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NEVEL A. WALTERS AND MRS. DELPEHIA WALTERS v. INEXCO OIL COMPANY

SEPTEMBER 07, 1983

NEVEL A. WALTERS AND MRS. DELPEHIA WALTERS
v.
INEXCO OIL COMPANY, A DELAWARE CORPORATION



BEFORE PATTERSON, C. J., BOWLING AND ROBERTSON, JJ.

ROBERTSON, JUSTICE, FOR THE COURT:

I. Introduction

At the heart of this case is the question whether our statute *fn1 requiring assessment of a penalty against an unsuccessful appellant in this Court should be enforced in the federal courts under the Erie *fn2 doctrine. In the case at bar, the United States District Court for the Southern District of Mississippi held that the penalty statute did not apply, even though the sole basis for federal subject matter jurisdiction was diversity of citizenship. 28 U.S.C. 1332. That ruling has been appealed to the United States Court of Appeals for the Fifth Circuit which, invoking the procedures found in our Rule 46, has certified the question to us. *fn3

 This Court has construed Section 11-3-23 on many occasions. *fn4 Whether that statute should apply in a federal court diversity case, however, appears to be an open question, one which is ultimately a question of federal law turning upon the federal judiciary's construction of the Federal Rules of Decisions Act, 28 U. S. C. 1652. We have accepted the certified questions and will attempt to shed such light on the subject as we can.

 II. Factual and Procedural History Leading to Rule 46 Certification

 On February 26, 1971, Nevel A. Walters was working as a roughneck on a drilling rig engaged in drilling a well on premises leased by Inexco Oil Company in Clarke County, Mississippi. On that day, he sustained personal injuries in an explosion occurring on the premises. On February 24, 1977, Walters and his wife, residents of this state, commenced this action against Inexco, a non-resident corporation, to recover damages for his personal injuries and her loss of consortium. Invoking diversity of citizenship jurisdiction, 28 U.S.C. 1332, the Walters sued in the United States District Court for the Southern District of Mississippi, Hattiesburg Division. See 28 U. S. C. 104 (b) (5).

 On May 2, 1979, District Court entered judgments in favor of the Walters for $534,116.54 and $50,000, plus interest, respectively. Walters v. Inexco Oil Company, 511 F. Supp. 21 (S.D. Miss. 1979). On November 5, 1980, the United States Court of Appeals for the Fifth Circuit

 affirmed, Walters v. Inexco Oil Company, 632 F.2d 891 (5th Cir. 1980), and thereafter denied rehearing, 642 F.2d 1210 (5th Cir. 1981). Inexco then filed in the Supreme Court of the United States a petition for writ of certiorari which has been denied. Inexco Oil Company v. Walters, 450 U.S. 999, 101 S. Ct. 1704, 68 L.Ed.2d 200 (1981).

 On April 2, 1981, Inexco paid to the Walters the sum of $674,504.09. This sum represented payment in full of the judgments and interest. This instant question regarding the statutory penalty, however, was expressly reserved.

 Back in the Court of Appeals, the Walters had filed a motion to assess statutory damages, pursuant to Section 11-3-23. They charged that they obtained judgments in the aggregate sum of $584,116.54 on May 2, 1979; that the judgments were affirmed on November 5, 1980; that they had been denied the use of the funds between May 2, 1979, and April 2, 1981, and that under Mississippi law, they are entitled to the damages, pursuant to Section 11-3-23, Miss. Code Ann., as amended. The Walters asserted further that such is the substantive law of the State of Mississippi, and cited a Fifth Circuit case, Proctor v. Gissendaner, 587 F.2d 182 (5th Cir.1979), wherein a similar Alabama statute had been held to constitute a substantive rule that governed in diversity cases.

 On March 19, 1981, the Court of Appeals referred that motion to the District Court which denied it. The District Court reasoned that Section 11-3-23 applied only to appeals to the Supreme Court of Mississippi and could not be construed to be general in nature. The District Court felt that there was a clear distinction between the Alabama statute under consideration in the Proctor case, for it referred to the" appellate court ", while the Mississippi statute, Section 11-3-23, prescribes a penalty to be assessed only by the" supreme court ".

 The Walters perfected an appeal from the District Court's denial of statutory damages, thus bringing the case back to the United States Court of Appeals for the Fifth Circuit. The Court of Appeals determined to invoke the procedures and authority found in our Rule 46. Following an opinion reported as Walters v. Inexco Oil Company, 670 F.2d 476 (5th Cir.1982), the Court of Appeals has certified to this Court two questions set forth below.

 III. The Questions Certified

 1. Does Section 11-3-23, Mississippi Code Annotated, apply only to appeals to the Supreme Court of Mississippi from another court in the state system; or, is Section 11-3-23, Mississippi Code Annotated, general in nature so as to establish a" substantive "rule of damages, which a federal court, sitting in diversity, must apply?

 2. If the answer to the above question is in the affirmative, does the amended Section 11-3-23, which substitutes 15% for the 5% figure, apply, or does the 5% figure apply?

 IV. Our Response And Its Context

 A. The Inartful Questions

 In the present context we accept it as our responsibility to provide the Court of Appeals with such information about our statutory penalty rule as will best assist that Court in resolving the issue before it. The success and usefulness of our efforts depend upon our understanding just what information the Court of Appeals needs. With deference that Court has not worded the primary question - Question No. 1 - as artfully as it might.

 In Question No. 1, we are asked whether Section 11-3-23 is" . . . general in nature. . . . "- as though we or any other group of judicial linguists could provide a meaningful answer to such a vague question, and as though something turns on the answer.

 The question then asks whether the statute is" . . . general in nature so as to establish a `substantive' rule of damages. . . . "Implicit, of course, is the wholly dubious notion that a statute" general in nature "(whatever that means) is automatically" substantive ". *fn5

 The final step in the question's syllogism is" . . . which a federal court, sitting in diversity, must apply. "In short, the Court of Appeals in Question No. 1, reasons that if the statute is general, it is substantive, ...


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