Platte County, Missouri v. UMB Bank, N.A., The Trustee of the Transportation Refunding an Improvement Bonds (Zona Rosa Retail Project) Series, 2007

        IN THE MISSOURI COURT OF APPEALS
                WESTERN DISTRICT
PLATTE COUNTY, MISSOURI,                    )
                                            )
              Respondent,                   )
                                            )
v.                                          )      WD83232
                                            )
UMB BANK, N.A., THE TRUSTEE                 )      Opinion filed: August 25, 2020
OF THE TRANSPORTATION                       )
REFUNDING AND IMPROVEMENT                   )
BONDS (ZONA ROSA RETAIL                     )
PROJECT) SERIES, 2007,                      )
                                            )
              Appellant.                    )

     APPEAL FROM THE CIRCUIT COURT OF PLATTE COUNTY, MISSOURI
            THE HONORABLE JAMES W. VAN AMBURG, JUDGE

                    Division Two: Karen King Mitchell, Presiding Judge,
                Anthony Rex Gabbert, Judge and W. Douglas Thomson, Judge

       UMB Bank, N.A. (“Trustee”) appeals from the trial court’s grant of summary judgment

(“Judgment”) in favor of Platte County, Missouri (“County”) and against Trustee finding that the

financing agreement (“Financing Agreement”) does not contain any promise by the County to pay

shortfalls for the Transportation Refunding and Improvement Bonds (“Zona Rosa Retail Project”)

Series 2007 (“Zona Rosa Bonds”). On appeal, Trustee claims the trial court erred in its Judgment

because the County made a conditional promise to pay shortfalls for the Zona Rosa Bonds in the

Financing Agreement. We find that the plain language of the Financing Agreement does not

contain a promise by the County to pay for the shortfalls for the Zona Rosa Bonds. We affirm.
                                      Factual and Procedural History
        The material facts are not in dispute. On October 1, 2007, the Industrial Development

Authority of Platte County (“Development Authority”) issued the Zona Rosa Bonds in the amount

of $32,200,000. The Zona Rosa Bonds refunded the outstanding amount of the series 2003 bonds

(which was $18,610,000) and provided funding for the construction of parking garages at Zona

Rosa Town Center (“Zona Rosa”), an outdoor shopping mall located in Platte County, Missouri.

The Zona Rosa Bonds are revenue bonds.

        On the same date and in connection with the issuance of the Zona Rosa Bonds, the

Development Authority executed the Trust Indenture with Trustee and the Financing Agreement

with the County, and Platte County, Missouri South Transportation Development District I and

District II (“Districts I and II”). Pursuant to the Trust Indenture, Trustee agreed to undertake

certain duties and responsibilities as corporate trustee of the Zona Rosa Bonds and represents the

interests of the holders of the Zona Rosa Bonds (“Bondholders”). Under the terms of the Trust

Indenture and the Financing Agreement, the Development Authority assigned its rights under the

Financing Agreement to Trustee.

        The Financing Agreement is a fully integrated contract 1 which provides the source of

revenue used to pay the principal and interest on the Zona Rosa Bonds. The County is a first-class

county without a charter government, governed by a County Commission composed of three

elected commissioners. Districts I and II are special taxing districts formed under state law to

support transportation-related retail projects like the parking garages at Zona Rosa. Pursuant to

the Financing Agreement, the Zona Rosa Bonds are paid from revenues generated by a 1% sales


         1
           “An integrated agreement simply means that the writing in question is a complete statement of the bargain
made between the parties.” Centerre Bank of Kansas City, N.A. v. Distributors, Inc., 705 S.W.2d 42, 51 (Mo. App.
W.D. 1985) (citing 4 Williston, Contracts, § 636 (3rd ed. 1961)). “The reason for the rule, of course, is that the
parol evidence rule only prohibits evidence of prior or contemporaneous agreements which vary or contradict the
terms of an unambiguous and complete writing.” Id.

                                                         2
tax collected by Districts I and II on retail sales within their respective boundaries, which includes

Zona Rosa. The County does not control or operate Districts I or II. Instead, Districts I and II are

distinct legal entities that collect the 1% sales tax at Zona Rosa. Article II of the Financing

Agreement outlines the obligations of the County, which provides:

        Section 2.2. Annual Appropriations. The County intends, on or before the last
        day of each Fiscal Year, to budget and appropriate, specifically with respect to this
        Agreement, moneys sufficient to pay the Appropriation Amount2 for the next
        succeeding Fiscal Year. The County shall deliver written notice to the Trustee no
        later than 15 days after the commencement of its Fiscal Year stating whether or not
        the County Commission has appropriated funds in an amount equal to the
        Appropriation Amount estimated to become due during such Fiscal Year.
        Notwithstanding any provision in the Indenture or herein to the contrary, if the
        Letter of Credit is in effect, the parties hereto agree that such Letter of Credit shall
        be drawn on prior to any payment of the Appropriation Amount by the County.

        Section 2.3. Annual Budget Request. The County further covenants that its
        responsible financial officer3 shall do all things lawful within his power to obtain
        and maintain funds from which the Appropriation Amount may be paid, including
        making provision for such payments to the extent necessary in each proposed
        budget or appropriation request submitted for adoption in accordance with
        applicable provisions of law and to exhaust all available reviews and appeals in the
        event such portion of the budget or appropriation request is not approved; it being
        the intention of the County that the decision to appropriate or not to appropriate
        under this Agreement shall be made solely by the County Commission and not by
        any other official of the County.

        Section 2.4. Appropriation to Constitute Current Expenses. The parties hereto
        acknowledge and agree that the Appropriation Amount shall constitute currently
        budgeted expenditures of the County and shall not in any way be construed or
        interpreted as creating a liability or a general obligation or debt of the County in
        contravention of any applicable constitutional or statutory limitations or
        requirements concerning the creation of indebtedness by the County, nor shall
        anything contained herein constitute a pledge of the general credit, tax revenues,
        funds or moneys of [the] County. The County’s obligations under this Agreement
        shall be from year to year only, and shall not constitute a mandatory payment
        obligation of the County in any ensuing Fiscal Year beyond the then current Fiscal
        Year.


        2
          The Appropriation Amount is the entire principal and interest to be paid by the Trustee to the Zona Rosa
Bondholders in a given year.
        3
          The “responsible financing officer” identified in section 2.3 of the Financing Agreement is the Platte
County Auditor (“Auditor”).

                                                         3
(Emphasis added).

       In addition to the 1% sales tax, Trustee and Zona Rosa Development, Inc., (“Developer”)

executed a Developer Guaranty Agreement under which Developer was obligated to post a

$500,000 Letter of Credit that could be drawn on by the Trustee as security for the Zona Rosa

Bonds. Under sections 3.10 and 4.10 of the Financing Agreement Districts I and II were to

guarantee the availability of the Letter of Credit and, as necessary, post it themselves if the

Developer failed to post or maintain it. Under the Trust Indenture, the Development Authority

also established a $3.1 million Reserve Fund which could be used for payment on the Zona Rosa

Bonds. The Reserve Fund had a balance of $3,030,920.38 on December 3, 2018.

       Shortfalls occurred in the payment of the Zona Rosa Bonds. Until 2017, the Developer

used its own private funds to cover the annual shortfall in revenue for payment on the Zona Rosa

Bonds. On or about November 16, 2017, the Trustee drew on the $500,000 Letter of Credit

originally posted by the Developer. In a letter dated November 22, 2017, the Trustee informed the

County that the Letter of Credit had been drawn on but did not make demand on the County to pay

the Zona Rosa Bonds. On November 29 and December 13, 2017, the Trustee made a written

demand to the Developer to replenish the Letter of Credit but the Developer did not comply. In

February 2018, Trustee notified Developer that legal action would be taken if a replacement Letter

of Credit was not in place by April 2018. Trustee also demanded that Districts I and II replace the

Letter of Credit. The Letter of Credit was not replaced by the Developer or Districts I and II. In

September 2018, the Developer sold its interest in Zona Rosa to Monarchs Sub, LLC

(“Monarchs”). Trustee made demand on Monarchs to replace the Letter of Credit but Monarchs

did not comply. Trustee did not take any legal action against Developer, Monarchs, or Districts I

and II but informed the Bondholders that these entities were in default.



                                                4
        On September 24, 2018, approximately a year after drawing on the Letter of Credit, Trustee

sent the County written notice of default under the Financing Agreement threatening to sue the

County unless it issued a binding written commitment to pay the revenue shortfall on the debt

service due December 1, 2018.4 On or about October 12, 2018, the Trustee informed the County

and Districts I and II, along with the Developer and the Development Authority, that “there is a

shortfall of $1,015,257.66.” On November 2, 2018, the County filed a petition for declaratory

relief against Trustee and the Development Authority5 seeking declaration of its legal obligations

with respect to the Zona Rosa Bonds pursuant to the Financing Agreement. Prior to filing its

answer, Trustee filed a petition for temporary restraining order requesting that the court order the

County to pay the full amount of the appropriation made by the County in its 2018 budget

regarding the Zona Rosa Bonds. On November 30, 2018, the court held a hearing on Trustee’s

petition for a temporary restraining order at which Trustee stated that the amount of the shortfall

on the payment to Bondholders due December 1, 2018, was $838,594.00, which was later revised

to $765,390.95. The trial court denied Trustee’s petition for a temporary restraining order but

ordered the County to reserve $765,390.95 for purposes of this litigation which the County

designated as restricted funds within its general reserve fund.




         4
           Prior to 2018, Trustee never made a demand on the County to pay a shortfall. Pursuant to the Financing
Agreement, from 2008 to 2018, the Auditor proposed and the County budgeted and appropriated the full amount of
principal and interest to be paid by the Trustee to Bondholders. The County fund from which payment could be
made for the Zona Rose Bonds is the “Zona Rosa TDD Fund,” which is categorized as a debt service fund. The
County operates on a ledger system, which means potential expenditures are paid out of a general fund, special
revenue funds or debt service funds. The appropriations made in 2008 through 2018, did not result in any transfer of
money or funds from the County’s general fund to the Zona Rosa TDD Fund. There has never been a cash balance
in the County treasury to the credit of the Zona Rosa TDD Fund; it has always had a zero cash balance. From 2007
until 2018, the County was never asked to make any payment regarding the Zona Rosa Bonds. The County has
never made a payment to Trustee related to the Zona Rosa Bonds.
         The County Commission makes final appropriation of funds by issuing its Warrant. The County
Commission has never made final appropriation by issuing its Warrant for payment of funds from the general fund
or the general reserve fund to the Zona Rosa TDD Bond Fund.
         5
           The County voluntarily dismissed the Development Authority on December 17, 2018.

                                                         5
       The County filed a motion for summary judgment. Trustee filed an opposition to the

County’s motion for summary judgment and cross-motion for summary judgment. The trial court

entered its Judgment in favor of the County finding that the County was not liable on the Zona

Rosa Bonds as the County did not promise to make payments on the Zona Rosa Bonds in the

Financing Agreement. Specifically, the trial court made the following findings:

       1. In 2007, the Development Authority . . . issued bonds to finance the
          construction of garages within Zona Rosa. . . . The Development Authority is
          a distinct legal entity from Platte County. State ex rel Jardon v. Industrial Dev.
          Auth. of Jasper Cnty, 570 S.W.2d 666, 677 (Mo. banc 1978).

       2. On October 1, 2007, the Development Authority entered into a Financing
          Agreement with [Districts I and II] to provide revenue for the Zona Rosa Bonds
          using a 1% sales tax in Zona Rosa. Platte County also entered into the
          Financing Agreement.

       3. In its Petition, Platte County asks the Court to make certain declarations
          regarding the Financing Agreement. The Development Authority’s interests in
          the Financing Agreement have been assigned to [Trustee], which represents the
          holders of the Zona Rosa Bonds as Trustee.

       4. The Court finds that the Financing Agreement is a fully integrated contract
          entered into between parties. It is to be construed in accordance with its express
          terms. [Section] 432.070; Gill Const., Inc. v. 18th & Vine Auth., 157 S.W.3d
          699, 708 (Mo. App. 2004). The Court further finds that the declarations sought
          by Platte County involve legal issues that are appropriately resolved on
          summary judgment. Webbe v. Keel, 369 S.W.3d 755, 756 (Mo. App. 2012).

       5. In Section 2.3 of the Financing Agreement, Platte County covenanted that, each
          year, the Platte County Auditor would include within its proposed budget a
          potential payment for the Zona Rosa Bonds. The Court finds that this is an
          express promise that is not illusory. See Moschenross v. St. Louis Cnty, 188
          S.W.3d 13, 21 (Mo. App. 2006) (agreement was “to request annual
          appropriations for repayment of the bonds, subject to approval of the county
          council.”). Accordingly, each year, the Auditor should include within its
          proposed budget a potential payment for the Zona Rosa Bonds.

       6. There is no promise or requirement in the Financing Agreement that the County
          Commission must accept the Auditor’s proposed budget and appropriate for a
          potential payment. To the contrary, Section 2.3 of the Financing Agreement
          recognizes that the County Commission may decide each year whether to
          appropriate or not to appropriate for a potential payment on the Zona Rosa

                                                6
             Bonds. This is consistent with Missouri law. Scroggs v. Kansas City, 499
             S.W.2d 500, 505 (Mo. 1973) (indicating that an agreement would be prohibited
             if “it requires continuing future appropriations . . . .”).

         7. Similarly, there is no promise or requirement in the Financing Agreement for
            Platte County to make payment on the Zona Rosa Bonds. In fact, in Section
            2.4, the Financing Agreement specifically states that it “shall not in any way be
            construed or interpreted as creating a liability or a general obligation or debt of
            the County . . . nor shall anything contained herein constitute a pledge of the
            general credit, tax revenues, funds or moneys of County.” The Trustee has
            admitted that the bonds are not secured by the full faith and credit and taxing
            power of Platte County.

         8. Because the Financing Agreement does not contain any promise by Platte
            County to appropriate or pay shortfalls for the Zona Rosa Bonds, voter approval
            for county indebtedness was not required under Article VI, Section 26(b) of the
            Missouri Constitution. See Scroggs v. Kansas City, 499 S.W.2d 500, 505 (Mo.
            1973). For the same reason, there is no violation of [section] 50.660 because
            there is no “contract . . . imposing any financial obligation” on Platte County.
            Lastly, there is no violation of [section] 349.080 because, under the terms of the
            Financing Agreement, Platte County is not liable on the bonds issued by the
            Development Authority.6

         Trustee filed a motion to amend the Judgment requesting the trial court to direct that the

County pay $765,390.95 to Trustee for the 2018 shortfall; to address the County’s burden for

summary judgment; and enter summary judgment in favor of Trustee for reasons that it argued in

its previously filed pleadings. By operation of law, Trustee’s motion was deemed denied when

the trial court did not rule on it within ninety days pursuant to Rule 78.06.7 Trustee appeals.




          6
            We note that both parties in their respective pleadings request attorneys’ fees in their prayers for relief.
The trial court’s judgment did not dispose of these requests, “which ‘can arrest the finality of the judgment,’ and
implicate this Court’s jurisdiction to hear the appeal.” Union Manor v. Missouri Dep’t of Health and Senior Servs.,
596 S.W.3d 673, 677 n.2 (Mo. App. W.D. 2020) (quoting Ruby v. Troupe, 580 S.W.3d 112, 114 (Mo. App. W.D.
2019)). A trial court’s “failure to address an attorneys’ fees issue will impact the finality of the judgment only when
the claim is properly pleaded and pursued by the requesting party. Under the first step, ‘a party must plead a basis
for an award of fees, in addition to simply including a request for attorneys’ fees in its prayer for relief.’” Id.
(citation omitted). Here, each party only states a bare request for attorneys’ fees without citing any authority for
such an award; thus, the request for attorneys’ fees was not properly pleaded. Id. Nor does it appear that any party
pursued its request for attorneys’ fees beyond merely mentioning it in their respective petitions or answer. Id.
“Under Ruby, this is an additional independent reason for deeming the [trial] court’s judgment final and appealable,
notwithstanding its failure to address the issue of attorneys’ fees.” Id.
          7
            All references to Rules are to Missouri Rules of Civil Procedure (2020), unless otherwise indicated.

                                                           7
                                        Standard of Review

       “Appellate review of the grant of summary judgment is essentially de novo.” Newton v.

Mercy Clinic E. Communities, 596 S.W.3d 625, 628 (Mo. banc 2020). “‘The criteria on appeal

for testing the propriety of summary judgment are no different from those which should be

employed by the trial court to determine the propriety of sustaining the motion initially.’” Id.

(citation omitted). “This Court reviews the record in the light most favorable to the party against

whom judgment was entered.” Id. “‘Summary judgment is appropriate when the moving party

has [established], on the basis of facts as to which there is no genuine dispute, a right to judgment

as a matter of law.’” Id. (quoting Am. Fed'n of Teachers v. Ledbetter, 387 S.W.3d 360, 362-63

(Mo. banc 2012)).

                                              Analysis

       As asserted by Trustee in its oral argument, this is a simple contract case in which the terms

of the contract, the Financing Agreement, are clear and unambiguous on its face. Trustee raises

six points on appeal. As Points I through V are based on Trustee’s assertion that the Financing

Agreement contains a promise by the County to pay the shortfall for the Zona Rosa Bonds, we

begin with an analysis of the County’s obligations under the Financing Agreement.

       “‘The interpretation of a contract is a question of law.’” Nodaway Valley Bank v. E.L.

Crawford Const., Inc., 126 S.W.3d 820, 825 (Mo. App. W.D. 2004) (citation omitted). “The

cardinal rule of contract interpretation is to ascertain the parties’ intentions and to give effect to

that intention.” Care Center of K.C. v. Horton, 173 S.W.3d 353, 355 (Mo. App. W.D. 2005). “To

do that, this court is to rely on the plain and ordinary meaning of the words in the contract and

‘consider the document as a whole.’” Nodaway Valley Bank, 126 S.W.3d at 825 (citation omitted).

“If a contract is unambiguous, ‘the intent of the parties is to be discerned from the contract alone’



                                                  8
based on the plain and ordinary meaning of the language used.” Whelan Sec. Co v. Kennebrew,

379 S.W.3d 835, 846 (Mo. banc 2012) (citation omitted). “Mere disagreement over the meaning

of a contract does not signal an ambiguity.” Goldstein and Price, L.C. v. Tonkin & Mondl, L.C.,

974 S.W.2d 543, 552 (Mo. App. E.D. 1998).

       Here, as agreed by Trustee at oral argument, the contract language addressing the County’s

obligations is not ambiguous. Article II of the Financing Agreement provides:

       Section 2.2. Annual Appropriations. The County intends, on or before the last
       day of each Fiscal Year, to budget and appropriate, specifically with respect to this
       Agreement, moneys sufficient to pay the Appropriation Amount for the next
       succeeding Fiscal Year. The County shall deliver written notice to the Trustee no
       later than 15 days after the commencement of its Fiscal Year stating whether or not
       the County Commission has appropriated funds in an amount equal to the
       Appropriation Amount estimated to become due during such Fiscal Year.
       Notwithstanding any provision in the Indenture or herein to the contrary, if the
       Letter of Credit is in effect, the parties hereto agree that such Letter of Credit shall
       be drawn on prior to any payment of the Appropriation Amount by the County.

       Section 2.3. Annual Budget Request. The County further covenants that its
       responsible financial officer shall do all things lawful within his power to obtain
       and maintain funds from which the Appropriation Amount may be paid, including
       making provision for such payments to the extent necessary in each proposed
       budget or appropriation request submitted for adoption in accordance with
       applicable provisions of law and to exhaust all available reviews and appeals in the
       event such portion of the budget or appropriation request is not approved; it being
       the intention of the County that the decision to appropriate or not to appropriate
       under this Agreement shall be made solely by the County Commission and not by
       any other official of the County.

       Section 2.4. Appropriation to Constitute Current Expenses. The parties hereto
       acknowledge and agree that the Appropriation Amount shall constitute currently
       budgeted expenditures of the County and shall not in any way be construed or
       interpreted as creating a liability or a general obligation or debt of the County in
       contravention of any applicable constitutional or statutory limitations or
       requirements concerning the creation of indebtedness by the County, nor shall
       anything contained herein constitute a pledge of the general credit, tax revenues,
       funds or moneys of [the] County. The County’s obligations under this Agreement
       shall be from year to year only, and shall not constitute a mandatory payment
       obligation of the County in any ensuing Fiscal Year beyond the then current Fiscal
       Year.



                                                  9
(Emphasis added).

        The plain and ordinary meaning of the language used in these provisions supports the trial

court’s Judgment that the Financing Agreement does not contain a promise by the County to pay

on the Zona Rosa Bonds. Section 2.2 plainly provides that each year the County intends to budget

for the Appropriation Amount which will be subject to the County Commission’s approval, which

the County Commission may or may not provide. It includes a directive that in the event the

County Commission does not approve the appropriation, the County will notify the Trustee within

fifteen days of the beginning of the fiscal year. It also provides that if the Letter of Credit is in

effect, it must be drawn on prior to any payment by the County. Section 2.3 clearly and

unambiguously provides that each year the Auditor will include a payment for the Zona Rosa

Bonds in its proposed budget or appropriation request and pursue all available appeals in the event

it is not approved. Consistent with the language of section 2.2, section 2.3 expressly provides that

it is the intent of the County that the County Commission solely decides whether “to appropriate

or not appropriate.”        Similarly, section 2.4 clearly and unambiguously provides that the

Appropriation Amount constitutes a budgeted expenditure and not a liability. Section 2.4 also

expressly provides that the County is not pledging County money. There is no promise to pay

expressed in any of these provisions. In fact, the provisions repeatedly state that the decision

whether to pay or not is entirely up to the County Commission and provides directives to take in

the event the County Commission does not approve the proposed appropriation.8 The provisions




         8
           Indeed, it appears Trustee was aware that the Financing Agreement did not bind the County unless the
County Commission took the additional step of appropriating the Appropriation Amount and issuing its Warrant.
On September 24, 2018, Trustee sent the County written notice of default under the Financing Agreement
threatening to sue the County unless the County issued a binding written commitment to pay the revenue shortfall on
the debt service.

                                                        10
are devoid of any requirements on the County Commission to accept the proposed appropriation,

and, in fact, the County Commission never did make final appropriation of funds for this purpose.

        In contrast, sections 3.2(d)(ii)(A) and 4.2(d)(ii)(A) of the Financing Agreement regarding

the obligations of Districts I and II contain language which plainly reflect a promise to pay. In

those sections, the Districts I and II promised to collect the sales tax within their boundaries and

make “[p]ayment to the Trustee of the amount necessary to fund clauses First through Third of

Section 601(b)(6) of the Indenture,” along with other payments related to the Zona Rosa Bonds.

Under section 3.3 and 4.3 of the Financing Agreement, Districts I and II specifically agreed that

appropriated funds “are pledged . . . to payment of District Operating Costs and the Bonds and

shall be transferred . . . to the Revenue Fund at the times and manner provided in [Section 3.2(d)

and Section 4.2(d)].” The provisions of the Financing Agreement pertaining to the County are

different from the provisions pertaining to Districts I and II. Unlike sections 3.2(d) and 4.2(d) of

the Financing Agreement, which pertain to Districts I and II, there is no language in Article II

requiring the County to “disburse the proceeds” or make “payment to the Trustee” of any funds.

Unlike sections 3.3 and 4.3 of the Financing Agreement for Districts I and II, there is no language

in Article II in which funds appropriated by the County in its budget “are pledged . . . to payment

of . . . the Bonds . . . .”

        Our analysis of the plain language of the Financing Agreement is consistent with other

documents executed in conjunction with the issuance of the Zona Rosa Bonds in October 2007.

The Trust Indenture likewise recognizes that the Zona Rosa Bonds “shall not constitute a debt or

liability of the County[.]” Section 202 of the Trust indenture is entitled “Limited Obligations” and

provides:

        The Bonds and the interest thereon shall be special, limited obligations of the
        Authority payable solely out of the Pledged Revenues (including, in certain

                                                11
          circumstances, Bond proceeds, draws on the Letter of Credit and income from the
          temporary investment thereof and moneys on deposit in the Bond Reserve Fund
          and income from the investment thereof) and are secured by a pledge and
          assignment of the Trust Estate to the Trustee in favor of the Registered Owners of
          the Bonds, as provided in this Indenture. The Bonds and the interest thereon shall
          not constitute a debt or liability of the County or of the State or of any political
          subdivision thereof, and the Bonds shall not constitute an indebtedness within the
          meaning of any constitutional or statutory debt limitation or restriction. The
          Authority has no taxing powers.

(Emphasis added). Moreover, in a letter to Trustee and the Development Authority dated October

4, 2007, bond counsel Gilmore & Bell specifically advised the Trustee that under existing law:

          The [Zona Rosa] Bonds do not constitute a debt or liability of the State or of any
          political subdivision . . . and do not constitute a pledge of the full faith and credit
          of the State or of any political subdivision thereof. The issuance of the [Zona Rosa]
          Bonds shall not, directly, indirectly or contingently, obligate the State or any
          political subdivision thereof to levy any form of taxation therefor or to make any
          appropriation for their payment.

          We conclude that the plain language of Financing Agreement does not reflect that the

County made a promise to make payment on the Zona Rosa Bonds.

Point I

          In Point I, Trustee argues that the trial court erred in granting summary judgment in favor

of the County because the County’s promise to pay on the Zona Rosa Bonds in the Financing

Agreement is constitutional because the County had sufficient income and revenue to pay the

amounts promised as required by Article VI, section 26(a) of the Missouri Constitution. In support

of this argument, Trustee offers no analysis of the provisions of the Financing Agreement or states

what language it believes constitutes County’s promise to pay on the Zona Rosa Bonds. Trustee

concludes its argument by stating, “The Circuit Court erred by finding the County’s promises were

unconstitutional, and the summary judgment ruling in favor of the County must be reversed. The

Trustee is entitled to summary judgment as there is no genuine issue as to the material facts.”




                                                    12
         First, this point fails in light of our analysis concluding that the plain language of the

Financing Agreement does not contain a promise to pay by the County. Second, Trustee’s

argument fails because the trial court did not find “the County’s promises were unconstitutional,”

as alleged by Trustee.          The trial court did not find any part of the Financing Agreement

unconstitutional. The trial court did not even mention Article VI, section 26(a) in its Judgment.

Contrary to Trustee’s argument, the trial court found that “Because the Financing Agreement does

not contain any promise by Platte County to appropriate or pay shortfalls for the Zona Rosa

Bonds, voter approval for country indebtedness was not required under Article VI, Section 26(b).”

(Emphasis added.)

         Finally, Trustee simply asserts County made a promise to pay without any analysis in

support. Moreover, Trustee asserts the trial court erred in making a finding that is not reflected in

the Judgment. Trustee fails to explain how the law supports any claim of reversible error. Id.

         Rule 84.04 sets forth various requirements for appellate briefs and compliance with
         these requirements is mandatory in order to ensure that appellate courts do not
         become advocates by speculating on facts and on arguments that have not been
         made. Pursuant to these requirements, an argument must explain why, in the
         context of the case, the law supports the claim of reversible error. It should advise
         the appellate court how principles of law and the facts of the case interact. Further,
         if a party fails to support a contention with argument beyond mere conclusions, the
         point is considered abandoned.

Office of Admin. v. Pharmacy Corp. of Am., 586 S.W.3d 318, 325 (Mo. App. W.D. 2019) (citations

and internal quotation marks omitted).

         Point I is denied.9



         9
          To the extent that Trustee make additional arguments for the first time in its reply brief, we are precluded
from addressing them because the County has no opportunity to respond. Berry v. State, 908 S.W.2d 682, 684 (Mo.
banc 1995). We note the County sought leave to file a sur-reply, which was denied. In its motion, the County
argued that the Trustee argued for the first time in its reply brief that the Zona Rosa Bonds fall under a special
category of “Non-Bond Legal Obligations” under which the County undertook obligations to pay shortfalls for the
Zona Rosa Bonds that are different from general obligations, revenue bond obligations, or moral obligations.
“[P]oints and arguments omitted from an appellant's initial brief may not be supplied by a reply brief.” Coyne v.

                                                         13
Point II

         In Point II, the Trustee contends that the trial court erred in granting summary judgment in

favor of the County because the trial court violated multiple rules of contract interpretation by

holding that the Financing Agreement imposed only a moral obligation when the County made a

conditional promise to pay. We disagree.

         First, Trustee argues that the language of the first sentence of section 2.2 supports its

argument that the County made a conditional promise to pay, which states that “[t]he County

intends on or before the last day of each Fiscal Year, to budget and appropriate, specifically with

respect to this Agreement, moneys sufficient to pay the Appropriation Amount.” Trustee argues

that the plain meaning of the word “intends” is “to have in mind as a goal” and concludes that the

County’s goal was to appropriate money sufficient to pay the principal and the interest due on the

Zona Rosa Bonds for the fiscal year. Trustee claims that this “goal” is conditioned on, without

any reference to, Article VI, section 26(a) of the Missouri Constitution, which requires that the

County’s expenditures do not exceed income and revenues for the year plus prior year’s

unencumbered property.10 We disagree with Trustee’s interpretation as it is contrary to the plain

language of the Financing Agreement. We do not find that this sentence contains a conditional

promise. The plain and ordinary meaning of this sentence means that the County intends to budget

and appropriate moneys sufficient to pay the Appropriation Amount for the next Fiscal year. It is

undisputed that is exactly what the County did. In fact, in response to the County’s statement of



Coyne, 17 S.W.3d 904, 906 (Mo. App. E.D. 2000). Nonetheless, Trustee’s argument in the reply brief still fails as it
remains premised on its assertion that the Financing Agreement contains a promise to pay by the County.
          10
             Article VI, section 26(a) provides: “No county, city, incorporated town or village, school district or other
political corporation or subdivision of the state shall become indebted in an amount exceeding in any year the
income and revenue provided for such year plus any unencumbered balances from previous years, except as
otherwise provided in this constitution.” (Emphasis added). Trustee’s argument refers to “unencumbered property”
but Article VI, section 26(a) references “unencumbered balances.” Trustee’s mischaracterization has no effect on
our analysis.

                                                           14
uncontroverted facts, Trustee conceded that from 2008 to 2018 the Auditor proposed and the

County budgeted and appropriated the Appropriation Amount every year. Trustee fails to

demonstrate how the plain language of section 2.2 contains a promise to pay the Appropriation

Amount. Contrary to Trustee’s argument, the very next sentence provides how and when the

County shall notify Trustee “whether or not the County Commission has appropriated funds[.]”

(Emphasis added.) The plain and ordinary meaning of this language indicates that although the

County may be committing to budget and appropriate funds in the amount of the Appropriation

Amount, the Commission must then decide to appropriate the funds or not.

       Second, Trustee argues that an interpretation that the County may appropriate or not

appropriate is inconsistent with the parties’ intention as it renders the intention language

meaningless and allows the County to escape performance of anything detrimental to itself. We

disagree. The intention language is not meaningless, it provides that every year the County will

budget and appropriate for the Appropriation Amount but that the proposed appropriation must be

approved by the County Commission by its Warrant. The plain language of the Financing

Agreement repeatedly provides that approval of the appropriation is at the discretion of the County

Commission. Trustee cites Magruder Quarry & Co., LLC v. Briscoe, 83 S.W.3d 647 (Mo. App.

E.D. 2002) for the statement that, “Frequently a court will find an apparently illusory promise to

be accompanied by an implied promise to use ‘best efforts’ or ‘reasonable efforts” but that

statement is not applicable here. County did not promise to use best or reasonable efforts to pay,

County did not promise to pay at all. It is undisputed that the Zona Rosa Bonds are revenue bonds

to be paid from the 1% sales tax collected by Districts I and II. A Letter of Credit was also in place

as was a Reserve Fund. Under the express and plain terms of the Financing Agreement, the County

was never obligated to pay the shortfall on the Zona Rosa Bonds. The County obligated itself to



                                                 15
consider whether to pay on the Zona Rosa Bonds by proposing a payment in the budget for the

County Commission’s approval. However, unless and until the County Commission made final,

specific approval of the appropriation by its Warrant, a step which had to occur at some point after

approval of the County budget, no payment would ever be made to Trustee. This final approval

by Warrant never occurred. Similarly, in Moschenross v. St. Louis County, 188 S.W.3d 13, 20-21

(Mo. App. E.D. 2006), the financing agreement did not result in debt incurred by the county

because the agreement “was merely to request annual appropriations for repayment of the bonds,

subject to the approval of the county council.”

       Moreover, although the trial court did not use the term “moral obligation” in its Judgment,

such a characterization is consistent with the County’s role here, and as described below provides

an incentive to the County to voluntarily make payment on bonds even when not required to do

so.

       A moral obligation is a form of credit enhancement typically provided by a
       government to another entity. Generally, a highly credit-worthy government
       pledges its ‘moral obligation’ to enhance a specific borrowing by a government of
       lesser credit quality. The debt is usually issued by a separate government entity,
       and the morally obligated government typically pledges to consider appropriating
       funds to replenish a debt service reserve that has been drawn upon. Creditor
       recourse in the event of non-payment is very limited for moral obligations, which,
       as the name suggests, are based more on good faith and a belief in market discipline
       than on legally enforceable covenants. . . . The moral obligation pledge is neither a
       guarantee to pay debt service or replenish a debt service reserve, nor is it a legal
       obligation to seek appropriation to pay for debt service or refill a reserve. Rather,
       it is the declaration that the pledging entity intends to support the debt with
       appropriations and will consider providing funding under certain circumstances. . .
       . While a moral obligation is weaker than a legal obligation to pay debt service, the
       entity providing the moral obligation pledge is signaling its support for the
       transaction to investors. Therefore, as with lease-backed obligations and non-lease
       annual appropriation obligations, the failure of a government to honor its moral
       obligation commitment is generally an indicator of severe stress that would likely
       result in negative rating action on the government’s [general obligation] rating.
       Similarly, in weighing the decision whether or not to honor a moral obligation,
       governments typically consider the market impact of the decision. The potential



                                                  16
         impact is usually sufficient to motivate the government to make the moral
         obligation appropriation, absent severe stress.

Rachel Cortez et al., Rating Methodology: Lease, Appropriation, Moral Obligation and

Comparable Debt of US State and Local Governments, Moody’s Investors Service, (July 9, 2018)

at 7-8. Any such moral obligation, however, does not bear on the plain and ordinary meaning of

the Financing Agreement.11

         Third, Trustee argues that had the County intended to maintain absolute discretion over its

appropriation obligations it could have expressly specified that a failure to make a payment would

not constitute an event of default. However, a default presupposes a contractual obligation. There

would be no reason to provide language regarding a default because the County was not

contractually obligated to pay on the Zona Rosa Bonds in the first place. Nonetheless, the language

included in section 2.4 plainly states that the County is not liable and is not pledging County

money.

         Finally, regarding section 2.4 of the Financing Agreement, Trustee argues that the trial

court failed to recognize the following language, “[t]he County’s obligations under this Agreement

shall be from year to year only, and shall not constitute a mandatory payment obligation of the

County in any ensuing Fiscal Year beyond the then current Fiscal Year.” Trustee claims that the

court would have to delete the words “mandatory payment obligation” to hold that the County has

no payment obligation in the current Fiscal Year. We disagree. It is clear from the plain language

of these provisions taken as a whole that no payment is mandatory until the County Commission

approves it. This language operates simply to preclude the County Commission from approving a

payment for a future fiscal year.


          We do not intend to impugn the soundness of County’s credit nor speculate on the effect of the County’s
         11

decision on its credit rating. However, an understanding of the County’s role in these highly-sophisticated financial
instruments is necessary to understand this situation.

                                                         17
       Point II is denied.

Point III

       In Point III, the Trustee argues that the trial court erred in entering summary judgment in

favor of the County because it relied on authorities that addressed unconditional promises, rather

than conditional promises, in that the County’s obligation to appropriate is conditioned on the

appropriation being permitted by the Missouri Constitution in a given year and the County’s

obligation to pay is also conditioned on the insufficiency or unavailability of other payment

sources for the bonds.

       In light of our analysis concluding that the plain language of the Financing Agreement does

not contain a conditional (or unconditional) promise to pay, this point fails.

       Point III is denied.

Point IV

       In Point IV, Trustee argues that the trial court erred in granting summary judgment in favor

of the County because the trial court failed to acknowledge that the Trustee can assert equitable

defenses as it was assigned the rights of the Development Authority, a public entity, under the

Financing Agreement. Trustee asserts the equitable defenses bar the County from “arguing that

the Financing Agreement means something other than a guaranty of a shortfall on an annual basis

when certain conditions precedent are satisfied under the doctrines of estoppel, laches, waiver, and

unclean hands” because the County admitted such an obligation and received millions of dollars

in benefits from Zona Rosa.

       Even assuming Trustee can assert equitable defenses as an assignee of a public entity, this

argument fails. Trustee argues that “the County’s representations in bond documents, the County

Attorney’s formal legal opinion of 2007, and the County’s representations and appropriations in



                                                 18
annual budgets from 2008 to 2018 are inconsistent with the claims asserted for the first time in

2018.” Trustee lists these documents but does not identify the language or representations in each

one on which it relies. Nonetheless, we have reviewed the documents cited and do not find support

for Trustee’s argument therein.

         In any event, this is a matter of contract interpretation. Where, as here, the contract is

unambiguous, “‘the intent of the parties is to be discerned from the contract alone’ based on the

plain and ordinary meaning of the language used.” Whelan Sec. Co, 379 S.W.3d at 846 (citation

omitted). Thus, in light of our analysis concluding the plain language of the Financing Agreement

does not contain a promise by the County to pay the shortfall on the Zona Rosa Bonds, this point

fails.

         Point IV is denied.

Point V

         In Point V, the Trustee argues that the trial court erred by not directing the County pay the

$765,390.95 that it was reserving for the 2018 shortfall because the conditions precedent for the

County to pay have been satisfied, in that the County had sufficient revenue and income in 2018

to pay the shortfall on the bonds and the other sources of payment were inadequate.

         This point fails in light of our analysis of the plain language of the Financing Agreement

and concluding that the trial court was correct in its finding that the County did not promise to pay

the shortfall on the Zona Rosa Bonds. Because there was no promise to pay, the trial court did not

err in not directing payment to the Trustee of the preserved funds. Moreover, there was no need

for the trial court to address the County’s obligations for 2018 and 2019 separately as in neither

case was the County required to pay for the shortfall. Trustee’s argument and authority cited deal




                                                  19
with contractual promises to pay which are not persuasive as we have already concluded the

Financing Agreement did not contain a contractual promise to pay by the County.

       Point V is denied.

Point VI

       In Point VI, the Trustee argues that the trial court erred by not addressing and not amending

its Judgment to address and apply the proper burden for summary judgment because Missouri law

provides that the party moving for summary judgment has the burden and the trial court did not

acknowledge this burden or the County’s failure to meet its burden.

       Trustee cites Rule 74.04 which provides for the procedure for motions for summary

judgment but does not indicate where in the Rule it requires that a Judgment ruling on a motion

for summary judgment must recite that the movant has the burden and whether or not movant met

that burden. We do not find such a requirement in Rule 74.04. Trustee does not cite any authority

that supports this argument. “When an appellant fails to cite relevant law and explain how it

applies to the applicable facts, we deem the point abandoned.” Brown v. Ameristar Casino Kansas

City, Inc., 211 S.W.3d 145, 148 (Mo. App. W.D. 2007).

       Point VI is denied.

                                           Conclusion

       The judgment of the trial court is affirmed.



                                             /s/ W. Douglas Thomson_____________________
                                             W. DOUGLAS THOMSON, JUDGE

All concur.




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