LIBERTY S. & L. ASS'N v. Mitchell

398 So. 2d 208
CourtMississippi Supreme Court
DecidedMay 6, 1981
Docket52281
StatusPublished

This text of 398 So. 2d 208 (LIBERTY S. & L. ASS'N v. Mitchell) 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
LIBERTY S. & L. ASS'N v. Mitchell, 398 So. 2d 208 (Mich. 1981).

Opinion

398 So.2d 208 (1981)

LIBERTY SAVINGS & LOAN ASSOCIATION
v.
Charles A. MITCHELL et al.

No. 52281.

Supreme Court of Mississippi.

May 6, 1981.

Richard D. Gamblin, Thomas G. Lilly, Richard B. Wilson, Jr., Wise, Carter, Child & Caraway, William E. Spell, Sullivan, Hunt, Spell, Shackelford & Henson, Jackson, for appellant.

Hunter M. Gholson, Ralph E. Rood, Gholson, Hicks & Nichols, Columbus, Fred C. DeLong, Jr., Campbell & DeLong, J. Robertshaw, Robertshaw & Merideth, Greenville, for appellees.

Before SMITH, P.J., and LEE and BOWLING, JJ.

LEE, Justice, for the court:

Liberty Savings and Loan Association (Liberty) filed suit in the Circuit Court of Washington County, Honorable B.B. Wilkes, presiding, against Charles A. Mitchell (Mitchell) and others, for damages in the *209 sum of twenty-six million dollars ($26,000,000) based on an alleged breach of fiduciary duty by Mitchell in the management of the association. After an extended period of time, during which the suit was pending, the defendants filed motions to dismiss the suit. The motions were taken under advisement and eventually sustained. Liberty has appealed from the final lower court order dismissing the suit, and assigns such dismissal as error.[1]

Did the lower court err in sustaining the motions of the appellees to dismiss under Mississippi Code Annotated Section 11-53-25 (1972) on the ground that Liberty had not shown good cause for its failure to bring the suit to trial?

Mitchell was active vice-president of Liberty from 1968 to about 1974. The other appellees were members of the board of directors at some time during the same period. Mitchell has asserted that those appellees had no operational authority during the time mentioned, and he assumes full responsibility for changes occurring while he was the active president or vice-president of the institution.

In early 1973, bank authorities discovered discrepancies in loans totalling some nineteen million dollars ($19,000,000) from 1968 to 1973, made by Mitchell to one Boyd L. Hobbs for construction and development projects. Subsequently, this suit was filed on February 18, 1975. On February 28, 1975, Liberty merged into Bankers Trust Savings and Loan Association (BTS&L), which went into receivership in 1976. Thereafter, it was succeeded by Depositors Savings Association (Depositors).

The chief counsel for Liberty and the individual having the responsibility for preparing Liberty's case for trial, gathering together all information sought by the appellees through depositions, and representing Liberty generally in the case, was Honorable Charles L. Sullivan. Appellee Mitchell answered the suit by filing a request for a bill of particulars on April 7, 1975, and was permitted until May 7, 1975, to file responsive pleadings to the complaint. Liberty supplied the bill of particulars on July 23, 1975, stating the Hobbs loans and their supporting collateral and appraisal. Liberty claims that it incurred seventeen thousand dollars ($17,000) accounting fees in the preparation of the bill of particulars.

From July 23, 1975 forward, until April 19, 1979, Mitchell and the other appellees filed numerous interrogatories and discovery material, and Mr. Sullivan was endeavoring as best he could to furnish the information and exhibits sought to be discovered. Without question, the case was complex, involved an enormous mass of documentary material, and required a tremendous amount of work and time to comply with discovery. Throughout the period mentioned, the attorneys on both sides were cooperative, courteous, and understanding in the matters, and continuances and extensions of time were agreed upon by opposing counsel.[2] Mitchell's attorney wrote to Mr. Sullivan on April 11, 1979, and requested a specific date for production of discovery materials. An earlier letter from Mr. Sullivan dated January 29, 1979, indicated that discovery was nearly complete and required only final difficult computations by the accounting firm. Suffice it to say, at no time did appellees' attorneys seek from the court sanctions against Liberty or compulsion to require production of the requested discovery material.

On April 18, 1979, Mr. Sullivan died in an airplane crash. A member of the Sullivan firm notified opposing counsel of the tragedy and Mitchell's counsel agreed to "lay this case on the back burner" until such time as matters had been straightened out. Immediately, the Sullivan firm contacted Depositors about retaining additional counsel to replace Mr. Sullivan as chief counsel. Pursuant to that contact, on April 27, 1979, *210 they conferred with members of the Edmund L. Brunini firm in Jackson with a view toward retaining that firm to proceed with the case. After spending approximately one hundred (100) hours in reviewing the case files, the firm decided that it would be unable to associate in the case. Immediately, members of the Sullivan firm contacted the Lake, Tindall firm in Greenville for the same purpose, and, after a lengthy study of the files, that firm likewise was unable to associate in the case.

The appellees filed motions to dismiss the case on October 17, 1979. At the hearing on the motions, Liberty produced affidavits and evidence from Honorable William Spell of the Sullivan firm, Honorable Edmund L. Brunini and Honorable Lawrence E. Allison from the Brunini firm and Honorable Charles S. Tindall from the Lake, Tindall firm which set forth their work and review of the Liberty files subsequent to the death of Mr. Sullivan for a determination as to whether or not the Brunini and Tindall firms could associate in the case. The proof on behalf of Liberty showed without question that it was diligent in its efforts to seek trial counsel immediately following the death of Mr. Sullivan until the motions to dismiss were ruled upon. In fact, Liberty was finally successful in retaining the Wise, Carter, Childs and Caraway firm at or about the time the order was entered sustaining the motions to dismiss. The appellees declined to produce any evidence on the hearing of the motions and simply stated to the court that they would rely upon the record as made. No effort was made to show prejudice the appellees may have sustained over the period of time prior to the dismissal.

On November 8, 1979, the lower court rendered a letter opinion on the motions to dismiss Liberty's action, and, in that opinion, stated that it would be dismissed as a stale case. [See Appendix]. The order followed the letter opinion. Mississippi Code Annotated Section 11-53-25 (1972), referred to therein, follows:

"The clerk of any court shall move the court to dismiss any cause pending therein in which no step has been taken for the two terms preceding; and the court shall, unless good cause be shown to the contrary, dismiss the same at the costs of the plaintiff or complainant."

Osborne v. Vince, 240 Miss. 807, 129 So.2d 345 (1961), cited by the lower court, states:

"Miss.Code 1942, Recompiled, Section 1578, provides: `The clerk of any court shall move the court to dismiss any cause pending therein in which no step has been taken for the two terms preceding; and the court shall, unless good cause be shown to the contrary, dismiss the same at the costs of the plaintiff or complainant.' In Mississippi Central Railroad Co. v. Brookhaven Lbr. and Mfg. Co., 1933, 165 Miss. 820, 147 So.

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Bluebook (online)
398 So. 2d 208, Counsel Stack Legal Research, https://law.counselstack.com/opinion/liberty-s-l-assn-v-mitchell-miss-1981.