I N T H E SUPR EM E C O UR T O F M I SS I SS I PPI NO. 2 0 1 0 - CT - 0 1 6 6 4 - S CT W I LL I AM M ART I N FALK NER AND W

I FE, VAL ERI E J . FAL KNER v. J OH N E . STUBBS, J

R. d / b / a M I SS I SS I PPI POL YS TEEL ON W RI T OF CE RT I ORARI D A T E O F JU D G M E N T : 09/ 01/ 2010 TRI AL J UD GE: HO N. HEN RY L. LAC KEY COURT F ROM W HI CH APP EAL ED: CHI CKASAW COUNTY CI RCUI T COURT AT T OR NE Y F OR AP P E L L ANT S : J OHN P . F OX AT T OR NE Y F OR AP P E L L E E : GE NE BA RT ON NA TUR E OF THE C ASE: CI VI L - REA L PROPERTY DI S P OS I T I ON: T HE J UDGMENT OF T HE CO UR T OF AP P E AL S I S AF F I RMED . T HE J UDGMENT O F T H E C H IC K A S A W C O U N T Y C IR C U IT C O U R T IS R E V E R S E D A N D T H E C A S E IS R E M A N D E D - 03/ 07/ 2013 M OT I ON F OR RE HE AR I NG F I L E D: M ANDAT E I S S UE D: EN BA NC. CH AND LER, J UST I CE, FOR TH E COU RT: ¶1. J ohn Stubbs w as aw ar ded damages f orbr eac h of

contr actaf

t erhe s ued M art i n and V al er i e Fal knert o e nf

or ce a cons truct i on l i en on thei rhom e. T he C our tof A ppeal s af

f i r m ed t he ci r c ui tc ou r t ’ s j ud gmen t , bu tr e ve r s e d i t s a w a r d o f a t t orne y’ s f

e e s a nd pr e

j udgm ent i nt er es t , f

i ndi ng thatStubbs ’ s r ecove ry w as bas ed i n q u a n tu m m e ru it an d , th u s, a tt o rne y ’s

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fe e s a n d p re

ju d g m e n t in ter e st w e re u n a v a ilab le r e m e d ies . S tu b b s p e tit io n e d fo r c e rtio ra ri, arg u ing that the C o u rto f A p p ea ls fail ed to co n side r v ariou s statuto ry g rou n d s for a n aw ard o f att o rne y ’s fees a n d p rejud g m en t i n terest an d req u ested that w e re instate th e c ir cu itco u rt ’s aw ard. W e grant ed c ert i orar i on the is sue of prej ud gm ent i nter estand at t orney’s f ees. A l tho ug h the C ou rto f A pp eal s did not di scuss the st atutes S tub bs rai ses, w e fi nd that tho se statu tes p rov ide a n insu ffi cien t b asis for an aw ard of eith er pre jud g m en t interest o r att o rne y ’s f ees i n thi s cas e, and w e af f i r m the C our tof

A pp eal s ’ deci s i on and the j udgm entof the C h ic k a s a w C o u n ty C ir c u it C o u rt . FACTS ¶ 2 . In A p ril 2 0 0 0 , M a rtin F a lk n e r a n d Jo h n S tu b b s o ra lly a g re e d th a t S tu b b s w o u ld c o n stru c t a b a se m e n t fo r th e F a lk n e rs’ p lan n e d lo g -c a b in h o m e n e a r H o u sto n , M iss iss ip p i, ata t ot al cos tof

$25, 000. T he part i es had l i t t l e di s cus s i on conce rni ng the i t emi zed c os t s of the pr oj ect . Stubbs compl et ed the bas ementand r ece i ved f ul l compensa t i on f

orthatw or k. A f t erhe compl et ed the bas ement , the Fal kner s as ked Stubbs t o hel p them bui l d addi t i onal por t i ons of

the home “s t ep by s t ep. ” A tno t i m e w as ther e any w r i t t en agr eementbetw een Stubbs and the Fal kner s r egar di ng the s cope of the w or k t o be done orthe pr i ce Stubbs w as t o be pai d. Stubbs ’ s t es t i m ony w as t hathe agr eed t o under t ake the nonbas ementw or k att he c o s t o f h is a c tu a l tim e a n d m a te ri a l e x p e n s e s . ¶3 . B ef

or e agr eei ng t o the bas emen tw ork, the part i es d iscu ssed h o w m u ch the e n ti re ho m e w ou l d co stt o b uil d. M art i n F al kn er testi fi ed thatS tub bs t old hi m the en t i re house coul d be bui l tf

or$100, 000, w i th t he nonbas ementw or k cost i ng $75, 000. Stubbs m ai nt ai ned th a t h is e stim a te h a d b e e n th a t th e e n tire h o u se w o u ld c o st a t le a st $ 1 5 0 ,0 0 0 to $ 2 0 0 ,0 0 0 to

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compl et e, even though the Fal kner s al r eady ha d acqui r ed mostof the l ogs neede d fort he hom e. Stubbs t es t i f

i ed thathe t ol d the Fal kner s hi s hourl y l aborr at e w as $25 perhourpl us hal f thatamount f

ortr avel t i m e, w hi l e M art i n F al knerm ai nt ai ned he w as t ol d Stubbs ’ s l abor
w o u ld b e $ 1 8 p e r h o u r a n d th a t th e re w a s n o d isc u ss io n o f tra v e l ti m e . T h e p a rties ’ o n ly di s cus s i on o f t he t ot al pr i ce t o bui l d the home orof Stubbs ’ s hour l y r at e t ook pl ace dur i ng negot i at i ons t o bui l d the bas ement , a nd Stubbs ’ s l abora nd tr avel r at es w ere not di s cus s ed a g a in w h e n th e F a lk n e rs a s k e d S tu b b s to w o rk b e y o n d th e o ri g in a l b a s e m e n t a g re e m e n t. ¶4. Stubbs pr ovi ded no i nvoi ces ors t at ement s d uri ng the t i m e he w or ked on the hous e, buthe r ece i ved per i odi c advanc es or“dr aw s ” f r om the Fal kner s t o coverhi s expens es . W hen th e len g th a n d c o sts o f th e p rojec t su rp a ss e d th e F a lk n e rs’ e x p e c tatio n s, th e F a lk n e rs to ld Stubbs t o s t op w or k on the hous e. S tu b b s te stifie d th a t, up to th a t ti m e , the F a lk n e rs h a d p a id him $4 5, 84 0. 25 and that he w as ow ed $ 25 , 25 6. 43 forou t st and i n g c o st s. T he F al kn ers ’ pos i t i on w as that , bas ed on the $100, 000 t hey bel i eved t o be the t ot al cos tof the home and the amountof

w or k l ef tt o be done, they ac tual l y had overpai d Stubbs atthatpoi nt . ¶5. Stubbs f

i l ed a c ons truct i on l i en on the F al kner s ’ hom e and s ued the Fal kner s f or out s t andi ng cons truct i on cos t s . A f t era bench t r i al , the ci r cui tcourtf ound thatthe part i es had ent er ed i nt o and per f

or m ed an or al contr actfor Stubbs t o bui l d the bas ementf or$25, 000. F u r th e r , i tf

o u n d th a tth e F a l k n e r s h a d a s k e d S tu b b s t o c o n t i n u e t o wo r k o n th e h o me

“ w ith o u t a f

u ll u n d e rs ta n d in g o r w ri tte n c o n tr a c t,” and thatthe part i es had ent er ed an “ or al contrac tf

orthe purpos e of

cons truct i ng the dw el l i ng and the compens at i on w as not adequa t el y di s cus s ed. ” The ci r cui tcourtaw ar ded Stubbs the val ue of “hi s s ervi ces , t he s ervi ces of

hi s w or km en, tr avel expens e and m at eri al s pur chas ed by Pl ai nt i f f f orthe

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d w e lli n g ,” w ith Stubbs ’ s and hi s w or km en’ s hour l y l aborand tr avel r at es det erm i ned on a q u a n tu m m e ru it

b a s is . In a d d iti o n , the c irc u it c o u rt a w a rd e d S tu b b s p re ju d g m e n t an d p o stjud g m en t i n terest at th e ra te of e igh t p erc en t eac h , alon g w ith the c o st of S tub b s’s att o rne y ’s fe e s , w h ic h to ta le d n e a rl y $ 2 0 ,0 0 0 . T h e fin a l ju d g m e n t ex p lic itly sta ted th a t “P lain tiff is en ti tl ed to attorn ey fee s, p re-jud g m en t i n terest an d p o st- jud g m e n t i n terest f

o r D efe n d an t’ s br eac h of

the or al contr act , ” and i tm ent i oned onl y a monet ary aw ar d bas ed on the br eac h of co n tr ac t. Itd id n o t i n clud e a n y p rov isi o n for the sa le o f the p rop erty o r ex ec u ti o n o f S tub b s’s l i en. ¶6. T he C our tof

A ppeal s uphel d the ci r cui tcourt ’ s j udgm entw i t h t he exce pt i on of t he aw ar d of att orney’ s f

ees and pr ej udgm enti nt er es t . B eca us e the ci rcui tco ur thad us ed q u a n tu m m e ru it

t o det erm i ne Stubbs ’ s hourl y fe e, the C our tof A ppeal s hel d that“the i ns t ant cas e i nvol ves a contr acti m pl i ed i n l aw . . . and i s , ther ef or e a qua ntum m er i ts ui t , ” s uch that

“ th e c ir c u it c o u rt ’s a w a rd o f p re -j u d g m e n t in te re s t a n d a tto rn e y ’s fe e s w a s im p ro p e r.” Stubbs pet i t i oned f

orcert i or ar i , ar gui ng thatthe C our tof A ppeal s had f

ai l ed t o cons i der
w h e th e r t h e re w a s a s ta tu to ry b a s is fo rt h e c ir c u it c o u rt ’s a w a rd o f t h e s e re m e d ie s . W e gr ant ed cert i orar i sol el y to det erm i ne w hetherthese st atutes supp ortan aw ard of prej ud gm ent i nter estand at t orney’s f ees. S TANDA RD O F REVI EW ¶7. O n appea l , w e gi ve a c i r cui t - courtj udge pr es i di ng i n a benc h tr i al “the s ame def er ence w i th r egar d t o hi s f i ndi ngs a s a cha ncel l or . ” Cit y of Jac kson v. P erry , 764 So. 2d 373, 376 ( M i s s . 2000) . T her ef or e, w e r evi ew the ci r cui tcourt ’ s i nt erpr et at i on and appl i cat i on of

the l aw de novo, and i t s f i ndi ngs of

f actw i l l notbe r ever s ed i f s uppor t ed by

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s u b s ta n tia l e v id e n c e . In re E sta te o f S m ith , 6 9 S o . 3 d 1 , 4 ( M is s . 2 0 1 1 ). T he s t andar d f or r evi ew i ng both a n a w ar d of pr ej udgm enti nt er es ta nd a t t orney’ s f ees i s abus e of

di s cr et i on. I d. ; B a ile y v. E s ta te o

f K e mp , 9 5 5 S o . 2 d 7 7 7 , 7 8 7 (M iss. 2 0 0 7 ).

DI S CU S S I ON ¶8. T he C ou rtof A pp eal s revers ed the aw ard of p rej ud gm ent i nter estan d att orney’s f ees, hol di ng thatStubbs s houl d r ecove rs ol el y undera contr acti m pl i ed i n l aw . If thi s w er e s o, Stubbs w oul d notbe ent i t l ed t o att orney’ s f ees orpr ej udgm entint er es tunderourpr i or d e c is io n s . S o u th la n d

E n ters., In c . v. N

e w to n Co u n ty , 838 So. 2d 286, 291 ( M i s s . 2003) ( hol di ng that“a s ui tbas ed on quantum m er i tpre cl udes r ecove ry of pr ej udgm enti nt er es tand att orney f

ees ”) . Stubbs ar gues thatthi s i s nota ca s e bas ed i n q u a n tu m m e ru it atal l , butt hat th e c ir c u it ju d g e fo u n d th e re w a s a n o ra l c o n tr a c t. ¶9. T he j udgm enti ndi cat es t he ci r cui tj udge appl i ed q u a n tu m m e ru it onl y t o f

i x t he d is p u te d r a te f

o r S tu b b s ’s la b o r a n d tr a v e l tim e . T he aw ar d of da m ages , a nd es peci al l y of att orney’ s f

ees and pr ej udgm enti nt er es t , w as expl i ci t l y bas ed on the Fal kner s ’ br eac h of an o ral co n tr ac t, no t a co n tr ac t im p li ed i n l aw . T h e circu itco u rt ’s f ind ing s of fac t w ere s uppor t ed by s ubs t ant i al evi dence and s houl d notbe overturned. H ow ever , w e f i nd no appl i cabl e s t atut ory bas i s f orthe ci r cui tcourt ’ s aw ar d of att orney’ s f

ees orpr ej udgm ent in ter e st e v e n if S tu b b s’s re c o v e ry is b a se d so lely o n a n e x p re ss c o n tr a c t ra th e r th a n in q u a n tu m m e ru it . 1. P rejud gm en t I n teres t ¶10. Stubbs cont ends t he aw ar d of prej ud gm enti nt er es tw as j us t i f i ed underM i s s i s s i ppi C ode Sect i on 87- 7- 3, w hi ch al l ow s fori nt er es tpenal t i es f orl at e payment s t o a contr act or

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w h o h a s m a d e im p ro v e m e n ts to re a l e sta te. I n re lev a n t p a rt, i t p ro v id e s th a t “f in a l p a y m e n ts o f all m o n ies o w e d co n tra c to rs s h a ll b e d u e an d p a y a b le . . . [w ]he n th e o w n e r b e n e fic ially us es oroccupi es t he pr oj ect , ”and that“[ i ] f the contr act ori s notpai d i n f ul l w i thi n thi r ty ( 30) c a le n d a r d a y s fr o m [th e tim e p a y m e n t is d u e ], th e n th e fi n a l p a y m e n t sh a ll b e a r i n te re s t . .

. att he r at e of

one per cent( 1% ) perm onth unt i l f ul l y pai d. ” M i s s . C ode. A nn. § 87- 7- 3 ( R ev. 2 0 1 1 ). ¶11. A l though notexpr es s l y s t at ed, the ci r cui tcourtappear s t o have r el i ed on M i s s i s s i ppi C o d e S e c tio n 7 5 -1 7 -1 , w h ich p ro v id e s fo r e ig h t p e rc e n t in ter e st o n a ll c o n tr a c ts a b se n t a w ri t t en p rovi si on o therw i se. U nd er our previ ou s cases , an aw ard of prej ud gm ent i nter est u n d er S ec ti o n 7 5 -17 -1 w oul d be i m pr operw her e a c l ai m f ordamages i s unl i qui dat ed. Moel lerv. Am . G uar. & L iab. I ns. Co. , 8 1 2 S o . 2 d 9 5 3 , 9 5 9 -60 (M iss. 2 0 0 2 ). D am ag es a re u n li q u idated if

they are n o t se t f

o rth in the term s o f th e c o n tr ac t i tsel f, o r i f th ey are “es t abl i s hed by a ve r di ctoraw ar d butcannotbe det erm i ned by a f i xed f or m ul a. ” I

d . W h ile a j udge has di s cr et i on t o aw ar d pr ej udgm enti nt er es t , “no aw ar d of pr ej udgm enti nt er es tm ay ra tio n a lly b e m a d e w h e re th e p ri n c ip a l a m o u n t h a s n o t b e e n fi x e d p r io rt o ju d g m e n t.” S to c kstill v. G a m m ill , 943 So. 2d 35, 50 ( M i s s . 2006) ( quot i ng Coho Res . , I nc . v. Mc Car t

hy , 8 2 9 S o . 2 d 1 , 1 9 -2 0 (M is s . 2 0 0 2 )) . ¶12. N e ith e r S ec ti o n 7 5 -17 -1 norSect i on 87- 7- 3 m ent i ons w hetherm oni es ow ed contr act or s m us tbe l i qui dat ed i n or derf orthe r es pect i ve s t atut e’ s gr antof pr ej ud gm ent i nt er es tt o appl y. H ow ever , the s ame cons i der at i ons w hi ch pr ecl ude a r ecove r y of p rejud g m en t i n terest for u n li q u idated a m o u n ts ow ed u n d er S ec ti o n 7 5 -17 -1 a ppl y t o Sect i on 87- 7- 3. T her ef

or e, Stubbs musts how thathi s c l ai m s a gai ns tthe Fal kner s w ere l i qui dat ed

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p ri o r t o th e ju d g m e n t in o rd e r t o re c o v e r p re ju d g m e n t in te re s t u n d e r e ith e r s ta tu te . ¶13. T h e am o u n t of

S tu b b s’s cla im w a s c lea rly in d isp u te, a n d the tri a l co u rt res o rte d to q u a n tu m m e ru it t o f

i x the exac tam ountof

Stubbs ’ s damages . T her e has been no f i ndi ng t hat the F al kn ers dis pu t ed the am ou nt ow ed i n bad fai th, an d w e m ake no ne today . T he F al kn ers ’ act i ons w er e cons i s t entw i th a bel i ef thatthey had be en over char ged and w i th the tr i al j udge’ s f i ndi ng that“ compensa t i on w as notadequa t el y di s cus s ed. ” W e pr evi ous l y h a v e h e ld thatw her e “ther e i s a bona f i de di s put e as t o the amo un to f dam ages as w el l as t he re sp o n sib ili ty fo r th e liab ili ty th e re fo r,” a c laim is u n liq u id a ted an d p re ju d g m e n t in ter e st is
u n a v a ila b le . Moel

lerv. A m . G uar. & L iab. I ns. Co. , 812 So. 2d 953, 960 ( M i ss. 2002) ( quot i ng Sim

ps on v. State Far m Fir e & Cas . Co. , 5 6 4 S o . 2 d 1 3 7 4 , 1 3 8 0 (M iss . 1 9 9 0 )). B e c a u se th e a m o u n t o f S tu b b s’s c laim w a s u n liq u id a ted a t th e tim e p a y m e n t w a s d u e , h e is
n o t en tit led to p re

ju d g m e n t in ter e st. 2. A t t orney’ s F ees ¶14. S tu b b s ’s c la im th a t h e is e n title d to h is re a s o n a b le a tto rn e y ’s fe e s a ls o f a ils . W e pr evi ous l y have s t at ed thatatt orney’ s f ees ar e a s peci al r emedy avai l abl e onl y w hen e x p re ss ly p ro v id e d fo r in e ith e r a sta tu te o r c o n tra c t, or w h e n th e re is s u ffic ien t p ro o f to a w a rd p u n itiv e d a m a g e s . Stanton & A ssocs. , In c. v. B r yant Const r. Co. , I nc. , 464 So. 2d 4 9 9 , 5 0 2 (M iss . 1 9 8 5 ); see al so McL ain v. W

. S ide B on e & J

oint Ctr. , 656 So. 2d 119, 123 (M iss . 1 9 9 5 ) (“ N o rm a lly , atto rn e y ' s fe e s a re n o t g ra n ted u n les s a s ta tu te o r o th e r a u th o rity so p rov ides . ”). ¶15. Stubbs r el i es on M i s s i s s i ppi C ode Sect i on 85- 7-181 as the bas i s f orhi s r ecove r y of a tto rn e y ’s f

e e s. W h ile th is s tatu te d o e s p ro v id e fo r a tto rn e y ’s f e e s, it is in a p p lica b le to th is

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cas e. T hi s “s t op- not i ce” s t atut e w as des i gned t o provi de a r emedy f orsubcontr act or s – w ho ar e exc l uded f

r om the pr ot ect i on of

M i s s i s s i ppi ’ s cont r act or ’ s l i en st atut e – by f or ci ng t he ow nerof a pr oj ectt o w i thhol d funds due t o a contr act orw hen thatcontr act orr ef us es t o pay th e su b c o n tra c to r. M iss . C o d e A n n . § 8 5 -7 -1 8 1 (R e v . 2 0 1 1 ). M o re o v e r, th e F ifth C irc u it C our tof A ppeal s r ece nt l y hel d thi s s t atut e i s f aci al l y uncons t i tuti on al i n N oatex Cor

p. v. KingCon s tr. o

f Ho us to n, LLC , 864 F. Supp. 2d 478 ( 5th C i r . 2012 ) ( hol di ng t hat “M i s s i s s i ppi ’ s s t op not i ce s t atut e vi ol at es due pr oces s by author i zi ng w hati s i n pr act i cal ef f ec tthe p r e

j ud gmen ta t t a c hmen to f f un ds wi tho utp r i orn ot i c e a nd a h e a r i ng, oran a c c e p ta b le p o s t- s e iz u re re m e d y .” ). A s thi s s t atut e i s nei t her ap pl i cabl e norenf or cea bl e, S tu b b s is n o t e n title d to a tto rn e y ’s fe e s u n d e r i ts p ro v is io n s . ¶16. Stubbs actual l y s tyl ed hi s i ni t i al c ons truct i on l i en agai ns tthe Fal kner s ’ hom e under Sect i on 85- 7- 181, r athert han undert he contr act or ’ s l i en st atut es cont ai ned i n Sect i ons 85- 7- 131 thr ough 8 5 -7 -1 5 7 . A tto rn e y ’s fees a re a v ail ab le un d er Sect i on 85- 7- 151 , w hi ch provides: In c a se ju d g m e n t b e g iv e n fo r th e p lain tiff ag a in st th e b u ild e r itsh a ll . . . w ith c o s ts , a s in o th e r c a s e s , a n d w ith a tto rn e y ' s fe e s a s p ro v id e d b e lo w , a n d w ith a s p e c ia l o rde r fo r th e s a le o f th e p ro p e rty u p o n w h ich th e lien e

x ists f orthe paymentther eof

and f oran exe cut i on, as i n otherc as es , f orthe r es i due of

w hat m ay r emai n unpai d, af

t erthe s al e of

the pr operty. M is s . C o d e A n n . § 85- 7- 151 ( R ev. 2011) ( emphasi s added) . E ven t ho ugh S tubbs br ought thi s act i on t o enf

or ce hi s cont r act or ’ s l i en, t he ci r cui tcour tent er ed j udgm entforbr eac h of contr actonl y and m ade no pr ovi s i on f orthe s al e of

the Fal kner s ’ pr operty t o s at i s f y t he j udgm ent . W e not e thatthe f i nal j udgm enti n thi s cas e w entthr ough atl eas ttw o r evi s i ons a n d w a s d ra fte d b y S tu b b s’s c o u n se l w ith o u t a n y m e n tio n o f th e lie n ’s e n fo rc e m e n t o r sa le

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o f th e F a lk n e rs’ p ro p e rty . H a v in g re c o v e re d o n ly d a m a g e s o w e d u n d e r a b re a c h o f c o n tra c t, Stubbs i s notent i t l ed t o the att orney’ s f ees pr ovi ded f

orunderSect i on 85- 7- 151 i n an act i on t o enfor ce a contr act or ’ s l i en . G ar nerv. H i ckm an , 73 3 So . 2d 19 1, 19 8 ( M i s s . 1999) ( pr ecl udi ng r ecove ry of att orney’ s f ees underSect i on 85- 7- 151, even though pl ai nt i f f had fi le d s u c h a lie n , w her e pl ai nt i f f s ued onl y f

orbr eac h of

c ontr actbutdi d nots ue t o enf or ce th e c o n tr a c to r’ s lie n ). CO NC L US I ON ¶17. Fi ndi ng no s t atut ory bas i s f oran aw ar d of

ei t heratt orney’ s f

ees orpr ej udgm ent i nt er es t , w e hol d thatthe ci r cui tc our ta bus ed i t s di s cr et i on i n a w ar di ng s uch t o Stubbs . For t hese re as ons , w e af

f i r m the dec i s i on of

the C our tof

A ppeal s and r emand t he ca s e t o t he ci r cui tcourtf

ora f i nal det erm i nat i on of

Stubbs ’ s aw ar d w i thoutp rej udgm enti nt er es tor a tto rn e y ’s fe e s . ¶18. T HE J UD GMEN T OF T HE CO UR T OF AP P E AL S I S AF F I RMED . T HE J UDG M ENT OF TH E CH I CK ASAW CO UNTY CI RCU I T COU RT I S REVERSED AND T HE CA S E I S RE M ANDE D. W A L L E R , C . J. , D I C K I N SO N A N D R A N D O LP H , P. JJ . , LA M A R , K I TC H EN S, P I ER CE , KI NG AND COL EM AN, J J . , CONCUR .