Appeal and Error--appealability--Rule 54(b) certification--not a final judgment--appeal
dismissed
An appeal was dismissed where the trial court granted partial summary judgment on a
contract action and certified the matter for immediate appeal pursuant to N.C.G.S. § 1A-1, Rule
54(b), but the issue of damages remained to be determined. A Rule 54(b) certification is
effective to certify an otherwise interlocutory appeal only if the trial court has entered a final
judgment with regard to a party or a claim in a case involving multiple parties or claims. The
certification here was ineffective because the issue of damages remained to be determined.
Moreover, there was no danger of inconsistent verdicts and no substantial right will be affected
pending the trial court's consideration of the remaining issue.
Appeal by Mountaire defendants from judgment entered 26 May
1998 by Judge William H. Freeman in Guilford County Superior
Court. Heard in the Court of Appeals 29 April 1999.
Smith Helms Mulliss & Moore, L.L.P., by Larry B. Sitton and
Manning A. Connors, for plaintiff-appellee.
Jordan, Price, Wall, Gray & Jones, L.L.P., by Henry W.
Jones, Jr. and Laura J. Wetsch; and Brooks, Pierce,
McLendon, Humphrey & Leonard, L.L.P., by James T. Williams,
Jr. and S. Kyle Woosley, for Mountaire defendants-
appellants.
WALKER, Judge.
Plaintiff CBP Resources, Inc. (CBP) filed this action on 12
December 1996, alleging breach of contract against Mountaire
Farms of North Carolina, Inc., Mountaire Corporation, Mountaire
Farms of Delmarva, Inc., Mountaire Feeds, Inc., and Piedmont
Poultry Processing, Inc. f/k/a Lumbee Farms Cooperative, Inc. CBP later amended its complaint to include defendants Mountaire
Farms, L.L.C., Piedmont Poultry Company, Inc., Piedmont Feed
Mills, Inc., Piedmont Poultry Farms, Inc., and Piedmont
Hatcheries, Inc. The Mountaire defendants filed a joint answer
to the amended complaint. The Piedmont defendants have not filed
any pleading and have not made an appearance in this matter.
CBP's claims arise from a contract made 29 January 1988
between CBP and Lumbee Farms Cooperative in which Lumbee agreed
to sell the by-products of its poultry processing operations at
its plant in Lumber Bridge, North Carolina to CBP. Lumbee was
subsequently purchased by the Piedmont defendants which assumed
the contract with CBP. In January 1996, Mountaire Farms of North
Carolina, Inc. entered into an asset purchase agreement with the
Piedmont defendants wherein it agreed to purchase certain assets
including the Lumber Bridge plant. CBP alleges that Mountaire is
bound by the contract to sell its poultry by-products to CBP.
Mountaire contends that it did not expressly or impliedly assume
the contract in the asset purchase agreement.
CBP filed a motion for partial summary judgment on the issue
of liability, which was heard by the trial court on 7 May 1998.
The trial court granted partial summary judgment for CBP and
noted the following in its order:
The Plaintiff's claims and the
Defendants' affirmative defenses are so
intertwined with the question of damages that
a fair adjudication of these issues cannot be
had without a contemporaneous presentment of
the other, so that the substantial rights of
these Defendants are affected, and immediate
appeal pursuant to N.C. Gen. Stat. § 1-277 is
warranted.
There is no just reason to delay appeal
of this matter, and this matter is therefore
certified for immediate appeal pursuant to
Rule 54(b); . . . .
We must first consider the issue of whether this appeal is
properly before the Court. See Bailey v. Gooding, 301 N.C. 205,
270 S.E.2d 431 (1980). The trial court granted partial summary
judgment for the plaintiff only on the issue of liability. “A
grant of partial summary judgment, because it does not completely
dispose of the case, is an interlocutory order from which there
is ordinarily no right of appeal.” Liggett Group v. Sunas, 113
N.C. App. 19, 23, 437 S.E.2d 674, 677 (1993). “An order or
judgment is interlocutory if it is made during the pendency of an
action and does not dispose of the case but requires further
action by the trial court in order to finally determine the
entire controversy.” N.C. Dept. of Transportation v. Page, 119
N.C. App. 730, 733, 460 S.E.2d 332, 334 (1995). The rule against
interlocutory appeals seeks to prevent fragmentary, premature and
unnecessary appeals by allowing the trial court to bring a case
to final judgment before its presentation to the appellate
courts. Waters v. Personnel, Inc., 294 N.C. 200, 240 S.E.2d 338
(1978). There are only two means by which an interlocutory order
may be appealed: (1) if the order is final as to some but not all
of the claims or parties and the trial court certifies there is
no just reason to delay the appeal pursuant to N.C.R. Civ. P.
54(b) or (2) “if the trial court's decision deprives the
appellant of a substantial right which would be lost absent
immediate review.” Bartlett v. Jacobs, 124 N.C. App. 521, 523,
477 S.E.2d 693, 695 (1996), disc. review denied, 345 N.C. 340,483 S.E.2d 161 (1997)(citations omitted); N.C. Gen. Stat. § 1-277
(1996); N.C. Gen. Stat. § 7A-27 (1995).
However, a Rule 54(b) certification is effective to certify
an otherwise interlocutory appeal only if the trial court has
entered a final judgment with regard to a party or a claim in a
case which involves multiple parties or multiple claims. See DKH
Corp. v. Rankin-Patterson Oil Co., 348 N.C. 583, 500 S.E.2d 666
(1998). Rule 54(b) certification of an appeal is reviewable by
this Court “because the trial court's denomination of its decree
'a final . . . judgment does not make it so,' if it is not such a
judgment.” First Atlantic Management Corp. v. Dunlea Realty Co.,
131 N.C. App. 242, 247, 507 S.E.2d 56, 60 (1998)(quoting
Industries, Inc. v. Insurance Co., 296 N.C. 486, 491, 251 S.E.2d
443, 447 (1979)) (citations omitted). Thus, we must determine
whether the partial summary judgment entered in favor of CBP was
final or, in the alternative, whether a substantial right of the
defendants will be affected absent immediate appellate review.
“A final judgment is one which disposes of the cause as to
all the parties, leaving nothing to be judicially determined
between them in the trial court.” Veazey v. City of Durham, 231
N.C. 357, 361-62, 57 S.E.2d 377, 381, rehearing denied, 232 N.C.
744, 59 S.E.2d 429 (1950). In this case, plaintiffs moved for
summary judgment on the issue of liability; however, plaintiff's
counsel admitted at the motion hearing that there were issues of
material fact regarding damages which made it unsuitable for
summary judgment. Because the issue of damages remains to be
determined by the trial court, this is not a final judgment andthe trial court's Rule 54(b) certification is ineffective. See,
e.g., Cagle v. Teachy, 111 N.C. App. 244, 431 S.E.2d 801 (1993);
McNeil v. Hicks, 111 N.C. App. 262, 431 S.E.2d 868 (1993), disc.
review denied, 335 N.C. 557, 441 S.E.2d 118 (1994).
Next, we determine whether a substantial right would be
affected. The substantial right test is more easily stated than
applied, and it is usually necessary to consider the facts and
circumstances of each case along with its procedural context to
apply the test. Green v. Duke Power Co., 305 N.C. 603, 290
S.E.2d 593 (1982). The test is satisfied when overlapping issues
of fact between decided claims and those remaining create the
possibility of inconsistent verdicts from separate trials. Id.;
Davidson v. Knauff Ins. Agency, 93 N.C. App. 20, 26, 376 S.E.2d
488, 492, disc. review denied, 324 N.C. 577, 381 S.E.2d 772
(1989).
Here, as the issue of liability has been determined, the
only remaining issue is that of damages and there is no danger of
inconsistent verdicts. See, e.g., Industries, Inc., 296 N.C.
486, 251 S.E.2d 443; McNeil, 111 N.C. App. 262, 431 S.E.2d 868.
Therefore, no substantial right will be affected pending the
trial court's consideration of the remaining issue.
Furthermore, this case is distinguishable from both Bartlett
and DKH Corp. In Bartlett, a substantial right--the possibility
of inconsistent verdicts--was affected because the plaintiff's
claim and defendant's counterclaim were “sufficiently intertwined
so that 'a fair adjudication of one claim cannot be had without a
contemporaneous presentment of the other.'” Bartlett, 124 N.C.App. at 524, 477 S.E.2d at 695-96. In this case, there is no
counterclaim which remains to be determined. The only issue
remaining is that of damages. In DKH Corp., our Supreme Court
interpreted Rule 54(b) noting it applies to cases which involve
multiple claims or multiple parties. DKH Corp., 348 N.C. at 585,
500 S.E.2d at 667. Here, there is but a single claim asserted
against parties with interests so similar that they filed joint
pleadings. Further, the judgment is not final as to any claims
or parties.
In certifying the appeal, the trial court stated that
plaintiff's claims and defendants' affirmative defenses were
intertwined with the damages issue. However, we do not perceive
this to be an impediment in a trial on the issue of damages.
For these reasons, this appeal is dismissed and the case is
remanded to the trial court for further proceedings.
Dismissed and remanded.
Judges WYNN and HUNTER concur.
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