Case Summary for February 19, 2014

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Case Summary for February 19, 2014

THE FOLLOWING DOCKET SUMMARIES ARE PREPARED BY THE COURT'S STAFF FOR THE INTEREST AND CONVENIENCE OF THE READER. THE SUMMARIES MAY NOT INCLUDE ALL ISSUES PENDING BEFORE THE COURT AND DO NOT REFLECT ANY OPINION OF THE COURT ON THE MERITS OF A CASE. COPIES OF ALL BRIEFS FILED WITH THE COURT ARE AVAILABLE AT THE SUPREME COURT BUILDING, COURT EN BANC DIVISION. SUMMARIES ARE UNOFFICIAL AND SHOULD NOT BE QUOTED OR CITED.

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DOCKET SUMMARIES
SUPREME COURT OF MISSOURI

9:30 a.m. Wednesday, February 19, 2014

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SC93543
Brian Nail v. Husch Blackwell Sanders, LLP
Jackson County
Challenge to summary judgment on negligence claim

Listen to the oral argument:

Nail was represented during arguments by Timothy W. Monsees of Monsees & Mayer PC in Kansas City, and Husch Blackwell Sanders was repersented by R. Lawrence Ward of Polsinelli PC in Kansas City.

Brian Nail entered into stock option agreements with Richard Mueller in 1996 and again in 2000 wherein he obtained an interest to purchase several shares of his employer MTW Corporation’s stock. Nail entered an agreement terminating his employment with MTW in March 2001, which included a provision for Nail to exercise stock options within 18 months of his termination. Nail hired Husch Blackwell Sanders to advise him as to his stock option agreements. In July 2001 MTW merged with another company, The Innovation Group, which changed Nail’s stock options to Innovation Group options and as part of the merger agreement, froze sale of all stock for one year. Stock prices rose significantly in that year. Mueller agreed to allow Nail to exercise his options one year from the merger, but Mueller had to gain consent from Innovation Group before transferring any stock. Husch advised Nail that he was unlikely to prevail in a lawsuit against Mueller to enforce the options and recommended entering into a dispute settlement agreement instead, which Husch drafted. Following the agreement, Nail hired separate counsel and filed a lawsuit against Mueller for enforcement of the stock options and settlement agreement. The circuit court granted Mueller’s motion for summary judgment and found no material issues of fact indicating breach of contract. Nail then filed a claim of negligence against Husch for its advice in entering the settlement agreement, which prevented him from exercising his options while the stock prices had peaked. Husch filed a motion for summary judgment, which the circuit court granted. Nail appeals.

Nail argues the circuit court erred in granting summary judgment to Husch and overruling his motion for reconsideration. He contends Husch negligently advised him regarding the protection of his interest in a stock option agreement. Nail asserts the circuit court incorrectly found that Husch’s negligence did not cause his damages. He argues that Husch advised him to enter into a dispute settlement agreement, which delayed taking action on the stock while at its peak, and the stocks prices declined during that delay. Nail contends he did not waive his right to bring litigation against Mueller. He asserts his attempt to mitigate the damages by later filing a suit against Mueller shows he had no intent to relinquish his rights. Nail argues the damages should not be based on the amount specified in the liquidated damages clause of the settlement agreement. He contends there is a genuine issue of material fact regarding whether the damages were accurately estimated by the clause. Nail asserts the amount of damages against Husch is the same regardless of whether it was a result of a breach of the settlement or negligent drafting.

Husch responds the circuit court correctly granted summary judgment and overruled Nail’s motion for reconsideration. It argues that Nail could not prove essential elements of his negligence claim. Husch contends Nail failed to prove he suffered harm caused by Husch’s advice and failed to prove that the advice made a difference to the outcome. It asserts Nail cannot prove malpractice because his claim is based on fluctuations in the stock market, which cannot be attributed to Husch. Husch argues there is no evidence that Nail decided to settle based on Husch’s advice. It contends that Nail’s abandonment of his breach of contract claim against Mueller defeats any claim that Husch’s advice caused him harm. Husch asserts the circuit court correctly found that Nail’s claim for negligent drafting of the settlement agreement fails because there is no link between the alleged negligence and the damages.

The Missouri Organization of Defense Lawyers argues as a friend of the Court that the standard of causation for liability suits against attorneys should not be changed. It contends that currently plaintiffs filing for negligence against medical and financial professionals are correctly required to prove negligence under the same standard of causation as in a suit against an attorney. The organization asserts that allowing plaintiffs in legal negligence cases to prevail on a lesser standard would burden attorneys in a disproportionate manner. It also argues that plaintiffs in legal negligence cases should be required to provide expert testimony explaining the causation.

SC93451
Carla Baker v. Bristol Care, Inc., d/b/a Bristol Manor and David Furnell
Dekalb County
Motion to compel arbitration

Listen to the oral argument:

Bristol Manner and Furnell were represented during arguments by Brian N. Woolley of Lathrop & Gage LC in Kansas City, and Baker was repersented by Jayson A. Watkins of Brown & Associates LLC in Gower.

David Furnell is the president of Bristol Care Inc., which employed Carla Baker. Baker was promoted to administrator of Bristol’s Maysville facility and entrusted with responsibility for its daily operation. As part of her promotion Baker signed documents including a mandatory arbitration agreement and was given a higher salary with bonus option. Under the agreement Baker could only be terminated with five days prior notice or five days pay and all claims or controversies arising from employment were to be submitted to arbitration. Following her termination, Baker filed a lawsuit against Bristol Care and Furnell for unpaid wages and breach of contract. Bristol and Furnell filed a motion to stay the court proceeding and compel arbitration of the claims. The circuit court overruled the motion. Bristol and Furnell appeal.

Bristol and Furnell argue the circuit court erred in overruling their motion to stay the proceedings and compel arbitration. They contend the arbitration agreement is enforceable because it is part of a valid contract. Bristol and Furnell assert Baker’s claims for wages are within the scope of the arbitration agreement. They argue the arbitration agreement is not a contract of adhesion because it was not an unexpected surprise and does not limit their liability. Bristol and Furnell contend Baker voluntarily entered into this contract and accepted the included promotion. They assert the arbitration agreement is not an illusory contract because they are not permitted to change the contract without prior notice, the contract prohibits retroactive (applying to past actions) amendments and there is consideration for the arbitration agreement. Bristol and Furnell argue the arbitration agreement specifically applies to disputes between Baker and the company and its officers and an arbitrator should decide all questions regarding enforceability.

Baker responds the circuit court correctly overruled Bristol and Furnell’s motion to stay the proceedings and compel arbitration. She argues the arbitration agreement is unenforceable because employment, promotions and a new pay scale do not constitute consideration for a contract. Baker contends the right to amend the arbitration agreement renders it illusory and conflicts with her employment agreement. She asserts the circuit court correctly refused to compel arbitration because Furnell is not a covered entity in the arbitration agreement. Baker argues it is the court’s job to determine if a valid contract exists. She contends that without a valid contract the terms of the arbitration agreement are null and void.

SC93628
Cheikh Seck v. Department of Transportation, and Division of Employment Security
Jackson County
Challenge to denial of unemployment benefits

Listen to the oral argument:

Seck was represented during arguments by Kenneth Kinney of the University of Missouri Kansas City Appellate Practice Clinic in Kansas City, and the Department of Transportation and Division of Employment Security were repersented by Ninion S. Riley of Department of Labor in Jefferson City.

Cheikh Seck was an employee with the Missouri Department of Transportation, who was terminated September 8, 2011. While employed with the department Seck had missed several days of work due to injuries, which prevented him from working. He used personal sick days to cover the time and submitted a doctor’s note to the department upon his return August 8, 2011. Seck wanted to finish his medication before returning to work so he added an annotation to the note prior to submission reflecting that he would return August 8 after finishing the medicine. When the department inquired as to who had drafted the annotation, Seck confessed. He applied for unemployment benefits with the Division of Employment Security and was denied based on the department’s statement that he was terminated for misconduct in falsifying a doctor’s note. Seck filed for review with the division’s appellate board, which upheld the decision. He then filed for review with the Labor and Industrial Relations Commission, which also upheld the decision to deny benefits. Seck seeks review of the commission’s decision.

Seck argues the commission incorrectly determined he was not entitled to unemployment benefits. He contends the department failed to provide sufficient and competent evidence to prove he was terminated for misconduct. Seck asserts that his annotation on the doctor’s release form was not intended to mislead or deceive the department. He further argues that the annotation was a correct representation of the agreement with his supervisor and was not used to fraudulently obtain additional sick leave. Seck contends the department did not rely on his annotation and it did not materially affect his employment. He asserts the annotation was an innocent mistake reflecting his poor judgment.

The department responds that the commission correctly determined Seck was not entitled to unemployment benefits. It argues Seck committed misconduct by disregarding the appropriate standards of behavior for an employee. The department contends it had a right to expect Seck to conduct himself according to appropriate standards. It asserts Seck altered his doctor’s medical certification to extend his sick leave and conveyed it to the department as authentic.

SC93625
In re: Wesley Eugene Sanders
Christian County
Attorney discipline

Listen to the oral argument:

Disciplinary counsel was represented during arguments by Sam S. Phillips of the Office of Chief Disciplinary Counsel in Jefferson City, and Sanders was repersented by Thomas D. Carver of Carver, Cantin & Grantham in Springfield.

Nixa attorney Wesley Sanders submitted an attorney complaint against his ex-wife to the Office of Chief Disciplinary Counsel using his current wife’s maiden name with her consent. The disciplinary panel investigated the complaint and discovered it was actually submitted by Sanders. Sanders confessed and entered into a stipulation (agreement) with the Office of Chief Disciplinary Counsel as to the facts of the case, applicable law and recommended discipline. The panel found Sanders was guilty of violating the rules of professional conduct. Disciplinary counsel asks this Court to review and recommend discipline.

Disciplinary counsel and Sanders stipulate that Sanders violated two rules of professional conduct and should be disciplined. They contend Sanders submitted a complaint to the disciplinary authority using a false name. Disciplinary counsel and Sanders assert that this action violated rule 4-8.4(c) regarding conducting involving dishonesty, fraud, deceit or misrepresentation. They also stipulate that Sanders violated rule 4-8.1(a) regarding false statements of material fact, failing to disclose a fact or failing to respond to a request from a disciplinary authority. Disciplinary counsel and Sanders agree that reprimand is the appropriate sanction in this situation according to American Bar Association standards and precedent (prior case law).