Dixon v. Shafton, 63923

Citation649 S.W.2d 435
Decision Date26 April 1983
Docket NumberNo. 63923,63923
PartiesArthur J. DIXON, et al., Plaintiffs, v. Isadore SHAFTON, et al., Appellants, and Kenneth BIGUS, Respondent, v. Walter LEINHARDT, Third-Party Defendant.
CourtUnited States State Supreme Court of Missouri

Roy Bash, Randall C. Werntz, Samuel J. Molby, Kansas City, for appellants.

Theodore J. Furry, Robert A. Schroeder, Lawrence W. Bigus, Kansas City, for respondent.

RENDLEN, Chief Justice.

This case originated as a suit by Dixon and Aeder, partners in Carlton Green Associates, against Shafton, Turek, Epstein, Lieberman and Bigus, partners in Granada Associates, on a contract claim. The four first named Granada partners cross-claimed against Bigus, who, in addition to being a partner, is a practicing attorney in Kansas City and acted as the attorney for the Granada partners in the transaction with Carlton. The cross-claim charged that Bigus had committed legal malpractice in regard to this contract by advising the other Granada partners to sign it even though it contained a clause (the inserted clause) requiring Granada to pay contingent accruals of interest and taxes, the amount of which would depend on when the final closing of certain parts of the transaction could be arranged.

The plaintiffs sued for $160,161.50 plus interest. This claim was settled for $135,000 with the settlement leaving the cross-claiming appellants free to pursue their cross-claim against Bigus, and without Bigus having waived any defenses he would otherwise have had. Bigus then filed a motion for summary judgment which the trial court sustained. An expanded seven-member panel of the Court of Appeals--Western District affirmed by a vote for four to three. Judge Pritchard, author of the dissenting opinion, ordered the case transferred here because he believed that the opinion was in conflict with Hunter v. Hunter, 361 Mo. 799, 237 S.W.2d 100 (Mo.1951) and De Paul Hospital School of Nursing, Inc. v. Southwestern Bell Telephone Co., 539 S.W.2d 542 (Mo.App.1976). We decide the case as an original appeal. 1

The motion for summary judgment was accompanied by suggestions. Bigus filed an affidavit stating that the facts set forth in "statement of facts" in his suggestions were true "according to his best knowledge and belief." The appellants then filed suggestions in opposition containing a statement of facts and Shafton, one of the appellants, likewise filed an affidavit stating that the facts there stated were true "according to his best knowledge and belief." Shafton also filed an additional affidavit with a similar reservation. These affidavits leave much to be desired, and their compliance with Rule 74.04(e) is marginal at best. A statement that something is true "according to his best knowledge and belief" is an equivocation. Inasmuch as neither party made a point of these deficiencies, and inasmuch as the court of appeals felt that the issues were squarely presented, we shall not hold the affidavits to be insufficient. Our duty is to determine whether Bigus has "shown by unassailable proof" that he is entitled to judgment "as a matter of law." We determine that the following facts were established by the appropriate degree of proof:

1. The Carlton-Granada agreement was signed on August 3, 1971. It contained the clause in question. The presence of this clause was unknown to Bigus, who did not read the final version of the contract before signing it, before executing it for another partner through power of attorney, and before recommending that the remaining Granada partners sign it.

2. Bigus first learned of the inserted clause on January 19, 1973 when the plaintiffs first disclosed a claim for additional revenues at the January 12, 1973 closing. Bigus immediately disclosed the existence of the clause to the other Granada partners and recommended that Granada retain counsel. On February 14, 1973 Granada retained the firm of Rogers, Field, Gentry, Benjamin and Robertson to represent their interest.

3. The appellants and Bigus entered into negotiation with Carlton and took the position that the inserted clause had been inserted into the contract through mistake or fraud, and was not binding on the Granada partners.

4. The Carlton partners filed suit in New York in October of 1975 against the Granada partners.

5. The present action was filed October 25, 1977 by the Carlton partners against the Granada partners.

6. The cross claim of the appellants against Bigus was filed on May 1, 1978.

7. The appellants and Bigus filed pleadings raising issues of fraud and mistake in opposition to the plaintiffs' claim.

The trial court held that the appropriate statute of limitations was § 516.120 RSMo 1978, imposing a limitation of five years. This conclusion does not appear to be questioned. The trial judge held that the period of the statute commenced running when the contract was signed on August 3, 1971, or in any event at the latest on January 19, 1973, which was the date performance of the obligation apparently created by the inserted clause was due. The appellants argued that the statute did not begin to run until November 1975, which was the day the plaintiffs first filed suit in New York asserting a claim under the inserted clause.

The appellants rely on § 516.100 RSMo 1978, which in pertinent parts is as follows:

Civil actions, other than those for the recovery of real property, can only be commenced within the periods prescribed in the following sections, after the causes of action shall have accrued; provided that for the purposes of sections 516.100 to 516.370, the cause of action shall not be deemed to accrue when the wrong is done or the technical breach of contract or duty occurs, but when the damage resulting therefrom is sustained and is capable of ascertainment, and, if more than one item of damage, then the last item, so that all resulting damage may be recovered, and full and complete relief obtained. (Emphasis supplied.)

The appellants argue, vigorously, that no damage was sustained until the plaintiffs filed suit on the obligation arising under the inserted clause, which was in October of 1975. They say that damages were not "capable of ascertainment" until this suit was filed and that, in particular, one item of damages, consisting of taxes on the property that had been sold, could not have been ascertained within five years of the date of filing of the cross claim on May 1, 1978. They also argue that Bigus was "estopped from pleading the statute of limitations on the claim against him," because, after new counsel were retained by the Granada partners, he consistently took the position that the disputed claim was not a part of the Carlton-Granada contract.

We conclude that the record before us establishes that the statute of limitations commenced running no later than February 14, 1973. This is the date on which the appellants, after Bigus notified them of his mistake, retained independent counsel. We do not have to decide, then, whether the statute commenced running at the time Bigus made his mistake. On February 14, 1973, the appellants knew that a substantial claim existed as to them. They had suffered some damage, at least to the extent that they had to hire new counsel who would have otherwise been unnecessary. They also realized they could avoid liability, if at all, only with the expenditure of even more substantial amounts for attorney's fees.

Section 516.100 was adopted in its present form in 1919 and has been construed on numerous occasions since that time. The word "ascertain" has always been read as referring to the fact of damage, rather than to the precise amount. The point is illustrated by Allison v. Missouri Power and Light Co., 59 S.W.2d 771 (Mo.App.1933). The plaintiff there was struck with an iron bar in 1926 and realized he had suffered some injury at that time, but he claimed that he did not realize that his injuries were serious and disabling until 1929. The court held, nonetheless, that the five year statute began to run in 1926, so that a suit filed in 1932 was barred. The opinion held that the legal injury was complete when the accident occurred, even though the full extent of the damages could not then be determined.

Allison has been cited by this Court with approval in Chemical Workers Basic Union, Local No. 1744 v. Arnold Savings Bank, 411 S.W.2d 159, 164 (Mo. banc 1966). See also Rippe v. Sutter, 292 S.W.2d 86, 90 (Mo.1956); Gruenewaelder v. Wintermann, 360 S.W.2d 678, 690 (Mo.1962). Thorne v. Johnson, 483 S.W.2d 658 (Mo.App.1972), cited by the appellee, might be read as being critical of Allison, but it reaches a result that is consistent with our conclusion. There an abstract company had omitted a deed of a one half interest from an abstract certified in 1957. The court held that the five-year statute did not begin to run until 1968, when the grantee in the omitted deed commenced suit to protect his interest. The significant circumstance, however, was that the purchasers did not discover the problem until 1968. The only reasonable means of discovering the omission was through...

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