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Marck Industries, Inc. v. Lowe

Court of Appeals of Missouri, Southern District, First Division

November 18, 2019


          APPEAL FROM THE CIRCUIT COURT OF BARRY COUNTY Honorable Alan M. Blankenship

          GARY W. LYNCH, P.J.

         Cathy Lowe ("Lowe") and Billy Rouse ("Rouse") (collectively, "Appellants") appeal the trial court's entry of a judgment against them as a discovery sanction. Because Appellants have failed to demonstrate the trial court committed any reversible error, we affirm the judgment.

         Facts and Procedural Background

         Respondents Marck Industries, Inc. and RL Transport, LLC (collectively, "Respondents") filed a petition against Appellants for conversion, fraud, civil conspiracy, punitive damages, and breach of fiduciary duty. Appellants filed an answer to the petition. The matter was set for a one-day bench trial beginning on October 27, 2017.

         On July 26, 2017, Respondents served Appellants with their Second Set of Interrogatories and Second Request for Production of Documents (collectively, "Second Discovery Requests"). Appellants filed a motion for additional time to answer the Second Discovery Requests. On August 31, 2017, the trial court granted Appellants' request for more time and gave them an additional twenty days to respond to the Second Discovery Requests, making their responses due on or before September 20, 2017.

         Appellants failed to respond to the Second Discovery Requests, and on September 27, 2017, Respondents filed a motion to enforce discovery and sanctions. A hearing on that motion was held on October 2, 2017.[1] Following that hearing, the trial court entered an order providing that "[i]f [Appellants] have not provided complete discovery answers before 5:00 PM on October 9, 2017, this Court shall strike the pleadings of [Appellants] and enter a default judgment in favor of [Respondents] and against [Appellants]."

         On October 10, 2017, Appellants filed certificates of service of responses to the Second Discovery Requests. The next day, Respondents filed a motion for sanctions, alleging Appellants did not provide any bank records of the individuals for the relevant time and no records at all for C&B Trucking, LLC. Appellants filed a response on October 12, 2017. A motion hearing was held on October 26, 2017, the day before the scheduled trial, and Appellants were "ordered to produce all requested discovery without fail." The trial was reset for March 8, 2018.

         On January 12, 2018, Respondents filed a second motion for sanctions alleging that discovery was incomplete. Appellants did not file a response to this motion. The court scheduled a hearing on the motion for February 5, 2018.

         On January 31, 2018, Appellants provided bank records for C&B Trucking. Appellant Rouse, however, provided only two of his individual bank statements: an August 2013 statement from Security Bank and a February 2013 statement from People's Bank.

         On February 5, 2018, a hearing was held and the court granted Respondents' second motion for sanctions and struck Appellants' pleadings as a discovery sanction. Thereafter, Respondent filed a motion for default judgment.

         Appellants filed a motion to reconsider the striking of Appellants' pleadings ("Motion to Reconsider"). In their motion, Appellants alleged that they "believe that all documents responsive to all of the requests of [Respondents] have been produced" and that "while Appellant, Cathy Lowe has been convicted of embezzling funds from [Respondents], the co-defendant, Billy Rouse, was never indicted or charged for that crime." Respondents filed suggestions in opposition to the Motion to Reconsider, arguing that Appellant Rouse failed to produce "complete records for three (3) bank accounts he purportedly maintained during the relevant time period."

         On June 4, 2018, the trial court held a hearing on Appellants' Motion to Reconsider and Respondents' Motion for Default Judgment. At the hearing, Appellants' counsel stated that they had produced "everything that's out there …."[2] The trial court denied Appellants' Motion to Reconsider and entered an Order of Default on June 5, 2018. An evidentiary hearing was then scheduled for the purpose of determining Respondents' damages.

         On November 21, 2018, after a hearing on damages, the court entered judgment against Appellants jointly and severally in the amount of $130, 957.02. On December 19, 2018, Appellants filed a "Motion to Vacate, Reopen, Correct, Amend, or Modify Judgment Pursuant to Missouri Rule of Civil Procedure 75.05(d),[3] or Alternatively for a New Trial Pursuant to Missouri Rule[s] of Civil Procedure 78.01 and 78.04" (the "Motion to Set Aside"). In that motion, Appellants "request[ed] that the default [j]udgment be set aside since [Appellants] have a meritorious defense and good cause exists."

         Appellants filed a timely Notice of Appeal. The trial court never ruled on Appellants' Motion to Set Aside.


         Before we can turn to the merits of Appellants' appeal, we must resolve whether we have jurisdiction to hear Appellants' appeal. There can be no appeal absent a final judgment. Giesler v. Burling Northern R. Co., 791 S.W.2d 491, 492 (Mo.App. 1990). "Because finality of judgment is a jurisdictional prerequisite, this Court must dismiss an appeal from an order that is not final." Id.

         Respondents argue that we are without jurisdiction to review this matter because a party may not directly appeal the entry of a default judgment and the trial court has not ruled on Appellants' Motion to Set Aside. "Generally, a default judgment is not appealable." Heineck v. Katz, 509 S.W.3d 116, 122 (Mo.App. 2016). A default judgment can only be appealed if the trial court heard a motion to set aside or vacate the judgment under Rule 74.05(d). Id. Such a motion filed "under … 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, 78.06, or 81.05." Rule 74.05(d). We reject Respondents' argument, however, because the judgment entered in this case is not a default judgment as contemplated under Rule 74.05.

         Judgment on the Merits-Not ...

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