Appeal and Error--appealability-interlocutory order--certification erroneous
The trial court's attempt to grant Rule 54(b) certification based on its order compelling
arbitration and denying defendant's motion for summary judgment fails because the order is not a
final judgment, and defendant has not shown the order deprives it of a substantial right.
Chandler, deBrun, Fink & Hayes, by Andrew Fink, for plaintiff-
appellee.
Kennedy, Covington, Lobdell & Hickman, L.L.P., by Wayne P.
Huckel and Christopher L. Ekman, for defendant-appellant.
JOHN, Judge.
Defendant State Farm Insurance Company purports to appeal the
trial court's order compelling arbitration and denying defendant's
motion for summary judgment. Defendant's appeal is interlocutory
and must be dismissed.
In view of our disposition, lengthy exposition of the
underlying facts is unnecessary. We note plaintiff Raymond B.
Russell was injured in a motor vehicle accident (the accident) 6
September 1995 while operating a motorcycle insured by defendant
under a policy containing uninsured motorist coverage (the policy).
Plaintiff maintains the accident was caused by a second,
unidentified vehicle which fled the scene, while defendant contends
plaintiff “slid in loose gravel . . . and was involved in a single
vehicle accident.” Plaintiff subsequently notified defendant of the accident and
his resultant personal injury, requesting compensation under Part
C of the policy, “Uninsured Motorists Coverage,” which dealt with
collisions caused, inter alia, by “a hit and run vehicle.” The
policy provided that
[a] person seeking Uninsured Motorists
Coverage must . . . :
1. Promptly notify police if a hit and run
driver is involved.
Plaintiff concedes he
did not report this accident to a police
officer because following the accident he was
taken immediately from the scene to the
hospital where he spent some time due to the
injuries sustained.
Defendant denied coverage 14 March 1997.
Plaintiff thereafter requested arbitration pursuant to the
following provision of the policy:
If we and an insured do not agree:
1. Whether that person is legally entitled
to recover compensatory damages from the owner
or driver of an uninsured motor vehicle; or
2. As to the amount of such damages;
the insured may demand to settle the dispute
by arbitration.
However, defendant rejected plaintiff's request for
arbitration, and plaintiff filed the instant declaratory judgment
action 16 February 1998, praying that the trial court “remov[e]this action to binding arbitration.” In its answer, defendant
asserted that
plaintiff must commence a civil action against
[defendant] to determine whether there is
uninsured motorist coverage before it can
resort to the arbitration provision,
and that plaintiff's failure to notify police of the accident
violated provisions of the policy which constituted “a condition
precedent to making an uninsured motorists claim” against
defendant.
Defendant moved for summary judgment 6 January 1999. The
trial court rendered its decision 4 March 1999, ordering
that all issues raised herein shall be
referred to arbitration . . . with the parties
having the right to have a judgment upon any
arbitration award entered in any court having
jurisdiction. . . .
. . . [P]laintiff's failure to report his
accident to a law enforcement officer does not
and will not bar his uninsured motorist claim
against defendant and, therefore, defendant's
motion for summary judgment is denied as a
matter of law.
These decisions constitute a final
judgment as to the issues of arbitrability and
the continued viability of plaintiff's
uninsured motorist claim and there is no just
cause or reason for delaying any appeal
herefrom under Rule 54 of the North Carolina
Rules of Civil Procedure.
Defendant timely appealed.
Although not raised by the parties, we are obliged first to
consider sua sponte whether defendant's appeal is properly before
this Court. See First Atl. Mgmt. Corp. v. Dunlea Realty Co., 131
N.C. App. 242, 246, 507 S.E.2d 56, 59 (1998). An order of the
trial court is interlocutory if it is made during the
pendency of an action and does not dispose ofthe case but requires further action . . . in
order to finally determine the entire
controversy. There is generally no right to
appeal an interlocutory order.
Howerton v. Grace Hospital, Inc., 124 N.C. App. 199, 201, 476
S.E.2d 440, 442 (1996) (citation omitted). The rule prohibiting
interlocutory appeals
prevent[s] fragmentary, premature and
unnecessary appeals by permitting the trial
court to bring the case to final judgment
before it is presented to the appellate
courts.
Fraser v. Di Santi, 75 N.C. App. 654, 655, 331 S.E.2d 217, 218,
disc. review denied, 315 N.C. 183, 337 S.E.2d 856 (1985).
An order compelling arbitration and denying a motion for
summary judgment, such as that entered in the instant case, is
interlocutory and therefore not immediately appealable. See The
Bluffs v. Wysocki, 68 N.C. App. 284, 285, 314 S.E.2d 291, 293
(1984) (order compelling arbitration interlocutory); Cagle v.
Teachy, 111 N.C. App. 244, 247, 431 S.E.2d 801, 803 (1993) (order
denying motion for summary judgment interlocutory).
Notwithstanding, interlocutory orders may be appealed in two
instances:
First, a party may appeal where the trial
court enters a final judgment with respect to
one or more, but less than all of the parties
or claims, and the court certifies the
judgment as immediately appealable under Rule
54(b) of the North Carolina Rules of Civil
Procedure [N.C.G.S. § 1A-1, Rule 54(b)
(1999)].Romig v. Jefferson-Pilot Life Ins. Co., 132 N.C. App. 682, 685, 513
S.E.2d 598, 600, disc. review denied, cert. denied, 350 N.C. 836,
___ S.E.2d ___ (1999). A party may also appeal an interlocutory
order "if it affects a substantial right and will work injury to
the appellants if not corrected before final judgment." Perry v.
Cullipher, 69 N.C. App. 761, 762, 318 S.E.2d 354, 356 (1984).
Significantly, in either instance,
it is the appellant's burden to present
appropriate grounds for this Court's
acceptance of an interlocutory appeal . . . .
Jeffreys v. Raleigh Oaks Joint Venture, 115 N.C. App. 377, 379, 444
S.E.2d 252, 253 (1994).
The trial court in the instant case attempted to certify
defendant's appeal pursuant to Rule 54(b).
Rule 54(b) certification by the trial court is
reviewable by this Court on appeal in the
first instance 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 Atl., 131 N.C. App. at 247, 507 S.E.2d at 60 (citing
Industries, Inc. v. Insurance Co., 296 N.C. 486, 491, 251 S.E.2d
443, 447 (1979)).
Notwithstanding the trial court's characterization, its order
compelling arbitration and denying defendant's motion for summary
judgment cannot be classified a final judgment.
A final judgment is one which disposes of the
cause as to all the parties, leaving nothing
to be determined between them . . . .
Cagle, 111 N.C. App. at 246-47, 431 S.E.2d at 803. An order
compelling arbitration is not a final judgment, as by its terms it“fails to resolve all issues between all parties,” First At
l., 131
N.C. App. at 246, 507 S.E.2d at 60, but rather refers such issues
to arbitration to be resolved. Similarly,
denial of a motion for summary judgment is not
a final judgment . . . even if the trial court
has attempted to certify it for appeal under
Rule 54(b).
Cagle, 111 N.C. App. at 247, 431 S.E.2d at 803. Accordingly, the
trial court's order compelling arbitration and denying defendant's
motion for summary judgment “did not constitute a 'final' judgment
and is . . . not appealable pursuant to Rule 54(b).” Id.
As the first avenue of appeal of an interlocutory order was
foreclosed, defendant likewise
did not . . . have a right to appeal the order
in this case unless the order affected a
substantial right that would work injury to
[defendant] if not corrected before appeal
from final judgment.
Jeffreys, 115 N.C. App. at 379, 444 S.E.2d at 253-54; see also
First Atl., 131 N.C. App. at 247, 507 S.E.2d at 60 (denial of
motion for summary judgment not appealable unless substantial right
prejudiced); N.C. Electric Membership Corp. v. Duke Power Co., 95
N.C. App. 123, 127, 381 S.E.2d 896, 899 (order compelling
arbitration not appealable unless substantial right affected),
disc. review denied, 325 N.C. 709, 388 S.E.2d 461 (1989).
Defendant herein has
presented neither argument nor citation to
show this Court that [it] had the right to
appeal the [trial court's] order . . . . It
is not the duty of this Court to construct
arguments for or find support for appellant's
right to appeal from an interlocutory order;
instead, the appellant has the burden ofshowing this Court that the order deprives the
appellant of a substantial right. . . .
Jeffreys, 115 N.C. App. at 380, 444 S.E.2d at 254.
Based on the precedent cited above, therefore, defendant's
appeal must be dismissed.
Appeal dismissed.
Judges MCGEE and HUNTER concur.
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