Court Opinion

ID: 9630724
Source: CourtListenerOpinion
Date Created: 2023-08-22 10:18:27.53925+00
Date Added: 2024-06-11T18:07:42.294628
License: Public Domain

SUTIN, Judge (dissenting). I dissent. The majority opinion states: The trial court dismissed the plaintiffs-minority shareholders’ derivative action and request for liquidation, brought pursuant to § 53-16-16, N.M.S.A.1978. They appeal; we affirm. The trial court entered a “Decision” in which it made findings of fact and conclusions of law. The conclusions of law read: 1. The restraining order heretofore entered will be dissolved. 2. The complaint of plaintiffs shall be dismissed. 3. Each of the parties should bear his own costs. Plaintiffs appealed from the Decision, Findings of Fact and Conclusions of Law. No final judgment or decision was entered that the prior restraining order be dissolved nor that plaintiffs’ complaint be dismissed with prejudice. Rule 3(a)(1) of the Rules of Appellate Procedure for civil cases reads: In civil actions, any party aggrieved may appeal to the appropriate appellate court within thirty days after entry of: (1) any final judgment or decision; This language means “any final judgment or final decision.” Rule 52(B)(1) of the Rules of Civil Procedure provides for a decision of the trial court which shall consist of its findings of fact and conclusions of law. Rule (B)(2) provides that: Upon motion of a party made not later than ten days after entry of judgment the court may amend its findings or make additional findings and may amend the judgment accordingly. [Emphasis added.] Subsection (B)(2) declares that “findings of fact and conclusions of law” do not constitute a “final judgment or decision." McDaniel v. Vaughn, 42 N.M. 422, 423, 80 P.2d 417 (1938) says: The * * * [rule] requires the district court to make a decision consisting of findings of such ultimate facts and conclusions of law stated separately as are necessary to support his judgment, in a single document * * *. The same result may be accomplished by incorporating the findings and conclusions in the judgment. [Emphasis added.] “[T]he word ‘decision’ as used in Rule 52 means ‘findings of fact and conclusions of law.’ ” United Nuclear Corp. v. General Atomic Co., 93 N.M. 105, 122, 597 P.2d 290 (1979). It does not mean “judgment.” Trujillo v. Tanuz, 85 N.M. 35, 508 P.2d 1332 (Ct.App.1973). Rules of practice and orderly procedure require that findings of fact and conclusions of law be made before judgment is entered. Gilmore v. Baldwin, 59 N.M. 51, 278 P.2d 790 (1955); Kipp v. McBee, 78 N.M. 411, 432 P.2d 255 (1967). The decision of the court is the basis upon which the judgment of the court rests. Mosley v. Magnolia Petroleum Co., 45 N.M. 230, 114 P.2d 740 (1941); Lusk v. First Nat. Bank of Carrizozo, 46 N.M. 445, 130 P.2d 1032 (1942). Prior to 1974, an appeal was allowed from entry “of any final judgment.” It was then held that where no final judgment was contained in the record, the appeal is dismissed. Cornett v. Fulfer, 26 N.M. 175, 189 P. 1108 (1919). The parties filed a stipulation that cured the proposition. But the order of the trial court was not a final judgment and the appeal was again dismissed. Cornett v. Fulfer, 26 N.M. 368, 189 P. 1108 (1920). In 1974, the words “or decision” were added. “The words ‘final decision in the district court,’ mean the same thing as ‘final judgments and decrees’ as used in former acts regulating appellate jurisdiction.” In the Matter of the Application of Tiffany, 252 U.S. 32, 36, 40 S.Ct. 239, 241, 64 L.Ed. 443, 444 (1920); Karl Kiefer Mach. Co. v. U. S. Bottlers Machinery Co., 108 F.2d 469 (7th Cir. 1939). “A ‘final decision’ generally is one which 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, 633, 89 L.Ed. 911, 916 (1945). Crowe v. De Soto Consolidated School District, 246 Iowa 38, 66 N.W.2d 859, 860 (1954) says: As a general rule decisions, opinions, findings or verdicts do not constitute a judgment or decree, but merely form a basis on which the judgment or decree is subsequently to be rendered. [Citations omitted.] A final judgment or decision is one that finally adjudicates the rights of the parties, and it must put it beyond the power of the court which made it to place the parties in their original positions. It is a determination which may be enforced by execution or in some similar manner. To the same effect is Chase v. United States Fidelity & Guaranty Co., 71 R.I. 81, 42 A.2d 488 (1945). To deviate from orderly procedure and declare a Rule 52 “decision” to be a “final judgment or decision” will open the door to extraneous transformation. This Court lacks jurisdiction to decide this case on the merits. I also dissent from the majority opinion. It fails to respond to plaintiffs’ position. Plaintiffs claim that the decision of the trial court failed to address the stockholders’ derivative action. I agree. The trial court found that: It is the view of the Court that the problem is inherent in the business relationships of the parties and their respective interests in the corporation, and is not a problem capable of resolution by the Court. [Emphasis added.] The record shows that this case was tried on August 30, 1979 and October 15, 1980. Thirteen and one-half months had passed between both hearings. On November 24, 1980, plaintiffs filed requested findings and conclusions. Defendants requested none. On June 17, 1981, twenty-two months after the first hearing, eight months after the last hearing and seven months after plaintiffs’ requests were filed, the court denied plaintiffs’ requests and rendered its decision. What circumstances caused this extraordinary delay is unknown. In Weiss v. Hanes Mfg. Co., 90 N.M. 683, 568 P.2d 209 (Ct.App.1977) we did not rely on the memory of the court. We said: “Memory” is uncertain 21'/2 months later when “memory” is restricted to a recollection of the veracity of witnesses who testified and a remembrance of the evidence heard during trial. Many duties, affairs, events, occurrences and interests have intervened during the interim period. The certainty of memory begins to fade with the passage of time. Decisions based on memory are as uncertain as the testimony of witnesses who seek to recollect the facts of an event that occurred two years ago. Refreshment of memory by a court might take on the color of certainty if the testimony were read. If not read, experience teaches that a decision based upon memory alone is poor judgment and should be avoided. [Id. 687, 568 P.2d 209.] This extraordinary delay was unusual with the district judge. It must have been caused by events beyond his control. The problem involved is capable of resolution by the court. To arrive at a fair result, the record, transcript of proceedings and exhibits should be reviewed and studied, a decision rendered and final judgment entered. Under Rule 52(B), when requests are made, it is mandatory that the trial court find all of the ultimate facts and determine all of the issues in the case. The failure to do so is reversible error. Laumbach v. Laumbach, 58 N.M. 248, 270 P.2d 385 (1954); Archibeck v. Mongiello, 58 N.M. 749, 276 P.2d 736 (1954); Thompson v. H. B. Zachry Co., 75 N.M. 715, 410 P.2d 740 (1966). The failure of defendants to submit requested findings and conclusions must not destroy this rule. Coupled with delay in rendering the decision, an exception should be made to the rule that the failure to find an issue in which a party has the burden of proof is a finding to the contrary. State ex rel. Thornton v. Hesselden Const. Co., 80 N.M. 121, 452 P.2d 190 (1969). Rule 52(B)(1) provides that, in its decision, “the court shall find the facts and give its conclusions of law pertinent to the case * * This requirement is mandatory. The court must find the facts on every issue, every controverted issue of fact or every issue of fact raised by the pleadings. Rule 52(a)(1) of Ch. 1A. Rules of Civil Procedure of North Carolina provides that: [T]he court shall find the facts specially and state separately its conclusions of law thereon * * *. Sprinkle v. Sprinkle, 17 N.C.App. 175, 193 S.E.2d 468, 472 (1972) states the established rule: In cases where the trial judge passes on the facts, it is necessary that he (1) find the facts on ail issues joined on the pleadings, (2) declare the conclusions of law arising on the facts, and (3) enter judgment accordingly. [Emphasis by court.] Jones v. Murdock, 20 N.C.App. 746, 203 S.E.2d 102, 103 (1974) said: The deficiency * * * is more than a technical one. The necessity for the finding of facts and entry thereof, and for the conclusions of law to be drawn from the facts, is to allow review by the appellate courts. Without such findings and conclusions, we are unable to determine whether or not the judge correctly found the facts or applied the law thereto. [Citations omitted.] Without such findings we may only surmise what the trial court found. The requirement is not designed to encourage ritualistic recitations by the trial court. The requirement is designed to dispose of the issues raised by the pleadings and to allow the appellate courts to perform their proper function in the judicial system. Montgomery v. Montgomery, 32 N.C.App. 154, 231 S.E.2d 26 (1977). When an essential finding is not made, the cause is remanded to the district court for the judge to find the facts from the record evidence as to all the material issues raised by the evidence. Rosenthal's Bootery, Inc. v. Shavitz, 48 N.C.App. 170, 268 S.E.2d 250 (1980). See also, San Bernardino V. W. Dev. Co. v. San Bernardino V. M. W. Dist., 236 Cal.App.2d 238, 45 Cal.Rptr. 793 (1965); Hagy v. Sharp, 117 Pa.Super. 187, 177 A. 578 (1935); Young v. Miner, 141 Wis. 501, 124 N.W. 660 (1910). The omission of findings seriously prejudices a party’s claim or defense. The trial court also found that: The business decisions and the management of the affairs of the corporation by the defendant, by use of his majority stock interest, are within the bounds of discretion, and sufficiently in the interests of the corporation that they should not be disturbed by the Court. [Emphasis added.] “Discretion” is not the standard of conduct of a majority stockholder who holds a fiduciary relationship with the corporation and minority stockholders. H. B. Cartwright v. U. S. B. & T. Co., 23 N.M. 82, 167 P. 436 (1917). Section 46-1-1, N.M.S.A. 1978. The majority opinion transposes the meaning of the findings of the trial court. It holds that the trial court decided that the majority stockholder acted in good faith; that the corporate obligations incurred were reasonable and advantageous to the corporation, and that the corporation suffered no losses because of corporate mismanagement on breach of fiduciary duty. These are issues for the trial court, not this Court, to determine. The majority stockholder replaced all minority shareholders on the board of directors. It consisted of himself, his wife and son. All actions taken thereafter were by an interested board of directors. Transactions undertaken by this board should be carefully scrutinized when governed by a fiduciary relationship. This issue should be decided by the trial court based upon the fiduciary relationship that existed between the parties. This case should be remanded to the district court: (1) to resolve the issues in this case pursuant to the fiduciary relationship between the parties and render a “Decision” pursuant to Rule 52(B). (2) to enter “a final judgment or decision,” order an appeal therefrom to be filed and have a supplementary record sent to this Court.