Court Opinion

ID: 9783692
Source: CourtListenerOpinion
Date Created: 2023-08-30 20:01:19.289634+00
Date Added: 2024-06-11T07:35:32.857102
License: Public Domain

CYNTHIA L. MARTIN, Presiding Judge.
I respectfully dissent from the majority opinion’s conclusion that Jackson Hewitt is a “credit services organization” subject to the provisions of sections 407.635 to 407.644. I would affirm the trial court’s dismissal of Fugate’s petition.
I agree with the majority opinion’s observation that in interpreting the credit services organization statutes to determine their applicability to Jackson Hewitt, we must “ ‘ascertain the intent of the legislature from the language used, [ ] give effect to that intent if possible, and [ ] consider the words in their plain and ordinary meaning.’ ” S. Metro. Fire Prot. Dist. v. City of Lee’s Summit, 278 S.W.3d 659, 666 (Mo. banc 2009) (citation omitted). I disagree, however, with the manner in which the majority has undertaken to ascertain the intent of the legislature. The majority has assessed legislative intent by isolating its focus on section 407.637.1 without regard to the fact that section 407.637.1 is but one statute within the Credit Services Organization Act, sections 407.635 to 407.644 (“Act”). In doing so, the majority has improvidently applied a dictionary definition of the word “purchase” in a manner that is inconsistent with the plain and usual meaning of the word. As a result, the majority has ascribed a meaning to the definition of “credit services organization” that is inherently inconsistent with other provisions of the Act.
Section 407.637.1 defines a credit services organization as:
1. A credit services organization is a person who, with respect to the exten*90sion of credit by others and in return for the payment of money or other valuable consideration, provides or represents that the person can or will provide any of the following services:
(1) Improving the buyer’s credit record, history or rating;
(2) Obtaining an extension of credit for a buyer; or
(3) Providing advice or assistance to a buyer with regard to subdivision (1) or (2) of this subsection.
(Emphasis added.) Fugate contends that section 407.637.1(2) applies to this case. Thus, Fugate’s petition had to assert that (a) she was a “buyer,” and (b) that Jackson Hewitt, “in return for the payment of money or other valuable consideration” obtained an extension of credit for her. More to the point, Fugate’s assertions with respect to these two essential components of her claim must fit within the contours of the legislature’s intended meaning of “buyer” and “in return for the payment of money or other valuable consideration” in order for Fugate’s petition to survive a motion to dismiss.
Fugate’s petition asserts that “Fugate indirectly paid Jackson Hewitt for arranging” a refund anticipation loan (“RAL”). Fugate’s petition further asserts that “Jackson Hewitt received money from SBBT in connection with the extension of credit to ... Fugate.” Fugate’s petition thus concedes that she did not pay Jackson Hewitt directly, and that she did not have an obligation to pay Jackson Hewitt directly, for its service in putting her in contact with Santa Barbara Bank & Trust (“SBBT”), from whom Fugate sought and obtained an extension of credit. Fugate’s petition concedes that the only entity with whom she had a contract for the extension of credit, and the only entity which received payment of money from her for the extension of credit, was SBBT. As the majority correctly notes, the debate in this case focuses on whether the legislature intended the Act to cover indirect transactions of this nature. Stated differently, we must ascertain whether the legislature intended to require that a person directly pay, or have a direct obligation to pay, an entity before that person is a “buyer” with respect to the entity, and before the entity can be said to have provided a service “in return for the payment of money or other valuable consideration” to the buyer.
Fugate suggests that the word “buyer” and the phrase “in return for the payment of money” should be construed to permit the direct or indirect payment of money from the purported buyer to the purported credit services organization. Jackson Hewitt suggests that the word “buyer” and the phrase “in return for the payment of money” should be construed to require the direct payment of money from the purported buyer to the purported credit services organization.

Ascertaining Legislative Intent

Statutory construction is a matter of law. City of St. Joseph v. Vill. of Country Club, 163 S.W.3d 905, 907 (Mo. banc 2005). “The goal of statutory analysis is to ascertain the intent of the legislature, as expressed in the words of the statute.” United Pharmacal Co. of Mo., Inc. v. Mo. Bd. of Pharmacy, 208 S.W.3d 907, 909-10 (Mo. banc 2006). There is no need to resort to the rules of statutory construction to ascertain legislative intent where the language of the statute is unambiguous and clear. Maxwell v. Daviess Cnty., 190 S.W.3d 606, 610 (Mo.App. W.D.2006). The first step, therefore, in this case, is to read section 407.637.1 in its “plain, ordinary, and usual sense.” Bosworth v. Sewell, 918 S.W.2d 773, 777 (Mo. banc 1996). In fact, we are directed by the legislature to do just that pursuant to section 1.090, which *91provides that “[w]ords and phrases shall be taken in their plain or ordinary and usual sense.” In so doing, we are also required to afford words that are defined by the legislature their statutory definition. State ex rel. Ashcroft v. Union Elec. Co., 559 S.W.2d 216, 221 (Mo.App.1977).
Section 407.635(1) defines a “buyer” as “an individual who is solicited to purchase or who purchases the services of a credit services organization.” (Emphasis added.) The clearly operative word in the statutory definition of “buyer” is the word “purchase.” “Purchase” is not defined, however, in section 407.635. Similarly, neither the phrase “in return for the payment of money or other valuable consideration” nor its components terms, are statutorily defined. Thus, we afford the word “purchase,” and the words “in return” and “payment” their “plain and ordinary meaning, as typically found in the dictionary.” Derousse v. State Farm Mut. Auto. Ins. Co., 298 S.W.3d 891, 895 (Mo. banc 2009).

Purchase

As the majority notes, one dictionary defines “purchase” as “to obtain (as merchandise) by paying money or its equivalent: buy for a price.” WEBSTER’S THIRD NEW INTERNATIONAL DICTIONARY OF THE ENGLISH LANGUAGE UNABRIDGED 1844 (1993). This definition addresses the “purchaser” side of a transaction but is silent about the “seller” side of the transaction. The majority affords legal significance to this silence and presumes the definition of “purchase” is broad enough to include transactions where a third party receives some benefit from the payment of money by a purchaser to a seller. In other words, in the context of this case, the majority would ascribe the word “purchase” not only to the transaction between Fugate and SBBT (where Fugate clearly paid money to SBBT to “buy” an RAL) but also to the transaction between Fu-gate and Jackson Hewitt (where Fugate paid no money to Jackson Hewitt except for the service of tax preparation). I disagree with the majority’s application of the dictionary definition of “purchase” in this manner, as it is inconsistent with the plain, ordinary, and usual sense of the word.
I suggest that the plain, ordinary, and usual sense of the word “purchase” anticipates a direct transaction between the buyer of a product or service and the seller of that product or service. For example, the purchaser of a residence is commonly understood to be so, but only with respect to the seller of the residence, and not with respect to the real estate broker all knew would derive a commission from the sale. The purchaser of retail goods is commonly understood to be so, but only with respect to the retailer selling the goods, and not with respect to the taxing authority for whom sales taxes were paid by the purchaser and collected by the retailer. The purchaser of an item consigned for sale is commonly understood to be so, but only with respect to the consignment shop, and not with respect to the person who consigned the item for sale. The purchaser of an extended warranty package on a vehicle is commonly understood to be so, but only with respect to the entity offering the extended warranty, and not with respect to the car dealer who may receive a fee from the sale. This “usual sense” of the word “purchase” is consistent with the manner in which the term has been construed by our courts. See, e.g., Becker Elec. Co., Inc. v. Dir. of Revenue, 749 S.W.2d 403, 407 (Mo. banc 1988) (“We hold that a purchaser ... is the person who acquires title to, or ownership of, tangible personal property, or to whom is rendered services, in exchange for a *92valuable consideration.” (emphasis added)).
In fact, consistent with this “usual meaning,” the word “purchase” is defined in BLACK’S LAW DICTIONARY 1234-35 (6th ed.1990) as the “[tjransmission of property ft'om one person to another by voluntary act and agreement, founded on a valuable consideration.... The term ‘purchase’ includes any contract to purchase, or otherwise acquire.” (Emphasis added.) Unlike the dictionary definition relied upon by the majority, this dictionary definition addresses both the “purchaser” and “seller” side of a purchase transaction and, in that regard, clearly envisions a direct transaction between the buyer and seller.

In Return for the Payment of Money

The same plain, ordinary, and usual meaning should be ascribed to section 407.637.1’s use of the phrase in return for the payment of money or other valuable consideration. The word “payment” is defined by BLACK’S LAW DICTIONARY 1129 (6th ed.1990) as:
[T]he performance of a duty, promise, or obligation, or discharge of a debt or liability, by the delivery of money or other value by a debtor to a creditor .... A discharge in money ... of an obligation or debt owing by one person to another, and is made by debtor’s delivery to creditor of money ... mid creditor’s receipt thereof.
(Emphasis added.) With respect to the latter portion of this definition, BLACK’S LAW DICTIONARY cites as authority Allmon v. Allmon, 306 S.W.2d 651, 655 (Mo.App.1957).
The phrase “in return” is defined within the definition of “return” by THE AMERICAN HERITAGE COLLEGE DICTIONARY 1167 (3rd ed.1993) as “in repayment or reciprocation.”
Affording these words their collective plain meaning, the phrase “in return for the payment of money” clearly envisions a direct transaction between the provider of goods or services and the recipient of those goods and services.
I would conclude, therefore, without resort to rules of statutory construction, that the word “buyer” and the phrase “in return for the payment of money or other valuable consideration,” when afforded their plain, ordinary, and usual meaning, reflect the legislature’s intent to include within the ambit of the Act customary purchase transactions occurring directly between the seller of a service and the buyer of the service. As a result, I conclude that Fugate’s allegations in her petition are facially insufficient to state a claim against Jackson Hewitt for violation of the Act.
If we presume, arguendo, that the word “purchase” and the phrase “in return for the payment of money or other valuable consideration” permit inconsistent, but equally plausible, interpretations, then section 407.637.1 would be rendered ambiguous. In such a case, rules of statutory construction would be employed to resolve the ambiguity. Maxwell, 190 S.W.3d at 610-11. These rules require us to construe section 407.637.1 in context and not in isolation. State ex rel. Lebeau, v. Kelly, 697 S.W.2d 312, 315 (Mo.App.1985). “[S]ections of the statutes in pan materia, as well as cognate sections, must be considered in order to arrive at the true meaning and scope of the words” employed by the legislature. State ex rel. Wright v. Carter, 319 S.W.2d 596, 600 (Mo. banc 1958). The purpose of an entire act must be considered. Neske v. City of St. Louis, 218 S.W.3d 417, 424 (Mo. banc 2007). It is a “fundamental rule of construction that one part of a statute should not be read in isolation from the context of *93the whole act.” Martinez v. State, 24 S.W.3d 10, 18 (Mo.App. E.D.2000). “Because a statute is passed as a whole and not in parts or sections and is animated by one general purpose and intent, each part should be construed in connection with other parts, and ‘it is not proper to confine interpretation to the one section to be construed.’ ” Id. (quoting Ferrell Mobile Homes, Inc. v. Holloway, 954 S.W.2d 712, 715 (Mo.App. S.D.1997)).
The majority opinion appears to have viewed section 407.637.1 in isolation, with the skewed impression that a determination first had to be made that section 407.637.1 was ambiguous before the rule of construction requiring a section to be read and construed as a part of an entire Act could be employed. I believe this to be an inaccurate application of the rules of statutory construction.
Even if section 407.637.1 is construed in isolation, the majority has neglected to construe the phrase “in return for the payment of money or other valuable consideration” in context. Section 407.637.1 begins: “[a] credit services organization is a person who, with respect to the extension of credit by others.” Fugate alleges in her petition that Jackson Hewitt obtained an extension of credit from SBBT for her. Fugate thus necessarily reads the aforementioned phrase as: “a credit services organization is a person who, with respect to the extension of credit by others for a buyer,” adding an unstated modifier.
Similarly, section 407.637.1 requires that a person who is alleged to be a credit services organization “provides or represents.” Fugate alleges that Jackson Hewitt is a credit services organization, and thus necessarily reads this phrase to mean that a credit services organization is a person who “provides or represents to a buyer,” again adding an unstated modifier.
Section 407.637.1 continues to require that a person who is alleged to be a credit services organization provides or represents “that the person can or will provide any of the following services.” Fugate alleges in her petition that the service provided by Jackson Hewitt was the service of obtaining an extension of credit for her, necessarily reading the aforesaid phrase to mean “that the person can or will provide any of the following services to a buyer,” an unstated modifier.
As to each of the aforesaid components of section 407.637.1 addressing the required predicate actions of a purported credit services organization, Fugate comfortably reads the predicate as limited by the unstated modifier “for or to a buyer.” The same logic must be applied to the predicate of payment. Thus, where section 407.637.1 requires a purported credit services organization’s action to have been undertaken “in return for the payment of money or other valuable consideration” the unstated modifier “from a buyer ” must be presumed at the end of phrase to be consistent. I would thus conclude, reading the phrase “in return for the payment of money or other valuable consideration” in context with the balance of section 407.637.1, that the legislature intended the scope of section 407.637.1 to be limited to transactions where a purported credit services organization affords a described service directly to a buyer in exchange for payment directly from the buyer for that service.
I reach the same conclusion reading section 407.637.1 in pari materia with other sections of the Act, as is required. Martinez, 24 S.W.3d at 18. Section 407.638 describes the prohibited activities of a credit services organization. As an example, section 407.638(1) provides that a credit services organization may not “[cjharge a buyer or receive from a buyer money or *94other valuable consideration before completing performance of all services the credit service organization has agreed to perform for the buyer ” absent posting a bond. (Emphasis added.) This prohibited activity is clearly expressed in terms requiring a credit services organization to charge a buyer directly, or to receive payment from a buyer directly, in exchange for performing an agreed service, referring necessarily to one of the three services described in section 407.637.1. Similarly, section 407.638(2) provides that a credit services organization cannot “[cjharge a buyer or receive from a buyer money or other valuable consideration solely for referral of the buyer to a retail seller who will or may extend credit to the buyer if the credit that is or will be extended to the buyer is substantially the same as that available to the general public.” (Emphasis added.) Once again, this prohibited activity speaks expressly of a scenario where the purported credit services organization directly charges a buyer, or receives payment directly from a buyer, for the provision of the specified service.
Reading section 407.637.1 in pari mate-ria with section 407.638, I conclude that the definition of “credit services organization” was intended by the legislature to be limited to transactions where a purported credit services organization provides one of the services described in section 407.637.1 directly for or to a buyer in exchange for payment directly from the buyer. In fact, to conclude otherwise would lead to an absurd result. If “credit services organization” is interpreted as suggested by the majority, then the class of persons included within the definition of “credit services organization” will be broader than the class of persons subject to the restrictions set forth in section 407.638. I do not believe the legislature intended such an incongruent result. It is a “vital canon of construction ... that an ambiguous statute will not be construed so as to work an unreasonable or absurd result.” State ex rel. Sch. Dist. of Kansas City v. Young, 519 S.W.2d 328, 333 (Mo.App.1975) (citing State ex rel. Dravo Corp. v. Spradling, 515 S.W.2d 512, 517 (Mo. banc 1974); (other citations omitted)).
Fugate argues that interpretation of section 407.637.1 must be controlled by section 407.637.2, which lists ten professions that are exempt from the Act. These include, among others, real estate brokers, lawyers, and stocks and commodities broker-dealers. Fugate argues that had the legislature intended to exempt tax preparers, then it would have listed tax preparers in section 407.637.2. The majority was persuaded by Fugate’s argument. The fallacy in Fugate’s argument, however, is that it presumes the definition of “credit services organization” applies to Jackson Hewitt as to require the need to resort to an exemption. I have already concluded that unless a tax preparer is paid directly by a taxpayer for the service of obtaining an RAL, then the tax preparer is not a credit services organization. It is axiomatic that Jackson Hewitt did not need to rely on an exemption to escape the application of the Act if the Act did not apply to its conduct in the first place.1 Fugate’s, and thus the majority’s, focus on who is (or is not) exempt from the Act puts the cart before the horse.
I acknowledge Fugate’s argument that the construction of section 407.637.1 to exclude transactions which indirectly result *95in a third person receiving money, as in this case, could permit credit services organizations to shield themselves from the Act by creating “straw parties” for the acceptance of payment. Though I am cognizant of this possibility, I note Fugate has not alleged that SBBT was a “straw party” for Jackson Hewitt, rendering Fugate’s policy argument inapplicable to the facts of this case. Moreover, a court faced with different allegations in a petition will remain free to determine that existing substantive principles of law could permit the conclusion that payment by a buyer to one entity is legally indistinguishable from payment by the buyer to the entity claimed as the credit services organization. Fugate’s petition, however, does not allege facts which would permit exploration of liability on such grounds. Nor is liability on such grounds argued by Fugate as a means of salvation for her petition.
Regardless of the merit, if any, in Fu-gate’s expressed concern, the fact remains that we are obligated to construe section 407.637.1 to ascertain legislative intent, even if that construction permits an undesirable or unintended consequence. Miles v. Lear Corp., 259 S.W.3d 64, 69 (Mo.App. E.D.2008) (“[U]nintended consequences are best resolved by the legislature, not the judiciary.”). The legislature remains free to amend section 407.637.1 if and as it sees fit to prevent the scenario about which Fugate expresses concern.
In light of the foregoing, I conclude that Fugate’s allegation that Jackson Hewitt was indirectly paid by her for obtaining an extension of credit was not sufficient to plead that Fugate was a “buyer” with respect to her relationship with Jackson Hewitt, or that Jackson Hewitt was a “credit services organization,” pursuant to the provisions of the Act. I believe the circuit court correctly dismissed Fugate’s petition and that Fugate’s first point should be denied.2 I would affirm the circuit court’s dismissal of Fugate’s petition for failing to state a claim under the Act. Consequently, I would also affirm the circuit court’s dismissal of Fugate’s Merchandising Practices Act claim, which was predicated upon her claim under the Act.
Fugate’s second point on appeal relates to whether she sufficiently pled an injury due to Jackson Hewitt’s noncompliance with the Act as to avoid dismissal of her petition. Because I conclude that the trial court otherwise correctly dismissed Fu-gate’s petition, I have not addressed Fu-gate’s second point.

. This is a case of first impression in Missouri. The parties have tendered competing authority from other jurisdictions construing similar statutes and addressing whether tax preparer RAL loans, and more specifically, indirect RAL transactions, were intended by that jurisdiction’s legislature to be included within the scope of the applicable statute. Based on these competing authorities, I could cite to nonbinding, but persuasive, authority for the positions advanced by both Fugate and Jackson Hewitt. The competing authorities, therefore, afford no meaningful guidance in construing our Act.