## United States Court of Appeals FOR THE EIGHTH CIRCUIT

___________ No. 11-2327

___________ Bridget Rashaw; Matthew Hutchinson, *
* Plaintiffs - Appellants, *
* v. *
* United Consumers Credit Union, *
* Defendant - Appellee. *

___________ No. 11-2329 Appeals from the United States ___________ District Court for the Western District of Missouri. Michael J. Knight, *
* Plaintiff - Appellant, *
* v. *
* Central Communications Credit Union, *
* Defendant - Appellee. *

___________ No. 11-2331

___________ Bernard W. Moran, *
* Plaintiff - Appellant, * v. ** Missouri Central Credit Union, *
* Defendant - Appellee. *

___________ Submitted: February 15, 2012 Filed: July 17, 2012

___________ Before LOKEN, BYE, and MELLOY, Circuit Judges.

___________ LOKEN, Circuit Judge. Four named plaintiffs filed three separate class action lawsuits in state court alleging, inter alia , that three Missouri credit unions , by participating in a subprime motor vehicle lending and investment progr am administered by now-bankrupt Centrix Financial, LLC (“Centrix”), violated provi sions of the Missouri Uniform Commercial Code (“Mo UCC”) and the Missouri Me rchandising Practices Act (“MMPA”). Defendants removed under th e Class Action Fairness Act, 28 U.S.C. § 1332(d), and moved to dismiss the complaints. The district court 1 issued three identical orders dismissing all the state law claims. Plainti ffs appeal the dismissal of the statutory claims; we granted their unopposed motion to consolidate the three appeals. We review the dismissals de novo , taking the allegations in the complaints as true. See O'Neal v. State Farm Fire & Cas. Co. , 630 F.3d 1075, 1077 (8th Cir. 2011) (standard of review). We agree with the district c ourt that plaintiffs’ Mo UCC claims are timebarred, although our analysis of that issue is somewhat different, and that the MMPA expressly exempts Missouri credit unions. Accordingly, we affirm.

1 The Honorable Ortrie D. Smith, United St ates District Judge for the Western District of Missouri.
-2-I. The Mo UCC Claims.

The limitations issue presented on appeal requires us to de fine relationships between statutes of limitations that have been part of the codified Missouri statutes since 1865. The law declaredby the State’s highest court governs these questions of state law. Washington v. Countrywide Home Loans, Inc. , 655 F.3d 869, 873 (8th Cir. 2011). Here, the crucial issue is whether the Supreme Court of Missouri would follow a recent decision by the Missouri Court of Appeals that completely ignored controlling Supreme Court decisions under prio r codifications of the relevant statutes that in our view required a contrary decision.

The complaints allege thateach plaintiff obtained a secured motor vehicle loan from a defendant credit union under the “Portfolio Management Program” administered by Centrix as agen t for the credit unions. Plain tiffs allege that, after loan defaults, the credit unions through the actions of Centrix violatedRevised Article 9 of the Mo UCC by sending deficient collate ral disposition notices before selling the repossessed vehicles. See Mo. Rev. Stat. §§ 400.9-611-614. 2The notices were sent between December 20, 2004, and January 20, 2005. The complaints were filed between November 24 and December 15, 2010, nearly six years later.

The Missouri statutes of limitations for civil actions include two provisions governing actions to enforce statutory liabilities: an action “upon a liability created by a statute other than a penalty or forfeitu re” must be commencedwithin five years, Mo. Rev. Stat. § 516.120(2); an action “upon a statute for a pena lty or forfeiture, where the action is given to the party aggrie ved, or to such party and the state,” must be commenced within three years, Mo. Rev. Stat. § 516.130( 2). The parties agree that

2 The purpose of these requirements is to “apprise a debtor of the details of a sale of collateral so that he or she may take whatever action is necessary to protect his or her interest therein.” Victory H ills Ltd. P’ship I v. Nationsbank, N.A. , 28 S.W.3d 322, 330 (Mo. App. 2000).
-3-the violations of Revised Article 9 of the Mo UCC alleged by plaintiffs are statutory liabilities. Thus, it would seem that those claims, filed nearly six years after receipt of the allegedly deficient collateral di sposition notices, are clearly time-barred.

The issue arises because a long-standing but rarely applied statute provides a six-year limitations period for some actions to recover penalties or forfeitures from “moneyed corporations”:

None of the provisions of secti ons 516.380 to 516.420 shall apply to suits against moneyed corporations or against the directors or stockholders thereof, to recover any penalty or forfeiture imposed, or to enforce any liability created by the act of incorporation or any other law; but all such suits shall be brought w ithin six years after the discovery by the aggrieved party of the facts upon which such penalty or forfeiture attached, or by which such liability was created.

Mo. Rev. Stat. § 516.420. Plaintiffs argue this six-year limitations period applies because the defendant credit unions are “moneyed corporati ons.” They further argue that the remedy provided in § 400.9-625(c)(2) for violations of the Mo UCC collateral disposition notice requirements is a penalty. 3

In arguing that § 516.420 applies to their claims, plaintiffs rely primarily on Schwartz v. Bann-Cor Mortgage , 197 S.W.3d 168, 178 (Mo. App. 2006). In that case, defendant argued that a claim under the Mi ssouri Second Mortgage Loan Act was a claim for a penalty barred by the three-y ear statute of limitations in Mo. Rev.

3 This statute provides that, if the colla teral is consumer goods, the debtor may recover “in any event an amount not less th an the credit servi ce charge plus ten percent of the principal amountof the obligation or the tim e-price differential plus ten percent of the cash price.” Plaintiffs also argue that the possibility a deficiency judgment will be barred under § 400.9-626(b) is a forfeiture. The “no notice-no deficiency” remedy is not prescribed in § 400.9-626(b) and thus may not be a statutory liability. See Victory Hills , 28 S.W.3d at 330.
-4-Stat. § 516.130(2). The Court of Appeals in stead held that the six-year statute of limitations in § 516.420 applied. After thoroughly reviewing the New York origins of this 1865 statute, the Court conclude d that the term “moneyed corporations” includes real estate mo rtgage lenders. Id. at 171-77. The court then dealt summarily with the question whether § 516.130(2) or § 516.420 applied:

Section 516.130(2) would apparently apply here if this were not an action against a “moneyed corpor ation.” Section 516.420 is the more specific statue of the two because it deals with claims against “moneyed corporations.” The fact that section 516.130(2) does not fall into the range of the specific excepted statutes mentioned in 516.420 makes no difference in that section 516.420 remains the more specific statute between the two.

Id. at 178 (emphasis added; footnote omitted). 4 In the district court, although defendants vigorously argued th at § 516.420 does not apply at all to plaintiffs’ claims, the court accepted the contrary conclusion in Schwartz but then ultimately concluded that § 516.420 does not apply to these claims because the remedies in § 400.9-625 are not “penalties or forfeitures.” Though that is the issue plaintiffs primarily argue on appeal, the threshold conclusion in Schwartz requires a closer look.

The problem with that conclusion is most sharply focused by the Supreme Court of Missouri’s decision in State ex rel. Fichtner v. Haid , 22 S.W.2d 1045 (Mo. 1929), upholding Fichtner v. Mohr , 16 S.W.2d 739 (Mo. App. 1929). In that case, plaintiff sued the directors of an insolv ent bank -- clearly a “m oneyed corporation” --

4 In Fielder v. Credit Acceptance Corp. , 19 F. Supp. 2d 966, 975 (W.D. Mo. 1998), the district court reached the same c onclusion, simply citing an earlier Missouri Court of Appeals decision that did not address this issue, Nolan v. Kolar , 629 S.W.2d 661, 664 (Mo. App. 1982). We did not discuss the issue in vacating the decision in Fielder on other grounds, 188 F.3d 1031 (8th Ci r. 1999). In our view, Schwartz is the relevant precedent in deciding this appeal.

-5-to recover lost deposits. The action was file d more than five but less than six years after the bank failed. The Supreme Court he ld that it would not disturb the Court of Appeals decision that the action was for a statutory penalty, it accrued when the bank failed, and therefore it was barred by the three-year statute of limitations in the predecessor to § 516.130(2). 22 S.W.2d at 1047-48. Neither Court cited the predecessor to § 516.420, yet if Schwartz was correctly decided, that statute would have compelled a conclusion that the clai m was not time-barred because it was filed within six years. Likewise, in Vroom v. Thompson , 55 S.W.2d 1024, 1025-27 (Mo. App. 1932), the court held that a claim agai nst the directors of a moneyed corporation was time-barred by the three-year limitati on in the predecessor to § 516.130(2) even though the predecessor to § 516.420 as construed in Schwartz would have compelled a contrary conclusion.

The lack of any reference to the pr edecessor to § 516.420 in these early cases is no doubt attributable to the Supreme Court of Missouri’s prior decision in State ex inf. Attorney General v. Arkansas Lumber Co. , 169 S.W. 145 (Mo. 1914). In that case, the Attorney General sought large fine s and the forfeiture of corporate charters for a long-running price fixing conspiracy thatviolated the Missouri antitrust statutes. The Attorney General argued that no statute of limitations applied; the Court rejected that argument as contrary to a specific statute. Id. at 168. Defendants argued for a three-year limitations period under both the predecessor to § 516.130(2) and the predecessor to § 516.400, a statute included in the preamble to § 516.420 that applies to “actions upon any statute fo r any penalty or forfeiture, gi ven in whole or in part to the party aggrieved.” 5 The Supreme Court agreed thatthree years was the applicable limitations period but firmly rejected the latter contention:

The sections quoted from the criminal law, and providing for limitations for the bringing of acti ons for penalties and forfeitures, as

5 The parties’ arguments are reported in 1914 Mo. LEXIS 119 at pp. 4-5.

-6-urged by [defendants], do not apply, for the very clear reason that this, as we have seen above, is a civ il action, and not a criminal action; therefore the statute of limitations providing for the time within which civil actions must be brought [the predecesso r to § 516.130(2)] must govern and guide us.

Id. at 171. With this clear precedent, the Court and the parties in Haidhad no reason to revisit the issue a few years later.

The next intriguing question is why the Court of Appeals in Schwartz , which looked carefully at the history of § 516.420, overlooked these earlier, seemingly controlling Supreme Court decisions. We su spect the answer lies in the statutory recodification process. The precursors to § 516.120(2) and § 516.130(2) were enacted as § 4 Second and § 5 Second of the Laws of 1849, pp. 74-75. In the General Statutes of 1865, the Legislature for the first time in cluded two distinct three-year statutes of limitations for actions for statutory penaltie s and forfeitures. One -- the precursor to § 516.130(2) -- appeared in the Chapter entitled, “of the Limitation of Real and Personal Actions,” Ch. 191 § 11 (where the precursor to § 516.120(2) also appeared as Ch. 191 § 10). The other -- the precursorto § 516.400 -- appeared in the Chapter entitled, “of the Limitation of Criminal Pro secutions and Actions on Penal Statutes,” Ch. 190 § 8. Chapter 190 also included the precursor to § 516.420 and the other statutes excepted by the preamble to § 516.420. SeeCh. 190 §§ 6-10. A good indication of the scope of Chapter 190 is that §§ 1-5 prescribed the statutes of limitations for criminal prosecutions. In other words, § 516.420 was initially enacted as part of the criminal laws of the State.

The dichotomy first appearing in Chap ters 190 and 191 of the General Statutes of 1865 persisted throughout the next eighty years of recodifications. Indeed, the separation became more pronounced. In the Revised Statutes of 1919, for example, the statutes at issue in Haid , the precursors to § 516.120(2) and § 516.130(2) are found

-7-in § 1317 and § 1318 of Chapter 12, the Civ il Procedure Code, whereas the precursors to §§ 516.380-.420 are found in §§ 3741-45 of Chapter 25, the Criminal Procedure Code. The same distancing can be found in the Revised Statutes of 1929 and 1939. No wonder, then, that the Courts in Haid and in Vroom saw no need to discuss the precursors to § 516.420 in applying the precursors to § 516.130(2).

This structural landscape changed drama tically in the Revised Statutes of 1949, when the Committee on Legislative Research broke off the st atutes of limitations for criminal prosecutions, now found primarily in Mo. Rev. Stat. § 556.036, from the statutes of limitations for actions on pena l statutes. The latter were placed in a subchapter of Chapter 516 en titled, “Actions on Penal St atutes,” which contained only §§ 516.380-.420. Chapter 516 also contai ns § 516.120(2) and § 516.130(2) in a subchapter entitled, “Personal Actions a nd General Provisions.” We find nothing in this restructuring even hinting that th e revisers intended to alter the scope of § 516.420. As construed by the Supreme Court of Missouri since at least its Arkansas Lumberdecision in 1914, that statute applied only to penalties and forfeitures authorized by criminal (“penal”) statutes , not to penalties and forfeitures authorized in civil statutes, which are governed by § 516.130(2). Thus, the Legislature’s omission of § 516.130(2), a civil statute, from the listing in § 516.420 of the criminal statutes of limitations that do not apply to “moneyed corporations” was substantive and intentional. In conc luding otherwise, Schwartz misinterpreted these statutes by overlooking the significance of the “Actions on Penal Statutes” subchapter in Chapter 516 of the 1949 recodification.

The final question is what the Supreme Court of Missouri would make of this complex and confusing history. Th e Court might decide that Schwartz provides the best interpretation of the current § 516.420. But Schwartz ignored both relevant legislative history and what should have been controlling (though dated) Supreme Court precedents. In Hughes Development Co. v. Omega Realty Co. , 951 S.W.2d

-8-615, 616-17 (Mo. 1997), the Court concluded that “Missouri appellate courts have lurched unevenly” in applying these statutes of limitations for “nearly a century and a half” and therefore felt “fully justified in ignoring the precedent in favor of the statute itself.” We conclude the Court would do the same if presented with this question and would hold that § 516.420 is limite d to penal statutes and does not apply to civil actions to recover penaltie s and forfeitures governed by § 516.130(2).

With § 516.420 limited in this fashion, plaintiffs’ Mo UCC claims are timebarred whether they are claims for st atutory liabilities governed by the five-year statute of limitations in § 516.120(2), or by the three-year statute of limitations in § 516.130(2) for actions “upon a statute for a penalty or forfeiture, where the action is given to the aggrieved party.” 6 We therefore affirm the district court’s dismissal of the Mo UCC claims because we agree that these claims clearly accrued when plaintiffs received the allegedly facially defici ent collateral disposition notices. See Chem. Workers Basic Union Local No . 1744 v. Arnold Sav. Bank , 411 S.W.2d 159, 165 (Mo. banc 1966), applying Mo. Rev. Stat. § 516.100; see also Powel v. Chaminade Coll. Preparatory, Inc. , 197 S.W.3d 576, 584 (Mo. banc 2006) (“all possible damages do not have to be known, or even knowable, before the statute accrues”). Given these conclusions, we need not decide and do not consider whether the remedies in §§ 400.9-625(c)(2) and .9-626(b) include “pen alties or forfeitures,” nor whether the defendant credit unions are “moneyed corporations.”

6 Plaintiffs’ broader argument that § 516.420 applies to all statutory actions against moneyed corporations, based on the statute’s reference to “any liability . . . created by any other law,” plainly cannot su rvive the statute’s limited application to penal statutes. AccordGlen v. Fairway Indep. Mortg. Corp. , 265 F.R.D. 474, 476-77 (E.D. Mo. 2010).

-9-II. The MMPA Claims.

Plaintiffs’ complaints alleged that the credit unions violated the MMPA, Mo. Rev. Stat. §§ 407.010 et seq., which prohib its deceptive conduct in connection with the sale of merchandise, by making material omissions when the car loans were made, using collateral disposition notices that vi olated the Mo UCC, and using misleading communications when the Mo UCC violations were discovered. The district court dismissed these claims as barred by th e MMPA’s express exemption for Missouri credit unions:

Nothing contained in this section shall apply to . . . (2) Any institution, company, or entity that is subject to chartering, licensing, or regulation by . . . the director of the division of credit unions under chapter 370 . . . unless such director[] specifically au thorize[s] the attorney general to implement the powers of this chap ter or such powers are provided to either the attorney general ora private citizen by statute.
§ 407.020.2. On appeal, conceding that th e defendant credit unions are chartered and subject to regulation in Missouri, plaintiffs argue that the district court erred when it failed to narrowly construe th e exemption by ruling (i) that it does not apply to claims that “relate directly to the federal regulation of Defendant s,” and (ii) that the second clause of § 407.020.2 “negates the ex emption” because the MMPA in § 407.025 allows private citizens to “implement the powers” of Chapter 407 by recovering monetary losses caused by unlawful practices . The district court rejected these contentions as contrary to the plain language of § 407.020.2. We agree. The contention that one provision of the MMPA co mpletely negates another violates wellaccepted principles of statutory construction.

Like the district court, we need not address whether the MMPA claims are timebarred. See Owen v. Gen’l Motors Corp. , 533 F.3d 913, 921 n.6 (8 th Cir. 2008) (fiveyear limitations period in § 516.120 applies to MMPA claims).

-10-The judgments of the district court are affirmed.

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