Current-law edition. Statutory text and cited propositions were reviewed against publicly available Missouri authorities through August 19, 2026. Because treatment signals from a proprietary citator were not available, counsel should run a final KeyCite/Shepard’s check before publication or reliance in litigation.

Mechanics’ Liens

R.S.Mo. § 429.010, et seq., governs the filing and perfection of a mechanic’s or materialmen’s lien. The purpose of the lien is to protect contractors, subcontractors, and materialmen whose labor and materials increase the value of a property.  It provides special priorities over other encumbrances against the property. Courts generally uphold, wherever possible, the rights of laborers and materialmen.

• Requirements
  • Every original contractor (aka general contractor) must provide to the person for whom the work or labor is provided a written notice, before payment is received, containing the following disclosure language in ten-point bold face type:

NOTICE TO OWNER

FAILURE OF THIS CONTRACTOR TO PAY THOSE PERSONS SUPPLYING MATERIAL OR SERVICES TO COMPLETE THIS CONTRACT CAN RESULT IN THE FILING OF A MECHANIC’S LIEN ON THE PROPERTY WHICH IS THE SUBJECT OF THIS CONTRACT PURSUANT TO CHAPTER 429, RSMO. TO AVOID THIS RESULT YOU MAY ASK THIS CONTRACTOR FOR “LIEN WAIVERS” FROM ALL PERSONS SUPPLYING MATERIAL OR SERVICES FOR THE WORK DESCRIBED IN THIS CONTRACT. FAILURE TO SECURE LIEN WAIVERS MAY RESULT IN YOUR PAYING FOR LABOR AND MATERIAL TWICE.[1216]

• • For the repair, remodeling of, or addition to owner-occupied residential property of four units or less (but not original residential construction), no person other than the original contractor may have a lien unless an owner agreed in a written contract to be liable for unpaid costs. The consent must be printed in ten-point bold type, signed separately from the § 429.012 notice, and use the statutory language below. A signed copy must be attached to a non-original contractor’s lien claim. R.S.Mo. § 429.013.2-.3.

CONSENT OF OWNER

CONSENT IS HEREBY GIVEN FOR FILING OF MECHANIC’S LIENS BY ANY PERSON WHO SUPPLIES MATERIALS OR SERVICES FOR THE WORK DESCRIBED IN THIS CONTRACT ON THE PROPERTY ON WHICH IT IS LOCATED IF HE IS NOT PAID.[1217]

• Enforcement and Foreclosure
  • All actions to enforce a mechanic’s lien must be commenced within six months after the lien is filed and prosecuted without unnecessary delay. R.S.Mo. § 429.170. Generally, a subcontractor should also name the original contractor as a party. The petition must (1) contain a description of the property to be charged with the lien and (2) allege facts necessary to secure the lien, including the identity of the parties, the existence and terms of the contract, the dates work was performed, and satisfaction of applicable notice requirements.
  • The following prescribes general comments regarding collecting:
    • If the principal debtor has been personally served – personal judgment and judgment lien;[1218]
    • If service is by publication and the debtor has not appeared – judgment can only be levied against the owner’s interest in the land;[1219] and
    • Interest is includable in any mechanic’s lien judgment.[1220]
• Ability to Waive and Limitations on Lien Rights
  • Within six months of the indebtedness, a claimant must file with the circuit clerk of the proper county the lien containing a “just and true account” of the amount owed.[1221] Courts construe this requirement to be a condition precedent to the right to establish a mechanic’s lien.[1222]

Public Project Claims

• State and Local Public Work
  • Missouri public contracting requirements appear in Chapter 34 and in statutes applicable to particular public entities and project types. Payment-bond requirements are governed principally by R.S.Mo. § 107.170. As amended effective August 28, 2025, § 107.170 generally requires a bond for public-works contracts estimated to exceed $50,000, subject to statutory exceptions. The section now defines “contractor,” “public entity,” “public official,” and “public works”; covers specified nongovernmental-purpose work undertaken through a public entity’s lessee, agent, designee, or representative; excludes listed professional and other services from “contractor”; requires a remote supplier to notify the contractor in writing of nonpayment within ninety days after it last supplied materials; and provides that a compliant bond precludes a subcontractor or supplier mechanic’s lien. R.S.Mo. § 107.170.1-.2, .6-.8 (effective Aug. 28, 2025). Local bidding requirements remain entity- and project-specific and should be checked against the governing statute, charter, ordinances, and procurement documents.
    • Missouri’s Public Prompt Pay Act includes professional engineers, architects, landscape architects, and land surveyors. Retainage on public-works construction contracts and subcontracts generally may not exceed five percent. If no § 107.170 bond is required because the contract is not estimated to exceed $50,000, the public owner may withhold up to ten percent. After retainage is released, the owner may withhold 150% of the value of remaining minor items. R.S.Mo. § 34.057.1(1), (3).
    • Missouri courts permit an unsuccessful bidder on a public works project to challenge the award of a contract to another if the bidding procedure did not permit all bidders to compete on equal terms.[1223]  
• Claims to Public Funds
  • The Missouri Public Prompt Pay Act requires payment, less retainage, within thirty (30) days from the date of the service or delivery of material, the date of the delivery of the contractor’s invoice, or the contractor’s approval of the public owner’s estimate of the completed work.  Interest is due on late payments at the rate of one and one-half percent per month following the expiration of the initial thirty (30) day payment period.  The contractor is required to pay its subcontractors within fifteen (15) days of receipt of the payment from the public owner, with the same interest penalties imposed upon the contractor for its late payments to subcontractors.  Disputes over payments are to be addressed in a civil action.  Interest penalties are not to be awarded by the court if the court determines a payment was withheld in good faith for reasonable cause.

Statutes of Limitations and Repose

• Statutes of Limitations and Limitations on Application of Statutes
  • Ten Years:
    1. Action to recover possession of land.[1224]
    2. Action for payment of money or property pursuant to written obligation (does not include U.C.C. actions).[1225]
    3. Statute of repose for actions—including claims for economic loss, personal injury, property damage, wrongful death, contribution, or indemnity—arising from a defective or unsafe improvement to real property against persons whose sole connection is design, planning, or construction services. R.S.Mo. § 516.097 (subject to its exceptions). or unsafe condition of an improvement to real property.[1226]
    4. Actions for relief not otherwise provided for in Chapter 516. R.S.Mo. § 516.110(3).
  • Five Years:
    1. Action for trespass on real estate.[1227]
    2. Contract actions not covered by R.S.Mo. § 516.110(1).[1228]
    3. Action for recovery of personal property or injury to a person not arising on contract.[1229]
    4. Actions upon a liability created by statute other than a penalty or forfeiture.[1230]
    5. Actions for fraud, which accrue upon discovery of the facts constituting the fraud, but no later than ten years after the act constituting the fraud. R.S.Mo. § 516.120(5).
  • Accrual
    • Under Missouri’s generally applicable accrual rule, a cause of action does not accrue when the wrong or technical breach occurs, but when resulting damage is sustained and capable of ascertainment; if there is more than one item of damage, accrual occurs when the last item is sustained so that full relief may be obtained. R.S.Mo. § 516.100. This is not a free-standing discovery rule, although the facts and the nature of the professional claim affect when damage was objectively capable of ascertainment. See Deutsch v. Wolff, 994 S.W.2d 561, 569-72 (Mo. banc 1999).
  • Inability to Contractually Alter
    • Parties to a contract cannot directly or indirectly limit the time within which a cause of action can be brought and Missouri statutes provide that any such contractual provisions are null and void.[1231]
  • Fraudulent Concealment
    • If a person improperly prevents the commencement of an action by absconding, hiding or any other improper act, the statute of limitations begins to run at the time that party is no longer absconding, hiding or preventing the action by the improper act.[1232]
• Statutes of Repose and Limitations on Application of Statutes
  • Generally
    • As set forth in Section III.A.1 above, tort actions against builders, architects, and engineers for a defective improvement to real property must be brought within ten (10) years of the improvement’s completion or the issuance of an occupancy permit.[1233]  The purpose of the statute is to protect those who provide construction services from “indeterminate liability.”[1234]  A party recently joined in an action by such builder, architect or engineer under the statute has one year to file a third party action (notwithstanding the ten year deadline) arising out of the allegations.[1235]
  • Analyzing the Application
    • The first issue to determine under the statute is whether the construction services constituted an “improvement” to the property. Missouri law has defined the term “improvement” as “[a] permanent addition to or betterment of real property that enhances its capital value and that involves the expenditure of labor or money and is designed to make the property more useful or valuable as distinguished from ordinary repairs.”[1236]
    • The second issue to determine is whether the alleged property damage occurred within ten years after the builder completed the improvement.[1237]
    • The final issue is whether the claimed defect that allegedly caused the damage was “concealed.” Missouri cases have interpreted “concealed” to mean “an affirmative act, something actually done directly intended to prevent discovery or to thwart investigation.”[1238]  A concealed defective condition is “one that is not discoverable by reasonable diligence.”[1239]
  • Application to Manufacturers
    • A manufacturer that fabricates or assembles building materials or component parts incorporated within the real property in the construction of an improvement is “performing or furnishing. . . construction services” under R.S.Mo. § 516.097.2.[1240]  The application of the statute of repose does not protect a manufacturer whose standard product is fabricated at the manufacturer’s factory, made available to the general public, and then “furnished for the inclusion in the improvement by the persons constructing the improvement under circumstances where the manufacturer has no substantial on-site construction activity.”[1241]  To invoke the affirmative defense of the statute of repose, a manufacturer must have “substantial participation at the construction site in significant activities in installing or incorporating the product into the real property.”[1242]

Pre-suit Notice of Claim and Opportunity to Cure

• Express Warranties
  • Typically, express warranties that accompany a product from the manufacturer will incorporate a time limit by which notice must be given to the manufacturer in order to honor the warranty.
• Residential Construction Defects
  • Missouri law requires a contractor to notify a homebuyer that the homebuyer must give the contractor the opportunity to cure construction defects before the homebuyer can began an action  in court.[1243]  The contractor must give the homebuyer notice of this opportunity to cure “in substantially the following form:

SECTIONS 436.350 TO 436.365 OF MISSOURI REVISED STATUTES PROVIDE YOU WITH CERTAIN RIGHTS IF YOU HAVE A DISPUTE WITH A CONTRACTOR REGARDING CONSTRUCTION DEFECTS. EXCEPT FOR CLAIMS FILED IN SMALL CLAIMS COURT, IF YOU HAVE A DISPUTE WITH A CONTRACTOR, YOU MUST DELIVER TO THE CONTRACTOR A WRITTEN CLAIM OF ANY CONSTRUCTION CONDITIONS YOU ALLEGE ARE DEFECTIVE AND PROVIDE YOUR CONTRACTOR THE OPPORTUNITY TO MAKE AN OFFER TO REPAIR OR PAY FOR THE DEFECTS. YOU ARE NOT OBLIGATED TO ACCEPT ANY OFFER MADE BY THE CONTRACTOR. READ THIS NOTICE CAREFULLY. THERE ARE STRICT DEADLINES AND PROCEDURES UNDER SECTIONS 436.350 TO 436.365 WHICH MUST BE OBEYED IN ORDER TO PRESERVE YOUR ABILITY TO FILE A LAWSUIT. OTHER THAN REPAIRS TO WORK DONE BY THE CONTRACTOR THAT ARE NECESSARY TO PROTECT THE LIFE, HEALTH, OR SAFETY OF PERSONS LIVING IN A RESIDENCE, OR TO AVOID ADDITIONAL SIGNIFICANT AND MATERIAL DAMAGE TO THE RESIDENCE PURSUANT TO SUBSECTION 10 OF SECTION 436.356, YOU MAY NOT INCLUDE IN CLAIMS AGAINST YOUR CONTRACTOR THE COSTS OF OTHER REPAIRS YOU PERFORM BEFORE YOU ARE ENTITLED TO FILE A LAWSUIT UNDER SECTIONS 436.350 TO 436.365.[1244]

• • The claimant/homeowner’s written notice or claim “shall state that the claimant asserts a construction defect claim against the contractor and shall describe the claim in reasonable detail sufficient to determine the general nature of the defect as well as any known results of the defect.”[1245]  The contractor then has fourteen days (from service of the notice) to respond in writing, which shall:
    1. Propose to inspect the residence that is the subject of the claim and to complete the inspection within a specified time frame. The proposal shall include the statement that the contractor shall, based on the inspection, thereafter offer to remedy the defect within a specified time frame, compromise by payment, or dispute the claim; or
    2. Offer to remedy the claim without an inspection within a specified time frame; or
    3. Offer to remedy part of the claim without inspection and compromise and settle the remainder of the claim by monetary payment within a specified time frame; or
    4. Offer to compromise and settle all of a claim without inspection. A contractor’s offer pursuant to this subdivision to compromise and settle a claimant’s or association’s claim may include, but is not limited to, an express offer to purchase the claimant’s residence that is the subject of the claim; or
    5. State that the contractor disputes the claim and will neither remedy the construction defect nor compromise and settle the claim.[1246]
  • The statute then sets out further procedures to be taken by the claimant and contractor depending upon which option to remedy the defect is offered.[1247]  Nothing in the statute interferes with the contractual rights to arbitrate[1248] or mediate[1249] the claim.  The statute is inapplicable if the homeowner’s action against the contractor is in a counterclaim or if the homeowner asserts an affirmative defense that includes a claim based on a construction defect allegedly caused by the contractor.[1250]

Predicates for Claims Against Design Professionals

Missouri does not impose in this compendium’s subject area a distinct pre-suit notice-and-cure procedure comparable to §§ 436.350-.365 solely because the defendant is an architect or engineer. A claimant must plead and prove the elements of the chosen cause of action, and technical standard-of-care or causation issues ordinarily require competent expert proof. Expert testimony is governed by R.S.Mo. § 490.065. Contractual notice, mediation, arbitration, limitation-of-liability, and claim-accrual provisions must be evaluated separately, together with the ten-year statute of repose in § 516.097.

Insurance Coverage and Allocation Issues

• General Coverage Issues
  • The burden of showing that a loss and damages are covered under an insurance policy is placed upon the insured, while the burden of showing that there is an applicable exclusion is on the insurer.[1251]  Under this principle, the insurer will be required to demonstrate to a Missouri court that there are applicable exclusions to the insurance agreement that negate coverage. An insurer need not show that each exclusion is applicable to preclude coverage, but that any one exclusion is sufficient.[1252]
  • Punitive damages are not covered unless the policy specifically provides coverage.[1253]
  • More than one person or organization may be an insured in respect to the same occurrence. Such policies customarily contain a clause that, in effect, makes the policy apply separately to each of the persons insured.
• Trigger of Coverage
  • Language of an insurance contract must be given its plain meaning, “without unduly straining the language.” [1254] A standard Commercial General Liability (“CGL”) policy will contain a clause limiting liability to ‘bodily injury’ and property damage’ only if the ‘bodily injury’ or ‘property damage’ occurs during the policy period.
  • Coverage generally does not exist under a CGL policy for contract claims and breach of warranty.
  • Several Missouri courts have defined an “occurrence” under a CGL policy as an “accident.”  A claim for defective workmanship is considered an “occurrence” within the meaning of the CGL policy if the defect was unforeseen or unexpected and includes “injury caused by the negligence of the insured.”[1255]  If the damage was foreseeable or expected, coverage does not exist because the CGL policy is not intended to function as a performance bond or warranty for the goods or services provided.[1256] The rationale is that a CGL policy is not intended to protect business owners against every risk of operating a business, nor is it intended as a guarantee of the quality of an insured’s product or work.[1257]  However, if the CGL policy defines an occurrence to mean an accident, Missouri courts consider this to include “injury caused by the negligence of the insured.”
• Allocation Among Insurers
  • When two or more liability insurers are liable for the same loss, that liability is to be apportioned according to the terms of the policies involved.[1258]  However, in the absence of terms controlling apportionment or when such terms are repugnant, generally the loss will be apportioned according to the coverage afforded by each policy involved.[1259]  When several limits of coverage are stacked, the insurers are required to contribute pro rata to a loss that is below the combined limits of the several policies.[1260]
• Issues with Additional Insurance
  • One method of risk shifting is to require persons with whom you are contracting to obtain insurance and provide a certificate naming you as an additional insured.  The additional insured endorsement may require the insurance company to defend you if you are sued as a result of the contractor’s work.  However, whether an insurance company will be required to provide such a defense depends upon the terms of the additional insured endorsement.  The certificate itself will likely contain the following limitation:

THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER.  THIS CERTIFICATE DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW.

• • Beware that insurance companies may not be aware of certificates issued by brokers and may attempt to deny that any insurance is afforded as a result of an unauthorized certificate of insurance.  You should always request a copy of the policy pursuant to which the additional insured endorsement is issued.  This will allow you to review the policy to determine whether the policy contains a blanket insured endorsement.
  • Frequently encountered additional-insured endorsements include ISO forms CG 20 10 and CG 20 33, but the form number alone is not enough: the edition date, schedule, completed-operations endorsement, and policy modifications control. A certificate of insurance ordinarily does not itself amend the policy or create coverage.
  • Form CG 20 33, captioned “Additional Insured – Owners, Lessees or Contractors – Automatic Status When Required in Construction Agreement”  modifies the coverage of an insurance policy to include as an additional insured any person or organization for whom a contractor is:

“performing operations when … [a contractor] and such person or organization have agreed in writing in a contract or agreement that such person or organization be added as an additional insured on … [the contractor’s] policy.”

• • Many editions of CG 20 33 address automatic additional-insured status for ongoing operations when required by a written construction agreement. Coverage scope, professional-services exclusions, and completed-operations protection depend on the exact edition and the full policy. Do not state categorically that all CG 20 33 forms eliminate completed-operations coverage without reviewing the issued endorsement and any companion endorsement.
  • CG 20 10 is a scheduled additional-insured endorsement whose grant and limitations vary by edition. Some editions use “arising out of” wording; later editions use “caused, in whole or in part, by” acts or omissions wording and may limit coverage to the extent permitted by law or contract. Completed-operations coverage is commonly addressed by a separate endorsement (for example, CG 20 37). The issued forms, schedules, and edition dates must be reviewed together.
  • Insurance coverage presents complex issues that should be reviewed by an attorney and insurance broker to determine the nature and scope of coverage provided.

Contractual Indemnification

In 1999, Missouri enacted its first anti-indemnity statute that generally prohibits indemnity agreements in private and public construction contracts.  It states in part that “in any contract or agreement for public or private construction work, a party’s covenant, promise or agreement to indemnify or hold harmless another person from that person’s own negligence or wrongdoing is void as against public policy and wholly unenforceable.”[1261]

The statute sets forth several exceptions to the prohibition on indemnity agreements, including an exception for “an agreement containing a party’s promise to indemnify, defend or hold harmless another person, if the agreement also requires the party to obtain specified limits of insurance to insure the indemnity obligation and the party had the opportunity to recovery the cost of the required insurance in its contract price; provided, however, that in such case the party’s liability under the indemnity obligation shall be limited to the coverage and limits of the required insurance.”  This exception affords parties to construction contracts to obtain a Commercial General Liability Policy to avoid the prohibition on indemnity agreements in public and private construction statutes.

When an action for contractual indemnity is permitted, it is governed by the terms of the contract and is separate from the action against the indemnitee that gives rise to the claim for indemnification. The necessity of a demand for indemnification as a condition precedent to performance by the indemnitor will be governed by the terms of the contract.  Indemnity claims are often pled as cross-claims or third-party claims.[1262]  In general, indemnity agreements are valid and enforceable, but must be very clear.[1263]

The elements of a contractual indemnity claim are fundamentally the same as any other claim for breach of contract:

1. an agreement between parties capable of contracting;
2. supported by consideration;
3. providing that one party (indemnitor) secures or protects the other (indemnitee) against liability or loss, or a combination of the two; and
4. a breach of the obligation of indemnity; and
5. damages incurred by the indemnitee.[1264]

A petition seeking recovery on a contractual indemnity theory should contain:

1. a description of the parties;
2. allegations of jurisdiction and venue (if the indemnity claim is a cross-claim or third-party claim, jurisdiction and venue may be established by alleging the circumstances of the pending action);
3. allegations showing the existence of a contract of indemnity or other contract giving rise to a claim for indemnity, including allegations of capacity of the parties, the substance of the contract, and consideration;[1265]
4. allegations showing the breach of contract by the indemnitor;[1266]
5. allegations showing breach by the defendant by failing to reimburse plaintiff’s actual loss (loss indemnity) or by failing to discharge plaintiff’s liability as finally fixed and determined, either by a good-faith settlement or by adjudication (liability indemnity or mixed loss/liability);
6. allegations of demand or tender of defense, if necessary;[1267] and
7. allegations of damage, including sums sought for costs and expenses of the defense of the underlying claim and enforcing the indemnity agreement, if appropriate.

A contract for indemnity, like other contracts, must be sufficiently definite and certain to permit the court to enforce it. If the essential terms of the contract of indemnity are not sufficiently definite for a court to give them an exact meaning, such as where the contract does not clearly specify who is the indemnitor, enforcement will be denied.[1268]

Contingent Payment Agreements

• Pay-if-paid clauses:
  1. Missouri courts enforce clearly drafted payment-as-condition-precedent provisions; ambiguous language is construed as setting a reasonable time for payment rather than shifting the owner’s insolvency risk. See Meco Systems, Inc. v. Dancing Bear Entertainment, Inc., 42 S.W.3d 794, 806-08 (Mo. App. S.D. 2001); A. Zahner Co. v. McGowan Builders, Inc., 497 S.W.3d 779, 784-86 (Mo. App. W.D. 2016).
  2. Missouri appellate decisions have construed contingent-payment clauses, but the result remains text-specific. Clear condition-precedent language is essential; incorporated prime-contract terms must be reviewed with the subcontract.
  3. When a pay-if-paid provision is included in a contract, Missouri courts will only construe payment to be a condition precedent if the contract terms are plain and unambiguous. When a general contractor puts a risk-shifting provision in a subcontract, the burden of clear expression will be on the general contractor.[1269]
  4. Courts consider all incorporated and referenced documents in the subcontract in construing pay-if-paid clauses.[1270]
  5. If the clause is ambiguous, it will be interpreted as fixing a reasonable time for payment to the subcontractor.[1271]
• Pay-when-paid clauses:
  1. Generally, pay-when-paid clauses address the timing of payment, rather than the right to payment, and are enforceable.
  2. If the language is ambiguous, the pay-when-paid clause will be construed as establishing a reasonable period for payment to subcontractor.[1272]

Scope of Damage Recovery

• Personal Injury Damages vs. Construction Defect Damages
  • The ultimate test for damages is whether the award will fairly and reasonably compensate the plaintiff for his or her injuries.[1273]
    • Personal Injury Damages
      • The following are basic areas of recovery in personal injury law:
        1. Actual or Compensatory Damages – including pain and suffering;
        2. Special Damages – such as hospitalization, medical expenses or loss of wages (both past and future);[1274]
        3. Future Medical Expenses;
        4. Economic Loss;[1275]
        5. Punitive Damages;[1276] and
        6. Loss of Consortium – of spouse.
    • Construction Defect Damages
      • Generally on a construction defect case under a theory of breach of contract, “plaintiffs are entitled to recover as damages only a sum which is the equivalent of performance of the bargain—to be placed in the position they would be in if the contract had been fulfilled in a workmanlike manner.”[1277]  These may incorporate actual damages, consequential damages, and lost profits.[1278]  The plaintiff bears the burden of proving that damages exist, and the amount of those damages.[1279] The plaintiff “must demonstrate the level of damages with reasonable certainty.”[1280]  “Such proof must rise to the level of substantial evidence, which has been defined as that which a reasonable mind would accept as sufficient to support a particular conclusion, granting all reasonable inference[s] which can be drawn from it.”[1281]
      • The Missouri Court of Appeals set forth the following standard with respect to the amount of damages recoverable for defective performance:

When a building contractor breaches his contract by defective performance, . . . two methods are commonly used to measure the resulting damages.  One method, called ‘cost of repair’ is, as its name implies, the cost of repairing the defective work. 5 Corbin, Contracts, § 1089 (1964); Restatement of Contracts, § 346(1)(a) (1932). The second method, called ‘diminution in value,’ is the difference between the value of the building as promised and its value as actually constructed. See Kahn v. Prahl, 414 S.W.2d 269, 282–283 (Mo.1967); Hotchner v. Liebowits, 341 S.W.2d 319, 332 (Mo.App.1960). The particular facts of each case determine which measure of damages is to be used.[1282]

• • • • The basic rule is that a plaintiff is entitled to recover the lesser of the cost of repair or the diminution of value of the property with the defective condition.[1283]
• Attorneys’ Fees Shifting and Limitations on Recovery
  • Unlike court costs, attorneys’ fees are not generally recoverable from the other party.[1284] Attorney fees are ordinarily only recoverable when 1) called for by contract 2) expressly provided for by statute, 3) as an item of collateral damage, or 4) where equity requires (“very unusual circumstances”).[1285]
• Consequential Damages
  • Consequential damages are “those damages naturally and proximately caused by the commission of the breach and those damages that reasonably could have been contemplated by the defendant at the time of the parties’ agreement.”[1286]  Missouri Courts permit the recovery of consequential damages.
• Delay and Disruption Damages
  • Delay Damages
    • Whether delay in completion of a construction contract is excusable, thus mitigating a potential claim for damages against the contractor, has been explained as follows:

Excusable delay occurs as a result of events outside a contractor’s control, such as acts of God (floods, hurricanes), labor strikes, unusually severe weather, and an inability to obtain critical materials due to plant closings and product shortages. Inexcusable delay is caused by the contractor, due to a failure to properly schedule or supervise the work or to prosecute the work diligently. Generally, an excusable delay entitles a contractor to a contract time extension and relief from a potential or actual liquidated damages assessment but does not allow the contractor to recover the costs of delay.[1287]

• • • A contractual provision that instructs a contractor on a procedure and time limit within which that contractor must request an extension due to delay is enforceable, and failure to abide by such a provision renders delays inexcusable.[1288]  In addition, many contracts will require notice before delay is “excused.”[1289]  The Missouri Supreme Court addressed these issues in Bloomfield Reorganized School Dist. v. Stites and strictly enforced the notice provisions regarding extensions due to delay.  In Bloomfield, a school and a contractor agreed to the construction of a building on the school’s campus.[1290]  After differences arose, the school sued the contractor to terminate the contract.[1291]  The Bloomfield contract contained a provision granting extensions of time “for delays beyond the control of the Contractor.”[1292]  A later provision, however, provided that “[n]o such extension shall be made for delay occurring more than seven days before claim therefore [sic] is made in writing to the Architect.”[1293]  The contractor applied for an extension nineteen days after the agreed completion date, requesting extensions of time ranging from 45 days to 120 days.  The contractor testified that there were delays due to a cement and steel shortage and to the weather, over which neither party had any control.  In addition, the contractor claimed that there were numerous delays attributable to the misconduct of the architect, such as “denial of permission to fabricate his own steel, delay in approving various shop drawings, delay in furnishing a paint schedule, delay in supplying information as to light fixtures, refusal to answer inquiries as to two stairways and, in short, just about every item in the plans and specifications.”[1294]
    • The Missouri Supreme Court ruled the school was entitled to liquidated damages for inexcusable delay.[1295]  In so ruling, the Bloomfield Court noted: “All of these listed delays had occurred in the past, not ‘seven days before claim therefore [sic] is made,’” and, “[w]hile the contractual provision [the article discussing delay] may have been intended for the contractor’s benefit, he did not comply with it and he is therefore not to be excused for the delays.”[1296]
    • There are, however, exceptions to the general rule that when a construction contract requires a written change order, there is no right to recover for extra work without such a writing or waiver by the owner. For example, if the parties orally agreed upon the extra work or supplies and if such “extras” were supplied pursuant to this agreement, that may constitute a waiver of the written change order requirement.[1297]  In addition, habitual acceptance of extra work done on oral change orders in connection with a contract and payment may constitute a waiver of any contract clause providing that no claims for extra work or material will be allowed unless it is performed pursuant to a written change order.[1298]
  • Disruption Damages
    • Disruption damages may occur when a change in the project schedule results in additional labor, time or expenses on the project by the contractor/subcontractor.  They are contractual in nature.[1299]
• Economic Loss Doctrine
  • Missouri’s economic-loss doctrine generally bars tort recovery for purely economic loss where contract or warranty law supplies the governing allocation of risk, particularly for commercial transactions and disappointed product expectations. It does not create a universal rule that every contracting party owes no tort duty to every nonparty. Application depends on the claim, the relationship, the source of the asserted duty, the nature of the loss, and recognized exceptions, including some claims involving professional services, negligent misrepresentation, fiduciary duties, personal injury, or damage to other property. See Captiva Lake Investments, LLC v. Ameristructure, Inc., 436 S.W.3d 619, 628 (Mo. App. E.D. 2014); Autry Morlan Chevrolet Cadillac, Inc. v. RJF Agencies, Inc., 332 S.W.3d 184, 192-94 (Mo. App. S.D. 2010).
  • Damages for economic loss may be recovered in certain negligence actions in Missouri. Economic loss includes “cost of repair and replacement of defective property which is the subject of the transaction, as well as commercial loss for inadequate value and consequent loss of profits or use.”[1300]  Such damages may be recovered in actions for personal injury, damage to property other than the property at issue, destruction of the property sold due to some violent occurrence, and in actions involving negligent rendition of services by a professional.[1301]  In 2011, the Missouri Supreme Court held comparative fault applies to property damages and economic loss damages.[1302]
• Interest
  • Prejudgment Interest
    • Contract Actions
      1. Missouri courts permit the recovery of prejudgment interest.[1303]
      2. Absent an agreement between the parties, prejudgment interest is allowed at the rate of 9% annually.[1304]
      3. In the case of written contracts, prejudgment interest begins to accrue when the amount owing becomes “due and payable.”[1305]
      4. In contractual obligations other than written agreements, prejudgment interest does not begin to accrue until the amount becomes due and a demand for payment is made.[1306]
      5. For actions based upon Missouri’s Prompt Pay Act, which concern private construction projects, interest accrues at the rate up to one and one-half percent from the date payment was due pursuant to the contract.[1307]
  • Tort Actions
    • Prejudgment interest is difficult to recover in tort actions, due to the stringent requirements of R.S.Mo. § 408.040.[1308]
    • Prejudgment interest can be recovered following a demand for payment or a settlement demand, but must be made in compliance with R.S.Mo. § 408.040 as follows:

“[I]f a claimant has made a demand for payment of a claim or an offer of settlement of a claim, to the party, parties or their representatives, and to such party’s liability insurer if known to the claimant, and the amount of the judgment or order exceeds the demand for payment or offer of settlement, then prejudgment interest shall be awarded, calculated from a date ninety days after the demand or offer was received, as shown by the certified mail return receipt, or from the date the demand or offer was rejected without counter offer, whichever is earlier. In order to qualify as a demand or offer pursuant to this section, such demand must:

1. 1. 1. 1. 1. 1. Be in writing and sent by certified mail return receipt requested; and

               2. Be accompanied by an affidavit of the claimant describing the nature of the claim, the nature of any injuries claimed and a general computation of any category of damages sought by the claimant with supporting documentation, if any is reasonably available; and

               3. For wrongful death, personal injury, and bodily injury claims, be accompanied by a list of the names and addresses of medical providers who have provided treatment to the claimant or decedent for such injuries, copies of all reasonably available medical bills, a list of employers if the claimant is seeking damages for loss of wages or earning, and written authorizations sufficient to allow the party, its representatives, and liability insurer if known to the claimant to obtain records from all employers and medical care providers; and

               4. Reference this section and be left open for ninety days.

               5. Unless the parties agree in writing to a longer period of time, if the claimant fails to file a cause of action in circuit court prior to a date one hundred twenty days after the demand or offer was received, then the court shall not award prejudgment interest to the claimant. If the claimant is a minor or incompetent or deceased, the affidavit may be signed by any person who reasonably appears to be qualified to act as next friend or conservator or personal representative. If the claim is one for wrongful death, the affidavit may be signed by any person qualified pursuant to section 537.080, RSMo, to make claim for the death. Nothing contained herein shall limit the right of a claimant, in actions other than tort actions, to recover prejudgment interest as otherwise provided by law or contract.[1309]

• • • Prejudgment interest in tort actions bears interest at a per annum interest rate equal to the intended Federal Funds Rate, as established by the Federal Reserve Board, plus three percent.[1310] The judgment must set forth the applicable interest rate, which cannot be varied once entered.[1311]
  • Post-judgment Interest
    • Contract Actions
      1. Judgments in Missouri for actions in contract accrue interest at the rate of 9% annually, if there is no agreement for a higher rate of interest. However, where the judgment is founded upon a contract providing for a higher rate of interest, the higher rate applies.[1312]
      2. Interest begins to accrue from the day the judgment is rendered regardless of whether the judgment itself mentions a right to the interest.[1313]
      3. Normally, the pendency of an appeal does not affect accrual of interest.[1314]
    • Tort Actions
      1. Judgments in Missouri for actions in tort accrue interest from the date judgment is entered by the trial court at a per annum interest rate equal to the intended Federal Funds Rate, as established by the Federal Reserve Board, plus five percent, until full satisfaction is made.[1315]
      2. The judgment must state the applicable interest rate, which cannot vary once entered.[1316]
• Punitive Damages
  • For civil actions filed on or after August 28, 2020, R.S.Mo. § 510.261 supplies the principal punitive-damages standard. Except as otherwise provided by statute, the claimant must prove by clear and convincing evidence that the defendant intentionally harmed the plaintiff without just cause or acted with deliberate and flagrant disregard for the safety of others. Punitive damages generally require more than nominal damages, subject to statutory exceptions. R.S.Mo. § 510.261.1-.2, § 510.262.
  • Negligence cases:
    1. The governing statutory standard is intentional harm without just cause or deliberate and flagrant disregard for the safety of others, proved by clear and convincing evidence. R.S.Mo. § 510.261.1. Older formulations such as “complete indifference” or “conscious disregard” should not be presented as the exclusive current standard for actions governed by the 2020 enactment.
    2. Punitive damages against an employer or principal for an agent’s act are limited to the circumstances listed in § 510.261.3, including authorization, reckless employment or retention of an unfit agent, specified managerial conduct, or ratification or approval.
    3. Punitive damages are intended to punish and deter defendant and others from like conduct.[1317]
  • Intentional tort cases:
    • For intentional tort claims governed by § 510.261, apply the statutory clear-and-convincing standard: intentional harm without just cause or deliberate and flagrant disregard for the safety of others. Claim-specific common-law formulations may remain relevant only to the extent consistent with § 510.261. See R.S.Mo. § 510.261.1, .8.
  • Discovery
    • An initial pleading may not contain a punitive-damages claim. A later pleading requires leave of court on a timely written motion supported by affidavits, exhibits, or discovery materials establishing a reasonable basis for recovery, under the procedure in R.S.Mo. § 510.261.5. Discovery of a defendant’s financial condition is governed by R.S.Mo. § 510.263.8 and requires the statutory threshold finding.
  • Section 510.265 states a cap equal to the greater of $500,000 or five times the net judgment, subject to statutory exceptions. Its application must also be evaluated under Lewellen v. Franklin, 441 S.W.3d 136, 143-46 (Mo. banc 2014), which held the cap unconstitutional as applied to a common-law fraud claim protected by the Missouri constitutional jury-trial right. Do not state the cap as universally controlling.
    • $500,000; or
    • Five times the amount of the judgment.[1318]
• Other Damage Limitations
• Liquidated Damages
  • Missouri case law allows sophisticated parties the freedom to contractually limit future liability.[1319]  The court’s reason that parties have the freedom to make a bad bargain or relinquish fundamental rights.[1320]  Further, a contract that did not include a limitation clause would presumably carry a different price than one that does include such a provision.[1321]
  • The term “liquidated damages” refers to “that amount which, at the time of contracting, the parties agree shall be payable in the case of breach.”[1322]  Missouri courts generally uphold liquidated damages provisions in contracts “provided they are reasonable and the parties agreed in good faith upon a sum as damages that would likely ensue if the contract were breached.”[1323]