Lakin v. General American Mutual Holding Co.
| Decision Date | 25 September 2001 |
| Docket Number | WD59030 |
| Citation | 55 S.W.3d 499 |
| Parties | Scott B. Lakin, Director, Department of Insurance, State of Missouri, Respondent v. General American Mutual Holding Company, Defendant; Metropolitan Life Insurance Company, Appellant. WD59030 Missouri Court of Appeals Western District 0 |
| Court | Missouri Court of Appeals |
Appeal From: Circuit Court of Cole County, Hon. Thomas Brown, III
Counsel for Appellant: Lewis E. Melahn
Counsel for Respondent: John C. Craft
Opinion Summary:
This action involves review of a declaratory judgment determining the applicability of an appeals statute found in Missouri's insurance code. The circuit court found in favor of the Director of Insurance, and the insurance company appealed.
Division holds: 1) The insurance code's appeals statute applied to the dispute at hand because, under the facts, no party could have appealed under the general appeals statute, and 2) review of whether Supreme Court Rules conflicted was moot.
This action is for declaratory judgment. The appeal concerns the applicability of section 375.630.4, RSMo 2000 (part of the Insurance Code which sets out a shorter period of time for finality of judgments than as set out in section 512.020, the general statute on finality of judgments), to a judgment confirming a plan of reorganization for General American Mutual Holding Company ("GAMHC"). At the heart of this appeal is the question as to which of two dates a judgment involving the sale of all the stock in a Missouri insurance company in rehabilitation became final. The facts, now set out, are not in dispute; however, the resolution of the legal question of finality renders a meaningful difference in the financial terms of the stock purchase contract.Background and Procedural History
On August 26, 1999, Metropolitan Life Insurance Company ("MetLife") executed a Stock Purchase Agreement in which it agreed to purchase from GAMHC all issued and outstanding shares of GenAmerica Corporation ("GAC"). This agreement was executed in anticipation that GAMHC soon would be placed in rehabilitation. On September 17, 1999, GAMHC was placed in rehabilitation by the Cole County Circuit Court.
On November 10, 1999, the rehabilitation court approved a Plan of Reorganization for GAMHC, and by that judgment specifically approved the sale of GAC to MetLife under the Stock Purchase Agreement (which subsequently was amended twice).
The Stock Purchase Agreement contemplated that the closing of the sale and purchase of the shares "shall be" on the second business day following the date on which all of the conditions set forth in Article IX shall have been satisfied." The date in question is here referred to as the Specified Date.
One condition of Article IX was that "[a]ny approvals or orders required in connection with the reorganization proceeding in order to permit the consummation of the transactions contemplated by this agreement shall have been obtained, and (i) such approvals or orders shall have become final and nonappealable" (emphasis added). The approvals mentioned here were required from various states and countries in addition to Missouri. On Friday, December 10, 1999, the last approval contemplated in Article IX was received (from Canada). Two business days later was December 14, 1999.
On January 6, 2000, MetLife and GAMHC amended the Stock Purchase Agreement and agreed that promptly following the closing of the transaction, buyer and seller would submit to the rehabilitation court for its determination of the Specified Date.
The dispute in the rehabilitation court and here primarily concerns what the correct Specified Date was for the transactions contemplated by the Stock Purchase Agreement. In other words, the question arose as to when the judgment was final. Citing section 512.020, RSMo.,1 the general statute relating to appeals, Appellant MetLife argues that the Specified Date was thirty days after the November 10 Judgment Confirming Plan of Reorganization ("Plan Confirmation Judgment") became final, plus ten days during which any aggrieved party would have to file a notice of appeal, plus two business days thereafter. That would mean the Specified Date was December 23, 1999.
Respondent Director of Insurance2 argues that the Specified Date was December 14, 1999, reasoning that the November 10 judgment became final on November 15, citing section 375.630.4. That provision states that in cases concerning insurance companies, if a finding is in favor of a plaintiff, the decree or judgment becomes final the same as in other civil cases, except that the notice of appeal must be made within five days after the judgment. Thus, Respondent argues that the November 10 judgment was final on November 15, and the last remaining contingency was removed on December 10, 1999 (when the last approval was received from Canada), and thus the Specified Date was two business days later, which was December 14, 1999.
The parties agreed to submit to the rehabilitation court the question of when the Specified Date occurred. The court entered a judgment adopting Respondent's argument. MetLife appealed. Summarized, the questions are whether the rehabilitation court correctly determined the Specified Date and whether section 375.630.4 is in conflict with Rules 81.05(a) and 81.04(a).
At oral argument, this court questioned its jurisdiction because the record did not indicate that MetLife was a party initially or that it had ever become a party. Therefore, after having solicited additional briefing on whether MetLife was a proper party to this case, this court entered an order remanding the case to the rehabilitation court for a decision on whether intervention was appropriate. Additional briefing was solicited because it is the court's duty to examine sua sponte its jurisdiction. Caldwell v. Heritage House Realty, Inc., 32 S.W.3d 773, 777 (Mo. App. 2000). "The right of appeal is created by statute; there is no right to an appeal without underlying statutory authority." Jackson County Bd. of Election Comm'rs v. Paluka, 13 S.W.3d 684, 687 (Mo. App. 2000). The governing statute says that "[a]ny party to a suit aggrieved by any judgment of any trial court in any civil cause ... may take his appeal to a court having appellate jurisdiction." Section 512.020. (emphasis added).
On remand for the limited purpose of permitting intervention, the rehabilitation court ordered intervention effective March 20, 2000. Upon receipt of a supplemental legal file indicating that the rehabilitation court had granted MetLife's motion for intervention, this court now considers the merits of the case. Analysis
I.
Appellant MetLife argues first that the rehabilitation court erred in determining the closing of the transactions completed by the Stock Purchase Agreement occurred on December 14, 1999, because section 375.630 did not apply to the November 10, 1999, Plan Confirmation Judgment. In this point, MetLife makes four arguments: 1) that read in whole and in conjunction with chapter 375, section 375.630 does not render a judgment confirming a plan of reorganization final and non-appealable within five days of entry; 2) that legislative intent indicates that section 375.630 does not apply to a judgment confirming a plan of reorganization; 3) that public policy favors construing section 375.630 so as not to limit the time for appeal; and 4) that concepts of fundamental fairness and due process support limiting the application of section 375.630.
When reviewing a declaratory judgment, the standard of review is the same as other court-tried cases. Guyer v. City of Kirkwood, 38 S.W.3d 412, 413 (Mo. banc 2001). As such, the trial court's decision will be affirmed unless there is no substantial evidence to support it, unless it is against the weight of the evidence, unless it erroneously declares the law, or unless it erroneously applies the law. Id. (quoting Murphy v. Carron, 536 S.W.2d 30, 32 (Mo. banc 1976)). However, review of legal determinations is de novo. Vocational Servs., Inc. v. Developmental Disabilities Res. Bd., 5 S.W.3d 625, 629 (Mo. App. 1999).
"Issues involving the interpretation of statutory language are questions of law, not judicial discretion." Petet v. State, Dept. of Soc. Servs., 32 S.W.3d 818, 822 (Mo. App. 2000). "In cases involving questions of law, this court reviews the trial court's determination independently, without deference to that court's conclusions." Craven v. State ex rel. Premium Standard Farms, Inc., 19 S.W.3d 160, 163 (Mo. App. 2000).
Stated another way, MetLife's first sub-argument under its first point is that a careful reading of 375.630,3 in whole and in conjunction with preceding sections, reveals that section 375.630.4 was intended to apply only to judgments entered in connection with a ruling on the delinquency of the insurer and is limited in its application to the rehabilitator and the insolvent insurer. Under this theory, the appellant would not be bound by the five-day appeal time limitation set forth in section 375.630.4 because MetLife was neither a "plaintiff" nor a "defendant" in the underlying delinquency action as contemplated by the subsection in question.
MetLife reasons that a short appeals time limitation cannot apply to a Plan Confirmation Judgment because only a "plaintiff" or "defendant" would appeal under that section, and the appeal would arise from a delinquency proceeding where the plaintiff was the director of insurance and the defendant was the...
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