Unlock document.
This document is partially blurred.
Unlock all pages and 1 million more documents.
Get Access
fair-market value of Bluewater.
¶ 57. Only after Williford filed suit did Defendants attempt to reverse their super-majority decision. They took
the position that they had not really exercised their super-majority rights, but had only made an “offer” which they
hours”) that Williford's “status as a partner of Bluewater” had been “terminated.”
¶ 59. Of more concern, however, were Defendants' other actions that were wholly inconsistent with Williford's
rights as an LLC member. They changed the locks on the doors of the offices and notified Williford that “as of Jan-
uary 31, 2006 he [was] to cease and desist from performing any business on behalf of Bluewater.” He was to
refrain from use of any and all company assets, including, but not limited to the use of the company name, bank
¶ 61. Unless the members of a Mississippi LLC employ or appoint a manager to manage the LLC's business af-
fairs, “every member is an agent of the limited liability company for the purpose of conducting its business and af-
fairs....” FN35 The operating agreements of both Bluewater LLCs stated: “The management of the Company's busi-
ness shall be vested in the members.”
FN35. Miss.Code Ann. § 79–29–303(1) (Rev. 2009).
ties with respect to the subject matter of this Agreement.... This Agreement may not be amended or modi-
fied except with the consent of all members.”
[13] ¶ 63. An LLC operating agreement is contractual in nature and binding on the members of the compa-
ny.FN37 Bluewater's ouster of Williford was a formal company action taken according to the terms of the LLC operat-
ing agreement. The chancellor found that “[t]he Court was not provided with any credible official action taken by
© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.
¶ 64. The Court of Appeals found that “the remaining members communicated the rescission of the ouster to
Williford multiple times” in the form of letters their attorney sent well into the litigation, as well as by a motion to
dissolve the injunction which “clearly rescinded Williford's ouster.” We disagree.
¶ 65. Neither Bluewater nor the Court of Appeals identified any authority that allowed Bluewater unilaterally to
than an offer which could be rescinded later.FN38 In short, because there was no offer for Williford to accept, there
was no offer for Bluewater to rescind. And because the operating agreement contained no provision permitting the
majority members unilaterally to rescind the action, Williford's ouster could have been undone only by an official
company action.FN39
FN38. An option contract gives a clear right to the option holder, regardless of the wishes of the option giv-
¶ 67. But Defendants' argument fails for another reason. When they decided to exercise the super-majority pro-
vision and buy Williford's interest in the LLCs—and assuming they were within their rights to do so—they could
have made it effective either immediately, or at some future time. By choosing the former, they had every right to
exclude him from the business, but they had a companion duty to tender payment to him. Had they chosen the latter,
they had no right to exclude him from the business until they tendered payment.
[15][16] ¶ 69. Williford argues on cross-appeal that the chancellor erred in failing to award him reasonable at-
torney fees. While Williford is correct that attorney fees may be awarded in some cases of intentional breach of con-
tract and breach of fiduciary duty,FN40 that decision is within the chancellor's sound discretion.FN41
FN40. Barnes, Broom, Dallas & McLeod, PLLC v. Cappaert, 991 So.2d 1209, 1214 (Miss.2008) (citing
Garner v. Hickman, 733 So.2d 191, 198 (Miss.1999)).
© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.
CHANCERY COURT OF FORREST COUNTY IS REINSTATED AND AFFIRMED. THIS CASE IS RE-
MANDED TO THE CHANCERY COURT FOR PROCEEDINGS CONSISTENT WITH THIS OPINION.
CARLSON, P.J., RANDOLPH, LAMAR, KITCHENS AND CHANDLER, JJ., CONCUR. GRAVES, P.J., CON-
CURS IN RESULT ONLY. WALLER, C.J., CONCURS IN PART AND IN RESULT WITH SEPARATE WRIT-
TEN OPINION JOINED BY PIERCE, J.
WALLER, Chief Justice, concurring in part and in result:
¶ 78. Because I disagree with the majority opinion addressing Issue I procedurally and substantively, I concur in
part and in result with an otherwise excellent opinion.
I. Standard of Review
Miss. R.App. P. 28. All that we have is speculation that the chancellor did something (adopted Williford's findings
verbatim) that is not supported in the appellate record before this Court. Therefore, we should find no merit in its
argument without further discussion on the subtleties of standards of review. See Miss. R.App. P. 28; Wood v. Gulf
States Capital Corp., 217 So.2d 257, 273 (Miss.1968).
¶ 80. While the majority's discussion of our standards of review is unwarranted, two points must be emphasized.
¶ 81. I agree with the majority that we must carefully review cases and remain sensitive to errors. Maj. Op. ¶ 27.
No one disputes that. However, the issue is what deference chancellors should be afforded in their factual decisions
when the record calls into question the independent findings our trial judges are obligated to make. Deferring to a
chancellor's factual findings does not mean that we intend to neglect our judicial function. See Ralph Walker, Inc. v.
Gallagher, 926 So.2d 890, 893 (Miss.2006).FN47
(Miss.2005). This Court defers to a chancellor's findings unless the chancellor was “manifestly wrong, clearly erro-
neous, or applied the wrong legal standard.” Id.
II. Notice Pleading
¶ 83. Even though the Court of Appeals improperly relied on Barnes, French, and Tucker, those cases should
© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.
¶ 64. The Court of Appeals found that “the remaining members communicated the rescission of the ouster to
Williford multiple times” in the form of letters their attorney sent well into the litigation, as well as by a motion to
dissolve the injunction which “clearly rescinded Williford's ouster.” We disagree.
¶ 65. Neither Bluewater nor the Court of Appeals identified any authority that allowed Bluewater unilaterally to
than an offer which could be rescinded later.FN38 In short, because there was no offer for Williford to accept, there
was no offer for Bluewater to rescind. And because the operating agreement contained no provision permitting the
majority members unilaterally to rescind the action, Williford's ouster could have been undone only by an official
company action.FN39
FN38. An option contract gives a clear right to the option holder, regardless of the wishes of the option giv-
¶ 67. But Defendants' argument fails for another reason. When they decided to exercise the super-majority pro-
vision and buy Williford's interest in the LLCs—and assuming they were within their rights to do so—they could
have made it effective either immediately, or at some future time. By choosing the former, they had every right to
exclude him from the business, but they had a companion duty to tender payment to him. Had they chosen the latter,
they had no right to exclude him from the business until they tendered payment.
[15][16] ¶ 69. Williford argues on cross-appeal that the chancellor erred in failing to award him reasonable at-
torney fees. While Williford is correct that attorney fees may be awarded in some cases of intentional breach of con-
tract and breach of fiduciary duty,FN40 that decision is within the chancellor's sound discretion.FN41
FN40. Barnes, Broom, Dallas & McLeod, PLLC v. Cappaert, 991 So.2d 1209, 1214 (Miss.2008) (citing
Garner v. Hickman, 733 So.2d 191, 198 (Miss.1999)).
© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.
CHANCERY COURT OF FORREST COUNTY IS REINSTATED AND AFFIRMED. THIS CASE IS RE-
MANDED TO THE CHANCERY COURT FOR PROCEEDINGS CONSISTENT WITH THIS OPINION.
CARLSON, P.J., RANDOLPH, LAMAR, KITCHENS AND CHANDLER, JJ., CONCUR. GRAVES, P.J., CON-
CURS IN RESULT ONLY. WALLER, C.J., CONCURS IN PART AND IN RESULT WITH SEPARATE WRIT-
TEN OPINION JOINED BY PIERCE, J.
WALLER, Chief Justice, concurring in part and in result:
¶ 78. Because I disagree with the majority opinion addressing Issue I procedurally and substantively, I concur in
part and in result with an otherwise excellent opinion.
I. Standard of Review
Miss. R.App. P. 28. All that we have is speculation that the chancellor did something (adopted Williford's findings
verbatim) that is not supported in the appellate record before this Court. Therefore, we should find no merit in its
argument without further discussion on the subtleties of standards of review. See Miss. R.App. P. 28; Wood v. Gulf
States Capital Corp., 217 So.2d 257, 273 (Miss.1968).
¶ 80. While the majority's discussion of our standards of review is unwarranted, two points must be emphasized.
¶ 81. I agree with the majority that we must carefully review cases and remain sensitive to errors. Maj. Op. ¶ 27.
No one disputes that. However, the issue is what deference chancellors should be afforded in their factual decisions
when the record calls into question the independent findings our trial judges are obligated to make. Deferring to a
chancellor's factual findings does not mean that we intend to neglect our judicial function. See Ralph Walker, Inc. v.
Gallagher, 926 So.2d 890, 893 (Miss.2006).FN47
(Miss.2005). This Court defers to a chancellor's findings unless the chancellor was “manifestly wrong, clearly erro-
neous, or applied the wrong legal standard.” Id.
II. Notice Pleading
¶ 83. Even though the Court of Appeals improperly relied on Barnes, French, and Tucker, those cases should
