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LULA GRISHAM THOMPSON v. FIRST MISSISSIPPI NATIONAL BANK AND MUTUAL SAVINGS LIFE INS. CO.

MARCH 09, 1983

LULA GRISHAM THOMPSON
v.
FIRST MISSISSIPPI NATIONAL BANK AND MUTUAL SAVINGS LIFE INS. CO.



BEFORE WALKER, ROY NOBLE LEE AND ROBERTSON

ROBERTSON, JUSTICE, FOR THE COURT:

I.

Lula Grisham Thompson, plaintiff below and appellant here, filed her complaint in the Circuit Court of the First Judicial District of Hinds County, Mississippi. She has named as defendants, First Mississippi National Bank (Bank) and Mutual Savings Life Insurance Company (Mutual Savings), both of whom are appellees here. In her complaint, plaintiff has alleged she and her husband, W. J. Thompson, Jr., obtained a loan from the Bank in the amount of some $40,000.00 on October 24, 1975, and that this loan was covered by credit life insurance procured by the Bank and issued by Mutual Savings.

 Again according to the allegations, on December 19, 1975, W. J. Thompson, Jr. was hospitalized with an illness. On that date Lula Grisham Thompson alleges that she went to the Bank to renew the note and that at that time she tendered to the Bank a sum sufficient to cover a renewal of the credit life insurance policy. This sum was accepted by the Bank. Four days later, W. J. Thompson, Jr. died.

 Under the circumstances, Lula Grisham Thompson charges that Mutual Savings had obligated itself to insure the life of W. J. Thompson, Jr. to the extent of the indebtedness owed by

 the Thompsons to the Bank as aforesaid, and that Mutual Savings has failed and refused to honor its insurance agreement. In the alternative, the complaint alleges that the Bank obligated itself to procure credit insurance on the life of W. J. Thompson, Jr., that it accepted the premium tendered by plaintiff, and that it has failed and neglected to obtain the insurance, as the result of which the debt should be cancelled and discharged. The complaint as alleged seeks both actual and punitive damages.

 After not inconsiderable pretrial manuevering, the Bank filed a motion to transfer the case to Chancery Court. As grounds for transfer the Bank asserted that the case involved a complicated accounting which would be beyond the ken of the average juror. *fn1 Thereafter on July 22, 1981, the Circuit Court sustained the motion for transfer and ordered the entire action transferred to the Chancery Court of the First Judicial District of Hinds County, Mississippi "including the issue of punitive damages."

 After transfer, plaintiff filed no further pleadings. In due course, defendants moved to dismiss, citing Miss. Code Ann. 11-1-39 (1972). *fn2 After a hearing the Chancery Court dismissed the complaint with prejudice.

 Plaintiff, Lula Grisham Thompson, has perfected her appeal from this final order of dismissal. For the reasons set forth below, we reverse.

 II.

 The defect in the proceedings below was entry of the order for transfer by the Circuit Court. That order was erroneous for two reasons.

 A.

 The complaint clearly stated a claim against the defendants for punitive damages. This Court has repeatedly held that chancery courts do not have the power to award punitive damages. E.g., Monsanto Company v. Cochran, 254 Miss. 399, 404-405, 180 So. 2d 624, 626 (1965); Subscribers Casualty Reciprical Exchange v. Totaro, 370 So. 2d 1342 (Miss. 1979). In spite of this, on July 22, 1981, the circuit court ordered transfer to chancery court of all aspects of the case "including the issue of punitive damages." The circuit court, of ...


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