Barnett v. Columbia Maint. Co.

632 S.W.3d 396

Harold BARNETT, Respondent,

v.COLUMBIA MAINTENANCE COMPANY, et al., Respondents,AMCO Insurance Company and Depositors Insurance Company, Appellants.

No. ED 109008

Missouri Court of Appeals, Eastern District, DIVISION THREE.

Filed: June 29, 2021

Motion for Rehearing and/or Transfer to Supreme Court Denied August 10, 2021

Application for Transfer Denied October 26, 2021

Angela T. Quigless, Judge

AMCO Insurance Company and Depositors Insurance Company (collectively "Insurers") appeal the circuit court's order denying their motion to intervene in a proceeding to confirm an arbitration award. Insurers sought to contest confirmation of the award, which was entered in favor of Harold Barnett and against Insurers’ policy holders. Finding that the circuit court did not err, and that certain of Insurers’ points are not properly before this Court, we affirm.

Factual and Procedural Background

Terminated from his job, Barnett sued his employer, Columbia Maintenance Company, and William Hausman, the president and sole owner of Columbia Maintenance Company (collectively "Defendants"), alleging violations of the Missouri Human Rights Act, as well as negligent infliction of emotional distress ("MHRA Action"). Insurers, who had issued commercial general liability and umbrella polices to Defendants, denied coverage and refused to defend Defendants. Insurers then filed a declaratory judgment action in federal court, seeking a declaration that under the terms, conditions, and exclusions of Defendants’ policies, Insurers had no duty to defend or to indemnify Defendants against Barnett's MHRA Action.

After Insurers denied coverage and refused to defend Defendants, Barnett and Defendants entered into a contract pursuant to Section 537.065, which in part limited recovery to insurance proceeds ("537 Agreement"). Barnett notified Insurers of this contract on August 13, 2019. Five days later, Insurers moved to intervene in the MHRA Action. The circuit court granted intervention, and requested that the parties file memorandums concerning the extent to which Insurers could conduct discovery and participate in trial. After receiving those memorandum, the circuit court issued an order, dated October 4, 2019, in which the court stated that Insurers "must accept this lawsuit as they find it at the time of their intervention," and then ordered that Insurers "have the same rights and responsibilities as any other party to this litigation, which includes conducting discovery and participating in trial" ("October 2019 Order").

Barnett dismissed the MHRA Action, without prejudice, on January 30, 2020, and proceeded to binding arbitration with Defendants. Insurers were extended invitations to participate in that arbitration, but declined to do so. The arbitrator issued his award on April 29, 2020, in favor of Barnett and against Defendants in the total amount of $11,437,009.90 ("Arbitration Award"). The arbitrator described Defendants’ actions as "one of the most egregious and blatant Missouri Human Rights case violations" that the arbitrator had ever seen. Barnett filed his application to confirm the award with the circuit court on May 1, 2020 ("Confirmation Proceeding"). Defendants responded, stating they had no objection to judgment being entered on the award.

Insurers moved to intervene in the Confirmation Proceeding on May 8, 2020. Insurers sought to intervene both as of right and by permissive intervention, pursuant to Rule 52.12, to contest confirmation of the Arbitration Award ("Motion to Intervene"). They also filed a motion to deny and/or dismiss the application for approval of the Arbitration Award on May 19, 2020 ("Motion to Dismiss"). The circuit court denied Insurers’ Motion to Intervene.

Insurers now advance nine points on appeal, alleging the circuit court erred in denying intervention, and in denying or implicitly denying their Motion to Dismiss. We address each point, but note that the issues raised by Insurers have largely been decided by Britt v. Otto , 577 S.W.3d 133 (Mo. App. W.D. 2019), Aguilar v. GEICO Cas. Co. , 588 S.W.3d 195 (Mo. App. W.D. 2019), and this Court's recent decision, Loveland v. Austin , ED108859, 626 S.W.3d 716 (Mo. App. E.D. April 13, 2021).

Discussion

Points I and II: Intervention of Right

In their first two points on appeal, Insurers allege the circuit court misapplied Rule 52.12(a) in denying their Motion to Intervene in the Confirmation Proceedings as a matter of right.¹ Rule 52.12(a) states:

Intervention of Right . Upon timely application anyone shall be permitted to intervene in an action: (1) when a statute of this state confers an unconditional right to intervene or (2) when the applicant claims an interest relating to the property or transaction that is the subject of the action and the applicant is so situated that the disposition of the action may as a practical matter impair or impede the applicant's ability to protect that interest, unless the applicant's interest is adequately represented by existing parties.

Insurers claim a right to intervention pursuant to Rule 52.12(a)(1) because an unconditional right to do so is conferred by Section 537.065.2. Insurers claim a right to intervene pursuant to Rule 52.12(a)(2) because they had an interest in the Confirmation Proceeding and were so situated that disposition of the Confirmation Proceeding impaired or impeded their ability to protect their interests, which were not represented by the existing parties.

We address each claim in turn. "In reviewing the circuit court's denial of intervention as of right, we consider the facts in the light most favorable to the court's judgment." Britt , 577 S.W.3d at 136 n.3 (internal quotation omitted). We will affirm the circuit court's decision unless there is no substantial evidence to support it, it is against the weight of the evidence, or it erroneously declares or applies the law. State ex rel. Koster v. ConocoPhillips Co. , 493 S.W.3d 397, 403 (Mo. banc 2016) ; see also Britt , 577 S.W.3d at 139.

Intervention as a Matter of Right Pursuant to Rule 52.12(a)(1)

Insurers claim they were entitled to intervene in the Confirmation Proceeding as a matter of right pursuant to Rule 52.12(a)(1) because Section 537.065.2 conferred the unconditional right to do so. Section 537.065.1 allows any person with an unliquidated claim for damages to enter into a contract with a tortfeasor to limit the tort-feasor's liability for a judgment to specified assets, including insurance contracts. Britt , 577 S.W.3d at 140 ; see also, Schmitz v. Great Am. Assurance Co. , 337 S.W.3d 700, 709 (Mo. banc 2011). The right to enter into a section 537.065.1 contract limiting the tort-feasor's liability to an insurance contract is conditioned on the tort-feasor's insurer being afforded the opportunity to defend the tort-feasor and refusing to do so without reservation. Britt , 577 S.W.3d at 140. Section 537.065.2 then describes when a judgment can be entered against a tort-feasor who has entered into a Section 537.065.1 contract:

Before a judgment may be entered against any tort-feasor after such tort-feasor has entered into a contract under this section, the insurer or insurers shall be provided with written notice of the execution of the contract and shall have thirty days after receipt of such notice to intervene as a matter of right in any pending lawsuit involving the claim for damages .

(Emphasis added).

Insurers claim this statutory right to intervene applies to the Confirmation Proceeding. In essence, Insurers seek to expand the statutory language to mean insurers have thirty days to intervene after receiving notice of a confirmation proceeding. This same argument was rejected in Aguilar , Britt , and Loveland .

Any time this Court is called upon to apply a statute, our primary obligation is to ascertain the intent of the legislature from the language used, and to give effect to that intent if possible. Hixson v. Missouri State Highway Patrol , 611 S.W.3d 923, 926 (Mo. App. E.D. 2020). We do so by considering the words used in their plain and ordinary meaning. Id. We examine the language used by the legislature, and do not supply what the legislature has omitted by engrafting additional language into the statute. Missouri State Conference of Nat'l Ass'n for the Advancement of Colored People v. State , 607 S.W.3d 728, 733 (Mo. banc 2020). "In statutory construction, courts must give effect to the statute as written and cannot add provisions which do not appear either explicitly or by implication." Garza v. Valley Crest Landscape Maint., Inc. , 224 S.W.3d 61, 64 (Mo. App. E.D. 2007).

From examining the plain and ordinary language of Section 537.065.2, it is clear the statute only allows an insurer to intervene as a matter of right provided the insurer files its motion to intervene within thirty days after receiving notice of an agreement executed pursuant to Section 537.065.1. Barnett provided the required notice of the 537 Agreement to Insurers on August 13, 2019. Though Insurers timely filed a motion to intervene in the MHRA Action that was pending at the time, that action was voluntarily dismissed, and Barnett and Defendants proceeded to arbitration. Barnett filed his application to confirm the arbitration award on May 1, 2020. Insurers filed their Motion to Intervene in the Confirmation Proceeding seven days later, on May 8, 2020. Though filed days after commencement of the Confirmation Proceeding, Insurers’ motion was nonetheless filed almost nine months after notice of the 537 Agreement - far outside the statute's thirty-day limit. Insurers did not file their Motion to Intervene within thirty days of receipt of written notice of the 537 Agreement, and thus Insurers’ motion was untimely.

Even assuming the Confirmation Proceeding qualified as a "pending lawsuit involving the claim for damages" (an issue we need not decide), it was not pending during the thirty-day time period after Barnett gave written notice of the 537 Agreement...