Teasdale & Assocs. v. Richmond Heights Church of God in Christ
| Decision Date | 29 May 2012 |
| Docket Number | No. ED96633,ED96633 |
| Parties | TEASDALE & ASSOCIATES, Respondent, v. RICHMOND HEIGHTS CHURCH OF GOD IN CHRIST, Appellant, |
| Court | Missouri Court of Appeals |
Appeal from the Circuit Court of St. Louis County
Honorable Ellen H. Ribaudo
Introduction
Richmond Heights Church of God in Christ ("Church") appeals from the trial court's judgment in favor of Teasdale & Associates ("Teasdale") in an action on account. Church raises several arguments on appeal. First, Church contends the record lacks sufficient evidence that its employee possessed the requisite authority to bind Church on the contract for legal services upon which Teasdale's claim is based. Church also contends insufficient evidence exists that the legal fees charged were reasonable, or that Teasdale demanded payment for the unpaid debt. Next, Church suggests Teasdale was precluded from pursuing an action against Church for the underlying debt because Teasdale could have recovered from the employee directly. Finally, Church alleges the trial court erroneously admitted and improperly considered evidence of Church's bylaws. We affirm the trial court's judgment because the record contains substantial evidence that Hunt, as president of Church, possessed the authority to enter into the feeagreement with Teasdale, and that the legal fees charged for the services rendered by Teasdale were reasonable. We further find that Church, as a principal, was a proper party to the lawsuit and that the trial court did not err in admitting Church's by-laws into evidence.
Factual and Procedural History
In 2008, parishioners of Church filed a petition against Church's pastor, James Hunt ("Hunt") seeking to enjoin Hunt from selling real property owned by Church. Hunt sought Teasdale's legal services to defend against the suit. Hunt entered into a contract with Teasdale wherein Teasdale agreed to provide legal services to Hunt individually and as president of Church, based upon an established fee agreement. The fee agreement included Church as a party to the contract. Church was responsible for the payment of legal fees rendered by Teasdale, which would be paid for its services out of the proceeds from the sale of Church's real property. Hunt signed the fee agreement individually, and again as President of Church. Church was added as a defendant. The parties eventually settled and dismissed that action.
Teasdale subsequently filed this action against Church seeking payment of legal fees accrued during the previous lawsuit. Teasdale averred that Hunt entered into the fee agreement on behalf of Hunt and Church, and that Church was liable for payment of the legal services rendered by Teasdale under an agency theory. Church argued that Hunt lacked authority to bind Church to any contract for legal services rendered in the original lawsuit. After a bench trial, the trial court entered judgment for Teasdale. Although the trial court did not enter specific findings of fact, the trial court's judgment reflects a finding that Hunt acted with the authority to bind the Church to the fee agreement. Church now appeals.
Points on Appeal
Church asserts multiple points of error. Church's first, second, and fourth points on appeal relate to Church's claims that insufficient evidence exists to support the trial court's judgment. In its first point, Church argues that there was insufficient evidence of an agency relationship between Hunt and Church. In its second and fourth points, Church argues a lack of sufficient evidence that Teasdale served a demand for payment upon Church, and that the underlying legal fees were reasonable. In its third point on appeal, Church contends that the trial court erred in admitting into evidence a document that Hunt offered as Church's bylaws. In its fifth and final point on appeal, Church argues that the trial court erred in denying its motion for a new trial because Teasdale could have obtained a judgment against Hunt rather than Church.
Standard of Review
We will affirm the judgment of the trial court in a court-tried case unless the judgment is against the weight of the evidence, no substantial evidence exists to support it, or the trial court misapplied or erroneously declared the law. Murphy v. Carron, 536 S.W.2d 30, 32 (Mo. banc 1976). Because the trial court did not make specific findings of fact or conclusions of law, "we consider all facts as having been found in accordance with the result reached by the trial court." K & G Farms v. Monroe County Serv. Co., 134 S.W.3d 40, 43 (Mo. App. E.D. 2003).
We review a trial court's ruling as to the admission of evidence for an abuse of discretion. State v. Madorie, 156 S.W.3d 351, 355 (Mo. banc 2005). A trial court abuses its discretion when it makes a ruling that is "clearly against the logic of the circumstances and is so unreasonable as to indicate a lack of careful consideration." State v. Kemp, 212 S.W.3d 135, 145 (Mo. banc 2007). However, even if we find an abuse of discretion, we will not reverse unless we also find that the trial court's error is "so prejudicial that it deprived the defendant of afair trial." Id. Error is not prejudicial unless there is a "reasonable probability that the trial court's error affected the outcome of the trial." Id. (internal citation omitted).
Discussion
Church's first, second, and fourth points each assert that the judgment of the trial court in favor of Teasdale was not supported by sufficient evidence.
The present case concerns an action on account. In an action on account, the plaintiff has the burden of demonstrating that (1) the defendant requested the plaintiff furnish the services at issue, (2) the plaintiff accepted the defendant's offer by furnishing such services, and (3) the charges were reasonable. K & G, 143 S.W.3d at 43. Church claims that insufficient evidence exists to support the first and third elements of Teasdale's action on account. We address each element and Church's argument in turn.
To satisfy the first element of Teasdale's prima facie case, sufficient evidence must exist from which the trial court could find that Church requested the legal services Teasdale provided to defend the original action. See K & G, 143 S.W.3d at 43. Church is a non-profit corporation organized and registered in Missouri. The first element of Teasdale's action is satisfied if there is sufficient evidence that Church requested Teasdale's legal services by and through its agent Hunt.
Whether a party was an agent during a given transaction is a mixed question of fact and law that is highly dependent upon the trial court's credibility determinations and assessment of the evidence. Major Saver Holdings, Inc. v. Education Funding Group, LLC, 350 S.W.3d 498, 507 (Mo. App. W.D. 2011), citing State ex rel. Ford Motor Co. v. Bacon, 63 S.W.3d 641, 642(Mo. banc 2002). We will defer to the trial court's opportunity to weigh the evidence and reach specific factual findings unless we are of the firm belief that the trial court's conclusions are wrong. See Id.
An agency relationship requires authority of the agent to bind the principal. If an agent has authority to act, the principal will be bound by contracts the agent enters into on behalf of the principal. Bach v. Winfield-Foley Fire Protection Dist., 257 S.W.3d 605, 608 (Mo. banc 2008). A corporation is an artificial being, and may therefore act only through its agents. Sutherland v. Sutherland, 348 S.W.3d 84, 92 (Mo. App. E.D. 2011). The power of corporate officers to bind their corporation in contract ordinarily rests upon such officers' actual or apparent authority. Id. at 92-93.
Actual authority arises from statutes, articles of incorporation, bylaws, and other specific authority granted by the board of directors. Holtmeier v. Dayani, 862 S.W.2d 391, 401 (Mo. App. E.D. 1993); Section 351.306.1 The president of a corporation also has inherent authority to transact, without special resolution from the board of directors, all acts of an ordinary nature which are incident to the president's office by usage or necessity, and to thus bind the corporation. Holtmeier, 862 S.W.2d at 401. Conversely, a president does not have the inherent authority to perform acts which are outside the ordinary nature of the duties of that office, and a president may only perform such acts after special approval of the board of directors. Molasky Enterprises, Inc. v. Carps, Inc., 615 S.W.2d 83, 87 (Mo. App. E.D. 1981) ().
After reviewing the record, we find that the record contains sufficient evidence that Hunt had actual authority to bind Church to the relevant fee agreement. Section 351.360 provides:
All officers and agents of the corporation, as between themselves and the corporation, shall have such authority and perform such duties in the management of the property and affairs of the corporation as may be provided in the bylaws, or, in the absence of such provision, as may be determined by resolution of the board of directors.
Section 351.360 thus statutorily grants officers actual authority to the extent that the same authority is granted under the corporation's bylaws.
The record contains evidence that Church's bylaws granted Church's president, Hunt, actual authority to enter into the fee agreement on Church's behalf. Teasdale presented testimony that Church's bylaws gave Church's president the power to exercise or delegate the execution of binds, mortgages, or other contracts on behalf of Church. Specifically, Douglas Teasdale read Church's bylaws into the record at trial. Although the trial exhibit which purported to be Church's bylaws subsequently was granted limited admission into...
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