807 F.2d 1279 (6th Cir. 1986), 85-5997, Corrosioneering, Inc. v. Thyssen Environmental Systems, Inc.

Docket Nº:CORROSIONEERING, INC., Plaintiff-Appellant (85-5997),
Citation:807 F.2d 1279
Case Date:December 15, 1986
Court:United States Courts of Appeals, Court of Appeals for the Sixth Circuit
 
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Page 1279

807 F.2d 1279 (6th Cir. 1986)

CORROSIONEERING, INC., Plaintiff-Appellant (85-5997),

and

The Continental Insurance Company, Third-Party

Complainant-Appellant (85-5998),

v.

THYSSEN ENVIRONMENTAL SYSTEMS, INC., Federal Insurance

Company, Continental Insurance Company, Ashland

Chemical Company and Berton Plastics,

Inc., Defendants-Appellees.

Nos. 85-5997, 85-5998.

United States Court of Appeals, Sixth Circuit

December 15, 1986

Argued Aug. 15, 1986.

Page 1280

Thomas R. Yocum (argued), Benjamin, Faulkner, Tepe and Sack, Cincinnati, Ohio, for Corrosioneering, Inc.

Leslie W. Morris, II (argued), Lexington, Ky., Robert B. Cetrulo (argued), Covington, Ky., for defendants-appellees.

J.W. Smirz, Landrum, Shouse and Patterson, Lexington, Ky., for Continental Ins. Co.

Before JONES and NELSON, Circuit Judges, and CELEBREZZE, Senior Circuit Judge.

Page 1281

CELEBREZZE, Senior Circuit Judge.

Plaintiff-appellant Corrosioneering, Inc. ("Corrosioneering") and its bonding company, Continental Insurance Company ("Continental"), appeal from the district court's dismissal of their third-party complaint against Ashland Chemical Company ("Ashland") and Berton Plastics, Inc. ("Berton"). On appeal, Corrosioneering and Continental argue that the district court erred in finding that no express or implied warranties were created in connection with the sale of goods by Ashland and Berton to Corrosioneering. Finding that this case was improperly certified under Fed.R.Civ.P. 54(b), we dismiss the appeal.

The facts relevant to this appeal are not in dispute. Eastern Kentucky Power Cooperative was building a power plant near Maysville, Kentucky called the Spurlock Power Plant ("the Spurlock project"). Part of the Spurlock project was a scrubber system on which Thyssen Environmental Systems, Inc. ("Thyssen") was the contractor. Thyssen, in turn, subcontracted with Corrosioneering for the installation of a corrosion resistant lining in portions of the scrubber system. The lining system installed by Corrosioneering, developed by Corrosioneering's president, Mr. Dennis Newton, had as primary components several polyester resins which had been manufactured by Ashland and which had been purchased by Corrosioneering directly from Ashland or from Berton, a distributor.

The lining system subsequently failed, however, and Thyssen refused to pay Corrosioneering. After Corrosioneering brought an action against Thyssen and Thyssen's bonding company, Federal Insurance Company ("Federal"), for nonpayment, Thyssen and Federal responded by filing a counterclaim against Corrosioneering and Continental alleging that Corrosioneering was liable for installing a defective lining system. Corrosioneering and Continental then filed a third-party complaint against Ashland and Berton, contending that Ashland and Berton had breached both express and implied warranties in the sale of the polyester resins used in the lining system, and seeking indemnification in the event Corrosioneering and Continental were found liable to Thyssen.

The district court held a bench trial on Thyssen's counterclaim and Corrosioneering's third-party complaint. The court determined that Corrosioneering was liable to Thyssen for installing the defective lining, but concluded that neither Ashland nor Berton had made any express or implied warranties to Corrosioneering. The issue of damages and several miscellaneous matters were not resolved by the district court, however, but were referred to a magistrate. Subsequently, the district court rendered a final judgment in favor of Ashland and Berton, dismissing the third-party complaint of Corrosioneering and Continental, and certified for immediate appeal under Rule 54(b) 1 the issue of whether Ashland and Berton had made any express or implied warranties to Corrosioneering during the sale of the resins. Consequently, the question of whether Corrosioneering may be entitled to indemnification from Ashland or Berton is the only substantive issue presently before this court. 2

Although the parties have focused on the creation of warranties as dispositive of this appeal, we are required in the first

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instance to consider the propriety of the district court's Rule 54(b) certification. This court obtains jurisdiction only when an appeal is taken from a final order, 28 U.S.C. Sec. 1291 (1982), or from an appealable interlocutory order, 28 U.S.C. Sec. 1292 (1982). See Sears, Roebuck & Co. v. Mackey, 351 U.S. 427, 431, 76 S.Ct. 895, 897, 100 L.Ed. 1297 (1956). Although Rule 54(b) provides a means by which a district court may release for immediate appeal final decisions resolving "one or more but fewer than all of the claims or parties" in a multiple-claim or multiple-party action, Fed.R.Civ.P. 54(b), it does not empower the district court to "treat as 'final' that which is not 'final' within the meaning of Sec. 1291." Mackey, 351 U.S. at 437, 76 S.Ct. at 900. Thus, if the district court's certification was improper, we are without jurisdiction to consider the merits of this appeal. See Solomon v. Aetna Life Insurance Co., 782 F.2d 58, 59-60 (6th Cir.1986); Allis-Chalmers Corp. v. Philadelphia Electric Co., 521 F.2d 360, 362-63 (3d Cir.1975); B.B. Adams General Contractors, Inc. v. Department of Housing and Urban Development, 501 F.2d 176, 177 (5th Cir.1974).

Rule 54(b) was a response to the need created by the liberal joinder provisions of the Federal Rules of Civil Procedure to revise "what should be treated as a judicial unit for purposes of appellate jurisdiction." Mackey, 351 U.S. at 432, 76 S.Ct. at 897. The rule was "designed to facilitate the entry of judgment on one or more claims, or as to one or more parties, in a multi-claim/multi-party action," Solomon, 782 F.2d at 60; Allis-Chalmers, 521 F.2d at 363, "where the parties demonstrated a need for making review available on some of the claims or parties before entry of final judgment as to all," COMPACT v. Metropolitan Government of Nashville &amp...

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