Case Title: Mitzel v. Schatz

Citation: 167 N.W.2d 519

Docket Number: 

State: north-dakota

Court: North Dakota Supreme Court

Date: 1968-12-10T00:00:00Z

Document:
167 N.W.2d 519 (1968) Simon MITZEL, Plaintiff and Respondent, v. Kasper SCHATZ, Defendant and Appellant. No. 8510. Supreme Court of North Dakota. December 10, 1968. *520 Nilles, Oehlert, Hansen, Selbo & Magill, Fargo, for defendant and appellant. Vogel, Bair & Graff, Mandan, for respondent and movant. *521 ERICKSTAD, Judge. By summons and complaint dated February 22, 1967, Simon Mitzel initiated an action against Kasper Schatz in which he sought to recover for personal injuries allegedly suffered in an intersectional accident which occurred on November 15, 1965, on a county road 1½ miles east of Zeeland in McIntosh County. The complaint asserted that Mr. Mitzel's injuries were the result of the negligent operation of a motor vehicle by Mr. Schatz. Mr. Schatz responded by answer dated March 17, 1967, and amended answer dated November 15, 1967. He admitted that a two-car accident occurred on the date and at the place alleged in the complaint but specifically denied that he was in any way negligent in the operation of his automobile. He further alleged that the accident was caused wholly by the negligence of Simon Mitzel and his son Richard. For a separate defense he alleged that on November 18, 1965, for valuable consideration Simon Mitzel released him and others from "any and all known and unknown actions, causes of action, claims, demands, damages, costs, loss of services, expenses, compensation, rights of contribution and all consequent damages on account or in any way growing out of any and all known and unknown personal injuries and property damage and death resulting or to result from an accident that occurred on or about the 15th day of November, 1965, near Zeeland, North Dakota"; and that by virtue of said release, Simon Mitzel no longer had a cause of action against him. Mr. Mitzel anticipated this defense by including in his complaint an allegation that the release given was in settlement only of the property damage to his automobile. He further asserted: "that if the Defendant alleges, or if it is hereafter established, that any part of said settlement was for personal injuries received in said accident, the Plaintiff hereby rescinds said settlement upon the ground that said release was given by mistake in that the Plaintiff was not aware that he had suffered any serious personal injury in said accident and was specifically not aware that he had suffered brain damage as a result of said accident, and further that said release was obtained by fraud, and the Plaintiff hereby offers to restore any and all things of value received from defendant as fully and completely as if said release had never been given." Following a hearing on a motion to sever the issue of whether the release given precluded Simon Mitzel from recovering from Mr. Schatz for his personal injuries, the court granted said motion and set that issue down for separate trial to the court without a jury. Following that trial the court concluded that the release which was executed by Mr. Mitzel on November 18, 1965, was executed under a mistake of fact in respect to the personal injuries that Mr. Mitzel had sustained as a result of the automobile accident. It held that Mr. Mitzel was entitled to have judgment rescinding the release in respect to the settlement of the personal injury claim and that the release was not a bar to the instant action for damages for personal injuries. Pursuant to the findings of fact, conclusions of law, and order for judgment dated March 5, 1968, judgment dated March 13, 1968, was entered. By notice dated April 17, 1968, Mr. Schatz appealed. Following the service of this notice upon him, Mr. Mitzel made a motion in this court for a dismissal of the appeal on the following grounds: (1) The judgment of the district court is interlocutory in nature and does not adjudicate all of the rights and claims of the parties in the pending action; and (2) The judgment does not comply with the provisions of N.D.R.Civ.P. 54(b). Following service of this motion upon him, Mr. Schatz moved the court ex parte, citing N.D.R.Civ.P. 60, for an order nunc pro tunc correcting the conclusions of law, order for judgment, and judgment dated March 13, 1968, to provide, pursuant to N.D.R.Civ.P. *522 54(b), that there was no just reason for delay and to expressly direct the entry of judgment. The court granted this motion, and in its order of September 28, 1968, expressly determined that there was no just reason for delay and directed the entry of judgment to be effective as of the date of the original judgment. A document entitled "Judgment on Separate Trial" identical to the original judgment was thereafter executed on September 30, 1968, by the Clerk of the District Court of McIntosh County. We note from the affidavit filed in support of the motion to sever that the motion was based primarily on N.D.R.Civ.P. 21 and 42(b). We quote the pertinent part of the affidavit: Barron & Holtzoff contains an interesting commentary on rules 21 and 42(b): *523 In granting the motion in the instant case the trial court said: "[A]ll of the issues relative to the release raised by the pleadings are hereby severed and set down for separate trial to the court without a jury * * *." In his brief resisting the motion Mr. Mitzel argued as one of the reasons for not granting the motion that the granting of such a motion would result in separate appeals to the Supreme Court. We quote a part of the brief filed with the trial court: Notwithstanding that argument, Mr. Mitzel now contends that the judgment entered on March 13 was merely interlocutory and thus in essence a nonappealable order. In support of his contention he refers us to Ontjes v. McNider, 224 Iowa 115, 275 N.W. 328 (1937). That case was decided by the Supreme Court of Iowa before the adoption by that court or by our court of rules of civil procedure patterned on the federal rules. Further, apparently, in support of his view that the judgment in the instant case is in effect only a nonappealable order and that nonappealable orders are reviewable on appeal from the judgment, Mr. Mitzel refers us to Nordenstrom v. Swedberg, 123 N.W.2d 285 (N.D.1963); City of Minot v. Minot Highway Center, Inc., 120 N.W.2d 597 (N.D.1963); and Burdick v. Mann, 59 N.D. 611, 231 N.W. 545 (1930). A review of those decisions indicates that none of them involves an appeal from either an order or a judgment resulting from the separate trial of an issue in the case. Mr. Schatz contends that the judgment of March 13 is in effect an order which involves the merits of the action or some part thereof, and that it is therefore appealable under N.D.C.C. § 28-27-02(5), which reads: North Dakota Century Code. He refers the court to a decision rendered by the Supreme Court of Minnesota in 1944, holding that an order vacating a previous order approving the settlement of an infant's tort claim on the ground of mutual mistake of facts as to the nature and seriousness of the injuries is appealable. Elsen v. State Farmers Mut. Ins. Co., 217 Minn. 564, 14 N.W.2d 859 (1944). In Elsen the Minnesota court quoted an earlier decision, saying: The court relied for its holding upon the provisions of Minn.Stat.1941 § 605.09, Mason Stat. 1927 § 9498, subsections 3 and 7, which are almost identical to subsections 5 and 2 of N.D.C.C. § 28-27-02. However, in light of the fact that North Dakota has adopted the North Dakota Rules of Civil Procedure, patterned on the *524 federal rules, since the Iowa decision of Ontjes v. McNider, supra, relied on by Mr. Mitzel, and the Minnesota decision of Elsen v. State Farmers Mut. Ins. Co., supra, relied on by Mr. Schatz, we must consider whether those rules are pertinent to the determination of the issue of the appealability of the judgment in the instant case. Rule 54(a) states that a judgment includes a decree and any order from which an appeal lies. This rule superseded N.D.R.C.1943 § 28-0901, which defined a judgment as the final determination of the rights of the parties in an action. Notwithstanding that § 28-0901 was superseded and that our rules of civil procedure do not define a decree, we are convinced that only those judgments and decrees which constitute a final determination of the rights of the parties to the action and those orders enumerated in N.D.C.C. § 28-27-02 are appealable. The right to appeal from a state district court order to the state supreme court is governed by statute (N.D.C.C. § 28-27-02); the right to appeal from federal district court decisions to the federal courts of appeals is governed by statute (28 U.S.C.A. § 1291). Section 1291 reads: Although the United States Supreme Court acknowledged that appeal was governed by statute, it also recognized the pertinence of rule 54(b) in a decision in which the appealability of a judgment based on an adjudication of fewer than all the claims was considered: The Harvard Law Review in 1961 set forth the argument of the petitioners and the court's reasoning in rejecting it in Sears as follows: Applying similar reasoning, since we may judicially construe the concept of finality of judgments and may judicially determine whether orders involve the merits of an action, it is proper to do so by rule. The question arises whether rule 54(b) may be said to control the appealability of a judgment based upon an order which directed entry of judgment upon the adjudication of one but fewer than all of the issues. Rule 54(b) reads: Justice Burton, speaking for the majority in Sears, used language which some might contend restricts applicability of rule 54(b) to claims as distinguished from issues. Sears, Roebuck & Co. v. Mackey, supra, 76 S. Ct. 895, 899. It is our view, however, that the Supreme Court in rule 54(b) intended to make no distinction between claims and issues. Rule 42(b) permits the trial court to order a separate trial of claims and issues and also permits the court to direct a final judgment in accordance with the provisions of rule 54(b). Although rule 54(b) does not mention issues but speaks merely of claims, we think that the term claims is used in the general sense so as to include issues. We believe this to be a reasonable construction of the rule in light of the difficulty that would be presented by having one rule for claims and another for issues, especially when they could conceivably often be indistinguishable. This we say in spite of the fact that a writer for the Minnesota Law Review apparently had no difficulty in classifying the cases involving trials of separate claims from those involving trials of separate issues. See Notes, Separate Trial of a Claim or Issue in Modern Pleading: Rule 42(b) of the Federal Rules of Civil Procedure, 39 Minn.L.Rev. 743 (1955). The article did not cover the appealability of judgments adjudicating fewer than all claims or fewer than all issues. Having decided that rule 54(b) relates to issues as well as to claims, we think it proper to apply the rule that the trial court's decision in making the determination and direction required by rule 54(b) will not be set aside unless an abuse of discretion is shown. It is our view that the trial court's order in the instant case rescinding the release in respect to the settlement of the personal injury claim involves the merits of an action, so that the judgment based thereon is appealable. Accordingly, we find no abuse of the trial court's discretion in making the determination that there is no just reason for delay and the direction for the entry of judgment. Having so held, we must now ascertain the effect of the appeal taken from the judgment of March 13, which was entered pursuant to an order that did not make the determination and direction required by rule 54(b). In Kack v. Kack, after reviewing many federal decisions, we said: In Kack the trial court first ordered judgment which adjudicated fewer than all the claims without making the determination and direction required by rule 54(b). After the entry of judgment upon fewer than all claims, it ordered that the judgment be amended to include an adjudication of all the claims and that it be amended nunc pro tunc. We held that in spite of the nunc pro tunc order, the time for appeal did not commence to run until after the service of the notice of the entry of the amended judgment. Applying the rule in the instant case, the appeal must be dismissed as being *527 premature, having been taken before the determination and direction required by rule 54(b) were made. TEIGEN, C. J., and STRUTZ, PAULSON and KNUDSON, JJ., concur.