Case Summary for May 25, 1999

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Case Summary for May 25, 1999

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.

DOCKET SUMMARIES
SUPREME COURT OF MISSOURI
Tuesday, May 25, 1999

81456
66, Inc. v. Crestwood Commons Redevelopment Corporation, et al.
St. Louis County
Action on abandonment of condemnation

Hycel Partners III, L.P. and Schnuck Markets, Inc. formed a general partnership, the Crestwood Commons Joint Venture. The joint venture formed the Crestwood Commons Redevelopment Corporation under chapter 353. The redevelopment corporation sought to condemn 66 Drive-In, Inc.'s property. The commissioners entered their report on the property's value. The redevelopment corporation then abandoned the condemnation pursuant to section 523.040. The court awarded 66 interest on the commissioner's award under section 523.045, which 66 has been unable to collect.

66 filed this action, claiming damages from the abandonment and seeking to impose liability on the joint venturers. The court granted defendants summary judgment. 66 appeals.

66 argues it can maintain this action because Missouri law recognizes a tort cause of action in favor of a property owner and against a non-governmental condemnor for damages from abandoning a condemnation. Section 523.045, which permits the interest assessment, supplements rather than supplants the common law.

66 further argues the corporation's separate existence from the joint venturers should be disregarded, permitting the claim to be asserted directly against those who owned and controlled the condemnation. The redevelopment corporation was the alter ego of the joint venture, which completely dominated the corporation's finances and operations. The joint venture caused the corporation's incorporation, owned its stock, financed its activities and salaries (as the corporation had no capital or assets), shared its directors and officers, and controlled it. Hycel and Scnuck's domination violated the corporation's legal duties to 66.

Finally, 66 contends this action is not barred by a prior action. It is a tort action, whereas other actions sought to collect a debt (the interest judgment) by (a) asserting a claim as a third-party beneficiary under a contractual guarantee and (b) asserting an equitable creditor's bill.

Respondents counter that Missouri law does not recognize a tort for condemnation abandonment. Section 523.045's interest award is 66's exclusive remedy.

Respondents also contend the corporation's corporate veil should not be pierced to allow collection of the interest judgment against respondents. The corporation was created under chapter 353, and it was used for a proper purpose. The joint venturers controlled the corporation, but other factors needed to pierce the veil were not met. That is, the corporation was not used to perpetrate a fraud and was capitalized at industry standards. It had sufficient assets in the way of contingency funding to acquire and develop the project.

Lastly, Respondents argue the prior adverse judgment bars 66's claim. Despite the legal theories, both actions attempt to impose liability on all defendants based on the corporation's abandoning the condemnation. Although the prior action named different defendants, these defendants are in privity with them.

80075
In re Randall K. Wood
Disciplinary action
Failure to pay taxes--crime of moral turpitude

Attorney Randall Wood filed his income tax returns but failed to pay his full tax obligations.

The Chief Disciplinary Counsel argues Wood should be disciplined under Rule 5.21 for criminal conduct involving moral turpitude because (1) he pled guilty to the misdemeanor of willfully failing to pay his 1991 federal taxes; (2) failure to pay taxes involves moral turpitude; and (3) he chose to spend his income --buying investment property-- rather than pay taxes.

The CDC requests suspension as the Court has consistently suspended lawyers found guilty of tax offenses; aggravating circumstances are present; and American Bar Association standards indicate suspension.

Wood contends the information should be dismissed because a misdemeanor conviction for failure to pay taxes, alone, is not a crime of moral turpitude. It is not a vile, base or depraved act. He did file his tax returns but preferred other creditors, eventually paying his tax delinquency plus penalties and interest. In any event, if it is a crime of moral turpitude, the appropriate sanction would be a public reprimand.

81416
State of Missouri v. Dennis M. Burns
Buchanan County
Delivery of a controlled substance; dismissed

Dennis Burns was charged with one felony count of delivery of cocaine, a controlled substance. The prosecutor agreed to produce a confidential informant for an interview before trial, but the informant had moved and was not provided by the trial date. The trial court dismissed the case.

The state argues Burns was not entitled to dismissal. There were more appropriate remedies, such as a continuance or exclusion of the evidence. No rule or order required the prosecutor to make the witness available, and the court made no finding that the prosecutor acted in bad faith or that the witness was attempting to avoid talking to Burns' attorney.

Burns counters that the prosecutor agreed to make the witness available and the court entered an order that all disclosure was to be made by a certain date. When the prosecutor failed to produce the witness, the court simply dismissed the case without prejudice anticipating the state would refile after the witness had been made available. Also, this court has no jurisdiction because a dismissal is not a final, appealable judgment under Rule 30.01 or an interlocutory appeal under Rule 30.02 or section 547.200. The appeal is also untimely.

81408
Donald R. Martin v. United States Fidelity and Guaranty Company
Cooper County
Insurance coverage

Plaintiff Donald Martin was employed by the City of Boonville, Waste Water Treatment Plant when he was injured by explosion of a joint pipe flange assembly. He sued Melvan Cauthon, the Chief Operator of the plant for negligence. Cauthon requested defense and indemnity from Boonville's insurer, United States Fidelity & Guaranty Company. The insurance company covers its insured's “executive officers.” The insurance company denied coverage. The court found in the insurer’s favor.

Martin argues: (1) Cauthon was an "executive officer" of Boonville and, thus, covered by the policy. He actively participated in the control, supervision and management of the plant. And any ambiguity is construed in his favor. (2) Cauthon was acting within his duties as an executive officer in controlling, supervising, managing and designing the joint pipe flange assembly. (3) The insurance company cannot deny coverage on the basis that Cauthon is not an executive officer because it did not state this basis in its denial of coverage letter.

(4) A rider with a $100,000 per person coverage limit is not part of the insurance contract. The plaintiff's exhibit of the policy does not include it, and the policy's declaration page does not list it. In any event, the limit does not apply to Cauthon as an individual. The denial of coverage letter did not mention this limit.

(5) The trial court should not have dismissed the action on the basis that Cauthon was not acting in his supervisory capacity. The test is whether Cauthon was engaged in active negligence, not his status. (6) The insurance company knew more than the facts in Martin's petition when it was asked to defend Cauthon, such as Cauthon's employment status. The insurance company had the burden of proving non-coverage when relying on an exclusion in the contract to deny coverage.

The insurance company argues: (1) The insurance contract is unambiguous. Substantial evidence showed Cauthon was not an executive officer, and therefore the policy does not cover him. (2) Cauthon was not acting within an executive officer's duties. The petition alleged only that Cauthon personally and negligently installed the joint pipe flange assembly--not that he negligently designed or supervised the installation, a prerequisite to coverage. (3) The insurance company is not estopped from denying liability on the basis that Cauthon is not an executive officer. Waiver and estoppel were not pled, and coverage cannot be created by these doctrines. Cauthon demonstrated no detrimental reliance.

(4) The coverage limit is $100,000 per person. The rider is clear. It was in other exhibits. Waiver and estoppel were not plead and cannot create coverage. Cauthon demonstrated no detrimental reliance.

(5) The court could rely on an earlier ruling. Regardless, it is not necessary to resolve that issue. (6) The insurance company can make its decision about whether to grant or deny coverage based on the facts alleged in the underlying petition. Martin bore the burden to establish Cauthon came within the policy's coverage. Substantial evidence showed Cauthon was a co-employee of Martin, precluding coverage under the policy.

80931
State of Missouri v. Walter Barton
Henry, Cooper, Christian, and Benton Counties
First degree murder; death

Walter Barton repeatedly stabbed, slashed, beat, and sexually molested 81-year-old Gladys Kuehler. After two mistrials and a trial that resulted in a reversed conviction due to improper restrictions on defense argument, a jury found Barton guilty of first-degree murder and recommended the death sentence, which the court imposed. Barton appeals.

Barton argues: (1) The trial court should have allowed Barton to ask prospective jurors who had heard about his case specific voir dire questions, such as whether they had read about the case in a newspaper or heard it on the radio. Without the questions, Barton could not determine whether they could be fair, impartial, and unbiased.

(2) The trial court should have granted Barton's requests for a continuance and change of venue due to pre-trial publicity. A substantial number of venirepersons had already heard about the case, formed an opinion, and discussed the case. The trial court would not allow specific or individualized questioning to explore the source and content of each person's knowledge. (3) The trial court should have excluded an inmate's testimony that he heard Barton say Barton was going to have another inmate killed because the inmate repeated Barton's admission that Barton killed Kuehler. The testimony is irrelevant and improper evidence of an uncharged crime or bad act. The statement's prejudicial effect outweighs its probative value. (4) The state's argument in the penalty phase that "every legal nicety" had been observed demeaned Barton's right to due process and a fair trial. (5) This Court should re-sentence Barton to life in prison because the death sentence is excessive or disproportionate to the penalty in similar cases considering the crime, strength of the evidence, and defendant.

The state contends: (1) The court permitted ample questioning in small groups as to whether potential jurors considered their sources of information reliable, had formed opinions, and could judge fairly and impartially. Each who became part of the jury indicated he/she could.

(2) No continuance or change of venue was needed. The issue is not whether there was publicity or the jurors remembered the publicity or crime, but rather it is whether the jurors had such fixed opinions that they could not impartially judge. Barton failed to show that the county's residents were so prejudiced he could not get a fair trial. (3) The inmate's retaliation testimony was admissible. It showed Barton's consciousness of guilt. (4) Pointing out that legal niceties were observed did not demean Barton's rights. The prosecutor specifically explained he did not intend to demean but, rather, to describe the process, that the law had been observed, and that Barton had a fair trial. (5) The death sentence was not imposed under passion, prejudice, or other arbitrary factor. The evidence supports the aggravating circumstances the jury found. The sentence is not excessive or disproportionate, especially given the specific and numerous slashing, the injuries inflicted, and other gruesome details.