Court Opinion

ID: 3162518
Source: CourtListenerOpinion
Date Created: 2015-12-15 14:06:38.379557+00
Date Added: 2024-06-11T11:59:34.572852
License: Public Domain

IN THE MISSOURI COURT OF APPEALS
                    WESTERN DISTRICT
CAPITAL FINANCE LOANS, LLC,              )
                                         )
             Appellant,                  )
                                         )
      v.                                 )        WD78621
                                         )
ANDREW READ,                             )        Opinion filed: December 15, 2015
                                         )
             Respondent.                 )

     APPEAL FROM THE CIRCUIT COURT OF JACKSON COUNTY, MISSOURI
               THE HONORABLE SANDRA MIDKIFF, JUDGE

               Before Division Three: Joseph M. Ellis, Presiding Judge,
                 Karen King Mitchell, Judge and Gary D. Witt, Judge

      Capital Finance Loans, LLC filed suit against Andrew Read in the Circuit Court of

Jackson County seeking a deficiency judgment against him following the repossession

and sale of his pickup truck. Read filed a motion to dismiss Capital Finance's amended

petition, asserting that Capital Finance had failed to comply with certain statutory

provisions relating to the notice to be given to him about the sale of the truck. The

circuit court entered a Partial Judgment and Order granting Read's motion to dismiss

and subsequently certified its partial judgment as final for the purposes of appeal. For

the following reasons, the appeal is dismissed.
       On November 10, 2012, Read entered into a Retail Installment Contract and

Security Agreement at a car dealership to fund the purchase of a 2004 Dodge Ram

pickup truck. That contract was assigned to Capital Finance pursuant to the terms of

the contract. After Read defaulted on his payments, on February 13, 2014, Capital

Finance filed a petition in the Circuit Court of Jackson County asserting causes of action

for replevin in the first count and breach of contract and deficiency in the second.

       On March 15, 2014, Capital Finance took possession of the truck and

subsequently sold it in a private sale. On July 28, 2014, Read filed his answer to the

petition and asserted counter-claims for violations of the Motor Vehicle Time Sales Act

and the Uniform Commercial Code. In his first counterclaim, Read asserted that the

installment contract for the truck failed to comply with § 365.070.06(7)1 of the Motor

Vehicle Time Sales Act because it did not contain certain required information and

sought a declaration that Read was not responsible for any time price differential,

delinquency, or collection charges on the contract; punitive damages; and attorneys'

fees. In his second counterclaim, Read asserted a class action claim against Capital

Finance for failing to comply with various presale notice requirements contained in §

400.9-614(1) of the Uniform Commercial Code prior to selling repossessed vehicles.

       On October 31, 2014, Capital Finance filed an Amended Petition reflecting the

repossession and sale of the vehicle. Among the exhibits attached thereto was the

notice of sale it had sent to Read.

       Read filed a motion to dismiss Capital Finance's Amended Petition, asserting that

Capital Finance had failed to comply with the provisions of § 400.9-614(1) by sending

1
 All statutory references are to RSMo 2000 as updated through the 2012 Cumulative Supplement unless
otherwise noted.

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him a notice of the sale for the vehicle that did not contain information required by the

statute. The trial court ultimately entered its Partial Judgment and Order granting that

motion, concluding that the notice of sale sent to Read failed to comply with the

requirements of § 400.9-614(1) because (1) it did not inform him of his right to an

accounting of the debt and the cost of any such accounting and (2) it failed to

adequately inform him of the time of the sale. The trial court subsequently certified its

Partial Judgment and Order as final for purposes of appeal.

       In its sole point on appeal, Capital Finance contends that the trial court

improperly dismissed its amended petition based upon an erroneous determination that

its notice of sale failed to comply with the relevant statutory requirements. It argues that

its notice of sale exceeded what was required because it actually provided Read with an

adequate accounting and sufficiently informed Read of the date after which the truck

would be sold.

       Before we can address the merits of an appeal, "[t]his court has a duty to

determine sua sponte whether we have jurisdiction to review [the] appeal." Gerken v.

Missouri Dep't of Soc. Servs., 415 S.W.3d 734, 737 (Mo. App. W.D. 2013).

"Generally, an appellate court only has jurisdiction over final judgments disposing of all

issues and parties, which leave nothing for future determination." Zeller v. Scafe, 455
S.W.3d 503, 505 (Mo. App. W.D. 2015) (internal quotation omitted). "An exception to

this rule is contained in Rule 74.01(b), which provides that the circuit court 'may enter a

judgment as to one or more but fewer than all of the claims or parties only upon an

express determination that there is no just reason for delay.'" Id.

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      However, "[a] trial court's designation of a judgment as final under Rule 74.01(b)

is effective only when the order disposes of a distinct 'judicial unit.'"     ABB, Inc. v.

Securitas Sec. Servs. USA, 390 S.W.3d 196, 200 (Mo. App. W.D. 2012) (internal

quotation omitted). "Stated differently, even if the circumstances suggest that judicial

economy could be promoted by certification of an interlocutory order as final, unless the

interlocutory order disposes of a distinct 'judicial unit,' the order cannot be properly

certified as final pursuant to Rule 74.01(b), rendering this court without jurisdiction to

entertain an appeal from the order." Id.     As noted by the Missouri Supreme Court in

Gibson v. Brewer, 952 S.W.2d 239, 244 (Mo. banc 1997):

        The required 'judicial unit for an appeal' has a settled meaning: the final
        judgment on a claim and not a ruling on some of several issues arising
        out of the same transaction or occurrence which does not dispose of the
        claim. An order dismissing some of several alternative counts, each
        stating only one legal theory to recover damages for the same wrong, is
        not considered an appealable judgment while the other counts remain
        pending because the counts are concerned with a single fact situation. It
        is "differing," "separate," "distinct" transactions or occurrences that permit
        a separately appealable judgment, not differing legal theories or issues
        presented for recovery on the same claim.

(internal citations and quotations omitted). "Claims are considered separate such that

their pendency will not prevent appeal following certification under Rule 74.01(b) if they

require proof of different facts and the application of distinguishable law, subject to the

limitation that severing the claims does not run afoul of the doctrine forbidding the

splitting of a cause of action." ABB, 390 S.W.3d at 201 (internal quotation omitted).

      "If a judgment disposes of fewer than all of the issues and remedies as to a

single claim, it is not an appealable judgment." Gerken, 415 S.W.3d at 739 (internal

quotation and emphasis omitted). "A judgment that fails to dispose of all remedies

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asserted as to the same legal rights, leaving some legal rights open for future

adjudication, is not a final judgment under Rule 74.01(b)." Id.

       This rule is applicable to "cross-claims or counterclaims arising out of the same

set of facts, and the same transactions and occurrences, as the dismissed claims or

counts appealed."     ABB, 390 S.W.3d at 201.         Analyzing whether a counterclaim

constitutes its own distinct judicial unit is best performed by first determining whether it

is a compulsory or permissive counterclaim. First Cmty. Credit Union v. Levison, 395
S.W.3d 571, 579 (Mo. App. E.D. 2013). If a counterclaim is compulsory, "then it must

be disposed of by the trial court before this Court may entertain authority as it would fall

under the same 'transactions and occurrences' (or 'judicial unit') as the claims sought

under [the] petition." Id. at 580. On the other hand, a permissive counterclaim may

constitute a separate judicial unit if it arises from a different transaction or occurrence

than the dismissed claims and requires proof of different facts and the application of

distinguishable law. Id.

       In this case, Capital Finance's motion asking the trial court to certify the judgment

as final under Rule 74.01(b) averred that "Read's counterclaim asserts a purported

statutory class action based on deficiencies in Capital Finance's pre-sale and post-sale

notices." Capital Finance went on to assert:

        As in [First Community Credit Union v. Levison, 395 S.W.3d 571,
        579 (Mo. App. E.D. 2013)], the central "transaction or occurrence'
        giving rise to Capital Finance's claim is Andrew Read's breach of
        contract. The central 'transaction or occurrence' giving rise to Andrew
        Read's counterclaim is allegedly improper pre-sale and post-sale
        notices. Thus, the two claims are separate and distinct judicial units,
        and this Court may enter a final and appealable judgment as to Capital
        Finance's claim while Andrew Read's counterclaim still pends.

                                             5
Capital Finance failed to mention, however, the other counterclaim brought by Read in

this case.

       In his suggestions in opposition to the motion to certify, Read merely argued that

Capital Finance's claim on appeal would not be an "issue of first impression" and that it

would not succeed on the merits. He made no reference to the existence of the other

counterclaim contained in his petition and offered no argument regarding whether a

distinct judicial unit was resolved by the partial judgment.

       The trial court eventually granted Capital Finance's motion and certified its partial

judgment for appeal. In so doing, it expressly relied on Levison, which would appear

directly on point with regard to whether Read's second counterclaim was a separate

judicial unit from the dismissed claims.

       Even assuming, arguendo, that this Court would follow the decision of the

Eastern District in Levison and hold that Read's second counterclaim related to the

sufficiency of the pre-sale notice provided by Capital Finance constitutes a separate

judicial unit from Capital Finance's breach of contract claim against Read, the record

does not reflect that Read's first counterclaim related to the provisions of the installment

contract has been resolved. As that counterclaim relates directly to the contract upon

which Capital Finance's breach of contract claim is based, it is a mandatory

counterclaim and cannot be viewed as a separate judicial unit from the breach of

contract claim. Since that counterclaim is still pending, the trial court's partial judgment

has clearly not resolved an entire judicial unit and certification of the judgment as final

for purposes of appeal was improper. ABB, 390 S.W.3d at 203.

                                             6
       Because the partial judgment does not resolve an entire judicial unit and was

improperly certified, this Court does not have jurisdiction to entertain the appeal. Id. at

204.   The appeal is, therefore, dismissed, and the cause is remanded for further

proceedings consistent with this opinion.

                                                ________________________________
                                                Joseph M. Ellis, Judge
All concur.

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