Opinion ID: 1830760
Heading Depth: 1
Heading Rank: 9

Heading: Decision of the Chancery Court

Text: ¶ 10. The chancellor found that as of the date the writs were served, the property in the hands of Four Rivers and Frio, which belonged to Fortenberry, was bound and subject to CPSC's judgment lien obtained against Fortenberry. Chancellor Middleton also held that Frio's liability to Fortenberry was established and not contingent. However, he found that the intent of the parties was for Fortenberry to pay the suppliers with the first $20,000 obtained from Frio, and that Fortenberry was not entitled to the remainder of the contract price until the lien releases from the suppliers were obtained. He found that neither law nor equity favored awarding CPSC the full contract amount of $41,950 free and clear of any expenses. ¶ 11. With respect to Four Rivers, the chancellor found that Mississippi law allowed a garnishee to setoff a claim he has against the principal debtor, but the debt must be due and enforceable at the time the garnishment process was served. Four Rivers' claim for setoff arose two days after the service of the writ of garnishment which, under the general rule, would normally not be allowed. In this case, the chancellor permitted the setoff under an exception which allows the setoff when the garnishee's claim arose from the very contract upon which his liability to the principal debtor accrued. ¶ 12. In sum, CPSC held a first-priority lien against the Frio contract in the amount of $12,122.34 ($41,950 less the $24,827.66 due the suppliers and the $5,000 cost associated with the removal of the drilling rig.) Under the Four Rivers contract, CPSC was entitled to $2,741.84 ($3,808.33 due under the contract minus the $1,066.39 setoff.) CPSC was entitled to receive a total of $14,864.18.