United States Court of Appeals FOR THE EIGHTH CIRCUIT

___________ No. 96-1794/1795

___________ National Liberty Corporation; * Worldwide Underwriters Insurance * Company, * * Appellants/Cross Appellees, * * v. * Appeal and Cross-Appeal from the * United States District Court for the Wal-Mart Stores, Inc., doing business * Eastern District of Missouri. as Sam's Club; Sedgwick James of * Arkansas, Inc., * * Defendants, * * Sedgwick James Group Service, Inc., * * Appellee/Cross Appellant. *

___________ Submitted: January 15, 1997 Filed: August 13, 1997

___________ Before BEAM, ROSS and HANSEN, Circuit Judges.

___________ ROSS, Circuit Judge.The Honorable Catherine D. Perry, United States District Court Judge for the 1 Eastern District of Missouri. -2- National Liberty Corporation and World wide Underwriters Insurance Company (collectively referred to as National Liberty) appeal from the district court’s denial of 1 their Fed. R. Civ. P. 50(b) mo tions for judgment as a matter of law or alternatively for a new t rial on the counterclaim of Sedgwick James Group Service, Inc. (SJGS), fo r which the jury awarded SJGS $202,023 in damages. SJGS’s counterclaim was a single caus e of action for breach of contract based on a contract originally entered int o between National Liberty and Sedgwick James of Arkansas, Inc. (SJA). In its motion fo r Rule 50(b) relief, National Liberty argued that SJGS failed to establish privity o f contract between the parties, where as no evidence was offered to show that SJGS had satisf iedthe contractual requirement that written consent was needed in order t o effectuate an assignment. National Liberty also asserts that even if SJGS had a right to sue under the contract, the amount of the allowable recovery is limited by the terms of the contract and precludes the type of damages awarded by the jury. SJGS cros s appeals on th e district court’s denial of its untimely motion to amend its counterclaim to asse rt a claim for attorney’s fees. After a careful review of the record, briefs an d arguments of the parties, we affirm in full.
I.
National Liberty, a company engaged in direct-mail marketing and sales o f insurance policies, entered into a contract entitled the “referral agreement” with SJA, which called for the two companies to work together on a plan to market Nationa l Liberty’s insurance products to Sam’s Club members. SJA, broker of record for Sam’s Club, acted as intermediary between National Liberty and Sam’s Club via an entity known as Members Insurance Club (MIC). Through MIC, National Liberty bega n offering insurance to Sam’s Club members. Under the terms of the referral agreement,-3-

SJA was to receive a 2.5% commission on premiums for insurance policies issued to and renewed by Sam’s Club members. In December 1993, due to the loss of major corporate bu siness, SJA was forced to close its Tulsa offi ce, the same office that managed MIC. Prior to the closing, SJA arranged for SJGS to assume its role in marketing Nationa l Liberty insurance to Sam’s Club members, and accordingly SJGS received a broker of record letter from Sam’ s Club, whic h allowed SJGS to contact all insurance carriers providing insurance t o Sam ’s Club members through MIC. According to SJGS, National Liberty wa s informed of the change and immediately began working with SJGS.
In February 1994, Sam’s Club terminated the insurance program. As a result , National Liberty discontinued paying commissions to SJGS and brought a multi-count action against SJA, SJGS and Sam’s Club. In response, SJGS brought thi s co unterclaim

against National Liberty seeking payment of commissions under th e referral agreement.
A jury retur ned a verdict in favor of SJGS, SJA and Sam’s Club on Nationa l Liberty’s suit. The jury also found in favor of SJGS on its counterclaim, concludin g that National Liberty owed SJGS commissions on premiums received now and those to be colle cted from future renewals. Thereafter, the district court denied Nationa l Liberty’s Rule 50(b) motion f or judgment as a matter of law or alternatively for a new trial on the counterclaim. During the pendency of the trial, SJGS filed an u ntimely motion for leave to file an am ended counterclaim seeking attorney’s fees provided for under the referra l agreement, and prejudgment interest pursuant to Mo. Rev. Stat. § 408.0 20. The district court refused to all ow SJGS to file its amended counterclaim and later denied SJGS’s post-trial motion to consider the issue of attorney’s fees.-4- II.
Nati onal Liberty first asserts that the counterclaim should not have bee n submitted to the jury because SJGS failed to establish that it was a proper party t o assert a breach of the referral agreement which had originally been entered int o between National Liberty and SJA. SJGS argues, on the other hand, that by it s actions , National Liberty consented to the assignment of the referral agreement t o SJGS, thereby effectively waiving the contractual requirement that an assignment be made in writing.
Under Missouri law, waiver is the intentional relinquishment of a known right which may be implied from a party’s conduct. To be so implied, the party’s conduct must “be so manifestly consistent with and indicative of an intention to renounce a partic ular right or benefit that no other reasonable explanation of [the] conduct i s possible.” Silver Dollar City v. Kitsmille r Constr. Co. , 931 S.W.2d 909, 916 (Mo. Ct. App. 1996) (citation omitted).
SJGS introduced evidence at trial that once it assumed SJA’s role in marketing insurance to Sam’s Club members, it promptly notified National Liberty by letter that SJGS had been appointed as Sam’s agent and broker of record with respect to al l Sam’s Club members’ insuranc e programs and that with the closing of the SJA office, all commissions, information, phone calls, etc. should be directed to SJGS. Lind a Berger , senior account manager for National Liberty, acknowledged receipt of tha t letter, beginning with the salutation, “Welcome to the SAM’s account!” Shortl y thereafter, an introductory meeting between SJGS and National Liberty management was held. Ms. Burger testified at trial regarding her understanding that the SJ A business w ould be transferred to SJGS and that the program would continue as it had been. She stated that “[ t]hey [SJGS] were going to do the same things that [SJA] had done for us.”-5-

Also at trial, SJGS’s expert, Bob Seiffert, testified that National Liberty sen t commission checks to SJGS and a greed to reissue those checks payable to SJGS after SJGS complained that the payee had been incorrectly listed as SJA. Only after th e program was canceled by S am’s Club did National Liberty refuse to make any further com missionpayments. However, National Liberty continued to keep a ledger o f commissions owed but not paid to “Sedgwick James Group Ser.” Clearly, there was sufficient evidence presented at trial to submit th e counterclaim to the jury and for the jury to conclude that SJGS had effectively stepped into SJA’s shoes with respect to the re ferral agreement. Indeed, National Liberty read to the jury the following request for admission by National Liberty and SJGS’ s response to that admission:
21. SJGS succeeded to and assumed the same rights, duties an d obligations possessed by SJA in its relationship with p laintiffs with regard to the sales, marketing, and promotion of insurance to Sam’s Clu b members. Response: SJA and SJGS admit the request. By its own actions, National Liberty exhibited its clear and unequ ivocal intention to accept SJGS’s assignment and thereby waived its right under the agreement t o require written consent to the assignment.

We al so reject National Liberty’s argument that the waiver and assignmen t arguments are raised for the first time on appeal and thus t he issues were not before the trier of fact. On the contrary, the jury was specifically instructed that in order to find in favor of SJG S on its counterclaim it must determine that SJGS “assumed the rights-6-

of [SJA] a nd [National Liberty] agreed to pay [SJGS] the commissions due under the referral agreement.” Instruction No. 22. The jury clearly found in SJGS’s favor on this point.

III.

National Liberty next challenges the nature of the damages awarded to SJG S under the referral agreement. The j ury awarded damages in the amount of $76,000 in past commissions and $117,000 in f uture commissions, based on a ten-year projection of renewals of policies sold before termination of the insurance program, discounte d to prese nt value. With interest, the total damages awarded to SJGS amounted t o $202,023. National Liberty contends that the language of the referral agreement, which provides that National Liberty shall pay commissions on “al l first year and renewal Net Collected Premium actually received,” preclude s the jury verdict of $117,000 awarded forthe projected future commissions. According to National Liberty, the referra l agreement, which calls for payment of commi ssions “within thirty (30) days of the end of the month in which [National Liberty] actually receives the premium,” establishes
a me thod of calculation and mode of payment that prohibits an award of damage s based on premiums not yet received. We disagree.

An anticip atory repudiation by an obligor to a contract gives the obligee th e right to treat the agreement as broken and to sue immediately for damages for a total breach of cont ract. Reed v. Reberry , 883 S.W.2d 59, 63, 64 (Mo. Ct. App. 1994)

. Under the terms of the agreement, SJGS was entitled to receive commissions on al l “first year and renewal” premiums generated from the sale of insurance policies toParagraph 8 of the referral agreement provides: 2 8. Indemnification . The parties hereby agree to indemnify, release and hold the other parties hereto . . . harmless from and against any and al l losses . . . including, but not limited to, reasonable attorney fees that such oth er parties may incur as a result of or relating to the indemnifyin g party’s breach of this Agreement. -7- Sam’s Club members. National Liberty unequivocally renunciated the referra l agreeme nt

and its obligations thereunder when it refused to continue the payment o f commissions. Accordingly, SJGS had the option to treat the contract as broken and to
sue immediately for damages for total breach, including damages based on projected premium renewals. Once National Liberty repudiated the referral agreement, it waived its right to insist upon adherence to the mode of payment outlined in the agreement.

IV.

In its cr oss appeal, SJGS argues that the district court abused its discretion i n denying its motion to amend its counterclaim seeking to assert a claim for attorney’s fees under the terms of the referral agreement and in denying its post-trial motion for 2 attorney’s fees. Attorney’s fees are “special damages” that parties are required t o plead under Rule 9(g) of the Federal Rules of Civil Procedure. See Western Cas. & Surety Co. v. So uthwestern Bell Tel. Co. , 396 F.2d 351, 356 (8th Cir. 1968). Failure to plead sp ecial damages can be cured by amendment of the pleadings, under Rul e 15(a) of the Federal Rules of Civil Procedure, which provides that a party may amend a pleading “only by leave of court or by written consent of the adverse party; and leave shall be freely given when justice sorequires.” Fed. R. Civ. P. 15(a). The decision to-8-

grant or deny a motion to amend a pleading is within the sound discretion of th e district court

. Brown v. Wallace , 957 F.2d 564, 565 (8th Cir. 1992). SJGS contends that in s eeking to file its amended counterclaim, it was merely clarifying the damages it alleged it was entitled to under the referral agreement. According to the district court’s scheduling order, March 30, 1995 was th e deadline for any amendments to the pleadings. SJGS filed its motion for leave t o amend on June 23, 1995, almost three months after the court’s deadline, withou t explanat ion for its untimeliness. The district court found that National Liberty would be prejudiced by the untimely amendment because it had already completed depositions of witnesses who were likely to have kno wledge of such a claim, and adding the claim after the amendment deadline wo uld have required retaking those depositions. We do not believe the finding of prejudice was clearly erroneous. The district court als o denie d the post-trial motion, concluding that SJGS had two opportunities to plea d attorney’s fe es -- in the initial counterclaim and in a timely Rule 15 motion. SJG S failed to do so and has not asserted anyreason for its failure. The court did not abuse its discretion in denying the motions relating to attorney’s fees.

V.

In s um, we conclude that privity of contract was established and th e counterclaim was properly before the jury; the damage award relating to commissions
on future renewals was proper; and the court did not abuse its discretion in denyin g SJG S’s motions regarding attorney’s fees. The judgment of the district court i s affirmed.-9-

A true copy.

Attest:
CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.