City of Branson v. Branson Hills Master

• Decision Date: 05 August 2009
• Docket Number: No. SD 29577.,SD 29577.
• Citation: 292 S.W.3d 467
• Parties: CITY OF BRANSON, Missouri, Plaintiff/Respondent v. BRANSON HILLS MASTER ASSOCIATION, INC., and Grant General Contractors, Inc., Defendants/Co-Respondents and Jista, Inc., Defendant/Appellant.
• Court: Missouri Court of Appeals

292 S.W.3d 467

CITY OF BRANSON, Missouri, Plaintiff/Respondent v. BRANSON HILLS MASTER ASSOCIATION, INC., and Grant General Contractors, Inc., Defendants/Co-Respondents and Jista, Inc., Defendant/Appellant.

No. SD 29577.

Missouri Court of Appeals, Southern District, Division Two.

August 5, 2009.

John E. Price, Carnahan, Evans, Cantwell & Brown, P.C., Springfield, MO, for Appellant.

Joseph A. Bohrer, Mark C. Fels, Yates, Mauck, Bohrer, Elliff & Fels, P.C., Springfield, MO, Anthony J. Soukenik, Sandberg, Phoenix & Von Gontard, P.C., St. Louis, MO, for Respondent Grant General Contractors.

JOHN E. PARRISH, Judge.

The City of Branson, Missouri, exercised its eminent domain authority by condemning a parcel of land in Branson Hills, a development in Taney County, Missouri, owned by Grant General Contractors, Inc. (Grant). An order of condemnation was entered appointing commissioners to assess damages as prescribed by Rule 86.06. The Commissioners' Report was filed, after which exceptions were filed by the city and by JISTA, Inc. (JISTA). See Rule 86.08.

The amount of the commissioners' award was paid into the registry of the court. Grant, alleging its group was owner in fee simple of the property being condemned, sought distribution of the commissioners' award. JISTA claimed an interest in the property by reason of a June 1992 contract (described as the "Master Infrastructure Contract") with Branson Hills Associates, L.P., (BHA), a prior owner of the condemned property, for work done pursuant to that contract, and thereafter filed a motion for allocation of the condemnation proceeds.¹

The trial court, following a hearing on JISTA's motion to allocate the proceeds awarded by the commissioners, entered the following Judgment.

NOW on this 29th day of Jan, 2008, the Court having heard the evidence, and the parties having submitted their suggestions and proposed findings of fact and conclusions of law determines that the Commissioners' award paid into the registry of the court, in the amount of $4,234,340.00, plus such interest as shall have accrued thereon, is hereby awarded, apportioned and set aside to Grant General Contractors, Inc. No portion of the Commissioners' award is awarded to JISTA, Inc. The Court adopts its findings of fact and conclusions of law previously filed herein. The costs of this action are taxed against JISTA, Inc.

Date: Jan 29, 2008

                /s/ T.B. Scott
                Theodore B. Scott, Circuit Judge
                

JISTA appeals. This court affirms.

Grant's Ownership of Branson Hills Property

The property now owned by Grant was part of a real estate development undertaken by BHA. BHA conveyed the property that is the subject of this appeal, "Parcel 12," to Wave Crest Properties, Inc., (Wave Crest), a California corporation, by warranty deed dated March 8, 1993. The deed was recorded March 16, 1993, in the Taney County, Missouri, deed records, Book 319, Pages 1486-89. Wave Crest conveyed the property to Grant by warranty deed that bears the "FILED" stamp of the Taney County Recorder's office dated November 12, 1993, and bears the certificate of the Taney County Recorder stating it was "duly filed for record" on November 19, 1993, in the Taney County, Missouri, deed records at Book 322, Pages 8369-71.

JISTA's Involvement in Branson Hills

JISTA's claim for condemnation proceeds is based on a business relationship with BHA. Its dealings with BHA are chronicled in considerable detail in Branson Hills Associates, L.P. v. JISTA, Inc., 932 S.W.2d 406 (Mo.App.1995). That opinion may be read for factual background regarding JISTA's claim that it is entitled to an apportionment of the proceeds from the condemnation action that is the basis of this appeal. Facts regarding the business relationship between BHA and JISTA recited herein are, in some instances, derived from the facts stated in that opinion without further attribution.

JISTA is in the construction business. Its involvement with BHA in the Branson Hills development was based on a series of contracts, the first of which is dated June 30, 1992. The June 30, 1992, contract is entitled Master Infrastructure Contract. It provided that BHA would execute "a [u]niversally [s]ubordinated [d]eed of [t]rust" to secure work performed by JISTA. The contract states in its Paragraph IIC:

(a) BHA shall execute and deliver to JISTA, before any work begins, a "DEED OF TRUST SECURING FUTURE ADVANCES" in the form specified in [an exhibit to the contract]. Said Deed of Trust shall convey a "universally subordinated" security interest in ... approximately 994 acres [described with particularity in an exhibit to the contract]. ...

. . .

(d) In this context, "universally subordinated" shall mean that the Deed of Trust is automatically subordinated to any and all other Deed(s) of Trust delivered and/or filed before or after it. However, the Deed of Trust referred to in [the subparagraph (a) above quoted] shall not be subordinated to any Deed of Trust which by itself or in aggregate with other Deeds of Trust secures indebtedness in excess of $4,000,000.00 on real property subject to the Deed of Trust. This limit may be extended by mutual agreement of the parties hereto.

The contract also states:

II. SECURITY

A. The parties will establish a procedure as defined hereinbelow for the purpose of securing BHA's payment to JISTA of the charges for the work JISTA is to do.

B. Deeds in escrow:

(a) From time to time and at its own discretion, with five (5) business days' notice to JISTA, BHA may deliver into escrow, its Warranty Deed(s) in the form represented by [an exhibit to the contract]. JISTA shall be the Grantee. Coincidentally, BHA shall deliver to JISTA an "AFFIDAVIT OF RECORD" in the form represented by [an exhibit to the contract], and a commitment to issue title insurance by an ALTA title insurance company in an amount equal to the "credit value" specified on [an exhibit to the contract] for the Parcel as to which the Deed(s) is (are) being delivered. ... [Emphasis added.]

(b) At the time of the delivery of the above-mentioned Warranty Deed(s) into escrow by BHA, JISTA shall deliver into escrow its Quit Claim Deed(s) conveying each of the same Parcels as is (are) conveyed by the Warranty Deed(s), in the form represented by [an exhibit to the contract]. BHA shall be the Grantee.

. . .

(d) When any Parcel is subject to a Deeds [sic] in escrow, pursuant to this agreement, JISTA may record in the land records of Taney County, Missouri, an "AFFIDAVIT OF RECORD" in the form represented by [an exhibit to the contract], describing said Parcel(s). No other documents shall be recorded by either party evidencing any portion of this agreement, except the Universally Subordinated Deed of Trust and a Notice of Assignment under Section VI.

On November 3, 1993, the same date that Grant acquired the property in question from Wave Crest, an "Affidavit of Record" was executed on behalf of JISTA that claimed a security interest in the property that is the subject of this appeal. It was not recorded in the Taney County, Missouri, deed records until November 19, 1993.

Appellate Review

This court's review of a judgment allocating damage assessment in condemnation proceedings is governed by the standard in all bench-tried cases. Santa Fe Trail Neighborhood Redevelopment Corp. v. W.F. Coen & Co., 154 S.W.3d 432, 439 (Mo.App.2005). "Under that standard, we are to sustain the action of the trial court unless there is no substantial evidence to support it, unless it is against the weight of the evidence, or unless it erroneously declares or applies the law. We should utilize our power to set aside a judgment with caution and only upon a firm belief that it was erroneous." State ex rel. Mo. Highway & Transp. Comm'n v. Quiko, 923 S.W.2d 489, 493 n. 2 (Mo.App. 1996) (internal citations omitted).

Point I

JISTA filed a Petition and Motion for Allocation of Condemnation Proceeds. JISTA alleged that there was a pending quiet title action prior to the condemnation of the property in question; that JISTA was a party to that action. JISTA's motion sought declaration that it was entitled to the funds paid into court "and to all damages that may be assessed in the Condemnation Action for the taking of [the property]."

JISTA requested a jury trial "on the commissioners' award and its right thereto." The request was denied at the commencement of the hearing on the motion for allocation of the condemnation proceeds. The trial court's docket entry dated September 17, 2007, states, "JISTA moves for jury determination, which is overruled, but which is to be a continuing objection."

Point I argues that the trial court erred in denying JISTA's request for jury trial in the allocation phase of the condemnation action "because both JISTA and Grant claimed to be the rightful owner of the property at the time of the condemnation order, and their claims both raised factual issues identical to a quiet title action, and were claims at law."

Condemnation proceedings are governed by statute. The City of Branson's action to condemn the property that is the subject of this appeal was undertaken pursuant to § 99.820.1(1) and (3), RSMo Cum. Supp.2005. Section 523.053, RSMo 2000, prescribes the procedure for distribution of condemnation awards among parties claiming an interest in the condemned property.²

Section 523.053.1 provides that if more than one party claims a determinable interest in proceeds of a commissioners' award, but those parties do not file an agreement that sets out the percentages in which the award is to be divided among them, then, within the time stated in the statute, "any defendant claiming such an interest may by motion for distribution petition the court in which said cause is pending for a determination of the percentage of the commissioners' award to which each of said parties is entitled." Section 523.053.2 states that when this occurs, "[w]ithin thirty days after the filing of such motion, the court having...