Phyllis Maness v. K & A Enterprises of Mississippi, LLC ( 2018 )

IN THE SUPREME COURT OF MISSISSIPPI
NO. 2017-CA-00173-SCT
PHYLLIS MANESS AND JAMES A. MANESS
v.
K & A ENTERPRISES OF MISSISSIPPI, LLC
DATE OF JUDGMENT: 01/05/2017
TRIAL JUDGE: HON. CARTER O. BISE
TRIAL COURT ATTORNEYS: MICHAEL J. CASANO
JIMMY D. McGUIRE
R. WAYNE WOODALL
HAROLD W. DUKE
COURT FROM WHICH APPEALED: HANCOCK COUNTY CHANCERY COURT
ATTORNEY FOR APPELLANTS: JOHN H. DUNBAR
ATTORNEY FOR APPELLEE: NICHOLAS VAN WISER
NATURE OF THE CASE: CIVIL - CONTRACT
DISPOSITION: AFFIRMED - 02/08/2018
MOTION FOR REHEARING FILED:
MANDATE ISSUED:
BEFORE WALLER, C.J., COLEMAN AND CHAMBERLIN, JJ.
CHAMBERLIN, JUSTICE, FOR THE COURT:
¶1. K&A Enterprises of Mississippi, LLC, filed suit against Phyllis and James Maness for
breach of contract. The claim arose from Phyllis and James Maness’s termination of the
Option Contract between the parties. K&A Enterprises of Mississippi, LLC, alleged that
Phyllis and James Maness failed to provide clear title, and in response, Phyllis and James
Maness filed a Counterclaim for Declaratory Judgment. K&A Enterprises of Mississippi,
LLC, filed a Partial Motion for Summary Judgment on Liability, a Partial Motion for
Summary Judgment on Damages, and a Motion to Dismiss the Counterclaim, or in the
alternative, for Summary Judgment. The trial court granted all three motions, denied the
subsequent motions for reconsideration, and the Manesses appealed. For the reasons
expounded upon herein, the Court affirms.
STATEMENT OF FACTS AND PROCEDURAL HISTORY
¶2. Phyllis and James Maness (the Manesses) entered into an Option Agreement for
Purchase of Real Estate (Option Contract) with K&A Enterprises, LLC (K&A) on May 7,
2004. Under the contract, K&A had an option to purchase “Lots 13, 14, 15 and 16, Block
110, GULFVIEW SUBDIVISION, Lakeshore, Hancock County, Mississippi” for $1,000,000
to be paid over a period of time with interest payments, and the option was extended for one
year. The Option Contract also provided a specific subsection on the Manesses’ duty to cure
title defects; it stated:
Cure of Title Defects. Optionors shall have thirty (30) days from notice by the
Optionees of any title defects to cure such defects, unless curative measures
require action by a public entity or a court of law. In that event, the thirty (30)
day limit shall not apply, but Optionors shall be obligated to pursue diligently
and in good faith all necessary filings and application necessary to cure title.
¶3. On April 25, 2005, K&A and the Manesses executed the “Notice of Exercise of
Option,” whereby K&A accepted and exercised the Option Contract. The Notice included
a paragraph stating that K&A was giving notice to the Manesses of the cloud on the title
caused by the inclusion of a piece of the property on a deed with an unrelated party, Eric
Nelson.
2
¶4. On June 15, 2005, Amy Gillespie Smith provided a letter detailing title issues with the
subject property. In the record on appeal, the letter is missing the second page, and K&A
states that it is not in possession of the second page. Regardless, it is clear that the letter
covered two issues that clouded the title. It mentioned the Dynasty Lawsuit and the Walker
Avenue issue. Further, K&A maintains that the subsequent Orgler Report1 makes the Smith
letter clear.
¶5. The Dynasty Lawsuit was filed by the Manesses in 2006 and is styled: Maness v.
Dynasty, Inc., et al. According to the complaint, the lawsuit covered three main issues.
¶6. The first issue is the lack of the “less and except” language in a subsequent deed. In
1998, Dynasty began acquiring property adjacent to Block 110 in the Gulfview Subdivision.
The deed to Dynasty excluded the Manesses’ property2 by including a clause stating that the
property sold was “less and except” the Manesses’ property. Dynasty then conveyed its
property to Eric Nelson. The deed between Dynasty and Nelson failed to contain the “less
and except” provision. Therefore, the deed included the Manesses’ property, and the same
property also is included as part of the property being sold under the Option Contract.
¶7. The second issue in the lawsuit is a cause of action to quiet and confirm title for the
part of the Manesses’ property that was obtained through adverse possession. The adversely
possessed property was generally3 described as the following, “A parcel of land situated in
1
Mark Orgler provided a second title opinion in January 2010, covering the Dynasty
Lawsuit and the Walker Avenue dedication issue.
2
The Maness property was garnered through adverse possession.
3
The complaint also contains the metes-and-bounds description of the property.
3
part of Blocks 110 and 111, GULFVIEW SUBDIVISON, Lakeshore, Hancock County . . .
.” Further a second parcel is described generally4 as the following, “A parcel of land located
in Block 111, GULFVIEW SUBDIVISON, Lakeshore, Hancock County, Mississippi and
also part of Walker Avenue . . . .”
¶8. The third issue in the lawsuit is the Walker Avenue dedication. Walker Avenue was
included on surveys of the Gulfview Subdivision, and it was dedicated to Hancock County.
Subsequently, the Board of Supervisors attempted to vacate the portion of Walker Avenue
that ran through the subdivision. However, it was never done properly because newspaper
publication was required.
¶9. Turning back to the instant suit, due to the “less and except” issue (as covered in the
Dynasty Lawsuit), the Smith title opinion and later two additional title opinions concluded
that it clouded the title. Further, due to the Walker Avenue dedication issue (as covered in
the Dynasty Lawsuit), the Smith title opinion and an additional title opinion concluded that
there was a second cloud on the title.
¶10. On July 15, 2005, the parties entered into a Modification of the Option Contract [July
2005 Modification], whereby they agreed that K&A would stop making interest payments
due to the “lack of clear title.” Further, it provided that the parties understood that the matter
was in litigation, and there was “no merchantable title.” On March 27, 2007, Dynasty Inc.,
Dynasty Limited, Eric Nelson and his company, LSN Nevada Trust, signed a quitclaim deed
4
The complaint also contains the metes-and-bounds description of the property.
4
conveying the “less and except” property to the Manesses. The quitclaim deed did not
address the Walker Avenue dedication issue.
¶11. Thereafter, K&A began making interest payments again. The payments continued
until August 2009. According to K&A, it was eventually discovered that the quitclaim deed
did not fix the title issues. Further, the Manesses continued to litigate the Maness v. Dynasty,
et al. suit. The Manesses then terminated the agreement with K&A on September 8, 2009.
The termination letter stated that “this action is based primarily upon [K&A’s] failure to
remit funds.”
¶12. K&A filed suit against the Manesses on April 21, 2010. They alleged that the
Manesses unilaterally terminated the contract and breached the contract by failing to provide
merchantable title and failing to pursue it diligently, despite K&A’s paying approximately
$479,941.04 over the life of the contract. K&A alleged $479,941.04 in damages. In
response, the Manesses answered and filed a Counterclaim for declaratory relief. The
Counterclaim requested that the court enter a declaratory judgment adjudicating that all
agreements between K&A and the Manesses have been terminated. Further, they alleged that
K&A collected rent, and the declaratory judgment should require K&A to “disgorge any
funds wrongfully withheld by it . . . .”
¶13. K&A filed a Partial Motion for Summary Judgment on Liability, a Motion to Dismiss
the Counterclaim Pursuant to Rule 12 or, in the alternative, for Partial Summary Judgment,
and a Partial Motion for Summary Judgment on Damages. After oral argument on each
motion, the trial court granted all three motions, and denied the Motions for Reconsideration.
5
The cumulative effect of the trial court’s grant of all three motions amounted to a final
disposition regarding all issues of the case. The Manesses appealed.
STATEMENT OF THE ISSUES
¶14. The parties have styled the issues around the three rulings of the trial court: the grant
of partial summary judgment on liability and denial of the motion for reconsideration, the
grant of partial summary judgment on damages and denial of the motion for reconsideration,
and the dismissal of the counterclaim. Due to the volume of arguments made for each ruling
of the trial court, the issues and subissues remain divided by the three rulings of the trial
court.
I. The Motion for Partial Summary Judgment on Liability
(A) Whether K&A, the movant, successfully illustrated
the absence of a genuine issue of material fact as to
liability.
(I) Whether the Option Contract and July 2005
Modification were ambiguous.
(ii) Whether the quitclaim deed cured the title
issues.
(iii) Whether the Manesses’ need to cure had a
deadline.
(iv) Whether the course of conduct of the parties
can be considered.
(v) Whether K&A failed in its burden on
summary judgment.
(B) Whether the trial court abused its discretion in failing
to grant the motion for reconsideration.
6
II. The Motion for Partial Summary Judgment on Damages
(A) Whether K&A, the movant, successfully illustrated
the absence of a genuine issue of material fact as to
damages.
(B) Whether the trial court abused its discretion in failing
to grant the motion for reconsideration.
III. The Dismissal of the Counterclaim under Rule 12.
ANALYSIS
I. The Motion for Partial Summary Judgment on Liability
(A) Whether K&A, the movant, successfully illustrated the
absence of a genuine issue of material fact as to liability.
¶15. On appeal, the grant or denial of a motion for summary judgment is reviewed de novo,
viewing the evidence “‘in the light most favorable to the party against whom the motion has
been made.’” Karpinsky v. Am. Nat’l Ins. Co., 109 So. 3d 84, 88 (Miss. 2013) (quoting
Pratt v. Gulfport–Biloxi Reg’l Airport Auth., 97 So. 3d 68, 71 (Miss. 2012)). Summary
judgment is proper when the “‘pleadings, depositions, answers to interrogatories and
admissions on file, together with the affidavits, if any, show that there is no genuine issue as
to any material fact and that the moving party is entitled to judgment as a matter of law.’”
Karpinsky, 109 So. 3d at 88 (quoting Miss. R. Civ. P. 56(c)).
¶16. The movant bears the burden of persuasion, “persuading the trial judge that: (1) no
genuine issue of material fact exists, and (2) on the basis of the facts established, he is
entitled to judgment as a matter of law.” Karpinsky, 109 So. 3d at 88 (internal quotation
omitted). Further, if at trial, the movant would bear the burden of proof, he also bears the
7
burden of production at summary judgment. Id. However, the nonmovant may not sit ideally
nor “rest upon the mere allegations or denials of his pleadings.” Miss. R. Civ. P. 56(e). The
nonmovant must respond “by affidavit or as otherwise provided in [Rule 56],” and he “must
set forth specific facts showing that there is a genuine issue for trial.” Id. Further, “[i]f he
does not so respond, summary judgment, if appropriate, will be entered against him.” Id.
¶17. Here, K&A bore the burden of persuasion and the burden of production, as it would
bear the burden of proof at trial. See Karpinsky, 109 So. 3d at 88. In support of the Partial
Motion for Summary Judgment on Liability, K&A produced the following documents: the
Option Contract between the parties, the April 25, 2005, Notice to the Manesses of K&A’s
exercise of the option, the Smith Report5 issued in June of 2005, the July 2005 Modification,
the Manesses’ termination of the Option Contract, the Orgler Report, the Manesses’
Response to the Requests for Admissions, the Second Amended Complaint in Maness v.
Dynasty, Inc. et al., and finally, the Motion for Partial Summary Judgment in Maness v.
Dynasty, Inc,. et al. Further, at the hearing, K&A also submitted an expert report of John
Howard Shows.
¶18. In response, at the summary judgment hearing, the Manesses offered the quitclaim
deed that they argued cleared up and removed the cloud from the title. The Manesses then
argued that a number of issues of material fact were left unresolved. On appeal, the
Manesses address some of the arguments made before the trial court, and they raise a couple
5
The Smith Report is two pages long, but it should be three pages long. It is missing
a page, and K&A explained in its brief that this page remains missing but the contents of it
are clear due to the Orgler Report.
8
of new arguments. For clarity and conclusiveness, the arguments of the Manesses are
detailed in the subsections below.
(I) Whether the Option Contract and July 2005
Modification were ambiguous.
¶19. The Manesses argue that the Option Contract and the July 2005 Modification were
ambiguous as to their duty to clear title. This argument was not made at the trial-court level.
Therefore, the Manesses argue that it rises to plain error.
¶20. “This Court has repeatedly held that a trial judge will not be found in error on a matter
not presented to the trial court for a decision.” Purvis v. Barnes, 791 So. 2d 199, 203 (Miss.
2001). Further, “[i]t is well established that this Court does not entertain arguments made
for the first time on appeal as the case must be decided on the facts contained in the record
and not on assertions in the briefs.” Weiner v. Meredith, 943 So. 2d 692, 696 (Miss. 2006)
(internal quotation omitted). However, under the Mississippi Rules of Evidence, when a
substantial right is affected, plain error may be considered by an appellate court. Miss. R.
Evid. 103(f). This means:
The Court will ignore [the] requirement [of] preservation on appeal when a
substantial right is affected. This Court retains the power to notice plain error.
The plain error doctrine reflects a policy to administer the law fairly and justly.
A party is protected by the plain error rule when (1) he has failed to perfect his
appeal and (2) when a substantial right is affected.
State Highway Comm’n of Mississippi v. Hyman, 592 So. 2d 952, 957 (Miss. 1991)
(internal citations omitted). The error also must be a deviation from a legal rule by the trial
court that is plain, clear, obvious, and has prejudiced the outcome of the trial. See McGee v.
State, 953 So. 2d 211, 215 (Miss. 2007). The plain-error doctrine is nearly always applied
9
in the criminal context, but there is no bar to applying it in a civil case. See Alpha Gulf
Coast, Inc. v. Jackson, 801 So. 2d 709, 728 (Miss. 2001); Univ. of Miss. Med. Ctr. v.
Peacock, 972 So. 2d 619, 637 (Miss. Ct. App. 2006).
¶21. “It is a question of law for the court to determine whether a contract is ambiguous and,
if not, enforce the contract as written.” Royer Homes of Miss., Inc. v. Chandeleur Homes,
Inc., 857 So. 2d 748, 751 (Miss. 2003). “If the terms of the contract are subject to more than
one reasonable interpretation,” the contract is considered ambiguous. Id. at 752.
¶22. Here, based on the language of the Option Contract and July 2005 Modification, the
Court holds them to be unambiguous. The Manesses had a duty to provide clear title, and
K&A’s obligation to resume payments was conditioned upon the performance of the
Manesses. Thus, the trial court did not deviate from any legal rule by not addressing the
ambiguity of the contracts because the ambiguity of the contracts was not plain, clear, or
obvious. Further, the outcome of the case is not prejudiced.
(ii) Whether the quitclaim deed cured the title issues.
¶23. Next, the Manesses argue that the quitclaim deed offered proof that they performed
their duty to cure the title issue, and therefore, summary judgment was not warranted. For
the reasons explained below, the Court holds that it is undisputed that the quitclaim deed did
not cure the title issues; therefore, this issue is moot.
10
¶24. First, the Manesses’ response to the First Request for Admission for the instant
case—which was signed well after they terminated the Option Contract in 2009 and well
after the quitclaim deed6—, states the following:
REQUEST NO. 10: Admit that you own the property that is the subject of
Option Agreement for Purchase of Real Estate Attached as Exhibit “A” to the
Complaint.
RESPONSE: Admitted, except for those parcels which are the subject of an
action for Adverse Possession currently before the Chancery Court of
Hancock County, Mississippi.
¶25. It appears the lawsuit the Manesses refer to above is Maness v. Dynasty Inc., et al.
And, completely inapposite to this request-for-admission response, in their reply brief before
the Court, the Manesses argue the following: “[K&A] did not attempt to rebut the Manesses
[’] argument that there is no evidence to dispute their continuous and completed adverse
possession of their land–they have ‘full and complete’ title, for that reason.” Considering
these two points, how can K&A have full and complete title when the Manesses admitted that
they did not even own the property at issue due to adverse possession?
¶26. Requests for admission are governed by Mississippi Rule of Civil Procedure 36. “Any
matter admitted under [Rule 36] is conclusively established unless the court on motion
permits withdrawal or amendment of the admission.” Miss. R. Civ. P. 36. Thus, the
response to the Request for Admission conclusively establishes that the Manesses’ property
at issue in Maness v. Dynasty Inc., et al., is not free or clear or even in existence, which is
troubling.
6
The quitclaim deed was signed in 2007.
11
¶27. Second, aside from the response to the Request for Admission, as argued by K&A,
the Manesses’ representations in Maness v. Dynasty Inc., et al., create an issue of equitable
estoppel. The Manesses filed Maness v. Dynasty Inc., et al., arguing that an action from the
court was required to quiet and confirm title for three reasons: (1) subsequent conveyances
(after the Dynasty deed) failed to exclude the Manesses’ property at issue; (2) adverse
possession of land in part of Blocks 110 and 111; and (3) the Walker Avenue dedication was
not clear whether the rights of the public had been extinguished. Further, the Manesses filed
a Motion for Summary Judgment in Maness v. Dynasty Inc., et al. arguing that the quitclaim
deed7 did not clear the title issues. Further, they pointed out that Dynasty Inc. was not in
existence when it signed the quitclaim deed in 2007, and Dynasty Limited had been dissolved
when it signed the quitclaim deed in 2007. The Manesses concluded that the quitclaim deed
was void and had no effect.
¶28. Yet, despite the issues they outlined in Maness v. Dynasty Inc., et al., on appeal here,
they argue that Maness v. Dynasty Inc., et al., does not affect the title’s merchantability
because the Manesses’ property was excluded under the “less and except” clause and was
never conveyed to Dynasty, and the point of Maness v. Dynasty Inc., et al., was to confirm
their own title, not establish merchantability.
7
The Manesses identified the quitclaim deed in the Dynasty Lawsuit Motion for
Summary Judgment as the quitclaim deed by the grantors (Dynasty, Inc., Dynasty Limited,
Eric L. Nelson, and LSN Nevada Trust) and by the date it was filed (April 5, 2007). This
description matches the quitclaim deed at issue in the instant case. However, the parties
failed to place the exhibits to the Dynasty Lawsuit Summary Judgment Motion in the instant
record on appeal.
12
¶29. “[E]quitable estoppel may be enforced in those cases in which it would be
substantially unfair to allow a party to deny what he has previously induced another to
believe and take action on.” PMZ Oil Co. v. Lucroy, 449 So. 2d 201, 207 (Miss. 1984).
Equitable estoppel is a rule rooted in equity that derives from the “[f]raudulent intent to
mislead.” Id. However, fraud is not required for equitable estoppel to be applied. Id.
¶30. In Maness v. Dynasty Inc., et al., the Manesses themselves argued that an order from
the court was needed to quiet and confirm title. K&A then relied upon the Manesses’
argument to their detriment because the Manesses then terminated the Option Contract. The
Manesses cannot now argue that there was never a cloud on the title, or that the title was
merchantable. The Court holds that they are equitably estopped from claiming that the
quitclaim deed fixed the issues and that the title was merchantable.
¶31. Third, K&A provided two title reports —the Orgler Report and the Smith Letter—
and an expert report—The John Howard Shows Expert Report—to the trial court detailing
title issues. The two title reports and the expert report were considered by the Court, and the
Manesses did not object to entering them into evidence. In their brief, the Manesses state
that the reports were valid summary-judgment evidence,8 but they take issue with the content
of the reports, arguing that the reports failed to contain a legal test. Further, with regard to
the Walker Avenue dedication issue, the Manesses argue that the expert reports fail to show
8
Therefore, the Court need not consider whether the expert report and the title reports
were presented in the correct form for summary-judgment evidence. See Hill v. Consumer
Nat’l Bank, 482 So. 2d 1124, 1128 (Miss. 1986) (considering the specific evidence allowed
for summary judgment, stating that it must be “facts sworn to on personal knowledge in
depositions, answers to interrogatories or affidavits . . . ”).
13
a genuine issue, as they fail to address the abandonment of the dedication, nonuse of the road,
and failure of it to appear on the official road system.
¶32. All three reports address the issue of successive deeds failing to exclude the Maness
property at issue, and all three reports conclude that the title was not clear or merchantable.
Specifically, the Orgler Report and the Smith Letter address the Walker Avenue issue, as
well. Further, the Shows Report notes that Dynasty, Inc., was not a validly formed
Mississippi corporation until 2010, and Dynasty Limited was dissolved in 2003.9
¶33. The Manesses unambiguously were bound by the Option Contract and the July 2005
Modification to cure title defects. The expert reports established that all of the defects were
not cured by the quitclaim deed, and the Manesses failed to file anything to contradict the
reports, specifically a competing expert report or a Daubert10 motion challenging the reports.
See Miss. R. Civ. P. 56(e) (The nonmovant may not sit idly nor “rest upon the mere
allegations or denials of his pleadings.”).
¶34. Finally, throughout their brief, specifically in regard to the effect of the quitclaim
deed, the Manesses maintain that the title was merchantable. They state that it was
merchantable because a “title insurer would except [sic] the [t]itle [q]uestions.” Further, they
state that a “stranger to the chain-of-title” does not render the title unmerchantable. This
argument also fails. The three title reports (to which the Manesses failed to properly
respond) conclude that the defects made the property unmerchantable. But, more
9
The quitclaim deed was signed by both companies in 2007.
10
Daubert v. Merrell Dow Pharm., Inc., 509 U.S. 579, 113 S. Ct. 2786, 125 L. Ed.
2d 469 (1993).
14
importantly, the Manesses were bound by the Option Contract and the July 2005
Modification to cure the title defects, and it is undisputed that the quitclaim deed did not cure
the title defects. A failure to cure constitutes a material breach. Ferrara v. Walters, 919 So.
2d 876, 883 (Miss. 2005).
¶35. Thus, based on the response to the Request for Admission, equitable estoppel, the
expert reports, and the plain language of the Option Contract and July 2005 Modification,
the quitclaim deed does not create a genuine issue of material fact. It is undisputed that the
quitclaim deed did not cure the title issues, and therefore, the instant issue is moot.
(iii) Whether the Manesses’ need to cure had a deadline.
¶36. The Manesses also argue that their performance never had a deadline; therefore, there
is no proof they breached. This argument once again was not brought before the trial court.
Therefore, it must rise to the level of plain error to be considered or appeal, and it fails. As
stated above, when the Manesses terminated the Option Contract, a cloud still existed on the
title. Therefore, any argument that the Manesses did or did not cure the title issues on time
is immaterial and moot.
(iv) Whether the course of conduct of the parties
precludes summary judgment.
¶37. As they argued before the trial court, the Manesses also contend that the course of
conduct of the parties should be considered as proof that the quitclaim deed cleared the title
issue because, after the quitclaim deed, K&A made payments to the Manesses before
stopping again. The Manesses point to the following rule for this argument:
15
(W)hen the parties have for some time proceeded with or under the deed or
contract, a large measure, and sometimes a controlling measure, of regard will
be given to the practical construction which the parties themselves have given
it, this on the common sense proposition that actions generally speak even
louder than words.
Moore v. Kuljis, 207 So. 2d 604, 612 (Miss. 1967) (quoting Sumter Lumber Co. v. Skipper,
184 So. 296, 298 (Miss. 1938)).
¶38. The course-of-conduct argument fails as a matter of law for a number of reasons.
First, the Manesses failed to present any evidence that there was a course of conduct after the
quitclaim deed. At oral argument, they asked the judge to deny summary judgment to allow
them to present such evidence. They stated: “And so for that, again, I believe that there is
an issue there that we should be able to put on proof that shows the course of conduct
between the parties indicated that they were continuing under the terms of that agreement .
. . .” However, at the summary-judgment stage, once again, they brought forth no proof, only
argument of counsel. See Miss. R. Civ. P. 56(e) (The nonmovant may not sit idly nor “rest
upon the mere allegations or denials of his pleadings.”).
¶39. Second, the rule cited by the Manesses as support for their course-of-conduct
argument arises from a contract that was held to be ambiguous. The Skipper Court
specifically stated that “[w]hen the language of the deed or contract is clear, definite, explicit,
harmonious in all its provisions, and free from ambiguity throughout, the court looks solely
to the language used in the instrument itself, and will give effect to each and all its parts as
written.” Skipper, 184 So. at 298; see also Heritage Cablevision v. New Albany Elec. Power
Sys. of City of New Albany, 646 So. 2d 1305, 1313 (Miss. 1994) (“Only if the contract is
16
unclear or ambiguous can a court go beyond the text to determine the parties’ true intent.”).
Thus, the actions of the parties are considered only if the contract is ambiguous.
¶40. Here, the Option Contract and July 2005 Agreement are held to be unambiguous.
Therefore, the Skipper rule does not apply. Further, it is worth noting that it is clearly
inequitable to render a quitclaim deed with the intent to restart K&A’s payments, when the
quitclaim deed, although it purported to fix the title issues, never fixed them.
(v) Whether K&A failed in its burden on summary judgment.
¶41. The Manesses finally conclude that they “had no burden to produce any evidence
against the motion for partial summary judgment, unless and until [K&A] had shown the
absence of a genuine issue on every essential element of the Plaintiff’s claim . . . .” The
Manesses fail to point out the “essential element[s]” that K&A fails to address, and the Court
holds no elements to be missing.
¶42. A breach-of-contract case has two elements: (1) “the existence of a valid and binding
contract,” and (2) a showing “that the defendant has broken, or breached it.” Bus.
Commc’ns, Inc. v. Banks, 90 So. 3d 1221, 1224 (Miss. 2012).11 “A breach is material where
there is ‘a failure to perform a substantial part of the contract or one or more of its essential
terms or conditions, or if there is such a breach as substantially defeats [the purpose of the
contract].’” Ferrara v. Walters, 919 So. 2d 876, 886 (Miss. 2005) (quoting Gulf South
Capital Corp. v. Brown, 183 So. 2d 802, 805 (Miss. 1966)). In Ferrara, the sellers failed
to cure a title issue and then terminated the contract with the original buyer. Ferrara, 919
11
Monetary damages are not an element of a breach-of-contract claim, but a remedy
for breach of contract. Banks, 90 So. 3d at 1225.
17
So. 2d at 880. The Court held in favor of the buyer, stating that the sellers were bound “to
correct the defects in title and to render to [the buyer] that which he bargained for under the
contract . . . .” Id. at 886. Specifically, it held that “where a contract expressly provides a
reasonable opportunity for the seller to cure discovered defects in title, the seller’s failure to
cure constitutes a material breach of the contract.” Id. at 883.
¶43. Here, there is no issue that the Option Contract was a valid and binding contract.
Further, at the time that the Manesses unilaterally terminated the contract, they had not cured
the title issue. Therefore, like in Ferrara, the Manesses had a duty to provide clear title, and
they could not terminate the contract, having failed to uphold their end of the contract. Thus,
they were in material breach at the time of the termination for failing to provide clear title,
and there are no “essential elements” missing from K&A’s summary-judgment argument.
¶44. In summary, K&A, the movant, successfully illustrated the absence of a genuine issue
of material fact as to liability. K&A presented enough evidence to sustain its burden of
persuasion and production and show that, at the time of termination, the Manesses had failed
to cure the title issue that was required under the Option Contract and under the July 2005
Modification. In response, the Manesses presented only the quitclaim deed. The quitclaim
deed did not create a disputed issue of material fact, because the evidence presented by K&A
and the record before the Court unequivocally establish that the quitclaim deed failed to cure
all of the title issues. Specifically, the pleadings from Maness v. Dynasty Inc., et al., the
Manesses’ own response to the Request for Admission, and three title reports proved that the
quitclaim deed was inadequate to cure the title issues. If the Manesses needed more time for
18
discovery, they should have made such a motion, but the record does not contain a motion
for additional time to conduct discovery. Therefore, the Manesses failed in their burden on
summary judgment, and the Court affirms the trial court’s grant of the Partial Motion for
Summary Judgment on Liability.
(B) Whether the trial court abused its discretion in failing to
grant the motion for reconsideration.
¶45. The Manesses argue that the trial judge erred by considering their “Motion to Strike
the Order Granting Plaintiff’s Motion for Partial Summary Judgment” as a Rule 59(e)
motion, instead of a Rule 54(b) Motion for Reconsideration. See Miss. R. Civ. P. 54(b),
59(e). The Manesses cite a recent Fifth Circuit opinion to argue that a Rule 54(b) motion is
the correct standard when not all of the claims have been disposed of by the original motion,
for which the reconsideration is sought. Cabral v. Brennan, 853 F.3d 763, 766 (5th Cir.
2017). K&A maintains that the Manesses utterly failed to bring forth any probative evidence
refuting the evidence submitted by K&A.
¶46. The grant or denial of a motion for reconsideration is reviewed under an abuse-of-
discretion standard. City of Jackson v. Internal Engine Parts Grp., Inc., 903 So. 2d 60, 66
(Miss. 2005) (“Review of a trial judge’s denial of a Rule 59 motion is limited to abuse of
discretion.”). For the reasons stated below, the Court holds that the trial judge did not abuse
his discretion in denying the Motion for Reconsideration.
¶47. Cabral is based on the Federal Rules of Civil Procedure, and the Cabral Court found
that the difference between a Rule 59 motion or a Rule 54 motion was harmless. It held that
Rule 59 carried a “standard more exacting” than that of Rule 54. Cabral, 853 F.3d at 766.
19
Therefore, filing a motion under Rule 59 encompasses the standard of filing a motion under
Rule 54, and it is not reversible error.
¶48. Further, the Manesses’ actions illustrate that they intended their motion to be a Rule
59 motion. They originally styled the motion as a Motion to Strike the Order, but then they
later filed a “Supplement Motion for Reconsideration.” (Emphasis added.) The supplement
illustrates that the Manesses’ original motion was filed under Rule 59.
The trial court found in his Order denying the motion that the Manesses failed
to present any evidence to this Court to create a genuine issue of material fact
regarding the Defendant’s breach of the contract. Nothing before the Court on
reconsideration demonstrates an intervening change in controlling law, the
availability of new evidence not previously available, or need to correct a clear
error of law or prevent manifest injustice.
Upon the Court’s review of the record and the arguments on appeal, the trial judge did not
abuse his discretion in denying the motion for reconsideration. Internal Engine Parts Grp.,
Inc., 903 So. 2d at 66. The Manesses presented nothing that satisfied any of the grounds for
the motion for reconsideration to be granted. The Manesses merely wanted another bite at
the apple, which is not the point of a motion for reconsideration.
II. The Motion for Partial Summary Judgment on Damages
(A) Whether K&A, the movant, successfully illustrated
the absence of a genuine issue of material fact as to
damages.
¶49. As stated above, the grant or denial of a motion for summary judgment is reviewed
de novo. Karpinsky, 109 So. 3d at 88. Further, here, the movant bears the burden of
“persuading the trial judge that: (1) no genuine issue of material fact exists, and (2) on the
basis of the facts established, he is entitled to judgment as a matter of law,” and production.
20
Id. (internal quotation omitted). In response, the nonmovant must respond, “by affidavit or
as otherwise provided in [Rule 56],” and he “must set forth specific facts showing that there
is a genuine issue for trial.” Miss. R. Civ. P. 56. Further, “[i]f he does not so respond,
summary judgment, if appropriate, will be entered against him.” Id.
¶50. In support of its Partial Motion for Summary Judgment on Damages, K&A submitted
the Second Request for Admissions that it had propounded to the Manesses, and the
Manesses had not timely answered. K&A argued that the Second Requests for Admission
was, therefore, deemed admitted. The Second Requests for Admission covered the amounts
paid by K&A to the Manesses under the Option Contract. K&A also submitted copies of the
checks and a handwritten log of payments. The amount came to $457,435.52. The Manesses
filed a response arguing that “[s]imply because [the] Second Requests for Admissions were
not timely answered and deemed admitted, does not necessarily make the facts alleged
therein true.” Further, they filed no additional documents in the form of affidavits or
otherwise in support of their arguments. Specifically, they filed nothing in support of their
argument that the nature of the payments was in question.
¶51. The trial court held that the Requests for Admission were deemed admitted under Rule
36 of the Mississippi Rules of Civil Procedure, and it pointed out that requests for admission
had been recognized as a means to establish causation and damages. Further, in granting the
Partial Motion for Summary Judgment on Damages, it noted that the Manesses had failed
to produce anything to support their arguments.
21
¶52. On appeal, the Manesses make three arguments that the Motion for Partial Summary
Judgment on Damages should not have been granted. First, the Manesses cite ARD, LLC v.
Trulite Glass & Aluminum Sols., LLC, 195 So. 3d 867, 871-72 (Miss. Ct. App. 2016), to
argue that the Requests for Admission are insufficient to prove the payments were caused by
the alleged breach. K&A argues that the deemed-admitted Requests for Admission
conclusively established the appropriate amount of damages under the remedy of recession
of the contract.
¶53. In ARD, LLC, the issue was whether a relationship of privity existed between the
party seeking damages and the party from whom damages were sought. That is not an issue
in the instant case; therefore, ARD, LLC is not applicable. ARD, LLC, 195 So. 3d at 871-72.
Further, monetary damages are a remedy for breach of contract, not an element of it. Banks,
90 So. 3d at 1225.
¶54. The Manesses next argue that K&A failed to establish conclusive proof of the
damages by providing mere proof of the payments. K&A argues that the Manesses failed to
present any evidence to contradict the evidence presented by K&A.
¶55. As discussed in the sections above, the grant of the Partial Summary Judgment on
Liability inherently established a material breach. The remedy can come in the form of
specific performance or monetary damages. The Court has expressed restraint in allowing
parties to exercise termination of a contract. Ferrara v. Walters, 919 So. 2d 876, 886 (Miss.
2005) (“Absent other lawful reasons why the contract should not be enforced, we conclude
that the parties are bound to perform pursuant to the terms of their agreement.”); see also
22
UHS-Qualicare, Inc. v. Gulf Coast Cmty. Hosp., Inc., 525 So. 2d 746, 756 (Miss. 1987)
(“Termination is permitted only for a material breach.”). However, the Court has expressed
general acceptance of monetary damages as a remedy. Banks, 90 So. 3d at 1225 (“Monetary
damages are a remedy for, not an element of, breach of contract.”). Further, the Court has
stated:
[T]he Court’s purpose in establishing a measure of damages for a breach of
contract is to put the injured party in the position where she would have been
but for the breach. However, this Court has never contemplated that an injured
party be placed in a better position than she would have been had the contract
been performed.
Wilson v. Gen. Motors Acceptance Corp., 883 So. 2d 56, 66 (Miss. 2004) (internal quotation
omitted).
¶56. Here, the termination of the contract and monetary damages were the correct remedy.
When the Manesses terminated the Option Contract, they were in material breach, because
a cloud still existed on the title, and based upon the record before the Court, the cloud on the
title still remains today. Thus, due to the material breach, the court’s termination of the
contract and award of monetary damages was appropriate. See UHS-Qualicare, Inc., 525
So. 2d at 756. Further, the damages awarded represent the exact amount of money paid by
K&A in the form of purchase price and interest payments over the life of the contract:
$457,435.52. This, in the face of a contract termination, is the correct amount of monetary
damages. The damages should be the amount that would place the nonbreaching party “in
the position where [it] would have been but for the breach,” no more and no less. Wilson,
23
883 So. 2d at 66. Thus, without any evidence from the Manesses to the contrary, the money
paid by K&A under the contract conclusively established damages.
¶57. Lastly, the Manesses again make the course-of-conduct argument. This argument is
without merit, because, as stated supra on the Motion for Partial Summary Judgment on
Liability, the Manesses’ Option Contract and July 2005 Modification were unambiguous.
Therefore, the course of conduct of the parties is not considered.
¶58. Thus, for all of the above-described reasons, the Court affirms the grant of the Partial
Motion for Summary Judgment on Damages. K&A conclusively established its form and
amount of damages, and the Manesses failed to uphold their burden of presenting any proof
in response.
(B) Whether the trial court abused its discretion in failing to
grant the motion for reconsideration.
¶59. The Manesses filed a Motion to Reconsider Order Granting Plaintiff’s Motion for
Summary Judgment on Damages, and the trial court denied it. In their brief, the Manesses
bring forth the same arguments they made in the Motion for Reconsideration regarding the
Partial Motion for Summary Judgment on Liability. Thus, for the same reasons detailed
above, the chancellor did not abuse his discretion in denying the motion to reconsider.
Specifically, Rule 59 of the Mississippi Rules of Civil Procedure offers an appropriate
standard for a motion for reconsideration, and the Manesses wholly failed to present any
evidence in the form of affidavits or otherwise regarding their claims as to why the Partial
Motion for Summary Judgment on Damages should be denied. See Cabral, 853 F.3d at 766;
see also Miss. R. Civ. P. 56(e).
24
III. The Dismissal of the Counterclaim under Rule 12
¶60. Like review of a Motion for Summary Judgment, the grant or denial of a Motion to
Dismiss under Rule 12 raises an issue of law and is reviewed de novo. Richardson v. Sara
Lee Corp., 847 So. 2d 821, 823 (Miss. 2003). “When considering a motion to dismiss, the
allegations in the complaint must be taken as true, and the motion should not be granted
unless it appears beyond doubt that the plaintiff will be unable to prove any set of facts in
support of his claim.” Cook v. Brown, 909 So. 2d 1075, 1077–78 (Miss. 2005) (internal
quotation omitted). Further, it must be that no set of facts would entitle the opposing party
to relief. Lowe v. Lowndes Cty. Bldg. Inspection Dep’t, 760 So. 2d 711, 712 (Miss. 2000).
¶61. The counterclaim requested that the court enter a declaratory judgment adjudicating
that all agreements between K&A and the Manesses had been terminated. Further, the
Manesses alleged that K&A collected rent and that the declaratory judgment should require
K&A to “disgorge any funds wrongfully withheld by it . . . .”
¶62. K&A argued before the trial court that the agreement at issue in the counterclaim,
whereby rents were exchanged, was not provided to the court, as required under Rule 10(d)
of the Mississippi Rules of Civil Procedure. Further, K&A argued that the Manesses failed
to state a claim against it because it was not a party to the contract for which the rents
described in the counterclaim were exchanged. K&A stated that the agreement for which
rents were exchanged was between A&H Management, LLC, and the Manesses. The
Manesses responded that their counterclaim added “as Counter Defendants Arthur Geary and
Lester J. Waldmann and A&H Management, LLC.” Further, they filed a Motion to Allow
25
Defendants[’] Compulsory Counterclaim that they never brought to hearing or pursued a
ruling on.12 The trial court granted the motion to dismiss, citing Rule 10(d) of the Mississippi
Rules of Civil Procedure and citing the Manesses’ failure to include specific agreements
under Rule 12(b)(6) of the Mississippi Rules of Civil Procedure.
¶63. On appeal, K&A argues that the determinations under the Partial Motions for
Summary Judgment made the counterclaim moot as to the requested declaratory judgment
that all agreements have been terminated. Further, it argues that it was not a party to the
additional claims regarding the rents; therefore, dismissal was proper. The Manesses argue
their failure to attach the contract at issue for the rent to their complaint was not fatal to their
claim.
¶64. The Motions for Partial Summary Judgment addressed breach and termination of the
agreements between the parties. Therefore, the Motions for Partial Summary Judgment
rendered the claims for declaratory judgment moot.
¶65. Further, the Manesses are correct that refusal to attach the contract at issue to their
complaint is no longer fatal. See 3M Co. v. Glass, 917 So. 2d 90, 92-94 (Miss. 2005);
Crawford v. Butler, 924 So. 2d 569, 576 (Miss. Ct. App. 2005). However, this does not save
their counterclaim. The Manesses admitted that the party at issue in the agreement, for which
rents were exchanged, was not K&A. The Court cannot maintain a contract action against
someone who is not a party to the action or in privity with it. Burns v. Washington Savings,
171 So. 2d 322, 324 (Miss. 1965) (“It is a general rule of the law of contracts that in order
12
The Motion to Allow Defendants[’] Compulsory Counterclaim is not an issue on
appeal.
26
to maintain an action to enforce the breach of a contract, or to recover damages growing out
of the breach, or for failure to carry out the terms of the contract, it is ordinarily a necessary
prerequisite that the relationship of privity of contract exist between the party damaged and
the party sought to be held liable for the breach of the contract.”). Thus, because K&A was
not a party to the purported agreements for which rents were owed and the declaratory
judgment sought is moot, the Court affirms the trial court on its grant of the Motion to
Dismiss.
CONCLUSION
¶66. The trial court correctly granted the Partial Motion for Summary Judgment on
Liability, the Motion to Dismiss Portion of Counterclaim Pursuant to Rule 12 or, in the
alternative, for Partial Summary Judgment, and the Partial Motion for Summary Judgment
on Damages. Further, the trial court correctly denied both motions for reconsideration.
Thus, the Court affirms the judgment of the trial court.
¶67. AFFIRMED.
WALLER, C.J., KITCHENS, P.J., KING, COLEMAN AND BEAM, JJ.,
CONCUR. MAXWELL, J., SPECIALLY CONCURS WITH SEPARATE WRITTEN
OPINION JOINED BY WALLER, C.J., COLEMAN, BEAM AND ISHEE, JJ.
RANDOLPH, P.J., NOT PARTICIPATING.
MAXWELL, JUSTICE, SPECIALLY CONCURRING:
¶68. I write separately to address the Manesses’ so-called motions “for reconsideration.”
While a harmless issue here, this case illustrates the confusion often created by such motions.
¶69. Technically, “[t]he Mississippi Rules of Civil Procedure do not provide for a motion
for reconsideration.” McBride v. McBride, 110 So. 3d 356, 359 (Miss. Ct. App. 2013). Rule
27
54(b) does makes clear that a decision, order, or judgment that disposes of less than all
claims by all parties is interlocutory and therefore “is subject to revision at any time before
the entry of judgment adjudicating all the claims and the rights and liabilities of all the
parties.” Miss. R. Civ. P. 54(b). But once a judgment becomes final, the trial court loses its
inherent “free[dom] to reconsider and reverse its decision for any reason it deems
sufficient[.]” Cabral v. Brennan, 853 F.3d 763, 766 n.3 (5th Cir. 2017) (quoting Lavespere
v. Niagara Mach. & Tool Works, Inc., 910 F.2d 167, 185 (5th Cir. 1990), abrogated on
other grounds, Little v. Liquid Air Corp., 37 F.3d 1069, 1075 n.14 (5th Cir. 1994) (en banc)).
¶70. Instead, the trial court’s power to modify a final judgment is limited by Rules 59
and 60. See Miss. R. Civ. P. 59, 60. Under Rule 59, the trial court may grant a new trial or
alter the judgment “if convinced that a mistake of law or fact has been made, or that injustice
would attend allowing the judgment to stand.” McNeese v. McNeese, 119 So. 3d 264, 272
(Miss. 2013). The trial court may also grant a new trial under Rule 59(a) based on newly
discovered evidence. Id. Under Rule 60(a), the trial court may correct “[c]lerical mistakes
in judgments, orders, or other parts of the record and errors therein arising from oversight or
omission . . . .” Miss. R. Civ. P. 60(a). And under Rule 60(b), a trial court, upon motion,
“may relieve a party or his legal representative from a final judgment, order, or proceeding
for the following reasons”:
(1) fraud, misrepresentation, or other misconduct of an adverse party;
(2) accident or mistake;
(3) newly discovered evidence which by due diligence could not have been
discovered in time to move for a new trial under Rule 59(b);
28
(4) the judgment is void;
(5) the judgment has been satisfied, released, or discharged, or a prior
judgment upon which it is based has been reversed or otherwise vacated, or it
is no longer equitable that the judgment should have prospective application;
(6) any other reason justifying relief from the judgment.13
Miss. R. Civ. P. 60(b).
¶71. To be granted any of the above relief requires more than mere “reconsideration.” Yet
over the years, Mississippi practitioners have filed a slew of post-trial motions generically
titled “motions to reconsider.” McBride, 110 So. 3d at 359-60. And once filed, courts are
left to decipher what type of motion is actually being filed based on the timing and the
substance of the request. A Rule 54(b) motion to revise an interlocutory order? A Rule 59(e)
motion to alter or amend a final judgment? A Rule 59(a) motion for a new trial? A Rule
60(a) motion to correct an omission or clerical mistake? Or a Rule 60(b) motion for relief
from a final judgment? See, e.g., City of Jackson v. Jackson Oaks Ltd. P’ship, 792 So. 2d
983, 984-85 (Miss. 2001) (holding that the trial court erred by failing to treat a party’s post-
judgment motion, which was filed after the time limitation to file a Rule 59(e) motion, as a
Rule 60(b) motion); Woods v. Victory Mktg., LLC, 111 So. 3d 1234, 1236 (Miss. Ct. App.
2013) (“The timing of the motion for reconsideration determines whether it is a Rule 59 or
Rule 60(b) motion.”).
13
Though, at first blush, Rule 60(b)(6) could be construed as empowering trial courts
to reconsider their prior judgments for “any other reason,” we have been clear that “[r]elief
under Rule 60(b)(6) is reserved for extraordinary and compelling circumstances. Briney v.
U.S. Fid. & Guar. Co., 714 So. 2d 962, 966 (Miss. 1998) (citations omitted).
29
¶72. That is exactly what the chancellor had to do here. Faced with a “Supplemental
Motion to Reconsider” and a “Motion to Reconsider,” it is understandable that the chancellor
treated the Manesses’ motion as a Rule 59(e) motion to alter or amend given that they put
forth the reasons for granting a Rule 59(e) motion as justification for setting aside the grants
of partial summary judgment. But, as the Manesses point out on appeal, a partial grant of
summary judgment is a nonfinal order. And under Rule 54(b), the trial court may always set
aside a nonfinal decision for any reason it deems just. Cabral, 853 F.3d at 766 n.3 (“[T]he
higher standard in Rule 59(e) reflects the fact that judgment has already been entered, while
the ‘more flexible’ Rule 54(b) standard reflects the district court’s inherent power to grant
relief from interlocutory orders ‘as justice requires.’” (quoting Cobell v. Jewell, 802 F.3d 12,
25-26 (D.C. Cir. 2015))).
¶73. So the Manesses are right. The trial judge could have “reconsidered” his interlocutory
decision to grant partial summary judgment without requiring the Manesses to meet the more
“exacting” standard of Rule 59(e). Cabral, 853 F.3d at 766. But in this case, I fail to see
how the motion misidentification prejudiced the Manesses. Like the appellants in the case
they rely on, Cabral, the Manesses “do[] not explain how [they] could have been harmed by
the procedural error.” Id. Beyond pointing out the trial court applied a more rigorous Rule
59(e) standard to a Rule 54(b) motion, they fail to demonstrate how the trial court’s applying
the correct standard would have led to a different outcome. Indisputably, K&A were entitled
to summary judgment on the issues of liability and damages. So the trial court could hardly
be held in error for refusing to revisit these decisions prior to their becoming final.
30
¶74. Here, the Manesses’ using the Rule 59(e) standard to argue a Rule 54(b) motion led
to harmless procedural error. But that may not hold true for every so-called “motion for
reconsideration.” Motions for relief under Rules 54(b), 59(a), 59(e), 60(a), and 60(b) are not
interchangeable. And courtroom lawyers would be wise not only to appreciate the
differences between these rules but also label their motions according to the precise relief
they seek.
WALLER, C.J., COLEMAN, BEAM AND ISHEE, JJ., JOIN THIS OPINION.
31