State v. Gillespie

• Decision Date: 08 October 2002
• Docket Number: No. WD 60612.,WD 60612.
• Parties: STATE of Missouri ex rel. MISSOURI HIGHWAY AND TRANSPORTATION COMMISSION, Respondent, v. James Robert GILLESPIE, et al., Defendants, Ryan Ruckman, Appellant, Commerce Bank, N.A., and Agribank, FCB, Respondents.
• Court: Missouri Court of Appeals

86 S.W.3d 459

STATE of Missouri ex rel. MISSOURI HIGHWAY AND TRANSPORTATION COMMISSION, Respondent, v. James Robert GILLESPIE, et al., Defendants Ryan Ruckman, Appellant Commerce Bank, N.A., and Agribank, FCB, Respondents.

No. WD 60612.

Missouri Court of Appeals, Western District.

October 8, 2002.

William D. Farrar, Senior Assistant Counsel, Lee's Summit, MO, for Respondent MHTC.

Joseph R. Borich III, Leawood, KS, for Appellant.

Nicholas K. Robb, Stephen J. Briggs and James H. Counts, St. Joseph, MO, for Respondent, Commerce Bank.

Day Miller, Maysville, MO, for Respondent, Agribank, FCB.

Before ULRICH, P.J., and SPINDEN and EDWIN H. SMITH, JJ.

EDWIN H. SMITH, Judge.

Ryan Ruckman¹ appeals from the judgment of the Circuit Court of Gentry County distributing, pursuant to § 523.053,² the commissioners' award of $115,700 in a condemnation proceeding filed by the Missouri Highway and Transportation Commission (MHTC), condemning, inter alia, a portion of real property owned by the appellant, which was subject to a deed of trust executed by the appellant and his former wife in favor of the respondent, Commerce Bank, N.A. (Commerce), securing a promissory note. In its judgment, the trial court ordered that, pursuant to a condemnation acceleration clause in the deed of trust, Commerce was to receive $96,367.74 of the commissioners' award, representing the then balance due it under the note, with the appellant to receive the balance of the award, $19,332.26, subject to any lawful execution or garnishment, including the garnishment of the respondent, Agribank, FCB (Agribank), issued to satisfy a civil judgment obtained by it against the appellant for approximately $200,000.

The appellant raises two points on appeal. In Point I, he claims that the trial court erred in ordering the distribution of the commissioners' award because in doing so, it failed to comply with the provisions of § 523.053, requiring, inter alia, the court to determine the percentage of the award to which each party having a determinable interest in the condemned property was entitled. In Point II, he claims that the trial court did not, in effect, award him any portion of the commissioners' award and that it was error not to do so because it was against the weight of the evidence, in that the greater weight of the evidence established that the appellant was "entitled to part of the condemnation proceeds to remedy the property to stay in business and that the mortgage holder [Commerce] was still adequately secured."

We affirm.

Facts

On June 8, 2001, the MHTC filed a petition in the Circuit Court of Gentry County to condemn, for the purpose of widening Missouri Highway 136 in Albany, approximately 25% of the appellant's property, which the appellant had leased to a John Deere dealership. The petition, inter alia, named the appellant, Commerce, and Agribank as defendants claiming an interest in the property.

On July 20, 2001, the duly appointed condemnation commissioners assessed an award of $115,700 as net damages for the appropriation of the property. The appellant filed exceptions to the commissioners' report on July 27, 2001. The MHTC filed exceptions on July 30, 2001. On September 14, 2001, after the parties claiming an interest in the subject property were unable to reach an agreement on the distribution of the commissioners' award, Commerce, which held a first deed of trust on the subject property securing a promissory note executed by the appellant and his former wife, filed a motion for distribution of the award, as provided in § 523.053. In its motion, Commerce sought a distribution of the condemnation award equal to the balance then due it on the promissory note. In doing so, Commerce relied on a provision in the deed of trust, which provided that, if any part of the subject property was condemned by eminent domain, Commerce could "at its election require that all or any portion of the net proceeds of the award be applied to the Indebtedness or the repair or restoration of the property."³

Commerce's motion for distribution of the commissioners' award was heard on October 4, 2001. At the hearing the appellant appeared in person and by counsel. The only other defendants appearing were Commerce and Agribank, which appeared by counsel. Commerce presented the testimony of a senior vice president who stated that the amount due on the promissory note secured by the deed of trust, through October 4, 2001, was $95,444.34 and that it was accruing interest at the rate of $24.26 per day. The appellant testified that as a result of the condemnation proceeding he would lose the 25% of his property that fronted on the highway, on which was located the John Deere dealership sign, outdoor lighting, evergreen trees, some parking spaces, and a display area for machinery. He also testified that the loss of the property would make access to the dealership more difficult, requiring that he construct two additional entrances.⁴ As to Agribank, it did not present any evidence; however, counsel stated for the record:

Your honor, our position is yesterday I had the circuit clerk issue a writ of execution in support of a garnishment summons out of a judgment case we have here. And we have a judgment that is approximately $200,000.00 against Mr. Ruckman. We had the sheriff serve Mr. Whitaker as the circuit clerk. Our theory is we have no objection at all to Commerce Bank's motion. In fact, we encourage the Court to sustain that. Our position is now by virtue of the garnishment summons that has been served ordering Mr. Whitaker that any damages the court might give to Ruckman should be paid to Agribank. We have a judgment and ask the garnishment summons be recognized.

On October 18, 2001, the trial court entered its judgment ordering that the commissioners' award be distributed as follows:

IT IS THEREFORE ORDERED, ADJUDGED AND DECREED that the Clerk of the Circuit Court of Gentry County, Missouri shall distribute the proceeds referenced above, paid into this Court, regarding Tract 10 as follows:

1. $96,367.74 to Commerce Bank, N.A 2. The balance of the proceeds to Ryan Ruckman, subject to any lawful execution or garnishment which may affect these proceeds.

IT IS FURTHER ORDERED that Commerce Bank N.A. shall be entitled to 100% of the award as to the first $96,367.74 and that Defendant, Ryan Ruckman will have 100% interest in the balance of said award, said allocation is required by Chapter 523 RSMo.

This appeal followed.

Standard of Review

Our review of the trial court's judgment distributing the condemnation proceeds is governed by Murphy v. Carron, 536 S.W.2d 30, 32 (Mo. banc 1976). Manfield v. Auditorium Bar & Grill, Inc., 965 S.W.2d 262, 266 (Mo.App.1998). "We must affirm the judgment of the trial court unless there is no substantial evidence to support it; it is against the weight of the evidence; or, it erroneously declares or applies the law." Id. (citation omitted).

I.

In Point I, the appellant claims that the trial court erred in ordering the distribution of the commissioners' award because in doing so, it failed to comply with the provisions of § 523.053, requiring, inter alia, the court to determine the percentage of the award to which each party having a determinable interest in the condemned property was entitled. Specifically, the appellant contends that the trial court was required, but failed, in its judgment to set forth the specific percentages of the commissioners' award being distributed to each party of interest, totaling 100%. Section 523.053⁵ governs the distribution of condemnation awards among the parties with a determinable interest in the condemned property. Section 523.053.1 provides that the parties found to have an interest in the condemned property may file either an agreement to distribute the commissioners' award, or if an agreement cannot be reached, a motion petitioning the court for a determination of the percentage of the award to which each of the interested parties is entitled. Where a motion is filed, § 523.053.2 provides:

Within thirty days after the filing of such motion, the court having jurisdiction of said cause shall determine the percentage of the award to which each party having an interest therein is entitled. Any party aggrieved of the determination of interests made by the court shall have the right of appeal therefrom, and the same shall be considered as a final judgment for such purposes.

As to the application of the percentages, once determined by the trial court, 523.053.3 provides:

The respective interests of all parties in the award made as a result of the condemnation action, whether determined by said agreement or by the court, shall be final and shall extend by percentage to any additional compensation awarded or any reduction of the award thereafter made, together with interest, on the trial of exceptions, and said interest established shall be binding on all parties, plaintiff and defendant; provided, that when the determinable interest of any defendant is not related to the difference in the value of the property before and after the taking by condemnation, such share set out in the agreement or the court's finding thereof shall not be affected by any increase or reduction so long as the final award is not less than such interest.

As noted in the facts, supra, the trial court in its judgment ordered that the commissioners' award of $115,700 be distributed as follows:

IT IS THEREFORE ORDERED, ADJUDGED AND DECREED that the Clerk of the Circuit Court of Gentry County, Missouri shall distribute the proceeds [of the condemnation of the appellant's property] referenced above, paid into this Court, regarding Tract 10 as follows:

1. $96,367.74 to Commerce Bank, N.A.

2. The balance of the proceeds to Ryan Ruckman, subject to any lawful execution or garnishment which may affect these proceeds.

IT IS FURTHER ORDERED that Commerce Bank, N.A. shall be entitled to 100% of the award...