## Facts

- Melvin James Sprung, Jr. sued Negwer Materials, Inc. for personal injuries allegedly caused when a rented cart tipped over and drywall fell on him.
- Negwer was personally served and forwarded the suit papers to its insurer, which forwarded them to defense counsel.
- Defense counsel asserted that an entry of appearance and request for an extension were prepared and mailed, but neither the court clerk nor Sprung’s counsel received them.
- The court entered an interlocutory default, then a final default judgment for $1,500,000 against Negwer.
- After judgment, defense counsel (apparently unaware of the default) sent an answer and discovery to Sprung’s counsel; Sprung’s counsel, knowing of the default, did not promptly disclose the judgment and allowed the period for direct post-judgment relief to expire.
- Negwer filed an independent action in equity to set aside the default judgment; the trial court denied relief, and the denial was affirmed on appeal.

## Issues

1. Whether Negwer showed a sufficient “good reason or excuse” (fraud, accident, or mistake) to justify equitable relief from the default judgment.
2. Whether plaintiff’s counsel’s failure to inform the defense of the default judgment required the judgment to be set aside as fraud in its procurement.
3. Whether imputing the negligence of Negwer’s insurer and attorneys to Negwer violated due process.
4. Whether Sprung’s petition failed to state a cause of action such that the default judgment could not stand.

## Decision

- The Supreme Court of Missouri affirmed the denial of Negwer’s equitable petition to set aside the default judgment.
- Negwer failed to prove fraud, accident, or mistake of the type required for equitable vacation of a judgment.
- Negwer was bound by the neglect and failures of its insurer and attorneys; those omissions did not supply an equitable basis for relief.
- Plaintiff’s counsel’s deliberate silence about the default, without affirmative deception, did not constitute extrinsic fraud in the procurement of the judgment.
- The court rejected Negwer’s due process argument and held the petition sufficiently alleged a cognizable personal-injury claim.

## Legal Principles

- Equitable relief from a judgment requires a strong showing of extrinsic fraud, accident, or mistake that prevented a fair adversarial proceeding; it is not a substitute for ordinary post-judgment remedies.
- Negligence, carelessness, or office failure by a party, its insurer, or its attorneys ordinarily does not warrant setting aside a default judgment in equity.
- A client is generally bound by the acts and omissions of its attorneys and agents, including an insurer handling the defense.
- Opposing counsel has no general duty to alert the other side to a default judgment in time to pursue routine relief absent affirmative misrepresentation or conduct amounting to extrinsic fraud.
- Due process is satisfied where the defendant is properly served and has an opportunity to appear; the consequences of the defendant’s agents’ neglect do not, by themselves, create a constitutional violation.

## Conclusion

The court left the $1.5 million default judgment intact, holding that defense-side neglect and plaintiff’s counsel’s non-disclosure did not amount to extrinsic fraud, accident, or mistake sufficient to justify equitable vacation of the judgment, and that the defendant remained bound by its insurer’s and attorneys’ omissions.


Sprung v. Negwer Materials, Inc., 775 S.W.2d 97 (Mo. 1989)