Nooney v. NationsBank, N.A.

• Decision Date: 27 July 1999
• Docket Number: No. 75202,75202
• Citation: 996 S.W.2d 783
• Parties: John J. NOONEY, Appellant, v. NATIONSBANK, N.A., Respondent.
• Court: Missouri Court of Appeals

Page 783

996 S.W.2d 783

John J. NOONEY, Appellant, v. NATIONSBANK, N.A., Respondent.

No. 75202.

Missouri Court of Appeals,

Eastern District,

Division Four.

July 27, 1999.

Herzog, Crebs & McGhee, LLP, Peter W. Herzog, Michael A. Vitale, Jennifer J. Herner, St. Louis, for appellant.

Lewis, Rice & Fingersh, L.C., Joseph J. Trad, Robert J. Will, St. Louis, for respondent.

Before HOFF, P.J., GARY M. GAERTNER, J., and RHODES RUSSELL, J.

PER CURIAM.

John J. Nooney ("appellant"), appeals the judgment of the Circuit Court of St. Louis County dismissing his claims against respondent, NationsBank, N.A. ("Bank"), for aiding and abetting breach of fiduciary duty and commission of acts of oppression, declaratory judgment, conspiracy to defraud, conspiracy to transfer in fraud of creditors, and tortious interference with creditors' rights. ¹ We dismiss the appeal without prejudice.

This appeal arises out of a long and complex factual and procedural history. A general overview, based on the allegations contained in appellant's second amended petition, follows: appellant is a former officer and director of defendant Nooney Company ("Nooney Company"). In general, Nooney Company and its various related affiliate companies are engaged in the real estate industry.

Appellant states that at all relevant times herein, the officers and directors of Nooney Company were Greg Nooney, Patricia A. Nooney-Byrne ("Patricia Nooney") and Patrick A. Byrne ("Patrick Byrne"). Greg Nooney, also a defendant in this case, but not a party to this appeal, is appellant's brother. At all times relevant to this lawsuit, Greg Nooney was an officer and director of Nooney Company and Nooney Krombach and by virtue of appellant's irrevocable proxy to him, ² was the controlling shareholder of Nooney Company. Patricia Nooney, also a defendant in this case, but not a party to this appeal, is Greg Nooney's daughter. At all times relevant to this lawsuit, Patricia Nooney was an officer and director of Nooney Company and defendants NK Development Company, L.L.C. ("NK Development") and Nooney Krombach. Patrick Byrne, also a defendant in this case, but not a party to this appeal, is the husband of Patricia Nooney and son-in-law of Greg Nooney. At all times relevant to this lawsuit, Patrick Byrne was an officer and director of Nooney Company and defendants NK Development and Nooney Krombach.

Defendant Bank is a national banking association with offices located in the St. Louis metropolitan area. According to appellant's second amended petition, Bank and its predecessor, Boatmen's Bancshares, Inc. ("Boatmen's"), ³ or affiliates thereof, have transacted business from which this cause of action arises and committed the torts alleged therein. ⁴

Appellant alleges in his second amended petition that on approximately May 17, 1992, he and Greg Nooney, Nooney Company and Nooney Krombach, as well as other parties, entered into an agreement ("May 1992 Agreement"), whereby, inter alia, appellant resigned as an officer and director of Nooney Company and its subsidiaries, thus leaving Greg Nooney in control of said corporations. Pursuant to this agreement, Greg Nooney, Nooney Company and its subsidiaries agreed to certain obligations intended to benefit appellant as the fifty percent shareholder of Nooney Company. Subsequently, on approximately December 31, 1992, a series of agreements to augment and, in some cases, modify the terms of the May 1992 Agreement were executed ("December 1992 Agreements").

On December 1, 1992, an agreement was executed by Greg Nooney and his family, appellant and his family, Nooney Company, subsidiary, affiliated and related companies and partnerships of Nooney Company ("Nooney Company affiliates") and Bank to restructure the debt of Nooney Company and the Nooney Company affiliates ("1992 Master Modification Agreement").

According to appellant's second amended petition, after the 1992 Agreements were solidified, Greg Nooney, as controlling shareholder or together with his fellow officers and directors, wrongfully caused Nooney Company to forgive hundreds of thousands of dollars of Greg Nooney's own personal debt to it. Appellant asserts Bank became aware of said debt forgiveness and had a right to call a default and request reinstatement of the debt under the 1992 Master Modification Agreement, but Bank did nothing.

On April 24, 1996, after a jury trial, appellant was awarded a $685,000.00 judgment against Nooney Company for an indemnification matter. Said judgment has been affirmed by this court, ⁵ but allegedly remains unpaid. On May 1, 1996, Nancy Nooney and Deborah N. Speier, appellant's daughters, were awarded a judgment against Greg Nooney. This judgment has also been affirmed by this court, ⁶ but also allegedly remains unpaid.

Appellant further alleges shortly after the aforementioned judgments were entered, between May 1, 1996 and May 6, 1996, Greg Nooney defaulted on a personal loan to Bank, despite resources available to him. On approximately May 9, 1996, Greg Nooney met with Bank regarding his default and the entry of the aforementioned judgments. At that meeting, appellant alleges Bank requested the unliened assets of Greg Nooney, the Nooney Company and the Nooney Company affiliates. Allegedly, this was to prevent a "change in control" of Nooney Company and the Nooney Company affiliates arising from the aforementioned judgments. Appellant alleges a proposal to offer him a reduced amount of his judgment was discussed at this meeting, but said offer was never made.

Appellant further alleges that on July 9, 1996, Bank called a default on an October 1995 transfer by Greg Nooney to his wife, of a note receivable from Nooney Company. Bank allegedly never asked Greg Nooney to recover said note, rather it asked for and collected additional unliened assets from Greg Nooney and Nooney Company. On July 15, 1996, Nooney Krombach allegedly missed a payment on its $2,500,000.00 note to Bank, despite resources purportedly available to it.

Appellant alleges that as garnishments on the aforementioned judgments were filed and served on Nooney Company and Nooney Company affiliates, Greg Nooney delivered these garnishments to Bank. Moreover, appellant alleges that under the guise of the aforementioned "orchestrated defaults", Bank "collected the garnished assets from [Greg Nooney], Nooney Company and Nooney Company affiliates with the purpose of avoiding those garnishments." According to appellant, Bank readvanced funds to Greg Nooney at least once, who then deposited them in his wife's account, thus avoiding the garnishments.

Also, as explained in the second amended petition, in or after March 1997, Greg Nooney transferred a portion of his interest in each of the publicly held Nooney Company-affiliated partnerships to his daughter's company, PAN, Inc. According to appellant, while Bank became aware of this transfer and had a right to call a default and demand cancellation of said transfer pursuant to the 1992 Master Modification Agreement, it did nothing.

Appellant alleges on approximately August 25, 1997, Greg Nooney allegedly initiated and approved indemnification by Nooney Company of his personal indebtedness in excess of $1,500,000.00. Subsequently, purportedly with Bank's knowledge and approval, CGS Real Estate Company, Inc. ("CGS"), as part of its asset purchase (described infra ), assumed Greg Nooney's personal aforementioned indebtedness.

Appellant further states that on approximately August 28, 1997, Nooney Real Estate and Nooney Krombach executed a Master Agreement, under which Nooney Real Estate was to acquire all of the assets of Nooney Krombach ("1997 Master Agreement"). Generally, pursuant to the 1997 Master Agreement, inter alia, Nooney Real Estate and/or CGS were to acquire substantially all of the assets of various Nooney Company affiliates, including some management agreements, as well as various general and limited partnership interests owned by Nooney Company and its subsidiaries. Also under the 1997 Master Agreement, CGS was to assume personal indebtedness of Greg Nooney in exchange for his general partner interests in certain Nooney-affiliated partnerships and Greg Nooney was to have his assumed indebtedness on various other obligations released. Additionally, Greg Nooney, Patricia Nooney and Patrick Byrne were to enter into five-year employment contracts with Nooney Real Estate. Also, Greg Nooney was to be named a member of the Board of Directors of CGS and Chairman of the Board of Directors of Nooney Real Estate, and Patricia Nooney was to be named President of Nooney Real Estate.

Appellant further alleges as part of the transaction between Nooney Krombach, Nooney Real Estate and CGS, Bank agreed to release at least some of the collateral that was formerly pledged to secure Nooney Company's indebtedness to Bank. According to appellant, Bank also agreed to release Greg Nooney from some of his guarantees. Appellant asserts in his second amended petition that "[Bank] has admitted that the CGS transaction could not have gone forward without its substantial participation and consent.... In fact, [Bank] was involved in every step of the negotiation process."

On approximately October 28, 1997, appellant filed an action for a temporary restraining order to enjoin the closing of the transactions agreed to in the 1997 Master Agreement. Bank, not yet a named party, attended the hearing to oppose the temporary restraining order. The temporary restraining order was not granted; but the court ordered that all excess cash proceeds from the CGS transactions be delivered into escrow. According to appellant, no such proceeds were ever delivered. On approximately November 6, 1997, the transactions agreed to in the 1997 Master Agreement closed.

According to appellant's second amended petition, with the transfer of almost all of the assets of certain of the Nooney Company affiliates in accordance with the 1997 Master Agreement,...