Court of Appeals of Missouri, Western District, Second Division
from the Circuit Court of Jackson County, Missouri The
Honorable David Michael Byrn, Judge
Before: Thomas N. Chapman, P.J., Mark D. Pfeiffer, and
Cynthia L. Martin, JJ.
N. Chapman, Presiding Judge
Bengtson (Bengtson), W. Gordon Snyder (Snyder), Heartland
Financial Services, LLC (Heartland) and Navigator Investment
Services, LLC (Navigator) (collectively "B.S.H.N.
Defendants") appeal the order of the Circuit Court of
Jackson County denying their motion to compel arbitration of
a cause of action brought by Abdiana Properties, Inc. and
Abdiana Ice House, Inc. (together "Abdiana"). In
Points 1, 3, and 4 of their appeal, the B.S.H.N. Defendants
assert that Abdiana entered into a Private Debt Financing
Agreement with Stone Development Inc. ("Stone," a
separate defendant that is not one of the appellants) and
that because Abdiana's claims against the B.S.H.N.
Defendants are related to, rely upon, and are intertwined
with the Private Debt Financing Agreement, the B.S.H.N.
Defendants are entitled, though non-signatories, to enforce
the arbitration clause in said agreement. In Point 2 of their
appeal, B.S.H.N. Defendants contend that Abdiana and
Defendant Navigator executed a written Consulting Fee
Agreement that included an arbitration clause, and that this
was enforceable not only by Navigator, but also by the
remaining non-signatory B.S.H.N. Defendants (Bengtson,
Snyder, and Heartland). We affirm.
and Procedural Background
April of 2014, Christina and Nicholas Abnos, the owners of
Abdiana, reached out to Bengtson, the principal of Heartland,
with whom they had worked in the past, to discuss obtaining a
line of credit to use in property development. Bengtson
undertook assisting the Abnoses in obtaining a source of
private funding in the amount of $3, 500, 000. With the
Abnoses' approval, Bengtson had Snyder assist him in this
task. Through the B.S.H.N. Defendants, Abdiana
began communicating with Stone, a secondary market lender
based in California. The B.S.H.N. Defendants maintained that
they had successfully closed loans with Stone in the past.
Defendants then provided Abdiana a "Letter of
Commitment" from Stone, which included the terms of the
proposed loan, which required that Abdiana pay a $52, 500
loan commitment fee, and which provided that Stone would
refund the loan commitment fee if it did not fully fund the
$3, 500, 000 credit facility within sixty days.
27, 2014, prior to making any payments to Stone, Christina
received an email from Bengtson which included a proposed
(but unsigned) Consulting Fee Agreement to be executed by
Abdiana (by Managing Member Nicholas Abnos) and Defendant
Navigator (by Bengtson, as "Manager Consultant").
Bengtson also provided documentation purporting to show that
Stone possessed enough funds to fulfill its role. After
receiving this supporting information, Abdiana sent three
wire transfers totaling the entire $52, 500 loan commitment
fee to Verlin Gradney (a separate defendant alleged to be a
principal and trustee of Stone). These separate transfers
began on May 30, 2014, with a transfer of $31, 500; and were
completed on June 4, 2014. The proposed Consulting Fee
Agreement provided that Navigator would receive a 3%
commission on any amounts loaned to Abdiana by any money
lending sources introduced by Navigator; and also contained
an arbitration provision governing any disputes.
2, 2014, after sending the first wire transfer partly paying
the loan commitment fee, Christina replied to Bengtson's
email with a proposed Consulting Fee Agreement attached,
which had been revised and signed by Christina as Managing
Member of Abdiana. Christina had crossed out an
indemnification provision in the proposed Consulting Fee
Agreement, and noted that this provision was intentionally
deleted. Neither Bengtson, nor anyone else, signed the
revised Consulting Fee Agreement on behalf of Navigator or
the other B.S.H.N. Defendants.
and Stone later executed a Private Debt Financing Agreement,
which purportedly included an arbitration provision. The
Private Debt Financing Agreement was not included with the
motion to compel arbitration and does not appear to have been
provided to the circuit court, and is not included in our
September of 2015, after repeated requests to be provided the
loan funding or have their loan commitment fee reimbursed,
Abdiana was informed, during a conference call with Bengtson
and representatives of Stone, that Stone was unable to fund
the credit facility and was unable to refund the $52, 500.
filed the underlying action on May 6, 2016, and their First
Amended Verified Petition for Damages on June 2, 2017.
Abdiana brought claims for fraudulent misrepresentation,
negligent misrepresentation, and civil conspiracy against the
B.S.H.N. Defendants (the Appellants), and also against Stone,
Gradney, and others. Abdiana also brought a count of
professional negligence against Bengtson, Snyder, and
Heartland; a breach of contract claim against Stone; and a
claim for conversion against Gradney. The B.S.H.N. Defendants
filed a motion to compel arbitration on January 22, 2018,
which was denied by the trial court in its written order
filed on May 29, 2018. This appeal followed.
issue of whether arbitration should be compelled is a
question of law subject to de novo review."
State ex rel. Alst v. Harrell, 528 S.W.3d 442, 445
(Mo. App. W.D. 2017) (quoting Baker v. Bristol Care,
Inc., 450 S.W.3d 770, 774 (Mo. banc 2014)). The parties
do not dispute that the underlying case involves parties from
separate states and that "[t]he Federal Arbitration Act
('FAA'), 9 U.S.C. § 1 et seq. (2006),
governs the applicability and enforceability of arbitration
agreements in all contracts involving interstate
commerce." Id. at 446 (quoting Eaton v. CMH
Homes, Inc., 461 S.W.3d 426, 431 (Mo. banc 2015)).
Although we defer to the FAA where it is in tension with
Missouri law, "Missouri contract law applies to
determine whether the parties have entered a valid agreement
to arbitrate." State ex rel. Vincent v.
Schneider, 194 S.W.3d 853, 856 (Mo. banc 2006). Our
review of a court's interpretation of an arbitration
provision is a matter of law that we review de novo.
Id. "The party asserting the existence of a
valid and enforceable contract to arbitrate bears the burden
of proving that proposition." Kohner Properties,
Inc. v. SPCP Group VI, LLC, 408 S.W.3d 336, 342 (Mo.
App. E.D. 2013).
addressing the question of whether a valid agreement to
arbitrate exists, we first examine whether the agreements at
issue are properly before this Court. We note that
"[e]xhibits attached to motions filed with the trial
court are not evidence and are not self-proving."
Bertocciv. Thoroughbred Ford, Inc., 530
S.W.3d 543, 551 (Mo. App. W.D. 2017) (quoting Ryan
v.Raytown Dodge Co., 296 S.W.3d 471, 473 (Mo.
App. W.D. 2009)). Here the B.S.H.N. Defendants did not
request oral argument or a hearing on their Motion to Compel
Arbitration; and their Motion was not supported by
affidavits. The circuit court did not hold a hearing
on the Motion and thus neither of ...