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Zafer Chiropractic & Sports Injuries, P.A. v. Hermann

Court of Appeals of Missouri, Eastern District, Second Division

October 18, 2016

ZAFER CHIROPRACTIC & SPORTS INJURIES, P.A., Appellants,
v.
ANDY HERMANN, ET AL., Respondents.

         Appeal from the Circuit Court of Lincoln County Cause No. 15L6-CC00094 Honorable W. Brent Powell

          OPINION

          Colleen Dolan, Judge.

         Wasse Zafer ("Zafer") and Zafer Chiropractic & Sports Injuries, P.A. ("Zafer Chiropractic") (hereafter referred to collectively as "Appellants") appeal the Circuit Court of Lincoln County's judgment on the pleadings in favor of Andy Hermann ("Hermann") and Farmers Insurance Company, Inc. ("Farmers") (hereafter referred to collectively as "Respondents") on claims for (1) breach of contract, (2) tortious interference with a business expectancy, (3) abuse of process, (4) breach of fiduciary duty, and (5) negligence. We affirm the motion court's judgment.

         I. Factual and Procedural Background

         Appellant Zafer Chiropractic was a business registered with the State of Kansas. Appellant Zafer is a resident of Kansas, and he was the sole owner and operator of Zafer Chiropractic. Zafer was only licensed to practice medicine in Kansas, where he treated all of his patients. However, he had patients that lived in Missouri and Kansas. Respondent Farmers is a Kansas insurance company that is licensed to conduct business in Missouri and Kansas. Respondent Hermann was an employee, agent, representative, and investigator of Farmers at all relevant times. Hermann is a resident of Missouri and he worked in an office located in Missouri when he allegedly committed misconduct damaging Appellants. Appellants claim that Farmers trained Hermann to undervalue, deny, and reduce payments owed to insureds.

         Appellants allege that Farmers provided unspecified insureds with personal injury protection coverage and/or medical payments coverage under unspecified automobile insurance policies. Appellants further allege that some of these insureds assigned their rights to insurance payments from Farmers to Appellants in exchange for treatment by executing an assignment of benefits agreement. Appellants allege Farmers and Hermann refused to make payments and/or delayed making payments to Appellants for treatment they provided to Farmers's insureds from January 1, 2002 through March 31, 2006. Additionally, Appellants claim that Respondents made continual attempts to undervalue and deny claims from April of 2006 through the time of this suit. Appellants further allege that Hermann and other unspecified Farmers's employees contacted Hispanic and/or Spanish-speaking patients of Zafer to threaten deportation if they did not help Farmers file complaints against Appellants. Respondents allegedly filed complaints with, and made false statements to, several Kansas criminal and administrative entities about Appellants, including the Kansas Attorney General, the Kansas Department of Insurance, and the Kansas Board of Healing Arts.

         Appellants claim that Respondents' alleged actions caused them to lose business, asserting that they saw a decrease in the number of both new and returning patients. Appellants also pled that Respondents damaged Zafer's general reputation and goodwill with his patients. Consequently, Appellants claim that they became insolvent and "financially destroyed" by December 6, 2010.

         On February 27, 2012, Appellants filed a petition against Respondents in the Circuit Court of Cole County, which was dismissed without prejudice based on forum non conveniens on December 31, 2012. On May 7, 2013, Appellants filed an identical petition against Respondents in the Circuit Court of Jackson County. Appellants then filed their First Amended Petition ("petition") on March 16, 2015, praying for relief under five counts: breach of contract, tortious interference with business expectancy and business disparagement, abuse of process, negligence, and breach of fiduciary duties. On March 26, 2015, Respondents made a motion for judgment on the pleadings and a motion to transfer venue. On July 1, 2015, the entire case was transferred to the Circuit Court of Lincoln County. On December 16, 2015, the court entered an Order and Judgment Granting Respondents' Motion for Judgment on the Pleadings, finding in favor of Respondents and disposing of all counts asserted by Appellants in their petition.

         II. Standard of Review

         A court should only grant a motion for a judgment on the pleadings if the moving party is entitled to judgment as a matter of law based on the face of the pleadings and no genuine issue of material fact exists. In re Marriage of Busch, 310 S.W.3d 253, 259 (Mo. App. E.D. 2010) (citing Madison Block Pharmacy v. U.S. Fidelity & Guaranty, 620 S.W.2d 343, 345 (Mo. banc 1981)). A judgment on the pleadings presents a question of law, accordingly, we review a motion court's decision on a motion for judgment on the pleadings de novo. Sterling Inv. Grp., LLC v. Bd. of Managers of Brentwood Forest Condo. Ass'n, 402 S.W.3d 95, 100 (Mo. App. E.D. 2013).

         Rule 55.05[1] "requires a pleading that sets forth a claim for relief to contain: (1) a short and plain statement of the facts showing that the pleader is entitled to relief and (2) a demand for judgment for the relief to which the pleader claims to be entitled." Sparks v. PNC Bank, 400 S.W.3d 454, 460 (Mo. App. E.D. 2013). Allegations in pleadings are accepted as true, liberally constructed, and viewed in the light most favorable to the pleader. Anderson v. Crawford, 309 S.W.3d 863, 866 (Mo. App. W.D. 2010). Nonetheless, "Missouri rules of civil procedure demand more than mere conclusions that the pleader alleges without supporting facts." Transit Cas. Co. ex rel. Pulitzer Publ'g Co. v. Transit Cas. Co. ex rel. Intervening Employees, 43 S.W.3d 293, 302 (Mo. banc 2001). Plaintiffs must also plead allegations of fact in support of each essential element of the cause sought to be pleaded. Sparks, 400 S.W.3d at 460. Thus, the pleader must include "ultimate facts" of their case in the petition. Id. We disregard conclusions in a petition if they are not supported by facts. Whipple v. Allen, 324 S.W.3d 447, 449-50 (Mo. App. E.D. 2010).

         III. Discussion

         A. Kansas law applies to all of Appellants' substantive claims

         Appellants contend that the motion court erred in applying Kansas law to their substantive claims because these claims have a more significant relationship with Missouri than Kansas. We disagree.

         A forum state applies its own procedural state laws, but it chooses the applicable substantive law based on its own conflicts of law doctrines. Reis v. Peabody Coal Co., 997 S.W.2d 49, 58 (Mo. App. E.D. 1999). Appellants' petition contains two categories of claims: tort claims and contract claims.

         i. Tort Claims

         For conflicts of law related to tort claims, Missouri employs the "most significant relationship" test set forth in Restatement (Second) of Conflict of Laws § 145 (1971).[2] Reis, 997 S.W.2d at 58. Section 145 states:

(1) The rights and liabilities of the parties with respect to an issue in tort are determined by the local law of the state which, with respect to that issue, has the most significant relationship to the occurrence and the parties under the principles stated in § 6.
(2) Contacts to be taken into account in applying the principles of ยง 6 to determine the law applicable ...

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