Opinion ID: 1885183
Heading Depth: 1
Heading Rank: 11

Heading: Finality of the March 31, 1993, Order

Text: Courts have inherent authority to issue final judgments: The Constitution of Alabama of 1901 vests the judicial power in the Unified Judicial System. Ala. Const.1901, amd. 328, §§ 6.01(a). The judicial power, at its core, is the power to render final judgments in cases before the courts. See Marbury v. Madison, 5 U.S. (1 Cranch) 137, 177, 2 L.Ed. 60 (1803) (`It is emphatically the province and duty of the judicial department to say what the law is.'); Plaut v. Spendthrift Farm, Inc., 514 U.S. 211, 219, 115 S.Ct. 1447, 131 L.Ed.2d 328 (1995) (stating that the Constitution gives the `Judiciary the power, not merely to rule on cases, but to decide them'); Sanders v. Cabaniss, 43 Ala. 173, 177 (1869) (stating that the judicial power requires the exercise of judgment in a case or controversy). Inherent in the constitutional obligation to render final judgments is the power to conduct judicial proceedings in an efficient and effective manner. Ex parte Segrest, 718 So.2d 1, 5 (Ala.1998). If an Alabama trial court goes further and issues an order it does not have jurisdiction to enter, the order is void and can never be final. It is this Court's duty to vacate such an order. The rationale behind a Rule 54(b) certification is that it is more efficient to have a single appeal than to have multiple appeals. Without interlocutory appeals, a trial will proceed more rapidly to completion. The basis for Rule 54(b) certification entails more than mere policy considerations. A trial court continues to have jurisdiction until a case is final, and two courts (trial and appellate) cannot have jurisdiction at the same time. In this case, however, Rule 54(b) certification has been used to multiply, rather than to reduce, the number of appeals. A commonly used definition of the term final judgment is that it is an order that ends the litigation on the merits and leaves nothing for the court to do but execute the judgment. Catlin v. United States, 324 U.S. 229, 233, 65 S.Ct. 631, 89 L.Ed. 911 (1945). The distinction is clearer in cases at law where money damages are the remedy sought. Thus, where a court issues an order establishing liability for damage but has delayed hearings on the amount of damages, it has not issued a final judgment. Moody v. State ex rel. Payne, 351 So.2d 547 (Ala.1977). For example, consider a typical action in negligence arising out of injuries sustained in an automobile accident. The question of breach of duty is analytically distinct from the question of the amount of damages. It is not necessary to determine the amount of damages in order to determine whether there has been a breach of duty. If a driver crosses the centerline because he is distracted while talking on his cellular telephone and hits an oncoming car, his breach of duty can be determined without knowing what the damages are. Yet a judgment entered on his liability would not be final and appealable until damages are determined and awarded. By the eighteenth century, English courts were applying different rules in equity cases. Appeals might be taken from interlocutory orders and decrees as well as from final decrees. Crick, The Final Judgment Rule as a Basis for Appeal, 41 Yale L.J. 539, 541-43, 545-48, 550 (1932). The trend in American courts, on the other hand, has been to apply the common-law rule of final judgments to equity cases. 41 Yale L.J. at 541-43, 545-48, 550. During the course of this litigation the circuit court judges certified several orders as final, but it is primarily the March 31, 1993, order with which this Court is concerned. Rule 54(b), Ala.R.Civ.P., states: When more than one claim for relief is presented in an action ... or when multiple parties are involved, the court may direct the entry of a final judgment as to one or more but fewer than all of the claims or parties only upon an express determination that there is no just reason for delay and upon an express direction for the entry of judgment. The common-law rule is that orders may not be reviewed until all matters in a particular case are final. Because modern rules of civil procedure generally provide for more liberal joinder of parties and claims in a single action, it is necessary also to give some flexibility to the finality rule. That, in part, is the purpose of Rule 54(b). That rule provides that a trial court may certify certain orders as final, and therefore appealable, even if all claims of all parties have not been finally resolved by the trial court. [33] The plaintiffs in this case argue that the March 31, 1993, order resolved fewer than all claims and that the resolved claim was separate and distinct from the unresolved ones. However, Rule 54(b) does not change the common-law standard of finality as to individual claims or parties. A Rule 54(b) certification cannot make final an order that is not inherently final, such as the denial of a motion for a summary judgment. It is my opinion that the March 31, 1993, order resolved nothing at all. The plaintiffs contend that one of the claims was made final by the order of March 31, 1993; however, all of the claims are intertwined and focus on the alleged unconstitutionality of Alabama's public-school system. Whether any claim is or is not final depends upon whether the order reaches a definitive resolution. The Rule 54(b) partial-claim adjudication rule stated above applies to one or more, but not all, of the claims being adjudicated to a complete resolution. It does not allow an incomplete resolution of one claim. Liberty Mutual Ins. Co. v. Wetzel, 424 U.S. 737, 742-44, 96 S.Ct. 1202, 47 L.Ed.2d 435 (1976) (interpreting Rule 54(b), Fed.R.Civ. P.). In many cases, the award of equitable relief is functionally, if not essentially, the same as the award of damages, and there clearly is no need for more than one final order in a particular action. For example, ordering specific performance of a contract is functionally the same as awarding damages. The order is final, and although the damages award is not an order directed personally to the defendant, if he does not pay voluntarily, the court may have to issue subsequent orders to execute the judgment. Other equity cases may not bear as marked a similarity to cases at law for damages. For example, an order to partition real estate may be final even though the court issues a subsequent order calling for an accounting, which may also be final. The plaintiffs argue that this case has been properly divided into a Liability Phase and a Remedy Phase that are analytically distinct. In other words, liability can be determined without determining an appropriate remedy. Additionally, the plaintiffs argue that because the remedy sought and awarded in this case is equitable in nature, this action can have more than one final order. The intervenors in the proration case (the universities), which have filed briefs in response to this Court's question as to the finality of the March 31, 1993, order, argue that the distinction between law and equity has been abolished in Alabama and that the same finality rule that applies to cases where the plaintiff seeks damages at law should apply to cases where the plaintiff seeks an equitable remedy. In short, the plaintiffs argue that the case should be treated as a case in equity, while the intervenors argue that the case should be treated like any action at law for purposes of applying the final-order rule. The question of the finality of an order is one of jurisdiction. A final judgment is necessary to give jurisdiction to this court on appeal. Marsh v. Wittmeier, 280 Ala. 172, 173, 190 So.2d 920, 920 (1966). [34] The purpose of Rule 54(b), Ala.R.Civ.P., is to make final an order which does not adjudicate the entire case but as to which there is no just reason for delay in the attachment of finality. Foster v. Greer & Sons, Inc., 446 So.2d 605, 609 (Ala.1984), overruled on other grounds, Ex parte Andrews, 520 So.2d 507 (Ala.1987). Rule 54(b) does not create an exception to the rule that finality is required in order for a judgment to be appealable. [N]one of the procedures that this Court has adopted to facilitate the policies underlying Rule 54(b) should be construed as relaxing the Rule 58 requirements for the entry of a proper judgment.... On the contrary, these provisions, taken in conjunction with the cases construing them, compel the conclusion that if an order entered in a case with multiple claims `does not meet the requirements of Rule 54(b),' then `no formal judgment [has been] entered.' Burlington Northern R.R. v. Whitt, 611 So.2d 219, 223 (Ala.1992), quoting Balboa Ins. Co. v. Sippial Elec. Co., 379 So.2d 579 (Ala.1980). A final judgment is an `order that conclusively determines the issues before the court and ascertains and declares the rights of the parties involved.' An order or ruling that `adjudicates fewer than all of the claims or the rights and liabilities of fewer than all the parties shall not terminate the action as to any of the claims or parties.' Lunceford v. Monumental Life Ins. Co., 641 So.2d 244, 246 (Ala.1994) (citations omitted). The proper use of Rule 54(b) dictates that even in actions involving multiple claims or parties there must be full adjudication of one claim or of all claims as to one party. Therefore, a ruling that holds a defendant liable without fully deciding the remedies is not final and cannot be the subject of a Rule 54(b) certification. A prime example of this type of ruling was present in Liberty Mutual Insurance Co. v. Wetzel, supra. In that case, the trial judge, by entering a partial summary judgment, held the defendant liable but failed to determine the remedies. The United States Supreme Court held that despite the fact that the District Court undoubtedly made the findings required under the Rule,[ [35] ] had it been applicable, those findings do not in a case such as this make the order appealable pursuant to 28 U.S.C. § 1291 [the federal equivalent to § 12-22-2, Ala.Code 1975] 424 U.S. at 743-44, 96 S.Ct. 1202, because orders where assessment of damages or awarding of other relief remains to be resolved have never been considered to be `final' within the meaning of 28 U.S.C. § 1291. 424 U.S. at 744, 96 S.Ct. 1202. In this case, the trial court purportedly found liability and then ordered some remedies in its March 31, 1993, order, but left determination of other remedies for a later date. The order is not, by its own terms, a final disposition of the claim at issue in the case; therefore, it does not meet the standards of Rule 54(b). [T]he trial court cannot confer appellate jurisdiction upon this court through directing entry of judgment under Rule 54(b) if the judgment is not otherwise `final.' Robinson v. Computer Servicenters, Inc., 360 So.2d 299, 302 (Ala.1978). Thus, the March 31, 1993, order cannot be considered a final, and therefore appealable, order. This Court explained the requirement in Jewell v. Jackson & Whitsitt Cotton Co., 331 So.2d 623, 625 (Ala.1976). There the Court stated: A final judgment is a terminative decision by a court of competent jurisdiction which demonstrates there has been complete adjudication of all matters in controversy between the litigants within the cognizance of that court. That is, it must be conclusive and certain in itself. All matters should be decided; damages should be assessed with specificity leaving the parties with nothing to determine on their own. A judgment for damages to be final must, therefore, be for a sum certain determinable without resort to extraneous facts. (Citations omitted.) Nevertheless, as stated earlier, where a court anticipates further remedies, an order will not be considered final. In other words, the Court erroneously fashioned different rules for finality in a case seeking equitable relief as opposed to one seeking money damages. Such a ruling is at odds with the elimination of the distinction between law and equity, accomplished in Alabama in 1973. [36] This Court has emphasized on several occasions that it should be remembered that the procedural differences between law and equity have been abolished and there is only one form of action, known as a `civil action.' Du Boise v. Brewer, 349 So.2d 1086, 1087 (Ala.1977). It is also at odds with other rulings of this Court, where the rule of requiring complete disposition of a claim has been applied in cases seeking equitable remedies. See Tubbs v. Brandon, 366 So.2d 1119, 1120 (Ala.1979) (applying the final-judgment rule in dismissing an appeal from an order in an action to enjoin the violation of a restrictive covenant); Chambers v. Chambers, 356 So.2d 634, 635 (Ala.1978) (dismissing an appeal because [a]s yet the trial court has not decided whether the property can be equitably divided, or whether a sale is necessary, or whether the multiple plaintiffs are entitled to the accounting requested); Cates v. Bush, 293 Ala. 535, 307 So.2d 6 (1975) (applying the final-judgment statute in dismissing an appeal from a decree in a case involving, among other things, requests for sale of land); Cherokee County Hospital Bd. v. Retail, Wholesale & Department Store Union, 294 Ala. 151, 313 So.2d 514, 517 (1975) (dismissing an appeal in an action seeking an injunction). It would be counterproductive to our unified system of law and equity to continue the distinction set forth in James v. Alabama Coalition for Equity ; the result being that some cases would require finality and others would not, depending on the type of remedy sought. Moreover, to do so ignores the Supreme Court's words in Liberty Mutual Insurance v. Wetzel : [W]here assessment of damages or awarding of other relief remains to be resolved, the order will not be considered final. 424 U.S. at 744, 96 S.Ct. 1202 (emphasis added). Even in James, this Court quoted the proper standard for finality but elected to draw a distinction between final judgments at law as opposed to those at equity. Quoting Newton v. Ware, 271 Ala. 444, 450, 124 So.2d 664, 670 (1960), the Court stated: `If there is a decree directing further proceedings under the direction of the court in order to make the final decree effective, such decree is interlocutory and remains within the control of the court because as to such decree and further proceedings thereunder the cause remains in fieri.' 713 So.2d at 945. That description precisely defines the March 31, 1993, order, because the order itself expressly provided for further proceedings for the purpose of establishing the procedures and timetable for determination of the appropriate remedy in this case. Appendix to The Opinion of the Justices No. 338, 624 So.2d at 166. Thus, by this Court's own words, if we ignore the distinction between law and equity, as we should, the March 31, 1993, order represented an interlocutory order, which the trial court could never make final unless he had fashioned a remedy. This Court directed the parties to address the issue whether the March 31, 1993, order was a final, and therefore appealable, order. Although the March 31, 1993, order is the only one directly at issue, the question cannot be answered without considering its relationship to the other orders entered in this case that were certified under Rule 54(b) or that were reviewed on appeal. The record shows that the circuit court contemplated the issuance of further orders and that it, in fact, issued further orders. The Liability Order contained partial remedies, demonstrated in part by the fact that the trial court stated that further proceedings would be necessary. In fact, in March of this year, the plaintiffs filed a motion to reopen the remedy proceedings and seek to refine and implement the declaratory judgment relief of the March 31, 1993, order. That order is still not final; it can never be final. I now consider whether the orders addressing the claims in this case could ever become final.