Mika v. Central Bank of Kansas City

Decision Date30 May 2003
Docket NumberNo. WD 61116.,WD 61116.
Citation112 S.W.3d 82
PartiesJohn F. MIKA, et al., Appellants, v. CENTRAL BANK OF KANSAS CITY, et al., Respondents.
CourtMissouri Court of Appeals

Theodore C. Beckett, III, Kansas City, MO, for appellants.

David W. White, Terry J. Brady, Kansas City, MO, for respondents.

Before JOSEPH M. ELLIS, Chief Judge, EDWIN H. SMITH, Judge and VICTOR C. HOWARD, Judge.

JOSEPH M. ELLIS, Chief Judge.

Appellants, John Mika, Brigid Mika and Venus Automotive, Inc., owned two parcels of land in Kansas City, Missouri. Respondent Central Bank of Kansas City ("Central Bank") was the holder of certain promissory notes secured by the properties. After Appellants stopped paying the amounts due on the notes, Central Bank initiated foreclosure proceedings. Central Bank purchased both properties at the foreclosure sale and sold one of the properties to Respondent University Health Services ("UHS"). Following this sale, Appellants filed a petition against Central Bank, UHS, and several officers and board members of Central Bank and associates of UHS. Appellants alleged that Respondents conspired to fraudulently induce Appellants to stop servicing the debt on the notes in order to effectuate a sale of Appellants' property to UHS. The trial court granted summary judgment for Respondents, holding that Appellants' claims were barred by the Statute of Frauds. This appeal follows.

When reviewing the grant of summary judgment, we view the record in the light most favorable to the nonmoving party and accord them the benefit of all reasonable inferences. Dwyer v. Meramec Venture Assocs., L.L.C., 75 S.W.3d 291, 293 (Mo. App. E.D.2002). Viewed in this manner, the record reveals that Appellants owned two properties in Kansas City, Missouri: 1615 Independence Avenue and 615 Highland in the northeast part of Kansas City, Missouri ("Independence Avenue property") and 1316, 1318, and 1320 Grand Avenue (the "Grand Avenue property").

John Mika was the president of Venus Automotive, which was dissolved in November 1996. Appellants had a longstanding business relationship with Central Bank. Steven Morgan, Vice President of Central Bank and a board member, was Appellants' primary contact at the bank. Central Bank was the holder of certain promissory notes for $375,000 and $65,000 that were secured by deeds of trust on both the Independence Avenue and Grand Avenue properties. Venus Automotive had financial difficulties and filed for bankruptcy in May 1998.

In November 1998, UHS made an offer to purchase the Independence Avenue property for $450,000. Mika refused and made a counteroffer of $600,000. UHS made a counteroffer of $500,000. Mika did not accept the offer.

In December 1998, Appellants entered into a real estate contract with Joseph Saitta for the sale of the Grand Avenue property for $200,000. Saitta secured financing, and Appellants wanted to sell the land at the agreed price; however, the title search process revealed several liens concerning the property, and Saitta informed the Appellants that these liens would have to be resolved before the sale could be completed.

Appellants discussed the title issues with Morgan, and he suggested that a "friendly foreclosure" was the appropriate way to resolve the title issues and complete the sale. Morgan suggested that if Appellants stopped servicing the indebtedness on the notes, Central Bank would foreclose and take title to the properties. Central Bank would then complete the sale of the Grand Avenue Property to Saitta for $200,000 and would sell the Independence Avenue property back to Appellants for the amount Central Bank paid for the properties at the foreclosure sale, less the $200,000 received from Saitta.

As part of the agreement, Appellants were to secure financing to buy the Independence Avenue property back from Central Bank. Had it not been for the "friendly foreclosure" agreement, Appellants would have continued paying the amounts due on the notes or obtained other arrangements to prevent foreclosure. Morgan denied ever proposing such an agreement.

Appellants stopped paying the amounts due on the notes, and there was a foreclosure sale in April 1999. At the sale, Central Bank purchased both properties for about $516,000.

At a May 19, 1999 meeting of the board of directors, Central Bank approved the sale of the Grand Avenue property to Saitta for $200,000 and the sale of the Independence Avenue property to UHS for $500,000. During the time of these transactions, the board of directors of Central Bank included Dana and Morgan. The board also included Karen Pletz, president of UHS, Chief Executive Officer of the University and a member of the Board of Trustees of the University; and Ross J. Cascio, the sole owner of the Victor Ross Realty Company, the realtor involved in the sale of the real property in question. In addition, James Hoffine, who was involved in the acquisition of the property, was the Vice-President for Finance and Administration for UHS as well as the President and a board member of Independence Avenue Development ("IAD"), a not-for-profit corporation that supports the University in acquiring property. Cascio and Pletz abstained from voting on the sale of the property to UHS.

On May 26, 2000, Appellants filed their second-amended petition against Central Bank, UHS, IAD, Morgan, Dana, Pletz, Cascio and Hoffine. Appellants raised the following claims in their petition: Count I—Common Law Fraud; Count II—Negligent Misrepresentation; Count III— Breach of Contract; Count IV—Specific Performance; Count V—To Set Aside Foreclosure; and Count VI—Civil Conspiracy. Subsequently, Respondents filed their separate answers. On August 20, 2001, Respondents filed motions for summary judgment. On September 10, 2001 Appellants filed responses in opposition to motions for summary judgment. On December 11, 2001, the trial court entered its order granting summary judgment in favor of all Respondents. On February 29, 2002, the trial court denied Appellants' motion to reconsider. This appeal follows.

Appellate review of a summary judgment is essentially de novo. ITT Commercial Finance Corp. v. Mid-America Marine Supply Corp., 854 S.W.2d 371, 376 (Mo.banc 1993). When considering appeals from summary judgments, the Court will review the record in the light most favorable to the party against whom judgment was entered. Id. To prevail on a motion for summary judgment, the movant must establish that there are no genuine issues of material fact and that the movant is entitled to judgment as a matter of law. Id. at 377.

The criteria on appeal for testing the propriety of summary judgment are no different from those which should be employed by the trial court to determine the propriety of sustaining the motion initially. ITT at 376. The propriety of summary judgment is purely an issue of law. Id. As the trial court's judgment is founded on the record submitted and the law, an appellate court need not defer to the trial court's order granting summary judgment. Id.

Glasgow v. Cole, 88 S.W.3d 114, 115 (Mo. App. E.D.2002).

Respondents claimed in their motions for summary judgment that Appellants' claims were barred by the credit agreement statute of frauds, § 432.045.1 Respondents UHS, Hoffine and IAD also claimed that Appellants' claims were barred by the statute of frauds for the sale of real property, § 432.010.

In its judgment, the trial court made the following findings:

1. The plaintiffs had an ongoing business relationship with Central Bank. That relationship involved the borrowing of moneys that were secured by the property in question.

2. There clearly exists a genuine issue of fact as to whether or not there was a friendly foreclosure agreement. To be sure, there is evidence that such oral representations did occur. The bank and Mr. Morgan deny the same. This evidence includes not only the testimony of the plaintiffs, but at least indirect testimony from other individuals that had contact with the plaintiffs. In particular, the moving papers suggests [sic] that the plaintiffs had told several other business associates or creditors of this friendly foreclosure agreement.

3. The friendly foreclosure agreement was not the subject of any writing.

4. There is no direct evidence that anyone other than Morgan and possibly Mr. Dana had knowledge of this proposed or alleged friendly foreclosure agreement.

5. The plaintiffs John and Brigid Mika signed a credit agreement with Central Bank that included the following language in bold-face 10-point type in paragraph 12:

Oral agreements or commitments to loan money, extend credit or to forbear from enforcing repayment of a debt including promises to extend or renew such debt are not enforceable. To protect you (borrower) and us (lender) from misunderstanding or disappointment, any agreements we reach covering such matters are contained in this writing, which the complete and exclusive statement of the agreement between us, except as we may later agree in writing to modify it.

The trial court also determined that the "friendly foreclosure" agreement constituted a financial accommodation pursuant to § 432.045, the statute of frauds for credit agreements.

The court went on to conclude that even if the count of civil conspiracy was not barred by the statute of frauds, "there is simply no evidence that defendants Pletz, Hoffine, Cascio, UHS and IAD had knowledge of the friendly foreclosure agreement, nor that the purpose of the agreement was to defraud the plaintiffs of the property." Accordingly, the court determined that summary judgment was appropriate on the conspiracy counts as to those defendants, but not defendants Morgan, Dana, and Central Bank.

The trial court also indicated that it believed that Respondents' conduct might warrant the application of an equitable exception to the...

To continue reading

Request your trial
39 cases
  • Pease v. Wachovia SBA Lending, Inc.
    • United States
    • Maryland Court of Appeals
    • 21 Octubre 2010
    ...based upon an erroneous belief that Missouri's credit agreement statute barred the debtors' claims. See Mika v. Cent. Bank of Kansas City, 112 S.W.3d 82, 90 (Mo.Ct.App.2003). The court explained that a fraud exception to the general statute of frauds had existed for over one hundred years i......
  • Wiley v. Homfeld, WD 69560
    • United States
    • Missouri Court of Appeals
    • 20 Abril 2010
    ...in effect "unless a statute clearly abrogates the common law either expressly or by necessary implication." Mika v. Cent. Bank of Kansas City, 112 S.W.3d 82, 90 (Mo.App. W.D.2003) (internal quotation omitted). If the legislature, in reinstating remittitur by statute, had intended to change ......
  • Sovereign Bank v. Licata
    • United States
    • Connecticut Court of Appeals
    • 18 Agosto 2009
    ... ... See Mika v. Central Bank of Kansas City, 112 S.W.3d 82, 91-92 (Mo.App. 2003) ... ...
  • Topchian v. Jpmorgan Chase Bank, N.A.
    • United States
    • U.S. Court of Appeals — Eighth Circuit
    • 28 Julio 2014
    ...three broad categories: perpetration of fraud, partial or full performance, and promissory estoppel. Mika v. Cent. Bank of Kansas City, 112 S.W.3d 82, 88–89 (Mo.Ct.App.2003). At a minimum, Topchian has alleged the partial performance of his obligations under the Agreement and thus has alleg......
  • Request a trial to view additional results

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT