Investors v. Kan. City Downtown Streetcar Transp. Dev. Dist., No. WD 76354.

CourtMissouri Court of Appeals
Writing for the CourtALOK AHUJA
Citation414 S.W.3d 470
PartiesKCAF INVESTORS, L.L.C., Sue Ann Burke, Logic II, L.L.C., Logic III, L.L.C. and Stretch/Jeffrey Rumaner, Appellants, v. KANSAS CITY DOWNTOWN STREETCAR TRANSPORTATION DEVELOPMENT DISTRICT, A Missouri Political Subdivision, Respondent.
Decision Date24 December 2013
Docket NumberNo. WD 76354.

414 S.W.3d 470

KCAF INVESTORS, L.L.C., Sue Ann Burke, Logic II, L.L.C., Logic III, L.L.C. and Stretch/Jeffrey Rumaner, Appellants,
v.
KANSAS CITY DOWNTOWN STREETCAR TRANSPORTATION DEVELOPMENT DISTRICT, A Missouri Political Subdivision, Respondent.

No. WD 76354.

Missouri Court of Appeals,
Western District.

Aug. 7, 2013.
Motion for Rehearing and/or Transfer to Supreme Court Denied Oct. 1, 2013.

Application for Transfer Denied Dec. 24, 2013.


[414 S.W.3d 471]


Mark J. Bredemeier, Lee's Summit, MO, for appellant.

Robert A. Henderson and Douglas S. Stone, Kansas City, MO, for respondent.


Before Division Four: JAMES E. WELSH, P.J., ALOK AHUJA, J. and JACK R. GRATE, SP. J.

ALOK AHUJA, Judge.

KCAF Investors, L.L.C, Logic II, L.L.C, Logic III, L.L.C, Sue Anne Burke, and Jeffrey “Stretch” Rumaner (collectively “Appellants”) appeal from a judgment entered by the Circuit Court of Jackson County. The circuit court dismissed Appellants' claims that certain real-property assessments and sales taxes imposed within the Kansas City Downtown Streetcar Transportation Development District are unlawful, based on the court's conclusion that Appellants' claims were untimely, and should have been asserted in earlier litigation. We affirm.

Factual Background 1

The Kansas City Downtown Streetcar Transportation Development District was

[414 S.W.3d 472]

formed in 2012 pursuant to the Missouri Transportation Development District Act, §§ 238.200 to 238.280.2 The Streetcar District was formed for the purpose of constructing and operating a streetcar line to run for approximately two miles along Main Street in downtown Kansas City. The construction and operation of the streetcar line is to be funded, in substantial part, by special assessments on real property located within the District, and by a sales tax, not to exceed one percent, on retail sales within the District. According to Appellants' petition, the streetcar line is estimated to cost in excess of $100 million.

The formation of the District was initiated by a prior lawsuit filed pursuant to §§ 238.207 to 238.212. On February 6, 2012, the City Council of the City of Kansas City, and the Board of Commissioners of the Port Authority of Kansas City, filed a petition in the Circuit Court of Jackson County requesting that the circuit court call an election to authorize the formation of the Streetcar District. City Council of the City of Kansas City, Missouri, et al. v. Kansas City Area Transportation Authority, et al., Case No. 1216–CV02419 (the “Formation Lawsuit”). The City and Port Authority named the Missouri Highway and Transportation Commission and the Kansas City Area Transportation Authority as respondents in the Formation Lawsuit.

Pursuant to § 238.212.1, the Circuit Court ordered notice of the pending suit to be published in the Kansas City Star once a week for four consecutive weeks in February and March 2012, advising the public that pleadings in support of or opposition to the petition were to be filed no later than April 2, 2012, and also notifying the public of the dates scheduled for a public hearing and a judicial hearing on the petition. A number of entities filed pleadings in support. U.S. Trust, Bank of America N.A., Trustee, filed an Answer and Reply in opposition, which was voluntarily dismissed on April 12, 2012. No other opposition was filed.

The court conducted a public hearing on the issues raised in the Formation Lawsuit on April 17, 2012, and a judicial hearing on April 18, 2012. Eleven persons testified at the public hearing in support of the petition; three persons testified in opposition.

Following the hearings, the circuit court entered a sixteen-page judgment in the Formation Lawsuit on April 27, 2012. As required by § 238.210.2, the circuit court determined: that the petition was in proper form and had been properly served; that the proposed Streetcar District, and the funding mechanisms to be employed to finance the streetcar project, were lawful and constitutional; and that the District and the proposed funding mechanisms would not impose an undue burden on any property owner within the District, and were not unjust or unreasonable. Based on those determinations, the circuit court ordered the conduct of a “Formation Election” by mail-in ballot, in which the District's formation was approved by voters by a margin of 319 votes in favor, and 141

[414 S.W.3d 473]

opposed. No appeal was taken from the circuit court's judgment in the Formation Lawsuit.

Following the certification of the results of the Formation Election, the circuit court entered a further order in the Formation Lawsuit on August 2, 2012, declaring the formation and existence of the Streetcar District. On August 24, 2012, the circuit court entered an order calling a second mail-in ballot election, to authorize the imposition of the sales tax, and the special assessments on real property within the District. The sales tax passed by a vote of 351 in favor and 198 opposed; the real-property special assessments passed by a vote of 344 in favor and 206 opposed. The results of the election approving the District's funding mechanisms were certified on December 12, 2012.

Only natural persons residing within the District were permitted to vote in either election.

On January 31, 2013, Appellants filed a Petition for Declaratory Judgment and Injunctive Relief against the District in the Circuit Court of Jackson County. The limited liability companies allege that they own real property in the District which will be subject to the special assessments. The individual plaintiffs, Ms. Burke and Mr. Rumaner, allege that they are the owners and managing members of the limited liability company-plaintiffs; they also allege that they regularly shop in the District, and are therefore subject to the special sales tax.

Appellants' petition alleges that the real property special assessments are unlawful, because owners of real property in the District were not notified of, or permitted to vote in, the election which authorized the special assessments. Appellants allege that the sales tax is unlawful with respect to part of the District, because part of the Streetcar District also falls within the pre-existing 1200 Main/South Loop Transportation Development District, and is already subject to a one-percent retail sales tax to fund that district. Appellants note that § 238.235.1(7) provides that the sales tax supporting a transportation development district is limited to a one-percent rate; Appellants contend that § 238.235.1(7) does not permit the “stacking” of separate transportation-related sales taxes, in excess of the one-percent limit. Appellants' petition prays for a judgment declaring the real-property special assessments and the sales tax (as applied in the area overlapping the 1200 Main District) to be unlawful; they also seek injunctive relief against the collection of the allegedly unlawful levies.

On March 15, 2013, the circuit court entered its judgment granting the Streetcar District's motion to dismiss Appellants' petition. The court held that Appellants' challenges to the real-property special assessments were “election contests” which were untimely under § 115.577, because Appellants did not bring their claims within thirty days of the certification of the results of the election approving the special assessments. The circuit court also held that Appellants were estopped from asserting any of their claims because they should have raised their challenges in the Formation Lawsuit, prior to the elections which authorized the District's formation and the imposition of the sales tax and real-property assessments.

This appeal follows.

Analysis

Exercising de novo review, In re T.Q.L., 386 S.W.3d 135, 139 (Mo. banc 2012), we conclude that Appellants are estopped from asserting their claims because those claims could, and should, have been raised and decided in the Formation Lawsuit.

[414 S.W.3d 474]

I.

The Missouri Transportation Development District Act establishes a detailed scheme for the formation of transportation development districts, and for the adoption of particular funding mechanisms to finance covered transportation projects.

Section 238.205.1 provides that a transportation development district “may be created to fund, promote, plan, design, construct, improve, maintain, and operate one or more projects or to assist in such activity.” Transportation development districts formed under the Act are political subdivisions of the State. § 238.205.2.

The Act specifies that a covered “project”

includes any bridge, street, road, highway, access road, interchange, intersection, signing, signalization, parking lot, bus stop, station, garage, terminal, hangar, shelter, rest area, dock, wharf, lake or river port, airport, railroad, light rail, or public mass transportation system and any similar or related improvement or infrastructure. In the case of a district located in a home rule city with more than four hundred thousand inhabitants and located in more than one county, whose district boundaries are contained solely within that portion of such a home rule city that is contained within a county with a charter form of government and with more than six hundred thousand but fewer than seven hundred thousand inhabitants, the term project shall also include the operation of a street car or other rail-based or fixed guideway public mass transportation system, and the revenue of such district may be used to pay for the design, construction, ownership and operation of such a street car or other rail-based or fixed guideway public mass transportation system, but not the operation of a bus system located within such district, by such district or such municipality, or by a local transportation authority having jurisdiction within such municipality.

§ 238.202.1(5).3 The methods available to fund covered projects, which include retail sales taxes and special assessments on real property, are specified in §§ 238.227 to...

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6 practice notes
  • Daz Mgmt., LLC v. Honnen Equip. Co., 20200656
    • United States
    • Supreme Court of Utah
    • March 17, 2022
    ...is an entity distinct from its member or members.").60 See, e.g., KCAF Invs., L.L.C. v. Kan. City Downtown Streetcar Transp. Dev. Dist., 414 S.W.3d 470, 481 n.7 (Mo. Ct. App. 2013) ; In re Mickletz, 544 B.R. 804, 816 (Bankr. E.D. Pa. 2016).61 See RESTATEMENT § 59 cmt. e (stating that the cl......
  • Daz Mgmt. v. Honnen Equip. Co., 20200656
    • United States
    • Supreme Court of Utah
    • March 17, 2022
    ...is an entity distinct from its member or members."). [60] See, e.g., KCAF Invs., L.L.C. v. Kan. City Downtown Streetcar Tramp. Dev. Dist, 414 S.W.3d 470, 481 n.7 (Mo.Ct.App. 2013); In re Mickletz, 544 B.R. 804, 816 (Bankr. E.D. Pa. 2016). [61] See Restatement §59 cmt. e (stating that the cl......
  • Pauli v. Spicer, No. ED 101231.
    • United States
    • United States District Courts. 8th Circuit. United States District Court (Eastern District of Missouri)
    • October 14, 2014
    ...representation, a judge-made preclusion doctrine. See KCAF Investors, L.L.C. v. Kansas City Downtown Streetcar Transp. Dev. Dist., 414 S.W.3d 470, 487 (Mo.App. W.D.2013). Because preclusion doctrines do not generally apply to judgments that are void, the threshold question in this case is w......
  • Pauli v. Spicer, No. ED 101231.
    • United States
    • Court of Appeal of Missouri (US)
    • October 14, 2014
    ...representation, a judge-made preclusion doctrine. See KCAF Investors, L.L.C. v. Kansas City Downtown Streetcar Transp. Dev. Dist., 414 S.W.3d 470, 487 (Mo.App. W.D.2013). Because preclusion doctrines do not generally apply to judgments that are void, the threshold question in this case is w......
  • Request a trial to view additional results
6 cases
  • Daz Mgmt., LLC v. Honnen Equip. Co., 20200656
    • United States
    • Supreme Court of Utah
    • March 17, 2022
    ...is an entity distinct from its member or members.").60 See, e.g., KCAF Invs., L.L.C. v. Kan. City Downtown Streetcar Transp. Dev. Dist., 414 S.W.3d 470, 481 n.7 (Mo. Ct. App. 2013) ; In re Mickletz, 544 B.R. 804, 816 (Bankr. E.D. Pa. 2016).61 See RESTATEMENT § 59 cmt. e (stating that the cl......
  • Daz Mgmt. v. Honnen Equip. Co., 20200656
    • United States
    • Supreme Court of Utah
    • March 17, 2022
    ...is an entity distinct from its member or members."). [60] See, e.g., KCAF Invs., L.L.C. v. Kan. City Downtown Streetcar Tramp. Dev. Dist, 414 S.W.3d 470, 481 n.7 (Mo.Ct.App. 2013); In re Mickletz, 544 B.R. 804, 816 (Bankr. E.D. Pa. 2016). [61] See Restatement §59 cmt. e (stating that the cl......
  • Pauli v. Spicer, No. ED 101231.
    • United States
    • United States District Courts. 8th Circuit. United States District Court (Eastern District of Missouri)
    • October 14, 2014
    ...representation, a judge-made preclusion doctrine. See KCAF Investors, L.L.C. v. Kansas City Downtown Streetcar Transp. Dev. Dist., 414 S.W.3d 470, 487 (Mo.App. W.D.2013). Because preclusion doctrines do not generally apply to judgments that are void, the threshold question in this case is w......
  • Pauli v. Spicer, No. ED 101231.
    • United States
    • Court of Appeal of Missouri (US)
    • October 14, 2014
    ...representation, a judge-made preclusion doctrine. See KCAF Investors, L.L.C. v. Kansas City Downtown Streetcar Transp. Dev. Dist., 414 S.W.3d 470, 487 (Mo.App. W.D.2013). Because preclusion doctrines do not generally apply to judgments that are void, the threshold question in this case is w......
  • Request a trial to view additional results

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