Court Opinion

ID: 2754357
Source: CourtListenerOpinion
Date Created: 2014-11-21 22:05:12.115942+00
Date Added: 2024-06-11T12:11:04.610737
License: Public Domain

KEHRER BROTHERS CONSTRUCTION, INC., )
                                    )
            Plaintiff-Appellant,    )
                                    )
     vs.                            )                                No. SD33069
                                    )                                Filed: November 21, 2014
EDWIN J. GIRE, and                  )
BANK OF VERSAILLES, and             )
KENNETH L. MCCUTCHEON, JR., and     )
BUSEY BANK,                         )
                                    )
            Defendants-Respondents. )

                APPEAL FROM THE CIRCUIT COURT OF CAMDEN COUNTY

                             Honorable Kenneth M. Hayden, Circuit Judge

REVERSED AND REMANDED WITH DIRECTIONS

        Kehrer1 Brothers Construction, Inc. (“Kehrer Brothers”), appeals the judgment of the trial

court denying its petition to enforce a mechanic’s lien. Finding merit to one of Kehrer Brothers’

points, we reverse and remand with instructions.

1
 In the judgment and transcript, “Kehrer” is inadvertently misspelled as “Keher.” For purposes of this appeal, we
use the correct spelling of “Kehrer.”
                                     Facts and Procedural History
        In March 2006, Edwin J. Gire (“Gire”) executed two deeds of trust and two $200,000

promissory notes in favor of Busey Bank, an Illinois Banking Corporation, secured by the

following described real estate:

        All of Lot 9R of a subdivision of Lots 8, 9, and 10, amended plat to Harbor
        Heights Estates, a subdivision in Camden County, Missouri, according to the plat
        thereof on file and of record in the office of the Recorder of Deeds, Camden
        County, Missouri.

(“the property”).

        On October 26, 2007, Kehrer Brothers, as “Contractor,” entered into a “Subcontract

Agreement”2 with Gire, as “Subcontractor,” to perform excavating work for Gire at a “Job

Address” shown as “1171 Greenwood Circle[,] Osage Beach, MO 65065” (“jobsite”). There

was no real estate description set forth in the Subcontract Agreement for the jobsite address.

        On November 1, 2007, Kehrer Brothers began the excavation work and supplied the

materials and machinery used in the excavation. The last work performed by Kehrer Brothers at

the jobsite was on August 15, 2010.                At that time, Kehrer Brothers claimed the sum of

$480,637.50 was still due and unpaid by Gire.

        On April 21, 2009, Busey Bank, by the terms of a subordination agreement, subordinated

its two deeds of trust and promissory notes—secured by the property—to the Bank of Versailles.

Thereafter, on April 30, 2009, the Bank of Versailles became the holder of a promissory note in

the original principal amount of $1,650,000, and a deed of trust secured by the property, both

executed by Gire.

2
  Joseph Kehrer testified that Kehrer Brothers had not changed their contract form since 1988 when they first started
business and that is why the written agreement between Kehrer Brothers and Gire was a “Subcontract Agreement.”
Most of Kehrer Brothers’ work was subcontracting work rather than general contracting. The header at the top of
the Subcontract Agreement shows Kehrer Brothers’ name, address and phone number.

                                                         2
           On November 10, 2010, Kenneth L. McCutcheon, Jr. (“McCutcheon”), in his capacity as

trustee under the Gire deed of trust, foreclosed on the Gire promissory note and deed of trust on

behalf of the Bank of Versailles. Thereafter, on November 12, 2010, a trustee’s deed on the

property was recorded on behalf of the Bank of Versailles.

           On February 14, 2011, Kehrer Brothers filed its “Statement of Mechanic’s Lien”

(“mechanic’s lien”) with the Circuit Clerk of Camden County.

           In the mechanic’s lien, Kehrer Brothers claimed a lien

           for work and labor performed and materials and services furnished by it under
           contract and/or pursuant to a continuous running account with Edwin J. Gire,
           upon and for the building and improvements in Camden County and described as
           follows:

                    All of Lot 9R of A SUBDIVISION OF LOTS 8, 9, AND 10,
                    AMENDED PLAT TO HARBOUR [sic] HEIGHTS ESTATES, a
                    subdivision in Camden County, Missouri, according to the Plat
                    thereof on file and of record in the Office of the Recorder of
                    Deeds, Camden County, Missouri.

                    Together with a 2 well encapsulated steel and concrete dock.

                    Subject to all restrictions, reservations and easements of record.

                   Together with all improvements thereon. Said real estate, buildings and
           improvements belonging to and being owned by Edwin J. Gire at the time the
           contract was entered into, at the time said work and labor were performed and the
           materials were furnished, and subsequently acquired by the Bank of Versailles
           through the foreclosure of its Deed of Trust on November 10, 2010, and,
           therefore, the owner of said real estate at the time of the filing of this statement of
           Mechanics [sic] Lien.

           The mechanic’s lien also contained an “Amended Notice of Rights (Pursuant to Section

429.016)”3 directed to the Bank of Versailles as the ‘“Grantor’ (Property Owner/s)” of the

‘“Property’ Address” at 1171 Greenwood Circle, Osage Beach, Missouri 65065, and included

the aforementioned legal description of the property.

3
    All references to statutes are to RSMo 2000, unless otherwise indicated.
                                                            3
       On May 17, 2011, Kehrer Brothers filed its original petition for enforcement of its

mechanic’s lien, which was amended on June 13, 2012. The First Amended Petition consisted of

two counts: “Count I Suit for Enforcement of Mechanic’s Lien” requested judgment against

Gire in the amount of $480,637.50, as well as a judgment against the Bank of Versailles

declaring Kehrer Brothers’ mechanic’s lien superior to that of the bank, that the bank’s

foreclosure and acquisition of ownership of the property be subject to the Kehrer Brothers’

mechanic’s lien, and that if sufficient property of Gire could not be found to satisfy the

judgment, that Kehrer Brothers have special execution against any “building, appurtenances,

improvements and land above described to satisfy said judgment”; and “Count II Declaratory

Judgment,” declaring Busey Bank had no interest or lien, by way of its two prior promissory

notes and deeds of trust, in and to the property.

       A bench trial was held on May 20, 2013. Kehrer Brothers appeared by counsel, and

McCutcheon appeared as counsel for Bank of Versailles and representing himself as trustee.

Gire appeared without counsel. No appearance was made on behalf of Busey Bank. The parties

stipulated that the Subcontract Agreement between Kehrer Brothers and Gire was a construction

contract.

       Joseph Kehrer testified on behalf of Kehrer Brothers and a portion of his testimony was

directed to the address of the property:

             Q     And was the address of this -- of Ed Gire’s property 1171
       Greenwood Circle, Osage Beach, Missouri?

               A       I couldn’t say for sure that’s the address.

               ....

               Q      Let me have, if I could, Exhibit 2 again. And on page 5 of 26 of
       Plaintiff’s Exhibit 2, what you call the summary statement, there’s no customer
       name on that page, is there?
                                                    4
               A      No.

               Q       And there’s not any address for the customer on that page 5 of 26
       of Plaintiff’s Exhibit 2?

               A      No.

               ....

              Q       Would it be true that Edwin J. Gire was building a residential
       house on the land that Keher[sic] Brothers Construction, Inc. worked on?

              A       I wouldn’t think it would be considered residential, but yeah, he
       was building a place on his land. I assume it was his land.

       Gire testified on behalf of Kehrer Brothers. He stated that he was “the former owner of

the property at 1171 Greenwood Circle” in Osage Beach, and in 2007, he decided to add an

addition to the existing house on that property and asked Kehrer Brothers to assist with the

excavation work for that addition. Gire identified the Subcontract Agreement as the agreement

he signed with Kehrer Brothers. Gire, a general contractor himself, was periodically at the

jobsite overseeing the project. Gire testified that the 1171 Greenwood Circle property was zoned

for residential use and that in November 2007, there was an existing house on that land.

       Kehrer Brothers then rested, at which time McCutcheon announced that neither he, nor

the Bank of Versailles, had evidence to present. Both sides presented closing arguments to the

trial court. McCutcheon argued that Kehrer Brothers failed to prove the work it performed for

Gire at the jobsite address was the same real estate described by the legal description in its

mechanic’s lien. It was argued that Kehrer Brothers did not put a deed into evidence that would

have proven that the jobsite address and the real estate described in the mechanic’s lien were one

and the same property and was owned by Gire.

       McCutcheon argued several times that in order for Kehrer Brothers to prove they were

entitled to a mechanic’s lien, Kehrer Brothers was required to put the deed to the property into
                                                5
evidence and the absence of that proof required the trial court to rule against them. Thereafter,

the following exchange occurred:

                [KEHRER BROTHERS’ COUNSEL]: Your Honor, I don’t want to get
        hung -- if the Court would permit to reopen the evidence for submission of the
        deed, we’d certainly be willing to do that. I don’t want to have the Court hung up
        on this. I do think that the lien and the contract are enough, along with the
        testimony, and I don’t think there’s been any dispute that Mr. Gire is the owner of
        that property.

               THE COURT: I don’t think there was any dispute he owned the property
        located at whatever that address is, 1171[]Greenwood Circle. We just don’t know
        what 1171 Greenwood Circle is.

                [MCCUTCHEON]: We’d object to any reopening of the case.

                THE COURT: I’m not going to allow us to reopen.

The trial court then announced it was taking the matter under advisement and gave each party ten

days to submit trial briefs.

        On August 28, 2014, the trial court entered its “Judgment, Entry and Order.” The trial

court found:

        2.      It is further alleged in the First Amended Petition that [Gire] was the
                owner of the afore described real estate at the time he entered into a time
                and materials contract to perform certain earth moving and excavating
                activities on the afore described real estate with [Kehrer Brothers].
                [Kehrer Brothers] bears the burden of proving compliance with the
                essential elements of the applicable statutes in order to be entitled to a
                Mechanic’s Lien. In the case at bar, Plaintiff therefore is required to
                establish that [Gire] was the owner of the afore described real estate and
                that [Kehrer Brothers’] work, labor, materials and services were furnished
                for improvements on the afore described real estate.

                                                 6
       3.     [Kehrer Brothers] offered evidence at trial that [Gire] owned a residence
              located at 1171 Greenwood Circle, Osage Beach, Missouri. [Kehrer
              Brothers] did not offer any evidence at trial that [Gire] was the owner of
              [the real estate described in the Mechanic’s Lien Statement]. The only
              evidence offered at trial that ties the residence located a[t] 1171
              Greenwood Circle, Osage Beach, Missouri to the afore described real
              estate was the lien statement admitted at trial as Plaintiff’s Exhibit 2.
              Although admitted at trial to establish the statutory requirements of
              Section 429.080 had been complied with by [Kehrer Brothers], [Kehrer
              Brothers], nevertheless, bears the burden of proving evidence which
              proves that the contents of its Mechanic’s Lien Statement are true. If this
              were not the case, the Mechanic’s Lien Statement would be self-proving
              and there would be no need for a trial.

       4.     Therefore the Mechanic’s Lien Statement admitted by this [c]ourt as
              Exhibit 2 in and of itself is not evidence that [Gire] owned the real estate
              [described in the Mechanic’s Lien Statement]. Neither is the Mechanic’s
              Lien Statement itself evidence that [Kehrer Brothers’] work, labor,
              materials and services were furnished for improvements on the afore
              described lands. Therefore as to Separate Defendants Bank of Versailles
              and [McCutcheon], [Kehrer Brothers] has failed to prove the essential
              elements required for the establishment of a Mechanic’s Lien as to those
              two Separate Defendants.

       The trial court entered judgment on Count I in favor of the Bank of Versailles and

McCutcheon, and a judgment in favor of Kehrer Brothers against Gire in the amount of

$480,637.50. In Count II, the trial court declared Busey Bank had no interest in or lien upon the

property.

       On September 26, 2013, Kehrer Brothers filed its “Motion to Amend or Modify the

Judgment or, in the Alternative, for a New Trial” as to enforcement of its mechanic’s lien. That

motion was denied by the trial court on November 22, 2013. This appeal followed.

       On appeal, Kehrer Brothers presents two points. In its second point, Kehrer Brothers

contends that the trial court erred in failing to reopen the evidence to allow Kehrer Brothers to

introduce further evidence that Kehrer Brothers performed work at the property described in the

mechanic’s lien. We agree.

                                               7
                                     Standard of Review

       We review a trial court’s decision on a request to reopen evidence for abuse of discretion.

In re Marriage of Parmenter, 81 S.W.3d 234, 240 (Mo.App. S.D. 2002). “[T]o demonstrate an

abuse of discretion, the complaining party must show the trial court’s decision was against the

logic of the circumstances and so arbitrary and unreasonable as to shock one’s sense of justice.”

Howard v. City of Kansas City, 332 S.W.3d 772, 792 (Mo. banc 2011).

       A circuit court has broad discretion in deciding whether to admit or exclude evidence,

and we accord the ruling substantial deference and presume it to be correct. KC Excavating and

Grading, Inc. v. Crane Constr. Co., 141 S.W.3d 401, 407 (Mo.App. W.D. 2004). “It is the

appellant’s burden to persuade us that the circuit court abused its discretion and that the abuse

resulted in prejudice. Even an erroneous evidentiary ruling will not warrant a reversal in the

absence of prejudice.” Id. at 408 (internal citation omitted). “We recognize that ordinarily when

there is no inconvenience to the court nor unfair advantage to one of the parties it would be an

abuse of discretion upon the refusal to permit the introduction of material evidence which might

substantially affect the merits of the case.” Matter of Viviano’s Estate, 624 S.W.2d 130, 133

(Mo.App. E.D. 1981) (citing Pride v. Lamberg, 366 S.W.2d 441 (Mo. banc 1963)); see also In

re Estate of Mapes, 738 S.W.2d 853, 856 (Mo. banc 1987) (remanding for new trial where the

trial court refused to reopen the case so that a party could present “clearly material and possibly

outcome determinative” evidence).

                                            Analysis

       The trial court abused its discretion in refusing to reopen the evidence. Mapes, 738
S.W.2d at 856. “Pride and its progeny have repeatedly stated the principle that if the court is not

inconvenienced and there is no unfair advantage, then it is an abuse of discretion to refuse to

                                                8
reopen to receive evidence that is material and possibly outcome determinative.” LaFevers v.

Clothiaux, 403 S.W.3d 653, 658 (Mo.App. S.D. 2012) (bold emphasis added).

       In Mapes, the heirs at law and residuary legatees of a will brought an action to discover

estate assets alleging that joint deposits in the name of decedent, decedent’s attorney and

attorney’s brother were the product of fraud and undue influence. Id. at 854. At the close of

plaintiffs’ case, the trial court granted a request for directed verdict in favor of defendants,

concluding that plaintiffs failed to meet their burden of proving fraud or undue influence, and

that they failed to establish that the transfer to attorney and his brother was made during the

course of the attorney-client relationship between attorney and decedent. Id. During argument

on the motion to direct a verdict in favor of defendants, plaintiffs requested leave to reopen their

case, seeking to introduce defendants’ answers to interrogatories and to call defendant-attorney

to the witness stand to show the existence of an attorney-client relationship at the time the joint

accounts were created. Id. The trial court denied plaintiffs’ request. Id.

       On transfer, our Supreme Court held:

                Under the holding in Pride, plaintiffs should have been permitted the
       opportunity to reopen their case at trial. Plaintiffs sought to examine defendant
       [attorney] and admit his answers to interrogatories for the purpose of establishing
       that an attorney-client relationship existed between [decedent] and [attorney] at
       the time the joint deposits were created. By establishing this fact, the plaintiffs
       could have avoided a directed verdict. Thus, the evidence which they sought to
       present was clearly material and possibly outcome determinative. Furthermore,
       granting leave to reopen would not have inconvenienced the court or prejudiced
       the defendants given the fact that the request was made prior to the granting of a
       directed verdict, and, at a time when the jury and witnesses were readily available.
       If a plaintiff, by mistake or inadvertence, fails to produce sufficient evidence at
       trial to prove his claim, in a situation where the proof seems to be available, the
       case should be remanded to permit the introduction of additional evidence.

                                                 9
               Here, plaintiffs mistakenly believed that the trial court would recognize a
       presumption of fraud and undue influence which would allow them to take their
       case to the jury. As a result they earlier failed to call and examine defendant
       [attorney] or introduce his answers to interrogatories. Plaintiffs should be given
       an opportunity to present such evidence at trial.

Id. at 855-56 (internal citations omitted).

       Kehrer Brothers was required to put on proof of “a true description of the property, or so

near as to identify the same” under section 429.080. In its judgment, the trial court premised its

decision to deny Kehrer Brothers’ request to enforce its mechanic’s lien on the fact that Kehrer

Brothers failed to provide a true legal description of the property under section 429.080, and that

the address in evidence and the legal description were the same property owned by Gire at the

time the work was done.

       As the trial court noted, Kehrer Brothers did put on evidence that Gire “owned a

residence located at 1171 Greenwood Circle, Osage Beach, Missouri.” Kehrer Brothers, as is

evident from the transcript, apparently believed that this evidence, combined with the statement

of mechanic’s lien, was sufficient to meet its burden under section 429.080. To the extent that

the trial court believed that this evidence was insufficient, it should have granted Kehrer

Brothers’ request to reopen the evidence.

       This additional evidence relating to the property description under section 429.080 was

clearly material, as was directly alluded to by McCutcheon, and as reflected by the trial court’s

reliance on the absence of such evidence in rendering judgment in favor of McCutcheon and the

Bank of Versailles. Further, granting leave to reopen would not have inconvenienced the trial

court or prejudiced McCutcheon and Bank of Versailles as the request to reopen was made prior

to the entry of judgment, witnesses would still have been available to both parties, and

                                                10
McCutcheon and the Bank of Versailles would have had the opportunity to put on their own

evidence in response after the evidence was reopened.

        It was further evident that the evidence was readily available. As counsel for Kehrer

Brothers explicitly stated: “Your Honor, I don’t want to get hung -- if the Court would permit to

reopen the evidence for submission of the deed, we’d certainly be willing to do that. I don’t

want to have the Court hung up on this.”4

        Further, we are also struck by the minimal consideration given by the trial court to Kehrer

Brothers’ request to reopen in order to present material and possibly outcome-determinative

evidence. After counsel for Kehrer Brothers requested the evidence be reopened, the trial court,

without the benefit of argument, research, or briefing, abruptly ruled that it would not reopen the

evidence.

        Under these facts, it was an abuse of discretion for the trial court to refuse to reopen the

evidence to allow Kehrer Brothers to present evidence of the property description pursuant to

section 429.080.

        By our decision, we express no opinion as to whether admission of the deed, or further

evidence concerning the property, satisfies Kehrer Brothers’ burden of proof as to its mechanic’s

lien. Likewise, our decision is not to be read to require that a deed to real property is always

required as a part of proof in a mechanic’s lien claim. Our decision is limited to the record

before us here.

        This matter is remanded with instructions that the trial court reopen the evidence to

permit Kehrer Brothers to introduce further evidence establishing that Kehrer Brother’s work

4
  Additionally, as was discussed in oral arguments, the Camden County recorder’s office was in the same building as
the courtroom where these arguments were taking place.
                                                        11
was performed at the real property described in the lien statement and for any other proceedings

consistent with this opinion.

WILLIAM W. FRANCIS, JR., C.J./P.J. - OPINION AUTHOR

JEFFREY W. BATES, J. - Concur

DANIEL E. SCOTT, J. - Concur

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