Friday, October 4, 2013
State Supreme Court Takes Strict View of ‘One Judgment’ Rule
Court Says Order Is Not Appealable Where Unresolved Claims Dismissed to Be Litigated Later
By KENNETH OFGANG, Staff Writer
Parties to a suit in which only some of the causes of action have been adjudicated may not create appellate jurisdiction by agreeing that the remaining claims will be dismissed without prejudice and with a waiver of the statute of limitations, the state Supreme Court unanimously ruled yesterday.
Overturning a contrary ruling by Div. Five of this district’s Court of Appeal, the justices ordered dismissal of an ophthalmologist’s appeal from a judgment entered in favor of his former partner. The high court said the judgment was not appealable, under Code of Civil Procedure Sec. 904.1’s “one final judgment” rule, because there was no final adjudication of claims by each party that he was defamed by the other.
The plaintiff, Dr. Badrudin Kurwa of Arcadia, formed a corporation with Dr. Mark Kislinger in order to provide services to patients of a health maintenance organization. Several years later, however, Kurwa’s license was suspended and Kislinger notified the HMO that Kurwa was no longer part of the practice and that he would be serving its patients through his own corporation.
The HMO executed a new agreement with Kislinger, excluding Kurwa, who sued for breach of fiduciary and defamation, among other things. Kislinger cross-complained for defamation.
Trial Court Ruling
Ruling on the defendant’s pretrial motions, Los Angeles Superior Court Judge Dan T. Oki ruled that the parties did not owe each other any fiduciary duties. As a result, the plaintiff conceded that he could not proceed with any of his claims, except for defamation.
The parties then agreed that judgment would be entered for defendant on the non-defamation claims, in anticipation of plaintiff’s appeal, while the defamation claims would be dismissed without prejudice and with the intent that they be preserved “for such time as this case may come back from appeal,” the plaintiff’s lawyer told the judge.
On that appeal, the court held the judgment final and appealable, saying the dismissal without prejudice left the trial court with no jurisdiction over the defamation claims. In an opinion by since-retired Justice Orville Armstrong, the court acknowledged a line of contrary Court of Appeal decisions, but said those panels had taken an overly broad interpretation of what makes a cause of action “pending.”
He concluded that “[w]hile a cause of action which has been dismissed may be pending ‘in the appellate netherworld,’ it is not pending in the trial court, or in any other court, and thus cannot fairly be described as ‘legally alive.’”
On the merits, the Court of Appeal ruled that Kurwa had pled a cause of action for breach of fiduciary duty, and reversed. Justice Richard Mosk concurred in the opinion, while Justice Sandy Kriegler argued in dissent that the court lacked jurisdiction.
Justice Kathryn M. Werdegar yesterday sided with Kriegler, saying the cases rejected by the lower panel were correctly decided.
She cited Morehart v. County of Santa Barbara (1994) 7 Cal.4th 725, which held that a judgment on fewer than all causes of action was interlocutory, and generally non-appealable, where the remaining causes of action had been severed for separate trial. The aggrieved party, in that situation, could seek review by writ of mandate, the court said.
A strict “one final judgment” rule, Werdegar said, not only reduces the number of appeals, it avoids “uncertainty and delay” in trial courts and avoids unnecessary appeals on issues that might be resolved in the trial court while it still has jurisdiction. The rule should therefore be the same, she said, whether or not the parties are willing to stipulate that further litigation will take place only if the judgment is reversed.
The justice acknowledged the view of the California Academy of Appellate Lawyers, which argued in an amicus brief that parties “should not be forced needlessly to try claims simply to obtain an appealable judgment.” But Werdegar said the court was “not free…to adopt whatever rule we find best balances the interests of party autonomy or trial and appellate efficiency.”
She contrasted Sec. 904.1 with federal rules and statutes, writing:
“Unlike jurisdictions that provide for trial courts’ selective entry of final judgments on fewer than all claims for relief…or for interlocutory appeals in the discretion of the reviewing court…California law provides no case-by-case efficiency exception to the one final judgment rule for appealability. Where unusual circumstances justify it, review of interlocutory judgments may be obtained by petition for writ of mandate, but not by appeal….The question is thus not what rule will best serve litigants and trial courts, but what rule is most consistent with the policy against piecemeal appeals codified in section 904.1 and vindicated in Morehart.”
The case was argued on appeal by Robert S. Gerstein for the plaintiff and by Dale B. Goldfarb of Harrington, Foxx, Dubrow & Canter for the defendant.
The case is Kurwa v. Kislinger, 13 S.O.S. 5112.
Copyright 2013, Metropolitan News Company