Court Opinion

ID: 2999170
Source: CourtListenerOpinion
Date Created: 2015-09-24 19:51:20.229108+00
Date Added: 2024-06-11T13:24:21.300628
License: Public Domain

In the
 United States Court of Appeals
               For the Seventh Circuit
                          ____________

No. 05-2941
CHASE MANHATTAN MORTGAGE CORP.,
                                                    Plaintiff-Appellee,
                                  v.

JAMES E. MOORE,
                                                Defendant-Appellant.
                          ____________
             Appeal from the United States District Court
        for the Northern District of Illinois, Eastern Division.
                No. 02 C 2454—Amy J. St. Eve, Judge.
                          ____________
      SUBMITTED MARCH 28, 2006—DECIDED MAY 4, 2006
                          ____________

  Before POSNER, EASTERBROOK, and EVANS, Circuit Judges.
  POSNER, Circuit Judge. Chase Manhattan brought this
diversity suit against Moore to foreclose its mortgage on his
home, order the home sold, and, if the proceeds of the sale
were insufficient to satisfy Chase’s debt, enter a deficiency
judgment for the unpaid balance. Chase moved for sum-
mary judgment, which the district judge denied. But on
Chase’s motion to reconsider, the judge, upon discovering
that the documents Moore had submitted in opposition to
the motion to show that he’d paid off the mortgage were
fake, granted summary judgment for Chase, and entered
judgment. Moore appeals.
2                                                 No. 05-2941

   Chase argues that we do not have jurisdiction of the
appeal because the judge did not enter a final judgment. 28
U.S.C. § 1291. But she did: the judgment order states that
judgment is awarded to Chase Manhattan. It is true that
the order describes the judgment as merely the grant of
“summary judgment on Chase’s foreclosure claim.” And
it is also true that such a judgment does not grant the
plaintiff any relief. The judgment does not order Moore
to do anything or to pay anything.
  But that does not negate finality. The test is not the
adequacy of the judgment but whether the district court has
finished with the case. If it has, ending the lawsuit, the
judgment can be appealed, for otherwise a plaintiff who had
received a favorable ruling but no relief would have to ask
the court of appeals to mandamus the district judge. And so
in Munson Transportation, Inc. v. Hajjar, 148 F.3d 711, 714 (7th
Cir. 1998), we concluded that the district court’s order was
final, despite not addressing all the claims before the court,
because it contained language “calculated to conclude all
the claims before the district court” and indeed said “this
case is terminated.” Similarly, Moreau v. Harris County, 158
F.3d 241, 244 (5th Cir. 1998), explains that a judgment is
final when it is “couched in language calculated to conclude
all claims before [the district court].” The statement in
Coopers & Lybrand v. Livesay, 437 U.S. 463, 467 (1978),
quoting Catlin v. United States, 324 U.S. 229, 233 (1945), that
a final judgment is one that “ends the litigation on the
merits and leaves nothing for the court to do but execute the
judgment,” is, when wrenched from its context (always a
perilous thing to do), overbroad. Coopers & Lybrand involved
an explicitly interlocutory order, namely a class certification
order; and in Catlin the district court had been explicit that
the case was not over in that court.
No. 05-2941                                                    3

   The only oddity here is that Chase, which got nothing,
is not appealing, whereas Moore, who was not ordered to
do or pay anything and thus remains in possession of his
house despite his having defaulted on the mortgage, is
appealing. In arguing that the judgment of the district
court is not final, Chase must be expecting to go back to
the district judge and ask her for an order foreclosing
its mortgage, selling the mortgaged property, and, if nec-
essary, entering a deficiency judgment. Mistakenly sup-
posing that there was no final judgment and therefore that
the case must still be alive in the district court, Chase missed
the rather elementary point that there is no longer any
lawsuit pending in that court. If we affirm, Chase will either
have to file a new lawsuit, again demanding foreclosure, but
risking encountering the bar of res judicata, or move under
Rule 60(b)(1) of the Federal Rules of Civil Procedure to set
aside the original judgment. What Chase should have done
was, after reading the judgment order, to ask the district
judge to amend it to add an order of foreclosure.
  The judgment is radically defective. It’s as if the judge had
said midway through the case “I am tired of this case so I’m
entering a judgment terminating it.” It would be a final
order but not a proper disposition. But can we do anything
about it? Chase Manhattan has not appealed, so we cannot
alter the district court’s judgment in its favor. El Paso Natural
Gas Co. v. Neztsosie, 526 U.S. 473, 479 (1999); Mother & Father
v. Cassidy, 338 F.3d 704, 713 (7th Cir. 2003); Adkins v. Mid-
American Growers, Inc., 167 F.3d 355, 360 (7th Cir. 1999).
Moore is the appellant; but if he was not harmed by the
judgment, he lacks standing to appeal.
  If he was not harmed: in LaBuhn v. Bulkmatic Transport Co.,
865 F.2d 119, 122 (7th Cir. 1988), we noted, citing
Schwartzmiller v. Gardner, 752 F.2d 1341, 1345 (9th Cir. 1984),
4                                                 No. 05-2941

that there is authority that a winning party can appeal in
order to challenge an adverse finding by the trial court that
might form the basis for a plea of collateral estoppel in a
subsequent suit. But against that we pointed out that a
finding which a party had no incentive, other than fear of
collateral estoppel, to appeal, because he had won, has no
collateral estoppel effect; so his fear is baseless. Field v.
Mans, 157 F.3d 35, 41 (1st Cir. 1998); Concerned Citizens of
Cohocton Valley, Inc. v. N.Y. State Dept. of Environmental
Conservation, 127 F.3d 201, 205-06 (2d Cir. 1997); Bath Iron
Works Corp. v. Coulombe, 888 F.2d 179 (1st Cir. 1989) (per
curiam); Balcom v. Lynn Ladder & Scaffolding Co., 806 F.2d
1127 (1st Cir. 1986) (per curiam); Gelb v. Royal Globe Ins. Co.,
798 F.2d 38, 44 (2d Cir. 1986); Restatement of Judgments
(Second) § 27, comment h (1982); see generally 15 Charles
Alan Wright, Arthur R. Miller & Edward H. Cooper, Federal
Practice and Procedure § 3902, at pp. 401-06 (1976).
   That seems right in general, but this case is unusual. For
it is not as if Moore had really won in the district court. The
only ruling the court made went against him—the ruling
that he really did owe Chase Manhattan the money
that Chase was trying to collect by foreclosing the mortgage
on his home. The ruling fixed Moore’s liability, and
so should Chase institute a further action in the district
court (and it not be blocked by res judicata), it is hardly
to be expected that the district judge would allow Moore
to reopen the issue of his liability to Chase. Even if res
judicata blocks a new suit to foreclose the mortgage,
moreover, interest is continuing to accrue on the note
secured by the mortgage, and Moore remains liable to Chase
not only for that interest but also on the note itself. So even
if the note is no longer secured by the mortgage (even if,
that is, a further attempt to foreclose the mortgage would
itself be foreclosed by res judicata), Chase could use the
No. 05-2941                                                    5

district judge’s liability determination to attempt future
collection of the debt owed it, including collection by means
of a suit to garnish other property owned by Moore.
   The situation is like that in In re Brown, 951 F.2d 564, 570
(3d Cir. 1991), which held that the finding that the defen-
dant in a foreclosure action was liable had collateral
estoppel effect in other proceedings even though the finding
had not yet led to a final order of foreclosure. “The Browns
were represented by counsel (in this case two separate
firms) in the state court, and hearings were held on several
occasions. The issues were genuinely contested, and the
court gave no indication that the summary judgment was
tentative or likely to be changed. When the state judge
reaffirmed the summary judgment on liability, his opinion
reflected an appreciation of the relevant facts and familiarity
with the applicable law. The summary judgment is suffi-
ciently final so that it should be given preclusive effect as to
the matters considered and decided in that phase of the
controversy between the Browns and the bank.” Citing
Brown, the Third Circuit later noted that “our decisions hold
that decisions not final for purposes of appealability may
nevertheless be sufficiently final to have issue preclusive
effect.” Greenleaf v. Garlock, Inc., 174 F.3d 352, 360 (3d Cir.
1999). That is the general rule, not anything special to the
Third Circuit. See, e.g., Mt. McKinley Ins. Co. v. Corning, Inc.,
399 F.3d 436, 443-44 (2d Cir. 2005).
  If it were certain that Chase could get no relief against
Moore, either by filing a new suit or by filing a Rule 60(b)(1)
motion, then Moore was the practical winner in the district
court, see Warner/Elektra/Atlantic Corp. v. County of DuPage,
991 F.2d 1280, 1282-83 (7th Cir. 1993), and so cannot appeal.
But as it is virtually certain that the district judge was
simply mistaken in terminating the case when and how she
6                                               No. 05-2941

did, Chase’s prospects in further proceedings in the district
court must be reckoned highly promising, in which event
Moore does have something to gain from getting the present
judgment reversed. (Among other possibilities, the district
judge might perhaps construe her judgment as having been
a declaratory judgment, allowing Chase to seek further
relief if Moore did not cave.)
  So this case really is governed by Brown, which means that
Moore has been hurt by the judgment that he seeks to
appeal, and therefore that he has standing to appeal.
Although his appeal thus is properly before us, it has no
possible merit. Yet for us to affirm the district court’s
premature judgment closing the case is to leave the dis-
pute between the parties in limbo. The Supreme Court,
however, while leaving open the question whether the
rule that a judgment cannot be altered in favor of a party
who has not appealed is jurisdictional, has described it in
emphatic terms as a settled rule and implied that there
are no exceptions. El Paso Natural Gas Co. v. Neztsosie,
supra, 526 U.S. at 480. That leaves us—because Chase did
not cross-appeal—with no choice but to affirm the judg-
ment.
                                                  AFFIRMED.
No. 05-2941                                             7

A true Copy:
       Teste:

                      _____________________________
                       Clerk of the United States Court of
                         Appeals for the Seventh Circuit

                USCA-02-C-0072—5-4-06