BRIEF OF THE APPELLANT

Transcription

1 E-Filed Document Jan :01: CA Pages: 23 IN THE SUPREME COURT OF MISSISSIPPI No CA A-1 FIRE SPRINKLER CONTRACTORS, LLC d/b/a A-1 FIRE SPRINKLER, LLC; WAYNE MARISCO and SANDY MARISCO Appellants (Defendants Below) vs. B.W. SULLIVAN BUILDING CONTRACTOR, INC. Appellee (Plaintiff Below) BRIEF OF THE APPELLANT On Appeal from Final Judgment After Bench Trial In the Circuit Court of Pearl River County, Mississippi, Civil Action No H, The Honorable Prentiss G. Harrell Presiding OF COUNSEL: H. Richard Davis, Jr. (MSB# ) JERNIGAN COPELAND & ANDERSON, PLLC P.O. Box 2598 Ridgeland, Mississippi Office: (601) Fax: (601) Counsel for Appellant

2 IN THE SUPREME COURT OF MISSISSIPPI A-1 FIRE SPRINKLER CONTRACTORS, LLC d/b/a A-1 FIRE SPRINKLER, LLC; WANYE MARISCO and SANDY MARISCO vs. B.W. SULLIVAN BUILDING CONTRACTOR, INC. APPELLANTS Cause No CA APPELLEE CERTIFICATE OF INTERESTED PERSONS The undersigned counsel of record certifies that the following listed persons have or may have an interest in the outcome of this case. These representations are made in order that the Judge of this Court may evaluate possible disqualification or recusal: 1. A-1 Fire Sprinkler Contractors, LLC, Appellant; 2. A-1 Fire Sprinkler, LLC, Appellant; 3. Wayne P. Marisco, Appellant; 4. Sandy Marisco, Appellant; 5. B.W. Sullivan Building Contractor, LLC, Appellee. THIS, the 19th day of January, Respectfully submitted, A-1 FIRE SPRINKLER CONTRACTORS, LLC; A-1 FIRE SPRINKLER, LLC; WAYNE MARISCO; and SANDY MARISCO By: /s H. Richard Davis, Jr. H. Richard Davis, Jr. (MSB# ) -i-

3 TABLE OF CONTENTS CERTIFICATE OF INTERESTED PERSONS. TABLE OF CONTENTS... TABLE OF AUTHORITIES.. i ii iii QUESTIONS PRESENTED.. 1 STATEMENT OF THE CASE.. 2 STATEMENT OF FACTS... 2 SUMMARY OF THE ARGUMENT 5 STANDARD OF REVIEW.. 6 ARGUMENT 6 I. As a matter of law, B.W. Sullivan Building Contractor, Inc., is precluded under the volunteer doctrine from seeking payment from the appellants. 6 II. III. As a matter of law, the subcontract at issue in this case excluded the items for which B.W. Sullivan sought to hold the appellants liable The trial court erred in awarding judgment against an LLC which was neither a party to the lawsuit nor the subcontract 13 a. A1 Fire Sprinkler, LLC, was not a party to the lawsuit.. 13 b. A1 Fire Sprinkler, LLC, was not a party to the subcontract.. 15 CONCLUSION 16 CERTIFICATE OF SERVICE 18 -ii-

4 Cases TABLE OF AUTHORITIES Page City of Picayune v. S. Reg'l Corp., 916 So. 2d 510 (Miss. 2005). 14 City of Vicksburg v. Butler, 56 Miss. 72 (1878). 10 Gardemal v. Westin Hotel Co., 186 F.3d 588 (5th Cir. 1999) 15 Garrett v. Hart, 250 Miss. 822, 168 So. 2d 497 (1964) 13 Genesis Ins. Co. v. Wausau Ins. Companies, 343 F.3d 733 (5th Cir. 2003) 7 Glantz Contracting Co. v. Gen. Elec. Co., 379 So. 2d 912 (Miss. 1980)... 8 Horne v. Time Warner Operations, Inc., 119 F. Supp. 2d 624 (S.D. Miss. 1999)... 8 Johnson, Drake & Piper, Inc. v. United States, 531 F.2d 1037 (Ct. Cl. 1976) Lowe v. Lowndes Cty. Bldg. Inspection Dep't, 760 So. 2d 711 (Miss. 2000). 6 Martin v. Williams, 172 So. 3d 782 (Miss. Ct. App. 2013)... 6 McDaniel Bros. Const. Co. v. Burk-Hallman Co., 253 Miss. 417, 421, 175 So. 2d 603 (1965) 7, 8 Mississippi State Highway Comm'n v. Patterson Enterprises, Ltd., 627 So. 2d 261 (Miss. 1993) 12 One 1970 Mercury Cougar v. Tunica Cty., 115 So. 3d 792 (Miss. 2013) 8 -iii-

5 Parkerson v. Smith, 817 So. 2d 529 (Miss. 2002) 12 Rest. of Hattiesburg, LLC v. Hotel & Rest. Supply, Inc., 84 So. 3d 32 (Miss. Ct. App. 2012) 14 Riverview Dev. Co., LLC v. Golding Dev. Co., LLC, 109 So. 3d 572 (Miss. Ct. App. 2013) Rotenberry v. Hooker, 864 So. 2d 266 (Miss. 2003).. 12 Statutes and Rules of Court Page Miss. Code Ann Miss. Code Ann Miss. Code Ann Miss. R. Civ. P iv-

6 QUESTIONS PRESENTED 1. B.W. Sullivan Building Contractor, Inc., a general contractor, hired A1 Fire Sprinkler Contractors, LLC, to perform certain work at Camp Shelby for the sum of $220, During the course of construction the parties differed as to the scope of work under the subcontract. The general contractor ultimately paid $252, for labor and materials it claimed to be within the subcontract, and it did so voluntarily, without any reservation of rights. The first question presented is: Does the volunteer doctrine or voluntary payment rule preclude the general contractor from recovering any funds voluntarily paid? 2. The subcontract at issue in this case is one page long. It was for a stipulated sum of $200, and a loosely-defined scope of work. The price of the subcontract was the exact price of the detailed bid submitted by A1 Fire Sprinkler, LLC, which excluded any concrete work and dry agent work. The second question presented is: Did the Circuit Court err in holding that the subcontract included the work specifically excluded in the bid? 3. B.W. Sullivan Building Contractor, Inc. ( BWS ) sued A1 Fire Sprinkler Contractors, LLC, (a Mississippi LLC) d/b/a A1 Fire Sprinkler, LLC, Wayne Marisco (the sole member of A1 Fire Sprinkler Contractors, LLC), and Sandy Marisco (Wayne s wife). The cause of action was premised upon an alleged breach of a construction subcontract between BWS and A1 Fire Sprinkler Contractors, LLC. At all applicable stages of the litigation, including at trial and in post-trial motion, the Defendants argued that A1 Fire Sprinkler, LLC (a separate Mississippi LLC), was not a proper party in interest. After a short bench trial, the Court rendered judgment on the breach of contract for BWS and against A1 Fire Sprinkler, LLC. The final question presented is: Did the trial court err in rendering judgment against a party not properly named in the Complaint and not a party to the contract which was allegedly breached? -1-

7 STATEMENT OF THE CASE/PROCEDURAL BACKGROUND This is a direct appeal from a final judgment entered after a bench trial in the Circuit Court of Pearl River County, Mississippi. After hearing the testimony of two witnesses, the trial court granted judgment in favor of the Plaintiff/Appellee B.W. Sullivan Building Contractor, Inc., and against A1 Fire Sprinkler, LLC. The judgment was founded upon an alleged breach of contract by A1 Fire Sprinkler Contractors, LLC (a different company from A1 Fire Sprinkler, LLC) where the Plaintiff voluntarily overpaid amounts that it claimed were within the scope of the contract. Because the issues presented in this appeal are questions of law, the Appellants are requesting that this Court reverse the judgment of the trial court and render judgment in their favor. STATEMENT OF FACTS This civil action is based upon the relationship between a general contractor on a public job and its subcontractor. A dramatis personae will aid this Court in determining liability, or lack thereof: Mississippi Military Department ( MMD ) Owner of the project; B.W. Sullivan Building Contractor, Inc. ( BWS ) General contractor for the project; A1 Fire Sprinkler Contractors, LLC ( Contractors ) BWS s subcontractor; A1 Fire Sprinkler, LLC ( Sprinkler ) Never a party to the subcontract; Wayne Marisco ( Marisco ) Member of both Contractors and Sprinkler; Sandy Marisco ( Sandy ) Wayne s wife and never a party to the subcontract; VFP Fire Suppression ( VFP ) Third party who supplied clean agent system. -2-

8 MMD bid a contract for the construction of the Combined Arms Collective Training Facility at Camp Shelby in Perry County, Mississippi to BWS. On May 18, 2010, Contractors submitted a bid proposal to furnish, the necessary labor, materials, tools and equipment required to perform the outlined work below for the above subject project, all for the sum of Two Hundred Twenty Thousand Dollars and No Cents ($220,000.00). 1 The proposal included a specified scope of work and excluded certain work. Of importance to this appeal, Contractors agreed to build a 10,000 gallon water storage tank. 2 However, Contractors specifically stated that, This proposal excludes the following Any and all concert work. 3 At trial, all parties and the Court stipulated that this was a scrivener s error and that the bid actually excluded all concrete work. 4 The bid, which was incorporated into the subcontract, also stated in the subject line that it was for (in bold originally) Fire Protection (Wet Pipe Systems). 5 On August 9, 2010, BWS entered into a one page subcontract with Contractors for the amount of $220,000.00, which is the exact amount quoted in Contractors bid. The entire description for the subcontract stated, Furnish and install all fire sprinkler systems and fire pump/house as per plans and specifications and addendums as prepared by JBHM 1 The citations are to the concurrently filed record excerpts, which are bates labeled in the bottom, right hand corner of the excerpts. The citations are R.E. followed by the page number. R.E R.E R.E When citing to testimony from the transcript, the citation will list the page in the record excerpts, followed by the lines of the transcript. This citation is to Page 142 of the Record Excerpts at lines 1 through 8. R.E. 142 at R.E

9 Architects. 6 The subcontract did not attach or incorporate the plans and specifications, nor did it lay out the extent of those specifications. Throughout the course of the construction project, Wayne Marisco, as agent for Contractors apprised BWS of its progress and further defined the scope of work under the contract. This was memorialized through s between Wayne Marisco and Scott Humphrey, BWS s project manager. 7 At trial, the Court noted that it would not value the correspondence between the parties because of the language of the original contract. 8 Nevertheless, the s do establish that Wayne Marisco maintained throughout the course of the project that his company was not responsible for providing concrete work or dry agent under the subcontract. BWS paid $252, in what it terms Payments to contract A1 Fire Sprinkler, LLC. 9 This was $32, more than the amount awarded in the original subcontract. There was no evidence presented at trial that BWS was under any legal or other compulsion to pay this amount. There was no evidence presented at trial that Contractors or any other company engaged in any fraudulent activity. Indeed, the Court specifically found when orally rendering its verdict from the bench that there was no evidence of fraud in this case. 10 At trial, the evidence demonstrated that A1 Fire Sprinkler Contractors, LLC, submitted a bid which excluded all concrete work and all dry agent work. That bid was included as a part of the subcontract, and BWS was bound by that bid. When BWS discovered that the 6 R.E Trial Exhibits 7-8, R.E R.E. 113 at Trial Exhibit 2, R.E. at R.E. 135 at

10 items were not included in the subcontract, it voluntarily made payments to other subcontractors instead of increasing the total amount of the subcontract and it sued Contractors for the amounts voluntarily paid for fire protection which exceeded the $220, amount in the subcontract. On May 6, 2015, the trial court held a bench trial in which two witnesses testified. After hearing the testimony of both witnesses, the trial court ruled from the bench that, even though the subcontract was between A1 Fire Sprinkler Contractors, LLC, and BWS, it was awarding damages for breach of contract against A1 Fire Sprinkler, LLC, which was neither a party to the subcontract nor the litigation. SUMMARY OF THE ARGUMENT The appellants performed the work required under the subcontract, as outlined in the bid document submitted to B.W. Sullivan. B.W. Sullivan ultimately paid $252, for materials and labor and charged it to the subcontract, which was initially for only $200, BWS voluntarily made the payment to A1 Fire Sprinkler Contractors, LLC, and to third parties, which it did not have to do. It did so without reservation of rights and without any legally cognizable duress, and, in so doing, it waived any claims against the subcontractor for overpayment under the volunteer doctrine. The subcontract at issue in this case incorporated the specific bid submitted by A1 Fire Sprinkler Contractors, LLC, in its terms. That bid was for wet pipe systems only, did not mention any installation of dry agent materials, and specifically excluded any concrete work. The subcontract was for the exact amount of the bid proposal submitted by A1 Fire Sprinkler Contractors, LLC. Under established Mississippi law, the subcontract in this case did not -5-

11 include any concrete work or installation of dry agent materials, and the trial court erred as a matter of law in finding that it did. Finally, the trial court erred in awarding judgment against A1 Fire Sprinkler, LLC, an LLC separate and legally discrete from the actual subcontractor in the case, A1 Fire Sprinkler Contractors, LLC. The judgment was awarded against a company which was not a party to the contract and was not properly a party to the actual lawsuit. STANDARD OF REVIEW This appeal raises pure questions of law, including the validity and scope of a contract under a specified set of facts, whether or not an undisputed overpayment constitutes waiver, and whether or not an LLC which was never a party to the contract nor properly named in the Complaint could face a judgment against it. Accordingly, this Court should apply de novo review to each of the issues. Lowe v. Lowndes Cty. Bldg. Inspection Dep't, 760 So. 2d 711, 712 (Miss. 2000) ( This Court reviews questions of law de novo. ) Contract construction is a matter of law, reviewed de novo. Martin v. Williams, 172 So. 3d 782, 785 (Miss. Ct. App. 2013). ARGUMENT I. THE COURT SHOULD REVERSE AND RENDER JUDGMENT IN FAVOR OF APPELLANTS UNDER THE VOLUNTEER DOCTRINE. The trial court improperly awarded damages to BWS under the theory of breach of contract when BWS admitted that it voluntarily paid more than the amount of the subcontract. The judgment below vitiates Mississippi s long-standing rule that payments (even overpayments) which are voluntarily made without any threat, duress, coercion, or fraud, cannot be recovered under the theory of breach of contract. This is known as the volunteer doctrine, and it has long applied to factual scenarios such as the one in this case. The -6-

12 volunteer doctrine is, a common-law construct that has been consistently followed in Mississippi. Genesis Ins. Co. v. Wausau Ins. Companies, 343 F.3d 733, 736 (5th Cir. 2003). Here, BWS awarded A1 Fire Sprinkler Contractors, LLC, a subcontract in the amount of $220, That subcontract precisely matched the bid submitted by A1 Fire Sprinkler Contractors, LLC, in its amount. Throughout the project and in its bid A1 specifically excluded the dry agent work and any concrete work. Nevertheless, BWS paid out $252, under what it claimed to be the subcontract. BWS never alleged fraud, and the Court specifically found that there was no evidence of fraud in this case. 11 A similar factual scenario was decided by the Mississippi Supreme Court in 1963, and it remains good law to this day. In McDaniel Bros. Const. Co. v. Burk-Hallman Co., 253 Miss. 417, 421, 175 So. 2d 603, 604 (1965), the Court was faced with the following question: Id. The question is whether a prime contractor, who voluntarily pays the assignee of a subcontractor a sum of money in excess of what said assignee could have recovered if it had sued the prime contractor, may recover said excess from the assignee when said payment was made by the prime contractor without compulsion, fraud, mistake of fact, or promise on the part of the assignee to repay the excess. We hold that such voluntary payment may not be recovered. In that case, McDaniel Brothers was the general contractor on a public job. McDaniel Bros., 253 Miss. at 419, 175 So. 2d at 603. McDaniel Brothers hired Magnolia Paint and Wallpaper to perform certain work for $23, Id. Magnolia assigned the funds owing to it under the subcontract to another party, Burk-Hallman Company, and McDaniel Brothers ultimately paid $33, for labor and materials in the subcontract. Id. The Mississippi Supreme Court 11 R.E. 135 at

13 held that, a voluntary payment can not be recovered back, and a voluntary payment within the meaning of this rule is a payment made without compulsion, fraud, mistake of fact, or agreement to repay a demand which the payor does not owe, and which is not enforceable against him, instead of invoking the remedy or defense which the law affords against such demand. McDaniel Bros. Const. Co. v. Burk-Hallman Co., 253 Miss. 417, 423, 175 So. 2d 603, 605 (1965). [T]he determination of whether payments are made on a voluntary basis depends on the facts of the particular case and whether such facts indicate an intent on the part of the payor to waive his rights. Glantz Contracting Co. v. Gen. Elec. Co., 379 So. 2d 912, (Miss. 1980). There are only three circumstances under which a person may recover a payment made, even if the person paid more than he may actually have owed: compulsion (duress), fraud, and mistake of fact. Horne v. Time Warner Operations, Inc., 119 F. Supp. 2d 624, 628 (S.D. Miss. 1999) aff'd sub nom. Horne v. Time Warner Operations, 228 F.3d 408 (5th Cir. 2000). In this case, BWS never presented any evidence that it was forced to overpay the funds under the subcontract. On a number of occasions, BWS s trial counsel argued that BWS had to pay the funds in order to receive the balance of the general contract. 12 However, arguments from BWS s counsel is not evidence. See One 1970 Mercury Cougar v. Tunica Cty., 115 So. 3d 792, 796 (Miss. 2013) ( No citation of authority is necessary for the fundamental propositions that issues of fact are decided by the weighing of evidence, and that the arguments of counsel are not evidence. ). Aside from the testimony from its counsel, BWS presented the following to support its claim that the overpayments were not voluntary: 12 R.E. 32 at 19-21; R.E. 33 at

14 When asked on direct examination about why BWS paid certain portions of the subcontract as joint checks to Contractors and sub-subcontractors, Edwin Humphrey testified that, We would be breach of contract. We would not meet our completion date, and, thus, be charged liquidated damages. 13 In explaining why BWS paid another party directly, Humphrey testified that, We were approaching the testing deadline. So in order to put the last pieces of the puzzle together, so to speak, VFP [another fire protection contractor] had to come complete their work. We ultimately had no option but to do what we did. 14 As important as the list of evidence presented is a list of evidence that BWS failed to present to the court. There is nothing in the record that demonstrates that BWS ever reserved its right to seek a refund for funds overpaid. Indeed, the trial court has the following exchange with counsel for BWS: THE COURT: The Sullivan company is a pretty sophisticated company has been my observation over the years. Couldn't they have paid that under reservation? MR. VARNADO: I don't know how they could have, Your Honor. 15 Just as BWS failed to reserve rights, it also failed to prove that it was tricked or otherwise fraudulently induced into making payments. The Court specifically found that there was no evidence of any fraud on the part of the Appellants. 16 BWS never put on any proof any mistake in paying more than the amount of the subcontract; indeed, it explicitly knew what it was doing. 17 There is insufficient record evidence to support any contention that BWS was coerced into overpaying under the subcontract. [C]ompulsion or duress which will make a payment 13 R.E. 66 at R.E. 68 at R.E. 33 at R.E. 135 at ( I do not see where that's been established in this hearing today. We don't have fraud. ) 17 See R.E. 68 at ( We ultimately had no option but to do what we did. ) -9-

15 involuntary, is, that there must be actual or threatened exercise of power possessed, or believed to be possessed, by the person exacting or receiving the payment, on the person or property of another, for which the other has no other means of immediate relief than by making payment. City of Vicksburg v. Butler, 56 Miss. 72, 74 (1878) (cites omitted) (emphasis in original). The subcontract in this case was for $220, The general contract between the MMD and BWS was for approximately six-and-a-half million dollars. 18 For any public project with the State of Mississippi, which is greater than $100,000.00, the general contractor is required to post both payment and performance bonds. See Miss. Code Ann While there was a liquidated damages provision in the general contract for failure to finish timely, there was no evidence presented at trial that the fire protection system was delaying the overall project. According to the project manager for BWS, amendments to the general contractor placed the deadline for completion at February 2, The last payment claimed under the subcontract was directly to VFP Fire Suppression on January 16, This was weeks before the deadline. Curiously, there is no correspondence between BWS and any of the appellants suggesting duress. Edwin Humphrey testified that the only reason BWS paid VFP directly for the clean agent system was because they were facing testing deadlines. 21 However, there is nothing to corroborate this, including the s presented at trial. Neither of the two witnesses at trial testified that BWS demanded that Contractors perform everything or face 18 R.E. 55 at R.E. 56 at Trial Exhibit 2, R.E R.E. 68 at

16 suit. In short, BWS never demonstrated that it paid the amounts it claimed to be under the subcontract under any duress whatsoever. Under the facts presented at trial, BWS voluntarily paid $252, to A1 Fire Sprinkler Contractors, LLC, and third parties for fire protection. The only coercion or duress addressed at trial by BWS was the potential imposition of liquidated damages if the project were not completed on time. BWS made its last payment under the subcontract on January 16, 2012 with a completion date of February 2, The potential for economic damages is not sufficient to constitute duress. Economic pressure and even the threat of considerable financial loss' are not duress. Johnson, Drake & Piper, Inc. v. United States, 531 F.2d 1037, 1042 (Ct. Cl. 1976) (cites omitted). In sum, Mississippi law is clear that a voluntary payment cannot be recovered. That is exactly what the record demonstrates in this case: BWS failed to properly read the bid documents submitted and awarded a contract which excluded concrete work and dry agent installation. Accordingly, it paid others directly for those services voluntarily and then sought to sue its subcontractor for its voluntary overpayments. The Court should reverse and render the judgment on this basis alone. II. THE SUBCONTRACT EXCLUDED THE ITEMS FOR WHICH B.W. SULLIVAN SOUGHT TO HOLD APPELLANTS LIABLE. A1 Fire Sprinkler Contractors, LLC, submitted its bid to provide the wet pipe fire protection system on May 18, 2010, to perform the work enumerated in the bid for $220, On August 9, 2010, BWS awarded Contractors the subcontract for the exact 22 Trial Exhibit 2, R.E. 145; Testimony of Edwin Humphrey, R.E. 56 at

17 amount in the bid. BWS sued Contractors and the other Appellants for two counts: 1) Breach of contract; and 2) Willful misconduct and willful breach of contract. 23 The Court s judgment in this case was for breach of contract. 24 However, the Court erred as a matter of law in finding that the subcontract required Contractors to perform the work specifically excluded in its bid. This is a question of contract construction, which is a question of law this Court reviews de novo. Questions concerning the construction of contracts are questions of law that are committed to the court rather than questions of fact committed to the fact finder. Parkerson v. Smith, 817 So. 2d 529, 532 (Miss. 2002) (quoting Mississippi State Highway Comm'n v. Patterson Enterprises, Ltd., 627 So. 2d 261, 263 (Miss. 1993)). The elements of a valid contract are: (1) two or more contracting parties, (2) consideration, (3) an agreement that is sufficiently definite, (4) parties with legal capacity to make a contract, (5) mutual assent, and (6) no legal prohibition precluding contract formation. Rotenberry v. Hooker, 864 So. 2d 266, 270 (Miss. 2003) (internal cites omitted). In this case, there was a one page subcontract for the stipulated sum of $220, Attached to the contract was the bid by A1 Fire Sprinkler Contractors, which matched the award exactly. 26 The subject line of the bid stated, in bold letters, that the bid for Camp Shelby, Fire Protection (Wet Systems). 27 The bid proposal did not include a dry agent system, which 23 Complaint, R.E at Judgment, R.E Trial Exhibit 1, R.E Trial Exhibit 1, R.E R.E

18 Contractors was not licensed to install. The bid proposal also specifically excluded all concrete work. [I]n construction of a contract the specific provisions also ordinarily qualify the meaning of general provisions when there is a conflict between them. Garrett v. Hart, 250 Miss. 822, 834, 168 So. 2d 497, 503 (1964). While the general language in the subcontract stating that Contractors would, [f]urnish and install all fire sprinkler systems and fire pump/house as per plans and specifications and addendums as prepared by JBHM Architects, the specific language of the bid excluded both dry agent and any concrete work. To the extent that the subcontract at issue was definite and enforceable and to the extent that BWS did not waive its rights thereunder by voluntary overpayment the specific terms of the bid should apply over the general terms in the description. See Riverview Dev. Co., LLC v. Golding Dev. Co., LLC, 109 So. 3d 572, 575 (Miss. Ct. App. 2013). III. THE TRIAL COURT IMPROPERLY FOUND A1 FIRE SPRINKLER, LLC LIABLE IN THIS CASE. At the conclusion of trial, the trial court ordered a judgment against A1 Fire Sprinklers, LLC. 28 This was in spite of the fact that A1 Fire Sprinkler, LLC, was ever a proper party to either the case or to the subcontract. This was incorrect and, even if this Court finds liability on the part of any of the Appellants, the only party to the subcontract and this lawsuit was A1 Fire Sprinkler Contractors, LLC. a. A1 Fire Sprinkler, LLC, was not a party to the lawsuit. BWS sued the following parties for the alleged overpayment : A1 Fire Sprinkler Contractors, LLC d/b/a A1 Fire Sprinkler Contractors, LLC, Wayne Marisco, and Sandy 28 Judgment, R.E

19 Marisco. 29 BWS never amended its complaint and never issued summons for A1 Fire Sprinkler, LLC. 30 Under the Mississippi Rules of Civil Procedure, [i]n the complaint the title of the action shall include the names of all the parties. Miss. R. Civ. P. 10(a). The Complaint was filed on April 23, 2013, which was substantially after A1 Fire Sprinkler, LLC, filed its Certificate of Formation with the Mississippi Secretary of State on December 9, Neither A1 Fire Sprinkler Contractors, LLC, nor BWS sought to amend the original contract. Edwin Humphrey testified at trial that he had actual knowledge during the construction project that A1 Fire Sprinkler Contractors, LLC, was dissolving and that A1 Fire Sprinkler, LLC, was being formed. 31 Despite actual knowledge, BWS never properly named A1 Fire Sprinkler, LLC. Like a corporation, an LLC is purely a creature of statute. Rest. of Hattiesburg, LLC v. Hotel & Rest. Supply, Inc., 84 So. 3d 32, 39 (Miss. Ct. App. 2012); See, also, City of Picayune v. S. Reg'l Corp., 916 So. 2d 510, 523 (Miss. 2005) ( [A] corporation acquires its existence and authority to act from the state and, as such, is a creature of statute. ). The Mississippi legislature enacted the Revised Limited Liability Act ( Revised Act ) in 2010, which went into effect on January 1, See Laws 2010, Ch. 532, 1, eff. January 1, 2011; codified at Miss. Code Ann , et seq. The Revised Act was in effect during the time at which the construction project was being built. Under the Revised Act, the debts, obligations and liabilities of a limited liability company, whether arising in contract, tort or otherwise, shall be solely the debts, obligations and liabilities of the limited liability company, and no member, manager or officer of a limited liability 29 Complaint, R.E Trial Court Docket, R.E R.E. 85 at

20 company shall be obligated personally for any such debt, obligation or liability of the limited liability company solely by reason of being a member, acting as a manager or acting as an officer of the limited liability company. Miss. Code Ann (1). As a member of an LLC cannot be sued solely because of his membership interest in the LLC, one LLC cannot be sued because its members are the same as the other. See, e.g. Gardemal v. Westin Hotel Co., 186 F.3d 588, 594 (5th Cir. 1999) (Texas law) ( [O]ne-hundred percent ownership and identity of directors and officers are, even together, an insufficient basis for applying the alter ego theory to pierce the corporate veil. ). The trial court specifically held that the BWS failed to meet its burden in piercing the corporate veil. 32 In spite of this finding, the trial court awarded judgment against LLC2, which was A1 Fire Sprinkler, LLC and not A1 Fire Sprinkler Contractors, LLC. 33 Therefore, the judgment is erroneous because it was awarded against an LLC which was not a party to the litigation. b. A1 Fire Sprinkler, LLC, was not a party to the original contract. Just as A1 Fire Sprinkler, LLC, was never properly party to the litigation, it was also not a party to the subcontract. The subcontract in this case was between B.W. Sullivan Building Contractor, Inc., and A1 Fire Sprinkler Contractors, LLC. 34 All work performed by Contractors was completed in November 2011, before Contractors was dissolved and before A1 Fire Sprinkler, LLC, was formed. Specifically, the trial court questioned Wayne Marisco: Q: When did you receive your last payment, or when did you consider the contract to be completed with Sullivan? A: I don t even recall when it was, to be honest with you. 32 R.E. 135 at 28-29; R.E. 136 at R.E. 136 at 13-15; R.E Trial Exhibit 1, R.E

21 Q: Approximately. A. I would say my portion of it was around November of This is corroborated by the evidence presented at trial, which shows that the last payment made by BWS to A1 Fire Sprinkler Contractors, LLC, directly was on December 1, 2011, with one check being paid jointly to A1 and VFP on December 16, In its Complaint, BWS alleged two counts against the Defendants/Appellants: Breach of contract and willful misconduct and willful breach of contract. 37 While BWS failed to demonstrate a breach of contract as a matter of law, it certainly did not establish breach of a contract between itself and A1 Fire Sprinkler, LLC, which did not come into existence until December 2011 at the end of the subcontract. CONCLUSION B.W. Sullivan Building Contractor, Inc., sued A1 Fire Sprinkler Contractors, LLC, and several of its members for breach of contract when it paid A1 Fire Sprinkler Contractors, LLC, and other fire protection companies more than the amount of the subcontract between BWS and A1 Fire Sprinkler Contractors, LLC. BWS paid these funds voluntarily and without any reservation of rights to seek recovery. Indeed, there was no record evidence that BWS in any way protested in paying more than the amount of the subcontract. Under the volunteer doctrine, or voluntary payment rule, BWS cannot, as a matter of law seek payments made voluntarily. This Court should REVERSE AND RENDER judgment in favor of the Appellants on this issues alone. 35 R.E. 128 at Trial Exhibits 2-4, R.E Complaint, R.E at

22 In the event that the Court holds that the volunteer doctrine does not apply, it should still REVERSE AND RENDER judgment in favor of appellants on the ground that the subcontract at issue specifically excluded the items which resulted in BWS paying more than $220, for fire protection. Finally, the trial court erred, as a matter of law, by awarding a judgment against A1 Fire Sprinkler, LLC, who was neither a party to the subcontract nor the litigation. -17-

23 CERTIFICATE OF SERVICE I, H. Richard Davis, Jr., one of the attorneys for the Defendant/Appellant, certify that I have this day filed this Brief of the Appellant with the clerk of this Court via the MEC system, which has caused a true and correct copy to be served on the following: Carey R. Varnado Brian R. Bledsoe MONTAGUE PITTMAN & VARNADO, P.A. 525 Main Street Hattiesburg, Mississippi cvarnado@mpvlaw.com bbledsoe@mpvlaw.com I have also served a true and correct copy of same by U.S. Mail, postage prepaid on the following non-mec participant: The Hon. Prentiss G. Harrell Circuit Court Judge P.O. Box 488 Purvis, Mississippi SO CERTIFIED, this the 19th day of January, 2016 /s H. Richard Davis, Jr. H. RICHARD DAVIS, JR. -18-