Commentary: Recent pitfalls in default judgment litigation

Public policy favors the resolution of a court case on its merits. Yet there must be practical limits on this policy, given the realities of absent litigants, demands on the judicial system, and competing policies favoring the speedy resolution of cases. Missouri rules regarding default judgments are designed to balance these interests. Two recent decisions confirm that despite some potential confusion among the rules, defaulting parties must follow a specific path to seek the setting aside of a default judgment: (1) the motion to set aside must be brought as an independent action under Rules 74.05 or 74.06 and (2) if denied, the denial of the motion must be directly appealed—not collaterally challenged with another post-judgment motion—in order to avoid the application of res judicata.

First, in Steele v. Johnson Controls, the Supreme Court of Missouri held that a motion to set aside a default judgment must be brought under Rules 74.05 or 74.06, not Rule 75.01. 688 S.W.3d 192, 199 (Mo. 2024), reh’g denied (June 4, 2024).

Rule 75.01 allows the trial court to vacate, reopen, correct, amend, or modify judgments within 30 days of entry “after giving the parties an opportunity to be heard and for good cause.”

In Steele, the defaulting party moved to set aside a default judgment within 30 days after entry. 688 S.W.3d at 199. It argued that the trial court maintained discretion to set aside the judgment within the 30-day window under Rule 75.01. The Supreme Court of Missouri rejected this alternative approach, expressly holding that “Rule 75.01 neither replaces Rule 74.05(d) when a defaulting party files a motion within 30 days of the default judgment nor negates the necessity of showing a meritorious defense. To the contrary, Rule 74.05(d) specifically provides “‘[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[.]’” Steele, 688 S.W.3d at 199 (emphasis in original).

Accordingly, Rule 74.05 remains the only vehicle for defaulting parties to set aside a judgment due to their own failure to answer or defend, while Rule 74.06 permits the setting aside of a default judgment under certain other, narrow circumstances. See Rule 74.06(b)(2) (allowing relief from a judgment for a party’s fraud, misrepresentation, or other misconduct); Rule 74.06(b)(3) (allowing relief from a judgment that is irregular); Rule 74.06(b)(4) (allowing relief from a judgment that is void); Rule 74.06(b)(5) (allowing relief from a judgment that has been satisfied, released, or discharged, or that was based on a prior judgment that has been reversed or vacated).

Second, a default judgment may not itself be directly appealed (unless the trial court lacked subject matter jurisdiction to enter the judgment, see, e.g., Robertson v. Rosner, 641 S.W.3d 436, 443 (Mo. App. W.D. 2022)). Instead, the defaulting party must file a motion to set aside a default judgment, and if that motion is denied, the defaulting party must appeal the denial within 10 days—not file additional post-judgment motions or they risk losing the right to appeal. See Rule 81.04(a).  

In Xtra Lease LLC v. United Trans Logistics, Inc., the defaulting party filed a motion to set aside the default under Rules 74.05 and 74.06. 720 S.W.3d 116, 120 (Mo. App. E.D. 2025). When the trial court denied the motion, the defaulting party filed a second Rule 74.06 motion, asking that the trial court amend the judgment to conform with the damages requested in the petition (rather than a larger amount). The trial court again denied the motion. See id. At this point, the defaulting party appealed. On appeal, the Court of Appeals for the Eastern District held that the second motion and the appeal were barred. Id. The defaulting party did not timely appeal the trial court’s denial of the first motion to set aside, and instead raised the same legal issues in a second motion. Although the defaulting party timely appealed the denial of the second motion, that motion was barred by res judicata, because it raised issues that were or should have been raised in the party’s first motion to set aside. See Xtra Lease, 720 S.W.3d at 120.

Accordingly, defaulting parties must ensure that their first motion to set aside a default judgment complies with the requirements of Rule 74.05—with affidavits to support both the meritorious defense and good cause prongs required by that rule—or Rule 74.06, and they cannot rely on Rule 75.01 to try to circumvent any of these requirements. If a motion to set aside is denied, and if the defaulting party wishes to seek appellate review, they must file a notice of appeal within 10 days of the denial of their motion—not additional motions to set aside or amend the default judgment. Otherwise, the most likely outcome is that the default judgment will remain enforceable.