THE COURT SITTING EN BANC
DAN LEE, PRESIDING JUSTICE, FOR THE COURT:
This case was heard in the Circuit Court of Hinds County as an appeal from an order of the Mississippi Public Service Commission (PSC). The cause came before the PSC on a Motion for Approval of Transfer of Certificate No. 990-T Pursuant to Foreclosure Sale, filed on July 24, 1984, and an Application for Transfer of Certificate No. 990-T, filed on July 18, 1984. The appellant, Ms. Dorman, filed an Objection to Transfer of Certificate on August 13, 1984. She alleged an equitable lien on the certificate, by virtue of an unpaid promissory note executed by Auby Rowell and Auby Rowell, Inc. in favor of her father, William F. Truax.
A hearing was held before the PSC on September 26, 1984. After receiving testimony, the PSC found in favor of Rowell. The PSC found that due and proper notice of the motion and application was given, that Michael Rowell lawfully acquired a perfected security interest in the certificate, that the transfer resulting from the foreclosure sale was a good faith transfer, that the foreclosure sale was valid, that the transaction was consistent with the public interest, and that the PSC has no jurisdiction to condition transfer on payment of an unsecured note. The Circuit Court affirmed the PSC on October 9, 1985.
Ms. Dorman appeals, assigning the following as error:
1. The Circuit Court of Hinds County erred when it affirmed the Order of the Public Service Commission approving the transfer of Certificate 990-T from Auby Rowell, Inc. to Michael Allen Rowell and the transfer of such Certificate from Michael Allen Rowell to Michael Transportation, Inc. as such order was not supported by substantial evidence or by the law and was erroneous in the following particulars:
a. The PSC erred in holding that Michael Allen Rowell held a perfected security interest in such Certificate as Section 77-7-61 does not permit a certificate holder to grant a security interest in such certificate without approval of the PSC.
b. Section 77-7-61 requires the PSC to determine whether or not the transaction between Auby Rowell, Inc. and Michael Allen Rowell and the subsequent transfer to Michael Allen Rowell of such certificate was in good faith. The finding of the PSC that such transaction was in good
faith is contrary to the law and the evidence.
c. Michael Allen Rowell failed to offer proof which would overcome the presumption that such security interest was free from all suspicion, unfair advantage and undue benefit.
WE FIND THAT THE WRONG ALLEGED BY THE APPELLANT COULD NOT BE RESOLVED BY THE PSC, AND, THEREFORE, AFFIRM.
Certificate No. 990-T is a "Certificate of Public Convenience and Necessity as a Restricted Common Carrier of Property by Motor Vehicle." It was originally issued to William F. Truax, the appellant's decedent, on November 15, 1946. He began, in 1959, to lease it to third parties, and on August 5, 1981, he sold it to Auby Rowell and Auby Rowell, Inc. The buyers paid $35,000.00 in cash, and the remaining $40,000.00 of the purchase price was to be paid as agreed upon in a promissory note executed contemporaenously. The terms of the note required three payments of $13,333.33 to be paid on August 5, 1982, 1983 and 1984. Only the 1982 payment was made. Truax's daughter and executrix, Ms. Dorman, filed a complaint in the Circuit Court of Jones County, seeking $26,666.66, plus interest, attorneys' fees and costs. On September 7, 1984, she obtained a default judgment against Auby Rowell, Inc. for $34,346.64.
In the meantime, after the sale of the certificate to Auby Rowell and his corporation, the company's financial situation deteriorated. Beginning in October 1979, the company began receiving loans from Auby's son, Michael. Michael was the Vice-President and General Manager of Auby Rowell, Inc., and may have been a director. Auby Rowell, Inc. was involved in oil field trucking, and, as the oil business declined, its financial condition worsened. Michael admitted that there were times when he drew money from the loan account because the company could not afford to pay him a salary. Even though his primary concern was operations and he was only generally familiar with the financial end of the business, Michael realized, by September of 1982, that the company was in bad shape. Michael testified that he thought the loan was still good because the company was, at that time, in the process of selling off a large amount of real estate. However, he began looking for a way to protect himself. He went to attorney Lunceford Casey, who also worked for the corporation, and asked for advice.
By that time the corporation owed several people, including Truax. Casey advised Michael ...