Hinton v. Proctor & Schwartz, Inc.

• Decision Date: 14 January 2003
• Docket Number: No. ED 80700.,ED 80700.
• Citation: Hinton v. Proctor & Schwartz, Inc., 99 S.W.3d 454 (Mo. App. 2003)
• Parties: Bobby HINTON and Linda Hinton, Plaintiffs/Respondents, v. PROCTOR & SCHWARTZ, INC. and Wolverine (Massachusetts) Corporation, Defendants/Appellants.
• Court: Missouri Court of Appeals

Page 454

99 S.W.3d 454

Bobby HINTON and Linda Hinton, Plaintiffs/Respondents, v. PROCTOR & SCHWARTZ, INC. and Wolverine (Massachusetts) Corporation, Defendants/Appellants.

No. ED 80700.

Missouri Court of Appeals, Eastern District, Division Four.

January 14, 2003.

COPYRIGHT MATERIAL OMITTED

John McCollough, Helfrey, Simon & Jones Law Firm, Clayton, MO, for Appellants.

Daniel A. Raniere, Aubuchon, Aubuchon & Raniere Law Firm, St. Louis, MO, for Respondents.

Introduction

SHERRI B. SULLIVAN, Judge.

Proctor & Schwartz, Inc. (Proctor) and Wolverine (Massachusetts) Corporation (WMC) (collectively Appellants) appeal from a default judgment entered by the trial court on a petition filed by Bobby Hinton and Linda Hinton (collectively Respondents). We affirm.

Factual and Procedural Background

In September 1994, Proctor and WMC merged, with WMC becoming the surviving corporation. In September 1999, WMC changed its name to Wolverine Proctor & Schwartz, Inc. (WP&S).

In October 2000, Respondents filed a petition for personal injuries and loss of consortium based on several product liability theories against Appellants. The petition alleged that in February 1997, Bobby Hinton sustained serious and permanent injuries to his right upper extremity, including the amputation of the fingers of his right hand, while at his place of employment using a machine designed, manufactured, sold and distributed by Appellants. Respondents also alleged that Linda Hinton, as Bobby's wife, suffered the loss of consortium with her husband as a result of his injuries.

During the year 2000, CT Corporation System (CT Corp) was the registered agent for WP&S. WP&S instructed CT Corp to forward all summons and petitions directed to WP&S to the law firm of Epstein, Becker & Green in Boston, Massachusetts. CT Corp also had been the registered agent for WMC prior to its name change to WP&S.

On October 20, 2000, Respondents' counsel requested the Circuit Court of the City of St. Louis to issue separate summonses directed to the Sheriff of Philadelphia County, Pennsylvania for service on Proctor and WMC by serving registered agent CT Corp. On October 24. 2000, the Circuit Court of the City of St. Louis issued separate summonses to Proctor and "Wolverine Corp."

On October 30, 2000, Respondents' counsel forwarded the summonses and the petition to the Sheriff of Philadelphia County, Pennsylvania for service. On November 3, the Office of the Sheriff of Philadelphia County returned the summonses and the petition for improper service fee amount and failure to include envelopes for return of affidavit of service. On November 13, Respondents' counsel again forwarded the summonses and the petition with the correct service fee and return envelopes to the Sheriff of Philadelphia County, Pennsylvania for service. The sheriffs office served the summonses and the petition as directed on December 7, 2000.

Neither Proctor nor WMC entered an appearance or filed an answer or responsive pleading in the cause of action.

On February 1, 2001, Respondents filed a Motion for Default Judgment, in which Respondents requested a hearing on the motion. On February 9, 2001, the trial court held a hearing on the motion, at which Appellants failed to appear. On February 10, 2001, the trial court entered a default judgment against Appellants and in favor of Respondents in the amount of $2,300,000.¹

On August 21, 2001, CT Corp mistakenly forwarded a transmittal form and a trial docket notice directed to Proctor to a New Jersey company unrelated to Proctor, WMC or WP&S. The company returned the documents to CT Corp. On August 24, 2001, CT Corp forwarded to the law firm of Epstein, Becker & Green the trial docket notice directed to Proctor and the envelope used by the New Jersey company to return the documents to CT Corp. Appellants allege that receipt of these documents was their first notice of Respondents' cause of action.

Subsequently, WP&S contacted the clerk's office for, the Circuit Court of the City of St. Louis and Respondents' counsel to obtain information about Respondents' cause of action. WP&S also obtained local counsel in St. Louis.

On October 16, 2001, Appellants filed a Motion to Vacate Default Judgment (Motion to Vacate) pursuant to Rule 74.05(d).² Attached to the motion was a document designated as an affidavit of Stephen D. Riden (Riden), an associate in the law firm of Epstein, Becker & Green, as well as other exhibits. The purported affidavit was not notarized. Respondents filed suggestions in opposition to the motion, along with exhibits. After a hearing, the trial court denied the motion on November 28.

On November 30, 2001, Appellants filed a Motion for Reconsideration of Motion to Set Aside Default (Motion for Reconsideration). Attached to the motion was Riden's purported affidavit in notarized form, as well as two other affidavits and other exhibits. The trial court also denied this motion after a hearing.

On December 3, 2001, Appellants filed a Motion for Relief from Judgment (Motion for Relief) pursuant to Rule 74.06(b)(4), along with affidavits and exhibits. Respondents filed a response to the motion. The trial court also denied this motion.

Appellants filed a notice of appeal from the denial of their Motion to Vacate and the denial of their Motion for Relief. Appellants filed another notice of appeal from the denial of their Motion for Reconsideration. Subsequently, Appellants filed a Motion to Consolidate Appeals, which we granted.

Discussion

Appellants raise two points on appeal. In their first point, Appellants argue that the trial court abused its discretion in denying their Motion to Vacate and Motion for Reconsideration because Appellants demonstrated a meritorious defense and good cause and the Motion to Vacate was timely filed.

A motion to set aside a default judgment is governed by the sound discretion of the trial court. Klaus v. Shelby, 42 S.W.3d 829, 831 (Mo.App. E.D.2001). We will interfere with that discretion only if the record convincingly demonstrates abuse. Id. We afford the trial court broad discretion in granting a motion to set aside a default judgment and narrow discretion in denying a motion to set aside default judgment. Id. The reason for the differing standards is the distaste our system holds for default judgments. Id.

Rule 74.05(d) governs the setting aside of default judgments. The rule provides in pertinent part:

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. Good cause includes a mistake or conduct that is not intentionally or recklessly designed to impede the judicial process.

The party moving to set aside a default judgment has the burden of proof to convince the trial court that the party is entitled to relief. In re Marriage of Pierce, 867 S.W.2d 237, 238 (Mo.App. S.D. 1993). To determine compliance with the pleading requirements of Rule 74.05(d), we look to the allegations in the defaulting party's motion, and such other documents as affidavits, exhibits, and proposed answers. Yerkes v. Asberry, 938 S.W.2d 307, 309 (Mo.App. E.D.1997). Bare statements amounting to mere speculations or conclusions fail to meet the pleading requirements. Id.

A motion to set aside a judgment cannot prove itself. Rocky Ridge Ranch Property Owners Ass'n v. Smith, 14 S.W.3d 623 (Mo.App. E.D.1999). The motion must be verified or supported by affidavits or sworn testimony produced at the hearing on the motion. Id.

As the trial court found,³ Appellants' Motion to Vacate was not verified nor did Appellants produce sworn testimony at the hearing on the motion. As evidence of good cause, Appellants attached Riden's purported affidavit to the motion. However, we cannot consider the statement as evidence of good cause because Riden's purported affidavit was not properly before the trial court.⁴

Riden's purported affidavit was not properly before the trial court because

it was not a valid affidavit. An affidavit is a written declaration on oath sworn to by a person before someone authorized to administer such oath. Estep v. Atkinson, 886 S.W.2d 668, 674 (Mo.App. S.D.1994). Courts, judges, justices, clerks of courts, notaries public, certified court reporters, and certified shorthand reporters are authorized to administer oaths. Section 492.010.⁵ Riden's purported affidavit did not include an oath sworn to before someone authorized to administer an oath. Thus, the document signed by Riden was merely an unworn statement. See Estep, 886 S.W.2d at 674.

Even if the purported affidavit had been notarized, as it was when attached to Appellants' Motion for Reconsideration, Riden's purported affidavit also was insufficient evidence of good cause because it was not made on the personal knowledge of Riden.⁶ An affidavit must be made on personal knowledge. Midwest Precision Casting Co. v. Microdyne, Inc., 965 S.W.2d 393, 395-396 (Mo.App. E.D. 1998). In the absence of an allegation of personal knowledge, the contents of an affidavit become inadmissible hearsay. Id. at 396. Hearsay statements contained in an affidavit are not facts admissible in evidence and should not be considered by a trial court. Id. Riden's purported affidavit does not allege that it was made on personal knowledge. As the trial court found:

Because no one with personal knowledge testified as to what happened to the summons and petition, the affidavit is hearsay and cannot be considered by the Court as evidence of good cause. There was no affidavit from a representative of CT Corp who could testify with personal knowledge as to what happened to the summons and petition.

Thus, to support the good cause requirement of their Motion to Vacate, Appellants attached an invalid affidavit that was based primarily on hearsay. The trial court did not err in not considering the...