Thomas Dennis and Sonya Cherry v. Riezman Berger, P.C. and Mercy Hospital Jefferson

In the Missouri Court of Appeals
Eastern District
DIVISION THREE
THOMAS DENNIS and SONYA CHERRY,) No. ED103904
)
Appellants, ) Appeal from the Circuit Court
) of St. Louis County
vs. )
) Hon. Robert S. Cohen
RIEZMAN BERGER, P.C. and MERCY )
HOSPITAL JEFFERSON, )
) Filed:
Respondents. ) September 20, 2016
Thomas Dennis and Sonya Cherry (“Appellants”) each sued Riezman Berger, P.C.
(“Riezman”) and Mercy Hospital Jefferson (“Mercy”) alleging violations of the Fair Debt
Collection Practices Act (“FDCPA”) and the Missouri Merchandising Practices Act
(“MMPA”). Cherry made an additional claim against Riezman and Mercy for wrongful
garnishment. The cases were consolidated, and Riezman and Mercy both moved to dismiss
Appellants’ petitions. The motions were heard, and the trial court entered judgment
dismissing both petitions with prejudice at Appellants’ cost. Appellants now appeal from
that judgment. We reverse and remand.
In their petitions, Thomas Dennis and Sonya Cherry both alleged the following:
Mercy, by and through its collection attorneys, Riezman, filed collection suits against them
alleging that they owed outstanding balances for unpaid medical services. In Dennis’s
petition, he alleged that he and Mercy agreed to enter into a consent judgment whereby
Dennis agreed to incrementally pay Mercy the balance owed. Riezman mailed Dennis the
proposed consent judgment, which he signed and returned. Riezman then had the judgment
entered. The judgment did not provide for recovery of post-judgment interest. In Cherry’s
petition, she alleged that Mercy and Riezman took a default judgment against her at their
first opportunity, and it did not provide for the recovery of post-judgment interest.
In both petitions, Dennis and Cherry further alleged post-judgment interest is only
recoverable if it is expressly awarded in the judgment. They further alleged that the thirty-
day deadline to file a motion to modify the judgments and request the court to award post-
judgment interest had expired, that Mercy had not filed post-judgment motions requesting
that post-judgment interest accrue on the judgments, and that as of the date of the petitions,
no party had ever made a request for post-judgment interest to accrue on the judgments. In
Dennis’s case, he alleged the following: over the several months following the entry of the
consent judgment, he made several payments to Mercy, in care of its collection attorneys,
Riezman. Thereafter, Riezman filed an Execution/Garnishment/Sequestration application
directed to Dennis’s bank. Within their garnishment, Mercy and Riezman claimed that the
amount Dennis owed included post-judgment interest and did not properly credit Dennis
for the payment he had made. The entire amount of the garnishment was applied to
Dennis’s bank account, which was insufficient to cover it. His bank assessed a fee for his
failure to maintain funds in his account. Had Mercy and Reizman only issued a
garnishment for the amount Dennis claims he actually owed, Dennis would have had
enough funds in his account to cover the garnishment and would not have been assessed
the bank fee. Cherry alleged that in her case, three garnishments were issued which sought,
inter alia, post-judgment interest.
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Dennis further alleged that Mercy and Riezman attempted to excuse their unlawful
seizure of funds and unilaterally sent him a check, which constituted an admission of
liability that they had unlawfully garnished Dennis over the amount he owed on the
judgment but did not provide full restitution for the amount of the illicit garnishment. He
further alleged the check did not compensate him for the bank fee, the stress and anxiety
of having his bank account depleted to a zero balance or the three-month dispossession and
lack of use of his funds.
Dennis and Cherry both claimed Riezman’s actions violated the FDCPA. Dennis
alleged Riezman violated the FDCPA by: (1) falsely representing the character, amount,
and legal status of the debt; (2) threatening to take action that cannot legally be taken; and
(3) collecting an amount that is not permitted by law. Cherry claimed that Riezman
violated the FDCA by: (1) collecting an amount not authorized by law or agreement
between Cherry and Mercy and Riezman; (2) falsely representing the amount of the debt;
and (3) taking Cherry’s money by making misrepresentations about the amount and content
of the judgment. Both Dennis and Cherry sought judgment that Riezman’s conduct
violated the FDCPA as well as actual damages, statutory damages, costs and reasonable
attorney’s fees and further relief the court deemed proper.
Dennis and Cherry also claimed that Mercy and Riezman’s actions violated the
MMPA. They both alleged that Mercy and Riezman used “deception, false pretenses, false
promises, misrepresentation, factual omissions and unfair business practices when they
garnished funds” from them, which they did not owe and which were not awarded by the
underlying judgments. They alleged Mercy and Riezman drafted the judgments, which did
not provide for post-judgment interest, and had access to them at all times relevant to their
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collection activity and knew they did not award post-judgment interest. Both Dennis and
Cherry alleged that Mercy and Riezman’s actions caused them ascertainable loss, and they
prayed for actual damages, punitive damages, reasonable attorney’s fees, and further relief
the court deemed proper.
Cherry’s petition also included a wrongful garnishment claim as to Mercy and
Riezman, alleging they abused and/or misused garnishment rules and intentionally caused
a garnishment to take funds they knew she did not owe, namely illicit post-judgment
interest. Cherry sought actual and punitive damages as well as any further relief the court
deemed proper.
Riezman filed motions to dismiss in both cases arguing that Appellants’ petitions
were premised on the same allegations, i.e., that the underlying judgments entered against
Appellants for nontort debt did not specifically provide for the collection of post-judgment
interest on the judgment and that the subsequent collection of such interest violated the
FDCPA and MMPA, and in the case of Cherry, established a wrongful garnishment claim.
Riezman claimed that Missouri law does not require a judgment to expressly allow for the
collection of post-judgment interest in order for it to be collected from the judgment debtor
and that, therefore, Appellants failed to state a cause of action upon which relief could be
granted. Mercy filed a one sentence motion to dismiss in both cases praying that the
petitions be dismissed for failure to state a cause of action upon which relief can be granted
without citing any more specific grounds for the motions.1 Thereafter, the cases were
consolidated, and the motions to dismiss were heard and granted. The cases were
1
Both of Mercy’s motions simply stated the following: “COMES NOW Defendant, Mercy Hospital, and
does hereby pray that the Petition filed herein be dismissed for failure to state a cause of action upon which
relief can be granted.”
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dismissed with prejudice at plaintiff’s cost. The trial court’s order of judgment does not
indicate any specific basis for the dismissal. This appeal follows.
We review a trial court’s grant of a motion to dismiss de novo. In re Estate of
Austin, 389 S.W.3d 168, 171 (Mo. banc 2013). “A motion to dismiss for failure to state a
cause of action is solely a test of the adequacy of the plaintiff’s petition.” State ex rel.
Henley v. Bickel, 285 S.W.3d 327, 329 (Mo. banc 2009) (internal quotations omitted). The
plaintiff’s averments are assumed to be true, and all reasonable inferences therefrom are
liberally granted in the plaintiff’s favor. Id. “[T]he petition is reviewed in an almost
academic manner, to determine if the facts alleged meet the elements of a recognized cause
of action, or of a cause that might be adopted in that case.” Id. In order to survive the
motion, “the petition must invoke substantive principles of law entitling plaintiff to relief
and . . . ultimate facts informing the defendant of that which plaintiff will attempt to
establish at trial.” Id. (internal quotation omitted). In making our determination, we do
not address the merits of the case or consider evidence outside the pleadings. Brennan By
and Through Brennan v. Curators of the Univ. of Mo., 942 S.W.2d 432, 434 (Mo. App.
W.D. 1997).
Where, as here, the trial court did not state a basis for its dismissal, “we presume
that dismissal was based on the grounds stated in the motions to dismiss and will affirm if
dismissal was appropriate on any ground supported by the motions.” Duvall v. Lawrence,
86 S.W.3d 74, 78 (Mo. App. E.D. 2002). “If the motion to dismiss cannot be sustained on
any ground alleged in the motion, the trial court’s ruling will be reversed.” Austin, 389
S.W.3d at 171. However, we will not affirm “the grant of a motion to dismiss on grounds
that are not stated in the motion.” Breeden v. Hueser, 273 S.W.3d 1, 6 (Mo. App. W.D.
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2008). Here, the only grounds effectively stated in Mercy and Riezman’s motions to
dismiss were that Appellants fail to state a cause of action upon which relief can be granted
since their petitions are premised on the allegation that the underlying judgments did not
specifically provide for the collection of post-judgment interest. Riezman argued in its
motion to dismiss that Missouri law does not require a judgment to expressly allow for the
collection of post-judgment interest in order for it to be collected from the judgment debtor.
While Mercy filed a one-sentence motion making the very basic allegation that Appellants
failed to state a cause of action upon which relief can be granted, it did not provide any
specific grounds for the motion which this Court can review, much less affirm. Moreover,
the parties conceded that the only issue before the trial court was whether the petitions
should be dismissed based upon the argument that the underlying judgments were not
required to expressly provide for the collection of post-judgment interest. Accordingly,
this is the only issue we will address. 2 Because we find that post-judgment interest is not
an automatic award and must be included in the judgment, we find that the petitions were
improperly dismissed, and we reverse and remand.
2
For the first time on appeal, Riezman, in its response brief, raises additional grounds for dismissal. Riezman
tries to use language from a footnote in Dotson v. Dillard’s, 472 S.W.3d 599, 603 (Mo. App. W.D. 2015), to
argue that a respondent may raise new arguments not heard at the trial court because the appellate court can
affirm a trial court’s judgment on any grounds as long as it reached a correct result. Not only did Dotson
involve a motion to compel arbitration rather than motions to dismiss, which are at issue in this case, but the
court in Dotson also specifically noted the unique procedural posture of the case given that the argument that
was raised for the first time on appeal involved a threshold matter the trial court was to address. Id.
Moreover, the authority the Dotson court cites involved an appeal from a court-tried case, with an entirely
different standard of review than the present case. See Sparks v. Sparks, 417 S.W.3d 269, 278 (Mo. App.
W.D. 2013). The applicable law is as we have previously stated, and we will not affirm “the grant of a motion
to dismiss on grounds that are not stated in the motion.” Breeden v. Hueser, 273 S.W.3d 1, 6 (Mo. App.
W.D. 2008). Accordingly, we will not review the additional grounds for dismissal Riezman argued for the
first time on appeal.
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Mercy and Riezman argue that Section 408.040.2 does not require a judgment to
expressly allow for collection of post-judgment interest in order for it to be collected from
a judgment. We disagree. Specifically, the relevant subsections of Section 408.040 state:
2. In all nontort actions, interest shall be allowed on all money due
upon any judgment or order of any court from the date judgment is
entered by the trial court until satisfaction be made by payment,
accord or sale of property; all such judgments and orders for money
upon contracts bearing more than nine percent interest shall bear the
same interest borne by such contracts, and all other judgments and
orders for money shall bear nine percent per annum until satisfaction
made as aforesaid.
3. Notwithstanding the provisions of subsection 2 of this section, in
tort actions, interest shall be allowed on all money due upon any
judgment or order of any court from the date judgment is entered by
the trial court until full satisfaction. All such judgments and orders
for money shall bear a per annum interest rate equal to the intended
Federal Funds Rate, as established by the Federal Reserve Board,
plus five percent, until full satisfaction is made. The judgment shall
state the applicable interest rate, which shall not vary once entered.
...
Sections 408.040.2, 408.040.3. While the statute distinguishes between nontort and tort
actions, in both situations it provides that “interest shall be allowed on all money due upon
judgment or order from the date judgment is entered by the trial court” until satisfaction.
Sections 408.040.2, 408.040.3 (emphasis added). “The primary rule of statutory
interpretation is to effectuate legislative intent through reference to the plain and ordinary
meaning of the statutory language.” Bateman v. Rinehart, 391 S.W.3d 441, 446 (Mo. banc
2013). We must presume that every word of the statute has an effect and that “the
legislature did not insert superfluous language.” Id. “When the words are clear, there is
nothing to construe beyond applying the plain meaning of the law.” Id. (internal citations
omitted). We will only look beyond the plain meaning of the statute “when the language
is ambiguous or would lead to an absurd or illogical result.” Id. Here, the plain language
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of the statute, “shall be allowed” found in the subsections applicable to judgments in both
nontort and tort actions indicates that the collection of post-judgment interest is not
automatic on every judgment. Sections 408.040.2, 408.040.3. Instead, the plain meaning
of the word “allowed” indicates that post-judgment interest must be permitted by the trial
court. While the use of the word “shall” indicates a lack of discretion, we interpret the
phrase “shall be allowed” to indicate that the trial court has a mandatory duty to grant post-
judgment interest where sought, not that such interest is automatic on every judgment.
The language of next phrase of each subsection of the statute, which sets out the
specific rate of interest to be applied, begins “all such judgments.” Sections 408.040.2,
408.040.3. Again, this does not refer to all judgments since the post-interest judgment is
automatic, but instead refers to all judgments that have been “allowed” per the preceding
clause. While Section 408.040.3 states the additional requirement that judgments in tort
actions state the applicable interest rate according to the prescribed formula, this additional
requirement does not mean that post-judgment interest is automatically awarded in nontort
cases. Instead, post-judgment interest must be included in the judgment, whether on a
nontort or tort action, with the additional requirement that the applicable interest rate be
stated in a tort action judgment.
We find the argument that the an award of post-judgment interest is automatic on a
tort judgment inconsistent with the decision of the Missouri Supreme Court in McGuire v.
Kenoma and find the Court’s reasoning in that case applicable to both nontort and tort
judgments, especially given that similarity in the language of the subsections of the statute
as described above. 447 S.W.3d 659, 665-67 (Mo. banc 2014). In McGuire, the Missouri
Supreme Court held that the use of a nunc pro tunc judgment was improper to retroactively
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include post-judgment interest under Section 408.040 absent evidence the trial court
intended to include post-judgment interest in its original judgment. Id. at 667. Twelve
plaintiffs filed suit against defendant claiming its hog operations created a temporary
nuisance. Id. at 661. Following a jury trial on their tort claims, judgment was entered
awarding plaintiffs damages, but the judgment did not award post-judgment interest or
identify an applicable interest rate. Id. There was no post-trial motion requesting inclusion
of post-judgment interest, no motion to amend the judgment, and no appeal claiming error
in the judgment. Id. at 662. After the case was appealed on other issues and a mandate
issued, plaintiffs filed a motion in the trial court requesting the court award post-judgment
interest, set the interest rate and affix their costs. Id. Plaintiffs requested the amendment
nunc pro tunc of the final judgment so they could collect interest retroactive to the date
judgment was entered on the verdict. Id. The trial court granted plaintiffs’ motion, and
defendant appealed. Id.
Plaintiffs argued that the omission of post-judgment interest was a clerical error
that did not change the substance of the judgment because the interest was “automatic
insofar it does not require any party to make a request and is mandatory, outside the realm
of judicial discretion.” Id. at 665 (internal citations omitted). However, the Court noted
that nunc pro tunc judgments could not “be used to correct a failure to include mandatory
statutory language that should have been included in the original judgment but was omitted
in error. To do otherwise would allow changes that would change a party’s substantive
rights. . . .” Id. at 667. The Court held that because there was no evidence to suggest the
trial court intended to include post-judgment interest in the original judgment, the trial
court erred in issuing the nunc pro tunc judgment to include post-judgment interest. Id. In
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so holding, the Missouri Supreme Court found that “the retroactive inclusion of the post-
judgment interest substantively changed the judgment.” Id.
Appellate court cases interpreting McGuire further support our opinion in this case.
In Peterson v. Discover Prop. and Cas. Ins. Co., the Western District noted that,
After McGuire . . . it is evident that an interest award
pursuant to Section 408.040 must be made in the original
judgment, pursuant to a timely amendment following a Rule
78.07 motion, pursuant to Rule 75.01, or even pursuant to a
nunc pro tunc where there is evidence in the record that the
trial court intended to include an interest rate or order
payment of interest at the time the judgment was entered.
460 S.W.3d 393, 413 (Mo. App. W.D. 2015). Because an amendment to the judgment in
Peterson was not sought and error was not timely asserted, the court found it was improper
for the trial court to amend the judgment to reflect interest when it was not awarded in the
original judgment. Id. In SKMDV Holdings, Inc. v. Green Jacobson, P.C., citing McGuire
and Peterson, this Court recently held that where the appellant did not make a specific
request for post-judgment interest and the asserted error regarding post-judgment interest
was not raised in the parties’ post-trial motions filed with the court, the trial court was not
authorized to award post-judgment interest after the initial thirty-day period ended from
the date of the original judgment. Id. at *17-18. 2016 WL 1469995 (Mo. App. E.D. 2016)
(application for transfer denied by the Missouri Supreme Court on August 23, 2016).
While McGuire arises in the context of a nunc pro tunc judgment in a tort case, we
find that the reasoning behind the decision and its progeny applies in this case. 3 Like the
Missouri Supreme Court in McGuire, we reject the argument that post-judgment interest is
3
Riezman also relies upon two cases in which the appellate courts held that it was unnecessary to specify the
interest in the judgment on the tort actions at issue in those cases, but these cases predate the decision of the
Missouri Supreme Court in McGuire and its progeny. See Adkins v. Hontz, 337 S.W.3d 711, 723 (Mo. App.
W.D. 2011); Robinson v. St. Louis Bd. of Police Comm’rs, 212 S.W.3d 165, 167 (Mo. App. E.D. 2006).
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automatic and find that collection of post-judgment interest on a judgment, regardless of
whether it was on a nontort or tort action, “substantively change[s] the judgment.” See
McGuire, 447 S.W.3d at 667.
In addition, the Missouri Supreme Court in McGuire was not just concerned that
the original judgment did not state the applicable interest rate for the post-judgment
interest, which is a requirement under the subsection of the statute specific to tort actions.
McGuire, 447 S.W.3d at 667. Instead, the Court noted that the judgment did not award
post-judgment interest or state the applicable interest rate. Id. at 661. It expressed concern
that there was no evidence in the record indicating the trial court intended to include post-
judgment interest in the original judgment. Id. at 667. Specifically, the Court stated:
Even if the trial court intended to include the post-judgment
interest in its original judgment, and even if the post-
judgment interest is mandated by statute, an omission of an
award of post-judgment interest cannot be considered a mere
clerical error. . . .
...
Without evidence in the record to indicate that the award of
post-judgment interest was actually made, the omission of
the mandatory statutory language in the judgment is mere
error, correctable by either a motion pursuant to Rule 75.01
or Rule 78.07, but not by nunc pro tunc.
...
Though the trial court should have included the award of
post-judgment interest in its original judgment, it did not;
nor is there any evidence in the record showing the court’s
intention to set the interest rate.
Id. at 667 (emphasis added). Moreover, the Court specifically reversed “the provisions
setting an interest rate and awarding post-judgment interest in the judgment,” not simply
the provision of the judgment setting the interest rate. Id. at 667 (emphasis added).
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Accordingly, we find that the Court’s holding was not intended to be limited to tort actions
based on the additional requirement for tort actions that the applicable interest rate be stated
in the judgment. After all, the Court specifically stated that it was “the retroactive inclusion
of the post-judgment interest” that substantively changed the judgment, not the retroactive
inclusion of the post-judgment interest rate specific to tort actions. See id.
Further, we find no policy reason to suggest the holdings from McGuire and its
progeny should only apply to judgments in tort cases. In fact, we see good reason to apply
McGuire to judgments under Sections 408.040.2 and 408.040.3. Not only are judgments
presumed to be correct, but as a general matter, judgments must be definite and certain to
be enforceable. Kells v. Mo. Mountain Properties, Inc., 247 S.W.3d 79, 81 (Mo. App. S.D.
2008); Foraker v. Foraker, 133 S.W.3d 84, 98 (Mo. App. W.D. 2004). “A valid judgment
fixes the rights and responsibilities of the parties, with the obligor’s duties readily
understood so as to be capable of performance, and with the clerk able to issue, and the
sheriff to levy, execution.” Hall v. Fru-Con Cost. Corp., 101 S.W.3d 318, 319 (Mo. App.
E.D. 2003) (internal citations omitted). Our courts have clearly placed value in judgments
that are definite, and judgments that expressly state an award of post-judgment interest
provide parties with certainty that is not available where a judgment creditor
retrospectively and unilaterally collects post-judgment interest without an express
provision for such interest in the judgment itself. The rights and responsibilities of the
parties and the obligor’s duties can be better understood by the parties and anyone else who
would have reason to later review the judgment where the post-judgment interest is an
express provision of the judgment. Moreover, judicial economy and efficiency is better
12
achieved when we minimize the need for retroactive application of a statute or any related
judicial interpretation.
Mercy and Riezman rely upon several older cases, including Laughlin v. Boatman’s
National Bank of St. Louis, 189 S.W.2d 974, 980 (Mo. 1945), for the proposition that “[t]he
judgment bears interest by reason of the statute and it is not necessary that it or the mandate
recite the fact.” 4 While Riezman used these cases to argue for dismissal, based upon our
interpretation of McGuire, a much more recent Missouri Supreme Court case, we find that
they should no longer be followed to the extent that they suggest that judgments bear
statutory interest automatically or unilaterally by reason of the statute rather than indicating
a court’s mandatory duty to grant post-judgment interest where sought. Instead, we find
the holding in Peterson to apply in both nontort and tort actions. Specifically, we find that
after McGuire it is evident that an interest award pursuant to Section 408.040, regardless
of whether it is made in a nontort or tort action, “must be made in the original judgment,
pursuant to a timely amendment following a Rule 78.07 motion, pursuant to Rule 75.01,
or even pursuant to a nunc pro tunc where there is evidence in the record that the trial court
intended to include an interest rate or order payment of interest at the time the judgment
was entered.” See Peterson, 460 S.W.3d at 413.
4
Among other cases from the nineteenth century, Riezman also cites State ex rel. Walsh v. Vogel, 14 Mo.
App. 187, 189-90 (1883), for the similar proposition that “In order that the judgment shall bear interest, it
was not necessary that the court delivering the judgment should say so and make this statement a part of the
judgment, because the statute expressly provides that every judgment shall bear interest.”
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Because the petitions in this case were dismissed based upon a misinterpretation of
the current state of the law, we find the dismissals of the petitions improper. We reverse
the trial court’s judgment and remand for further proceedings consistent with this opinion.
ROBERT G. DOWD, JR., Judge
Angela T. Quigless, P.J. and
Lisa S. Van Amburg, J., concur.
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