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Aguilar v. Geico Casualty Co.

Court of Appeals of Missouri, Western District, Second Division

September 3, 2019


          Appeal from the Circuit Court of Jackson County, Missouri Honorable James F. Kanatzar, Judge

          Before Lisa White Hardwick, P.J., Thomas H. Newton, and Mark D. Pfeiffer, JJ.

          Thomas H. Newton, Judge

         GEICO Casualty Co. appeals from a Jackson County Circuit Court judgment confirming a $35-million arbitration award arising from a catastrophic motorcycle accident and applying the statutory rate of interest from the date of judgment. GEICO challenges the court's orders overruling its motion and amended motion to intervene. We affirm.

         Mr. Richard A. Aguilar sustained serious and permanent injuries in 2013 after the U-Haul truck Ms. Patricia Hollandsworth was driving while intoxicated ran into the motorcycle he was riding on Chouteau Trafficway in Jackson County, Missouri. The claim was reported to GEICO in November 2013, and the company disclaimed any and all liability in March and April 2014. GEICO had issued an automobile liability insurance policy to Mr. Daniel and Ms. Deborah Clymens for their 2005 Toyota, and, during the coverage period, Mr. Clymens signed the paperwork to rent the 2006 Ford U-Haul truck involved in the accident so Ms. Hollandsworth could move her belongings from the Clymenses' residence to a new home.

         Mr. Aguilar brought a personal-injury action against Ms. Hollandsworth in August 2017. Mr. Aguilar filed a motion for default judgment in February 2018, and GEICO's counsel entered an appearance on Ms. Hollandsworth's behalf at about the time the company offered to defend her subject to a reservation of rights. Ms. Hollandsworth rejected that defense, and she informed GEICO on March 2, 2018, that she and Mr. Aguilar had entered a section 537.065 agreement under which she had assigned him all of her rights under the Clymenses' GEICO insurance policy.[1] GEICO filed a motion to intervene in the personal-injury action as of right five days later under Rule 52.12(a) and section 537.065.2.[2] Mr. Aguilar voluntarily dismissed the personal-injury petition eight days later on March 15, 2018. The same day, GEICO filed for declaratory judgment in federal court, which dismissed the action without prejudice about a year later for abstention reasons in light of a state-court garnishment action, filed by Mr. Aguilar against Ms. Hollandsworth and GEICO in November 2018, that remains pending.[3]

         Mr. Aguilar and Ms. Hollandsworth entered an agreement in May 2018 to submit the dispute to binding arbitration. The arbitrator conducted a hearing in June 2018 and awarded Mr. Aguilar $35 million in compensatory and punitive damages in July 2018. After Mr. Aguilar filed a motion in circuit court to confirm the arbitration award, GEICO filed a motion and an amended motion to intervene, citing Rules 52.12(a) and (b), as well as section 537.065. On October 24, 2018, the circuit court denied the motion to intervene without comment other than a reference to Mr. Aguilar's pleadings and issued a judgment confirming the arbitration award with 7.5% statutory interest. GEICO timely filed an appeal from the judgment.[4] The circuit court subsequently amended the order addressing the motion to intervene in November 2018 to add to the first order denying GEICO's motion to intervene a denial of GEICO's amended motion to intervene, and GEICO filed a second appeal to include this amended order. We consolidated the appeals.[5]

         Legal Analysis

         In the first point, GEICO argues that the trial court erred in denying its motions to intervene because substantial evidence does not support the ruling and the court misapplied the law-section 537.065-in that it confers an unconditional right on GEICO to intervene in a lawsuit before the entry of judgment where the parties have entered a section 537.065 agreement, and the court's denial of intervention deprived GEICO of due process and access to the courts. We agree with Mr. Aguilar that this is a multifarious point that preserves nothing for review under Rule 84.04 by making separate and distinct claims in a single point.[6] Still, we may, in the exercise of our discretion, "attempt to resolve the issue on the merits." LaBarca v. LaBarca, 534 S.W.3d 329, 335 n.4 (Mo. App. W.D. 2017) (citation omitted).

         When a trial court denies a motion to intervene as of right under Rule 52.12, we affirm "unless there is no substantial evidence to support [the ruling], it is against the weight of the evidence, or it erroneously declares or applies the law." Prentzler v. Carnahan, 366 S.W.3d 557, 560 (Mo. App. W.D. 2012) (quoting State ex rel. Nixon v. Am. Tobacco Co., Inc., 34 S.W.3d 122, 126 (Mo. banc 2000)). Rule 52.12(a) gives anyone "[u]pon timely application" the right to intervene in an action "(1) when a statute of this state confers an unconditional right to intervene." Section 537.065.2 gives insurers the right to written notice "[b]efore a judgment may be entered against any tort-feasor after such tort-feasor has entered into a contract under this section." Subsection 2 also confers on insurers the right to intervene by stating that they "shall have thirty days after receipt of such notice to intervene as a matter of right in any pending lawsuit involving the claim for damages."

         GEICO focuses on the first part of section 537.065.2 that it claims gives it the right to intervene "[b]efore a judgment may be entered." According to GEICO, its "statutory right to intervene was a mandatory precondition on the entry of judgment against [Ms.] Hollandsworth" and it had thirty days after the petition to confirm the arbitration award was filed to attempt to intervene. We disagree. The plain and unambiguous meaning of the statute requires that a tortfeasor and injured party give notice to the insurer of a section 537.065 contract before a judgment may be entered, not that the insurer must be allowed to intervene before judgment may be entered. Any other interpretation ignores and renders superfluous the latter part of subsection two which requires that the insurer file its motion to intervene in a pending lawsuit thirty days after receipt of such notice.[7]

         While GEICO observes that Mr. Aguilar's argument as to intervention concerned primarily whether an arbitration proceeding constituted a "lawsuit" as that word is used in section 537.065.2, we are constrained to address and decide this point on the timeliness of the company's motion to intervene in light of our decision in Britt v. Otto, 577 S.W.3d 133 (Mo. App. W.D. 2019). There, we declined to rule whether an arbitration proceeding fit within the term "pending lawsuit" under the statute, but affirmed the trial court's denial of intervention, finding that the insurer's motion was not filed within thirty days from its receipt of written notice of the section 537.065.1 contract. Id. at 140. In this regard, we held that the "plain and unambiguous language of section 537.065.2 did not afford American Family the right to intervene as a matter of right in the action to confirm the arbitration award," because the action to confirm the arbitration award was filed more than thirty days after the insurer received written notice of the section 537.065.1 contract. Id. Similarly, here, written notice of the contract was provided to GEICO on March 2, 2018. While GEICO timely filed a motion to intervene in the personal-injury action, that action was voluntarily dismissed, and the parties proceeded to arbitration. The action to confirm the arbitration award was filed August 9, 2018, far outside the statute's thirty-day limit, so the motion and amended motion to intervene as of right in that action were untimely.[8]

         GEICO further argues that it has standing to intervene for the purpose of challenging an arbitration award. Because the point relied on does not raise this issue, we do not consider it further. Rule 84.04. See Spencer v. Lombardi, 500 S.W.3d 885, 889 (Mo. App. W.D. 2016) ("an appellant's argument is limited to only those errors asserted in the points relied on." (citation omitted)).

         Finally, GEICO argues as to the first point that its interest in the subject matter of the dispute between Mr. Aguilar and Ms. Hollandsworth makes the denial of the motion to intervene a violation of due-process rights under the U.S. and Missouri constitutions and "an unreasonable impediment to its constitutional right of access to the courts" under the Missouri Constitution. GEICO has not stated the facts showing the purported constitutional violation and simply makes the same conclusory statements here that it made to the trial court, i.e., that it has an interest in the subject matter of the litigation and that the denial of its motions will leave in place a final judgment against Ms. Hollandsworth, "based upon an invalid Arbitration Agreement procured by undue means." GEICO has neither preserved nor presented this constitutional challenge properly. See Mayes v. St. Luke's Hosp. of Kansas City, 430 S.W.3d 260, 266 (Mo. banc 2014) (setting forth requirements for preservation of a constitutional challenge, court observes that the purpose of ...

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