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Eckel v. Eckel

Court of Appeals of Missouri, Western District, First Division

February 27, 2018

RICHARD ECKEL, JUDY ECKEL, LIMERICK HEIGHTS, INC., ECKEL ENTERPRISES, INC., and SOARING EAGLES MISSION, Appellants,
v.
E. WAYNE ECKEL and the E. WAYNE ECKEL AND KATHLEEN ECKEL TRUST, Respondents.

         Appeal from the Circuit Court of Boone County, Missouri The Honorable Christine Carpenter, Judge

          Thomas H. Newton, Presiding Judge, and Victor C. Howard and Karen King Mitchell, Judges

          KAREN KING MITCHELL, JUDGE.

         Richard Eckel (Richard), [1] Judy Eckel (Judy), Limerick Heights, Inc. (Limerick), Eckel Enterprises, Inc., and Soaring Eagles Mission (collectively, the Eckel Plaintiffs) appeal from a Boone County Circuit Court judgment dismissing their petition (Petition), which included five counts: Count I (Action to Quiet Title), Count II (Breach of Contract), Count III (Slander of Title), Count IV (Conversion of Real Property), and Count V (Accounting).[2] The Eckel Plaintiffs argue that the motion court erred in dismissing Count I (Quiet Title) because the court applied the wrong statute of limitations, and their claim is not time barred. Also with respect to Count I, Richard and Judy argue that they are the real parties in interest and, therefore, they can assert a quiet title claim. Richard and Judy argue that the motion court erred in dismissing Count III (Slander of Title) because the court applied the wrong statute of limitations, and their claim is not time barred. With respect to Count IV (Conversion of Real Property), the Eckel Plaintiffs concede that they failed to state a claim for conversion because conversion does not apply to real property, but they argue the court erred in denying them leave to amend the Petition to state a claim for conversion of personal property (money). Finally, Richard and Judy assert that the court erred in dismissing Count V (Accounting) because they are the real parties in interest to an enforceable contract between them and E. Wayne Eckel (Wayne) and Kathleen Eckel (Kathleen), and the contract entitles Richard and Judy to an accounting. Finding that dismissal of Counts I (Quiet Title), IV (Conversion of Real Property), and V (Accounting) was appropriate, we affirm the motion court's rulings with respect to those claims. Finding that dismissal of Count III (Slander of Title) was inappropriate, we reverse the motion court's ruling on that claim and remand for further proceedings consistent with this opinion.

         Background[3]

         The Eckel Plaintiffs filed the Petition on April 6, 2016, naming Wayne and the E. Wayne and Kathleen Eckel Trust (the Trust) as respondents.[4] Wayne and Richard are brothers. In 2001, Richard became ill, so he and his wife Judy asked Wayne and his wife Kathleen to take title to, and manage, certain real property, a portion of which is the subject of this lawsuit, and to pay a percentage of the proceeds from the property to Richard, Judy, and Limerick.[5] The real property at issue in this lawsuit (the Property) is identified in the Petition as "Lots One (1) and Six (6) of Forum [C]hapel Plaza as shown on plat of said subdivision recorded in Plat Book 31, page 90, Boone County Missouri Records."

         The Petition describes the following events involving the Property. On July 6, 2001, Wayne and Kathleen, husband and wife, as tenants by the entireties with right of survivorship, acquired fee simple interest to the Property from Soaring Eagles Mission[6] by quitclaim deed.[7]According to the Petition, after the Property was transferred to Wayne and Kathleen, the parties entered into two agreements outlining their respective rights and responsibilities with respect to the Property.[8] Specifically, the Petition alleged that, on July 26, 2001, and again on January 29, 2002, Richard, Judy, Wayne, and Kathleen entered into written agreements whereby the Property would be quitclaimed to Wayne and Kathleen "in return for an agreed amount to be paid on [Wayne and Kathleen's] note plus 22-1/2% of the balance of proceeds after debt toward their stock interest and Rich[ard] and Judy . . . and Limerick . . . are to receive the remaining 77-1/2% of the balance of proceeds after debt toward their stock interest."[9] On July 9, 2002, Wayne and Kathleen, husband and wife, as tenants by the entireties with right of survivorship, transferred fee simple interest in the Property to Limerick by quitclaim deeds.[10] On August 17, 2002, Wayne and Kathleen attempted to acquire fee simple interest in the Property by filing an invalid corporation general warranty deed[11] signed on behalf of Limerick by Wayne, as President, and Kathleen, as Secretary, but neither ever held those positions with Limerick.[12] On February 28, 2003, Wayne and Kathleen transferred the property to Wayne and Kathleen, as Trustees of the Trust, by general warranty deed.[13] Richard and Judy did not become aware of the allegedly fraudulent transfer until August 2015, when they met with counsel.[14]

         Count I of the Petition (Quiet Title) alleged that, because the August 2002 attempt to convey the property to Wayne and Kathleen was ineffective, Limerick still maintained a fee simple interest in the Property pursuant to the July 2002 quitclaim deed, and, therefore, Limerick had authority to convey the Property to Eckel Enterprises, Inc. in 2015. The Eckel Plaintiffs requested that the court quiet title to the Property in their favor and extinguish all purported liens or claims the Trust may have against the Property. Count II of the Petition (Breach of Contract) alleged that Wayne and Kathleen refused to pay the remaining balance of $289, 014.50 due under their agreements with Richard and Judy and had, thereby, breached those agreements. Count III (Slander of Title), brought by Richard and Judy, alleged that Wayne's January 2002 attempt to name himself and Todd as the sole directors of Limerick and the February 2003 deed, which Richard and Judy claimed was filed with malicious intent, caused pecuniary loss or injury to Richard and Judy, including the cost to bring this lawsuit to clear the cloud on their title to the Property and for potential lost income. Count IV (Conversion of Real Property) alleged that the August 2002 attempt to transfer the Property to Wayne and Kathleen was done fraudulently and with the intent to slander the Eckel Plaintiffs' title and deprive them of their right to possess the Property. The Eckel Plaintiffs requested the court to enter orders setting aside the August 2002 general warranty deed and enjoining the Trust from encumbering or disposing of the Property; they also sought punitive damages. Finally, Count V (Accounting) alleged that Richard and Judy were entitled to a full accounting of all money from the Property paid to the Trust.

         On May 13, 2016, the Trust filed a Motion to Dismiss and Suggestions in Support seeking dismissal of all five counts. The Trust moved to dismiss Count I (Quiet Title) and Count III (Slander of Title) as untimely due to expiration of the statutes of limitations.[15] The Trust moved to dismiss Count II (Breach of Contract) for failure to state a claim upon which relief could be granted in that the agreements between Richard and Judy and Wayne and Kathleen did not constitute an enforceable contract. The Trust moved to dismiss Count IV (Conversion of Real Property) on two grounds: (1) the tort of conversion does not apply to real property, and (2) the statute of limitations had expired. Finally, the Trust moved to dismiss Count V (Accounting) on two grounds: (1) failure to name the true party in interest and (2) expiration of the statute of limitations. On June 10, 2016, the Eckel Plaintiffs filed Suggestions in Opposition to the Motion to Dismiss and included in their Suggestions a request for leave to amend Count IV (Conversion of Real Property) to assert a claim for conversion of money. The Trust filed a Reply to the Suggestions in Opposition on June 23, 2016.

         On June 27, 2016, the court heard oral arguments on the Trust's motion, and, on August 25, 2016, the court granted the motion, dismissing all counts of the Petition without stating the grounds for the court's ruling.

         Standard of Review[16]

         "The standard of review for a trial court's grant of a motion to dismiss is de novo." Lynch v. Lynch, 260 S.W.3d 834, 836 (Mo. banc 2008). Where, as here, the court did not state its reasons for dismissal, this court "presumes it was for some reason stated in the dismissal motion and will affirm if dismissal was appropriate on any ground stated therein." Costa v. Allen, 274 S.W.3d 461, 462 (Mo. banc 2008).

         "A motion to dismiss for failure to state a cause of action is solely a test of the adequacy of the plaintiff's petition. It assumes that all of plaintiff's averments are true, and liberally grants to plaintiff all reasonable inferences therefrom." State ex rel. Henley v. Bickel, 285 S.W.3d 327, 329 (Mo. banc 2009) (quoting Bosch v. St. Louis Healthcare Network, 41 S.W.3d 462, 464 (Mo. banc 2001)). "However, the conclusions of the pleader are not admitted." Scher v. Sindel, 837 S.W.2d 350, 351 (Mo. App. E.D. 1992). "No attempt is made to weigh any facts alleged as to whether they are credible or persuasive. Instead, the petition is reviewed in an almost academic manner, to determine if the facts alleged meet the elements of a recognized cause of action, or of a cause that might be adopted in that case." State ex rel. Henley, 285 S.W.3d at 329 (quoting Bosch, 41 S.W.3d at 464). "In order to withstand the motion, the petition must invoke 'substantive principles of law entitling plaintiff to relief and . . . ultimate facts informing the defendant of that which plaintiff will attempt to establish at trial.'" Id. at 329-30 (quoting State ex rel. Union Elec. Co. v. Dolan, 256 S.W.3d 77, 82 (Mo. banc 2008)). "If the petition sets forth any set of facts that, if proven, would entitle the plaintiffs to relief, then the petition states a claim." Lynch, 260 S.W.3d at 836. But, "where the petition fails to allege facts essential to a recovery, " then a motion to dismiss for failure to state a claim may be sustained. Klemme v. Best, 941 S.W.2d 493, 495 (Mo. banc 1997). With respect to the timeliness of claims, "[i]f it clearly appears on the face of the petition that the cause of action is barred by the applicable statute of limitations, the motion to dismiss is properly sustained." Armistead v. A.L.W. Grp., 60 S.W.3d 25, 26 (Mo. App. E.D. 2001).

         Analysis

         The Eckel Plaintiffs argue that the court erred in dismissing Count I (Quiet Title) because the court applied the wrong statute of limitations, and their claim is not time barred. Also with respect to Count I, Richard and Judy argue that they are the real parties in interest and, therefore, they can assert a quiet title claim. Richard and Judy argue that the court erred in dismissing Count III (Slander of Title) because the court applied the wrong statute of limitations, and their claim is not time barred. With respect to Count IV (Conversion of Real Property), the Eckel Plaintiffs concede that they failed to state a claim for conversion because conversion does not apply to real property, but they argue that the court erred in denying them leave to amend the Petition to state a claim for conversion of money. Finally, Richard and Judy assert that the court erred in dismissing Count V (Accounting) because they are the real parties in interest to an enforceable contract that entitles them to an accounting. Finding that dismissal of Counts I, IV, and V was appropriate, we affirm the court's rulings with respect to those counts. Finding that dismissal of Count III was inappropriate, we reverse the court's ruling on that count.

         Before beginning our analysis of these arguments, we address the fact that the points relied on in the Eckel Plaintiffs' brief do not track the counts in the Petition. Specifically, the Eckel Plaintiffs address dismissal of Count I (Quiet Title) in Points I, II, and III of their brief, Count III (Slander of Title) in Point I, Count IV (Conversion of Real Property) in Point IV, and Count V (Accounting) in Points II, III, and V of their brief.[17] For clarity and efficiency, we consider all points appealed regarding Count I together; we do the same with respect to Count V.

         1. Points I, II, and III as to Dismissal of Count I (Quiet Title)

         Count I of the Petition purports to state a cause of action to quiet title. The Petition alleged that Wayne and Kathleen's attempt to convey the Property in 2002 was ineffective, that Limerick maintained its interest in the Property, and that Limerick, through Richard, its president, had the authority to wind up the affairs of the company by transferring the Property to Eckel Enterprises, Inc. in 2015.

         An action to quiet title is a statutory cause of action to adjudicate the interest of several claimants to real property. See Moss v. Moss, 706 S.W.2d 884, 887 (Mo. App. W.D. 1986) (an action to quiet title is "a special statutory action to adjudge the respective estates, titles and interest of several claimants to land"). The statutory cause of action is set out in § 527.150.1, [18] which states,

[a]ny person claiming any title, estate or interest in real property, whether the same be legal or equitable, certain or contingent, present or in reversion, or remainder, whether in possession or not, may institute an action against any person or persons having or claiming to have any title, estate or interest in such property, whether in possession or not, to ascertain and determine the estate, title and interest of said parties, respectively, in such real estate, and to define and adjudge by its judgment or decree the title, estate and interest of the parties severally in and to such real property.

         The Trust moved to dismiss Count I on three grounds: (1) expiration of the statute of limitations; (2) failure to allege the corporate status or good standing of Limerick, the real party in interest; and (3) unclean hands on the part of Richard and Judy. The Eckel Plaintiffs argue that the court erred in dismissing Count I because (1) the court applied the wrong limitations period, and their claim for quiet title is not time barred (Point I); (2) Richard and Judy are the real parties in interest, and, therefore, can assert a quiet title claim (Point II); and (3) the agreements between Richard and Judy and Wayne and Kathleen meet all the elements of an enforceable contract, and, therefore, Richard and Judy can assert a quiet title claim under the contract (Point III). The dismissal of Count I was appropriate because the quiet title claim was time barred.

         "An action to quiet title is governed by the ten[-]year statute of limitation[s] contained in section 516.010." Basye v. Fayette R-III Sch. Dist. Bd. of Educ., 150 S.W.3d 111, 115 (Mo. App. W.D. 2004). Section 516.010 states, in pertinent part, "[n]o action for recovery of any lands, . . . or for the recovery of the possession thereof, shall be commenced . . . by any person . . ., unless it appears that the plaintiff . . . or other person under whom he claims was seized or possessed of the premises in question, within ten years before the commencement of such action." Based on this language, the Eastern District of this court held that no action to quiet title may be maintained unless the plaintiff, or someone under whom he claims, has been seized or possessed of the property within ten years before the action is filed. Hooks v. Spies, 583 S.W.2d 569, 572-73 (Mo. App. E.D. 1979) (allowing party with record title to bring quiet title action where evidence did not show possession in another title within ten years prior to commencement of action). There, the court said, "'[s]eisin' embraces both possession and title and 'he who does not have both of these is not seised of the land.'" I ...


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