Opinion
No. 41130.
May 11, 1959.
1. Officers — principal and surety — liability of surety limited to penalty of its bonds.
In action by taxpayer against sheriff and his surety for alleged illegal sale of property under sales tax warrants, Court did not err in limiting liability of surety company to penalty of its bonds.
2. Sheriffs — action by taxpayer against sheriff and his surety for illegal sale of personal property under sales tax warrants — evidence — verdict for taxpayer grossly inadequate.
In action by taxpayer against sheriff and his surety for alleged illegal sale under sales tax warrants of automotive equipment, music machines, pinball machines, candy vending machines, etc., wherein president of taxpayer testified that total value of all equipment was more than $40,000, and that taxpayer owed less than $200 in taxes, verdict in favor of taxpayer for $1,496.22 was so grossly inadequate as to evince bias in favor of sheriff.
Headnotes as approved by McGehee, C.J.
APPEAL from the Circuit Court of Harrison County; LESLIE B. GRANT, Judge.
White White, D. Knox White, Gulfport; Wells, Thomas Wells, Charles Clark, Milton H. Mitchell, Jackson, for appellants.
I. The verdict of the jury was against the overwhelming weight of the evidence and was so inadequate as to clearly evidence bias, passion and prejudice.
A. Plaintiff is entitled to recover the fair market value of its property at the time of conversion. Matthews v. Concrete Engineering Co., 228 Iowa 493, 292 N.W. 64, 133 A.L.R. 1270; Mississippi State Highway Comm. v. Hillman, 189 Miss. 850, 198 So. 565; Rigby v. Stone, 194 Miss. 775, 13 So.2d 230; Walker v. People, 192 Ill. 106, 61 N.E. 489; 16 Words and Phrases (perm. ed.), pp. 81-85.
B. The Court may take judicial knowledge that a forced sale does not bring fair or real value. First National Bank of Chicago v. Byrn Mawr Beach Bldg. Corp., 365 Ill. 409, 6 N.E.2d 654, 109 A.L.R. 1123; In re Kentucky Book Mfg. Co. (Ky.), 30 F. Supp. 400; Levassor v. Central Savings Bank, 249 Ky. 206, 60 S.W.2d 597; Nash Miss. Valley Motor Co. v. Childress, 156 Miss. 157, 125 So. 708; Treadwell Realty Co. v. City of Memphis, 173 Tenn. 168, 116 S.W.2d 997.
C. Inadequacy is evidence of jury prejudice. Barr v. Gulf, M. N.R. Co., 168 Miss. 863, 152 So. 294; City of Indianola v. Love, 227 Miss. 156, 85 So.2d 812; Dyer v. Hobert, 150 Miss. 857, 117 So. 224; Equitable Life Assurance Soc. v. Mitchell, 201 Miss. 696, 29 So.2d 88; Flournoy v. Brown, 200 Miss. 171, 26 So.2d 351; Hulitt v. Jones, 220 Miss. 827, 72 So.2d 204; Kincade Lofton v. Stephens (Miss.), 50 So.2d 587; McLaughlin v. Fagan-Peel Co., 125 Miss. 116, 87 So. 471; National Bank of Brunswick, Ga. v. Gorenflo, 173 Miss. 646, 160 So. 911; Peerless Supply Co. v. Jeter, 218 Miss. 61, 65 So.2d 240; Pittman v. Eberhart Dental Supply Co., 168 Miss. 23, 150 So. 813; Ryals v. Douglas, 205 Miss. 695, 39 So.2d 311; Vaughan v. Bollis, 221 Miss. 589, 73 So. 160; Vascoe v. Ford, 212 Miss. 370, 54 So.2d 541; Walker Bros. v. Nix, 115 Miss. 199, 76 So. 143.
II. The United States Fidelity and Guaranty Company, surety on the Tax Commission's indemnifying bond, is liable for all damages flowing from the seizure and sale of plaintiff's property.
A. The tax warrants were illegally issued and did not justify the sheriff's seizure or sale. Dailey v. State, 56 Miss. 475; Davis v. Newkirk, 5 Denio. 94; Farish v. Smoot (Fla.), 58 So.2d 534; Gilbert v. Crosby, 160 Miss. 711, 135 So. 201; Rigby v. Whitten, 196 Miss. 661, 18 So.2d 152; State Ex Rel Rice v. Hansen Grocery Co., 177 Miss. 204, 170 So. 234, 107 A.L.R. 663; Stevens Enterprises, Inc. v. McDonnell, 226 Miss. 826, 85 So.2d 468; Stevens Enterprises, Inc. v. Stone, 226 Miss. 806, 85 So.2d 461; Telefsen v. Fee, 168 Mass. 188, 46 N.E. 562; Union Motor Car Co. v. Cartledge, 133 Miss. 318, 97 So. 801; Secs. 314, 1921, Code 1942; 47 Am. Jur., Sec. 205 pp. 961, 962; 80 C.J.S., Secs. 123, 127 pp. 334, 338; 2 Freeman on Executions (3rd ed.), Sec. 273 p. 1541.
B. The United States Fidelity and Guaranty Company and the sheriff became joint trespassers against Stevens' rights. Dyett v. Hyman, 129 N.Y. 351, 29 N.E. 261; Long v. Robinson, 222 Mo. App. Rep. 503, 281 S.W. 78; Lovejoy v. Murray, 70 U.S. (3 Wall.) 1, 18 L.Ed. 129; Martin v. Buffaloe, 128 N.C. 305, 38 S.E. 902; Rice Stix Co. v. Wood Henderson, 61 Ark. 442, 38 S.W. 636; Rigby v. Stone, 194 Miss. 775, 11 So.2d 823; Schall v. Newton, 216 N.Y.S. 285; Screws v. Watson, 48 Ala. 628; Shattuck v. Miller, 50 Miss. 386; Stevens Enterprises, Inc. v. Stone, supra; Swain v. Alcorn, 50 Miss. 320; Woodworth v. Gorsline, 30 Colo. 186, 69 P. 705, 58 L.R.A. 417; Secs. 1921, 1922, 10125, Code 1942; 21 Am. Jur., Sec. 641 p. 307; 33 C.J.S., Sec. 456 (b) p. 838; 1 Anderson on Sheriffs, Coroners and Constables, Sec. 502 p. 471; 2 Freeman on Executions (3d ed.), Sec. 273 p. 1541.
III. The loss of profits for the remainder of the contract period is a proper element of plaintiff's damages in this case. Chappell v. Ellis, 123 N.C. 259, 68 Am. St. Rep. 822; Dunbar v. Interior Lumber Co., 102 Miss. 623, 59 So. 852; Fairley v. Albritton, 121 Miss. 714, 83 So. 801; Mergenthaler Linotype Co. v. Watkins, 176 Miss. 44, 168 So. 478; Mississippi Power Light Co. v. Pitts, 181 Miss. 344, 179 So. 363; Montgomery Ward Co. v. Hutchinson, 173 Miss. 701, 159 So. 862; State Ex Rel Rice v. Hansen Grocery Co., supra; Yazoo Delta Mortgage Co. v. Lumbley, 149 Miss. 864, 116 So. 95; Secs. 1923, 10125, Code 1942; 15 Am. Jur., Sec. 155 p. 571; 47 Am. Jur., Sec. 44 p. 853; 51 Am. Jur., Sec. 1050 p. 915; 53 Am. Jur., Sec. 108 p. 898; 80 C.J.S., Sec. 127 (b) p. 339; 85 C.J.S., Sec. 803 p. 125; 2 Freeman on Executions (3d ed.), Sec. 272 p. 1532; Mecham on Public Officers, Secs. 777, 778.
Joe T. Patterson, Atty. Gen., John E. Stone, Jackson Ross, Jackson; Bidwell Adam, Gulfport; Snow, Covington Shows, Meridian, for appellees.
I. The sheriff was protected to the extent that he acted on the face of the warrants. Bank of Almyra v. Laur (Ark.), 184 S.W. 39; Barr v. Combs, 29 Or. 399, 45 P. 776; Brock v. Berry, Demonville Co., 132 Ala. 95, 31 So. 517; Carroll v. Board of Police of Tishomingo County, 28 Miss. 38; Cavitt v. McCrite, 79 Pac. (2) 637; Eads v. Stephens, 63 Mo. 90; Earle v. Gorham Mfg. Co., 37 N.Y. Supp. 1037; Erskine v. Hohnbach, 14 Wall. (81 U.S.) 613, 20 L.Ed. 754; Foster v. Mabe (Ala.), 37 Am. Dec. 749; Hamilton v. Shrewsbury, 15 Am. Dec. 779; Hendricks v. Johnson, 45 Miss. 644; Kean v. Newell, 14 Am. Dec. 321; Klopp v. Witmoyer, 82 Am. Dec. 561, 43 Penn. 219; Newman v. Elam, 30 Miss. 507; Payne v. Green, 10 S. M. 507; Phillips v. Brown, 74 Maine 549; Rigby v. Stone, 194 Miss. 775, 11 So.2d 823, 13 So.2d 230; Rigby v. Whitten, 196 Miss. 661, 18 So.2d 152; Skinner v. Skinner, 26 N.C. 175; Stevens Enterprises, Inc. v. Stone, 226 Miss. 806, 85 So.2d 461; Stevens Enterprises, Inc. v. McDonnell, 226 Miss. 826, 85 So.2d 468; Secs. 1923 et seq., 10125, Code 1942; 47 Am. Jur., Secs. 198-199 p. 956; 57 C.J., par. 549 p. 913; 80 C.J.S., Secs. 122, 126 pp. 330, 336; 2 Cooley on Torts (4th ed.), p. 528; Freeman on Executions (3d ed.), Sec. 100 et seq.
II. Admitting, however, for sake of argument, that the sale was void, the appellants have recovered full damages. Chapman v. Powers, 150 Miss. 687, 116 So. 609; Gibson v. A.P. Lindsey Dist. Co., Inc., 233 Miss. 853, 103 So.2d 345; Harper v. Mississippi State Highway Comm. (Miss.), 62 So.2d 375; Hoffman v. Morrison, 232 Miss. 322, 98 So.2d 771; Illinois Cent. R. Co. v. Harrison, 224 Miss. 331, 80 So.2d 23; Oliver Bus Line v. Skaggs, 174 Miss. 201, 164 So. 9; Shelton v. Underwood, 174 Miss. 169, 163 So. 828; Sumner Stores of Mississippi, Inc. v. Little, 187 Miss. 310, 192 So. 857.
III. Point II of the appellants' brief was effectively waived by second amended declaration. Bank of McLain v. Pascagoula National Bank, 150 Miss. 738, 117 So. 124; Dee v. Southern Brewing Co., 146 Fla. 588, 1 So.2d 562; Lipscomb v. Board of Education, 258 Ala. 47, 61 So.2d 112; Morehead v. U.S.F. G. Co., 187 Miss. 55, 192 So. 300.
IV. Loss of imaginary profits were not proper element of damages. Federal Compress Co. v. Craig, 192 Miss. 689, 7 So.2d 532; Illinois Cent. R. Co. v. Mahon Live Stock Co., 111 Miss. 496, 71 So. 802; Yazoo City v. Loggins, 145 Miss. 793, 110 So. 833.
APPELLANT IN REPLY.
I. The sheriff's sale was void. Jones v. Rogers, 85 Miss. 802, 38 So. 742 (Err. Dism. 214 U.S. 196); Mergenthaler Linotype Co. v. Watkins, 176 Miss. 44, 168 So. 478; Sec. 1757, Code 1880; Sec. 3484, Code 1892; Sec. 1923, Code 1942.
II. The warrants were illegally issued, the sheriff was so advised and cannot justify his actions thereunder. 1 Freeman on Executions (3d ed.), Secs. 99, 102 pp. 354, 376.
III. This Court has the right to review the ruling of the Circuit Court below, refusing to grant a new trial.
IV. This Court has the right to review the rulings by which the lower court refused to recognize tort liability as to the surety company. Aetna Insurance Co. v. Commander, 169 Miss. 847, 153 So. 877; Bates v. City of McComb, 181 Miss. 336, 179 So. 737; Bank of McLain v. Pascagoula National Bank, 150 Miss. 738, 117 So. 124; Green v. Bounds, 112 Miss. 252, 72 So. 1001; Harrison v. Illinois Cent. R. Co., 219 Miss. 401, 69 So.2d 218; Leggett v. Leggett, 202 Miss. 435, 32 So.2d 189; Pennyan v. Alexander, 226 Miss. 419, 84 So.2d 388, 84 So.2d 691; Sec. 1497, Code 1942; 71 C.J.S., Sec. 53 p. 119.
V. This Court has a right to review the actions of the lower court in excluding loss of profits as part of the admeasurement of appellant's damages. Rivers v. Turner, 223 Miss. 673, 78 So.2d 903; 3 Am. Jur., Sec. 352 p. 96; 4 C.J.S., Secs. 250, 291 pp. 769, 900.
On October 20, 1954 the appellee, John Edward (Eddie) McDonnell, sold under certain sales tax warrants issued by the Honorable A.H. Stone, State Tax Commissioner, a certain lot of automotive equipment consisting of trucks and automobiles, a certain lot of music machines, pin-ball machines, candy vending machines, etc., at the northwest front door of the courthouse in Harrison County, Mississippi.
The appellant, Stevens Enterprises, Inc., was contesting the amount of taxes assessed against it by the State Tax Commissioner and the result of that suit is reported in 226 Miss. 806, 85 So.2d 461. The taxpayer sought an injunction from the Chancery Court of Harrison County to prevent the execution of the sales tax warrants involved in the last above-styled cause, but which writ of injunction was refused by the chancery court. Upon appeal from the action of the chancery court in refusing to grant the injunction the case was dismissed here on account of the question's being moot, since the sale of the property complained of in the instant case had been made in the meantime. Stevens Enterprises, Inc. v. McDonnell, Sheriff and Tax Collector, 226 Miss. 826, 85 So.2d 468.
The appellee, McDonnell, before making the sale of the property which he had seized to sell under the said warrants, required of the State Tax Commission an indemnifying bond for his protection. The indemnifying bond was furnished in the amount of $20,000 with the appellee, U.S.F. G. Co. as the surety of the said State Tax Commission.
Upon assuming the duties of his office as Sheriff and Tax Collector of Harrison County the appellee, McDonnell, executed a $10,000 bond to guarantee the faithful performance of his duties as sheriff and tax collector. His surety on that bond was also the U.S.F. G. Co., but he is indemnified to the extent of his $20,000 indemnifying bond in connection with the alleged illegal sale herein complained of.
The instant suit was brought against the sheriff and the surety on the said bonds for the total sum of $120,063.40. It is alleged that the sheriff and tax collector made an illegal sale of the property of the Stevens Enterprises, Inc., and that the sheriff and the surety on his said bonds are liable to him in the amount sued for, instead of only the maximum penalty of the bonds insofar as the surety is concerned.
The president of the Stevens Enterprises, Inc., had been to Mississippi and personally observed the property about three months prior to the date of its seizure, and as a witness at the trial of the instant case he undertook to give the original cost, purchase date, mileage on some of the automotive equipment, and what he considered to be the fair cash market value of the music machines, pin-ball machines, candy vending machines, etc., and then gave the total of all values involved as being more than $40,000 which, as we understand, does not involve the sheriff's fees and costs, some cash taken from vending machines and funds of the taxpayer garnisheed at the bank.
On the other hand the testimony on behalf of the appellees was to the effect that some of the property seized was in bad condition both at the time of the seizure and sale, and the sheriff testified that a part of the property was "serviceable," that is could be used, and that other items were "repairable," that is could be repaired, and the testimony on behalf of the appellees further disclosed that the property's fair cash market value was far less than the calue testified to by the plaintiff. At the sale of the Stevens Enterprises, Inc., made a bid of $6,000 for the property through its attorney who had been authorized to bid as much as $7,500 therefor. The appellee, sheriff and tax collector struck the property off to the state for the sum of $10,000, there being no bid higher than that made by him for the State Tax Commission, and the state undertook to resell the same at private sale as its own, but the record does not disclose how much of the property was sold by the state at private sale after October 20, 1954, or how much was realized by the state from a resale of the property as the state may have actually resold to indicate its fair cash market value.
Section 1923, Code of 1942 provides: "All sales by any sheriff by virtue of an execution or other process, when not issued by a justice of the peace, shall be made at the courthouse of the county; but personal property too cumbersome to be removed, may be sold at the place where the same may be, or at any convenient place; * * *." The trial court was of the opinion, and we think he was correct in so holding, that the property seized should have been present at the sale. At the time of the sale the automotive equipment was stored in the Markham garage in the City of Gulfport and the other property hereinbefore mentioned was stored in a warehouse in the City of Biloxi, some fifteen miles away, at which two places many of the bidders had viewed the same prior to the sale. Certain perishable articles of merchandise, candy, etc., had been disposed of prior to the date of the sale.
The sales tax warrants were for the collection of the total sum of $21,084.61 but it was the contention of the appellants that the taxpayer then owed less than $200 in taxes.
As hereinbefore stated the sale was advertised to be made at the county courthouse in Gulfport. The proof disclosed that there was not enough room in front of the courthouse, and between the courthouse and the street to store all of the property which had been seized and that in fact it would have required all the space between the courthouse and the street and at least a block of the street in front of the courthouse for the assembling of all of the articles that had been seized. But the trial court was evidently of the opinion that the sale of the automotive equipment should have been made at the place where the same was stored and that the sale of the other equipment should have been made where the same was located in the warehouse, unless it was, as shown by the evidence, not feasible to have it all present at the courthouse where it was sold and where it had been advertised to be sold.
The trial court gave a peremptory instruction in favor of the plaintiff which reads as follows: "The Court instructs the jury to find for the Plaintiff in the amount of $996.22, being the fees and costs retained by the Sheriff, plus the difference, if any, between the fair cash market value of the property seized by the Sheriff, as may be shown by a preponderance of the evidence, and the sum of $12,094.25, being the amount realized by the Sheriff from the sale of said property." (Emphasis ours.)
The jury rendered a verdict for the sum of $996.22, but the court suggested that there be an "additur" thereto in the sum of $500 which was agreed to by the appellees and a final judgment was rendered against them for the sum of $1,496.22.
(Hn 1) There is no cross-appeal or cross-assignment of error as to the granting of the instruction in favor of the plaintiff on liability. But the appellants have prosecuted this appeal on the ground that the verdict was grossly inadequate. They also assign as error, among other things, the action of the trial court in limiting the liability of the surety company to the penalty of its bonds. We don't think there was any error in thus limiting the liability of the surety company (Hn 2) but we have concluded that the case should be reversed and remanded on the ground that the amount of the verdict is so grossly inadequate as to evince bias in favor of the sheriff, and since the case is to be reversed and remanded for a new trial we refrain from undertaking to review and discuss in detail the testimony introduced on behalf of the respective parties.
We reverse and remand the case in order that another jury may pass on the amount of the damages only, since the sale, at least, was illegal.
Reversed and remanded.
McGehee, C.J., and Hall, Lee, Holmes, and Gillespie, JJ., concur.