Dent Wizard of San Francisco, Inc. v. Bunetic

172 S.W.3d 481, 2005 Mo. App. LEXIS 1396, 2005 WL 2333680
CourtMissouri Court of Appeals
DecidedSeptember 27, 2005
DocketED 85349
StatusPublished
Cited by4 cases

This text of 172 S.W.3d 481 (Dent Wizard of San Francisco, Inc. v. Bunetic) is published on Counsel Stack Legal Research, covering Missouri Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Dent Wizard of San Francisco, Inc. v. Bunetic, 172 S.W.3d 481, 2005 Mo. App. LEXIS 1396, 2005 WL 2333680 (Mo. Ct. App. 2005).

Opinion

KATHIANNE KNAUP CRANE, Presiding Judge.

Plaintiffs appeal from a judgment awarding defendants’ former attorney attorney’s fees in the amount of $25,516.74 to be paid to the attorney from an injunction bond posted by plaintiffs in their injunction action against defendants. 1 Defendants have not filed a motion to assess *483 damages under the bond. We reverse because defendants’ former attorney was neither a party enjoined nor a party interested in the subject matter of the controversy and therefore had no standing to recover damages under the bond.

On August 4, 2008, plaintiffs, Dent Wizard of San Francisco, Inc. (individually, DSWF), and Dent Wizard International Corporation, filed a petition for injunctive and other relief and damages against defendants, nine former employees of plaintiffs. Plaintiffs alleged that each defendant breached a non-solicitation agreement and interfered with DSWF’s customers. After plaintiffs applied for a temporary restraining order (TRO) against defendants, the trial court entered a TRO and approved a bond in the amount of $125,000. Edward Kruse, respondent in this appeal, entered his appearance as attorney for defendants.

Mr. Kruse subsequently filed a motion to dissolve the TRO on the grounds that the signature of defendant Blake Bunetic had been forged. After a hearing, the trial court dissolved the TRO against Mr. Bunetic, renewed and extended the TRO against the remaining defendants and increased the bond to $300,000. Plaintiffs subsequently dismissed Mr. Bunetic from the action without prejudice. Mr. Kruse next filed a motion to dissolve the TRO with respect to the remaining defendants, which the trial court denied. Mr. Kruse later filed a motion to dissolve the TRO on the grounds that the signature of defendant Justin Cunningham had been forged. Plaintiffs voluntarily released Mr. Cunningham from the TRO.

In March, 2004 defendants discharged Mr. Kruse and engaged the services of attorney Richard Edwards, who entered his appearance on March 1, 2004. On August 16, 2004, Mr. Kruse filed a motion to withdraw.

On September 9, 2004, Mr. Kruse filed an “Amended Motion for Assessment of Attorney Fees on Injunction Bond.” Mr. Kruse alleged that he incurred attorney’s fees in the amount of $58,127.63 while representing defendants, and he sought payment from the bond in the amount of $25,516.64. Specifically, Mr. Kruse stated:

[CJounsel seeks compensation for reasonable attorney fees that were incurred on behalf of defendants in their representation and defense. Counsel spent substantial amounts of time and expense in representing the defendants as a whole and in the procuring of the dissolution of the Temporary Restraining Order as to defendants Bunetic and Cunningham. Defendants’ former attorney thus moves for the payment of outstanding attorney fees for the expense, effort and time expended on defendants’ behalf in the amount of $25,516.64 either from the injunction bond, or, in the alternative, that an attorney lien be placed upon the defendants cause of action and any verdict, proceed or judgment that is a result of this cause of action.

Both defendants and plaintiffs opposed Mr. Kruse’s motion in the trial court.

The trial court subsequently entered a judgment awarding Mr. Kruse $25,516.74. It concluded that Mr. Kruse’s attorney’s fees were compensable damages that could be paid from the bond and Mr. Kruse had an enforceable attorney’s lien on the bond.

DISCUSSION

We will affirm an award of damages on an injunction bond unless there is no substantial evidence to support it, it is against the weight of the evidence, or it erroneously declares or applies the law. Buttress v. Taylor, 62 S.W.3d 672, 678 (Mo.App.2001), citing Murphy v. Carron, 536 S.W.2d 30 (Mo. banc 1976).

*484 In the first of their four points, plaintiffs contend that the trial court erroneously declared and misapplied the law when it entered a judgment awarding attorney’s fees to Mr. Kruse from the injunction bond because Mr. Kruse had no standing to recover his own fees on the bond. We agree and find this point disposes of this appeal.

Sections 526.070, 526.200, and 526.210 RSMo (2000) govern injunction bonds. These statutes limit a court’s jurisdiction to award damages to those damages that may be awarded on the bond. Seaton v. Western Auto Supply Co., 609 S.W.2d 207, 210 (Mo.App.1980) (quoting the City of St. Louis v. St. Louis Gaslight Company, 82 Mo. 349, 357 (1884)). Those statutes “ ‘provide the only basis for an assessment of damages arising from the issuance of an injunction.’ ” Newcourt Financial USA v. Lafayette Inv., 983 S.W.2d 214, 216 (Mo.App.1999) (quoting Collins & Hermann v. St. Louis County, 684 S.W.2d 324, 325-26 (Mo. banc 1985)).

Only the parties enjoined or parties “interested in the subject matter of the controversy” may recover damages on the injunction bond. Section 526.070; Rule 92.02. An “interested party” for the purposes of section 526.070 is any party to the injunction suit, whether enjoined or not “who incurs a loss as the actual, natural, and proximate result of the restraint being issued.” Buttress, 62 S.W.3d at 680. In Buttress, the court held that an intervenor to the injunction suit who had incurred attorney’s fees to protect its interests in the injunction suit was an interested party because it incurred those fees as the “actual, natural and proximate result of the restraint.” Id.

An award of damages on an injunction bond may include an award of reasonable attorney’s fees paid for necessary services rendered to lift the restraint. Collins & Hermann, 684 S.W.2d at 326. This is an award made to the client who incurred the fees, not to the attorney who rendered the services.

As a general matter, an attorney who represents a client in an action is not an interested party to the action. McLaughlin v. McLaughlin, 427 S.W.2d 767, 768-69 (Mo.App.1968). Specifically, Mr. Kruse is not an interested party who may recover damages on the bond under sections 526.070 and 526.200. He is not a party to the suit for injunction or an inter-venor in that action. Mr. Kruse has no personal interest in the subject matter of the TRO or the underlying action. He was not enjoined and has not incurred a loss as the actual, natural and proximate result of the restraint. Rather, his loss, if any, arose from his contractual relationship with defendants and defendants’ alleged failure to pay him the amounts he billed them for legal services he rendered.

Because Mr.

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172 S.W.3d 481, 2005 Mo. App. LEXIS 1396, 2005 WL 2333680, Counsel Stack Legal Research, https://law.counselstack.com/opinion/dent-wizard-of-san-francisco-inc-v-bunetic-moctapp-2005.