J.B. Allеn, Inc. (hereinafter, “J.B.Allen”) appeals the trial court’s judgment dismissing its petition to enforce the terms of a promissory note claiming: (1) it was improper to raise and determine a suretyship defense by a motion to dismiss and to consider matters оutside of the pleadings when ruling on the motion to dismiss; (2) the trial court erred in treating Trisha Pearson’s motion to dismiss as a motion for summary judgment in that the trial court failed to give J.B. Allen the requisite notice of its treatment as such and did not allow time to present additional evidence to respond to Trisha Pearson’s motion; and (3) there are genuine issues of material fact precluding judgment as a matter of law. We reverse and remand.
J.B. Allen sold a Mailboxes, Etc. franchise, including equipment, inventоry, and receivables to Pearson, Inc. On November 27,1995, the parties executed a promissory note for $47,500 in connection with the sale. Four people signed the promissory note: Herby Pearson, in his capacity as President of Pearson, Inc. and as “Guarantor”; Trisha Pearson, in her capacity as Secretary of Pearson, Inc. and as “Guarantor”; Herby Pearson, Sr., as “Guarantor”; and Barbara Pearson as “Guarantor.”
On or about September 1,1998, Pearson, Inc. became delinquent on the promissory note, and when it failed to make the principal and interest payments when due in September and October, ultimately defaulted. J.B. Allen made demand upon Pearson, Inc. to pay the amounts due, but Pearson, Inс. failed to tender the amounts owing. On October 28, 1998, J.B. Allen gave notice of his intention to accelerate the amount due under the promissory note and sued Pearson, Inc. to collect on the note.
On November 8, 1999, the parties entered into a stipulation for settlement. The settlement determined, inter alia, the defendants, Herby Pearson, Sr., Herby Pearson, Jr., and Barbara Pearson, would pay as a group to J.B. Allen $23,000, in three installments of $7,666.67, payable on November 23, 1999, January 8, 2000, and March 8, 2000. The settlеment also stated the claim was to be dismissed as to the
On November 10, 1999, J.B. Allen brought an action against Trisha Pearson to collect on the same promissory notе defaulted on by Pearson, Inc. J.B. Allen sought approximately $22,000 in damages, which included principal and interest under the note, attorney fees, and costs of collection. An answer was not filed. J.B. Allen filed a motion for summary judgment on December 1, 1999. Trisha Pearson responded to the motion for summary judgment and also filed a motion to dismiss. The motion to dismiss alleged that the promissory note had been satisfied in full by the payments agreed to under the stipulation for settlement, that she had no knowlеdge and did not consent to the settlement, and that the settlement was a material alteration of the promissory note resulting in discharge of liability as an alleged guarantor.
On March 13, 2000, the trial court entered an order denying J.B. Allen’s motion for summary judgment and granting Trisha Pearson’s motion to dismiss. A notice of appeal was promptly filed, but the order was not denominated a final judgment until the court filed its order nunc pro tunc on April 18, 2000. J.B. Allen submitted his brief on July 14, 2000, with a copy of the final judgment filed on August 14, 2000, and submitted аs a supplement to the legal file. This appeal follows.
To ascertain the proper standard of review, we must determine whether the trial court treated Trisha Pearson’s motion to dismiss as a motion for summary judgment. Therefore, we will аddress J.B. Allen’s second point on appeal first. J.B. Allen asserts the trial court erred in treating Trisha Pearson’s motion to dismiss as a motion for summary judgment in that the trial court did not provide timely notice of its intention to treat her motion as such, and did not provide it an opportunity to present additional evidence to respond to her motion. J.B. Allen alleges that at the hearing for the motion to dismiss, the trial court informed counsel for the first time it intended to treat the motion to dismiss as a motiоn for summary judgment. Trisha Pearson argues the trial court was correct in treating the motion to dismiss as a motion for summary judgment, and J.B. Allen waived any objection to the notice and response requirement after the trial court offered to prоvide it with additional time to respond to the pending motion.
Before a trial court may treat a motion to dismiss as one for summary judgment, when matters outside the pleadings are presented and not excluded, it must first notify the parties that it is going to do so and give the parties an opportunity to present all materials pertinent to the motion for summary judgment. Rule 55.27(a); Manzer v. Sanchez,
In this case, there is ample evidence that the motion to dismiss was treated as a motion for summary judgment. The trial court relied on thе stipulation of settlement entered against Pearson, Inc. in the previous case in ruling on the motion to dismiss. This stipulation of settlement was clearly outside the pleadings and not excluded. The final judgment also indicates that the motion to dismiss was treated as a motion for summary judgment stating J.B. Allen waived the thirty day
Since the motion to dismiss was treated as a motion for summаry judgment, even when the trial court fails to provide notice of its doing so, the court is not precluded from ruling on the motion where the nonmoving party acquiesces in the trial court’s action and, thereby, waives the notice requirement. Keim v. Big Bass, Inc.,
J.B. Allen’s third point on appeal claims the trial court erred in granting summary judgment in favor of Trisha Pearson and dismissing its petition because the trial court erroneously declared the law in not requiring proof of the loss or impairment of the right of recourse against Pearson, Inc.. Further, it alleges the trial court erred because it did not require Trisha Pearson to offer any evidenсe of how her right of recourse against Pearson, Inc. was impaired by the stipulation of settlement entered into between J.B. Allen and Pearson, Inc.. J.B. Allen argues that in the absence of this evidence, Trisha Pearson was not entitled to judgment аs a matter of law. J.B. Allen’s fourth point on appeal argues that the absence of this evidence presents a genuine issue of material fact regarding the extent of Trisha Pearson’s impairment precluding summary judgment in her favor.0 We agree.
In addressing J.B. Allen’s allegation that the trial court erred in granting summary judgment in favor of Trisha Pearson, it is well settled that when considering an appeal from summary judgment, we review the record in the light most favorable to the nonmovant. ITT Commercial Fin. v. Mid-America Marine,
The nonmovant must show by affidavits, depositions, answers to interrogatories, or admissions on file, that one or more of the material facts shown by the movant to be without any genuine disputе is, in fact, genuinely disputed. Id. A “genuine issue” exists where the record contains competent materials that establish a plausible, but contradictory, version of the movant’s essential facts. Id. at 382.
However, the legislаture enacted Section 400.3-605 RSMo (1994)
Trisha Pearson’s status as an accommodation party alone does not answer the question of whethеr she has been discharged under the promissory note. Section 400.3-605(c) states when an extension of time is granted by the creditor to the principal debtor, this extension discharges the accommodation party having a right of recourse against the principal debtor to the extent the accommodation party proves the extension caused a loss to the accommodation party with respect to her right of recourse. Moreover, under Section 400.3-605(d), when there is a material modification of the obligation, the accommodation party is discharged to the extent the modification causes loss to the accommodation party with respect to the right of recourse.
In this case, it is clear these statutory provisions apply. An accommodation party is required to show the extent of loss, which results in the impairment of the right of recourse, when arguing that a material modification or extension of time discharges its obligation under a promissory note. Here, there is nothing in the record to support a finding that Trisha Pearson presented any evidence as to her loss and impairment of her right of recourse against Pearson, Inc., which is required under the statute. We find the absence of this evidence presents a genuine issue of material fact as to the extent of her loss or impairment of her right of recourse, thus precluding summary judgment in her favor.
We reverse and remand.
Notes
. The final judgment had a handwritten sentence, initialеd by both parties’ attorneys which stated: “Plaintiff [J.B. Allen] consents to hearing of Motion and waives 30 day response time without waiving objections to issues raised in Reply to Response to Motion for Summary Judgment."
. All further statutory references are to RSMo (1994) unless otherwise indicated.