Holm v. Wells Fargo Home Mortgage, Inc., 514 S.W.3d 590

David and Crystal Holm owned a home secured by a deed of trust; Freddie Mac owned the note and Wells Fargo serviced it. Storm damage in 2008 produced an insurance check payable to the Holms and Wells Fargo; Wells Fargo withheld endorsement and did not apply funds to the debt.
Wells Fargo/Kozeny sent acceleration/reinstatement communications in 2008; the Holms disputed default, alleged a payment plan and a mistaken belief by Wells Fargo that they abandoned the home.
The night before the scheduled foreclosure sale, Wells Fargo/Kozeny agreed to postpone the sale if the Holms paid a reinstatement amount; the Holms delivered a cashier’s check per instructions but the sale proceeded and Freddie Mac purchased the property.
The Holms sued Wells Fargo for wrongful foreclosure (seeking actual and punitive damages) and sued Freddie Mac to quiet title; extensive discovery disputes followed and the trial court found repeated, deliberate discovery abuses by the mortgage companies.
As sanctions under Rule 61.01 the trial court struck the mortgage companies’ pleadings and barred them from presenting evidence, objecting, or cross-examining witnesses; the Holms then waived a jury, but on trial day the mortgage companies demanded a jury which the court denied.
The court entered judgment for the Holms: liability for wrongful foreclosure, quieted title, and awards of compensatory and large punitive damages. The mortgage companies appealed sanctions, jury-denial, and damages.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether trial court abused discretion imposing discovery sanctions	Mortgage companies’ conduct prejudiced Holms; sanctions appropriate	Sanctions were excessive and defendants did not flagrantly disregard court authority	Affirmed — record shows repeated, intentional discovery abuses warranting striking pleadings and limiting participation
Whether evidence supports wrongful foreclosure liability	Holms: loan was wrongfully accelerated; they had a payment plan and a reinstatement agreement	Mortgage companies: Holms were in default so foreclosure was proper	Affirmed — substantial evidence supported finding Holms not in default and wrongful acceleration
Whether defendants waived right to jury by not requesting one earlier	Holms: their waiver (Holms waived) and sanctions made case uncontested so bench trial appropriate	Mortgage companies: constitutional right to jury preserved absent statutory waiver methods	Reversed (in part) — defendants did not waive jury under §510.190.2; they have right to jury to determine damages
Whether damages award should stand without jury	Holms: sanctions allowed treating defendants as essentially in default so court could award damages	Defendants: constitutional right requires jury to decide actual and punitive damages	Reversed as to damages — jury trial required on actual and punitive damages; liability and sanctions remain in effect

Lewellen v. Franklin, 441 S.W.3d 136 (Mo. banc 2014) (sanctions striking pleadings may establish liability but do not eliminate right to jury determination of damages)
Watts v. Lester E. Cox Med. Ctrs., 376 S.W.3d 633 (Mo. banc 2012) (jury has constitutional role to determine damages; statutes or rules that curtail that role infringe jury right)
Loeb v. Dowling, 162 S.W.2d 875 (Mo. 1942) (foreclosure is not wrongful when there is clear right to foreclose)
Dobson v. Mortg. Elec. Registration Sys., Inc./GMAC Mortg. Corp., 259 S.W.3d 19 (Mo. App. 2008) (plaintiff must plead and prove no default when foreclosure began to recover wrongful foreclosure damages)
Hunter v. Moore, 486 S.W.3d 919 (Mo. banc 2016) (standard of review for court-tried cases: affirm unless no substantial evidence, against weight, or erroneous law)
Advanced Transmissions, L.C. v. Duff, 9 S.W.3d 743 (Mo. App. 2000) (Missouri law does not require affirmative jury demand to preserve constitutional jury right)