GOOD HOPE v. ST. LOUIS ALARM MONITORING

• Decision Date: 16 March 2010
• Docket Number: No. ED 92566.,ED 92566.
• Parties: GOOD HOPE MISSIONARY BAPTIST CHURCH, Plaintiff/Appellant, v. ST. LOUIS ALARM MONITORING COMPANY, INC., Defendant/Respondent.
• Court: Missouri Court of Appeals

306 S.W.3d 185

GOOD HOPE MISSIONARY BAPTIST CHURCH, Plaintiff/Appellant, v. ST. LOUIS ALARM MONITORING COMPANY, INC., Defendant/Respondent.

No. ED 92566.

Missouri Court of Appeals, Eastern District, Division One.

March 16, 2010.

Robert W. Cockerham, Samuel John Vincent III, Brown & James, P.C., St. Louis, MO, for appellant.

Ted L. Perryman, Thomas G. Wilmowski, Jr., Roberts, Perryman, Bomkamp & Meives, P.C., St. Louis, MO, for respondent.

KATHIANNE KNAUP CRANE, Presiding Judge.

This dispute involves a settlement agreement arising out of a lawsuit in which Good Hope Missionary Baptist Church, (Good Hope) sought damages from St. Louis Alarm Monitoring Company, Inc., (SLAM) after a fire damaged its premises. A high-low settlement agreement was put on the record before the trial court received the jury's verdict.¹ Both parties filed motions to enforce this agreement. The parties disputed whether the agreement included prejudgment interest, and each alleged a restriction on their respective counsel's authority to settle. The trial court entered a judgment on the pleadings, in which it granted SLAM's motion to enforce settlement, concluding that the settlement did not include prejudgment interest. Good Hope appeals. We reverse and remand because Good Hope's responsive motion alleged facts that must be taken as true and that precluded the entry of judgment on the pleadings in SLAM's favor as a matter of law.

Because this is an appeal from a judgment on the pleadings, we focus only on the pleadings. Approximately two weeks after the trial ended, SLAM filed a motion to enforce settlement. SLAM's motion alleged that the parties had negotiated a high-low settlement agreement after a week-long trial, but before the court received the jury's verdict. It alleged its interpretation of the terms of the settlement agreement, that the agreement was put on the record, and that the jury returned a verdict in the amount of $1,000,000. It further alleged that prior to the court's acceptance of the jury's verdict, neither Good Hope's counsel nor SLAM's counsel represented that the settlement agreement would include prejudgment interest or that prejudgment interest would be paid on the amount of the verdict as part of the settlement agreement. It alleged that both counsel and both parties discussed the issue of prejudgment interest in great detail during settlement negotiations and that SLAM continually disputed that Good Hope was entitled to prejudgment interest. It requested that the settlement be enforced in the amount of the $1,000,000 verdict. SLAM attached to its motion a typewritten transcription of the agreement, a copy of the verdict, and counsel's affidavit attesting that he had negotiated the agreement with Good Hope's counsel, had never agreed to prejudgment interest, and had not discussed prejudgment interest with Good Hope's counsel between the time the jury announced it had reached a verdict and the trial court received it. He also attested to his lack of authority to enter into a settlement agreement that included prejudgment interest.

After SLAM filed its motion, the trial court entered judgment in Good Hope's favor in the amounts of $1,000,000 on the jury verdict and $360,000 as prejudgment interest.

Thereafter, Good Hope responded to SLAM's motion with its "Plaintiff's Motion to Enforce Settlement Agreement and Response in Opposition to Defendant's Motion to Enforce Settlement." In the 42 paragraph Statement of Facts in this document, Good Hope alleged that throughout the trial, counsel for the parties took part in settlement negotiations; the subject of prejudgment interest was continuously discussed and was an essential element in those negotiations; before settlement was reached, the trial court ruled it would enter prejudgment interest in favor of Good Hope if a verdict was returned in Good Hope's favor; that settlement negotiations continued on the basis that prejudgment interest would apply to, and be part of, any settlement; that SLAM had offered to settle the case for $1,360,000, which was the amount of SLAM's insurance policy ($1,000,000), plus prejudgment interest ($360,000) on the $1,000,000 policy; that the parties discussed settlement further and asked for leave of court to hold the reading of the verdict so the parties could reach a settlement; that the parties agreed upon a high-low settlement agreement with the understanding that prejudgment interest would be applicable to the judgment; that the parties agreed that the judgment would include prejudgment interest and there were no discussions or agreements to the contrary; that Good Hope's counsel was only authorized to enter into a settlement agreement that included prejudgment interest on the verdict; that the $1,360,000 "high" in the settlement agreement was based on the $1,000,000 amount of SLAM's insurance policy covering the loss plus prejudgment interest on $1,000,000; and that the jury returned a verdict in Good Hope's favor in an amount of $1,000,000. Good Hope contended that the parties' settlement agreement included prejudgment interest on the amount of the verdict, and requested that the settlement agreement be enforced in the amount of $1,360,000. Good Hope attached to its motion its attorneys' and client representatives' affidavits attesting to Good Hope's limitation on its counsels' authority to settle, the conversations with SLAM, and other circumstances leading up to the settlement; correspondence between the parties' attorneys; a typewritten transcription of portions of the trial court record in which prejudgment interest was discussed and the trial court ruled it would be applicable; and a typewritten transcription of the settlement agreement.

The trial court heard argument on these motions and on SLAM's separate motion to set aside the trial court's judgment in the amount of $1,360,000.00. The trial court subsequently entered a judgment that (1) granted SLAM's motion to enforce settlement based on its determination as a matter of law that (a) the parties had entered into a binding and enforceable settlement agreement, (b) the amount of the settlement was $1,000,000 based on the jury's verdict in that amount, and (c) the settlement did not include prejudgment interest; (2) declared SLAM was entitled to judgment on the pleadings pursuant to Rule 55.27(b); (3) denied Good Hope's request for an evidentiary hearing; and (4) dismissed Good Hope's cause of action with prejudice. Good Hope appeals from this judgment.

DISCUSSION

In its two points on appeal, Good Hope asserts that the trial court erred in entering judgment on the pleadings, granting SLAM's motion to enforce settlement, and in dismissing Good Hope's cause of action because (1) the pleadings and attachments raised material issues of fact with respect to Good Hope's defense of lack of authority; and (2) the pleadings and attachments demonstrate either (a) the parties' agreement that SLAM would pay prejudgment interest on the verdict, or (b) an ambiguity in the settlement agreement; or (3) the agreement's terms and relevant extrinsic evidence permit only an interpretation of the agreement that includes prejudgment interest.

There is no specific process in Missouri for enforcing an agreement settling a pending case. Eaton v. Mallinckrodt, Inc., 224 S.W.3d 596, 599 (Mo. banc 2007). Settlement may be raised as an affirmative defense or, as here, by a motion to enforce the settlement agreement. Id. "A motion to enforce a settlement adds to the underlying case a collateral action seeking specific performance of the agreement." Id. The moving party must prove the existence of the agreement by clear, convincing, and satisfactory evidence. Id.

When presented with a motion to enforce settlement, the trial court may take one of three avenues: (1) it may hold an evidentiary hearing on the motion to determine the disputed facts and then enter judgment after taking evidence to prove the agreement and any defenses the non-moving party may proffer; (2) it may dispose of the motion on the pleadings pursuant to Rule 55.27; or (3) it may treat the motion as akin to that for summary judgment pursuant to Rule 74.04. Id. Of these three avenues, the most desirable approach "by far" is for the trial court to hold an evidentiary hearing in which the moving party proves the agreement, and the non-moving party can present evidence of its defenses. Id.

In this case, the trial court entered judgment on the pleadings.² A motion for judgment on the pleadings is authorized by Rule 55.27(b), which provides:

(b) Motion for Judgment on the Pleadings. After the pleadings are closed but within such time as not to delay the trial, any party may move for judgment on the pleadings. If, on a motion for judgment on the pleadings, matters outside the pleadings are presented to and not excluded by the court, the motion shall be treated as one for summary judgment and disposed of as provided in Rule 74.04, and all parties shall be given reasonable opportunity to present all materials made pertinent to such a motion by Rule 74.04.

This motion is of common law origin, and it is not favored by the courts. McIntosh v. Foulke, 360 Mo. 481, 228 S.W.2d 757, 761 (1950). "The question presented by a motion for judgment on the pleadings is whether the moving party is entitled to judgment as a matter of law on the face of the pleadings.'" Eaton, 224 S.W.3d at 599 (quoting RGB2, Inc. v. Chestnut Plaza, Inc., 103 S.W.3d 420, 424 (Mo.App.2003)). Judgment on the pleadings is only appropriate when the question before the court is strictly one of law. Eaton, 224 S.W.3d at 599. A trial court should not grant a motion for judgment on the pleadings if a material issue of fact exists. Madison Block Pharmacy v. U.S. Fidelity, 620 S.W.2d 343, 345 (Mo. banc 1981). Such a motion may be sustained only when, "`under the conceded facts, a judgment different from that pronounced could not be rendered notwithstanding any...