Opinion ID: 1791685
Heading Depth: 1
Heading Rank: 1

Heading: Whether an action for unliquidated damages can be executed upon by a judgment creditor and subsequently sold at public auction, possibly to a third party?

Text: ¶ 2. This is a case of first impression and requires the Court to consider Mississippi Code §§ 11-7-7, 13-3-127 and 13-3-135 and several opinions, including Hunt v. Preferred Risk Mut. Ins. Co., 568 So.2d 253, 255 (Miss.1990). ¶ 3. Maranatha argues that a levy of execution upon a chose of action is not authorized by Mississippi law. Further, Maranatha argued to the chancellor, that a writ of execution based on a judgment lien may only be applied to the proceeds of a lawsuit and not the lawsuit itself. Maranatha also suggested that a writ of garnishment was the proper method to collect on a judgment lien from an ongoing lawsuit and that, per William Iselin & Co. v. Delta Auction & Real Estate Co., 433 So.2d 911 (Miss.1983), a writ of execution cannot be applied to intangible property such as ongoing litigation. [4] The chancellor disagreed and held that under §§ 11-7-7, 13-3-127 and 13-3-135 a chose in action is subject to a writ of execution. ¶ 4. On appeal, Maranatha reasserts its earlier argument and claims that the chancellor's ruling is contrary to state law and unconstitutional according to Miss. Const., 1890, Art. 3, § 24. The Court disagrees. ¶ 5. We have previously defined the term chose in action. In Garrett v. Gay, 394 So.2d 321, 322 (Miss.1981), we relied on 73 C.J.S. Property § 9 (1951) to state: A chose in action means, literally, a thing in action, and is the right of bringing an action, or a right to recover a debt or money, or a right of proceeding in a court of law to procure the payment of a sum of money, or a right to recover a personal chattel or a sum of money by action, or, as it is defined by statute, a right to recover money or personal property by a judicial proceeding. ¶ 6. Generally, any chose in action is assignable after the suit is filed. Miss. Code Ann. § 11-7-7 (Rev.2004). See also Sneed v. Ford Motor Co., 735 So.2d 306, 311 (Miss.1999); Kaplan v. Harco Nat'l Ins. Co., 716 So.2d 673 (Miss.Ct.App.1998). Miss.Code Ann. § 11-7-7 provides in part: [that a]ny chose in action or any interest therein, after suit has been filed thereon, may be sold or assigned the same as other property, whether such claim or any interest therein was heretofore assignable under the laws of this state or not. (emphasis added). [5] Until the enactment of statutory law, such was prohibited under the common law. Kaplan, 716 So.2d at 676 (collecting authorities). ¶ 7. Maranatha seeks a narrow reading of the statutes germane to our review of assigning a chose in action. While it concedes that state law allows the assignment or sale of a chose in action, it maintains that because there is no explicit statute authorizing the execution of a judgment on a chose in action, such is not permitted. However, a reasonable interpretation of § 11-7-7 is that a chose in action may be transferred to the same extent as other property and therefore treated the same as other property. See Cartwright v. Deposit Guar. Nat'l Bank, 675 So.2d 847, 847 (Miss.1996) (citing Garrett v. Gay, 394 So.2d 321, 322 (Miss.1981) (the term personal property includes a chose in action.)). ¶ 8. We do not read statutes in isolation, but instead, we must construe our statutes together. Wilbourn v. Hobson, 608 So.2d 1187, 1191 (Miss.1992) (statutes which relate to the same subject matter must be read together to determine the mind of the Legislature). ¶ 9. The clear language of § 11-7-7, leaves little doubt that a writ of execution may be issued against a chose in action based on its status as personalty. Coupled with its authority to enact a statute that abrogates the common law rule, is the Legislature's ability to limit § 11-7-7. There is no indication that the Legislature sought or intended to limit § 11-7-7. Accordingly, save any statutory exceptions, there is no limitation on the execution of a chose in action. ¶ 10. Further supporting this premise is Miss Code Ann. § 13-3-135 (Rev.2002), which provides: The purchaser of any chose in action, stock, share, interest, judgment, or decree of the defendant, sold under execution or attachment, shall become the owner thereof, in the same manner as if it had been regularly assigned to him by the defendant. (emphasis added). This statute specifically addresses the rights of purchaser of a chose in action sold under execution. It expressly provides that a purchaser of a chose in action is on the same footing as one who received the chose via a more typical assignment. Implicit in § 13-3-135 is that a chose in action may be sold under execution. ¶ 11. Maranatha does not address why the Legislature would consider the rights of a party to a transaction that is prohibited under state law. Instead, as opposed to addressing the provisions of § 13-3-135, Maranatha focuses on the fact that § 13-3-127 only speaks to attachment and not execution. [6] ¶ 12. Miss.Code Ann. § 13-3-127 (Rev. 2002) provides: In case an attachment be levied on rights, credits, and choses in action, the officer shall take into his possession the books of accounts and other evidences of debt belonging to the defendant, and if the plaintiff so direct, he shall summon all persons appearing to be indebted to the defendant, or to have effects of his in their hands, as garnishees, in the manner prescribed by law. Maranatha makes two arguments regarding § 13-3-127. First, Maranatha stresses that § 13-3-127 speaks only to circumstances involving attachment. The Court agrees with Maranatha in that § 13-3-127 only addresses attachment. However, the fact that § 13-3-127 is limited to attachments in no way supports the argument that a chose in action is not subject to a writ of execution. The text of § 13-3-127 simply directs the seizing officer to take possession of certain items in circumstances of attachment. Because a statute addressing the procedure for attachment does not prohibit execution, it is irrelevant. ¶ 13. Maranatha further argues that it was improper for the chancery court to cite the statutory title in determining whether § 13-3-127 authorizes execution on choses in action. Maranatha is correct that in this instance it was improper to consider the heading while interpreting the statute. ¶ 14. In its opinion, the chancery court wrote: The title to § 13-3-127 reads: Levy of writs of execution and attachment- on choses in action. In the statute itself only the word `attachment' appears which is not exclusive of execution, as the levy of a writ of execution is an attachment of the chose in action. The opinion further relied on Gully v. Jackson International Co., 165 Miss. 103, 145 So. 905 (1933) wherein this Court, finding that the body of a privilege tax statute was incomplete, determined that headings enacted by the Legislature were in fact lead lines and to be considered part of the statute itself. 145 So. at 906. ¶ 15. Significantly in Gully the headings at issue were actually part of the enacted legislation and had been before the Legislature. Whereas in the instant case, the headings at issue are the product of the publisher and have never been considered by the Legislature. [7] Indeed, the user's guide supplied by Lexis-Nexis in the front of each volume of the Mississippi Code Annotated provides: STATUTE HEADINGS Headings or catchlines for Code sections and subsections are generally created and maintained by the publisher. They are mere catchwords and are not to be deemed or taken as the official title of a section or as part of the section. Your suggestions for improvements or particular catchlines are invited. Mississippi Code 1972 Annotated vol. 4, p. xii. [8] Accordingly, Maranatha's second argument regarding § 13-3-127 is without merit. ¶ 16. Before addressing Maranatha's arguments regarding judicial precedent, the Court finds that §§ 11-7-7 and 13-3-135 support our determination that under statutory law a chose of action is subject to a writ of execution. ¶ 17. We consider the chancery court's reliance on Hunt v. Preferred Risk Mutual Ins. Co., 568 So.2d 253 (Miss.1990). In Hunt, this Court stated that it is possible for a judgment creditor to levy execution on an insured's cause of action against an insurer and subsequently purchase such chose at a sheriff's sale. Id. at 253 n. 1. It is important to note that the footnote in Hunt is dicta and that the opinion fails to consider any of the aforementioned statutes. Instead, it relied on a treatise which is at best persuasive in circumstances such as this, that require this Court to consider state statutes on execution. Further reducing the persuasiveness of the footnote, is the fact that the appeal in Hunt raised issues involving conflict of interest and that the opinion rested on Hunt's lack of standing. Id. ¶ 18. A review of decisions by foreign jurisdictions reveals that there is no majority rule regarding whether a chose in action is subject to a writ of execution. See Cagle v. Butcher, 118 Ariz. 122, 575 P.2d 321 (1978) (Under statute, garnishment, and not execution, is proper remedy to reach debt represented by a chose in action.); O'Hern v. Donald, 256 So.2d 13 (Fla.Dist.Ct.App.1971) (Choses in action are subject to execution only when made so by statute or voluntarily given up to be sold on execution.); Prodigy Centers/Atlanta No. 1 L.P. v. T-C Associates, Ltd., 269 Ga. 522, 501 S.E.2d 209 (1998) (Under state statute, choses in action are not subject to seizure and sale save explicit exceptions.); Arbie Mineral Feed Co. v. Farm Bureau Mut. Ins. Co., 462 N.W.2d 677, 680 (Iowa 1990) (A cause of action is in existence prior to judgment and is personal property upon which, under Iowa law, a creditor may levy.); Applied Med. Techns., Inc. v. Eames, 44 P.3d 699 (Utah 2002) (Choses in action may ordinarily be acquired by a creditor through attachment and execution.). ¶ 19. In summing up the rationale that there was no valid reason to disallow a levy of execution against a chose of action, the learned chancellor in the case sub judice, in relying on a Washington Supreme Court case, stated it best: But why not? It is property. It is capable of being transferred. It is capable of being converted into a judgment which is subject to execution. It is an asset of the judgment debtor, and why should not his assets, whatever their nature, be taken to satisfy a judgment? We cannot see any logical reason why such property should not be levied on. Johnson v. Dahlquist, 130 Wash. 29, 225 P. 817, 818 (1924).