Major Hammett, II v. Michael D. Atcheson Michael D. Atcheson, Trustee of the Michael Dean Atcheson Trust , 2014 Mo. App. LEXIS 848 ( 2014 )

MISSOURI COURT OF APPEALS
WESTERN DISTRICT
MAJOR HAMMETT, II, )
) WD75551 and
Appellant-Respondent, ) WD75586
v. )
) OPINION FILED:
MICHAEL D. ATCHESON; )
MICHAEL D. ATCHESON, ) August 12, 2014
TRUSTEE OF THE MICHAEL )
DEAN ATCHESON TRUST, )
)
Respondent-Appellant. )
Appeal from the Circuit Court of Jackson County, Missouri
Honorable Michael W. Manners, Judge
Before Division Three: Gary D. Witt, P.J.,
Joseph M. Ellis, and Thomas H. Newton, JJ.
Mr. Major Hammett, II, appeals the denial of the motion to amend the
judgment for an award of attorney fees. Mr. Michael D. Atcheson, as an
individual and a trustee of the Michael D. Atcheson Trust (Atcheson Parties),
cross-appeals the denial of the motions for a directed verdict and judgment
notwithstanding the verdict. We affirm in part, reverse in part, and remand for
a new trial solely on the issue of damages.
Factual and Procedural History
The following facts were adduced at trial. In 2005, Mr. Hammett began
working with the City of Bolivar and the Tax Increment Financing Commission
(TIF Commission) on a real estate development and investment opportunity
known as the Simon Square Development Project (Simon Square). Mr.
Hammett then entered into a “50-50 partnership” on the project with Mr.
Atcheson, a prominent local developer.
In February 2006, Simon Square was organized as “Simon Square
Development, LLC,” with Messrs. Hammett and Atcheson as the organizers.
On the day Simon Square was organized, Mr. Hammett and Mr. Atcheson (as
trustee of the Atcheson Trust) also executed an Operating Agreement, which
listed them each as members with a 50% ownership interest. Mr. Hammett and
the Atcheson Trust were to vote equally in all Simon Square matters. The
development project, which included space allocations for retail and office
space, lodging, and single-family residences, was estimated to cost more than
$89 million to complete.
Mr. Hammett testified that, later in 2006, Mr. Atcheson advised him that
another partner would need to be added for access to additional funding. Mr.
Atcheson recommended adding his business partner, Mr. Larry Haas, to the
partnership. Mr. Haas was added, and the trio entered into a Restated
Operating Agreement (ROA), wherein Messrs. Hammett and Haas and the
Atcheson Trust were listed as equal members with a one-third ownership
2
interest. Mr. Hammett testified that he was not provided an advance copy of
the ROA before the meeting to sign it. He testified that, except for the addition
of Mr. Haas, he did not know the terms of the agreement had changed.
Under the ROA, Mr. Atcheson was designated Simon Square‟s “first
Manager,” which granted him “full and complete authority, power[,] and
discretion to manage and control the business.” Mr. Haas was designated the
company‟s “Tax Matters Member,” thereby serving as its accountant, tax
preparer, Secretary, and Treasurer. Additionally, the ROA included a provision
that permitted members to contribute additional capital “deemed necessary for
the operation of the company,” and, for members who did not provide
additional capital in proportion, their ownership interest would be diluted. 1
The three men also executed a Buy-Sell Agreement, which, among other terms,
required thirty days‟ written notice to all members before company shares
could be transferred.
In 2008, Mr. Haas transferred his shares to the Atcheson Trust without
providing the requisite notice to Mr. Hammett. The Atcheson Trust then held a
majority interest in Simon Square. As First Manager of Simon Square and
trustee of the Atcheson Trust, Mr. Atcheson purportedly began to wield his
authority for personal benefit. According to Mr. Hammett, Mr. Atcheson‟s
1
In the original Operating Agreement, capital could only be contributed with approval from the
executive committee, which was comprised solely of Messrs. Hammett and Atcheson. Mr. Hammett
testified that his company, Major Saver, was $2.2 million in debt at the time that he entered into the
Simon Square partnership with Mr. Atcheson, and that the dilution of ownership provision in the
ROA was created as an attempt to remove him from the partnership due to Mr. Atcheson‟s knowledge
of his inability to provide additional capital.
3
actions included: paying himself a developer fee of $500,000 against Mr.
Hammett‟s objection; using his own construction, landscaping, and realty
companies for company business and paying them in excess of fair market
value for services rendered; paying Mr. Atcheson‟s personal legal fees; and
making political campaign contributions.
Mr. Hammett filed suit against the Atcheson Parties, 2 asserting five
claims. First, he sued Mr. Atcheson as a trustee for breach of the Buy-Sell
Agreement. Second, he asserted a claim against Mr. Atcheson as an individual
for breach of the Restated Operating Agreeement. Third, he asserted a claim
against Mr. Atcheson as an individual for breach of fiduciary duty. Fourth, he
asserted a claim against Mr. Atcheson as an individual for fraud. Lastly, Mr.
Hammett sued Mr. Atcheson as a trustee for fraud.
A jury trial was held in 2012. The jury unanimously found in favor of
Mr. Hammett on all five counts and assessed damages of $280,650. The
damages were not apportioned to each count, but instead comprised a general
award. The jury found that the Atcheson Parties were not liable for punitive
damages. In the judgment, the trial court assessed damages and costs to the
Atcheson Parties, but did not award attorney fees.
Mr. Hammett filed a post-trial motion to amend the judgment to include
attorney fees, court costs, and restoration of himself as a 50% owner of Simon
2
In the petition, Mr. Hammett also filed suit against Mr. Haas, along with attorneys who represented
Mr. Atcheson and Simon Square. Mr. Haas and other parties settled and were dismissed from the
suit. The settlement amounts do not appear in the record.
4
Square. He requested that the award be increased to $574,837.41 to include
attorney fees totaling $293,895.41. 3 The Atcheson Parties filed post-trial
motions for JNOV and a new trial. The trial court allowed ninety days to lapse
without ruling on the motions, and they are deemed denied. 4 Mr. Hammett
appeals, and the Atcheson Parties cross-appeal.
Standard of Review
Issues of contractual interpretation are reviewed de novo. Brown v.
Brown-Thill, No. WD76778, 2014 WL 1677849, at *3 (Mo. App. W.D. April
29, 2014) (internal quotation marks and citation omitted). “The standard for
reviewing a denied motion for JNOV is essentially the same as for reviewing
the denial of a motion for directed verdict.” Peel v. Credit Acceptance Corp.,
408 S.W.3d 191, 204 (Mo. App. W.D. 2013) (internal quotation marks and
citation omitted). “[G]ranting a motion for JNOV is a drastic action and should
only be granted when reasonable persons could not differ on the correct
disposition of the case.” Id. To be submissible, there must be “legal and
substantial evidence [that] supports each fact essential to liability.” Id.
Whether a case is submissible is a question of law that we review de novo. Id.
3
When adding the damage award and Mr. Hammett‟s reported attorney fees, the total equals
$574,545.41, a difference of $292 less than Mr. Hammett requests. In addition to attorney fees, he
claims to have paid court costs of $3,547.12 (a $292 filing fee, pl us $3,255.12 in deposition costs)
and $7,400 in expert witness fees. Presumably, the difference of $292 reflects the filing fee.
4
Pursuant to Rule 81.05(a)(2)(A), “If a party timely files an authorized after -trial motion, the
judgment becomes final . . . [n]inety days from the date the last timely motion was filed, on which
date all motions not ruled [sic] shall be deemed overruled.” The last timely motion was filed by the
Atcheson Parties on May 14, 2012. Mr. Hammett filed a motion on May 11, 2012. Therefore, all
motions were deemed denied on August 13, 2012.
5
In our determination of whether evidence sufficiently supports the jury‟s
verdict, we view it “in the light most favorable to the verdict and the plaintiff is
given the benefit of all reasonable inferences.” Id.
Whether a jury was instructed properly is a question of law that we
review de novo. Kopp v. Home Furnishing Ctr., LLC, 210 S.W.3d 319, 328
(Mo. App. W.D. 2006). We are “only obliged to determine whether there was
evidence from which such verdict could have been reached by a jury composed
of reasonable men and women.” Envtl. Energy Partners, Inc. v. Siemens Bldg.
Technologies, Inc., 178 S.W.3d 691, 698 (Mo. App. S.D. 2005) (internal
citations omitted). We “will reverse the jury‟s verdict for insufficient evidence
only where there is a complete absence of probative facts to support the jury‟s
conclusion.” Peel, 408 S.W.3d at 204.
Legal Analysis
The Atchesons Parties’ Cross-Appeal
We will address the Atcheson Parties‟ cross-appeal first because it is
dispositive. The Atcheson Parties raise six points. In the first point, they argue
that the trial court erred in denying the motions for a directed verdict and
JNOV. They assert: (1) the Buy-Sell Agreement, under Section 1.4, permitted
Mr. Haas to transfer his units to the Atcheson Trust without Mr. Hammett‟s
consent; (2) any duty claimed under the agreement to provide notice was
attributable to Mr. Haas as the seller and not to the Atcheson Trust as the buyer;
and (3) Mr. Hammett submitted a fraud claim in 2006, in which he requested to
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be restored to his previous position as a 50% owner of Simon Square, which
would invalidate the agreement. They further contend that Mr. Hammett
cannot claim that the agreement is void and later assert rights to benefits
contained therein.
When interpreting contracts, the primary rule “is to ascertain the parties‟
intent and give effect to that intent.” Exec. Bd. of Mo. Baptist Convention v.
Windermere Baptist Conference Ctr., 280 S.W.3d 678, 687 (Mo. App. W.D.
2009) (internal quotation marks and citation omitted). To ascertain this intent,
we look to “the plain and ordinary meaning of the words in the contract and
consider the document as a whole.” Id. (internal quotation marks and citation
omitted). Section 1.4 of the Buy-Sell Agreement states, in relevant part:
1.4 Permitted Transferees. Notwithstanding the restrictions on
transfer contained in this Agreement, a Member shall have the
right, during lifetime or at death, without obtaining the consent of
the other Members, to sell, assign or transfer his Units to the
following persons or entities (“Permitted Transferee”):
a. any other member
However, section 5.1 of the Buy-Sell Agreement states, in relevant part:
5.1 Notice of Withdrawal. Any Member . . . desiring to sell,
assign or otherwise transfer any or all of his Company Units . . .
shall, at least (30) days prior to the date he desires to transfer his
Units, provide written notice . . . to the Company and the other
Members of his desire to sell such Units.
Based on the plain and ordinary meaning of these sections of the Buy-
Sell Agreement, it is clear that the agreement permits intra-member unit
transfers without consent, but it requires a 30-day written notice beforehand by
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the transferor. Section 5.1 is silent as to the notice requirements of transferees.
Thus, the transfer of units by Mr. Haas to the Atcheson Trust without first
providing a 30-day written notice to Mr. Hammett was a violation of the Buy-
Sell Agreement by Mr. Haas. Mr. Hammett‟s request to be restored as a 50%
owner of Simon Square is immaterial to the validity of the existing Buy-Sell
Agreement or the ROA. The first point is granted.
In the second point, the Atcheson Parties argue that the trial court erred
in denying the motions for a directed verdict and JNOV, in that the court
submitted Mr. Hammett‟s 2006 and 2008 fraud claims to the jury when Mr.
Hammett “failed to submit any evidence that [Mr.] Atcheson‟s statements in
July 2006 were false.” Specifically, the Atcheson Parties challenge jury
instructions 11 and 12, which pertain to the 2006 and 2008 fraud claims,
respectively. They contend that Mr. Hammett failed to establish the existence
of fraud because “each element was not supported by substantial evidence,”
and Mr. Hammett “cannot rely on statements directly contradicted by the
written agreement.” Jury Instructions 11 and 12 read as follows:
Jury Instruction 11
On his claim for fraud, your verdict must be for Plaintiff
against Defendant, Michael D. Atcheson, if you believe:
First, Defendant, Michael D. Atcheson, represented that
Simon Square Development, LLC, needed to add Larry Haas as a
member for Larry Haas‟ financial resources, and
8
Second, such representation was made by Defendant,
Michael D. Atcheson, with the intent that Plaintiff rely on such
representation in agreeing to add Larry Haas as a member, and
Third, the representation was false, and
Fourth, Defendant, Michael D. Atcheson, knew it was false,
and
Fifth, the representation was material to Plaintiff‟s
agreement to adding Larry Haas as a member of Simon Square
Develoment, LLC, and
Sixth, Plaintiff relied on the representation in agreeing to
adding Larry Haas as a member of Simon Square Development,
LLC, and
Seventh, as a direct result of such representation, Plaintiff
sustained damage.
Jury Instruction 12
On his claim for fraud, your verdict must be for Plaintiff
against Defendant, Michael D. Atcheson, Trustee, if you believe:
First, Defendant, Michael D. Atcheson, Trustee, represented
to Plaintiff that he paid a significant amount for the shares from
Larry Haas, and
Second, such representation was made by Defendant,
Michael D. Atcheson, Trustee, with the intent that Plaintiff rely on
such representation in allowing Defendant, Michael D. Atcheson,
Trustee, to purchase Larry Haas‟ interest in Simon Square
Development, LLC, and
Third, the representation was false, and
Fourth, Defendant, Michael D. Atcheson, Trustee, knew it
was false, and
Fifth, the representation was material to Plaintiff‟s
agreement to allow Defendant, Michael D. Atcheson, Trustee, to
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purchase Larry Haas‟ interest in Simon Square Development, LLC,
and
Sixth, Plaintiff relied on the representation in allowing
Defendant, Michael D. Atcheson, Trustee, to purchase Larry Haas‟
interest in Simon Square Development, LLC, and
Seventh, as a direct result of such representation, Plaintiff
sustained damage.
In order to establish fraudulent misrepresentation, Mr. Hammett would
need to prove the following:
(1) a false, material representation; (2) [Mr. Atcheson]‟s knowledge
of the falsity or his ignorance of the truth; (3) [Mr. Atcheson]‟s
intent that [Mr. Hammett] act upon the representation in a manner
reasonably contemplated; (4) [Mr. Hammett]‟s ignorance of the
falsity of the representation; (5) [Mr. Hammett]‟s reliance on the
truth of the representation; (6) [Mr. Hammett]‟s right to rely
thereon; and (7) [Mr. Hammett]‟s consequent and proximately
caused injury.
See Kempton v. Dugan, 224 S.W.3d 83, 87 (Mo. App. W.D. 2007). “The party
alleging the fraud bears the burden of proving each element and must statisfy
that burden with clear and convincing evidence.” Id. at 87. A claim of fraud
“requires proof that the speaker knew the misrepresentation was false at the
time it was made.” Id. at 88. Finally, “[d]irect evidence of fraud rarely exists,
but fraud, like any other fact, may be established by circumstantial evidence.”
Peel, 408 S.W.3d at 210 (internal quotation marks and citation omitted). The
jury could freely “believe or disbelieve [such] evidence.” Id.
Here, Mr. Hammett testified that Mr. Atcheson advised him that Mr. Haas
would need to be added to the Simon Square partnership for access to
10
additional capital, but Mr. Atcheson failed to advise Mr. Hammett that the
terms of the ROA would differ from the original Operating Agreement, nor did
he provide Mr. Hammett an advance copy of the ROA so that he could review it
before meeting to sign it. As Mr. Atcheson‟s partner, Mr. Hammett was
justified in relying on Mr. Atcheson‟s statements, and did so to his detriment.
Accordingly, Mr. Hammett has established the elements of fraud, and the trial
court did not err in submitting the 2006 and 2008 fraud claims to the jury.
Point two is denied.
We address points three and four together because they contain related
arguments. In the third point, the Atcheson Parties argue that the trial court
erred in denying the motions for a directed verdict and JNOV because the trial
court submitted to the jury Mr. Hammett‟s claim for breach of the ROA, and
such a claim for breach “is barred by the agreement [Mr.] Hammett seeks to
enforce[,] and [Mr.] Hammett cannot claim the restructure is invalid and then
sue for benefit of the bargain.” In the fourth point, the Atcheson Parties argue
that the trial court erred in denying the motions for a directed verdict and
JNOV because, when the court submitted to the jury Mr. Hammett‟s claims of
breach of the Buy-Sell Agreement, breach of the ROA, breach of fiduciary
duty, and fraud, it wrongfully did so because Mr. Hammett “failed to establish
the causal link between any of the alleged acts of the Atcheson Parties and the
claimed damages and failed to present substantial competent evidence of
damages.” The Atcheson Parties argue that the ROA was binding on the
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Atcheson Trust, but not on Mr. Atcheson as an individual, because Mr.
Atcheson was not a signatory. They assert that “[n]o reasonable juror could
find that Atcheson Individually either signed the Restated Operating Agreement
as Manager or that Atcheson Individually was a party to the Restated Operating
Agreement.”
Limited liability companies are ordinarily considered separate legal
entities that are distinct from their members or owners. Hibbs v. Berger, 430
S.W.3d 296, 306 (Mo. App. E.D. 2014) (internal citation omitted). Members
are generally not liable for the entity‟s debts. Id. However, “this protection
(also known as „limited liability‟) . . . that members of an LLC possess is not
absolute.” Id. “Where a corporation [or an LLC] is used for an improper
purpose and to perpetuate injustice by which it avoids its legal obligations,
equity will step in, pierce the corporate veil and grant appropriate relief.” Id.
(citing Irwin v. Bertelsmeyer, 730 S.W.2d 302, 304 (Mo. App. E.D. 1987)). For
a court to disregard the business entity or pierce the corporate veil, a Plaintiff
must demonstrate the following three-pronged test:
(1) Control, not mere majority or complete stock control, but
complete domination, not only of finances, but of policy and
business practice in respect to the transaction attacked so that the
corporate entity as to this transaction had at the time no separate
mind, will or existence of its own; and
(2) Such control must have been used by the defendant to commit
fraud or wrong, to perpetrate the violation of a statutory or other
positive legal duty, or dishonest and unjust act in contravention of
plaintiff's legal rights; and
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(3) The aforesaid control and breach of duty must proximately
cause the injury or unjust loss complained of.
Id. (internal quotation marks and citation omitted) (emphasis added). To
determine the existence of a fiduciary relationship, “the ultimate question is
whether or not trust is reposed with respect to [the] property or business affairs
of the other.” Id. at 313. (internal quotation marks and citation omitted).
Here, although Mr. Atcheson did not sign the ROA as an individual, he
represented the Atcheson Trust‟s membership in Simon Square as a trustee and
as Simon Square‟s First Manager. In the latter capacity, he was given sole and
absolute control of business practices, such that his actions were inseparable
from those that were attributable to Simon Square or the Atcheson Trust.
Evidence was presented at trial to establish that Mr. Atcheson used this
complete control to commit fraudulent and wrongful acts, including: paying
himself a developer fee of $500,000 against Mr. Hammett‟s objection; using his
own construction, landscaping, and realty companies for company business and
paying them in excess of fair market value for services rendered; paying Mr.
Atcheson‟s personal legal fees; and making political campaign contributions.
This improper use of company resources resulted in an unjust loss to Mr.
Hammett, thereby supporting a finding that Mr. Atcheson breached the
agreement and his fiduciary duties to Simon Square and Mr. Hammett as a
member of the LLC. Therefore, points three and four are denied.
13
In the fifth point, the Atcheson Parties raise several subpoints to support
their argument that the trial court erred in failing to grant a new trial. They
first argue that they are “entitled” to a new trial because of the trial court‟s
alleged “plain error” in failing to require the jury “to find that [Mr.] Hammett
reasonably relied on the alleged fraudulent representations.” (Emphasis
added). They contend that the trial court “submitted multiple theories of
liability to the jury under one verdict form such that the defect in even one of
the theories . . . requires a new trial on all matters.” Second, they argue that a
new trial is warranted “because the verdict fails to apportion damages among
[Mr.] Hammett‟s claims.” Third, they contend that the trial court‟s “instruction
for the breach of the Buy-Sell Agreement was erroneous because the evidence
at trial showed the parties had a dispute over [its] terms.” They assert that Mr.
Hammett “failed to establish that any alleged fraud or breach actually caused
the damages claimed . . . and the jury was thereby given a roving commiss ion
to find damages that were not causally related to the claimed fraud or breach.”
Further, they argue that “the verdict director for breach of fiduciary duty
imposed additional duties not recognized by Missouri law.” Finally, they argue
that the resulting damages are “against the weight of the evidence on each of
[Mr.] Hammett‟s claims.”
“Plain error review is a two-step analysis.” State v. Scott, 278 S.W.3d
208, 212 (Mo. App. W.D. 2009) (internal quotation marks and citation omitted).
14
We first “determine whether or not the error is plain, and second, we determine
whether or not manifest injustice or miscarriage of justice would result if the
error is left uncorrected.” Id. Plain error is defined as “that which is evident,
obvious, and affects substantial rights of the defendant.” Id. (internal
quotation marks and citation omitted). “Instructional error rarely rises to the
level of plain error.” Id. To prove the existence of plain error within an
instructional error context, “[the Atcheson Parties] must show more than mere
prejudice and must show that the [trial] court has so misdirected or failed to
instruct the jury that it is apparent to the appellate court that the instructional
error affected the jury‟s verdict and caused manifest injustice or miscarriage of
justice.” See id. (internal quotation marks and citation omitted).
Jury instructions are governed by Rule 70.02. Peel, 408 S.W.3d at 200.
Non-MAI instructions “must be simple, brief, and free from argument.” Id.
(quoting Rule 70.02). “An instruction results in a roving commission when it
assumes a disputed fact or posits an abstract legal question that allows the jury
to roam freely through the evidence and choose any facts that suited its fancy
or its perception of logic to impose liability.” Scott, 278 S.W.3d at 214
(internal quotation marks and citation omitted).
Here, jury instructions 11 and 12 each include the word, “relied,” in part
six, but the term is not preceded by the adjective, “reasonable.” In reviewing
instructional errors in which an essential element was allegedly omitted, the
absence of a particular word does not automatically imply or signal the
15
existence of prejudicial error. See Peel, 408 S.W.3d at 200. The meaning of
the word, “relied,” is suffiently clear without “reasonable” preceding it. As
business partners, it was reasonable for Mr. Hammett and the Atcheson Parties
to rely on the validity of statements made about their shared business interests.
In a sense, adding “reasonable” to these instructions would have been
superfluous. Thus, the Atcheson Parties‟ argument “is more semantics than
substance.” Id. (internal quotation marks and citation omitted). Furthermore,
nothing in either instruction invited the jury to roam freely in sea rch of the
Atcheson Parties‟ culpability, nor did these instructions improperly impose
fiduciary duties that extend beyond the scope of Missouri law. Mr. Hammett
established the existence of fraud with substantial evidence, and the jury was
“free to believe or disbelieve” the evidence presented. Peel, 408 S.W.3d at
210.
As for the Atcheson Parties‟ challenge to the appropriateness of the
resulting award, “[a] simple claim that the jury‟s verdict was excessive does not
entitle a movant to a new trial.” Mansfield v. Horner, No. WD 76310, 2014
WL 2724854, at *8 (Mo. App. W.D. June 17, 2014) (internal citation omitted).
A defendant “must demonstrate that the verdict was the product of bias and
prejudice” to warrant a new trial on this basis. Id. To meet this burden, a
defendant must establish that “the verdict was glaringly unwarranted by the
evidence and that some trial error or misconduct by the prevailing party was
responsible for prejudicing the jury against the defendant.” Id. (internal
16
quotation marks and citation omitted). Jury verdicts are considered excessive
when the award “exceeds fair and reasonable compensation for [the] plaintiff‟s
damages.” Id. (internal quotation marks and citation omitted). Nothing in the
facts indicates that the jury‟s verdict was “glaringly unwarranted,” nor does it
appear to be excessive or the product of bias.
With respect to apportionment, the Atcheson Parties claim that a new
trial is warranted because one of the theories submitted to the jury—that notice
of the intra-member unit transfer was required of the Atcheson Trust—was
defective. The Atcheson Parties claim that, without apportionment, there is no
way to determine what portion should be attributed to the defective claim,
thereby necessitating a new trial.
Trial courts are not compelled to apportion damages in all circumstances.
Damages and their apportionment are issues for a jury to determine. See Mo.
Pub. Entity Risk Mgmt. Fund v. Am. Cas. Co. of Reading, 399 S.W.3d 68, 81
(Mo. App. W.D. 2013). However, in instances where an unapportioned award
stems from multiple theories submitted to the jury, with one theory later found
to have been defective, we cannot speculate as to how damages should be
divided among the remaining valid claims, nor can we presume that a general
damage award applies to each claim. “Just because a jury returns a verdict for
the plaintiff does not mean it gave the plaintiff all of the types of damages he
or she requested.” Mickey v. BNSF Ry. Co., No. SC 93591, 2014 WL 3107443,
at *9 (Mo. banc 2014) (emphasis added). For this reason, the granting of a new
17
trial is warranted. Accordingly, we grant point five, but only with respect to a
determination of damages.
Finally, in the sixth point, the Atcheson Parties argue that the trial court
erred in failing to amend the judgment “to reflect an offset for monies paid to
[Mr.] Hammett by settling defendants.” They contend that, in denying the
motion, the trial court “acted arbitrarily and unreasonably” because it permitt ed
them to amend their defense of offset to include an offset for settlement
payments that Mr. Hammett received before the trial began, yet the court
“failed to hold an evidentiary hearing to determine the amount of the settlement
payments and credit the judgment” accordingly. They further claim that the
trial court‟s failure to credit these settlement payments resulted in a “windfall”
to Mr. Hammett.
A party may be made whole by one compensatory damage award for
multiple theories of liability, but a double recovery for the same wrongs is
deemed an impermissible windfall. R.J.S. Sec., Inc. v. Command Sec. Servs.,
Inc., 101 S.W.3d 1, 17 (Mo. App. W.D. 2003). “To prove a double recovery, a
defendant must prove an overlap between: (1) the injuries or damages for
which a plaintiff has received compensation; and (2) the injuries or damages
that are the subject of a plaintiff‟s claim against the defendant.” Moore
Automotive Group, Inc. v. Lewis, 362 S.W.3d 462, 468 (Mo. App. E.D. 2012).
Because we have granted point five, requiring a new trial on the issue of
damages only, and because the subject matter of this point on appeal is
18
inextricably interwoven with the issue of damages, point six is denied without
prejudice to the Atcheson Parties‟ ability to attempt to establish a right to offset
on remand.
Mr. Hammett’s Appeal
Mr. Hammett raises one point. He argues that the trial court erred in
failing to amend the judgment to include attorney fees and costs, in that there
was “no rational basis” for failing to grant the motion because the Buy -Sell
Agreement allowed for recovery of reasonable attorney fees and court costs by
the prevailing party of any action instituted to enforce any rights under the
agreement.
Missouri courts generally follow “the American Rule that each party
bears the burden of their own attorney‟s fees.” Wally & Co., L.C. v. Briarcliff
Dev. Co., 371 S.W.3d 880, 885 n.4 (Mo. App. W.D. 2012) (internal citation
omitted). One exception is where a statute specifically authorizes the awarding
of attorney fees to the prevailing party. Id. Another is where there is a
contractual agreement. Mayor, Councilmen, and Citizens of City of Liberty v.
Beard, 636 S.W.2d 330, 331 (Mo. banc 1982) (internal citations omitted).
“Recovery of attorney fees pursuant to a contractual provision is only available
to the prevailing party.” Rental Co., LLC v. Carter Group, Inc., 399 S.W.3d 63,
67 (Mo. App. W.D. 2013). “The prevailing party is the party that obtains a
judgment from the court, regardless of the amount of damages.” Id. (internal
quotation marks and citation omitted). Only “some relief from the court” is
19
required to be considered the prevailing party. Id. (internal quotation marks
and citation omitted).
Because we have granted the Atcheson Parties relief that requires this
matter to be remanded for a new trial on the issue of damages only, Mr.
Hammett‟s appeal is denied without prejudice to his ability to attempt to
establish a right to the recovery of attorney fees on remand.
Conclusion
For the above reasons, the judgment insofar as it determines liability is
affirmed on all claims, except the breach of the Buy-Sell Agreement claim,
which is reversed. We reverse the jury‟s general damages award, and remand
the case for a new trial solely on the issue of damages as to those claims for
which liability has been affirmed. The parties and the trial court are free on
remand to revisit the issues of offset and attorney fees.
/s/ THOMAS H. NEWTON ___
Thomas H. Newton, Judge
Witt, P.J., and Ellis, J. concur.
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