                       United States Court of Appeals
                          FOR THE EIGHTH CIRCUIT
                                 ___________

                               No. 96-1794/1795
                                ___________

National Liberty Corporation;          *
Worldwide Underwriters Insurance       *
Company,                               *
                                       *
      Appellants/Cross Appellees,      *
                                       *
      v.                               * Appeal and Cross-Appeal from the
                                       * United States District Court for the
Wal-Mart Stores, Inc., doing business * Eastern District of Missouri.
as Sam's Club; Sedgwick James of       *
Arkansas, Inc.,                        *
                                       *
      Defendants,                      *
                                       *
Sedgwick James Group Service, Inc.,    *
                                       *
      Appellee/Cross Appellant.        *
                                  ___________

                           Submitted: January 15, 1997
                               Filed: August 13, 1997
                                ___________

Before BEAM, ROSS and HANSEN, Circuit Judges.
                           ___________

ROSS, Circuit Judge.
       National Liberty Corporation and Worldwide Underwriters Insurance Company
(collectively referred to as National Liberty) appeal from the district court’s1 denial of
their Fed. R. Civ. P. 50(b) motions for judgment as a matter of law or alternatively for
a new trial on the counterclaim of Sedgwick James Group Service, Inc. (SJGS), for
which the jury awarded SJGS $202,023 in damages. SJGS’s counterclaim was a single
cause of action for breach of contract based on a contract originally entered into
between National Liberty and Sedgwick James of Arkansas, Inc. (SJA). In its motion
for Rule 50(b) relief, National Liberty argued that SJGS failed to establish privity of
contract between the parties, whereas no evidence was offered to show that SJGS had
satisfied the contractual requirement that written consent was needed in order to
effectuate an assignment. National Liberty also asserts that even if SJGS had a right
to sue under the contract, the amount of the allowable recovery is limited by the terms
of the contract and precludes the type of damages awarded by the jury. SJGS cross
appeals on the district court’s denial of its untimely motion to amend its counterclaim
to assert a claim for attorney’s fees. After a careful review of the record, briefs and
arguments of the parties, we affirm in full.

                                            I.

       National Liberty, a company engaged in direct-mail marketing and sales of
insurance policies, entered into a contract entitled the “referral agreement” with SJA,
which called for the two companies to work together on a plan to market National
Liberty’s insurance products to Sam’s Club members. SJA, broker of record for Sam’s
Club, acted as intermediary between National Liberty and Sam’s Club via an entity
known as Members Insurance Club (MIC). Through MIC, National Liberty began
offering insurance to Sam’s Club members. Under the terms of the referral agreement,



      1
       The Honorable Catherine D. Perry, United States District Court Judge for the
Eastern District of Missouri.

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SJA was to receive a 2.5% commission on premiums for insurance policies issued to
and renewed by Sam’s Club members.

       In December 1993, due to the loss of major corporate business, SJA was forced
to close its Tulsa office, the same office that managed MIC. Prior to the closing, SJA
arranged for SJGS to assume its role in marketing National Liberty insurance to Sam’s
Club members, and accordingly SJGS received a broker of record letter from Sam’s
Club, which allowed SJGS to contact all insurance carriers providing insurance to
Sam’s Club members through MIC. According to SJGS, National Liberty was
informed of the change and immediately began working with SJGS.

       In February 1994, Sam’s Club terminated the insurance program. As a result,
National Liberty discontinued paying commissions to SJGS and brought a multi-count
action against SJA, SJGS and Sam’s Club. In response, SJGS brought this
counterclaim against National Liberty seeking payment of commissions under the
referral agreement.

        A jury returned a verdict in favor of SJGS, SJA and Sam’s Club on National
Liberty’s suit. The jury also found in favor of SJGS on its counterclaim, concluding
that National Liberty owed SJGS commissions on premiums received now and those
to be collected from future renewals. Thereafter, the district court denied National
Liberty’s Rule 50(b) motion for judgment as a matter of law or alternatively for a new
trial on the counterclaim.

       During the pendency of the trial, SJGS filed an untimely motion for leave to file
an amended counterclaim seeking attorney’s fees provided for under the referral
agreement, and prejudgment interest pursuant to Mo. Rev. Stat. § 408.020. The district
court refused to allow SJGS to file its amended counterclaim and later denied SJGS’s
post-trial motion to consider the issue of attorney’s fees.


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                                         II.

      National Liberty first asserts that the counterclaim should not have been
submitted to the jury because SJGS failed to establish that it was a proper party to
assert a breach of the referral agreement which had originally been entered into
between National Liberty and SJA. SJGS argues, on the other hand, that by its
actions, National Liberty consented to the assignment of the referral agreement to
SJGS, thereby effectively waiving the contractual requirement that an assignment be
made in writing.

       Under Missouri law, waiver is the intentional relinquishment of a known right
which may be implied from a party’s conduct. To be so implied, the party’s conduct
must “be so manifestly consistent with and indicative of an intention to renounce a
particular right or benefit that no other reasonable explanation of [the] conduct is
possible.” Silver Dollar City v. Kitsmiller Constr. Co., 931 S.W.2d 909, 916 (Mo. Ct.
App. 1996) (citation omitted).

        SJGS introduced evidence at trial that once it assumed SJA’s role in marketing
insurance to Sam’s Club members, it promptly notified National Liberty by letter that
SJGS had been appointed as Sam’s agent and broker of record with respect to all
Sam’s Club members’ insurance programs and that with the closing of the SJA office,
all commissions, information, phone calls, etc. should be directed to SJGS. Linda
Berger, senior account manager for National Liberty, acknowledged receipt of that
letter, beginning with the salutation, “Welcome to the SAM’s account!” Shortly
thereafter, an introductory meeting between SJGS and National Liberty management
was held. Ms. Burger testified at trial regarding her understanding that the SJA
business would be transferred to SJGS and that the program would continue as it had
been. She stated that “[t]hey [SJGS] were going to do the same things that [SJA] had
done for us.”


                                         -4-
      Also at trial, SJGS’s expert, Bob Seiffert, testified that National Liberty sent
commission checks to SJGS and agreed to reissue those checks payable to SJGS after
SJGS complained that the payee had been incorrectly listed as SJA. Only after the
program was canceled by Sam’s Club did National Liberty refuse to make any further
commission payments. However, National Liberty continued to keep a ledger of
commissions owed but not paid to “Sedgwick James Group Ser.”

       Clearly, there was sufficient evidence presented at trial to submit the
counterclaim to the jury and for the jury to conclude that SJGS had effectively stepped
into SJA’s shoes with respect to the referral agreement. Indeed, National Liberty read
to the jury the following request for admission by National Liberty and SJGS’s
response to that admission:


      21. SJGS succeeded to and assumed the same rights, duties and
      obligations possessed by SJA in its relationship with plaintiffs with regard
      to the sales, marketing, and promotion of insurance to Sam’s Club
      members.

      Response: SJA and SJGS admit the request.


      By its own actions, National Liberty exhibited its clear and unequivocal intention
to accept SJGS’s assignment and thereby waived its right under the agreement to
require written consent to the assignment.


      We also reject National Liberty’s argument that the waiver and assignment
arguments are raised for the first time on appeal and thus the issues were not before the
trier of fact. On the contrary, the jury was specifically instructed that in order to find
in favor of SJGS on its counterclaim it must determine that SJGS “assumed the rights


                                           -5-
of [SJA] and [National Liberty] agreed to pay [SJGS] the commissions due under the
referral agreement.” Instruction No. 22. The jury clearly found in SJGS’s favor on this
point.


                                          III.


         National Liberty next challenges the nature of the damages awarded to SJGS
under the referral agreement. The jury awarded damages in the amount of $76,000 in
past commissions and $117,000 in future commissions, based on a ten-year projection
of renewals of policies sold before termination of the insurance program, discounted
to present value. With interest, the total damages awarded to SJGS amounted to
$202,023. National Liberty contends that the language of the referral agreement, which
provides that National Liberty shall pay commissions on “all first year and renewal Net
Collected Premium actually received,” precludes the jury verdict of $117,000 awarded
for the projected future commissions. According to National Liberty, the referral
agreement, which calls for payment of commissions “within thirty (30) days of the end
of the month in which [National Liberty] actually receives the premium,” establishes
a method of calculation and mode of payment that prohibits an award of damages
based on premiums not yet received. We disagree.


         An anticipatory repudiation by an obligor to a contract gives the obligee the
right to treat the agreement as broken and to sue immediately for damages for a total
breach of contract. Reed v. Reberry, 883 S.W.2d 59, 63, 64 (Mo. Ct. App. 1994).
Under the terms of the agreement, SJGS was entitled to receive commissions on all
“first year and renewal” premiums generated from the sale of insurance policies to

                                          -6-
Sam’s Club members. National Liberty unequivocally renunciated the referral
agreement and its obligations thereunder when it refused to continue the payment of
commissions. Accordingly, SJGS had the option to treat the contract as broken and to
sue immediately for damages for total breach, including damages based on projected
premium renewals. Once National Liberty repudiated the referral agreement, it waived
its right to insist upon adherence to the mode of payment outlined in the agreement.


                                           IV.


      In its cross appeal, SJGS argues that the district court abused its discretion in
denying its motion to amend its counterclaim seeking to assert a claim for attorney’s
fees under the terms of the referral agreement2 and in denying its post-trial motion for
attorney’s fees. Attorney’s fees are “special damages” that parties are required to
plead under Rule 9(g) of the Federal Rules of Civil Procedure. See Western Cas. &
Surety Co. v. Southwestern Bell Tel. Co., 396 F.2d 351, 356 (8th Cir. 1968). Failure
to plead special damages can be cured by amendment of the pleadings, under Rule
15(a) of the Federal Rules of Civil Procedure, which provides that a party may amend
a pleading “only by leave of court or by written consent of the adverse party; and leave
shall be freely given when justice so requires.” Fed. R. Civ. P. 15(a). The decision to


      2
       Paragraph 8 of the referral agreement provides:

      8. Indemnification. The parties hereby agree to indemnify, release and
      hold the other parties hereto . . . harmless from and against any and all
      losses . . . including, but not limited to, reasonable attorney fees that such
      other parties may incur as a result of or relating to the indemnifying
      party’s breach of this Agreement.

                                           -7-
grant or deny a motion to amend a pleading is within the sound discretion of the
district court. Brown v. Wallace, 957 F.2d 564, 565 (8th Cir. 1992). SJGS contends
that in seeking to file its amended counterclaim, it was merely clarifying the damages
it alleged it was entitled to under the referral agreement.


      According to the district court’s scheduling order, March 30, 1995 was the
deadline for any amendments to the pleadings. SJGS filed its motion for leave to
amend on June 23, 1995, almost three months after the court’s deadline, without
explanation for its untimeliness. The district court found that National Liberty would
be prejudiced by the untimely amendment because it had already completed depositions
of witnesses who were likely to have knowledge of such a claim, and adding the claim
after the amendment deadline would have required retaking those depositions. We do
not believe the finding of prejudice was clearly erroneous. The district court also
denied the post-trial motion, concluding that SJGS had two opportunities to plead
attorney’s fees -- in the initial counterclaim and in a timely Rule 15 motion. SJGS
failed to do so and has not asserted any reason for its failure. The court did not abuse
its discretion in denying the motions relating to attorney’s fees.


                                           V.


      In sum, we conclude that privity of contract was established and the
counterclaim was properly before the jury; the damage award relating to commissions
on future renewals was proper; and the court did not abuse its discretion in denying
SJGS’s motions regarding attorney’s fees. The judgment of the district court is
affirmed.

                                           -8-
A true copy.


      Attest:


               CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.




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