Court Opinion

ID: 2787611
Source: CourtListenerOpinion
Date Created: 2015-03-19 17:00:53.676865+00
Date Added: 2024-06-11T10:52:27.497807
License: Public Domain

UNPUBLISHED

                  UNITED STATES COURT OF APPEALS
                      FOR THE FOURTH CIRCUIT

                            No. 14-1785

STEPHEN F. BUZZELL; KIMBERLY B. BUZZELL,

                Plaintiffs - Appellants,

          v.

JP MORGAN CHASE     BANK,   as   Trustee;   RESIDENTIAL   FUNDING
CORPORATION,

                Defendants - Appellees.

Appeal from the United States District Court for the Eastern
District of Virginia, at Richmond.   James R. Spencer, Senior
District Judge. (3:13-cv-00668-JRS)

Submitted:   January 29, 2015               Decided:   March 10, 2015

Before NIEMEYER, SHEDD, and DUNCAN, Circuit Judges.

Vacated and remanded by unpublished per curiam opinion.

Stephen F. Buzzell and Kimberly B. Buzzell, Appellants Pro Se.
Daniel Tennyson Berger, Andrew Brian Pittman, TROUTMAN SANDERS,
LLP,   Virginia  Beach,   Virginia;  Nicholas   Richard   Klaiber,
TROUTMAN SANDERS, LLP, Richmond, Virginia, for Appellees.

Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:

              Stephen F. and Kimberly B. Buzzell filed a complaint

in the Circuit Court of Lancaster County, Virginia, against JP

Morgan Chase Bank, N.A., and Residential Funding Corporation,

alleging breach of contract and constructive fraud arising out

of   the    foreclosure       on       the    Buzzells’    residence     in   2008.      JP

Morgan      and     Residential         Funding      removed    the     action     to   the

district         court.       Residential            Funding    filed     a   notice    of

bankruptcy and the action was stayed as to Residential Funding.

The district court dismissed the action against JP Morgan as

barred      by     res    judicata,          determining   that    a    prior      decision

entered by the state court addressed the same claims against the

same parties or their privies.                   Having determined that the state

court      order    was    not     a    final    order,    we   vacate    the      district

court’s dismissal order and remand for further proceedings.

              In a previous action filed in the Circuit Court of

Lancaster County, the Buzzells alleged that GMAC Mortgage, LLC,

Homecomings Financial, Mortgage Electronic Registration Systems,

Inc.,       and     Samuel       I.      White,       P.C.,     engaged       in    fraud,

misrepresentation and breach of fiduciary duty.                         The state court

dismissed with prejudice the claims against all parties except

for one claim against Samuel I. White, which is still pending.

              “Under Virginia law, to establish res judicata, the

defendants must show:                  (1) that the prior judgment is a final

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and valid judgment; (2) that the parties are identical or are in

privity with each other; and (3) that the claim made in the

subsequent       lawsuit    arises     out     of    or     relates       to     the    same

occurrence, conduct, or transaction upon which the prior lawsuit

was based.”       Columbia Gas Transmission, LLC v. David N. Martin

Revocable Trust, 833 F. Supp. 2d 552, 558 (E.D. Va. 2011).

            The      district        court       explained          that       Virginia’s

“severable interest rule” allows for the immediate appeal of an

interlocutory       order    that    addresses        a     collateral         issue,    and

appeal of which would not affect the outcome of the remaining

issues in the case.           Thompson ex rel. Thompson v. Skate Am.,

Inc., 540 S.E.2d 123, 126 (Va. 2001).                            Under this rule, an

appeal may be taken from the interlocutory order “either at the

time of its entry or when the trial court enters a final order

disposing of the remainder of the case.”                           Id.     The district

court    reasoned    that,    because      the      state    court’s       interlocutory

order dismissing the claims against all parties except Samuel I.

White, could have been appealed and was not, it should be deemed

final.     The court concluded, “where an interlocutory order is

appealable    under    the    severable        interest          rule,   the     order   is

final.”

            We    disagree.         “[A]   judgment         is    not    final    for    the

purposes of res judicata or collateral estoppel when it is being

appealed or when the time limits fixed for perfecting the appeal

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have not expired.”          Faison v. Hudson, 417 S.E.2d 302, 305 (Va.

1992).     Additionally, the Supreme Court of Virginia has stated

that “in the absence of a statutory provision to the contrary, a

judgment is not final for purposes of appeal if it is rendered

with regard to some but not all of the parties involved in the

case.”    Wells v. Whitaker, 151 S.E.2d 422, 432 (Va. 1966).

            Here, the state court order determined by the district

court to be a final order dismissed some claims against some of

the parties.       The action is still proceeding on the Buzzells’

claim against Samuel I. White.                  Thus, the order is not a final

order for res judicata purposes.                 See Faison, 417 S.E.2d at 305.

Upon entry of judgment on the Buzzells’ claim against Samuel I.

White,   they     may   appeal     from    the    state    court’s    earlier   order

dismissing the other parties from the action.                      Thus, the state

court’s prior order is not a final order for purposes of res

judicata    and    does   not    preclude        the   Buzzells’     present    action

against JP Morgan.

            Because the district court mistakenly found that the

state    court’s    order    was    a     final    order   for    purposes     of   res

judicata, we grant leave to proceed in forma pauperis, vacate

the   district     court’s      order,     and    remand    the   case   for    future

proceedings.       We dispense with oral argument because the facts

and legal contentions are adequately presented in the materials

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before   this   court   and   argument   would   not   aid   the   decisional

process.

                                                       VACATED AND REMANDED

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