Opinion ID: 699275
Heading Depth: 2
Heading Rank: 4

Heading: Late Appeal.

Text: 50 The bankruptcy court granted summary judgment in favor of Beneficial on five of plaintiffs claims: (1) violation of the automatic stay, (2) breach of contract, (3) breach of contract--promissory estoppel, (4) fraud and deceit, and (5) negligent misrepresentation. The district court reversed the bankruptcy court on the grounds that plaintiffs established genuine issues of material fact. Beneficial appeals. 2 51 Beneficial argues that the district court erroneously denied its motion to dismiss the debtors' appeal as untimely. We agree. The bankruptcy court issued a decision and order June 17 granting summary judgment for Beneficial on the five issues described above, but denying it on the fraudulent conveyance issue. The order says the Order shall be entered as judgment as to claims 1, 4, 5, 6 and 7, and that there is no just reason for delaying entry of judgment. The debtors filed a timely Rule 59 motion for reconsideration based on newly discovered evidence, which was denied December 1. That December 1 denial started the appeal time running. See Bankr.Proc.R. 8002(b). 52 The December 1 decision said that the court will consider the defendants' request for sanctions after the trial has been completed, as requested by [Beneficial]. On April 18, the court sent a letter to counsel explaining why the motion for reconsideration was frivolous, and directing Beneficial to provide a declaration of its fees and costs for opposing the motion so that sanctions could be imposed. On June 30, the bankruptcy court issued an order awarding $2,315 in sanctions in favor of Beneficial on the ground that the motion for reconsideration had been frivolous. The debtors filed notice of appeal July 20, of the June 6 order granting summary judgment, the June 22 amended order, the April letter, and the July sanctions award. 53 Under Bankruptcy Rule 8002(a), a party must file a notice of appeal within 10 days of the date of the entry of the judgment, order, or decree appealed from. That ten day period ran from December 1. Bankr.Proc.R. 8002(b). A Rule 54(b) judgment does not give the prospective appellant an election to appeal at that time or later, when the entire case is over; such a judgment is final as to the claims and parties within its scope, and could not be reviewed as part of an appeal from a subsequent judgment as to the remaining claims and parties. Williams v. The Boeing Co., 681 F.2d 615, 616 (9th Cir.1982). The debtors filed their notice of appeal to the district court seven months after the deadline. 54 The district court ruled otherwise on the ground that the bankruptcy court erred in granting Rule 54(b) certification, because it made only a summary determination of no just reason for delay, without making any findings. The district court was correct about the inadequacy of the findings. The court making a Rule 54(b) determination should not direct entry of judgment under Rule 54(b) unless it has made specific findings setting forth the reasons for its order. Morrison-Knudsen v. Archer, 655 F.2d 962, 965 (9th Cir.1981); see also Cadillac Fairview/California, Inc. v. United States, 41 F.3d 562, 567 (9th Cir.1994) (Kleinfeld, J. dissenting). The dangers of profligate Rule 54(b) determinations have materialized in this case. We and the parties have been burdened with the time and expense of five appeals, and 334 pages of briefs, in significant part because of the routine 54(b) determinations issued for interlocutory rulings. Even though counsel agreed on the Rule 54(b) language in the lodged orders, the bankruptcy judge should have stricken it. 55 The district court erred, though, in its conclusion that an erroneous Rule 54(b) determination does not start the running of the time for appeal. We have held that the lack of Morrison-Knudsen findings is not a jurisdictional defect. Alcan Aluminum Corp. v. Carlsberg Financial Corp., 689 F.2d 815, 817 (9th Cir.1982); see also Sheehan v. Atlanta International Insurance Co., 812 F.2d 465, 468 n. 1 (9th Cir.1987). Had the debtors appealed within ten days, the district court might have had discretion to dismiss the appeal because of the bankruptcy court's failure to make appropriate findings, see Cadillac Fairview/California, 41 F.3d at 567. But they appealed too late, so the district court lacked jurisdiction. A Rule 54(b) determination, right or wrong, starts the time for appeal running. This avoids uncertainty for counsel about when to appeal. Counsel should not have asked for Rule 54(b) determinations, or obtained them without findings, but they got them, and must bear the consequences. The time for appeal expired before they filed notice of appeal. Untimely notice of appeal is a jurisdictional defect, so the district court lacked jurisdiction to vacate the summary judgment on appeal. In re Slimick, 28 F.2d 304, 306 (9th Cir.1990); In re Souza, 795 F.2d 855, 857 (9th Cir.1986). 56 We therefore do not reach the merits of the summary judgment determinations which the district court vacated. Because the debtors appealed too late, the bankruptcy court's partial summary judgment in favor of Beneficial must be reinstated. 57