Court of Appeals of Missouri, Southern District, First Division
FROM THE CIRCUIT COURT OF HOWELL COUNTY Honorable Truman L.
W. SHEFFIELD, C.J.
Land and Cattle Company, Inc. ("Action Land")
appeals from the trial court's entry of summary judgment
for Bank of Houston ("Bank") on Bank's suit to
enforce two promissory notes. Action Land claims the trial
court erred in entering summary judgment for Bank because the
contracts which created the promissory notes were illegal and
unenforceable under Section 362.170, which sets the lending
limits for financial institutions in Missouri, and Section
362.171, which criminalizes the actions of certain banking
officials and employees who participate in making such
loans. Action Land's claim is without merit
because Section 362.170 and Section 362.171 do not, as a
matter of law, provide a defense to borrowers. We affirm the
trial court's judgment.
and Procedural Background
statement of facts is drawn from the parties' summary
judgment documents, viewed in the light most favorable to
Action Land because Action Land was the non-moving party.
See Great Southern Bank v. Blue Chalk Const., LLC,
497 S.W.3d 825, 827 (Mo. App. S.D. 2016).
2009, Action Land executed two promissory notes in favor of
Bank, one for $500, 050 and another for $800, 050. These
notes were signed by John Sutton ("Mr. Sutton") in
his capacity as president of Action Land. Neither note was
paid, and, on January 16, 2012, Bank sent Action Land a
notice of default and acceleration for each note. Action Land
continued to refuse payment.
October 15, 2013, Bank sued Action Land seeking enforcement
of the promissory notes. Action Land answered, denying the
allegations in the petition and raising as an affirmative
defense the argument that the promissory notes were
"illegal and unenforceable because [Bank] exceeded the
legal lending limits imposed by Missouri law."
thereafter moved for summary judgment. In its statement of
uncontroverted material fact, Bank included the facts
regarding the execution and nonpayment of the notes as
previously stated and supported those statements by providing
the notes, the notices of default, and an affidavit made by
Bank's president. In its response to Bank's motion
for summary judgment, Action Land admitted Bank made two
separate loans of $500, 050 and $800, 050 to Action Land.
Action Land denied that it had failed to pay the notes, but
the affidavit supporting that denial was not included in the
record on appeal and Action Land makes no argument on
appeal that the notes have been repaid.
Land's response to Bank's motion for summary judgment
also included several additional facts. Bank admitted it made
additional loans totaling $600, 000 to a company called
Cheyenne Enterprises, Inc. ("Cheyenne"). Bank also
admitted that its lending limit under Section 362.170 was $1,
497, 250. Bank denied, with appropriate references to
exhibits and discovery, Action Land's assertion that Mr.
Sutton was a principal of Cheyenne.
trial court entered summary judgment for Bank. Action Land
sole point on appeal, Action Land claims "[t]he trial
court erred in granting summary judgment to [Bank] because
the contracts entered into between the parties are illegal
and unenforceable, in that [Bank] committed a felony by
violating RSMo § 362.171 by lending in excess of its
limits." To support this claim, Action Land asserts the
loans to itself and to Cheyenne had to be aggregated because
Mr. Sutton was a principal of both enterprises. Action
Land's argument is without merit because, even if Bank
violated its lending limits (an issue we need not and do not
decide), that fact would not release Action Land from its
obligations under the notes.
review of a trial court's grant of summary judgment is
de novo. Great Southern Bank, 497 S.W.3d at
828. "The criteria on appeal for testing the propriety
of summary judgment are no different from those which should
be employed by the trial court to determine the propriety of
sustaining the motion initially." Id.
"Summary judgment will be upheld on appeal if: (1) there
is no genuine dispute of material fact, and (2) the movant ...