Opinion ID: 1596666
Heading Depth: 2
Heading Rank: 1

Heading: Whether the chancellor erred in granting McKnight's motion to dismiss.

Text: ¶ 9. This Court uses a de novo standard of review when considering the grant or denial of a motion to dismiss. Harris v. Miss. Valley State Univ., 873 So.2d 970, 988 (Miss.2004). In considering such motions, the allegations in the complaint must be taken as true, and the motion should not be granted unless it appears beyond a reasonable doubt that the plaintiff will be unable to prove any set of facts in support of his claim. Id. (citing T.M. v. Noblitt, 650 So.2d 1340, 1342 (Miss. 1995)). ¶ 10. We find that Section 31-5-41 is itself dispositive of this case. The last sentence of the statute states that its provisions do not apply to construction bonds. Miss.Code Ann. § 31-5-41 (Rev. 2008). A performance bond is a type of construction bond. See Morgan v. U.S. Fid. & Guar. Co., 191 So.2d 851, 852 (Miss. 1966) (referring to performance and payment bonds as construction bonds); Alexander v. Fid. & Cas. Co., 232 Miss. 629, 633, 100 So.2d 347, 348 (Miss.1958) (describing a performance bond and then indirectly equating it to a construction bond); see also Roger P. Sauer, Kevin J. Russell, & James E. Rudwick, Performance Bonds, in 2 Construction Law Handbook § 35.03, at 1278 (Robert F. Cushman & James J. Myers eds., Aspen Law & Business 1999) ([t]he two main construction bonds are performance bonds and payment bonds). Section 31-5-41 then, by its own language, excepts performance bonds. This remains true even if the performance bond incorporates the construction contract by reference. Performance bonds routinely incorporate the pertinent construction contract by reference. Benjamin D. Lentz, Default, Notice of Default, Impact Upon Surety's Obligations Where Notice Is Not Given, in The Law of Performance Bonds at 21-22, (Lawrence R. Moelmann & John T. Harris eds., ABA 1999); David C. Dreifuss, Bond, Contractual, and Statutory Provisions and General Agreement of Indemnity, in Bond Default Manual, Second Edition at 5 (Duncan L. Clore ed., ABA 1995). The most commonly used performance bond forms include such language. See Deborah S. Griffin, Completion by the Bond Obligee, Bond Default Manual, Second Edition at 212-13 (Clore ed., ABA 1995); Bond Default Manual, Second Edition at app. 421, 423 (Clore ed., ABA 1995). Incorporation by reference simply indicates that the bond and construction contract set forth mutually interdependent rights and obligations, and that the two documents must be construed together. See State for Use of Nat'l Sur. Corp. v. Malvaney et al., 221 Miss. 190, 209-10, 72 So.2d 424, 431 (1954). ¶ 11. Because Section 31-5-41 exempts construction bonds from its application, the chancellor erred in granting McKnight's motion to dismiss.