad company under the Federal Employers' Liability Act and also sued Kowalewicz under state law. Id. Schadel settled with Kowalewicz prior to trial, and she was dismissed from the case. Id. Kowalewicz's dismissal also extinguished the railroad company's cross-claim against her for contribution and indemnity. Id. at 674. At the trial between Schadel and the railroad company, the railroad company was not permitted to introduce Kowalewicz's settlement, and the jury was permitted to allocate fault only between Schadel and the railroad company. Id. However, once the jury returned a verdict, the trial court reduced the verdict based on Schadel's negligence and reduced the verdict further based on the Kowalewicz settlement. Id. The railroad company appealed, arguing that the trial court should have used a proportionate-share approach, which would have allowed the jury to allocate "responsibility among all three parties and impose[ ] damages on [the railroad company] only to the extent of its share of the liability." Id. After analyzing four approaches to address the allocation of damages in actions involving multiple tortfeasors, the Seventh Circuit concluded that the pro tanto approach, or the dollar-for-dollar approach, which the trial court applied, was the correct result consistent with the Federal Employers' Liability Act. Id. at 678. The Seventh Circuit's approach in Schadel was adopted in Mancini v. CSX Transportation, Inc. , No. 08-CV-933, 2010 WL 2985964, at *6 (N.D. N.Y. July 27, 2010) ; Benson v. CSX Transp. Inc. , 274 Fed.Appx. 273, 276 (4th Cir. 2008) ; Krueger v. Soo Line Railroad , No. 02-C-0611, 2005 WL 2234610, at *1 (E.D. Wis. Sept. 12, 2005) ; and Hess v. Norfolk Southern Railway Company , 106 Ohio St.3d 389, 835 N.E.2d 679, 689 (¶ 48) (2005), and we join the other jurisdictions in holding that the Schadel approach of a pro tanto credit in cases like the present is appropriate.

¶ 14. Even though Ayers does not apply to the issue presented in the case sub judice because the issue there was whether, under the Federal Employers' Liability Act, fault could be attributed to nonrailroad joint tortfeasors and the issue today is whether, after a verdict in which fault is not attributed to any other tortfeasors the defendant is entitled to a setoff equal to money already paid to the plaintiff for the same injuries, the principal purpose of the Federal Employers' Liability Act announced therein reinforces our holding. As argued by Oakes, "[The Federal Employers' Liability Act]'s express terms, reinforced by consistent judicial applications of the Act, allow a worker to recover his entire damages from a railroad whose negligence jointly caused an injury ..., thus placing on the railroad the burden of seeking contribution from other tortfeasors." Ayers , 538 U.S. at 141, 123 S.Ct. 1210. After adjustment for fault apportioned to Oakes, the jury's verdict awarded him $50,000 in damages. The asbestos trusts have paid him more than $50,000. Accordingly, he has recovered his entire damages from the asbestos trusts, and with the setoff, the Federal Employers' Liability Act's purpose has been fulfilled. Nowhere in Ayers or any other authorities cited by Oakes is there any indication that the Federal Employers' Liability Act contemplates that a plaintiff would receive more than his entire damages, as would be the case absent the setoff.

¶ 15. Indeed, the Ayers Court's description of the Federal Employers' Liability Act and its effect on and partial abridgement of the common law of damages buttresses our holding.

"To further [the Federal Employers' Liability Act's] humanitarian purposes, Congress did away with several common-law tort defenses that had effectively barred recovery by injured workers." [Consolidated Rail Corporation v.] Gottshall , 512 U.S. [532, 542], 114 S. Ct. 2396[ 129 L.Ed.2d 427 (1994) ]. As cataloged in Gottshall , the [Federal Employers' Liability Act] "abolished the fellow servant rule"; "rejected the doctrine of contributory negligence in favor of ... comparative negligence"; "prohibited employers from exempting themselves from the [Federal Employers' Liability Act] through contract"; and, in a 1939 amendment, "abolished the assumption of risk defense." Id. at 542-543, 114 S.Ct. 2396 ; see 45 U.S.C. §§ 51 - 55. "Only to the extent of these explicit statutory alterations," however, "is the [Federal Employers' Liability Act] 'an avowed departure from the rules of the common law.' " Gottshall , 512 U.S. at 544, 114 S.Ct. 2396 (quoting Sinkler v. Missouri Pacific R. Co. , 356 U.S. 326, 329, 78 S.Ct. 758, 2 L.Ed. 2d 799 (1958) ).

Ayers , 538 U.S. at 145, 123 S.Ct. 1210. The Ayers Court's holding that fault may not be apportioned between the railroad and nonrailroad defendants rests upon the Federal Employers' Liability Act's negating of the common law defense of apportionment. Id. at 161, 123 S.Ct. 1210. However, nothing in the statute changes the common law on damages to the effect that a defendant, such as Illinois Central in the case sub judice , would be prohibited from seeking a setoff from another entity who earlier paid the plaintiff for the same injuries.

¶ 16. Lastly, because we hold that Illinois Central is entitled to relief in the form of a pro tanto setoff consistent with Schadel , we do not address the remaining issues involving the collateral-source rule.

CONCLUSION

¶ 17. Although Illinois Central states in its briefs that the settlements were to compensate Oakes and Hagan for the same injuries as alleged in the current Federal Employers' Liability Act lawsuit, the record is less than clear. Accordingly, we reverse the Court of Appeals' and the circuit court's judgments denying Illinois Central a setoff, and we remand to the circuit court for further proceedings consistent with the instant opinion, including, if necessary, a hearing to determine whether the settlement indeed compensated the plaintiffs for the same injuries and the same type of damages as alleged in the lawsuit.

¶ 18. REVERSED AND REMANDED.

WALLER, C.J., MAXWELL, BEAM, CHAMBERLIN AND ISHEE, JJ., CONCUR. KING, J., DISSENTS WITH SEPARATE WRITTEN OPINION JOINED BY KITCHENS, P.J. RANDOLPH, P.J., NOT PARTICIPATING.

KING, JUSTICE, DISSENTING:

¶ 19. Because I believe that the Federal Employers' Liability Act (FELA) and Supreme Court precedent mandate that we not apply a pro tanto setoff in this case, I respectfully dissent.

¶ 20. The majority concludes that Illinois Central is entitled to a pro tanto setoff for asbestos trust payments Oakes received from parties which are not and never were parties to the litigation at hand. Pro tanto credits may be allowed for joint tortfeasors who are parties to the action. "Joint tointfeasor claims arise where the separate wrongful conduct of two or more individuals combine to cause an injury, and each because of his conduct bears some responsibility for the injury." J & J Timber Co. v. Broome , 932 So.2d 1, 8 (Miss. 2006) (internal quotations omitted) (emphases in original).

¶ 21. In Ayers , an asbestos case, the railroad argued that it should be allowed to apportion liability among other nonrailroad defendants. The United States Supreme Court noted that the FELA only allows the jury to apportion damages between the railroad and the employee, it "does not authorize apportionment of damages between railroad and nonrailroad causes." Norfolk & Western Ry. Co. v. Ayers , 538 U.S. 135, 159-60, 123 S.Ct. 1210, 155 L.Ed.2d 261 (2003). The Court concluded that "reading the FELA to require apportionment would handicap plaintiffs and could vastly complicate adjudications, all the more so if ... manufacturers and suppliers, as well as other employers, should come within the apportionment pool." Id. at 165, 123 S.Ct. 1210. "Once an employer has been adjudged negligent with respect to a given injury, it accords with the FELA's overarching purpose to require the employer to bear the burden of identifying other responsible parties and demonstrating that some of the costs of the injury should be spread to them[,]" referring specifically to actions for contribution. Id. at 165, and n.23, 123 S.Ct. 1210 (emphasis added). The United States Supreme Court ultimately held that "[u]nder the FELA, an employee who suffers an 'injury' caused 'in whole or in part' by a railroad's negligence may recover his or her full damages from the railroad, regardless of whether the injury was also caused 'in part' by the actions of a third party." Id. at 165-66, 123 S.Ct. 1210. While the United States Supreme Court was addressing apportionment among parties, not setoffs for a settlement, it specifically mentioned that plaintiffs would be handicapped if apportionment was allowed among asbestos manufacturers.

¶ 22. The federal cases cited by the majority are inapposite because they address setoffs due to the settlement of a party to the suit. Federal joinder law allows that persons may be joined as defendants if "any right to relief is asserted against them jointly, severally, or in the alternative with respect to or arising out of the same transaction, occurrence, or series of transactions or occurrences" and "any question of law or fact common to all defendants will arise in the action." Fed. R. Civ. P. 20(a)(2). When a plaintiff joins defendants in a lawsuit and the complaint alleges joint liability for the injury caused, the plaintiff essentially admits that the parties are joint tortfeasors. We have no such joinder and no such admission here. As such, the "employer ... bear[s] the burden of identifying other responsible parties and demonstrating that some of the costs of the injury should be spread to them." Ayers , 538 U.S. at 165, 123 S.Ct. 1210 (emphasis added). The employer made no such demonstration here. It merely put forth the amounts of asbestos trust settlements, without tying them to the injuries of the case or making some demonstration that the asbestos manufacturers were joint tortfeasors.

¶ 23. The Missouri Court of Appeals has rejected the notion that a settlement paid by a nonparty may be used as a setoff by the railroad. Palmer v. Union Pacific R. Co. , 311 S.W.3d 843 (Mo. Ct. App. 2010). It noted that allowing a setoff "overlooks the U.S. Supreme Court's rejection of the suggestion that FELA would permit damages to be apportioned among joint tortfeasors according to the degree of fault attributable to each." Id. at 856. It found significant that "Congress, while expressly directing in FELA the apportionment of responsibility between employer and employee based on comparative fault, did not provide for such apportionment among potentially liable tortfeasors." Id. The court noted that recognizing such a credit would exempt the railroad from a portion of its liability, which contradicts the express language of the FELA. Id. It also noted that the United States Supreme Court expressly placed the burden on the railroad to seek contribution from other tortfeasors, concluding that "an allowance of setoff for settlement recoveries received on behalf of a nonrailroad tortfeasor is inconsistent with FELA's intent, contradictory to the act's statutory language, and not in accordance with U.S. Supreme Court precedent." Id.

¶ 24. The United States Supreme Court has explicitly placed the burden on the employer in FELA cases to demonstrate that other parties should bear a portion of the costs. Illinois Central did not do so in this case. Its remedy is to seek contribution from other potential tortfeasors, not a setoff against the damages awarded the plaintiff. Therefore, I would affirm the judgments of the Warren County Circuit Court and the Court of Appeals denying the setoff.

KITCHENS, P.J., JOINS THIS OPINION.

      "The Federal Employers' Liability Act ... 45 U.S.C. §§ 51 -60, makes common railroads liable in damages to employees who suffer work-related injuries caused 'in whole or in part' by the railroad's negligence." Norfolk & Western Ry. Co. v. Ayers , 538 U. S. 135, 140, 123 S.Ct. 1210, 155 L.Ed.2d 261 (2003).

      The asbestos trust at issue was put into place during a Chapter 11 bankruptcy to "direct the processing, liquidation and payment" of asbestos personal injury claims. In re T H Agric. & Nutrition, L.L.C. , No. 08-14692, 2009 WL 7193573 (Bankr. S.D. N.Y. May 28, 2009).

      The narrow and specific issue at hand is whether, under federal law, the defendant is entitled to a setoff for payments received by Oakes from nonparties to the lawsuit, something the defendant is under a burden to show. The majority unilaterally changes the issue as to whether the plaintiff is entitled to a double recovery, and argues that the dissent reframes the issue as apportionment of fault among tortfeasors. Neither double recovery nor apportionment of fault among joint tortfeasors is at issue here. At issue is whether Illinois Central may claim a setoff for trust payments made by a nonparty to the litigation at hand, and, in this case, federal law does not allow Illinois Central to claim any setoff.

      In Mississippi, among joint tortfeasors, it is generally recognized that a negligent defendant "should not be allowed to escape liability for his negligence by the fortuity that a co-defendant has settled prior to trial." Broome , 932 So.2d at 8-9. However, in this case, we must apply federal law, and the FELA has a similar purpose: to fully compensate the injured employee. Norfolk & Western Ry. Co. v. Ayers , 538 U.S. 135, 144-45, 123 S.Ct. 1210, 155 L.Ed.2d 261 (2003).

      The majority makes much of the Supreme Court's mention in the recitation of facts that the verdict had been reduced for settlements with non-FELA entities. Yet, it does not appear that any setoff was appealed, much less its propriety addressed by the Supreme Court. Moreover, it is fair to assume that the settlements were with parties to the lawsuit.

      Moreover, the cases recognize that "[t]he purpose of the FELA ... is to facilitate the injured railroad employee's recovery." Schadel v. Iowa Interstate R.R., Ltd. , 381 F.3d 671, 678 (7th Cir. 2004).


text:
    KD HATTIESBURG 1128, INC., KD Hattiesburg II 1128A, Inc., Kimco Hattiesburg L.P., Kimco Hattiesburg II, L.P. and Kimco Developers, Inc. v. TURTLE CREEK CROSSING, LLC
    NO. 2016-IA-01118-SCT
    Supreme Court of Mississippi.
    February 15, 2018
    ATTORNEYS FOR APPELLANTS: LISA ANDERSON REPPETO, ANDREW SCOTT HARRIS.
    ATTORNEYS FOR APPELLEE: MARK A. NELSON, S. ROBERT HAMMOND, JR., NICHOLAS KANE THOMPSON.
    BEFORE KITCHENS, P.J., MAXWELL AND ISHEE, JJ.
   MAXWELL, JUSTICE, FOR THE COURT:

¶ 1. Turtle Creek Crossing, LLC, a minority interest holder in Kimco Hattiesburg, L.P., filed an action in circuit court after it learned it would receive no distribution from the sale of the partnership's only asset-a multimillion-dollar shopping center. In its complaint, Turtle Creek alleges its fellow partners breached their fiduciary duties and conspired with each other, the partnership, and a sister partnership to market and sell the asset in such a way as to keep Turtle Creek from profiting. It also asserts the partnerships commingled and misallocated funds. Turtle Creek seeks an accounting and damages.

¶ 2. The defendants responded with a motion to transfer the entire action or, alternatively, sever and transfer the equitable claims to chancery court. After their motion was denied, they filed for-and were granted-this interlocutory appeal. According to the defendants, the predominant claim is for an accounting-an equitable claim that belongs in chancery court. And had this case been filed in chancery court, there would be a strong argument for the chancery court's original jurisdiction over the accounting claim, as well as pendant jurisdiction over the legal claims. But Turtle Creek did not file this action in chancery court. It filed it in circuit court. And the circuit court too has original jurisdiction not only over the accounting claim but also Turtle Creek's other legal claims.

¶ 3. Because Turtle Creek chose a forum with proper subject-matter jurisdiction, that choice must be respected. We affirm the circuit court's denial of the motion to transfer and remand for further proceedings consistent with this opinion.

Background Facts and Procedural History

I. Two Partnerships

¶ 4. Kimco Hattiesburg, L.P., was formed in October 2004. The aim of the limited partnership was to develop "Phase I" of the Turtle Creek Crossing shopping center on Highway 98 West in Hattiesburg, Mississippi, with Target as the anchor tenant.

¶ 5. Under the original limited-partnership agreement, KD Hattiesburg 1128, Inc., was the general partner, with a one-percent interest. Kimco Developers, Inc., was the Class A limited partner, with a forty-nine-percent interest. And Turtle Creek Crossing, LLC, was the Class B limited partner, with a fifty-percent interest. But in October 2012, the limited-partnership agreement was amended. By agreement, Turtle Creek Crossing transferred half of its interest in the partnership to one of its members, Eric Seitz, who in turn transferred his interest to Kimco Developers. The following partnership structure resulted:

Kimco Hattiesburg, L.P. Partner Class Percentage Interest KD Hattiesburg 1128, Inc General Partner 1% Kimco Developers, Inc. Class A Limited Partner 49% Kimco Developers, Inc. Class B Limited Partner 25% Turtle Creek Crossing, LLC Class B Limited Partner 25%

¶ 6. In May 2007, a second limited partnership, Kimco Hattiesburg II, L.P., was formed to develop "Phase II" of the Turtle Creek Crossing shopping center, with Kohl's as the anchor tenant. KD Hattiesburg II 1128A, Inc., was the general partner; Kimco Developers, the Class A limited partner; and Turtle Creek Commons , LLC, was the Class B partner. As did Turtle Creek Crossing, Turtle Creek Commons transferred half of its interest in Kimco Hattiesburg II to member Seitz, who further transferred it to Kimco Developers in 2012, resulting in the following structure:

Kimco Hattiesburg II, L.P. Partner Class Percentage Interest KD Hattiesburg II 1128A, Inc. General Partner 1% Kimco Developers, Inc. Class A Limited Partner 49% Kimco Developers, Inc. Class B Limited Partner 25% Turtle Creek Commons, LLC Class B Limited Partner 25%

¶ 7. On November 4, 2015, general partner KD Hattiesburg 1128 notified Turtle Creek Crossing that a third party had offered $42,569,000 to buy Kimco Hattiesburg's single asset-Phase I of the Turtle Creek Crossing shopping center. That same day, KD Hattiesburg II 1128A notified Turtle Creek Commons of a third-party offer to buy Phase II for $5,531,000.

II. Turtle Creek Crossing's Complaint

¶ 8. In response to the offers, Turtle Creek Crossing filed a complaint in the Lamar County Circuit Court on November 16, 2015. The company named as defendants both partnerships, Kimco Hattiesburg and Kimco Hattiesburg II; both general partners, KD Hattiesburg 1128 and KD Hattiesburg II 1128A; and its fellow limited partner, Kimco Developers (collectively "Kimco" or "the Kimco Defendants").

¶ 9. Turtle Creek Crossing accused the Kimco Defendants of breaching their duty of loyalty. According to Turtle Creek Crossing, both properties were marketed together, even though they were the separate assets of separate limited partnerships. As a result, the offer reflects the aggregate appraised value of the two properties combined, instead of the fair market value of each property. And while selling the two properties together would benefit Kimco Hattiesburg II, KD Hattiesburg II 1128A, and Kimco Developers, the sale would damage Turtle Creek Crossing, which would receive no profits from the sale, based on the way the partnership agreement structured distributions.

¶ 10. Turtle Creek Crossing also accused Kimco of commingling the funds of the two limited partnerships in one "Kimco main cash account" so that the funds belonging to Kimco Hattiesburg, L.P., cannot be separated out. Such an "unorthodox accounting method," the complaint alleged, not only violated the limited partnership agreement and generally accepted accounting principles but also violated the defendants' duty of loyalty owed to Turtle Creek Crossing, which has been damaged as a result.

¶ 11. Turtle Creek Crossing's complaint brought nine counts:

(1) Accounting
(2) Interference with Contract and Interference with Business Relations
(3) Breach of Fiduciary Duty
(4) Breach of Contract, Tortious Breach of Contract, and Anticipatory Breach of Contract
(5) Injunction (6) Punitive Damages
(7) Negligence and Gross Negligence
(8) Conspiracy
(9) Declaratory Judgment

III. Kimco's Motions

¶ 12. Kimco responded with a motion to transfer or, alternatively, sever and transfer equitable claims. While this motion was heard on November 23, 2015, due to the pending motion for preliminary injunction, the circuit court decided to hold this motion in abeyance. Kimco then filed its answer, asserting counterclaims of breach of contract, breach of the implied duty of good faith and fair dealing, civil conspiracy, and abuse of process.

¶ 13. On March 4, 2016, Kimco filed a motion to dismiss. Kimco argued Turtle Creek Crossing's claims for legal damages constituted a derivative action, which Turtle Creek Crossing lacked standing to bring on behalf of the partnership. Alternatively, the motion requested the court compel the joinder of Turtle Creek Commons, which Kimco argued was an indispensable party. Prior to the ruling on the motion to dismiss, Kimco reasserted its motion to transfer or, alternatively, sever and transfer equitable claims.

¶ 14. The circuit court heard both motions on July 8, 2016. The court denied the motion to dismiss, specifically finding Turtle Creek Crossing's claims were not derivative. But it granted the motion to compel the joinder of Turtle Creek Commons as an indispensable party. The court also denied the motion to transfer or, alternatively, sever and transfer equitable claims, expressly finding:

[W]hile some of the relief requested in the Complaint may be equitable in nature, other relief sought are questions of law, and therefore the Court should retain jurisdiction. Mark S. Bounds Realty Partners, Inc. v. Lawrence , 34 So.3d 1224, 1229 (¶ 14) (Miss. Ct. App. 2010) ("In cases in which some doubt exists as to whether a complaint is legal or equitable in nature, the better practice is to try the case in circuit court."). Further, "Recent cases hold that equitable claims are more appropriately brought before a circuit court when they are connected to a contractual relationship or other claims tied to questions of law." Tyson Breeders, Inc. v. Harrison , 940 So.2d 230, 233 (¶ 9) (Miss. 2006). The motion is therefore denied.

¶ 15. Kimco filed for-and was granted-interlocutory appeal of the order denying its motion to transfer. It did not seek interlocutory appeal of the denial of the motion to dismiss.

Discussion

Motion to Transfer

¶ 16. A motion to transfer raises the question of subject-matter jurisdiction-a question this Court reviews de novo. Derr Plantation, Inc. v. Swarek , 14 So.3d 711, 715 (Miss. 2009). This question is particularly amenable to interlocutory appeal, because once a case proceeds to final judgment, that judgment will not be reversed based solely on subject-matter jurisdiction. Tillotson v. Anders , 551 So.2d 212, 215 (Miss. 1989). See also Derr Plantation , 14 So.3d at 716 ("A party aggrieved by the trial court's grant or denial of a motion to transfer may seek relief by pursuing an interlocutory appeal[.]").

¶ 17. This is why interlocutory appeal was granted in this case-to ensure on the front end that this case landed in the court with proper subject-matter jurisdiction. "To determine whether a court has subject matter jurisdiction, we look to the face of the complaint, examining the nature of the controversy and the relief sought." Derr Plantation , 14 So.3d at 716. See also Trustmark Nat'l Bank v. Johnson , 865 So.2d 1148, 1151-52 (Miss. 2004) (emphasizing that the substance and not the form of the claim controls). And, indeed, at first blush, because of the equitable nature of the accounting claim, as well as Kimco's assertion that all Turtle Creek's legal claims were really improper derivative claims, it appeared that Turtle Creek may have filed an action in circuit court that really belonged in chancery court. But upon further review, we find no jurisdictional problem with Turtle Creek Crossing's choice-circuit court.

¶ 18. Kimco's main argument on appeal is that the predominant claim is for an accounting, and an accounting claim belongs in chancery court. The Mississippi Constitution does grant the chancery court jurisdiction over "suits involving inquiry into matter of mutual accounts." Miss. Const. art. 6, § 161. This jurisdiction, however, is not exclusive but rather concurrent with the circuit court. Id. Section 161 provides, "if the plaintiff brings suit in the circuit court, ... the court may , on application of the defendant, transfer the cause to the chancery court, if it appears that the accounts to be investigated are mutual and complicated." Miss. Const. art. 6, § 161 (emphasis added). But transfer is not mandatory.

¶ 19. Still, chancery court "is the preferred court" to hear accounting matters. Re/Max Estate Partners, Inc. v. Lindsley , 840 So.2d 709, 713 (Miss. 2003). "There are three factors to consider when deciding whether a court of equity has jurisdiction over matters of account, (1) the need of discovery, (2) the complicated character of the accounts, and (3) the existence of a fiduciary or trust relation." Id. at 712 (citing Henry v. Donovan , 148 Miss. 278, 114 So. 482, 484 (1927) ). In this case, all three grounds are present. (1) There is a need for discovery. According to the complaint, without discovery, Turtle Creek Crossing has been unable to conduct an independent audit of Kimco's books. (2) The accounts are complicated. Again, according to the complaint, the accounts have been commingled and funds going in and out have been mislabeled. Moreover, the relief Turtle Creek Crossing seeks is based on a complex profit-sharing structure created by the partnership agreement. And (3) there exists a fiduciary relationship among the members of the partnership. See Fought v. Morris , 543 So.2d 167, 170 (Miss. 1989) (citing Ross v. Biggs , 206 Miss. 542, 40 So.2d 293, 296 (1949) ) (recognizing a fiduciary relationship among partners).

¶ 20. Thus, had Turtle Creek Crossing brought its complaint in chancery court, as did the plaintiff in Lindsley , the chancery court would have original jurisdiction over the accounting claim and pendant jurisdiction over the other legal claims. See Lindsley , 840 So.2d at 714. But unlike the plaintiff in Lindsley , Turtle Creek Crossing did not bring its action in chancery court. Instead, "[p]resumably with the knowledge that concurrent jurisdiction between chancery and circuit court existed for this matter," Turtle Creek Crossing chose to bring its suit for equitable and legal relief in circuit court. Id. at 713. "This was [its] choice and, if proper and fair, must be respected here." Id.

¶ 21. We find Turtle Creek Crossing's choice of circuit court was both proper and fair.

¶ 22. It was proper because, as the circuit court recognized, while some of the relief requested may be equitable in nature, other relief sought was legal, establishing the circuit court's jurisdiction over the entire complaint. See Derr Plantation , 14 So.3d at 716 ("[I]f the complaint seeks legal relief, even in combination with equitable relief, the circuit court can have proper subject matter jurisdiction."). Kimco is dismissive of Turtle Creek Crossing's legal claims, calling them an improper derivative action that should not dictate the jurisdictional question. But the circuit court rejected Kimco's derivative-action argument when it denied Kimco's separate motion to dismiss-a motion that is not part of this interlocutory appeal. Even so, without straying too far into an interlocutory issue that remains within the trial court's jurisdiction, it plainly appears from the face of the complaint that at least some of Turtle Creek Crossing's legal claims form a direct action.

¶ 23. Turtle Creek Crossing alleges the Kimco defendants conspired against it , not the partnership, and manipulated the accounting and sale price of the Target property in violation of the fiduciary duties owed it , not the partnership. See Fought , 543 So.2d at 171 (recognizing members of closely-held corporation-like members of partnerships-owe fiduciary duties to each other in addition to the corporation). Indeed, its theory of liability is that the defendants structured the sale in such a way that the partnerships would profit but Turtle Creek Crossing would not. In other words, Turtle Creek Crossing seeks to recover for its own injuries, not just injuries to the partnership as a whole. See, e.g. , Brothers v. Winstead , 129 So.3d 906, 923-24 (Miss. 2014) (recognizing an LLC member had an individual claim for legal damages for the breach of fiduciary duties owed him, which was separate from a claim of breach of fiduciary duties owed to the company). Thus, for these individual legal claims, Turtle Creek Crossing has properly sought legal relief in the circuit court-the court of general jurisdiction. See Tillotson , 551 So.2d at 215 (citing Miss. Const. art. 6, § 156 ).

¶ 24. In addition to being proper, Turtle Creek Crossing's choice of court also was fair. Under our constitution, "the right of trial by jury shall remain inviolate." Miss. Const. art. 3, § 31. But only in circuit court can Turtle Creek Crossing exercise this right. See Burnette v. Hartford Underwriters Ins. Co. , 770 So.2d 948, 952 (Miss. 2000) (recognizing the plaintiffs' "right to a jury trial would be infringed upon if this case were heard in chancery court"). For this reason, we have held that any doubt should be resolved in favor of circuit-court jurisdiction. Derr Plantation , 14 So.3d at 716 (citing Burnette , 770 So.2d at 952 ).

¶ 25. So because Turtle Creek Crossing's decision to file its action in circuit court, versus chancery court, was both proper and fair, as in Lindsley , it should "be respected here." Lindsley , 840 So.2d at 713. We affirm the circuit court's denial of the motion to transfer and remand this case for further proceedings consistent with this opinion.

¶ 26. AFFIRMED AND REMANDED.

WALLER, C.J., RANDOLPH AND KITCHENS, P.JJ., KING, COLEMAN, BEAM, CHAMBERLIN AND ISHEE, JJ., CONCUR.

      Kimco Developers, Inc., is incorporated in Delaware. All other entities in this suit are Mississippi corporations, companies, or partnerships.

      Though they share the same members, Turtle Creek Commons is a separate legal entity from Turtle Creek Crossing.

      In this count, Turtle Creek Crossing sought to enjoin the sale of the Target property. Soon after the complaint was filed, the circuit court granted a preliminary injunction. While the sale of the two properties could go forward, the circuit court enjoined the two limited partnerships, Kimco Hattiesburg and Kimco Hattiesburg II, from distributing any of the profits. Instead, the $8,100,000 in profits had to "be segregated into separate depository account(s) and held in trust by the Defendants, pending further order of the [Circuit] Court, and all such proceeds shall be accounted for to the Court under the Courts' supervision, auspices and control."
      In January 2016, the parties agreed to dissolve the injunction. While the agreed order to dissolve leaves unclear the reasons why, Turtle Creek Crossing's later amended complaint explains nonparty Kimco Realty Corporation-the Kimco Defendants' parent company-executed a guaranty agreement to hold the $8.1 million in escrow until this lawsuit ended, in case Turtle Creek Crossing should succeed.

      See note 3, supra .

      This is a key distinction between this case and two cases on which Kimco relies, Germany v. Germany , 123 So.3d 423 (Miss. 2013), and Trustmark National Bank v. Johnson , 865 So.2d 1148 (Miss. 2004). In those cases, this Court held the respective divorce-related and testamentary-related claims could be tried only in chancery court. Moreover, in both cases, actions were already pending in chancery court.

      Stated simply, a "derivative action" is one brought on behalf of a corporation (or in this case a partnership). An interest holder brings the action in the name of the corporation to recover for injuries to the corporation. Mathis v. ERA Franchise Sys., Inc. , 25 So.3d 298, 303 (Miss. 2009). To be able to bring a derivative action on behalf of a corporation, an interest holder must follow certain procedures-procedures that were not followed here, as Kimco is quick to point out. See Scafidi v. Hille , 180 So.3d 634, 646 (Miss. 2015).

      Moreover, this argument ignores the fact Kimco countered in its answer with its own legal claims.

      In contrast to a derivative action, in a "direct action," an interest holder brings an action on his own behalf "to redress an injury sustained by, or enforce a duty owed to, the holder." Mathis , 25 So.3d at 303. "An action in which the holder can prevail without showing an injury or breach of duty to the corporation should be treated as a direct action that may be maintained by the holder in an individual capacity." Id.


author: RANDOLPH, PRESIDING JUSTICE, FOR THE COURT: KING, JUSTICE, DISSENTING:

text:
    The CITY OF GULFPORT, Mississippi, a Municipal Corporation v. DEDEAUX UTILITY COMPANY, INC.
    NO. 2016-CA-01270-SCT
    Supreme Court of Mississippi.
    February 15, 2018
    JEFFREY S. BRUNI, DUSTIN EUGENE USELTON, MARGARET E. MURDOCK, ATTORNEYS FOR APPELLANT.
    PETER C. ABIDE, JOSEPH WALTER GILL, ATTORNEYS FOR APPELLEE.
    EN BANC.
   RANDOLPH, PRESIDING JUSTICE, FOR THE COURT:

¶ 1. This is the fourth appeal stemming from the City of Gulfport's taking of the Dedeaux Utility Company via eminent domain. The only issue on appeal is whether the interest rate on the judgment is appropriate. Because the trial court failed to follow our mandate to set an interest rate, we reverse and remand for entry of judgment consistent with the evidence presented.

FACTS AND PROCEDURAL HISTORY

¶ 2. In 1996, Gulfport filed an eminent domain complaint against Dedeaux. City of Gulfport v. Dedeaux Util. Co., Inc. , 187 So.3d 139, 140 (Miss. 2016) (" Dedeaux III "). Gulfport did not take physical control of the utility until December 20, 2004, after a jury awarded Dedeaux $3,634,757. Id. Dedeaux appealed that verdict and Gulfport cross-appealed. Dedeaux Util. Co., Inc. v. City of Gulfport , 938 So.2d 838 (Miss. 2006) (" Dedeaux I "). In Dedeaux I , this Court reversed and remanded for a new trial, and the second jury awarded Dedeaux $5,131,676 for the taking. Dedeaux III , 187 So.3d at 140. Dedeaux again appealed, and Gulfport again cross-appealed. Dedeaux Util. Co., Inc. v. City of Gulfport , 63 So.3d 514 (Miss. 2011) (" Dedeaux II "). This Court again reversed and remanded in Dedeaux II , and the case was tried a third time, resulting in a jury verdict in favor of Dedeaux totaling $8,063,981. Dedeaux III , 187 So.3d at 140-41. The jury found that the fair market value of Dedeaux as of December 3, 1996, when the complaint was filed, was $7,082,778. Id . at 141. It found that the fair market value of tangible assets added to Dedeaux from December 3, 1996, to December 20, 2004, when Gulfport took physical control, was $981,203. Id.

¶ 3. Based on payments already made by Gulfport to Dedeaux, the trial court found that Gulfport owed Dedeaux $1,951,102 plus interest on the amount of $7,082,778, and that it owed Dedeaux $728,117 plus interest on the amount of $981,203. Id. Gulfport appealed, and this Court affirmed the trial court on all issues except interest. Id. at 141, 150-51. The trial court had determined that Mississippi Code Section 75-17-1 applied and mandated that it award eight-percent interest. Id. at 148-49. This Court determined that Mississippi Code Section 75-17-7 applied, which charged the trial court to set an interest rate. Id. The Court then remanded "for the limited purpose of determining a reasonable rate of interest and issuing an order for payment of that interest." Id . at 149.

¶ 4. In response to our 2016 remand, Dedeaux filed a motion to set an interest rate. However, in its motion, Dedeaux argued that the trial court should consider rates of return and attached a copy of the S & P Stock Index obtained from the internet to support its argument. At the hearing, Dedeaux argued for rates higher than market interest rates. Alternatively, if the court was going to consider only interest rates, Dedeaux argued the court should compound the interest, despite this Court's prior ruling that simple interest was the law of the case. See Dedeaux I , 938 So.2d at 846 (Miss. 2006) (holding "legal interest" is not compounded, but is, rather, simple interest). Dedeaux offered only one exhibit in support of its argument. The exhibit was used to argue that if an eight-percent rate of interest was used, it would amount to a 4.894 percent rate of return over the entire time period.

¶ 5. Dedeaux's alternative argument remains that the rate of interest should in no event be less than eight percent, as this Court previously has upheld eight percent as being within a judge's discretion, citing non eminent-domain cases and, most critically, time periods outside the suppression of market interest rates by the Federal Reserve. Dedeaux further argued that "an interest rate of higher than eight percent would be fair and reasonable as a prudent investor would have been able to receive a higher rate of return ."

¶ 6. Dedeaux offered no legal authority to the trial court or to this Court to support its argument that courts should enter the speculative investment domain of rates of return on stocks and real estate to supplant the required statutory language of interest rates. See Miss. Code Ann. § 75-17-7 (Rev. 2016) ("All other judgments or decrees shall bear interest at a per annum rate set by the judge hearing the complaint from a date determined by such judge to be fair but in no event prior to the filing of the complaint.") (emphasis added). Both are subject to vastly fluctuating return and often are determined on unrelated market events and timing.

¶ 7. The City agrees that the trial court was charged with determining a rate of interest . To satisfy our mandate, the City offered the only witness at the hearing, Gary Wayne Kelly, Ph.D. Kelly currently serves as Chairman of the Department of Finance, Real Estate, and Business Law at the University of Southern Mississippi, where he teaches undergraduate, graduate, and doctoral-level classes. He has been involved in the study, teaching, and understanding of interest rates for thirty-six years. He received his Master of Economics from Tulane and his Doctorate of Finance and Business Administration in Finance from the University of Alabama. He previously was employed as a professor of finance and economics at Mississippi State University for twenty-four years. He serves as the chairman of a Mississippi federal credit union.

¶ 8. Upon accepting Kelly as an expert witness in finance and economics, the court stated that Kelly would be "allowed to testify as an expert concerning what an interest rate is and what market interest rates are. He will not be allowed to testify as to what the interest rate should be in this case since that is a legal decision to be made by me."

¶ 9. Kelly testified "as a concept, interest is always the rental price of borrowed funds." Kelly testified that an interest rate was "a fee for the rental of funds." Conversely, Kelly defined "rate of return" as "all of the economic changes that happen to a position of an investor, either whether a lender or owner from one point in time to another point in time." In explaining the difference between interest rates and rates of return, Kelly testified that the two could not be "used interchangeably." Kelly not only testified that it would not be proper to use a "so-called average of the S & P 500 for the past twenty years" as a rate of interest, he explained the error of conflating the two.

¶ 10. Kelly testified that he "performed an analysis as to the interest rate that has historically been applied with respect to the City of Gulfport in the financial markets from 1996 ... to the current year." He found that, over a twenty-year period, the City of Gulfport had a "number of bond issues and a number of long-term credit transactions of several types." Kelly testified and offered as part of an exhibit the average long-term financing rates for Gulfport during that time, which was "right about four percent-3.9 to 4.04." He acknowledged some of those transactions had favorable tax advantages for the investors.

¶ 11. Kelly also provided market rates available to the general public by lending institutions and the U.S. Government in a summary of "Selecte[d] Interest Rates 1996-2016." He identified the interest rates for one-year certificates of deposit, five-year certificates of deposit, and ten-year treasury notes over the same interval. For rates of interest on certificates of deposit, Kelly used "the average hundred highest offer rates for CDs of 1 and 5 year maturities. Those are daily offers. So I managed to get every working day's offer rate for CDs...." As to the ten-year treasury notes, Kelly testified that they were issued by the U.S. Treasury with a ten-year maturity.

¶ 12. In its argument to the trial court, the City politely reminded the trial judge of his duty:

Bottom line is the Supreme Court has asked Your Honor to determine the rate of interest and confined it to just that. In terms of that we can understand the Court has got to exercise discretion. And we know that discretion can't be just unfettered and it has to be relying on something.

¶ 13. The trial court commented that he did not believe it was necessary for an expert to tell him what the interest rates were in Mississippi because the trial court knew that interest rates ranged from zero to thirty-six percent. He permitted Kelly to testify only because "[a]nyone can testify to any interest rate anybody gets anywhere...."

¶ 14. The trial court acknowledged that this Court directed him to determine the "applicable interest rate only." He also acknowledged that Dedeaux already had been compensated for the net cash value of its business for a period of twenty years. "So, in effect, they received compensation for the loss of income for that period of time."

¶ 15. Subsequently, the court, sua sponte , marked three documents from the Public Employees' Retirement System of Mississippi ("PERS")-a brochure, the mission statement, and a graph-for the record. Based on the rates of return found in those documents, the trial court opined as follows:

What I did-the first taking was 1996, so I added up the annual rates of return from 1997 to 2014 when the judgment was entered and came up with 147 total. I divided that by 18, which gives an average annual rate of return for those years of 8.17.
On the taking which was in December of 2004, basically the same thing. I started with 2005 through 2014 and came up with 83.90 rate of return . I divided the total rate of return for those years, divided by 10 years of 8.39 percent.
So the Court will find that the Dedeauxs [sic] are entitled to the same rate of return as the 147,000 some odd people in the State of Mississippi that participate in this investment ....

(Emphasis added.) The trial court's exhibit clearly reads that the document pertained to "rates of return[;]" an "average rate of return at 9.16 percent ..., that was lowered to 7.75 percent." The trial court noted that the principal judgment had been paid on May 10, 2016. Therefore, he found interest should stop accruing on that date. The trial court ordered the judgment to be paid within thirty days, and if it was not, the interest would begin accruing again at the aforementioned rate of return of 7.75 percent.

ANALYSIS

¶ 16. The trial court was authorized to grant interest in the instant case by statute. Miss. Code Ann. § 11-27-19 (Rev. 2004). Accordingly, the determination of what legal interest means is a exercise in statutory interpretation and is subject to de novo review. 5K Farms, Inc. v. Miss. Dep't of Revenue , 94 So.3d 221, 225 (¶ 14) (Miss. 2012) ; Page v. Univ. of S. Miss. , 878 So.2d 1003, 1004 (¶ 4) (Miss. 2004). Accordingly, whether or not the trial judge erred in considering the definition of interest rate to encompass evidence of rates of return is subject to de novo review.

¶ 17. Comments by the trial judge during the hearing confirm he erred by considering evidence not offered by either party after he procured evidence, before finding that the rate of return for the state-controlled pension fund (not available to the public) would be the rate of interest for these judgments, as opposed to market rates of interest.

¶ 18. Rates of interest and rates of return are not synonymous terms. See Miss. Code Ann. § 75-17-7 (Rev. 2016) (making no reference to a rate of return). The trial court was mandated with the task "of determining the applicable interest rate and entering an order requiring payment of that interest." Dedeaux III , 187 So.3d at 151 (emphasis added).

¶ 19. While we typically afford great deference to findings of fact, we refrain in this case for multiple reasons-not only did the trial court reject the only admissible evidence presented on interest rates, he also applied an erroneous legal standard in his application of Section 75-17-7 and failed to follow our mandate to set an interest rate.

¶ 20. It was error for the trial court to consider the PERS rate of return. After receiving argument from Dedeaux and the City, exhibits from each bearing on interest rates, and Kelly's testimony, the trial court then discussed the PERS rate-of-return documents he procured and considered sua sponte . Neither party offered those documents. The court then used the PERS rate-of-return documents to set an interest rate. These rate-of-return documents were not relevant to this Court's mandate to set an interest rate. The only evidence on interest rates properly admitted in the record was Dr. Kelly's testimony and the exhibits offered by Dedeaux and the City. There is no support in the record for the trial court's judgment.

¶ 21. In the record before this Court, the highest interest rates properly offered and received into evidence were as follows:

December 3, 1996, through July 25, 2004-6.438 percent;
December 6, 2004, through March 23, 2008-4.274 percent; and
June 2, 2008, until May 10, 2016-4.148 percent.

The trial court rejected the only rates of interest properly introduced.

¶ 22. Cautious investors and courts alike traditionally have followed the bromide that one should be more concerned with the return of capital than with the return on capital. Courts regularly have followed this principle when money is placed in the court's registry. To insure the principal is available for distribution at the appropriate time, courts deposit the funds in local lending and savings institutions, who insure the deposits. Our law instructs courts to consider market interest rates when setting the rate of interest on judgments. "Under the statute, a two- or three-percent interest rate might sometimes be fair and reasonable, while, at other times, market conditions and other relevant factors might require the trial judge to set a higher rate." Bluewater Logistics, LLC v. Williford , 55 So.3d 148, 164 (Miss. 2011). See also Watson v. Watson , 882 So.2d 95, 111 (Miss. 2004) (On remand, the Court instructed the chancellor to reexamine its award of eight-percent interest rate "in light of today's prevailing interest rates."); Brawdy v. Howell , 841 So.2d 1175, 1180 (Miss. Ct. App. 2003) (Court of Appeals held it was not an abuse of discretion or manifest error for the chancellor to set interest at a rate of three percent.).

¶ 23. The trial court's judgment was contrary to the only evidence presented on interest rates. Given that this is the fourth appeal of this case which spans three decades, it is time to end this litigation. The judgment of the trial court is reversed, and this case is remanded for entry of judgment consistent with this opinion and the facts presented at the hearing.

¶ 24. REVERSED AND REMANDED.

WALLER, C.J., COLEMAN, MAXWELL, BEAM, CHAMBERLIN AND ISHEE, JJ., CONCUR. KING, J., DISSENTS WITH SEPARATE WRITTEN OPINION JOINED BY KITCHENS, P.J.

KING, JUSTICE, DISSENTING:

¶ 25. I do not believe the trial court erred in setting the interest rate in this case, particularly given the wide discretion and latitude given trial courts in determining interest. Certainly, rates of return are one of many factors a trial court may consider. Consequently, I dissent.

1. Standard of Review

¶ 26. This Court reviews an award of interest for abuse of discretion. Union Carbide Corp. v. Nix, Jr. , 142 So.3d 374, 385 (Miss. 2014). The majority reviews this issue de novo because it claims that what evidence a trial court may consider in determining an interest rate is a legal issue going to the definition of legal interest. This argument misstates the issue at hand. The trial court did not seek to define "legal interest" as encompassing rates of return, nor did it engage in statutory interpretation. Rates of return were simply one of the pieces of evidence that the trial court considered in making its determination of setting the interest rate. Again, the trial court did not define "interest rate" under the statute; it considered various evidence in setting the interest rate in this case at a certain number. Thus, this is simply not a question of law. This suggestion completely strips a trial court of any discretion. It suggests that this Court must ascertain a finite list of factors or evidence that a trial court may consider in determining an interest rate. We have never so held, nor do the statutes regarding interest rate prescribe or proscribe any certain categories of evidence to be considered. The evidence a trial court may consider in determining an interest rate is within the trial court's discretion, and only an abuse of that discretion warrants reversal.

2. Interest Rate versus Rate of Return

¶ 27. In eminent domain proceedings, "[a]ny judgment finally entered in payment for property to be taken shall provide legal interest on the award ... from the date of the filing of the complaint until payment is actually made; provided, however, that interest need not be paid on any funds deposited by the plaintiff and withdrawn by the defendants prior to judgment." Miss. Code Ann. § 11-27-19 (Rev. 2004). The "legal interest" is an "interest at a per annum rate set by the judge hearing the complaint ...." Miss. Code Ann. § 75-17-7 (Rev. 2016); City of Gulfport v. Dedeaux Util. Co., Inc. , 187 So.3d 139, 149 (Miss. 2016) ( Dedeaux III ). Gulfport argues that the trial court improperly set a "rate of return" instead of an "interest rate," which it asserts violates the statute, violates this Court's limited mandate, and unfairly compensates Dedeaux for future income for which it was already compensated in the jury verdict. The trial court clearly noted that it was allowed to consider rates of return in deciding what interest rate to order. It did not conflate the two with its ruling, but considered rates of return in determining a fair and reasonable interest rate. Moreover, the court indicated that it considered the fact that the jury verdict compensated Dedeaux for lost future income. This issue is without merit.

¶ 28. Gulfport also argues that the only evidence properly before the trial court was the testimony of its expert, thus the trial court could not vary from the evidence before it. For the reasons discussed below, Gulfport's expert was not the only evidence properly before the trial court. Furthermore, Dedeaux argued that an eight-percent rate or more was reasonable because it could have invested the money, and because eight percent had been used in the first two trials without objection from Gulfport. The trial court also indicated that it was considering rates of return in its determination of a fair and reasonable rate, not just the interest rate espoused by Kelly. Kelly also testified in response to a question from the court that a prudent investor would have a diversified portfolio, although he was basing his analysis of interest rates on very conservative investments such as bonds.

¶ 29. This Court has noted that when trial judges "without proof, protest or argument of counsel, or agreement of the parties" continue to award interest at the eight-percent rate previously mandated by statute, this Court is not inclined to address the issue when no objection occurs. Bluewater Logistics, LLC v. Williford , 55 So.3d 148, 164 (Miss. 2011). While this case is not a case in which no proof was offered, if eight percent interest rates based on no proof are not inherently objectionable, the trial court's determination, which simply varied from Gulfport's evidence, was not problematic. The trial court clearly considered multiple factors in coming to its decision.

3. PERS Documentation

¶ 30. Gulfport argues that the court's reliance on PERS documentation violated due process, and that the PERS documentation was inadmissible. Dedeaux argues that Gulfport waived any objection to this evidence, that the evidence was admissible, and that the reliance on the PERS documentation did not violate due process. Gulfport counters that it should not be expected to interrupt a judge during his ruling in order to preserve its objection.

¶ 31. While Gulfport should not be required to interrupt a judge to preserve its objection, the record reveals that Gulfport had ample opportunity after the judge finished ruling to lodge its contemporaneous objection to the PERS documentation. Gulfport did not object, nor did it file a motion for reconsideration, and Gulfport therefore waived this argument. See City of Jackson v. Jordan , 202 So.3d 199, 206 (Miss. 2016)

("If a proper contemporaneous objection is not made, an error is waived."). The majority should not now address it.

¶ 32. The trial court did not abuse its discretion in awarding the interest rate. Further, Gulfport waived any objection to the use of PERS documentation to assist the court in determining an interest rate. I would affirm the trial court's judgment.

KITCHENS, P.J., JOINS THIS OPINION.

      On November 26, 2008, the Federal Reserve launched QE1 (the initial round of quantitative easing), an unconventional method to promote economic growth by purchasing government and/or other securities from the market to lower interest rates and increase the money supply. Quantitative easing artificially suppresses market interest rates. In November 2010, the Federal Reserve announced a second round of QE. A third round was announced in September 2012. A fourth round began in January 2013. The policy ended in 2014.

      "Interest rate" also is defined as "[t]he percentage of an amount of money which is paid for its use for a specified time." Interest rate, Black's Law Dictionary (5th ed. 1979). Quite often, interest rates, such as Prime, set by the Federal Reserve, and LIBOR, the London Interbank Offered Rate, are used as benchmarks by national and local lending institutions, such as banks and savings and loans.

      PERS is defined as a benefit retirement program for employees of the State of Mississippi, and Dedeaux, as a private entity, was not eligible to participate.

      In its Summary of the Argument, the City expressed that the trial court had erred in exercising its discretion but also pointed out the that trial court's ruling was contrary to the applicable statute. The trial court identified the establishment of the interest rate as a legal issue. Seesupra ¶ 8.

      While the interest rates for the one-and five-year certificates of deposit may have been minimally higher for a short period of time, the ten-year U.S. treasury rates provided the overall highest interest rates for the entire time period.

      Trial Exhibit Three provided interest rates for December 1996 and December 2004. The June 2008 rate is an average of December 2007 and December 2008 treasury rates.

      For example, minor settlements. See Miss. Code Ann. § 93-13-17 (Rev. 2013).

      For example, the present interest rates are 1.85 percent for a one-year certificate of deposit, 2.33 percent for a five-year certificate of deposit, and 2.86 percent for a ten-year treasury note. See https://www.bankrate.com/cd.aspx and https://www.treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yield. (Last visited on February 13, 2018).

      Section 1961 of Title 28 of the United States Code was amended in 1982 to remove language allowing the interest rate on federal judgments to be set by "State law" and instead set the interest rates on a formula based on market interest rates. See 28 U.S.C.A. § 1961.

      The majority strips the trial court of its discretion in determining an appropriate interest rate by requiring that the trial judge accept a legal conclusion (the appropriate interest rate) made by a financial expert or a document. But the trial court in its wide discretion may consider any number of factors in determining an interest rate, and it is not required to and should not be required to award an interest rate only if an expert opined it was appropriate or a document stated the final interest rate. The majority allows the trial court to set an interest rate only at an interest rate placed in evidence, rather than considering the interest rates placed in evidence along with a multitude of other factors that may influence the particular case at hand.