Brittany Hunter v. Charles Moore, Sr.
2016 Mo. LEXIS 113
Mo.2016Background
- Plaintiff (Brittany Hunter) sued for negligence after injuries at a motel; defendant Charles Moore Sr. and motel-employer insured by American Family (Insurer).
- Defendant rejected Insurer’s reservation-of-rights defense and, after Insurer sought declaratory relief, Defendant and Plaintiff negotiated a section 537.065 settlement limiting execution to specified assets/insurance proceeds.
- The signed written settlement assigned certain insurance-proceeds rights to Plaintiff and required Defendant’s cooperation to pursue insurer recovery, but it did not explicitly state how Defendant would cooperate in the underlying negligence action nor whether Insurer could control the defense.
- Contemporaneous communications: Defendant’s counsel sent Insurer a letter demanding withdrawal and stating Defendant did not trust Insurer’s counsel; Insurer later dismissed Defendant from the declaratory action but its attorney continued to represent Defendant in the negligence suit.
- Plaintiff sought reformation and specific performance to add two terms she says were agreed-upon but omitted by mutual mistake: (1) Insurer barred from controlling the underlying defense; and (2) Defendant must cooperate by agreeing to an uncontested hearing on liability and damages (or consent judgment).
- Trial court reformed the written agreement to include both disputed terms; this appeal challenges whether substantial evidence supported reformation. The Supreme Court of Missouri affirmed but removed the consent-judgment alternative (parties never intended consent judgment).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether reformation is warranted for mutual mistake to add term barring Insurer from controlling the defense | Parties mutually agreed defendant/Insurer would not control defense; omission was mutual mistake and reformation needed | No substantial evidence of mutual mistake; trial court erred in crediting Plaintiff’s attorney over Defendant’s counsel | Reformation to include a clause precluding Insurer from controlling the defense is supported by clear, cogent, convincing evidence and affirmed |
| Whether reformation should require Defendant to cooperate by consent judgment or uncontested hearing on liability/damages | Parties agreed Defendant would cooperate in underlying suit by either consenting to judgment or submitting to an uncontested liability/damages hearing | Defendant argues no intent to consent to judgment and no basis to add such terms | Reformation to require cooperation was proper, but consent-judgment option modified away because parties never intended consent judgment; obligation limited to an uncontested hearing on liability and damages |
Key Cases Cited
- Butters v. City of Independence, 513 S.W.2d 418 (Mo. 1974) (insurer who refuses to defend without reservation may not control defense of insured)
- State ex rel. Rimco, Inc. v. Dowd, 858 S.W.2d 307 (Mo. Ct. App. 1993) (insurer denying unqualified defense forfeits right to control litigation)
- King v. Riley, 498 S.W.2d 564 (Mo. 1973) (equity will reform instruments that, through mutual mistake, do not reflect parties’ true agreement)