Cohen v. Battaglia, 99,793.

Citation202 P.3d 87
Decision Date06 March 2009
Docket NumberNo. 99,793.,99,793.
PartiesBarton J. COHEN, as trustee of the Barton J. Cohen Revocable Trust, and A. Baron Cass, III, as trustee of the A. Baron Cass Family Trust, u/t/a dated March 22, 1989, as amended, Appellants, v. Marion BATTAGLIA, Appellee.
CourtCourt of Appeals of Kansas

Alleen Castellani VanBebber and R. Pete Smith, of McDowell, Rice, Smith & Buchanan, P.C., of Kansas City, Missouri, for appellants.

Louis C. Accurso and E. Ann Wright, of The Accurso Law Firm, of Kansas City, Missouri, for appellee.

Before STANDRIDGE, P.J., PIERRON and BUSER, JJ.

STANDRIDGE, J.

Barton J. Cohen, as trustee of the Barton J. Cohen revocable trust (the Cohen Trust), and A. Baron Cass, III, as trustee of the A. Baron Cass Family Trust under trust agreement dated March 22, 1989, as amended (the Cass Trust), appeal the dismissal of their claims of tortious interference with a contract and tortious interference with a prospective business advantage and relationship.

Facts

The Cohen Trust and the Cass Trust filed a civil action in the Johnson County District Court against Marion Battaglia asserting the following claims: (1) tortious interference with existing contractual relations; (2) tortious interference with a prospective business advantage and relationship; and (3) specific performance of a contractual obligation. The claims against Battaglia were premised on the following factual allegations, which will be presented as described in the amended petition.

Prior to August 30, 2005, Battaglia owned a 20% interest in Baron Development Company, LLC (BDC), a Kansas limited liability company, and 2,222 shares of common stock in The Baron Automotive Group, Inc. (BAG). The remaining balance of the membership interest in BDC and the rest of the shares of common stock in BAG were owned by the Cohen Trust and Cass.

On August 30, 2005, the Cohen Trust and Cass purchased all of Battaglia's common stock in BAG. Battaglia remained an employee of the company.

At the same time as the BAG transaction, BDC redeemed Battaglia's interest in BDC, paying Battaglia $419,809 in cash and issuing him a promissory note worth $1,259,434. By way of a "`Pledge Agreement,'" the note was secured by a 20% first priority security interest in BDC.

The promissory note provided that it would become due and payable in full if BDC or BAG were sold to an unrelated party. Pursuant to the pledge agreement, BDC further promised not to sell any portion of Battaglia's 20% security interest without Battaglia's consent. Once all of the obligations under the note were performed and the "`[t]ermination date'" of the agreement was reached, however, Battaglia's consent to the sale of his collateral was no longer required.

After the transactions with Battaglia were completed, Cass transferred all of his interests in BDC and BAG to the Cass Trust. In October 2006, Cass and Cohen (Trustees) and BAG agreed with Group 1 Automotive, Inc. (Group 1) that (1) Trustees would sell 100% of the membership interests in BDC (which would include Battaglia's 20% security interest) to Group 1, and (2) BAG would sell all of its assets to Group 1. The parties set January 16, 2007, as the closing date for the sales. The sale of the interests in BDC to Group 1 would take place simultaneously with the payment in full of the promissory note to Battaglia; thus, Trustees took the position that Battaglia's consent to the sale was not required.

After being informed of the sale agreements, Battaglia demanded to know the purchase price and other details. Cohen refused on the basis that Battaglia was not a "`seller'" under the sale agreements, the transactions with Group 1 were confidential, and disclosure of the information might jeopardize the agreements. Battaglia disputed these assertions, arguing that, as the president of BAG and because of his security interest in BDC, he was entitled to copies of the contracts regarding the sale agreements. In response, counsel for Trustees and BAG countered that Battaglia was not entitled to see the documents relating to the sales agreements because Battaglia was neither a shareholder of BAG, a member of BDC, nor a director of either entity, and thus had no interest in either BAG or BDC except as the holder of a promissory note.

Battaglia knew that the closing with Group 1 was scheduled for January 16, 2007. On January 12, 2007, Louis C. Accurso, Battaglia's attorney, filed a civil action on behalf of Battaglia in the circuit court of Jackson County, Missouri, naming Cohen, the Cohen Trust, Cass, BAG, and BDC as defendants (the Missouri action). That same day, Accurso faxed to Group 1's general counsel a copy of the Missouri action with the following notation: "`Please find enclosed a file-stamped copy of a lawsuit filed today on behalf of Marion Battaglia. If you have any questions or comments, please do not hesitate to contact me.'"

At the time the Missouri action was filed, Group 1 had no ownership interest in BDC or BAG. Also, Group 1's general counsel was neither counsel for, nor a registered agent of, BDC or BAG. According to Trustees, Accurso's conduct in "[s]ending the letter and a copy of the Petition for the Missouri Action served no purpose except to interfere with the sale transactions."

As a result of Accurso's actions, Group 1 contacted counsel for Trustees and expressed reservation about closing the sales. Specifically, Group 1 refused to close without altering the agreements to include a supplemental indemnification agreement from BDC, the Cohen Trust, and the Cass Trust. Also, Group 1 required that $2,500,000 be placed in escrow for the benefit of Group 1. Trustees incurred substantial attorney fees in complying with Group 1's additional demands.

On January 16, 2007, the sale agreements closed, with Trustees receiving $2,500,000 less than the agreed-upon purchase price due to the escrow. Simultaneous with the closing, Trustees paid the promissory note in full, which Battaglia accepted. Shortly afterwards, Trustees filed this lawsuit against Battaglia setting forth claims for tortious interference with a contract, tortious interference with a business expectancy, and specific performance. Battaglia filed a motion to dismiss the tortious interference claims, which the district court ultimately granted. In a separate order, the court thereafter declined to exercise subject matter jurisdiction over the claim for specific performance. Trustees appeal.

Subject Matter Jurisdiction

At oral argument, Battaglia argued for the first time on appeal that the district court's dismissal of this cause of action without prejudice did not constitute a final judgment from which Trustees can appeal. Whether jurisdiction exists is a question of law over which an appellate court's scope of review is unlimited. Foster v. Kansas Dept. of Revenue, 281 Kan. 368, 369, 130 P.3d 560 (2006). Subject matter jurisdiction may be raised at any time, whether for the first time on appeal or even on the appellate court's own motion. Vorhees v. Baltazar, 283 Kan. 389, 397, 153 P.3d 1227 (2007). If the record shows there is no jurisdiction for an appeal, the appeal must be dismissed. State v. Harp, 283 Kan. 740, 746, 156 P.3d 1268 (2007).

Kansas appellate courts may only exercise jurisdiction over appeals from district court as allowed by statute and, therefore, do not have discretionary power to entertain appeals from all district court orders. Flores Rentals v. Flores, 283 Kan. 476, 480-81, 153 P.3d 523 (2007). K.S.A.2008 Supp. 60-2102a sets forth those orders and decisions of a district court over which this court has jurisdiction. K.S.A.2008 Supp. 60-2102a(a)(4) allows jurisdiction over "[a] final decision in any action, except in an action where a direct appeal to the supreme court is required by law." Trustees contend that the district court's dismissal without prejudice constituted a final judgment, while Battaglia asserts that it did not.

A final decision generally disposes of the entire merits of the case and leaves no further questions or the possibility of future directions or actions by the court. The term "`final decision'" is self-defining and refers to an order that definitely terminates a right or liability involved in an action or that grants or refuses a remedy as the final act in the case. Flores, 283 Kan. at 481-82, 153 P.3d 523.

The question presented here is whether an involuntary dismissal without prejudice, made upon the defendant's motion, constitutes a final judgment. Previous Kansas case law has addressed similar, but not identical, questions. In Brower v. Bartal, 268 Kan. 43, 45-46, 990 P.2d 1235 (1999), and Bain v. Artzer, 271 Kan. 578, 579-81, 25 P.3d 136 (2001), the Kansas Supreme Court determined that an order granting a voluntary dismissal without prejudice, with conditions for refiling, on plaintiff's motion did not constitute a final judgment.

However, in a 2004 unpublished opinion, a panel of this court determined there was sufficient finality for appellate jurisdiction where an action was involuntarily dismissed without prejudice, but the plaintiff claimed potential prejudice from the dismissal because a second lawsuit might not relate back and, therefore, could be subject to dismissal based on the statute of limitations. Nelson v. Kaw Valley Center, Inc., No. 90,510, 2004 WL 794472, unpublished opinion filed April 9, 2004. It seems reasonable to extrapolate and apply a rule from Nelson that where a case has been involuntarily dismissed without prejudice, there will be appellate jurisdiction of such dismissal only where the plaintiff contends that he or she will suffer some real prejudice from the dismissal. A dismissal without prejudice contemplates by its very nature the possibility of refiling an action that is exactly or substantially the same as the action dismissed. Judicial economy is not served by allowing an appeal from such a dismissal when a plaintiff does not show that he or she will be adversely...

To continue reading

Request your trial
13 cases
  • Kansas State University v. Prince
    • United States
    • U.S. District Court — District of Kansas
    • December 8, 2009
    ...repudiation is a breach of contract which authorizes the nonbreaching party to bring an immediate action." Cohen v. Battaglia, 41 Kan.App.2d 386, 393, 202 P.3d 87 (2009), citing Hawkinson v. Bennett, 265 Kan. 564, 602, 962 P.2d 445 (1998). Kansas law generally recognizes that unless a party......
  • Recio v. Evers
    • United States
    • Nebraska Supreme Court
    • August 28, 2009
    ...Gold, Inc. v. 71 Const., Inc., 809 P.2d 236 (Wyo.1991); Montrone v. Maxfield, 122 N.H. 724, 449 A.2d 1216 (1982); Cohen v. Battaglia, 41 Kan. App.2d 386, 202 P.3d 87 (2009); Kutcher v. Zimmerman, 87 Hawai`i 394, 957 P.2d 1076 (Haw.App.1998); Savage v. Pacific Gas and Elec. Co., 21 Cal.App.4......
  • State v. Sales
    • United States
    • Kansas Supreme Court
    • January 29, 2010
    ...appeal or even on the appellate court's own motion. Vorhees v. Baltazar, 283 Kan. 389, 397, 153 P.3d 1227 (2007); Cohen v. Battaglia, 41 Kan.App.2d 386, 389, 202 P.3d 87 (2009). The appellee has raised the issue of this court's jurisdiction under K.S.A. 22-3603 through a letter filed pursua......
  • Byers v. Snyder
    • United States
    • Kansas Court of Appeals
    • August 20, 2010
    ...a prospective business advantage or relationship seeks to protect future or potential contractual relations." Cohen v. Battaglia, 41 Kan. App. 2d 386, 396, 202 P.3d 87 (2009), rev. granted 289 Kan. 1277 (2010). Despite these differences, the torts are similar in that they are predicated on ......
  • Request a trial to view additional results
1 books & journal articles
  • The Interference Torts
    • United States
    • ABA Antitrust Library Business Torts and Unfair Competition Handbook Business tort law
    • January 1, 2014
    ...must be actual knowledge – objective standards like implied knowledge or constructive knowledge are insufficient”); Cohen v. Battaglia, 202 P.3d 87, 94 (Kan. Ct. App. 2009) (plaintiff not required to allege knowledge of precise terms of contract or relationship); Birdsong v. Bydalek, 953 S.......

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT