Wood & Huston Bank v. Malan

• Decision Date: 13 August 1991
• Docket Number: No. WD,WD
• Citation: 815 S.W.2d 454
• Court: Missouri Court of Appeals
• Parties: WOOD & HUSTON BANK, Respondent, v. Walter Ray MALAN and Carolyn Malan, Appellants. 43668.

Page 454

815 S.W.2d 454

WOOD & HUSTON BANK, Respondent, v. Walter Ray MALAN and Carolyn Malan, Appellants.

No. WD 43668.

Missouri Court of Appeals Western District.

Aug. 13, 1991.

Motion for Rehearing and/or Transfer to Supreme Court

Denied Oct. 1, 1991.

Andrew C. Webb, Sedalia, for appellants.

Charles E. Fowler, III (argued), Kip A. Stetzler, Kansas City, for respondent.

Before NUGENT, P.J., and WASSERSTROM, Senior Judges, and KENNEDY and GAITAN, JJ.

NUGENT, Senior Judge.

Defendants Carolyn Malan and her husband, Walter, appeal from the trial court's entry of summary judgment in favor of plaintiff Wood & Huston Bank on Count I of its petition for judgment on notes signed by the defendants and on Count II seeking foreclosure on their real and personal property, and from the court's judgment in the plaintiff's favor on all three counts of the defendants' counterclaims. We affirm the judgment of the trial court.

On appeal, the defendants raise five points, each alleging error in the trial court's granting of plaintiff bank's motion for summary judgment. First, they argue that the trial court erred in concluding that no genuine issue of material fact exists. Second, the Malans contend that the difference between the amounts they allege they owe the bank and the amount the bank contends they owe creates a genuine issue of material fact. Third, they assert that the alleged fiduciary relationship with the bank, raised in Count I of their counterclaim, creates a genuine issue of material fact. Fourth, the defendants argue that they raised a genuine issue of material fact in Count II of their counterclaim alleging the bank's fraudulent actions involving their encumbering their residence. Finally, they maintain that a genuine issue of material fact arose in Count III of their counterclaim that the bank, without their permission, removed an abstract from their safe deposit box.

For about the twenty years before this action, the Malans banked with plaintiff Wood & Huston Bank and rented a safe deposit box there. From 1983 until 1987, they executed ten promissory notes with the plaintiff, using the proceeds to purchase and maintain mobile homes as rental property. In 1983, the defendants encumbered several mobile homes and other pieces of personal property. That year they also entered into an agreement with a bank officer, James Rosenquist, in which they assigned to the bank the rents from their mobile homes. They opened a "rent account" into which they deposited the rents and upon which Mr. Rosenquist wrote checks for repairs to the units and, most importantly, for payments on their debts to the bank. According to Mr. Malan's deposition testimony, the owner of the trailer park in which the defendants kept their units collected the rent for them from all their tenants, and, eventually, began paying that money, through Mr. Rosenquist, into the rent account.

In August, 1984, the Malans signed a note for $10,500.00, secured by a deed of trust on their residence. In his deposition testimony, Mr. Malan testified that he and Ms. Malan believed the bank simply wanted them to sign a note renewal and that they neither wanted nor intended to encumber their residence. According to Mr. Malan, Mr. Rosenquist would not allow them to read the documents that they signed and said, "Sign the damn note. I ain't got time to fool with you today," and laughed. Further, according to Mr. Malan's deposition testimony, after signing, the couple did not ask to see the documents.

The couple's indebtedness to the bank mounted, and in 1988 it filed suit for judgment against them on the notes and for foreclosure on their real and personal property. The defendants denied the bank's claims and filed three counterclaims. In June, the defendants filed their first request for production of documents. In July, the bank deposed Mr. Malan and in September filed the deposition, along with many documents. On January 23, 1990, the plaintiff delivered its first request for admissions to defendants' counsel. They failed to respond to those requests in compliance with Rule 59.01 of the Missouri Rules of Civil Procedure, that is, within twenty days after service of the requests. They did not object to the requests or attempt to excuse their failure to answer or seek an extension of time within which to answer. On March 9 the plaintiff moved for summary judgment based in part on the defendants' admissions under Rule 59.01. Three days later without seeking or obtaining leave of court to do so, the defendants filed their responses to plaintiff's requests for admissions. On March 22, the court held a hearing on the summary judgment motion.

In their response to the plaintiff's motion for summary judgment, the defendants asserted the "untruth" of the bank's figures in its petition and its motion, but they offered nothing to refute the truth or accuracy of those figures. The defendants alleged that they had insufficient information to either admit or deny the plaintiff's requests for admissions. They reaverred their denial in their answer to the plaintiff's petition, denying the amount the defendant claimed in its petition and in its motion for summary judgment, insisting that they had no way to "ascertain the amount due on the promissory notes." They claimed that, therefore, a genuine issue of material fact remained and precluded entry of summary judgment.

During oral argument to the trial court on the motion for summary judgment, the defendants' counsel stated that the defendants "don't know what the balance is," but they "know it is not" what the bank alleged. The trial judge asked counsel, "All you are saying is whatever they [the bank] say[,] you say it is not, and because you say it is not, then it ought to go to jury trial?" The defendants' counsel argued, "We have figures provided to us by the bank showing those [the bank's] figures are incorrect. So, in our opinion there is a genuine issue as to what the balances on the notes are."

Unfortunately, however, the defendants' response to the motion for summary judgment does not set out those figures. The trial judge characterized the defendants' response to the motion for summary judgment as a mere "general denial" and as insufficient.

During the argument to the trial court, the defendants' counsel asserted that the plaintiff had waived the defendants' default in untimely answering the plaintiff's requests for admissions. The record reveals, however, that the plaintiff exploited the defendants' default throughout the case.

On April 19 the trial court sustained the plaintiff's motion for summary judgment as to the plaintiff's petition and the defendants' counterclaim. The defendants timely moved to vacate the judgment and upon denial of the motion filed a timely appeal.

In their first point on appeal, the defendants contend that they raised a genuine issue of material fact, therefore, the trial court erred generally in sustaining the summary judgment motion.

Rule 74.04, Missouri Rules of Civil Procedure derives from Rule 56, Fed.R.Civ.P., and, provides in part as follows:

(a) For Claimant. At any time after the expiration of thirty days from the commencement of the action or after service of a motion for summary judgment by the adverse party, a party seeking to recover upon a claim, counterclaim, or cross-claim or to obtain a declaratory judgment may move with or without supporting affidavits for a summary judgment in his favor upon all or any part thereof.

Rule 74.04(c) requires that the movant state the grounds for such a motion with particularity. It further provides that:

[t]he judgment sought shall be entered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.

Rule 74.04(e) provides in part that:

[w]hen a motion for summary judgment is made and supported as provided in this rule 74.04, an adverse party may not rest upon the mere allegations or denials of his pleading, but his response, by affidavits or as otherwise provided in this rule 74.04, shall set forth specific facts showing that there is a genuine issue for trial. If he does not so respond, summary judgment, if appropriate, shall be entered against him.

In addressing a summary judgment, an appellate court must review the entire record in the light most favorable to the party against whom the trial court entered judgment. Fisher v. Scott & Fetzer Co., 664 S.W.2d 662, 663 (Mo.App.1984). The trial court must exercise great care in utilizing this remedy. Gal v. Bishop, 674 S.W.2d 680, 682 (Mo.App.1984). It may enter summary judgment where the pleadings, depositions and admissions on file, together with the affidavits, if any, show that no genuine issue of material fact exists and that the law entitles the moving party to a favorable judgment. Ronollo v. Jacobs, 775 S.W.2d 121, 125 (Mo.1989) ¹; Rule 74.04(c). The motion need not rest on unassailable proof. Schwartz v. Lawson, 797 S.W.2d 828, 832 (Mo.App.1990). To overcome a motion for summary judgment, the opposing party may not rest upon mere allegations or denials, but must set forth specific facts that demonstrate the existence of an outstanding genuine issue of material fact. St. Charles County v. Dardenne Realty Co., 771 S.W.2d 828, 830 (Mo.1989). Facts of such probative value as would control or determine the litigation constitute "material facts." Schneider v. Forsythe Group, Inc., 782 S.W.2d 139, 142 (Mo.App.1989). Mere doubt and speculation do not create a genuine issue of material fact. St. Charles County, supra. Rather, the record must demonstrate a factual question that would permit a reasonable jury to return a verdict for the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247, 106 S.Ct. 2505, 2509-10, 91 L.Ed.2d 202 (1986).

As we demonstrate...