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Fason v. Trussell Enterprises, Inc.

Court of Appeals of Mississippi

August 27, 2013

Kristina FASON, Appellant
v.
TRUSSELL ENTERPRISES, INC. and Hugh D. Trussell, in his individual capacity, Appellees.

Page 455

Hiram Richard Davis, attorney for appellant.

Walter Alan Davis, Oxford, attorney for appellees.

Before IRVING, P.J., CARLTON and JAMES, JJ.

JAMES, J.

¶ 1. Kristina Fason appeals the Webster County Circuit Court's grant of summary judgment in favor of Trussell Enterprises Inc. and Hugh Trussell [1] under the doctrine of res judicata. She asserts several

Page 456

issues on appeal, some of which we consolidate and rephrase for clarity: (1) whether Fason's claims for malicious prosecution, false imprisonment, and abuse of process were compulsory counterclaims in a prior collection suit; (2) whether Fason's claims were properly barred under the doctrine of res judicata; (3) whether Fason's claims were barred under the doctrine of collateral estoppel; and (4) whether the circuit court erred in granting summary judgment in favor of Trussell. Because we find the res judicata issue dispositive, we decline to address Fason's third point of error. We further find that issues one and four depend in part on the outcome of the res judicata issue. Upon review, we find that summary judgment was properly granted in favor of Trussell under the doctrine of res judicata. Therefore, we affirm.

FACTS AND PROCEDURAL HISTORY

¶ 2. Fason operated a business known as the Hendrix Corner Store. On October 11, 2008, she entered into a contract with Trussell Enterprises concerning the placement and operation of an automatic teller machine (ATM) inside the Hendrix Corner Store. The contract was executed by Fason and Hugh Trussell, the agent, president, and sole shareholder of Trussell Enterprises. Under the contract, Fason would put her own funds in the ATM for distribution. When a customer withdrew funds from the ATM, Trussell Enterprises would withdraw funds from the customer's bank account for the amount withdrawn, plus a fee. Under the contract, Fason was entitled to a portion of the fee. Fason provided Trussell Enterprises with her CB & S Bank account number, and Trussell Enterprises automatically placed her portion of the fee into this account.

¶ 3. On September 1, 2010, Trussell Enterprises removed the ATM from the Hendrix Corner Store.[2] However, Trussell Enterprises failed to remove the mechanism that automatically deposited funds into Fason's account. Therefore, the ATM continued to deposit funds into Fason's account until the error was discovered on March 24, 2011. As of March 24, 2011, $18,520 had been wrongfully placed into Fason's account. Trussell Enterprises demanded that Fason return these funds, but Fason would not, or could not, comply.

¶ 4. On March 28, 2011, Hugh Trussell executed a criminal affidavit, which was submitted to the Webster County Justice Court. As a result, Fason was charged with grand larceny, and she was subsequently arrested and incarcerated until bonded out. On May 6, 2011, the criminal charges were dismissed by the justice court.

¶ 5. On April 8, 2011, Trussell Enterprises filed a collection suit against Fason in the Webster County Circuit Court, seeking recovery of the $18,520. On April 8, 2011, Fason was served with process, but she failed to timely answer or otherwise defend. Therefore, on May 12, 2011, Trussell filed an application for entry of default and a default judgment. On May 13, 2011,[3] a default judgment was entered against Fason in the amount of $18,520, plus attorney's fees of $2,255, for a total amount of $20,775, with interest and court costs. Subsequent to the default judgment, Fason filed an answer on May 16, 2011. Fason never attempted to set aside the default judgment.

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¶ 6. On February 28, 2012, Fason filed her own lawsuit against Trussell Enterprises and Hugh Trussell for malicious prosecution, false imprisonment, and abuse of process for filing a criminal action to collect a civil debt. On April 23, 2012, Trussell filed an answer and affirmative defenses. On April 23, 2012, Trussell filed a motion for summary judgment, arguing that Fason's claims were compulsory counterclaims that should have been filed in the collection suit, and that the claims were barred by res judicata and/or collateral estoppel. On May 2, 2012, Fason filed a response opposing summary judgment. On May 3, 2012, a notice of hearing was entered, setting the hearing on the motion for summary judgment for May 21, 2012.

¶ 7. On August 6, 2012, the circuit court entered an order granting summary judgment in favor of Trussell as follows:

Trussell's position is that Fason's claim is a compulsory counterclaim and is barred by the doctrine of res judicata. The test was set forth in Scruggs, Millette, Bozeman, & Dent, P.A. v. Merkel & Cocke, P.A., 804 So.2d 1000[, 1004 (¶ 5) (Miss.2001) ]. The test is (1) whether the same evidence or witnesses are relevant to both claims; (2) whether the issues of law and fact in the counterclaim are largely the same as those in the plaintiff's claim; (3) whether, if the counterclaim were asserted in a later lawsuit, it would be barred by res judicata; and (4) whether or not both claims are based on a " common nucleus of operative fact." The Court then set forth the procedure for applying the test.
In applying the four-prong test stated in Fulgham, the logical[-]relationship test is
used to determine whether a claim and counterclaim arise from the same transaction or occurrence such that a counterclaim is compulsory; it exists when the same operative facts serve as the basis of both claims or the aggregate core of facts upon which the claim rests activates additional legal rights, otherwise dormant.
Clearly this test is met. While Fason alleges that she could not have filed a claim for malicious mischief in Trussell's collection suit since her claim had not matured, this allegation is not supported by the facts. Fason was served with process in the Trussell suit on April 8, 2011, the criminal charges against her were dismissed ... on May 6, 2011, and the default judgment was entered on May 13, 2011. Therefore, her malicious[-]prosecution claim, if any, matured before an answer was due and before a default judgment was entered. As noted above[,] no action was taken to set aside the default judgment.
Trussell maintains that since Fason's claim was a compulsory counterclaim [,] it is barred by res judicata. Res judicata consists of four elements: Identity of the subject matter of the action; [i]dentity of the cause of action; [i]dentity of the parties to the cause of action; [and][i]dentity of the quality or character of a person against whom the claim is made. These issues were addressed in Hill v. Carroll County, 17 So.3d 1081 ( [Miss.] 2009). The subject matter of each cause of action presented is the same. Fason owed Trussell money. The dispute is over how he proceeded to collect it. The transactional relationship is also identical[,] and therefore, there is identity of the cause of action. There is identity of the parties to the cause of ...

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