417 S.W.3d 348
Mo. Ct. App.2013Background
- Homeowner owned a lot in Jamestowne Subdivision subject to an Indenture that required 30 days’ written notice of annual assessments signed or bearing the trustees’ names and authorized recovery of unpaid assessments with interest, costs, and attorneys’ fees.
- Association sued (Chapter 517) for unpaid assessments from 2003–2012, interest, collection costs, and attorneys’ fees; a default judgment was set aside and the case proceeded to a bench trial.
- Association’s proof relied primarily on testimony from Karen Kelly of City & Village Tax Office, LLC (the company contracted to bill/collect for Association), a 2012 invoice (Ex. 3), an accounts report (Ex. 4), and an affidavit of attorneys’ fees (Ex. 5).
- Trial court admitted Exhibits 3 and 4 over objections and entered judgment for Association for unpaid assessments (2003–2012), interest, collection costs, and attorneys’ fees; Homeowner appealed.
- The appellate court found the record supported liability only for the 2012 assessment notice (not 2003–2011), affirmed admission of business records, treated the objection to the fee affidavit as waived (so Exhibit 5 was in the record), reversed recovery for 2003–2011, and remanded to recalculate fees and costs for 2012 and for appellate fees.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Admissibility of records (Exs. 3 & 4) under business-records hearsay exception | Association: Kelly had personal knowledge and managed City & Village’s recordkeeping for Association; records made in ordinary course | Homeowner: Kelly not custodian, lacked sufficient knowledge of creation/accuracy | Court: Admission proper — Kelly qualified; foundation sufficient under §490.680 and precedent |
| Compliance with Indenture notice requirement (2003–2012) | Association: Substantial performance/spirit of Indenture satisfied; 2012 invoice showed notice on Association’s behalf | Homeowner: Indenture required particularized signed/name-bearing notices for each year; only 2012 notice proved | Court: Reversed recovery for 2003–2011 (no proof of required notices); affirmed liability for 2012 (Ex. 3 sufficient in spirit) |
| Attorneys’ fees proof (Ex. 5) | Association: Exhibit 5 affidavit shows $5,856.50 in fees; court can award fees under Indenture | Homeowner: Affidavit hearsay, never seen, no cross-examination; insufficient evidence | Court: Objection not ruled on at trial and deemed waived; Exhibit 5 treated as admitted — fees supported in record; remand to adjust fees to reflect reversal for 2003–2011 |
| Leave to file affirmative defenses late | Homeowner: Good cause — inadvertent procedural error and late filing was unintentional | Association: Motion untimely; prejudice/waiver | Court: No good cause shown for missing the court-ordered deadline; denial of leave not an abuse of discretion |
Key Cases Cited
- Murphy v. Carron, 536 S.W.2d 30 (Mo. banc 1976) (standard of review for court-tried cases)
- CACH, LLC v. Askew, 358 S.W.3d 58 (Mo. banc 2012) (witness must show when/how record was created to qualify under business-record exception)
- Asset Acceptance v. Lodge, 325 S.W.3d 525 (Mo. App. E.D. 2010) (witness must have sufficient knowledge of business recordkeeping to provide probative foundation)
- Phillips v. Authorized Investors Group, 625 S.W.2d 917 (Mo. App. E.D. 1981) (party must follow indenture’s prescribed procedure before suing to collect assessments)
- Braeshire Condominium Bd. of Mgrs. v. Brinkmeyer, 841 S.W.2d 217 (Mo. App. E.D. 1992) (substantial compliance with bylaws may suffice when procedure comports with bylaws’ spirit)
- Engel v. Carver, 675 S.W.2d 434 (Mo. App. E.D. 1984) (contractual procedural requirements must be followed to recover)
- The Manors at Village Green Condominium, Inc. v. Webb, 341 S.W.3d 162 (Mo. App. E.D. 2011) (evidence must support judgment for assessments)
- Ziegler v. Dir. of Revenue, 150 S.W.3d 145 (Mo. App. E.D. 2004) (objecting party must insist on a ruling to preserve objection; failure deems objection overruled)
- Rosehill Gardens, Inc. v. Luttrell, 67 S.W.3d 641 (Mo. App. W.D. 2002) (appellate courts may award fees but typically remand for trial court determination)
- SE Co-Op Service Co. v. Hampton, 263 S.W.3d 689 (Mo. App. S.D. 2008) (appellate fee awards authorized when based on written agreement at issue)