Hagan v. Buchanan

Decision Date23 January 2007
Docket NumberNo. WD 66070.,WD 66070.
Citation215 S.W.3d 252
PartiesJames HAGAN & Jane Hagan, Respondents, v. David BUCHANAN, Defendant, Angelo's Tow Service, Appellant.
CourtMissouri Court of Appeals

Howard C. Gosnell, Jr., Kansas City, for appellant.

Craig Kevin Sweeney and Cynthia A. Holmes, Kansas City, for respondent.

RONALD R. HOLLIGER, Judge.

Angelo's Tow Service (hereinafter "Angelo's") appeals the denial of its motion to set aside the default judgment entered when Angelo's failed to respond or appear after being served with a summons and petition in this personal injury suit. The trial court concluded that Angelo's motion to set aside was untimely because it was filed more than a year after the default judgment was entered, though the default judgment only became final after the motion was filed. On appeal, Angelo's contends (1) the one-year time period for filing a motion to set aside a default judgment under Rule 74.05 begins to run when the judgment is final, not when the default judgment is entered, so Angelo's motion was timely; and (2) its motion to set aside the default judgment should be granted for good cause under Rule 75.01. Affirmed.

Facts

James and Jane Hagan (hereinafter collectively referred to as "Hagan") filed suit against David Buchanan and his employer, Angelo's Tow Service, for property damage, personal injuries, and loss of consortium arising from a two-vehicle collision. Angelo's and its insurer settled the property damage claim and the personal injury claim of James Hagan, but the Hagans dismissed without prejudice their claims for Ms. Hagan's personal injury and Mr. Hagan's loss of consortium because Ms. Hagan remained under treatment for her injuries. Hagan refiled the dismissed claims in the present suit on April 11, 2002. Mr. Buchanan could not be found for service of process but Angelo's registered agent was served on April 20, 2002. Hagan's attorney made phone calls to Angelo's insurer both before and shortly after the present suit was filed, as demonstrated by Hagan's attorney's phone records. Additionally, on April 22, 2002, Hagan's attorney called Angelo's registered agent and advised her to send copies of the petition to both Angelo's and its insurer. Angelo's, nevertheless, did not respond or appear.

On November 21, 2003, the trial court held a hearing at which Hagan presented evidence of damages. And on December 4, 2003, the trial court entered a default judgment including damages. Garnishment was issued on January 14, 2005, and served to Angelo's on February 2, 2005. On April 6, 2005, Angelo's moved to set aside the default judgment. On July 8, 2005, with the trial court not having addressed the motion to set aside, Angelo's filed a notice of appeal. We dismissed the appeal as premature because there was no final judgment in the case, as Mr. Buchanan was still a party and the claims against him remained unresolved. On October 12, 2005, the trial court granted Hagan's motion to dismiss Mr. Buchanan without prejudice and denied as untimely Angelo's motion to set aside the default judgment. Angelo's appeals the denial of its motion to set aside.

Discussion
I.

Angelo's first point on appeal contends that because the judgment was not final and appealable until Mr. Buchanan was dismissed, the time allowed to move to set aside the default judgment also did not begin to run until Mr. Buchanan was dismissed. The thrust of Angelo's argument is that the trial court erred in concluding that Angelo's motion to set aside the default judgment was filed past the one-year time limit in Rule 74.05(d). Inexplicably, Angelo's first point on appeal does not even mention Rule 74.05, although the motion to set aside refers exclusively to it. Angelo's first point relies instead on abrogated default judgment statutes, which Angelo's did not raise to the trial court, and which we address later in the opinion.

The relevant text of Rule 74.05, which governs this case, reads as follows:

(a) When a party against whom a judgment for affirmative relief is sought has failed to plead or otherwise defend as provided by these rules, upon proof of damages or entitlement to other relief, a judgment may be entered against the defaulting party. . . .

....

(d) Upon motion stating facts constituting a meritorious defense and for good cause shown, a default judgment may be set aside. The motion shall be made within a reasonable time not to exceed one year after the entry of the default judgment.

Also relevant is Rule 74.01, applicable to all judgments, subsection (a) of which states, `Judgment' as used in these rules includes a decree and any order from which an appeal lies. A judgment is rendered when entered. A judgment is entered when a writing signed by the judge and denominated `judgment' or `decree' is filed.

Read together, Rules 74.01(a) and 74.05(d) say a judgment is entered when filed and a party may move to set aside a default judgment within one year of its entry. Here, the judgment was entered December 4, 2003, and Angelo's moved to set it aside April 6, 2005, well after one year from the entry of judgment. The trial court applied this reading of the Rules. But we must also consider Rule 74.01(b), which reads as follows:

When more than one claim for relief is presented in an action, whether as a claim, counterclaim, cross-claim, or third-party claim, or when multiple parties are involved, the court may enter a judgment as to one or more but fewer than all of the claims or parties only upon an express determination that there is no just reason for delay. In the absence of such determination, any order or other form of decision, however designated, that adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties shall not terminate the action as to any of the claims or parties, and the order or other form of decision is subject to revision at any time before the entry of judgment adjudicating all the claims and the rights and liabilities of all the parties.

See also, former Rule 74.08, Mo. Rules of Court (1987).

Angelo's contends that this language means the judgment here was nothing more than an interlocutory order subject to revision. We recognize Rule 74.01(b)'s care in referring to any other form of decision and making that other form of decision subject to revision at any time before the entry of judgment. Indeed, on the facts before us, Rules 74.01(a) and 74.01(b) appear to contradict one another. On one hand, the judgment was entered when first filed and signed, under Rule 74.01(a). On the other hand, the judgment was no judgment at all (but was an other form of decision) until there was an entry of judgment adjudicating all the claims and the rights and liabilities of all the parties under Rule 74.01(b). The precise question we must decide is whether the judgment was entered, starting the one-year clock for Rule 74.05(d), when first filed, or when Mr. Buchanan was dismissed.

The answer lies in the distinctive character of a default judgment. A default judgment cannot, itself, be appealed. Kuhlman v. Arnold, 154 S.W.3d 430, 431 (Mo.App.W.D.2005). Instead, the motion to set aside is treated as an independent action, and the decision to grant or deny the motion is an independent judgment. Moore v. Baker, 982 S.W.2d 286, 288 (Mo. App. W.D.1998) (citing Kueper v. Murphy Distrib., 834 S.W.2d 875, 878 (Mo.App. E.D.1992)); see Order of Missouri Supreme Court, June 27, 2006 (amending Rule 74.05(d), adding sentence effective Jan. 1, 2007: "A motion filed under this Rule 74.05(d), even if filed within 30 days after judgment, is an independent action and not an authorized after-trial motion subject to Rule 78.04 or Rule 78.06."). As we explained in Moore, Rule 74.05, effective January 1, 1988, changed the time limitations and allowed a motion to set aside a default judgment to be filed up to one year after entry of the default. "This new time provision serve[d] to sharply distinguish motions to set aside default judgments from motions for new trial and other motions in the nature thereof." [T]he courts now consider [a motion] to set aside a default judgment to be an independent action. 982 S.W.2d at 288 n. 2 (quoting Clark v. Brown, 794 S.W.2d 254, 256 (Mo. App.1990)). We therefore hold that when a motion to set aside a default judgment is made more than one year after the default judgment was filed, denominated "judgment," and signed by the judge, the motion is untimely even if the judgment is not yet "final" for all other purposes. Here, the one-year clock began to run when the default judgment was "entered," not when the judgment became "final" because the unserved defendant was dismissed. The motion was, therefore, untimely.

Angelo's relies heavily on Mo.Rev.Stat. Section 511.130, last revised in 1939, but we find it unavailing, as it is abrogated by Rule 74.01(b). See Rule 41.02 (the Rules supersede all statutes and existing court rules inconsistent therewith). Angelo's argues that, under section 511.130, the judgment here was interlocutory, and it, therefore, did not start the clock on Rule 74.05 until it became final. Angelo's asserts that section 511.130 was applied in Beckmann v. Miceli Homes, Inc., 45 S.W.3d 533, 539 (Mo.App. E.D.2001), and that the statute therefore remains applicable to default judgments. Beckmann discusses the statute only for the purpose of explaining that "interlocutory" judgments are not "final" judgments, and concludes that the trial court did not err in calling its decision an "interlocutory judgment" instead of an "interlocutory order" or simply a "judgment" as the terms are used in Rule 74.05. Id. at 539-40. Beckmann does not apply the statute; it merely cites the statute as historical evidence that there can be only one "final" judgment in a case. It says nothing about when the clock runs under Rule 74.05. And whether the...

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    ...aside the default judgment pursuant to Rule 74.05(d). As earlier indicated, a default judgment cannot be appealed. Hagan v. Buchanan, 215 S.W.3d 252, 255 (Mo.App. W.D.2007). Because the decision to grant or deny that motion is itself an independent judgment, the trial court was correct in r......
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    ...to the trial court. "We will not consider arguments not raised below and made for the first time on appeal." Hagan v. Buchanan, 215 S.W.3d 252, 257 (Mo.App. W.D.2007). Appellant's first argument Appellant next contends that the trial court erred in finding that a meritorious defense had not......
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