text:
    Thomas J. BUENEMAN and, Donna Bunes Bueneman, Plaintiffs/Appellants, v. James ZYKAN, Jr., Diane Frankenberg, Ray Frankenberg, and Elizabeth Frankenberg, Defendants/Respondents.
    No. ED 85897.
    Missouri Court of Appeals, Eastern District, Division Four.
    Oct. 18, 2005.
    Motion for Rehearing and/or Transfer to Supreme Court Denied Dec. 7, 2005.
    Application for Transfer Denied Jan. 31, 2006.

      Earl Robert Schultz III, Phillips Corri-gan — co-counsel, Chesterfield, MO, for plaintiffs/appellants.
    James Zykan, Washington, MO, pro se.
    Howard Stern Smotkin, St. Louis, MO, for Diane Frankenberg.
    Isidore Ireland Lamke, Washington, MO, for Ray and Elizabeth Frankenberg.
   SHERRI B. SULLIVAN, J.

Introduction

Thomas Bueneman (Thomas) and Donna Bueneman (Donna) (collectively Appellants) appeal from the summary judgment entered by the trial court in favor of Ray Frankenberg (Ray), Elizabeth Franken-berg (Elizabeth) (collectively the Franken-bergs), and Diane Frankenberg (Diane) (collectively Respondents), and from the court’s order in favor of Respondents on their joint Motion to Dismiss Party; Alternative Motion to Enter Protection Order and/or Order Separate Trial; or Alternative Motion for Express Determination that Judgment is Final and There is No Just Reason for Delay. In this order, the trial court dismissed the remaining defendant, James Zykan (Zykan). We reverse and remand for further proceedings.

Facts and Proceedings Below

In 1992, the State of Missouri began investigating environmental violations by Zykan and his companies involving landfills and improper disposal of waste. On October 8, 1993, Zykan married Diane. On October 25, 1993, Zykan transferred certain lake property he owned individually to himself and Diane as tenants by the entirety. On March 18, 1994, the State brought suit against Zykan and his companies. Appellants, farmers who live outside Wright City, were cross-claimants in the suit, alleging environmental violations against their own property. In September 1994, Diane and Zykan sold the lake property to Diane’s parents, the Frankenbergs. On November 17, 1997, Appellants obtained a judgment against Zykan in the amount of $642,782.03. On September 4, 1998, Appellants filed suit against Zykan and Elizabeth (collectively the Zykans) and the Frankenbergs for transferring the lake property to defraud creditors. Appellants effected service against the Zykans by publication in the Washington Missourian pursuant to Missouri Rule of Civil Procedure 54.12(c), because attempted personal service in Missouri and service by registered mail in Belize, where the Zykans had moved, were unsuccessful.

On September 20, 1999, the trial court entered summary judgment in favor of the Frankenbergs, determining that there was no disputed issue of material fact hindering their entitlement to judgment as a matter of law on Appellants’ fraudulent conveyance claim.

On March 28, 2000, the trial court entered a default judgment against the Zy-kans personally for a total of $779,244.99. On April 13, 2000, counsel for the Zykans filed a special limited entry of appearance and motion to set aside the default judgment on the basis that the trial court did not have personal jurisdiction over them. No answer or other pleadings were filed by the Zykans. On July 12, 2000, the trial court set aside the default judgment based on lack of personal jurisdiction, but found that the Zykans’ entry, motion and challenge to the default judgment conferred personal jurisdiction over them and ordered them to respond within thirty days. The Zykans failed to file a response and the trial court entered a second default judgment against them on September 14, 2000.

On July 10, 2001, we reversed the trial court’s September 20, 1999 entry of summary judgment in favor of the Frankenbergs in Bueneman v. Zykan, 52 S.W.3d 49 (Mo.App. E.D.2001). In Bueneman, we granted Appellants’ single point on appeal alleging that there was a material issue of fact concerning the amount the Franken-bergs paid for the lake house that the Zykans transferred to them, thus making summary judgment improper. Id. at 57.

On March 22, 2002, Appellants filed the first amended petition in the instant case which alleges Fraudulent Conveyance, Constructive Trust and Money Had and Received against the Zykans and the Frankenbergs. Diane and the Franken-bergs filed a motion for summary judgment claiming that the statute of limitations had run on these claims against them. The trial court agreed. They also maintained that Zykan should be dismissed as the only remaining defendant since he had already transferred the .lake property at issue to them and thus he had no ownership interest in the property. The trial court agreed and dismissed Zy-kan. This appeal follows.

Points on Appeal

Appellants present five points on appeal. In their first point, Appellants claim that the trial court erred in granting summary judgment to Respondents because there are no material undisputed facts which entitle Respondents to judgment, because this Court previously declared that Respondents are not entitled to summary judgment; because Appellants had substantial evidence supporting every element of their claims; because the amount the Frankenbergs paid for the lake house is in dispute; and because even if the Franken-bergs had paid $143,000.00 for the lake house, Diane never paid anything and even with payment a fraudulent conveyance may be shown.

In their second point, Appellants allege that the trial court erred in granting summary judgment to Respondents because as a matter of law the statute of limitations had not run before Appellants filed suit, because they brought their suit within one year of receiving the judgment against Zykan which liquidated and established their claims, and before the underlying judgment Appellants had no claim against Respondents for fraudulent conveyance; they brought their suit within one year of learning of Respondents’ fraudulent conveyance; there is no evidence that Appellants knew about the fraudulent conveyance more than one year before bringing this lawsuit, and Respondents’ allegations that Appellants should have known is a disputed fact issue; and MUFTA’s limitations period should be tolled during the years that the Zykans concealed their misconduct and evaded service of process by fleeing to Belize.

In their third point, Appellants maintain that the trial court erred in granting summary judgment on their constructive trust claim over the proceeds of the fraudulent conveyance because constructive trust is a remedy that may be imposed even if no confidential relationship existed between Appellants and Respondents.

In their fourth point, Appellants contend that the trial court erred in granting summary judgment on their money had and received claim because this claim may arise even if Appellants had no direct dealings with Respondents.

In their fifth point, Appellants assert that the trial court erred in granting Respondents’ motion to dismiss Zykan or to certify this case for appeal because Respondents have no standing to dismiss claims against another defendant; the claims against Zykan are proper and supported by substantial evidence and Zykan has been served by publication; and no basis to certify the summary judgment as final for appeal exists nor is the decision explained in the court’s order.

Standard of Review

When considering appeals from summary judgments, the Court will review the record in the light most favorable to the party against whom judgment was entered. ITT Commercial Fin. Corp. v. Mid-Am. Marine, 854 S.W.2d 371, 376 (Mo.banc 1993). Appellate review is essentially de novo. Id. The criteria on appeal for testing the propriety of summary judgment are no different from those which should be employed by the trial court to determine the propriety of sustaining the motion initially. Id.

Our standard of review for the trial court’s dismissal of a party is governed by Murphy v. Carron, 536 S.W.2d 30 (Mo. banc 1976), and we must uphold the trial court’s judgment unless it is not supported by substantial evidence, is against the weight of. the evidence, or the court has erroneously declared or applied the law. Id. at 32.

Discussion

Point I

In their first point, Appellants assert that the trial court erred because there are disputed issues of material fact as to the elements of their fraudulent conveyance claim. However, Respondents’ motions for summary judgment were based on the running of the statute of limitations for a fraudulent conveyance claim, not on the absence of disputed issues of material fact as to the elements of a fraudulent conveyance claim. The trial court’s granting of the motions, without discussion, is deemed to be based on one or more of the arguments asserted within the motion. Because this argument was not raised in the motions for summary judgment, and thus not relied on by the trial court in its judgment, Appellants need not argue it here. As such, point one is denied.

Point II

In their second point Appellants maintain that the statute of limitations on their fraudulent conveyance claim had not run before they filed suit. Section 428.049 provides the limitations period for a fraudulent conveyance claim:

Extinguishment of claim for relief or cause of action

A claim for relief or cause of action with respect to a fraudulent transfer or obligation under sections 428.005 to 428.059 is extinguished unless action is brought:
(1) Under subdivision (1) of subsection 1 of section 428.024, within four years after the transfer was made or the obligation was incurred or, if later, within one year after the transfer or obligation was or could reasonably have been discovered by the claimant;
(2) Under subdivision (2) of subsection 1 of section 428.024 or subsection 1 of section 428.029, within four years after the transfer was made or the obligation was incurred; or
(3) Under subsection 2 of section 428.029, within one year after the transfer was made or the obligation was incurred.

Appellants assert that they brought their claim within one year of learning of the fraudulent transfer, Section 428.049(1), and Respondents have failed to prove otherwise. Although Appellants do not cite a specific date upon which they learned of the fraudulent transfer, they maintain that on November 17, 1997, they obtained a judgment against Zykan in the amount of $642,782.03, which Zykan failed to honor, and on September 4, 1998, within one year of obtaining this judgment, they filed their suit for fraudulent transfer. Appellants’ position is that they only discovered the fraudulent transfer when they attempted to execute on the judgment, and they should not reasonably have been expected to discover the fraud prior to the date they obtained a judgment against Zykan.

Respondents claim that the deed from Zykan to Diane and Zykan as tenants by the entirety was recorded on October 27, 1993, and thus was a matter of public record as of that time and is deemed notice to Appellants. In support of their point, Respondents cite Gibson v. Ransdell, 188 S.W.2d 35, 38 (Mo.1945), where our Supreme Court held that the appellant’s cause of action, if any, to set aside conveyances on the ground that they were fraudulent and void as to creditors accrued upon the filing of the deeds for record and any applicable statute of limitations ran from that date; and Coleman v. Alderman, 357 Mo. 758, 210 S.W.2d 994, 996 (1948), where the Court said that since the action was filed more than ten years after the recording of the deeds sought to be set aside it was barred by the (then) ten-year statute of limitations.

Both of these cases were decided well before the statute at issue was enacted in 1992. Therefore, they are not persuasive authority in this case. Section 428.049 specifically states when the transfer was or could reasonably have been discovered by the claimant. We don’t believe that Appellants reasonably could be expected to search the recorder of deeds before they even obtained a judgment against Zykan, or before they realized their judgment was not going to be paid by Zykan. It is not reasonable to expect Appellants to see into the future and realize that they will obtain judgment against Zykan, Zykan will flee the country and not pay the judgment, and therefore Appellants are going to have to investigate his property and transactions concerning his property to determine if any have been fraudulent, so that they can bring an action for fraudulent transfer of such property if such fraud is found, in order to finally fulfill their judgment. Such a scenario suggested by Respondents is unreasonable.

Further, the purpose of the recording laws in general is to establish a priority between innocent claimants to the same property, not to give security to the perpetrators of fraud as against their victims. Saidawi v. Giovanni’s Little Place, Inc., 987 S.W.2d 501, 507 (Mo.App. E.D.1999), citing W.W. Allen, Annotation, Public Records As Notice Of Facts Starting Running Of Statute Of Limitations Against Action Based On Fraud, 137 A.L.R. 268, 276 (1942).

‘The proposition is frequently announced that, under the registration laws, the proper record of an instrument authorized to be recorded is notice to all the world. But this means simply that the record is open to all, and is notice to interested parties. The record of an instrument is notice only to those who are bound to search for it. It is not a publication to the world at large. The recording of a deed or mortgage, therefore, is constructive notice only to those who have subsequently acquired some interest or right in the property under the grantor or mortgagor.’ 23 RCL p. 211, s 71.
‘It is apparent, therefore, that where a court decides that a defrauded party is charged with notice of facts appearing from the records, so as to start the running of the statute of limitations against his action, the ruling cannot well be based on the recording laws, because those laws have reference to the outstanding rights and interests of third persons and are intended to give protection to those who in good faith acquire interests in reliance upon the records and who meet the conditions laid down. The recording laws establish a priority as between innocent claimants to the same property or right; they are not intended to give security to the perpetrators of fraud as against their victims. As pungently stated in Andrews v. Smithwick (1870) 34 Tex. 544, * * *, the recording laws do not make ‘provision for the registration of fraud.’
‘ * * * (T)he purpose of recording laws is to notify persons acquiring title or rights subsequent to those of record, and not to give protection to the perpetrators of fraud. * * * ’

Dreckshage v. Community Fed. Sav. and Loan Ass’n, 555 S.W.2d 314, 319-320 (Mo. banc 1977), quoting Allen, supra.

Respondents also claim that Diane told Appellants about the transfer of the lake property in her February 1995 deposition. Respondents maintain that Diane testified that Zykan transferred the lake property to Zykan and herself jointly after their marriage and that they subsequently sold the lake property to the Franken-bergs. We cannot glean from the deposition testimony where Diane clearly states that Zykan transferred the lake property to Zykan and herself jointly after their marriage. Furthermore, Diane did not produce the deed for the transfer of the lake property despite a subpoena asking for production of “all deeds for real estate.”

Based on the failure of their arguments, we find that Respondents are not entitled to judgment as a matter of law on the statute of limitations issue. Further, we find that there exists a fact issue as to when Appellants should have known of the transfer. We are not sure what date the trial court determined that to be since it made no findings. However, where the running of the statute of limitations depends upon when the plaintiff discovered or by reasonable diligence could have discovered the fraud, a question of fact is presented. Brown v. Scheible, 814 S.W.2d 5, 7 (Mo.App. E.D.1991), citing Schwartz v. Lawson, 797 S.W.2d 828, 833 (Mo.App. W.D.1990).

Since we have found that summary judgment was inappropriate in this case because Respondents failed to show they were entitled to judgment as a matter of law and there is a remaining fact issue, we need not address Appellants’ additional argument that MUFTA’s limitations period should be tolled during the years that Zy-kan and Diane concealed their misconduct and evaded service of process by fleeing to Belize.

Point II is granted.

Points III and TV

In their third and fourth points, Appellants assert that the trial court should not have granted summary judgment on their constructive trust and money had and received claims. Constructive trust is a. remedy based on Appellants’ fraudulent transfer action. Money had and received is a claim contingent upon Appellants’ successfully maintaining their fraudulent transfer action. Summary judgment as to these claims is inappropriate in light of our reversal of the summary judgment on Appellants’ fraudulent transfer action.

Diane argues that Appellants’ constructive trust claim fails as a matter of law because she never had a fiduciary or confidential relationship with Appellants. However, such a relationship is not a requirement for a constructive trust claim. “A constructive trust is a method by which a court exercises its equitable powers to ‘remedy a situation where a party has been wrongfully deprived of some right, title, benefit or interest in property as a result of fraud or in violation of confidence or faith reposed in another.’ ” Fix v. Fix, 847 S.W.2d 762, 765 (Mo. banc 1993), citing Schultz v. Schultz, 637 S.W.2d 1, 4 (Mo. banc 1982) (emphasis added by the court). The object of the constructive trust is to restore to the rightful owner the property wrongfully withheld by the defendant. Fix, 847 S.W.2d at 765, citing March v. Gerstenschlager, 436 S.W.2d 6, 8 (Mo.1969).

Diane also argues, as do the Frankenbergs, that they never took or received any money from Appellants in order to justify a money had and received claim. However, such a claim is not limited to such a literal interpretation. Rather, “[a]n action for money had and received” is a very broad and flexible action, which seeks to reach monies which in equity and good conscience ought not to be retained by the defendant but ought to be paid to plaintiff. It is a legal action, but based upon equitable principles. The tendency of the courts is to widen rather than restrict its scope. Alarcon v. Dickerson, 719 S.W.2d 458, 461 (Mo.App. W.D.1986).

For the foregoing reasons, we find that the trial court improperly granted Respondents summary judgment on Appellants’ constructive trust and money had and received claims. Points III and IV are granted.

Point V

In their fifth and final point, Appellants allege that that the trial court erred in granting Respondents’ motion to dismiss Zykan or to certify this case for appeal because Respondents have no standing to dismiss claims against another defendant; the claims against Zykan are proper and supported by substantial evidence and Zykan has been served by publication; and no basis to certify the summary judgment as final for appeal exists nor is the decision explained in the court’s order.

Respondents claimed in their motion to dismiss Zykan that he had transferred the property at issue and thus no longer has any interest in it, and therefore should be dismissed under Missouri Rule of Civil Procedure 52.06, which allows the court to dismiss misjoined parties. However, Zy-kan is a central party to Appellants’ fraudulent transfer claim. His actions are at the heart of their claim, and he is properly a defendant along with Respondents under Missouri Rule of Civil Procedure 52.05, which provides:

All persons may be joined in one action as defendants if there is asserted against them jointly, severally, or in the alternative, any right to relief in respect of or arising out of the same transaction, occurrences or series of transactions or occurrences and if any question of law or fact common to all of them will arise in the action.

Perhaps the trial court determined that since it had granted to Respondents summary judgment on the fraudulent transfer claim, it may as well dismiss Zykan. The trial court made no findings in its order, and thus we are left only to speculate. In any event, we determine that the trial court erred in granting Respondents’ motion to dismiss Zykan since he is clearly a necessary party to this action. We need not visit the issue of their standing to even pursue such a motion since the granting of it was clearly in error for substantive reasons.

Appellants’ claim that the trial court had no basis to certify the summary judgment as final for appeal is moot due to our reversal of that judgment.

For the foregoing reasons, Point V is granted.

The trial court’s summary judgment in favor of Respondents and its order dismissing Zykan are reversed. This cause is remanded for further proceedings consistent with this opinion.

NANNETTE A. BAKER, P.J., and ROBERT G. DOWD, JR., J., concur.

      . MUFTA is the Missouri Uniform Fraudulent Transfer Act, Sections 428.005-428.059, RSMo 1992.

      . All statutory references are to RSMo 1992, unless otherwise indicated.

      . Rule 52.06 provides:
      Misjoinder of parties is not ground for dismissal of an action. Parties may be dropped or added by order of the court on motion of any party or of its own initiative at any stage of the action and on such terms as are just. Any claim against a party may be severed and proceeded with separately.


source: Caselaw Access Project

author: MARY K. HOFF, Presiding Judge.

license: Public Domain

text:
    Melanie R. NEWBILL, Appellant, v. Margretta FORRESTER-GAFFNEY and Walker Gaffney, Respondents, and First National Bank of St. Louis and Ziercher & Hocker, P.C., Trustee, Defendants.
    No. ED 85237.
    Missouri Court of Appeals, Eastern District, Division One.
    Oct. 25, 2005.
    Motion for Rehearing and/or Transfer to Supreme Court Denied Dec. 7, 2005.
    Application for Transfer Denied Jan. 31, 2006.

      William E. McCurdy, Jr., St. Louis, MO, for Appellant.
    William Arnold Hellmich II, St. Louis, MO, for respondents Margretta Forres-ter-Gaffney and Walker Gaffney.
    Garry Lee Vincent, St. Louis, MO, for respondents First National Bank of St. Louis and Ziercher & Hocker, P.C.
   MARY K. HOFF, Presiding Judge.

Melanie R. Newbill (Newbill), individually and in her capacity as trustee of the Melanie R. Newbill Revocable Trust (Trust), appeals from that portion of the judgment- entered in favor of Defendants Margretta Forrester-Gaffney and Walker Gaffney (the Gaffneys),- First National Bank of St. Louis, and Ziercher & Hocker, P.C., Trustee, in Newbill’s action to quiet title. Judgment affirmed as modified.

Background

Newbill and her former husband, James Brooks Newbill, purchased a home at 12 Lenox Place in the City of St. Louis in 1972. The Newbills divorced in 1990 and James Brooks Newbill conveyed his interest in the property to Newbill, who subsequently conveyed the property to the Trust. Newbill continues to reside at the property.

The Gaffneys purchased the property adjacent to Newbill’s property, 10 Lenox Place, in January 2001. This dispute arose following the Gaffneys’ decision to install a fence across a strip of land that lay between their driveway and Newbill’s sun porch. Newbill initiated litigation to assert claims concerning, among other things, this strip of land. The fence, as installed, runs in an east-west direction beginning at the Gaffneys’ residence, continuing across their driveway and across the disputed strip, and abuts (but does not -touch) the concrete foundation of Newbill’s sun porch.

Newbill’s first amended petition set forth eleven counts: Count I — Quiet Title/Adverse Possession Against All Defendants; Count II — Prescriptive Easement on the Disputed Property Against All Defendants; Count III — Trespass Against Gaffneys; Count IV — Injunction Against Gaffneys; Count V — Quiet Title/Adverse Possession of Area B Against All Defendants; Count VI — Prescriptive Easement on Area B Against All Defendants; Count VII — Quiet title/Adverse Possession of Area C Against All Defendants; Count VIII — Quiet Title/Adverse Possession of Area D Against All Defendants; Count IX — Quiet Title/Adverse Possession of Area E Against All Defendants; Count X — Prescriptive Easement on Area E Against All Defendants; and Count XI— Quiet Title/Adverse Possession of Area F Against AH Defendants.

Following a bench trial on July 14, 2004, the court entered judgment making specific findings of fact and conclusions of law. In its judgment, the court entered judgment in favor of Defendants and against Newbill on Counts I, II, III, IV, V, VIII, and IX. As to Count X, the court entered judgment in favor of Newbill, granting her a prescriptive easement in a parcel referred to as the “brick walkway” for the sole purpose of allowing Newbill to maintain or repair her home. With respect to Counts VI and XI, the court entered judgment in favor of Newbill, granting her a prescriptive easement in the described property for the sole and limited purpose of a foundation for her sun porch and allowing for the eaves, gutter, and roof overhang on the porch. The court also entered judgment in favor of Newbill on Count VII, quieting title to the described parcel in Newbill subject to a prescriptive easement in favor of Defendants in the property situated adjacent to the Gaffneys’ detached garage for the limited purpose of maintaining the garage. Additional facts will be developed throughout this opinion as needed for our analysis.

Analysis

Newbill raises seven points on appeal, with numerous subpoints. Much of New-bill’s brief attempts to characterize the testimony of various witnesses and attacks credibility findings made by the trial court. For purposes of clarity, we decline to address Newbill’s argument subpoint by sub-point. Instead, we shall address the issues as they relate to the trial court’s determinations in a manner we find more conducive to analysis.

One of Newbills’ claims of error addresses the trial court’s adoption of the Gaffneys’ findings of fact and conclusions of law. The remaining claims of error, including one concerning Newbill’s trespass count, essentially concern two parcels of land owned by the Gaffneys: 1) the side yard, a strip of land lying between New-bill’s house and the Gaffneys’ driveway measuring approximately 11 feet wide and 61 feet long, which includes a small area occupied by Newbill’s sun porch foundation and the eaves and gutters directly above the foundation, as well as a brick walk edging the porch; and 2) a narrow wedge of land adjacent to the Gaffneys’ garage measuring approximately 19 square feet.

In bench-tried cases, we affirm the trial court’s decision unless its judgment is unsupported by substantial evidence, is against the weight of the evidence, or erroneously declares or applies the law. Murphy v. Carron, 536 S.W.2d 30, 32 (Mo. banc 1976).

Seventh-Point — Adoption of the Findings of Fact and Conclusions of Law

In her seventh point, Newbill claims the trial court erred in adopting verbatim proposed findings of fact and conclusions of law offered by the Gaffneys because the findings were not consistent with the actual facts and the conclusions of law were not sufficiently specific to permit meaningful review. She argues that it is not clear that the trial court carefully examined each cause of action and the evidence. We disagree. Given our standard of review, we find no inconsistencies between the trial court’s findings of fact and the actual facts and have determined the legal conclusions were sufficiently specific to permit meaningful review. As a result, in this case, we find no error in the trial court’s adoption of the proposed findings of fact and conclusions of law. Investors Title Co. v. Chicago Title Ins. Co., 983 S.W.2d 533, 537 (Mo.App. E.D.1998). Point denied.

First Point — Adverse Possession of The Side Yard Strip, Including Brick Walk Area

In her first point, Newbill argues the trial court erred in granting judgment for the Gaffneys as to her claim for adverse possession of the side yard described in her petition, a strip of land lying between her house and the Gaffneys’ driveway measuring approximately 11 feet wide and 61 feet long, because there was no substantial evidence to support the judgment, the judgment was against the weight of the evidence, and the trial court erroneously declared and applied the law.

An individual claiming by adverse possession must prove by the preponderance of the evidence the existence of every element of adverse possession for the entire ten-year statutory period; failure to prove just one element is fatal to the claim. Dobbs v. Knoll, 92 S.W.3d 176, 180-81 (Mo.App. E.D.2002). Therefore, to succeed on such a claim, the plaintiff must demonstrate her possession was actual, open and notorious, exclusive, continuous, and hostile and under a claim of right. Id. at 180.

In its findings of fact and conclusions of law, the trial court noted that the determinative issue regarding Newbill’s claim to the side yard was whether New-bill’s use and maintenance of the strip was “(a) hostile and under a claim of right; and (b) exclusive.” The trial court concluded Newbill’s use and maintenance of the strip was permissive. In reaching its determination, the trial court expressly found much of Newbill’s testimony to be not credible, and correspondingly, specifically found witnesses testifying on behalf of the Gaffneys to be credible.

In the first point of her argument on appeal, Newbill states that the case before us is not one in which we must defer to the trial court’s credibility determinations, specifically not as to the testimony of James Brooks Newbill. Newbill then proceeds in her sub-points and sub-subpoints to take exception to the trial court’s findings.

We remind Newbill that we review court-tried cases under the standards set forth in Murphy v. Carron, 536 S.W.2d at 32. Acknowledging the trial court’s superior ability to determine witness credibility, we defer to its findings of fact and view the evidence and all reasonable inferences most favorably to the trial court’s decision. Wallace v. Grasso, 119 S.W.3d 567, 572 (Mo.App. E.D.2003). “Conflicts in the evidence were for the trial court to resolve, and the facts must be taken in accordance with the result reached.” Thomas v. King, 160 S.W.3d 445, 448 (Mo.App. S.D.2005). In accordance with these principles, we find the following facts determinative on the issue of permissiveness.

During trial, James Brooks Newbill testified that during the time he and Newbill jointly owned the property located at 12 Lenox Place, from 1972 to 1990, he understood that the side yard located between their house and the neighboring driveway was owned by their neighbors at 10 Lenox Place, the Torrences. He further testified that, sometime after he and Newbill purchased 12 Lenox Place they decided to sod their front yard. James Brooks Newbill then asked Mrs. Torrence if she would agree to him sodding from his front lot over to her driveway, an area which would include the north half of the side yard. Mrs. Torrence agreed to the sodding. Mrs. Torrence also agreed to caution her children about driving over the area in consideration of the expense the Newbills would incur in sodding that part of the Torrence’s yard. After the sodding, the Newbills mowed and raked the side yard.

Subsequently, James Brooks Newbill decided to install a sprinkler system for the Newbills’ yard. He spoke to Mrs. Torrence before he did so, and although he designed his system to sprinkle the area of Mrs. Torrence’s side yard that he had sodded, he was careful to ensure none of the piping or fixtures extended into her property.

Donald Torrence, Mrs. Torrence’s son, also testified at the hearing. He lived at 10 Lenox Place from his birth in 1956 until approximately 1980. During that time, Donald Torrence knew that the side yard between the driveway of 10 Lenox Place and the Newbills’ sun porch belonged to his family because his family had a framed copy of the property’s survey hanging in their hallway. While he lived at 10 Lenox Place, Donald Torrence also mowed and raked leaves on the side yard.

The Torrences sold the property at 10 Lenox Place to Rhea and Cheryl Gustafson in 1996. Deposition testimony from the Gustafsons was read into the record during the hearing. The Gustafsons owned the 10 Lenox Place property until they sold it to the Gaffneys in December 2000. During this time, the Gustafsons understood that they owned the side yard between their driveway and Newbill’s sun porch; the survey they received when they bought the house clearly indicated that the side yard was part of the 10 Lenox Place property.

After he and his family moved in, Rhea Gustafson and Newbill discussed the mowing of the sideyard. Rhea Gustafson gave Newbill permission to cut the grass on the front of the side yard when she cut her yard because it made sense for the adjoining areas to be cut at the same time and “made for a nice clean look[.]” Rhea Gus-tafson mowed the back area of the side yard to keep the underbrush down, raked and vacuumed leaves on the side yard in the fall, cut back ivy, picked up fallen sticks, and planted bulbs. He tried to grow grass on the back part of the side yard but was unsuccessful because of the shade. He hired a tree service to trim the trees in the side yard. When Newbill asked if she could trim the limbs of a tree in the side yard to prevent squirrels from jumping into her attic, Rhea Gustafson acquiesced.

In late fall of 2000, Newbill asked to buy the side yard before the Gustafsons sold their home. After Cheryl Gustafson told Newbill that they could not sell the side yard to Newbill because they had listed the entire property, Newbill commented that she hoped the new neighbors were nice and would let her continue to mow the front part of the side yard so that her yard would look nice.

Walker Gaffney (Gaffney) testified during the hearing. He and his wife purchased the house at 10 Lenox Place in January of 2001 and moved into the house the following March. They had a survey prepared in connection with the purchase and were familiar with the boundaries of the property.

After he and his family moved in, Gaff-ney began mowing the side yard and raking debris that fell from the trees planted there. Gaffney later noticed that New-bill’s lawn service was mowing the side yard down to his driveway and informed its worker that he was mowing part of Gaffneys’ property. Gaffney had a tree removed from the side yard because he determined it was undesirable. In a subsequent conversation he had with her, Newbill commented that she thought the removal was a good idea.

Later, Gaffney and his wife decided they wanted to install a new fence on their property. The existing fence was decrepit and unsightly, and they wanted to install the new fence closer to the front of their property to allow their children more play area and to make it more difficult for outsiders to access their backyard. Gaff-ney discussed his intention to fence the side yard with Newbill and told her he would need to remove some of the bricks around her sun porch so that he could install the footing for his proposed fence. When Gaffney speculated as to the purpose for the bricks, suggesting it was perhaps to prevent run-off from splashing mud on the side of the house, Newbill said that she did not know why they were there. Gaffney showed Newbill how the fence would run from his house, across the driveway and the side yard, to the edge of Newbill’s sun porch. Newbill told him she was sure anything Gaffney did would look nice. However, the following weekend, a man who identified himself as Newbill’s boyfriend approached Gaffney as he was outside and told Gaffney that the fence was not going to work for Newbill.

Shortly after this conversation, Newbill talked to Gaffney about the fence and told him that she would be unable to access her sun porch to maintain it if he extended the fence across the side yard to the porch. Gaffney told her he would be happy to give her a key to the fence’s gate and further suggested cutting a gate in the fence between the two property’s backyards to allow access. Their conversation became increasingly heated. When Gaffney told Newbill that he did not think he needed her permission to build a fence on his property, Newbill told him she had a lawyer looking at the issue. Ultimately, for aesthetic reasons, the fence was built just a little forward of the location Gaffney originally showed Newbill.

Clearly, substantial evidence supports the trial court’s determination that Newbill’s use and maintenance of the side yard was permissive. Permissive use negates the element of hostility required for adverse possession. Ross Farms, Inc. v. Moore, 873 S.W.2d 308, 309 (Mo.App. S.D.1994). Because failure to prove even one element is fatal to a claim of adverse possession, we conclude the trial court did not err in granting judgment for the Gaffneys as to Newbill’s claim for adverse possession of the side yard. Point denied.

Fourth Point — Prescriptive Easement of Part of Side Yard

Newbill’s fourth point on appeal claims the trial court erred in granting judgment in favor of the Gaffneys on her claim for a prescriptive easement on the side yard, including a brick walk adjacent to the sun porch. The determination that Newbill’s use and maintenance of the side yard was permissive is dispositive of this point, as well. “Mere permissive use of land cannot ripen into an easement.” Carpenter-Union Hills Cemetery Ass’n v. Camp Zoe, Inc., 547 S.W.2d 196, 200 (Mo.App.1977). Point denied.

Second Point — Adverse Possession of Small Strip by Brick Walkway

In her second point, Newbill claims the trial court erred in granting judgment for the Gaffneys on her claim for adverse possession of the small strip occupied by the brick walk area adjacent to Newbill’s sun porch because there is no substantial evidence to support the judgment, it is against the weight of the evidence and the trial court erroneously declared and applied the law. As with the previous point, the trial court found that Newbill’s use of this area (designated “Area E” in Count IX of Newbill’s petition) was permissive and not hostile. Substantial evidence supports the trial court’s finding. Point denied.

Third Point — Adverse Possession of Area Occupied by Newbill’s Sun Porch Foundation, Eaves, and Gutters

In her third point, Newbill claims the trial court erred in granting judgment for the Gaffneys on her claim for adverse possession of the ground occupied by the foundation of Newbill’s sun porch and the eaves and gutters directly above the foundation because there is no substantial evidence to support the judgment, it is against the weight of the evidence, and the trial court erroneously declared and applied the law. Newbill’s petition referred to her sun porch’s gutter and eaves as “Area B” and her sun porch foundation as “Area F.”

During the hearing, Newbill presented the testimony of a registered land survey- or (Surveyor) who prepared a survey of 12 Lenox Place and the boundary line with 10 Lenox Place on Newbill’s.behalf. Survey- or prepared a detail of the area occupied by the sun porch that indicated the front corner of the sun porch’s concrete footing extended .25 feet (approximately 3 inches) over the boundary line, and thereafter tapered to the boundary line after a distance of approximately 5 feet (approximately 1.25 square feet). Surveyor also prepared a legal description for the foundation of Newbill’s sun porch, which was described in Newbill’s Exhibit 30 as “Parcel for Footing of Frame Addition.” Surveyor did not prepare a separate legal description of the eaves and gutters because they had approximately the same protrusion as the footings. The legal description Surveyor prepared for the foundation described an area of approximately 10.25 square feet (dimensions of .50 feet by 20.50 feet). This legal description is the one Newbill designated as both “Area B” and “Area F” in Counts V, VI, XI.

Initially, we note that the legal description prepared by Surveyor appears inconsistent with the area detailed in his survey. Furthermore, two other surveys were admitted during the hearing, the Gaffneys’ Exhibits C and D. Exhibit D, a survey prepared on January 10, 2001, shows a distance of .5 feet between the boundary line and Newbill’s sun porch. Exhibit C was executed January 14, 1953, and shows a distance of 7¾ inches between the front corner of Newbill’s sun porch and the boundary line and a distance of 4)4 inches between the back corner of the sun porch and the boundary line.

Regardless of which survey or measure we consider, the encroachment Newbill is claiming is very minimal, involving, at most, an area of 10.25 square feet. “When the injury is small, equitable relief should not be granted.” Newmark v. Vogelgesang, 915 S.W.2d 337, 339 (Mo.App. E.D.1996).

Furthermore, one of the elements Newbill must demonstrate to succeed on her claim of adverse possession is that her possession of the property was actual. Dobbs, 92 S.W.3d at 180-81. Actual possession requires the plaintiff to show the ability to control the land and the intent to exclude others from control. Contemporary Mgmt., Inc. v. 1007 Olive P’ship, 760 S.W.2d 135, 138 (Mo.App. E.D.1988). Where, as here, the deed from which the plaintiff acquired title did not attempt to convey the property at issue, the plaintiff must show physical possession of the entire disputed area. Id. Here, the evidence before the trial court as to the actual location of the sun porch’s foundation, eaves and gutters was inconclusive and conflicting. Even the legal description of the area provided by Surveyor appears inconsistent with the area as portrayed in his survey. Given the minimal nature of the alleged encroachment and Newbill’s failure to demonstrate this actual possession by the preponderance of the evidence, we find no error in the trial court’s grant of judgment for the Gaffneys on Newbill’s claim as to the property described in her petition as “Area B” and “Area F.” Dobbs, 92 S.W.3d at 180-81 (failure to prove just one element is fatal to claim of adverse possession). Point denied.

Siocth Point — Trespass Claim

In her sixth point, Newbill argues that the Gaffneys’ erection of a fence and other acts performed on the property in dispute were trespasses and that exclusion of intruders and protection of children were not reasons justifying extending the fence on Newbill’s property. Given our determination that Newbill failed to establish her claim of adverse possession as to this property, the Gaffneys’ erection of a fence and performance of other acts on property to which they hold legal title could hardly be termed trespasses. Trespass is the unauthorized entry upon the land of another. Rosenfeld v. Thoele, 28 S.W.3d 446, 449 (Mo.App. E.D.2000). Point denied.

Fifth Point — Easement Regarding Narrow Wedge of Property Adjacent to the Gaffneys’ Garage

Finally, in her fifth point, Newbill argues the trial court erred in granting the Gaffneys a prescriptive easement on “Area C” as described in Count VII of Newbill’s petition because the Gaffneys pleaded no claim for a prescriptive easement as to this area, there was no evidence that the Gaff-neys or any of their predecessors in title ever used “Area C,” and none of the elements required for the grant were satisfied. “Area C,” a narrow wedge of the Gaffneys’ property located adjacent to the Gaffneys’ garage, was awarded to Newbill by the trial court.

Issues tried by express or implied consent of the parties shall be treated in all respects as if they had been raised in the pleadings. Rule 55.33(b). Furthermore, pleadings may be amended as necessary to cause them to conform to the evidence adduced at trial at any time, even after judgment. Id. During the hearing, Gaffney testified that “Area C” was enclosed by Newbill’s backyard fence and stated that he would like to be able to access the wedge of property adjacent to his garage for future maintenance purposes such as tuckpointing the west side of his garage. Newbill did not object when Gaffney indicated that he would like some sort of relief from the court to allow him this access, therefore, this issue was tried with her implied consent.

In its decision, the trial court granted judgment to Newbill on her adverse possession claim to Area C and quieted title in her favor. In conjunction with its award to Newbill, the trial court granted the Gaffneys a prescriptive easement in the parcel for the limited purpose of maintaining their garage.

Prescriptive easements are established when a claimant acts in a manner such as to indicate that he claims a nonexclusive right to use another’s property without recognition of the owner’s authority to permit or prohibit his use. Whittom v. Alexander-Richardson P’ship, 851 S.W.2d 504, 508-09 (Mo. banc 1993). Here, until the trial court’s award to New-bill, the Gaffneys were the title owners of the narrow wedge. Given their ownership, we need not determine whether the evidence showed the Gaffneys or their predecessors ever used “Area C” because an owner cannot claim adversely against himself. Id. at 509 (adverse use is necessary prerequisite in context of prescriptive easements); Brick House Cafe & Pub, L.L.C. v. Callahan, 151 S.W.3d 838, 844 (Mo.App. W.D.2004) (one cannot claim adversely against himself).

Accordingly, the trial court’s award of a prescriptive easement in this area is not supported by substantial evidence and is against the weight of the evidence. However, although the evidence presented at trial does not support the award of a prescriptive easement, the evidence was sufficient to support awarding the Gaffneys an easement by necessity in “Area C” to enable them to maintain the west side of their garage.

For an easement by necessity to arise, there must have been: 1) a unity of ownership of the dominant and servient estates; 2) the unity of title must have been severed by a conveyance in one of the tracts, resulting in the grantor or grantee owning a parcel which is landlocked; and 3) the use of the servient estate by the dominant estate must be necessary. See King v. Jack Cooper Transport Co., Inc., 708 S.W.2d 194, 197 (Mo.App. W.D.1986) (plaintiff and defendant must have a common source of title to their properties; severance of estate must have left owner of one of the severed parcels without means of ingress or egress); Henderson v. LaCapra, 307 S.W.2d 59, 64 (Mo.App. W.D.1957) (foundation of easement must be necessity and not convenience).

Although the trial court used the term “prescriptive easement” in its grant to the Gaffneys, we conclude the trial court meant “easement by necessity.” We accordingly modify, pursuant to Rule 84.14, the trial court’s judgment only by deleting its reference to its grant of an easement as a “prescriptive easement” and inserting in its place the term “easement by necessity.”

As so modified, the judgment is affirmed.

CLIFFORD H. AHRENS, J., and PATRICIA L. COHEN, J., Concur.

      . First National Bank of St. Louis and Ziercher & Hocker, P.C., Trustee, did not appear or participate at the trial below and have not filed briefs on appeal.

      . We note that Newbill's brief is not in compliance with Rule 84.04. Notably, Newbill’s first point contains subpoints (A) through (R) with sub-subpoints. The briefing deficiencies, particularly Newbill's Points Relied On, arguably, could justify dismissing this appeal. However, we will address Newbill’s claims of error in an effort to achieve finality and to discourage further litigation between the parties.


author: LISA WHITE HARDWICK, Judge.

text:
    Michael L. CARROLL, Respondent, v. MISSOURI INTERGOVERNMENTAL RISK MANAGEMENT ASSOCIATION, Appellant, Missouri United School Insurance Council, Amicus Curiae.
    No. WD 64180.
    Missouri Court of Appeals, Western District.
    Oct. 25, 2005.
    Motion for Rehearing and/or Transfer to Supreme Court Denied Dec. 20, 2005.
    Application for Transfer Denied Jan. 31, 2006.

      David P. Bub, St. Louis, MO, for Appellant.
    Michael S. Shipley, Kansas City, MO, for Respondent.
    Leslie A. Greathouse, Kansas City, MO, for Amicus Curiae.
    Before SMART, P.J., HOLLIGER and HARDWICK, JJ.
   LISA WHITE HARDWICK, Judge.

In this equitable garnishment action, the circuit court granted summary judgment, allowing Michael Carroll to recover $150,000 from the Missouri Intergovernmental Risk Management Association (MIRMA) as the insurer for the City of Stanberry. MIRMA appeals, contending the court incorrectly applied the law in determining it was obligated to pay on a claim that was submitted untimely.

Factual and PROCEDURAL History

On October 8, 1999, Michael Carroll was injured in a vehicular collision that occurred when he ran a stop sign in Stanber-ry, Missouri (“City”). On November 21, 2000, Carroll’s attorney sent a letter to the City alleging Carroll's injuries were caused by the City’s negligence in failing to trim an overgrown tree that obscured the stop sign. Based on this negligence allegation, Carroll filed a lawsuit against the City on December 15, 2000.

At all times relevant herein, the City was a member of MIRMA, a non-profit association of fifty-eight municipalities organized under Section 537.620-537.650 and authorized as an “insurance entity” by the Missouri Department of Insurance. The City notified MIRMA’s claims administrator about Carroll’s lawsuit on January 11, 2001. MIRMA promptly denied the claim as untimely. MIRMA’s “Claims Handling Procedures” required that claim forms be completed and in the mail "within forty-eight hours of the incident which gave rise to a claim, or within forty-eight hours of the member’s first knowledge of the incident. The procedure also allowed a grace period of up to thirty days for notification of a claim. MIRMA denied coverage because it did not receive the City’s claim until fifty-one days after the City first had knowledge of Carroll’s accident and negligence allegation.

Prior to trial in the negligence lawsuit, Carroll agreed, pursuant to Section 537.065, to seek collection from MIRMA for any judgment against the City. Carroll presented his case at trial, and the City offered no evidence. The court found in Carroll’s favor, awarding him $150,117.30 in damages based on the City’s negligence.

Carroll filed an equitable garnishment action against MIRMA to collect on the judgment against the City. As an affirmative defense, MIRMA asserted the City’s claim was not covered due to its untimely submission. Both Carroll and MIRMA filed motions for summary judgment addressing whether MIRMA was required to show prejudice to avoid payment of an untimely claim. MIRMA stipulated that no prejudice resulted from the late claim notice but argued that it was not subject to the prejudice requirement as a “self-insurance” association organized under Section 537.620.

The court granted summary judgment in favor of Carroll, concluding that MIR-MA was required to show prejudice and had failed to do so in denying coverage on the City’s claim. The court entered a garnishment ordering MIRMA to pay the judgment of $150,117.30, plus costs and interest.

Points on Appeal

MIRMA raises three points on appeal, all contending the circuit court erroneously applied the law in granting Carroll’s summary judgment motion. Point I asserts the court erred in determining MIRMA was subject to the judicially created requirement that “insurers” must demonstrate prejudice before denying coverage on an untimely filed claim. Point II argues that even if MIRMA was an insurance company, the court erred in determining the prejudice requirement applied to the “self-insurance risk pool” created by MIRMA and its members. Point III asserts the equitable garnishment action failed to state a proper claim for relief because MIRMA is not an insurance company.

STANDARD OF REVIEW

Rule 74.04(c)(6) permits a trial court to enter summary judgment if “the motion, the response, [and] the reply ... show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” Our review of a summary judgment is de novo, as the determination is purely an issue of law. ITT Commercial Fin. Corp. v. Mid-Am. Marine Supply Corp., 854 S.W.2d 371, 376 (Mo. banc 1993). The record is reviewed in the light most favorable to the party against whom judgment was entered, and the non-movant is given the benefit of all reasonable inferences from the record. Id.

A movant’s right to summary judgment differs significantly depending upon whether the movant is a claimant or defending party. Id. at 381. A claimant must establish there is no genuine dispute as to any material facts on which the claimant would have the burden of persuasion at trial. Id. If an affirmative defense has been raised, the claimant must also establish the absence of one or more facts necessary to prove the defense. The claimant must demonstrate that the affirmative defense fails as a matter of law. Id.

Discussion

This is an action for equitable garnishment, pursuant to Section 379.200, where an injured party can seek recovery against a tortfeasor’s insurer. The plaintiff, therefore, “stands in the shoes of the insured, and his rights are no greater and no less than the insured’s would have been in an action between the insured and the insurer” on the policy. Meyers v. Smith, 375 S.W.2d 9, 15 (Mo.1964); see also Johnston v. Sweany, 68 S.W.3d 398, 400-401 (Mo.banc 2002).

It is undisputed that the City of Stan-berry had liability coverage under MIR-MA’s plan at the time of Carroll’s accident. MIRMA refused coverage on the sole ground that the City failed to submit a claim within thirty days of its first knowledge of the accident and allegation of negligence. MIRMA has stipulated that it was not prejudiced by the City’s fifty-one day delay in submitting the claim. The issues on appeal primarily concern whether MIRMA could lawfully deny the claim when it concedes no prejudice from the late submission. '

“Missouri courts have consistently placed the burden on insurers to demonstrate that they are prejudiced by receiving late notice of a claim before allowing the companies to avoid coverage under a policy because of the late notice.” Tresner v. State Farm Ins. Co., 913 S.W.2d 7, 11 (Mo. banc 1995). This “requirement that the insurer bear the burden of proving prejudice from late notice is a judicially-created exception to the rule expressed in Missouri Commercial Inv. Co. v. Employers Mut. Cas. Co., 680 S.W.2d 397, 400 (Mo.App.1984), that the insured bears the burden of showing compliance with the requisite policy conditions, including any notice provisions, in order to make a sub-missible case for recovery.” Id. at n. 3. See also MAI 32.24 (6th ed.2002) (affirmative defense instruction requiring insurer to prove violation of policy condition and resulting prejudice). The Supreme Court has explained the public policy underlying this exception:

The function of the notice requirements is simply to prevent the insurer from being prejudiced, not to provide a technical escape-hatch by .which to deny coverage in the absence of prejudice nor to evade the fundamental protective purpose of the insurance contract to assure the insured and the general public that liability claims will be paid up to the policy limits for which premiums were collected. Therefore, unless the insurer is actually prejudiced by the insured’s failure to give notice immediately, the insurer cannot defeat its liability under the policy because of the non-prejudicial failure of its insured to give immediate notice of an accident or claim as stipulated by a policy provision.

Weaver v. State Farm Mut. Auto. Ins. Co., 936 S.W.2d 818, 820 (Mo. banc 1997).

The circuit court granted summary judgment in Carroll’s favor, based on a determination that MIRMA provided insurance to the City and was, therefore, required to show prejudice before denying the claim as untimely. In Point I on appeal, MIRMA contends the court erred in concluding that it is an insurance company subject to the judicially-created prejudice requirement. MIRMA argues the prejudice exception is only applicable to traditional insurance companies organized under the insurance statutes in Chapter 379. MIRMA describes itself as a “self-insurance risk pool” organized under the sovereign immunity provisions of Section 537.620 to provide municipalities with an alternative to purchasing traditional insurance. MIRMA asserts Missouri courts have not applied the prejudice requirement to self-insurers and, thus, the circuit court erred in extending the exception to the facts of this case.

Contrary to these arguments, our courts have not limited the prejudice requirement to insurers organized under Chapter 379. In Geisner v. Budget Rent A Car of Missouri, 999 S.W.2d 265 (Mo.App.1999), Budget was self-insured on the first $250,000 loss incurred by the driver of a rental car. Id. at 266. Budget refused to pay a damage claim on grounds that it did not receive timely notice of a negligence action against the driver. Rejecting that defense, the Eastern District held:

An insurer must plead prejudice resulting from an insured’s failure to provide timely notice of a claim as an affirmative defense. Budget failed to plead prejudice resulting from Driver’s alleged failure to provide timely notice of Plaintiffs claims against her. Accordingly, whether Budget received timely notice of Plaintiffs claims was immaterial.

Id. at 267 (citations omitted).

Geisner indicates the prejudice requirement has been applied to an entity that acted as a self-insurer and was not organized as an insurance company under any Missouri statute. MIRMA seeks to distinguish Geisner on the ground that Budget’s role was tantamount to that of a traditional insurance company entering into a contract of adhesion with the driver of a vehicle. In contrast, MIRMA describes itself — -in Point II on appeal — as a “self-insurance risk pool” to which there is no need to apply the prejudice requirement because the members have equal bargaining power in determining the policies of the association. We note, however, that mutual insurance companies are subject to the prejudice requirement even though they operate in a manner similar to that described by MIRMA. See Weaver, 936 S.W.2d 818. Missouri courts have applied the prejudice exception whenever a business entity is contractually obligated to provide liability insurance, no matter how the entity is organized or operates under state or foreign law.

Faced with case law indicating that insurers of all organizational types must prove prejudice to avoid payment of a late claim, MIRMA argues alternatively that it does not provide insurance and does not operate as an insurance company based on disclaimers in its “Coverage Outline.” This assertion is contradicted by Section 537.620, which authorized the creation of MIRMA as a “business entity for the purpose of providing liability and all • other insurance” to political subdivisions. Consistent with this purpose, Carroll points out that MIRMA’s own website contains the following Mission Statement: “(MIR-MA) is an alliance of governmental entities committed to providing comprehensive, competitively-priced insurance and risk management services to its members.” (emphasis added). The website further states that MIRMA’s goal is to “[pjrovide a scope of insurance to protect MIRMA members.assets.” Despite any disclaimer in the Coverage Outline, MIRMA clearly markets itself as an insurance provider.

As the circuit court explained, MIRMA acts as an insurer given the nature of its relationship with its members and the legislative intent of the authorizing statute, Section 537.620:

An “insurer,” by definition, is one who issues “insurance.” “Insurance” is “coverage by contract whereby for a stipulated consideration one party undertakes to indemnify or guarantee another against loss by a specified contingency or peril.” Scott v. Labor and Indus. Relations Comm’n, 757 S.W.2d 635, 636 (Mo.Appt1988), quoting Webster’s Third New International Dictionary. See also, Black’s Law Dictionary, 5th Ed. (1979)(defining “insurance” as a “contract whereby one undertakes to indemnify another against loss, damage, or liability arising from an unknown or contingent event and is applicable only to some contingency or act to occur in the future,” and “insurer” as the “party agreeing to make the compensation.”)
Pursuant to its contract, the City of Stanberry paid MIRMA a stipulated consideration, in the form of assessments. In exchange for this consideration, MIRMA agreed ... to indemnify or guarantee the City of Stanberry against loss by specified contingencies, “including errors, omissions, misfeasance, malfeasance or non-feasance, for damages direct or consequential, and expenses defined by the ‘Ultimate Net Loss,’ on account of bodily injury or personal injury.” The contract between the City of Stanberry and MIRMA could hardly fit the definition of insurance more clearly....
This conclusion is consistent with the statutory scheme under which MIRMA is organized.... If the legislature had intended to delete the reference[s] to insurance, it could have easily done so. Rather than avoid references to insurance, however, the legislature made several specific uses of the term insurance, and made the entities thereby created subject to approval and regulation by the Department of Insurance.

The circuit court correctly applied the law in determining that MIRMA provides insurance to its members and is thereby subject to the prejudice requirement under Missouri common law. Points I and II are denied.

In Point III, MIRMA contends Carroll failed to state a cause of action for an equitable garnishment claim under Section 379.200 because that provision is only applicable to insurance companies, which MIRMA is not. In light of our finding that MIRMA provided insurance to its members and was authorized as an insurance entity under Missouri law, this point must be denied. We note further that Section 379.200 permits an equitable garnishment action against an “insurance company, person, firm or association[.]” The equitable relief is not limited to insurers organized under Chapter 379 and is expressly applicable to:

[E]very contract of insurance made between an insurance company ... or association, whether, stock, mutual, reciprocal or other company ... and any person, firm or corporation, by which such person, firm or corporation is insured against loss or damage on account of the bodily injury or death or damage to property by accident of any person[J

§ 379.195.1 (emphasis added). MIRMA’s agreement to provide liability coverage for the City of Stanberry falls well within this definitional provision. Accordingly, Carroll’s equitable garnishment petition stated a proper claim for relief against MIRMA.

Conclusion

Carroll established there was no genuine issue of fact on the equitable garnishment claim and that MIRMA’s affirmative defense of untimely notification failed as a matter of law. The circuit court properly granted summary judgment in Carroll’s favor. The judgment is affirmed.

Carroll’s Motion to Strike the Amici Brief of the Mid-America Regional Council Insurance Trust and the Missouri United School Insurance Council is denied.

All concur.

      . All statutory citations are to the Missouri Revised Statutes 2000, unless otherwise noted.

        . In their response to the summary judgment motion, MIRMA admitted all factual allegations except those related to the affirmative defense of untimely notification.

      . For purposes of this case, we need not and do not determine whether MIRMA’s characterization of itself as a "self-insurance risk pool" is correct. The application of the prejudice requirement depends upon whether MIRMA provided insurance to its members and not the management structure of the association. We note, however, that MIRMA's organizational structure does not appear to satisfy the key feature identifying self-insurers: retention of the risk of loss by the one upon whom it is imposed by law or contract. St. John’s Reg’l Health Ctr. v. Am. Cas. Co., 980 F.2d 1222, 1225 (8th Cir.1992). By legislative mandate, MIRMA is a separate "business entity” from which municipalities can purchase insurance in order to shift their losses. § 537.620.

      . MIRMA’s Coverage Outline states:
      The outline is not an insurance policy but is incorporated by reference as a section of the Association’s Second Revised By-Laws. The Articles of Association specifically prohibits the issuance of a policy of insurance by the association, as under the laws of the State of Missouri, only an insurance company has the authority to issue an insurance policy.


author: KENNETH W. SHRUM, Presiding Judge.

text:
    CBD ENTERPRISES, INC., Plaintiff-Respondent, v. BRACO MANUFACTURING, INC., Defendant-Appellant.
    No. 26843.
    Missouri Court of Appeals, Southern District, Division Two.
    Oct. 28, 2005.
    Application for Transfer Denied Nov. 21, 2005.
    Application for Transfer Denied Jan. 31, 2006.

      John W. Rourke, Charles R. Yantine, St. Louis, for appellant.
    John W. Grimm, Limbaugh, Russell, Payne & Howard, Cape Girardeau, for respondent.
   KENNETH W. SHRUM, Presiding Judge.

CBD Enterprises, Inc. (“Plaintiff’) obtained a default judgment against Braco Manufacturing, Inc. (“Defendant”) on a breach of contract claim. Defendant moved to set aside the judgment (per Rule 74.05(d)), alleging it had a meritorious defense to Plaintiffs claim and there was good cause to set aside the judgment. The motion was overruled and Defendant appeals, charging the trial court abused its discretion by not setting aside the judgment. This court agrees. We reverse and remand with directions.

On October 15, 2003, Plaintiff sued Defendant, claiming that Defendant breached its contract with Plaintiff by (a) refusing to manufacture diapers for Plaintiff according to original specifications, and (b) “re-fus[ing] to refund the purchase price to [Plaintiff].”

Defendant’s president, Jack Braha (“Braha”) was served with the suit documents and summons on December 9, 2003. However, Braha did .not hire a lawyer to answer.Plaintiffs suit at that point. Instead, he placed a call to Karen Turley (“Turley”), circuit court clerk of Mississippi County, Missouri, on January 5, 2004, and then faxed a letter to the circuit clerk on January 6, 2004. The letter, written on Defendant’s letterhead, was denominated “Reply to Summons and Petition.”

The two versions of what was said in the Braha to Turley telephone call on January 5, 2004, are as follows. In a post-judgment affidavit, Braha swore he asked Turley for “instructions on answering Plaintiffs Petition.” Continuing, Braha testified Turley “instructed me to respond, i.e., answer the allegations set forth by Plaintiff, but made no mention of the requirement that corporations'must appear by attorney.” Braha concluded this part of his affidavit as follows: “I told Clerk Turley that I would be answering Plaintiffs Petition via letter on behalf of [Defendant],” but “[h]ad I known that the corporation was required to appear through counsel, [Defendant] would have retained Missouri counsel.”

Turley’s affidavit (also part of the post-judgment filings) acknowledged talking with Braha on January 5. She testified:

“During our conversation, I told Mr. Braha that he needed to file an Answer to thé Petition. Further, I told him that he would need to get an attorney. Mr. Braha insisted that he did not want to go to the expense of hiring an attorney at that time. He stated that he wanted to file an Answer himself. I advised Mr. Braha that I would file-stamp and place in the Court file anything that he sent. I also told him that I did not know if that would be a legal response on behalf of his company.” (Paragraph numbers omitted.)

Braha’s January 6 letter was a two-page, single-spaced document directed to “Judge David Andrew Dolan, c/o Karen Turley.” It made reference to the style of the case, the case number, and recited that a copy had been sent to John Grimm (“Grimm”), Plaintiffs attorney. In the body thereof, Braha alleged he had talked with Grimm after he (Braha) had received the summons; that Grimm had then faxed documents to Braha which Grimm claimed supported Plaintiffs claims. Continuing, Braha’s letter recited that after looking at the documents received from Grimm, he decided “we are all looking at the same evidence [and] I will resubmit these same documents to support my answers below.” The balance of the letter alleged facts supportive of Defendant’s claim that it had not breached the contract.

A docket sheet entry on January 7, 2004, recited: “Answer Filed (copy mailed by Defendant to Plaintiffs attorney) Filed by BRACO MANUFACTURING INC.”

On February 10, 2004, Grimm filed a “Motion For Default Judgment” against Defendant, alleging that only a lawyer could have answered on Defendant’s behalf; that since Braha was not a lawyer, the letter filed by him did not qualify as a responsive pleading or answer; consequently, Defendant was in default. Accompanying the motion was an affidavit by Lucille R. Casell, which stated Plaintiff had damages totaling $68,897.76 because of Defendant’s breach of the contract. Neither Defendant nor Braha were notified of these filings nor were they notified in advance of Grimm’s court appearance on February 10, 2004. Judgment for $68,897.76 was entered against Defendant on that date.

On March 5, 2005, Defendant moved to set aside the judgment, relying upon Rule 74.05(d) as its basis. Both in its motion and Braha’s affidavit, Defendant set out facts that it claimed raised a meritorious defense and supported a “good cause shown” finding. Defendant’s motion was denied and this appeal followed.

Rule 74.05(d) applies specifically to default judgments and requires that a motion to set aside shall be for “good cause shown” which includes a mistake or conduct not intentionally designed to impede the judicial process. Billingsley v. Ford Motor Co., 939 S.W.2d 493, 497 (Mo.App.1997). Relief via this rule must be sought “within a reasonable time not to exceed one year after the entry of default judgment.” “Good cause includes a mistake or conduct that is not intentionally or recklessly designed to impede the judicial process.” Id.

Defendant’s first point relied on maintains, inter alia, that the trial court committed reversible error by not setting aside the default judgment because Defendant’s motion stated facts that established the good cause element of a Rule 74.05(d) case.

The applicable scope of appellate review is stated in Keltner v. Lawson, 931 S.W.2d 477 (Mo.App.1996):

“‘The trial court has discretion to set aside a default judgment, and its decision will not be interfered with unless an abuse of discretion is found. Bell v. Bell, 849 S.W.2d 194, 197 (Mo.App.1993); Moore v. Dahlberg, 810 S.W.2d 730, 732 (Mo.App.1991). The discretion not to set aside a default judgment, however, is a good deal narrower than the discretion to set one aside. LaRose v. Letterman, 890 S.W.2d [347] at 350 [Mo.App.1994]. Thus, appellate courts are more likely to reverse a judgment which fails to set aside a default judgment than one which grants that relief. Moore v. Dahlberg, 810 S.W.2d at 732. This is because of the law’s distaste for default judgments and its preference for trials on the merits. See LaRose v. Letterman, 890 S.W.2d at 350; Gibson v. Elley, 778 S.W.2d [851] at 854 [Mo.App.1989].’ ”

Id. at 479 (quoting Myers v. Pitney Bowes, Inc., 914 S.W.2d 835, 838 (Mo.App.1996)).

In adopting Rule 74.05(d), the Missouri Supreme Court “considerably broadened” the discretion of the trial court to forgive the mishandling of legal documents. Myers, 914 S.W.2d at 839[5]. Under the current version of this rule, “[w]here a reasonable doubt exists as to whether the conduct was intentionally designed or irresponsibly calculated to impede the work of courts, it should be resolved in favor of good faith.” Id. at 839.

This court has noted that although the good cause element of Rule 74.05(d) evades “ ‘precise definition,’ ” it “ ‘obviously intends a remedial purpose and is applied with discretion to prevent a manifest injustice or to avoid a threatened one.’ ” In re Marriage of Williams, 847 S.W.2d 896, 900 (Mo.App.1993) (quoting B L C(K) v. W W C, 568 S.W.2d 602, 605 (Mo.App.1978)).

“Good cause” under Rule 74.05 for failure to timely file an answer was addressed in Myers:

“‘The good cause requirement of Rule 74.05(d) is satisfied by proving that the party in default did not recklessly or intentionally impede the judicial process. Great S. Sav. & Loan Ass’n v. Wilburn, 887 S.W.2d 581, 584 (Mo.banc 1994); LaRose v. Letterman, 890 S.W.2d at 351; Plybon v. Benton, 806 S.W.2d 520, 524 (Mo.App. W.D.1991). While the pri- or version of Rule 74.05 was interpreted to mean that a defendant who negligently failed to file a timely answer should be denied relief, the amended rule clarified that ‘ “good faith mistakes do constitute good cause, and a default judgment can be vacated even if the movant has negligently failed to file a timely answer.” Newton v. Manley, 824 S.W.2d 522, 524 (Mo.App. S.D.1992) (quoting Laughrey, Judgments — The New Missouri Rule, J.Mo.Bar 11, 15 (Jan.-Feb. 1988)).”

914 S.W.2d at 839[6],

When analyzing the term “reckless” in the Rule 74.05(d) context, this court has looked to the dictionary definition: “ ‘[R]eckless’ is ‘lacking in caution: deliberately courting danger.’ WebsteR’s Third New INTERNATIONAL DICTIONARY, 1896 (1971).” Williams, 847 S.W.2d at 900. In Williams, we also impliedly recognized the applicability of the Restatement definition of “reckless” in a Rule 74.05 case:'

“ ‘Recklessness differs from negligence also in kind. A person is negligent, if his inadvertence, incompetence, unskill-fulness or failure to take precautions precludes him from adequately coping with a possible or probable future emergency.’ Restatement § 500, Comment g. To be reckless, a person makes a conscious choice of his course of action, ‘either with knowledge of the serious danger to others involved in it or with knowledge of the facts which would disclose the danger to any reasonable man.’ ”

Id. (quoting Gibson by Woodall v. Elley, 778 S.W.2d 851, 854 (Mo.App.1989) and Farm Bureau Town & Country Ins. Co. v. Turnbo, 740 S.W.2d 232, 235 (Mo.App.1987)).

Based on the facts of this case, the trial court’s implicit conclusion that Defendant failed to show good cause is erroneous. In so deciding, we examine Braha’s behavior and conduct.

After Braha received the summons and petition, he did not ignore the directive in the summons, i.e., that Defendant “file [its] pleading to the petition ... within 30 days after receiving the summons.” The uncon-troverted evidence is that he contacted Turley four days before a responsive pleading was due. His purpose was to get “instructions on answering Plaintiffs Petition.” Understandably, Turley was guarded in her response. However, the answers she gave Braha were, in part, couched in terms of what Braha should do, not what Braha should do for the corporation. For example, she told Braha that “he needed to file an [ajnswer to the [p]etition[ ]” and that “he would need to get an attorney.” (Emphasis supplied.) When Braha voiced his intent to file an answer himself, Tur-ley’s response was that she would “file-stamp and place in the file anything that [Braha] sent[,]” but cautioned that she “did not know if that would be a legal response on behalf of the company.”

Evidence of Turley’s comments to Braha may well have supported a finding of negligence, namely, that Braha did not adequately cope with the possibility of the case going into default when, in the face of Turley’s remarks, he did not check with a lawyer or otherwise determine if he could file an answer on behalf of Defendant. See Restatement, n. 2 above; see also Billingsley, 939 S.W.2d at 499; Williams, 847 S.W.2d at 900; Gibson, 778 S.W.2d at 854. This court does not agree, however, that such evidence, even when considered in light of Turley’s cautionary remark that she “did not know if [Braha’s letter] would be a legal response on behalf of the company!,]” supports a finding that Braha deliberately courted danger or consciously chose a course of action “either with knowledge of the serious danger to [Defendant] ... or with knowledge of ... facts which should disclose the danger to any reasonable man.” Nothing in Turley’s testimony can reasonably be interpreted as importing knowledge to Braha that a corporation can only appear in legal proceedings though an attorney and that filings by him on behalf of Plaintiff might be considered “untimely filed and null and void.” See Reed v. Labor and Indus. Relations Comm’n., 789 S.W.2d 19, 23 (Mo.banc 1990); Stamatiou v. El Greco Studios, Inc., 935 S.W.2d 701, 702 (Mo.App.1996). We are led to this view, in part, by what we earlier noted, i.e., Turley first talked with Braha in terms of what Braha should do, not what Braha should do for the corporation. Equally significant is Braha’s testimony — not directly controverted by Turley’s affidavit or any other evidence— that he did not know nor was he told by Turley that “corporations must appear by attorney.” The record is silent on whether Defendant had been in other litigation, and if so, whether Braha had ever been rebuffed or precluded from filing pleadings on behalf of Defendant.

In sum, there are no facts, either generally or peculiar to this case, that should have disclosed to Braha, when measured by the “reasonable man” standard, that a default judgment might occur if he, rather than a lawyer, answered Plaintiffs petition. Under the circumstances, reasonable doubt exists as to whether Braha’s filing an answer on behalf of Defendant was intentionally designed or irresponsibly calculated to impede the work of the courts. Consequently, the trial court should have resolved all doubts on this issue in favor of a finding of good faith. Billingsley, 939 S.W.2d at 498. We are persuaded Defendant did not impede the judicial process by reason of Braha’s behavior and that the trial court abused its discretion when it did not prevent a manifest injustice by setting aside the default judgment. See Wilburn, 887 S.W.2d at 584; Billingsley, 939 S.W.2d at 499; Williams, 847 S.W.2d at 900.

In so holding, we do not ignore cases cited by Plaintiff to support its argument for affirmance, i.e., Krugh v. Hannah, 126 S.W.3d 391 (Mo.banc 2004), and Snelling v. Roy’s Transmission, Inc., 144 S.W.3d 919 (Mo.App.2004). However, factual dissimilarities in the cases make them inapposite as support for Plaintiffs position. In Krugh, the court reversed a judgment that set aside a default because (a) there was uncontradicted evidence that four default judgments had been taken against the defaulting party or its registered agent in the three-year period before the subject case; (b) the plaintiffs lawyer gratuitously notified the defaulting party’s registered agent “on August 10 that [the defendant corporation] was already several weeks in default, [yet] she still waited another 13 days to contact the insurer[;]” and (c) defendant took absolutely no action to defend itself in the thirty-day period before default. 126 S.W.3d at 393. Those are not the facts here. This record has no evidence of previous disregard of the court system by Braha or Defendant; there was no warning of Defendant or Braha by Plaintiffs lawyer; and Defendant did take some action to defend itself, chiefly via the letter/answer filed on its behalf by Braha.

The Snelling court also reversed a judgment that set aside a default judgment, but did so because (a) the defaulting party did not verify its Rule 74.05(d) motion nor otherwise support it by affidavit or sworn testimony, and (b) the defaulting party “ ‘failed to notice’ that a responsive pleading was required, thereby admitting that [the party served] failed to read at least part of the summonses.” 144 S.W.3d at 921. The latter conduct was held to be conduct “recklessly designed to impede the judicial process.” Id. at 921[2]. Again, those are not the facts of this case.

For the reasons explained, we hold that Defendant presented facts sufficient to constitute good cause for its failure to appear and defend as required by Rule 74.05(d).

For the reasons given above, we conclude Defendant’s first point has merit. The trial court abused its discretion and erred in not setting aside this default judgment. The trial court’s judgment refusing to set aside the default judgment is reversed. The case is remanded and the trial court directed to set aside the default judgment and to fix a reasonable time in which' Defendant shall be permitted to file an answer.

GARRISON and BARNEY, JJ., concur.

      . During oral argument on appeal, Plaintiff conceded Defendant had a meritorious defense and that Defendant’s Rule 74.05(d) motion was timely filed. Consequently, the only issue on appeal is whether the trial court erred when it implicitly ruled Defendant had not proven the good cause element.

      . See Restatement of Torts (Second), § 500, cmt. g (1965).

      . As Point I is decided favorably to Defendant, we need not and do not address Defendant’s second point which made additional contentions as to why Defendant claimed the trial court erred in refusing to set aside the default judgment.


text:
    STATE of Missouri, Respondent, v. William M. DONNELLY, Appellant.
    No. WD 64512.
    Missouri Court of Appeals, Western District.
    Nov. 1, 2005.
    Motion for Rehearing and/or Transfer to Supreme Court Denied Dec. 20, 2005.
    Application for Transfer Denied Jan. 31, 2006.

      Kimberly A. Gale, Kansas City, for appellant.
    Jeremiah W. (Jay) Nixon, Atty. Gen., Jefferson City, Shaun Mackelprang and Daniel McPherson, Office of Attorney General, Jefferson City, for respondent.
    Before LISA WHITE HARDWICK, Presiding Judge, PATRICIA A. BRECKENRIDGE, Judge, and PAUL M. SPINDEN, Judge.
   ORDER

William M. Donnelly appeals the circuit court’s judgment convicting him of two counts of statutory sodomy in the first degree. We affirm. Rule 30.25(b).