Ground Control, LLC v. Capsco Industries, Inc.

120 So. 3d 365, 2013 WL 2436665, 2013 Miss. LEXIS 327
CourtMississippi Supreme Court
DecidedJune 6, 2013
DocketNo. 2011-IA-00928-SCT
StatusPublished
Cited by22 cases

This text of 120 So. 3d 365 (Ground Control, LLC v. Capsco Industries, Inc.) is published on Counsel Stack Legal Research, covering Mississippi Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ground Control, LLC v. Capsco Industries, Inc., 120 So. 3d 365, 2013 WL 2436665, 2013 Miss. LEXIS 327 (Mich. 2013).

Opinions

WALLER, Chief Justice,

for the Court.

¶ 1. Ground Control, LLC, seeks review of summary judgment granted in favor of Capsco Industries and other defendants. The circuit court held in part that Ground Control’s failure to obtain a certifícate of responsibility, as required by Mississippi Code Section 31-3-15, rendered its construction contract with Capsco null and void. While we affirm the court’s finding that the lack of certificates of responsibility rendered the parties’ contract null and void, we reverse the grant of summary judgment in part and remand this case for further proceedings on whether Ground Control is entitled to recover based on claims of unjust enrichment and quantum meruit. We also reverse the grant of summary judgment in favor of Harrah’s and Yates because of inadequate notice of the conversion from a motion to dismiss to a motion for summary judgment.

FACTS AND PROCEEDINGS BEFORE THE TRIAL COURT

¶ 2. The plaintiff and counter-defendant below, Ground Control, LLC, an Alabama corporation, entered into a contract with Capsco Industries, Inc., also an Alabama corporation, to perform construction on the “Margaritaville Spa and Hotel” in Biloxi, on behalf of Harrah’s Entertainment, Inc. W.G. Yates and Sons Construction Company served as the general contractor. Capsco was employed as a subcontractor, and Capsco subcontracted in-ground construction work to Ground Control.

¶ 3. Capsco entered into its contract with Ground Control on December 19, 2007; neither Yates nor Harrah’s was a party to the contract. Ground Control was to perform work related to in-ground installation of water, sewage, and storm-drain lines. It is undisputed that neither party obtained a certificate of responsibility as required by Mississippi Code Section 31 — 3— 21. Ground Control worked on the project until October 28, 2008, when Yates terminated it from the project for alleged safety violations and failed drug tests of its employees.

¶ 4. On August 25, 2009, Ground Control filed its complaint against the defendants in Harrison County Circuit Court. On December 4, 2009, Capsco counterclaimed and filed a third-party claim against Ground Control’s president, Frank Beaton, alleging that Ground Control breached the contract and that Beaton had committed acts of fraud. On December 8, 2009, Har-rah’s and Yates jointly moved to dismiss for lack of privity. On December 29, 2009, Ground Control filed a supplemental complaint alleging various extracontractual claims. On January 2, 2012, Capsco filed a motion for summary judgment, and a hearing subsequently was held on Harrah’s and Yates’ joint motion to dismiss as well as Capsco’s motion for summary judgment. On April 4, 2011, the trial court granted summary judgment to Capsco and to Har-rah’s and Yates, even though the latter two jointly had moved to dismiss and not for summary judgment. The record shows that Ground Control never received notice that Yates’ and Harrah’s motion to dismiss would be converted to a motion for summary judgment until the trial court issued [368]*368its order granting summary judgment. Ground Control timely filed this appeal.

DISCUSSION

¶ 5. This Court applies a de novo standard of review to a circuit court’s grant or denial of summary judgment. Kilhullen v. Kan. City S. Ry., 8 So.3d 168, 174 (Miss.2009). Upon review, this Court must view the evidence “in the light most favorable to the party against whom the motion has been made.” Id. (quoting Daniels v. GNB, Inc., 629 So.2d 595, 599 (Miss.1993)).

¶ 6. On appeal, Ground Control asks the court to consider multiple issues pertaining to the three defendants. Because some of the issues are very closely related to one another, we have consolidated the arguments for the sake of clarity into the following issues: (1) whether Ground Control’s failure to acquire the proper certification pursuant to statute barred any claim for recovery against Capsco and (2) whether the trial court properly converted Yates’ and Harrah’s motion to dismiss to one for summary judgment.

I. WHETHER GROUND CONTROL’S FAILURE TO ACQUIRE THE PROPER CERTIFICATION UNDER SECTION 31-3-15 BARRED ANY CLAIM FOR RECOVERY AGAINST CAPSCO.

¶ 7. The contract between Capsco and Ground Control falls within Mississippi Code Section 31-3-15, which requires contractors to have certificates of responsibility. It states:

No contract for public or private projects shall be issued or awarded to any contractor who did not have a current certificate of responsibility issued by said board at the time of the submission of the bid, or a similar certificate issued by a similar board of another state which recognizes certificates issued by said board. Any contract issued or awarded in violation of this section shall be null and void.

Miss.Code Ann. § 31-3-15 (Rev.2010) (emphasis added).

¶ 8. The stated purpose of requiring certificates of responsibility “is to protect the health, safety and general welfare of all persons dealing with those who are engaged in the vocation of contracting and to afford such persons an effective and practical protection against incompetent, inexperienced, unlawful and fraudulent acts of contractors.” Miss.Code Ann. § 31-3-2 (Rev.2010) (emphasis added). Clearly, the statute was intended to protect both parties to the contract. Furthermore, the penalties that serve to deter parties from entering illegal contracts— such as voiding the contract and imposing fines — apply to both parties.1

¶ 9. Both Ground Control and Capsco were required by statute to obtain certificates of responsibility. Both failed to do so.

[369]*369¶ 10. This Court has never determined whether a party to an illegal contract is barred from recovery under theories of unjust enrichment or quantum meruit. We are not dealing with an unlawful activity contemplated by the rule that “[n]o Court will lend its aid to a man who founds his cause of action upon an immoral or an illegal act.” Price v. Purdue Pharma Co., 920 So.2d 479, 484 (Miss.2006) (plaintiff was suing for his drug addiction) (citing Morrissey v. Bologna, 240 Miss. 284, 300-01, 123 So.2d 537, 545 (1960) (plaintiff was suing to recover an unlawful gaming debt).

¶ 11. It can be argued that Ground Control should be denied equitable relief because it does not have clean hands. See Bailey v. Bailey, 724 So.2d 335, 337 (Miss.1998) (finding that “[t]he clean hands doctrine prevents a complaining party from obtaining equitable relief in court when he is guilty of willful misconduct in the transaction at issue”). However, Capsco should not be able to use this defense in light of its far more egregious conduct. Capsco recruited Ground Control to do the work although it knew that Ground Control did not hold a certifícate of responsibility as required by statute. Both were qualified to enter into the contract, and yet Capsco argues that the penalty should be applied only to Ground Control.

¶ 12.

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Bluebook (online)
120 So. 3d 365, 2013 WL 2436665, 2013 Miss. LEXIS 327, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ground-control-llc-v-capsco-industries-inc-miss-2013.