Lick Creek Sewer Systems, Inc. v. Bank of Bourbon

747 S.W.2d 317, 1988 Mo. App. LEXIS 506, 1988 WL 22111
CourtMissouri Court of Appeals
DecidedMarch 15, 1988
Docket15204, 15258
StatusPublished
Cited by31 cases

This text of 747 S.W.2d 317 (Lick Creek Sewer Systems, Inc. v. Bank of Bourbon) 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
Lick Creek Sewer Systems, Inc. v. Bank of Bourbon, 747 S.W.2d 317, 1988 Mo. App. LEXIS 506, 1988 WL 22111 (Mo. Ct. App. 1988).

Opinion

HOLSTEIN, Judge.

This is the second of two actions filed by Lick Creek Sewer Systems, Inc., Lawrence Chura, and Anne Chura (plaintiffs) alleging various irregularities and improprieties arising out of a foreclosure sale of plaintiffs’ property, said sale having occurred in January of 1982. Plaintiffs appeal from an order sustaining motions to dismiss filed on behalf of defendants Bank of Bourbon (the Bank), Grover Johnson, and John Woodward. On appeal, the plaintiffs claim the trial court erred in determining that a prior dismissal of similar claims against these defendants was res judicata as to the claims presented here and because the trial court erred in finding that the claims alleged in plaintiffs’ petition failed to state a cause of action against defendants. We reverse.

The first action was commenced on January 29, 1982. The petition in the first action, as amended, consisted of four counts naming the Bank, Woodward, Johnson, the Estate of George Knapp, and seven others as defendants. Count I alleged that plaintiffs had executed two notes secured by two deeds of trust in favor of the Bank, one note for $228,030.25 dated April 3, 1981, and the second for $16,750 dated July 28, 1981; that there had been discussions regarding extensions of credit among plaintiffs, the Bank, and Johnson; that plaintiffs had been lulled into a false feeling of security because of a course of dealing with the Bank and Johnson; and that the Bank and Johnson had given them only ten days opportunity to cure defaults before giving directions to Woodward to proceed with foreclosure. Count I further alleged that Woodward had acted as attorney for the plaintiffs, and he had breached a fiduciary duty toward plaintiffs by acting on behalf of the Bank in the foreclosure. Count I asked for damages against Johnson, the Bank, and Woodward for their alleged wrongful foreclosure. Count II sought to set aside the foreclosure sale and subsequent conveyances after the sale and to enjoin further conveyances. Count III of the petition in the prior action alleged that plaintiffs had rights to the proceeds of the sale at the foreclosure and that Woodward, Johnson, and the Bank had conspired to interfere with plaintiffs’ contractual rights to the proceeds of the sale. Count IV was a claim by Anne Chura for dam *320 ages resulting from an alleged conversion of personal property which she claimed was located on the real estate at the time the Bank and Johnson took possession of the real property.

Following the filing of motions to dismiss by various defendants in the former case, including the Bank, Johnson, and Woodward, the trial court on June 1, 1983, dismissed all four counts with prejudice against the Bank and Woodward. For reasons not apparent on the record, the court did not rule on Grover Johnson’s motion to dismiss. The claims against Johnson were still pending when plaintiffs made an abortive attempt to appeal from the order dismissing the petition as to other defendants. The appeal was dismissed because the trial court had failed to adjudicate all the issues among all the parties. Chura v. Bank of Bourbon, 674 S.W.2d 675, 678 (Mo.App.1984).

Following the dismissal of the appeal, the plaintiffs appeared before the trial court and filed a dismissal of all claims against all defendants in the original action without prejudice. Pursuant to that request, the court made the following minute entry on September 4, 1984:

Counts I, II, III, and IV of petition ... dismissed as per said Dismissal Without Prejudice.

On the date the order was entered, all parties were present, either in person or by attorney, and joined plaintiffs’ attorney in signing a memorandum titled “Dismissal Without Prejudice” which purported to dispose of all claims and counterclaims. The record gives no indication that any of the parties objected to the court’s minute entry.

The present case began with the filing of plaintiffs' seven-count petition on January 23,1987, naming the Bank, Johnson, Woodward, and the Estate of George Knapp as defendants. 1

Count I of plaintiffs’ petition alleges that Lick Creek had executed two notes secured by two deeds of trust in favor of the Bank, as described in the former petition; that the Churas had guaranteed payment of the notes; that Woodward, as trustee for the Bank and under the Bank’s direction, had foreclosed on the deed of trust secured by the lesser of the two notes and that Woodward had received $200,000 at the foreclosure sale; that the lesser note should have been satisfied; and that Woodward should pay the balance of $183,250 over to plaintiffs. Count II alleges that Johnson and the Bank had knowledge of Woodward’s fiduciary and contractual obligations under the deed of trust and induced Woodward to violate those obligations maliciously and without justification; and that Johnson, the Bank, and Woodward had conspired together to interfere with the plaintiffs’ contractual rights to be paid the excess over $16,750 received at the foreclosure sale. Count V alleges that the Bank, through its officer Johnson, “wrongfully foreclosed” on the July 28, 1981, deed of trust by giving plaintiffs “a false sense of security about their obligations, and misrepresented the amount due at the time of foreclosure....” The manner in which this allegedly occurred was that the Bank had failed to require prompt and timely payment over several years of dealing with plaintiffs; that in the fall of 1981 the Bank approved a “refinancing arrangement” and represented it would not foreclose but would continue the “financing arrangement” pending the completion of a “refinancing package”; and that on November 20,1981, the Bank requested that plaintiffs renew the “financing arrangement” by December 4, 1981, which plaintiffs made “arrangements” to do. However, after December 4, 1981, the Bank failed to meet with the plaintiffs and dispel their belief “in the security of their position with the ... Bank.” The Bank thereafter is alleged to have foreclosed without giving a “proper and adequate demand” for payment by demanding $244,780.25 while it only foreclosed on a $16,750 debt. In Count VI, Anne Chura makes a claim for damages resulting *321 from conversion by the Bank and Johnson of certain personal property which she claims was located on the real estate at the time of the foreclosure.

Motions to dismiss were filed by Woodward, the Bank, and Johnson. These motions claim that the June 1, 1983, order of dismissal with prejudice operates as a bar to this action under the doctrines of res judicata, collateral estoppel, and splitting causes of action and that the petition fails to state any claim upon which the relief sought can be granted. The trial court sustained the motions as to all three defendants. Plaintiffs appeal from the order of dismissal.

The effect of a dismissal is controlled by Rule 67.03, 2 which provides:

A dismissal without prejudice permits the party to bring another civil action for the same cause ... A dismissal with prejudice bars the assertion of the same cause of action or claim against the same party....

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Bluebook (online)
747 S.W.2d 317, 1988 Mo. App. LEXIS 506, 1988 WL 22111, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lick-creek-sewer-systems-inc-v-bank-of-bourbon-moctapp-1988.