Title: BARBARA RAWLINSON V. GARY L. and JUDITH A. WALLERICH

State: wyoming

Issuer: Wyoming Supreme Court

Document:

BARBARA RAWLINSON V. GARY L. and JUDITH A. WALLERICH2006 WY 52132 P.3d 204Case Number: 05-166Decided: 04/20/2006
APRIL TERM, 
A.D. 2006

 
 
BARBARA 
RAWLINSON,

 
 
Appellant)

(Plaintiff),

 
 
v.

 
 
GARY L. and 
JUDITH A. WALLERICH,

 
 
Appellees

(Defendants).

 
 

 
 
Representing 
Appellant:

Bernard Q. Phelan, Phelan Law 
Offices, Cheyenne, 
Wyoming.

 
 
Representing 
Appellees:

Blair J. Trautwein, Wick, Bramer, 
Ukasick & Trautwein, LLC, Ft. 
Collins, Colorado.

 
 
Before HILL, C.J., and GOLDEN, KITE, 
VOIGT, and BURKE, JJ. 

 
 
BURKE, 
Justice.

 
 
[¶1]       This appeal 
involves a dispute that arose from Ms. Rawlinson's purchase of a house from Mr. 
and Mrs. Wallerich.  After the 
purchase, Ms. Rawlinson discovered water damage to the residence.  She initiated litigation against several 
defendants, including the Wallerichs, in an attempt to recover damages.  The Wallerichs moved the court for 
binding arbitration pursuant to the terms of the sales contract.  Before the court ruled on the motion, 
Ms. Rawlinson and the Wallerichs stipulated to a dismissal of the Wallerichs 
from the litigation in order to arbitrate their claims.  Arbitration never occurred.  Several years later, Ms. Rawlinson filed 
a complaint to compel arbitration against the Wallerichs.  The Wallerichs now assert that they were 
dismissed from the original action with prejudice and that Ms. Rawlinson's 
claims are barred by the doctrine of res 
judicata.  We find that res judicata does not bar Ms. 
Rawlinson's present action to compel arbitration and, accordingly, we 
reverse.

 
 

ISSUE

 
 
[¶2]       Whether Ms. 
Rawlinson's action to compel arbitration is barred by the doctrine of res judicata.

 
 
FACTS

 
 
[¶3]       Ms. 
Rawlinson purchased a house from the Wallerichs in 1994.  After purchase of the residence, Ms. 
Rawlinson noticed water in her crawl space and subsequently discovered that the 
property flooded every spring.  In 
1998, Ms. Rawlinson filed suit against the Wallerichs and other named defendants 
seeking damages for fraud in the inducement, breach of contract, and 
negligence.  The Wallerichs moved to 
compel binding arbitration in accordance with the terms of the sales contract 
which provided:

 
 
The parties agree to make a good faith 
effort to resolve any dispute through mediation, and if mediation is 
unsuccessful, the dispute shall be resolved through arbitration.  ARBITRATION IS BINDING UPON ALL PARTIES 
AND PRECLUDES OTHER LEGAL ACTION.

 
 
(Emphasis in original.)  While the motion was pending, the 
parties sought a voluntary dismissal of the claims against the Wallerichs by 
filing a stipulation, which stated in pertinent part:

 
 
In support of this Stipulation, the 
parties hereto represent to the Court that said Defendants Wallerich have filed 
herein on May 7, 1999, a Motion to Order and Compel Arbitration pursuant to 
Defendant Wallerichs' December 12, 1994 Contract with Carol Walker, as attorney 
in fact for Plaintiff Barbara Rawlinson, said Contract subsequently ratified and 
signed by Barbara Rawlinson on December 23, 1994; and Plaintiffs have indicated 
in their response to the Court that they do not oppose such Motion, but that the 
Court has not yet entered an order ruling on such Motion.

 
 
THEREFORE, the parties hereto 
stipulate and agree that Defendants Gary L. Wallerich and Judith A. Wallerich 
should be dismissed from this action and hereby seek an order of this Court to 
such effect.

 
 
The district court entered an Order 
of Dismissal of Defendants Gary L. Wallerich and Judith A. Wallerich on April 
14, 2000.  The order contained 
language purporting to dismiss the claims against the Wallerichs with 
prejudice.

 
 
[¶4]       Ms. 
Rawlinson pursued the litigation against the remaining defendants.  That litigation continued for several 
years  eventually concluding in 2003.1  After the conclusion of the litigation 
against the remaining defendants, Ms. Rawlinson filed a motion to compel 
arbitration in the original action against the Wallerichs.  The district court denied the motion 
based upon the Order of Dismissal previously entered.2  

 
 
[¶5]       On November 
19, 2004, Ms. Rawlinson initiated a new civil action by filing a Complaint for 
Arbitration against the Wallerichs.  
In the complaint, Ms. Rawlinson sought an order compelling arbitration 
pursuant to the parties' sales contract and the dismissal of the Wallerichs from 
the original litigation in contemplation of arbitration.  The Wallerichs responded to the 
complaint by filing a Motion to Dismiss for Lack of Jurisdiction and Res Judicata.  Ms. Rawlinson opposed the motion and 
submitted an affidavit and exhibits in support of her response.  That same day, Ms. Rawlinson also filed 
a motion for summary judgment regarding her claim.  The district court granted the 
Wallerichs' motion to dismiss stating that:

 
 
On December 11, 1998, the Plaintiff 
brought an action, in District Court Docket 152-172, against Gary and Judith 
Wallerich and others alleging fraud and breach of contract.  Shortly thereafter, Defendants filed a 
Motion to Compel Arbitration, but the 
matter concluded on April 10, 2000 when the parties filed a Stipulation for Dismissal with 
Prejudice.3

 
 
After the matter was dismissed, in 
docket 152-172 Plaintiffs filed a Motion 
to Compel Arbitration in 152-172, but this Motion was denied because the case had 
previously been dismissed with prejudice.  
Now Plaintiff pursues the identical issues in this action but, that 
matter has previously been decided in 152-172.  This case contains the same parties and 
involves a dispute over [the] same contract.  Therefore, in accordance with Order of Dismissal with Prejudice4 and the Order Denying Plaintiffs' Motion to Compel 
Arbitration and to Appoint Arbitrator, both in 152-172, this Court finds 
that the matter is barred pursuant to res judicata.

 
 
This appeal 
followed.

 
 
STANDARD OF 
REVIEW

 
 
[¶6]       This appeal 
involves the interpretation and application of W.R.C.P. 41(a)(1).  This presents a question of law which we 
review de novo.  Peters v. WestPark Hosp., 2003 WY 117, ¶ 8, 76 P.3d 821, 823 (Wyo. 2003).  

 
 
DISCUSSION

 
 
[¶7]       Ms. 
Rawlinson contends that it was error for the district court to dismiss her 
complaint on the basis of res 
judicata.  She acknowledges that 
the order of dismissal entered in the previous litigation contained "with 
prejudice" language, but insists that we must look to the stipulation to 
ascertain the parties' intent.  When 
this is done, Ms. Rawlinson claims that the sole reason for the dismissal was to 
permit arbitration of the dispute.  
Ms. Rawlinson contends that the doctrine of res judicata is inapplicable to the 
present action because her claim is now one for arbitration rather than fraud or 
negligent misrepresentation.  She 
asserts that her claim for arbitration has never been adjudicated on the merits 
and therefore, res judicata does not 
preclude her present action.

[¶8]       The 
doctrine of "res judicata bars the relitigation of previously litigated claims 
or causes of action."  Eklund v. Farmers Ins. Exchange, 2004 WY 
24, ¶ 13, 86 P.3d 259, 263 (Wyo. 2004).  
"Res judicata generally prevents parties from presenting the same claim 
in subsequent actions once that claim has been adjudicated."  Id.  "A policy reason for res judicata is 
that each litigant shall be limited to one opportunity to try his case on the 
merits."  Goglio v. StarValley Ranch Ass'n, 2002 WY 94, ¶ 14, 
48 P.3d 1072, 1077 (Wyo. 2002).  

 
 
[¶9]       The 
Wallerichs claim that the district court properly dismissed Ms. Rawlinson's 
complaint on the basis of res judicata 
because the issue of arbitration was sufficiently raised within the original 
action.  They assert that although 
arbitration never took place, Ms. Rawlinson had a full and fair opportunity to 
address that issue in the first litigation.  Specifically, the Wallerichs point to 
their motion to compel arbitration filed in the original action.  They claim that the issue of arbitration 
was squarely before the district court and that the motion was deemed denied 
ninety days after it was filed in accordance with W.R.C.P. 6(c)(2).  Because the motion was deemed denied, 
the matter was adjudicated on the merits.  
The Wallerichs also claim that the order dismissing them with prejudice 
is the equivalent of an adjudication on the merits and res judicata prevents any further action 
against them relating to Ms. Rawlinson's claims.

 
 
[¶10]     In order to determine 
whether Ms. Rawlinson's current action to compel arbitration is barred by res judicata, we must first look at the 
procedural history of the case.  The 
character of the dismissal is important because a dismissal with prejudice 
operates as an adjudication on the merits and precludes subsequent action.  See, e.g., Eklund, ¶ 14 (We have 
considered "dismissals with prejudice to be the equivalent of a judgment on the 
merits for purposes of res judicata.").  
Conversely, a dismissal without prejudice has no preclusive effect.  Peters, ¶ 19 (voluntary dismissal 
without prejudice rendered the case "a nullity, as if the suit had never been 
filed"); Williams v. Clarke, 82 F.3d 270, 273 (8th Cir. 1996) ("The effect of a voluntary dismissal without prejudice 
pursuant to Rule 41(a) is to render the proceedings a nullity and leave the 
parties as if the action had never been brought.'"); Beck v. Caterpillar, Inc., 50 F.3d 405, 
407 (7th Cir. 1995) ("suit was voluntarily dismissed pursuant to Fed.R.Civ.P. 
41(a), and is treated as if it had never been filed").

 
 
[¶11]     In the prior action, 
Ms. Rawlinson and the Wallerichs stipulated to a voluntary dismissal of the 
claims against the Wallerichs in accordance with W.R.C.P. 41(a)(1).  That rule 
provides:

 
 
(a) Voluntary dismissal; effect thereof. 

(1) By Plaintiff; by 
Stipulation. -- Subject to the provisions of Rule 23(c), of Rule 66, and of any 
statute, an action may be dismissed by 
the plaintiff without order of court: (i) by filing a notice of dismissal at 
any time before service by the adverse party of an answer or of a motion for 
summary judgment, whichever first occurs; or (ii) by filing a stipulation of dismissal signed 
by all parties who have appeared in the action. Unless otherwise stated in the 
notice of dismissal or stipulation, the dismissal is without prejudice, 
except that a notice of dismissal operates as an adjudication upon the merits 
when filed by a plaintiff who has once dismissed in any court an action in which 
service was obtained based on or including the same claim.

 
 
W.R.C.P. 41(a)(1) (emphasis 
added).  The stipulation entered 
into by Ms. Rawlinson and the Wallerichs requested dismissal of the Wallerichs 
from the action.5  It also requested that an order be 
entered "to such effect."  The 
stipulation did not specify whether the dismissal was with or without 
prejudice.  However, the subsequent 
order of dismissal stated that the "Defendants Gary L. Wallerich and Judith A. 
Wallerich . . . are, dismissed herein with prejudice."  Because a dismissal with prejudice 
amounts to an adjudication on the merits, we must determine what effect, if any, 
the discrepancy between the stipulation and the order has on the outcome of this 
case.

 
 
[¶12]     Rule 41(a)(1)(ii) 
contemplates that a voluntary dismissal is effective upon the filing of the 
stipulation.  "Approval or 
implementation of the stipulation by the court is unnecessary."  8 Moore's Federal Practice, 41.34(6)(a) 
(Matthew Bender 3d ed.)  Here, the 
parties requested that an order be entered.  We have not previously considered what 
impact a subsequent order would have on a voluntary dismissal when it is 
requested by the parties.  However, 
we have "acknowledged that since the Wyoming Rules of Civil Procedure are 
patterned after the Federal Rules of Civil Procedure, federal court 
interpretations of their rules are highly persuasive in our interpretation of 
the corresponding Wyoming rules."  Peters, ¶ 10.   Federal courts interpreting this 
rule have recognized that: 

 
 
[S]uch stipulations take effect when filed and do not require an order of the 
court. Fed.R.Civ.P. 41(a)(1)(ii). Therefore, the district court's order 
approving the dismissal is of no consequence. This distinction should 
eliminate any confusion created by the fact that the district court entered the 
order approving the dismissal and the order granting summary judgment on the 
same day. The claims were dismissed when the parties filed the stipulation, 
which was three days before the court entered the order granting summary 
judgment. We have held that, when the 
parties file a stipulation of voluntary dismissal pursuant to Rule 41(a)(1)(ii), 
"any further actions by the court [are] superfluous." United 
States v. Kellogg (Matter of West Texas Mktg. Corp.), 12 F.3d 497, 501 (5th Cir.1994); see 
also Williams v. Ezell, 531 F.2d 1261, 1264 (5th Cir.1976).

Meinecke 
v. H & R Block Income Tax Sch., 66 F.3d 77, 82 (5th Cir. 1995) (emphasis added).  See also Smith v. Phillips, 881 F.2d 902, 904 (10th Cir. 1989) ("[V]oluntary dismissal by stipulation under Rule 
41(a)(1)(ii) is of right, cannot be conditioned by the court, and does not call 
for the exercise of any discretion on the part of the court.  Once the stipulation is filed, the 
action on the merits is at an end.").  
An exception to this rule permits parties to request an order enabling 
the court to retain jurisdiction.  8 
Moore's Federal Practice, 41.34(6)(a), (h) 
(Matthew Bender 3d ed.) (parties may request that the court enter an order 
retaining jurisdiction over the action for the purpose of enforcing the terms of 
the stipulation or settlement agreement if the terms are incorporated into the 
dismissal order and the parties agree).  
In this case, the parties requested that an order be entered, but only to 
the extent that it approved their stipulation.  There was no request that the court 
retain jurisdiction.  We therefore 
conclude that the order was superfluous because it was entered after the 
Wallerichs were dismissed from the action by the filing of the stipulation.  

 
 
[¶13]     Having determined that 
the Wallerichs were dismissed from the action upon the filing of the 
stipulation, we must look to the terms of the stipulation to answer the question 
of whether the dismissal was with or without prejudice.  The stipulation was silent in this 
regard and, as a result, the rule requires the dismissal be without 
prejudice.  W.R.C.P. 41(a)(1)(ii) 
("Unless otherwise stated in the . . . stipulation, the dismissal is without 
prejudice.").  The subsequent order 
could not transform the stipulated dismissal into a dismissal with 
prejudice.  McKenzie v. Davenport-Harris Funeral 
Home, 834 F.2d 930, 934-935 (11th Cir. 1987) ("[W]here the stipulation does 
not state that the dismissal is with prejudice, it must be considered without 
prejudice . . . and the court was without authority. . . to dismiss the . . . 
claim with prejudice.").  

 
 
[¶14]     Ms. Rawlinson's 
complaint in this action seeks an order compelling arbitration.  The stipulation filed in the original 
action dismissed the Wallerichs from the litigation without prejudice.  Once the stipulation was filed, the 
action against the Wallerichs was a nullity, as if the action was never filed.6  This conclusion is consistent with our 
previous treatment of voluntary dismissals under Rule 41.  See Peters v. West Park Hosp., 2003 WY 
117, 76 P.3d 821 (Wyo. 2003) (Rule 41(a)(1) motion dismissing the case without 
prejudice rendered the case a nullity, as if the suit had never been filed and 
the district court could not enter an order dismissing the action with 
prejudice.)  As a result of the 
voluntary dismissal, Ms. Rawlinson's claim for arbitration has never been 
adjudicated.  Thus, the doctrine of 
res judicata does not apply to her 
complaint for arbitration.  The 
district court improperly dismissed the complaint on that basis. 

 
 
[¶15]     Reversed and remanded 
for further proceedings consistent with this opinion.

  

FOOTNOTES

 
 

1See, e.g., 
Rawlinson v. Board of Public Utilities, 2001 WY 6, 17 P.3d 13 (Wyo. 2001); Rawlinson v. Greer, 2003 WY 28, 64 P.3d 120 (Wyo. 2003).

 
 

2The status of the original action at the 
time Ms. Rawlinson's motion to compel arbitration was filed is unclear.  The Order Granting Motion to Dismiss 
entered by the district court in the present action suggests that the entire 
case had been dismissed.  
Regardless, the Wallerichs were not a party to the original action at the 
time Ms. Rawlinson filed her motion.

 
 

3The district court erroneously referred 
to the stipulation as a "Stipulation for Dismissal with Prejudice."  The stipulation is entitled "Stipulation 
for Dismissal of Defendants Gary L. Wallerich and Judith A. Wallerich."  The stipulation does not contain any 
language regarding whether it was a dismissal with or without 
prejudice.

 
 

4The title of this order was also 
incorrectly identified by the district court.  The correct title is "Order of Dismissal 
of Defendants Gary L. Wallerich and Judith A. Wallerich."  

 
 

5Although not raised by the parties, we 
note that W.R.C.P. 41(a)(1)(ii) permits a voluntary dismissal when a stipulation 
is signed by "by all parties who have appeared in the action."  Federal case law interpreting the 
federal counterpart to W.R.C.P. 41(a) permits parties to use this rule to 
dismiss some of the parties as opposed to the entire action.  This may be accomplished when the 
plaintiff and those defendants being dismissed sign the stipulation and the 
stipulation does not purport to dismiss the entire action.  The stipulated dismissal is then 
effective as to those signatories.  
See, e.g., Pipeliners Local Union 
v. Ellerd, 503 F.2d 1193, 1199 (10th Cir. 1974) (finding that the claims 
against some of the parties were effectively dismissed even though a formal 
stipulation of dismissal was not signed by all of the parties to the action as 
contemplated by Fed.R.Civ.P., Rule 41(a)).  
See also Oswalt v. Scripto, 
Inc., 616 F.2d 191, 195 (5th Cir. 1980) (acknowledging that several courts 
have found stipulations dismissing individual parties or claims to a lawsuit 
without dismissing the entire controversy permissible.); Rudloff v. Johnson, 267 F.2d 708 (8th 
Cir. 1959); Battle v. Municipal Housing 
Authority for City of Yonkers, 53 F.R.D. 423 (S.D.N.Y. 1971).  Ms. Rawlinson, as the plaintiff, sought 
to dismiss only the Wallerichs from the litigation and did not attempt to 
dispose of the entire action through the stipulation.  The Wallerichs signed the 
stipulation.  As a result, the 
stipulation was sufficient to dismiss the Wallerichs even though the stipulation 
was not signed by all of the named defendants.    

 
 

6In light of our decision that proper 
application of Rule 41(a)(1)(ii) renders the original action a nullity, further 
discussion of the Wallerichs' contention that their motion to compel arbitration 
was deemed denied by application of W.R.C.P. 6(c)(2) is unnecessary.