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Geier v. Sierra Bay Development, LLC

Court of Appeals of Missouri, Southern District, Second Division

June 27, 2017

RONALD P. GEIER and PAULA GEIER, Plaintiffs-Respondents,
v.
SIERRA BAY DEVELOPMENT, LLC, Defendant, and SIERRA BAY AT THE LAKE, LLC, Defendant-Appellant.

         APPEAL FROM THE CIRCUIT COURT OF CAMDEN COUNTY Honorable Stan Moore

          GARY W. LYNCH, P.J.

         Ronald and Paula Geier (collectively, "the Geiers"), husband and wife, sued Sierra Bay Development, LLC ("Development"), Bank Star One, [1] and Sierra Bay at the Lake, LLC ("the Lake"), [2] for specific performance of a real estate contract ("the Contract"), reformation of the condominium declarations ("the Declaration") of Sierra Bay Condominiums (the "Property"), and attorney's fees. The Geiers contend that their rights to a boat slip and other condominium amenities were not included in the Declaration or conveyed to them as required by the Contract. The trial court reformed the Declaration to reflect the Contract obligation and awarded the Geiers attorney's fees. The Lake contends that the trial court's judgment was erroneous because: (1) the Geiers "did not plead facts to support reformation of the Declaration based on fraud or mutual mistake[;]" (2) "no evidence was presented to show that the terms of the Declaration did not accurately reflect the intention of the Developer and the unit purchasers[;]" (3) "the unit owners at Sierra Bay were not joined as parties to the lawsuit even though the reformation of the Declaration affected their property rights[;]" and (4) "there was no statute or contract authorizing the award of attorney's fees against [the Lake] and the fees were not necessary to balance the benefits." We find merit in the Lake's fourth point and reverse the award of attorney's fees, but we affirm the trial court's judgment in all other respects.

         Standard of Review

         "On review in a court-tried case, an appellate court will affirm the circuit court's judgment 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." Ivie v. Smith, 439 S.W.3d 189, 198-99 (Mo. banc 2014). That standard applies to review "in all types of court-tried cases." Id. at 199 (footnote omitted). "We are to credit evidence and reasonable inferences that support the judgment; disregard contrary evidence and inferences; and defer to the trial court's determination of contested facts." Whispering Oaks Farms, LLC v. Lebanon Livestock Auction S & T, LLC, 466 S.W.3d 717, 719 (Mo.App. 2015). Here, the trial court issued findings of fact, so we draw our facts from the trial court's findings that are not challenged on appeal.

         Factual and Procedural Background

         In September of 2005, the Geiers sold the Property to Development in anticipation of the development of Sierra Bay Condominiums. Under the Contract, the Geiers were to receive under the anticipated condominium declaration a boat slip and other condominium amenities.[3]When Development recorded the Declaration on November 16, 2006, the Declaration was silent as to any such rights of the Geiers. On March 19, 2007, Bank Star One lent Development funds secured by a deed of trust on the Property. Bank Star One foreclosed on the Property on March 9, 2010. The Geiers filed this lawsuit on September 2, 2011, and a Notice of Lis Pendens on September 7, 2011. The Lake purchased the Property from Bank Star One on August 31, 2012.

         In its judgment, the trial court ordered the Declaration reformed to include the provisions concerning the boat slip and other condominium amenities. The trial court also awarded the Geiers $8, 554.80 in attorney's fees from the Lake. The Lake timely appeals.

         Discussion Point One-Alleged Variance Between Judgment and Petition Not Preserved for Appellate Review and Waived

The Lake's first point relied on states:
The trial court erred in reforming the Declaration, because under Missouri law, a trial court only has authority to reform a written instrument if fraud or mutual mistake has been pled [sic], in that [the Geiers] did not plead facts to support reformation of the Declaration based on fraud or mutual mistake.[4]

         The Lake raises this issue for the first time on appeal. "Rule 78.09 requires a party, 'at the time the ruling or order of the court is made or sought, [to make] known to the court the action that the party desires the court to take or objections to the action of the court and grounds therefore.' Failure to do so precludes a party from obtaining appellate review of error in the trial court's ruling or order." Brown v. Brown, 423 S.W.3d 784, 787 (Mo. banc 2014). '"An issue that was never presented to or decided by the trial court is not preserved for appellate review.'" Id. at 788 (quoting State ex rel Nixon v. Ant Tobacco Co., Inc., 34 S.W.3d 122, 129 (Mo. banc 2000)). As required by Rule 78.09, the trial court must be given the opportunity to rule on a question. Brown, 423 S.W.3d at 787. Adherence to this rule assists in resolving any alleged error at the earliest possible opportunity by "allowing the trial court to rule intelligently." Id. at 787-88. It is a critical component in the efficient and timely resolution of disputes and the conservation of the parties' and the courts' limited resources. Id. at 788.

         The Lake's failure to make known to the trial court its objection to the judgment because of its alleged variance with the Geiers' first amended petition constitutes a Rule 78.09 waiver of that objection on appeal. Mayes v. St. Luke's Hosp. of Kansas City, 430 S.W.3d 260, 267 (Mo. banc 2014) (citing Pollard v. Whitener, 965 S.W.2d 281, 291 (Mo.App. 1998) and Niederkorn v. Niederkorn, 616 S.W.2d 529, 535 (Mo.App. 1981)). Because the issue raised in the Lake's first point was not preserved for appellate review and was waived, the point is denied.

         Point Two-Substantial Evidence Supports that Development Accidentally Omitted the Contract Terms in the Declaration

The Lake's second point relied on states:
The trial court erred in finding that Declaration should be reformed based on mutual mistake, because in Missouri, in order to reform a Declaration based on mutual mistake, there must be substantial evidence to support a factual finding of mutual mistake, in that no evidence was presented to show that the terms of the Declaration ...

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