Jackson County v. McClain Enterprises, Inc.

• Decision Date: 09 May 2006
• Docket Number: No. WD 66025.,WD 66025.
• Citation: 190 S.W.3d 633
• Parties: JACKSON COUNTY, Missouri, Respondent, v. McCLAIN ENTERPRISES, INC. et al, Defendant Bill House Excavating Co., Appellant.
• Court: Missouri Court of Appeals

190 S.W.3d 633

JACKSON COUNTY, Missouri, Respondent, v. McCLAIN ENTERPRISES, INC. et al, Defendant

Bill House Excavating Co., Appellant.

No. WD 66025.

Missouri Court of Appeals, Western District.

May 9, 2006.

COPYRIGHT MATERIAL OMITTED

Jeffrey C. Baker and William P. Denning, Overland Park, KS, for Appellant.

Richard E. McLeod, Kansas City, MO, for Respondent.

Steven F. Coronado, Kansas City, MO, for Defendant.

Before RONALD R. HOLLIGER, P.J., HAROLD L. LOWENSTEIN, and ROBERT G. ULRICH, JJ.

ROBERT G. ULRICH, Judge.

Bill House Excavating Co. (Excavating) appeals from the order of the Jackson County Circuit Court overruling its motion to compel arbitration. In its sole point on appeal, Excavating claims the trial court erred in overruling its motion to compel arbitration because a valid and enforceable agreement to arbitrate existed. The order is reversed, and the matter is remanded to the trial court with directions.

Facts

On June 6, 2005, Jackson County filed an action for trespass and conversion against Excavating and McClain Enterprises, Inc. (McClain).¹ The petition alleged that Excavating, as the agent of and at the direction of McClain, entered upon Little Blue Trace Park, property belonging to Jackson County, and removed approximately 73,778 cubic yards of soil from the site, digging a pit approximately two acres in size. The petition further alleged that the removed dirt was used as fill dirt in a housing development owned by McClain. Finally, the petition alleged that neither Excavating nor McClain were authorized by Jackson County to enter upon the land or remove the dirt.

Excavating filed its answer on July 13, 2005, and generally denied the allegations contained in the petition. Excavating's answer also denied that the Jackson County Circuit Court had subject matter jurisdiction over the matter because of an agreement between the parties to submit the matter to arbitration. On July 12, 2005, Excavating filed a motion to compel arbitration and suggestions in support of the motion. Excavating sought to compel arbitration pursuant to section 435.350,² and based upon the acceptance by the parties of the terms contained in an April 19, 2005, letter. The suggestions in support of the motion alleged that, after the dirt had been removed from Little Blue Trace Park, counsel for Jackson County sent a letter to both Excavating and McClain offering to submit the dispute to arbitration and articulating terms. The letter was attached to the suggestions and stated the following:

Dear Sirs:

In an effort to resolve the County's claim against you, for damage done to Jackson County parkland in the Little Blue Park at Saddle Ridge Estates, the County is offering to enter into an agreement under the terms contained in this letter to submit the dispute to binding arbitration before retired Circuit Judge John Moran.

The arbitration process as contemplated will proceed as follows:

1. The County will submit a brief statement of its claim, setting forth all legal causes of action available to us.

2. Each putative defendant will submit a written answer setting forth any legal defenses.

3. Parties will exchange all documents concerning this matter within ten days of the receipt of the answer as contemplated in Federal Rule of Civil Procedure 26.

4. Subsequent to the exchange of documents each party shall have the right to obtain up to five (5) depositions under oath from witnesses or parties to the action. Additional depositions may be obtained upon a showing of necessity within the discretion of Judge Moran.

5. The arbitration meeting shall be held in an open and available public forum accessible to members of the general public, the press, and any interested observers. All documents, exhibits and depositions submitted as evidence in the meeting shall be available to the public.

6. The arbitrator shall prepare written findings of facts, conclusions of law and order pertaining to the following issues in the same manner as a trial before the Court:

A. Each of the County's causes of action;

B. The appropriateness of any defense raised and proven;

C. The calculation of damages necessary to make the County whole;

D. The application of Section 49.490 R.S.Mo. that provides for quadruple damages.

7. Any damages awarded must be paid within 30 days after the decision or Jackson County shall have the right to enforce the arbitrator's award as a judgment of a Court of Law.

If this suggestion is satisfactory, please contact me immediately. If we do not have a signed agreement for binding arbitration under these terms and conditions, within ten days of the date of this letter, we will file a suit fairly soon thereafter.

                                  Sincerely
                                  [Jackson County Counselor]
                

The suggestions in support of the motion further alleged that both Excavating and McClain accepted the offer within ten days; the letters of acceptance were also attached to the suggestions. Excavating argued that, upon acceptance, there was a binding and enforceable agreement to arbitrate.

Jackson County filed suggestions in opposition to the motion to compel arbitration on August 25, 2005. Jackson County claimed that the essential term in the agreement to arbitrate set forth in the April 29, 2005, letter was that retired Circuit Judge John Moran serve as the arbitrator. After the offer was accepted, the parties learned that Judge Moran would not hear the arbitration case. Jackson County asserted that because an essential term of the contract, that Judge Moran serve as arbitrator, could not be met, the contract was unenforceable.

Excavating filed a response to the suggestions in opposition to the motion to compel on August 6, 2005. Excavating asserted that Judge Moran serving as arbitrator was not an essential term of the contract and that the agreement to arbitrate was not conditioned upon Judge Moran's serving as arbitrator. It further stated that when Jackson County learned that Judge Moran would not serve as the arbitrator, Jackson County did not notify the parties that the arbitration could not proceed. Instead, Jackson County continued to discuss the option of using another individual as an arbitrator in the dispute. Attached to the response was a letter from Excavating to both Jackson County and McClain purporting to memorialize a conversation the parties had concerning the use of a substitute arbitrator. The letter stated that counsel for Jackson County was going to consult with the Jackson County legislature to determine whether the legislature was agreeable to using the substitute arbitrator and requested that counsel for Jackson County contact the other parties and inform them whether the legislature approved the substitute arbitrator.

On September 20, 2005, the Jackson County Circuit Court summarily overruled Excavating's motion to compel arbitration. The order did not include findings of fact and conclusions of law. Excavating filed its timely notice of appeal.

Jurisdiction

Jackson County moved to dismiss the appeal. It claimed that the order overruling the motion to compel arbitration was not an appealable final judgment as it was not denominated "judgment" as required by Rule 74.01(a). Excavating's response to the motion to dismiss argued that section 435.440.1 granted the right to appeal from the denial of a motion to compel arbitration, which takes precedence over the necessity of a final judgment. The motion was taken with the case, and briefs were subsequently filed. In its jurisdictional statement, Excavating asserts that overruling its motion to compel arbitration is appealable pursuant to section 435.440.1 and that this court has jurisdiction. Jackson County's jurisdictional statement is comprised of the following sentence: "Respondent agrees with Appellant's jurisdictional statement."

Regardless whether the parties agree that this court has jurisdiction, an appellate court must determine sua sponte whether it has jurisdiction to entertain an appeal. Lake Osage Condo. Ass'n, Inc. v. Prewitt, 179 S.W.3d 331, 335 (Mo.App. S.D.2005). "The right to appeal is purely statutory, and where a statute does not give a right to appeal, no right exists." Dunn Indus. Group, Inc. v. City of Sugar Creek, 112 S.W.3d 421, 427 (Mo. banc 2003). Section 512.020³ governs appeals and states that an appeal is only allowed from a final judgment of the trial court. H.J. Gruy & Assocs., Inc. v. Big E Oil Co., 133 S.W.3d 541, 541 (Mo.App. E.D.2004). "If the order of the trial court was not a final judgment, this Court lacks jurisdiction and the appeal must be dismissed." City of St. Louis v. Hughes, 950 S.W.2d 850, 852 (Mo. banc 1997). The Missouri legislature has defined a "judgment" as "the final determination of the right of the parties in an action." Id. at 853; § 511.020.

The Missouri Constitution empowers the Missouri Supreme Court to "establish rules relating to practice, procedure and pleadings for all courts . . . which shall have the force and effect of law." Hughes, 950 S.W.2d at 853; Mo. Const. art. V, § 5. Pursuant to this provision, the Missouri Supreme Court has adopted rules of civil procedure. Hughes, 950 S.W.2d at 853. Rule 74.01(a)⁴ defines what constitutes a judgment. Id. Rule 74.01(a) states that "[a] judgment is entered when a writing signed by the judge and denominated `judgment' or `decree' is filed." A document not denominated "judgment" is not a final judgment and is not appealable under section 512.020. Hughes, 950 S.W.2d at 853.

Section 512.020 governs appeals generally. Crack Team USA, Inc. v. Am. Arbitration Ass'n, 128 S.W.3d 580, 581 (Mo.App. E.D.2004). Section 435.440.1,⁵ a part of the Missouri Uniform Arbitration Act (MUAA),⁶ specifically governs the appealability of arbitration awards. Crack Team USA, Inc., 128 S.W.3d at 581. It expressly grants the right to appeal orders denying an application to compel arbitration. Whitney v. Alltel Commt'ns, Inc., 173 S.W.3d 300, 306 (Mo.App....