The Flag, July-Aug. 2020
Vol. 76, No. 4 / July - Aug. 2020
W. Dudley McCarter
W. Dudley McCarter, a former president of The Missouri Bar, is a partner in the St. Louis law firm of Behr, McCarter & Potter, P.C.
EVEN THOUGH ACCIDENT OCCURRED IN MISSOURI, KANSAS LAW APPLIED BECAUSE PLAINTIFF RECEIVED WORKERS’ COMPENSATION BENEFITS IN KANSAS
“Tonda Hill appeals from the judgment dismissing, with prejudice, her claim of negligence arising from a car accident involving her former supervisor, Steven Freedman.”2 “She argues that the motion court erred in dismissing her negligence claim….”3
In January 2014, when the alleged negligent act occurred, Hill and Freedman were citizens and residents of Kansas and were employed by the University of Kansas School of Law, where Freedman was Hill’s supervisor. Hill alleges that, while Freedman was driving her to a work-related event at a law firm in Kansas City, Missouri, he began yelling at her about an upcoming speaker panel. After the vehicle entered the law firm’s parking garage, Freedman allegedly revved the engine while continuing to yell at Hill, put the vehicle in reverse, and slammed the vehicle into a concrete barricade. The collision injured Hill, who was unable to work for a period of time as a result. Hill reported her injuries to the University and “exercised her rights to report, and receive treatment and pay for, a workplace injury.” In August 2017, Hill filed a single-count suit against Freedman, alleging discrimination based on her exercise of her workers’ compensation rights.4
“In September 2018, Hill filed her second amended petition, the operative petition here, asserting four causes of action – assault, battery, negligence, and discrimination based on her exercise of her workers’ compensation rights.”5
Freedman moved to dismiss all four counts, focusing his arguments in response to Hill’s negligence claim on failure to state a claim and statutory immunity under the [Kansas Tort Claims Act (KTCA)].
On February 8, 2019, the motion court issued an order dismissing Hill’s second amended petition with prejudice. The motion court concluded that Hill applied for and received workers’ compensation under Kansas law, Kansas law governs issues related to her injury, and Hill failed to state a claim for negligence or discrimination based on her exercise of her workers’ compensation rights under Kansas law. As to Hill’s negligence claim specifically, the court found that Hill is statutorily barred from asserting a negligence claim against Freedman under Kansas law, and he is immune from Hill’s negligence claim under the KTCA.6
The judgment was affirmed in Hill v. Freedman.
According to Hill’s second amended petition, Freedman’s allegedly negligent act and Hill’s resulting injury occurred in Missouri. Hill argues that the general choice-of-law rule is to apply the law of state where the conduct and injury occurred (here, Missouri), citing Livingston v. Baxter Health Care Corp., 313 S.W.3d 717, 722 (Mo. App. 2010). But the general rule is subject to exceptions. And Hill’s second amended petition indicates that one such exception applies here. Hill acknowledges that, following her injury, she applied for and received compensation under Kansas’s Workers Compensation Act. Hill’s decision to pursue that remedy means that Kansas law governs issues related to her injury. See McLendon v. Kissick, 250 S.W.2d 489, 493 (Mo. 1952) (“[T]he fact remains that plaintiffs chose to collect compensation under the Kansas law. They are bound by their choice.”); see also Farham v. Daar, Inc., 184 F. Supp. 809, 811 (W.D. Mo. 1960) (“Missouri will follow the law of the state where the employee accepted compensation, even though the employee is injured in Missouri.”).7
Having concluded that Hill’s negligence claim against Freedman is governed by Kansas law, we turn to the law of that state to determine whether Hill states a cause of action against Freedman for negligence.
In her second amended petition, Hill alleges that both she and Freedman were employees of the University of Kansas, and thus, the State of Kansas. Hill further alleges that Freedman was “performing work” where her injury occurred.8
“[B]ecause Hill and Freedman were both employed by the State of Kansas during the relevant time, Hill may not assert a claim against her fellow employee Freedman because Hill’s injury is compensable under the Kansas Workers Compensation Act.”9
Hill’s negligence claim fails to state a cause of action because the KTCA provides immunity for Freedman from exactly the type of claim.
Thus, the assumption underlying each of Hill’s points on appeal – that Missouri law applies – is incorrect, and under the Kansas Workers Compensation Act and the KTCA, Hill is precluded from suing Freedman for negligence under the circumstances of this case.10
DEFENDANT LACKED SUFFICIENT MINIMUM CONTACTS TO SUPPORT PERSONAL JURISDICTION
“LG Chem, Ltd., seeks a writ of prohibition to prohibit the circuit court of St. Louis County from enforcing its order overruling LG Chem’s motion to dismiss for lack of personal jurisdiction. Because LG Chem lacks sufficient minimum contacts with the state of Missouri, due process prohibits Missouri courts from asserting personal jurisdiction over LG Chem in this matter. The preliminary writ is made permanent” … in State ex rel. LG Chem LTD. v. McLaughlin.11
LG Chem is a Korean company with its headquarters in Seoul, South Korea. LG Chem manufactures electronic equipment, including model 18650 lithium-ion batteries. One of LG Chem’s model 18650 batteries is the subject of the action underlying this writ proceeding.
In the underlying action, Peter Bishop sued LG Chem in the St. Louis County circuit court under a products liability theory, asserting counts in negligence and strict tort liability. Bishop alleged he purchased one of LG Chem’s model 18650 batteries from Smoke Smart, LLC, a retailer of electronic cigarettes and accessories located in St. Peters, Missouri, for use in his e-cigarette. Bishop alleged the battery spontaneously exploded in his pocket one day, and, as a result, he suffered burn injuries.12
“Bishop also alleged LG Chem manufactured a very large number of model 18650 batteries that were sold and distributed into the United States through a third-party distributor.”13 “Bishop alleged LG Chem knew or should have known third parties were distributing its model 18650 batteries to consumers throughout the United States, including consumers in Missouri.
LG Chem filed a motion to dismiss for lack of personal jurisdiction, arguing due process does not permit Missouri courts to exercise personal jurisdiction over LG Chem in this matter.”14 “The circuit court overruled LG Chem’s motion….”15 “This Court now makes its preliminary writ permanent and directs the circuit court to vacate its order overruling LG Chem’s motion to dismiss.”16
‘“Personal jurisdiction comes in two forms: general and specific. See Bristol-Myers Squibb Co. v. Super. Ct. of Cal., S.F. Cty., 137 S. Ct. 1773, 1779-80 (2018). ‘A court with general jurisdiction may hear any claim against [the] defendant, even if all the incidents underlying the claim occurred in a different [s]tate.’ Id. at 1780.”17 “By contrast, to assert jurisdiction over an out-of-state defendant without due process, a court typically must possess specific personal jurisdiction over the defendant. See Bristol-Myers, 137 S.Ct. 1780. For a state court to exercise specific personal jurisdiction over an out-of-state defendant consistent with due process, ‘“the suit’ must ‘arise out of or relate to the defendant’s contacts with the forum.’” Id.”18
In Bristol-Myers, the Supreme Court explained, for a state court to exercise specific personal jurisdiction over an out-of-state defendant, there must be “an affiliation between the forum and the underlying controversy, principally . . . an occurrence that takes place in the forum State.” 137 S. Ct. at 1781. Bishop contends Missouri courts exercising specific personal jurisdiction over LG Chem in this matter would not violate due process because the sale of the subject battery into Missouri is an “occurrence” out of which his lawsuit directly arose. But Bishop overlooks that the battery’s sale was made by an independent third party, not by LG Chem.19
Bishop seeks to create the inference that LG Chem must have known its batteries were being sold into Missouri based on the sheer number of model 18650 batteries produced and sold by LG Chem to a third party then shipped into the United States by that third party. Bishop, therefore, argues it was foreseeable that LG Chem batteries would make their way to Missouri and cause injury in this state. But “’foreseeability’ alone has never been a sufficient benchmark for personal jurisdiction under the Due Process Clause.” World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 295 (1980).20
“Because that sale of LG Chem’s batteries into Missouri by an independent third party is the only contact between LG Chem and Missouri that Bishop alleges, Bishop has failed to establish LG Chem has sufficient minimum contacts with Missouri to allow Missouri courts to assert specific personal jurisdiction over LG Chem consistent with due process.”21
In a footnote, the Court addressed Bishop’s request to conduct jurisdictional discovery and stated:
Because this Court’s writ “extended solely to the circuit court’s overruling of [LG Chem]’s motion to dismiss,” however, Bishop can still make his request for jurisdictional discovery to the circuit court, which did not previously address that request when it overruled LG Chem’s motion to dismiss on the merits. Bayer, 586 S.W.3d at 229. Consistent with this Court’s holding in Bayer, the circuit may consider Bishop’s alternative request after it vacates its order overruling LG Chem’s motion to dismiss. Cf id. (‘It is for circuit court in the first instance . . . to evaluate whether the requested discovery is necessary.”).22
UPON TIMELY FILING OF A MOTION TO REVIVE JUDGMENT, JUDGMENT DEBTOR MUST SHOW CAUSE WHY IT SHOULD NOT BE REVIVED
Capitol Financial Group, LLC (“Capitol Financial”) appeals from the circuit court’s judgment denying Capitol Financial’s motion to revive a default judgment entered in its favor and against David C. Bray (“Bray”). Capitol Financial contends the circuit court erred in refusing to revive the judgment based on its finding that Capitol Financial had failed to rebut the presumption of payment and satisfaction under Section 516.350.1, RSMo. (cum. Supp. 2017). We reverse and remand for revival of the default judgment entered in favor of Capitol Financial.23
Capitol Financial Group v. Bray.
“In October of 2007, Capitol Financial filed a petition for breach of contract against Bray to recover the outstanding principal balance on Bray’s credit card, which totaled $6,034.06. On December 5, 2007, the circuit court of Lincoln County entered a default judgment against Bray for $9,489.02, which included the credit card balance, interest, attorney’s fees, and court costs. On November 30, 2017, Capitol Financial filed a motion to revive this judgment in the circuit court of Lincoln County pursuant to Rule 74.09.”24
“Bray was personally served with a show cause order on July 2, 2018. At the show-cause hearing … Bray argued that no competent evidence existed to show the judgment was unsatisfied because Capitol Financial’s motion, which stated the judgment remained unsatisfied, was not verified or supported by the affidavit.”25 “[T]he circuit court denied Capitol Financial’s motion to revive the judgment after finding no ‘substantial or credible evidence before the court sufficient to rebut the presumption of payment and satisfaction’ set forth in Section 516.350.1.”26
Here, the circuit court erred in refusing to revive the default judgment because Capitol Financial timely filed its motion to revive and Bray failed to show cause why the judgment should not be revived. As outlined in Rule 74.09(a), Capitol Financial timely filed its motion to revive on November 30, 2017, which was within ten years of entry of the original default judgment from December 5, 2007. See Mo. R. Civ. P. 74.09(a). Following Rule 74.09(b), the circuit court then entered an order to show cause as to why the judgment should not be revived, of which Bray was personally served. See Mo. R. Civ. 74.09(b). Bray subsequently failed to show cause at the hearing why the judgment against him should not be revived. Therefore, under the mandates of Rule 74.09(c), the default judgment must be revived. See Mo. R. Civ. P. 74.09(c).
Bray failed to show cause why the judgment should not be revived because he failed to assert one of the limited defenses available to judgment debtors. Elliot [v. Cockrell], 943 S.W.2d at 329 [(Mo. App. E.D. 1997)]. The only available defenses to revival of a judgment are those concerning “whether the judgment creditor initiated the proceeding within the prescribed time of ten years; whether service, either personal or by publication, was obtained on the judgment debtor; whether the judgment existed; and whether the judgment was satisfied.” Id. at 330.27
At the show-cause hearing, “Bray … argued that the judgment creditor bore the burden of establishing the judgment remained unsatisfied. Bray’s argument was not a permissible objection to Capitol Financial’s motion to revive the judgment. See id.”28
“Missouri courts have consistently rejected that a party seeking revival under Rule 74.09 bears any burden apart from timely filing a motion to revive the judgment.”29
Rule 74.09(c) provides that, if the judgment debtor fails to show cause why the judgment should not be revived, “the court shall enter an order reviving the judgment.” Mo. R. Civ. P. 74.09 (c). Under Missouri law, the use of the work ‘shall’ is “indicative of a mandate to act” and removes any discretion. Hank [v. Rees], 943 S.W.2d at 4 [(Mo. App. S.D. 1997)]. Therefore, following the dictates of Rule 74.09, the circuit court was obligated to revive the judgment in favor of Capitol Financial.30
SUMMARY JUDGMENT AFFIDAVIT MUST BE BASED ON PERSONAL KNOWLEDGE
“Dominic Jones (Jones) appeals the trial court’s summary judgment in favor of Gateway Metro Federal Credit Union (Gateway) on Gateway’s suit on a promissory note and Jones’ counterclaim for unjust enrichment. Because we find the evidence in the summary judgment record did not establish the balance that remains due on the promissory note, an element of Gateway’s claim, we must reverse the summary judgment in favor of Gateway on the promissory note.”31
Gateway Metro Federal Credit Union v. Dominic Jones
Gateway filed suit to collect on a promissory note signed by Jones. “In its statement of uncontroverted material facts attached to its motion for summary judgment, Gateway claimed that … the principal balance on the Note was $333,962.21, the interest balance was $175,306.09, and the late fee balance was $13,350.48. Gateway attached an affidavit executed by Lisa Ellison (Ellison affidavit), Respondent’s Vice President of Risk Management, to support these facts.”32
“Jones argues that the Ellison affidavit is invalid because it is not based on personal knowledge. We agree that the Ellison affidavit, which was the only evidence offered to show Jones’ default and the amount due on the 2008 Note, was insufficient to establish a prima facie right to summary judgment in favor of Gateway.”33
While an affidavit need not contain a particular “magic phrase” in order to establish that it is made on personal knowledge, the averments should still demonstrate that the affiant has personal knowledge of the matters contained in the affidavit. See Scott v. Ranch Roy-L, Inc., 182 S.W.3d 627, 635 (Mo. App. E.D. 2005); see also May & May Trucking, L.L.C. v. Progressive Nw. Ins. Co., 429 S.W.3d 511, 515 (Mo. App. W.D. 2014). On the other hand, “[a]n affidavit which relates information gained from other documents relates hearsay, not such facts as would be admissible in evidence, and is not sufficient to support a motion for summary judgment.” Perry v. Kelsey-Hayes Co., 728 S.W.2d 278, 280 (Mo. App. W.D. 1987).… In such a case, if the documents themselves qualify as business records, a party may submit them through use of a business records affidavit to avoid any hearsay issues. Section 490.692, (RSMo. 2000).34
While Ellison avers that she has gained knowledge of the facts set forth in her affidavit, it is clear from the first three paragraphs of her affidavit that her knowledge has come exclusively from the business records of Gateway that she reviewed. However, rather than attach the records containing the information Ellison relies, Gateway submitted only this affidavit. Because it contains information gained from records, rather than Ellison’s personal knowledge, it relates hearsay and does not sufficiently support a motion for summary judgment. Perry, 728 S.W.2d at 280.35
“In summary judgments on suits on accounts, even where affiants claim to have personal knowledge of the balances due, the parties typically attach records verifying such balance to the affidavit. Student Loan Marketing Ass’n v. Raja, 878 S.W.2d 830, 831 (Mo. App. W.D. 1994) (affidavit attached copies of notes and payment records)….”36 “Likewise, Rule 74.04(c) mandates that any records referred to by the affiant must be attached to the affidavit.”37
1 W. Dudley McCarter, a former president of The Missouri Bar, is a partner in the St. Louis law firm of Behr, McCarter & Potter, P.C.
2 Hill v. Freedman, No. WD82657 (Mo. App. W.D. 2020).
11 State ex rel. LG Chem LTD v. McLaughlin, No. SC97991 (Mo. banc 2020).
23 Capitol Financial Group v. Bray, No. ED108066 (Mo. App. E.D. 2020).
31 Gateway Metro Federal Credit Union v. Dominic Jones, No. ED108286, 2020 WL 3053292 (June 9, 2020).
32 Id. at *1.
33 Id. at *2.
34 Id. at *3.
35 Id. at *4.
36 Id. at *5.