Firearm's Security, Inc. v. Armory Facilities, Ltd.

760 S.W.2d 402, 1988 Mo. LEXIS 93, 1988 WL 121358

• Court: Supreme Court of Missouri
• Decided: November 15, 1988
• Docket: Nos. 70349, 70088
• Status: Published

Opinions

WELLIVER, Judge.

This is an appeal from the order of the Cole County Circuit Court entering summary judgment in favor of John A. Pelzer, Commissioner of the Office of Administration (Commissioner) and Sterling Lacquer Manufacturing Company (Sterling) confirming sale of the St. Louis Armory Building to Sterling and against Firearm’s Security, Inc., d/b/a The Bull’s Eye (Firearms), Gateway Indoor Soccer Club, Inc. (Gateway) and St. Louis Hinder Club, Ltd. (Hinder), intervenor, alleged lessees who were declared to have no right of occupancy of the Armory Building. The court also overruled Armory Facilities, Ltd. (Armory Facilities) motion to dismiss and declared the Notice of Lis Pendens to be void, neither of which actions appear to be disputed, and ordered Sterling to pay $250,100, the amount of its high bid, into the registry of the court to be distributed in accordance with the evidence to be adduced as to each party’s proper share. The judgment was declared final for appeal.

Armory Facilities filed a direct appeal to this Court basing jurisdiction upon unconstitutionality of the legislative enactment authorizing the sale, Senate Bill 782, 83rd General Assembly, Second Regular Session, 1986. Firearm’s and Gateway filed appeals to the Court of Appeals, Western District. The Commissioner moved and was granted transfer of those two appeals to this Court prior to opinion. While there is substantial question regarding our jurisdiction of the Armory Facilities appeal, in the interest of judicial economy we retain the cases and decide as on original appeal. Mo. Const, art. V, §§ 2, 10. We affirm the summary judgment of the trial court confirming the sale and declaring the Lis Pen-dens void and remand for resolution of all other issues.

I

THE FACTS

The case involves the sale by the State of the St. Louis Armory Building.

The Armory was built in 1937 by the City of St. Louis. In 1962 it was deeded to the State and was occupied by the National Guard until 1971. Various groups occupied the building from 1971 to 1976. In May of 1976, a not-for-profit corporation was created to occupy and run the Armory, which corporation is today known as Armory Facilities. By the Reorganization Act of 1974, title to real estate such as this was vested in the Governor who could not convey or otherwise transfer title without authorization of the General Assembly.

Armory Facilities has run and occupied the Armory building from 1976 until the present time. There is no evidence of a formal lease having ever been executed by the State to Armory Facilities. It is undisputed that from 1976 to the present Armory Facilities did occupy and run the building either as a licensee or lessee of the state and during such period that other parties to the litigation occupied certain portions of the premises, at some times pursuant to formal leases and at other times pursuant to oral leases. Gateway primarily operated an indoor softball or soccer field, Firearms a firearms store and indoor firing range, and Hinder handball courts. At times these primary operations included associated bar and lounge and other recreational facilities. All, including Armory Facilities, had made improvements necessary to their operations. There was no question that the State was fully aware of the extent and nature of all operations.

In 1986, Senate Bill 782 was enacted providing:

Section 1. 1. The commissioner of administration is hereby authorized to conduct a public sale, by either public auction or sealed bid, of the hereinafter described real property. The governor is hereby authorized to convey title to the property to the highest bidder at the sale by quitclaim deed.

2. The property to be conveyed is located in the city of St. Louis, comprises property formerly known as the St. Louis National Guard Armory, is under the control of the office of administration, and is described as follows:

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3. The commissioner of administration shall set such terms and conditions for the sale as he shall deem reasonable, including but not limited to, the time, date, and place for the sale, shall arrange for appraisals, and shall determine the method of payment.

4. The commissioner of administration is directed to give credit to the lessees for any improvements which have been constructed by the lessees in or on the property described in subsection 2 of this section. In the event that the credit for the improvements is not sufficient to make the lessees the top bidder for the property, the money received from the successful bidder shall be first paid to the lessees in the amount of the lessees’ credit and the remaining money shall be paid to the state of Missouri.

5. The successful bidder shall take the property described in subsection 2 of this section subject to the Red Cross being able to use such property as a disaster center and storage facility for three years after the date of sale. The Red Cross shall be able to use such property for this three-year period without paying any rent, however, the Red Cross shall be responsible for their pro rata share of the utilities, taxes and insurance.

6. No lessee shall be evicted or requested to vacate the property described in subsection 2 until after the closing date of the conveyance described in subsection 1.

7. Notice of the sale along with the terms and conditions shall be given in a newspaper of general circulation within the city of St. Louis.

8. The attorney general shall approve the instrument of conveyance.

Following enactment of S.B. 782, Gateway and Firearms prepared itemized lists of the improvements claimed by each and transmitted them to Armory Facilities. Firearms alleged $137,990.41 of improvements. Gateway alleged $246,700 of improvements. Armory Facilities compiled a list of $326,000 of improvements which consisted of their and Hinder’s improvements. Hinder alleges $150,000 of improvements leaving Armory Facilities with $176,000 of claimed improvements. Armory Facilities combined the three lists of claimed improvements and submitted the entire amount of $710,690.41 to the Commissioner. The Commissioner reviewed the list and advised that he would allow only $212,-500 of the alleged $710,690.41.

The Commissioner then advertised the Armory Building for sale and received bids as follows: The St. Louis Drum and Bugle Corps, $1,500,000; Sterling $250,100, and Armory Facilities $212,510, being the amount allowed by the Commissioner for improvements plus $10. The bid of St. Louis Drum and Bugle Corps was rejected when their deposit check bounced and Sterling was declared the high bidder. The filing of the various suits, cross-suits, and counter-suits followed.

The trial court entered summary judgment for the Commissioner and Sterling confirming the sale and ordering it to be closed and finalized; declared the Lis Pen-dens void; ordered the purchase price of $250,100 paid into the registry of the court; and, reserved all issues pertaining to proper distribution of the proceeds for later determination.

II

If, under the terms of the statute and the undisputed facts reflected in the pleadings and affidavits, the Sterling bid was in fact the high bid, then the summary judgment confirming the sale should be affirmed. Rule 74.04(c) (summary judgment is authorized if there is no genuine issue as to any material fact); Packet Dairy, Inc. v. Ziegler’s Super Market, Inc., 676 S.W.2d 926, 927 (Mo.App.1984) (summary judgment is not precluded if the only facts charged to be in dispute are the differing opinions of the parties as to the legal effect of an ascertained state of facts); Seliga Shoe Stores, Inc., v. City of Maplewood, 558 S.W.2d 328, 331 (Mo.App.1977) (not every factual dispute will bar summary judgment; the dispute must involve a material fact, one which has legal probative force as to a controlling issue).

It is argued that the combined alleged improvements constituted the high bid under the terms of the statute. In this connection, we find not one line of any affidavit or pleading which seeks to submit either the combined or as individual improvements as a bid for the property. If, for the purposes of argument we say that Armory Facilities submitted the combined improvements of all lessees as a bid, then they did so by conceding the correctness of the Commissioner’s valuation of the improvements without objection of any party. This figure was not high enough to constitute the high bid. Neither the improvements alleged by Gateway, Firearms, Hinder or Armory Facilities individually constituted a sum greater than the Sterling bid. The trial court correctly ruled that Sterling's bid was the high bid. It is neither briefed nor argued that the requested preliminary injunctive relief was a bar to entry of the summary judgment. The trial court appropriately ordered summary judgment confirming the sale and declaring void the Lis Pendens.

Ill

Armory Facilities’ appeal to this Court would invoke our jurisdiction on the ground that Section 5 of S.B. 782, giving occupancy rights to the American Red Cross for a period of three years, constitutes special legislation, under Mo. Const, art. Ill, § 40(28). It was argued that Armory Facilities was without standing to raise the issue,¹ and, that if Section 5 did in fact constitute special legislation, that Section 5 was severable from the remainder of the bill. § 1.140, RSMo 1986, declares the standard for severability:

1.140 Severability of statute provisions. — The provisions of every statute are severable. If any provision of a statute is found by a court of competent jurisdiction to be unconstitutional, the remaining provisions of the statute are valid unless the court finds the valid provisions of the statute are so essentially and inseparably connected with, and so dependent upon, the void provision that it cannot be presumed the legislature would have enacted the valid provisions without the void one; or unless the court finds that the valid provisions, standing alone, are incomplete and are incapable of being executed in accordance with the legislative intent.

Section 1.140, RSMo 1986. See also State ex rel. Public Defender Comm’n v. County Court of Greene County, 667 S.W.2d 409, 413-14 (Mo. banc 1984) and Gramex Corp. v. Von Romer, 603 S.W.2d 521, 526 (Mo. banc 1980). If, after eliminating Section 5 “enough remains which is good to clearly show the legislative intent, and to furnish sufficient details of a working plan by which that intention can be made effectual”, State ex rel. Harvey v. Wright, 251 Mo. 325, 337, 158 S.W. 823, 826 (banc 1913), then Section 5 is severable and the remainder of the act remains. There would, in our opinion, be no question about the sever-ability of Section 5, were we required to deal with that issue.

At the hearing on the motion for summary judgment, the trial court was presented with a quit claim deed from the American Red Cross to the State of Missouri, thereby rendering it unnecessary that we decide either the question of facial unconstitutionality; standing to raise such issue; or sev-erability.

IV

On remand, we perceive but one troublesome problem — the question of whether S.B. 782 authorizes the Commissioner to determine the value of the parties alleged improvements.

Section 4 states that “The Commissioner of Administration is directed to give credit to the lessees for any improvements which have been constructed on the property ... ” In the factual background, it appears clear that “lessees” refers to all occupants of the building who are parties herein, be they licensees, lessees or subles-sees. Clearly, nothing in the bill authorizes the Commissioner to “determine the value” of the improvements. On the other hand, we do not believe the legislature intended that the words “[that the Commissioner] give credit to the lessees for any improvements which have been constructed” meant that the Commissioner was bound to credit any figures submitted by lessees. We can only conclude that the legislature intended the reasonable value of the improvements, and that if such could not be agreed on by the parties, of necessity, it would become a matter for determination by an impartial trier of fact. The Commissioner and one of the parties, Armory Facilities, had no authority to bind the other parties by purported agreement that the Commissioner properly valued the improvements. On remand, either the parties shall stipulate or the court shall determine the reasonable value of improvements made by Gateway, Firearms, Armory Facilities and Hinder and shall pro-rate the proceeds as their interests appear, with the remaining money, if any, to be paid to the State pursuant to Section 4 of S.B. 782. Cf. City of St Louis v. Wabash Railroad Co., 421 S.W.2d 302, 306 (Mo. banc 1967).

There being no formal leases or agreements with the State, no party in possession has rights of possession greater than that of a tenant from month to month. All, we believe, have by reason of Section 6 of S.B. 782 and the pendency of these proceedings, had notice to vacate upon determination of the amount of improvements made by the parties and distribution of the proceeds of the sale of the building and final closing of this transaction.

Since all of the acts complained of in the many cross and counter claims for damages were acts done by the parties seeking to comply with the terms and procedures of sale set forth in S.B. 782, it would appear that such claims for damages are without merit. All that remains is valuation of the reasonable value of improvements, possibly set-off of any unpaid rents, and proration of the proceeds of sale. Clearly, Palliser has no standing to enjoin the sale and his petition should be dismissed.

Summary judgment confirming the sale is affirmed; the Lis Pendens held void; and, the cause remanded for distribution of sale proceeds in accordance herewith.

Affirmed in part and remanded with orders.

BILLINGS, C.J., and DONNELLY and HIGGINS, JJ., concur.

BLACKMAR, J., dissents in separate opinion filed.

ROBERTSON and RENDLEN, JJ., dissent and concur in separate dissenting opinion of BLACKMAR, J.

1 . Ryder v. County of St. Charles, 552 S.W.2d 705, 707 (Mo. banc 1977) (only those who are adversely affected by a statute have standing to challenge its constitutionality); St. Louis Public Service Co. v. City of St. Louis, 302 S.W.2d 875, 879-881 (Mo. banc 1957) (one who voluntarily proceeds under a statute to claim benefits thereby conferred, cannot later question its validity in order to avoid its burdens).