American Mfrs. Mut. Ins. Co. v. Edward D. Stone, Jr. & Assoc.

• Citation: 743 F.2d 1519
• Decision Date: 11 October 1984
• Docket Number: No. 83-5488,83-5488
• Court: U.S. Court of Appeals — Eleventh Circuit
• Parties: AMERICAN MANUFACTURERS MUTUAL INSURANCE COMPANY, Plaintiff-Appellant, v. EDWARD D. STONE, JR. & ASSOC., Defendant-Appellee.

Page 1519

743 F.2d 1519

40 Fed.R.Serv.2d 199

AMERICAN MANUFACTURERS MUTUAL INSURANCE COMPANY, Plaintiff-Appellant, v. EDWARD D. STONE, JR. & ASSOC., Defendant-Appellee.

No. 83-5488.

United States Court of Appeals, Eleventh Circuit.

Oct. 11, 1984.

Kimbrell, Hamann, Jennings, Womack, Carlson & Kniskern, P.A., Carlos M. Sires, James F. Crowder, Jr., Miami, Fla., for plaintiff-appellant.

Joseph W. Downs, III, Donna S. Catoe, Atty., Miami, Fla., for defendant-appellee.

Appeal from the United States District Court for the Southern District of Florida.

Before HILL and ANDERSON, Circuit Judges, and TUTTLE, Senior Circuit Judge.

R. LANIER ANDERSON, III, Circuit Judge:

In this diversity action, American Manufacturers Mutual Insurance Company ("AMMIC") appeals from the district court's imposition of a stay of proceedings pending resolution of a related state action. The appellee, Edward D. Stone, Jr. & Assoc., P.A. ("Stone"), argues that AMMIC's notice of appeal was prematurely filed and that the district court's stay order was not final and thus was not appealable under 28 U.S.C. Sec. 1291. We reject Stone's arguments and, after considering the merits of AMMIC's claim, conclude that the stay was improvidently granted under the principles of the recent Supreme Court decision in Moses H. Cone Memorial Hospital v. Mercury Construction Co., 460 U.S. 1, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983), and related cases.

I. FACTS

In June of 1977, the South Broward Park District ("Park District") contracted with Stone, a landscape architectural firm, for the design and development of a 126-acre park. On Stone's recommendation, Gold Coast Construction, Inc. ("Gold Coast"), which had filed the low bid based on plans developed by Stone, was awarded a construction contract for the subsurface and site development. AMMIC furnished payment and performance bonds for Gold Coast's portion of the project.

Gold Coast encountered difficulties in preparing the site, allegedly due to deficiencies in the Stone plans and unexpected subsurface conditions, and fell behind in its performance of the contract. In January of 1980, the Park District removed Gold Coast from the project and demanded performance by AMMIC under its bond obligation. AMMIC completed the project, and in so doing allegedly incurred costs $900,000 in excess of the contract price.

In January of 1983, State Paving, a surface contractor on the park project, and nine subcontractors, filed a state court action in Florida alleging negligence and delay in the site preparation for the project. The state action names five defendants, including the Park District, Gold Coast, Stone, and AMMIC. The Park District has filed cross-claims against its codefendants in the state action.

In April of 1983, AMMIC filed the instant diversity action in the District Court for the Southern District of Florida, alleging negligence against Stone for its preparation of the site work plans and negligence in Stone's recommendation that the Park District accept the Gold Coast bid. AMMIC originally joined the Park District in the federal action as well, alleging a failure to make timely payments to Gold Coast under the contract and a breach of the Park District's duty to timely advise AMMIC that Gold Coast was unable to complete the contract.

On July 9, 1983, the district court granted the Park District's motion to stay the federal proceeding pending resolution of the previously filed state action. In the district court's view, the state action involved "substantially similar parties and issues." AMMIC voluntarily dismissed the Park District as a party in the federal action on July 23, 1983, and simultaneously filed a motion asking the district court to lift the stay. On August 10, 1983, AMMIC filed a notice of appeal from the July 9 stay order. The district court denied AMMIC's motion to lift the stay on August 25, 1983.

II. ISSUES

The parties have presented three issues for our consideration on appeal. Stone argues: (1) that the August 10, 1983, notice of appeal was prematurely filed; and (2) that the district court's imposition of the stay was not a final order and thus was not appealable under 28 U.S.C. Sec. 1291. Finally, (3) AMMIC challenges the district court's stay order as an abuse of discretion, arguing that the stay was not justified by "exceptional circumstances."

III. DISCUSSION

A. The Timeliness of the Notice of Appeal

Stone argues that AMMIC's August 10, 1983, notice of appeal from the district court's July 9, 1983, stay order was prematurely filed and therefore ineffective. Under Fed.R.App.P. 4(a)(1), a "notice of appeal ... shall be filed with the clerk of the district court within 30 days after the date of entry of the judgment or order appealed from." Stone acknowledges that the August 10, 1983, notice of appeal came within the 30-day limit and thus complied with Rule 4(a)(1), but argues that because the district court was still considering AMMIC's motion to lift the stay when the notice of appeal was filed, we should deem the notice premature under the principles of Fed.R.App.P. 4(a)(4) and the Supreme Court decision in Griggs v. Provident Consumer Discount Co., 459 U.S. 56, 103 S.Ct. 400, 74 L.Ed.2d 225 (1982).

Fed.R.App.P. 4(a)(4) provides:

If a timely motion under the Federal Rules of Civil Procedure is filed in the district court by any party: (i) for judgment under Rule 50(b); (ii) under Rule 52(b) to amend or make additional findings of fact, whether or not an alteration of the judgment would be required if the motion is granted; (iii) under Rule 59 to alter or amend the judgment; or (iv) under Rule 59 for a new trial, the time for appeal for the parties shall run from the entry of the order denying a new trial or granting or denying any other such motion. A notice of appeal filed before the disposition of any of the above motions shall have no effect.

By its literal terms, for Rule 4(a)(4) to apply in the instant case, we must find that AMMIC's July 23, 1983, motion to lift the stay was a timely motion under one of the Federal Rules of Civil Procedure specifically mentioned in Rule 4(a)(4). To be timely, a motion under any of the above-stated rules must be filed within 10 days of the judgment or order at issue. See Fed.R.Civ.P. 50(b), 52(b), and 59. The July 23 motion was filed more than 10 days after the July 9 stay order, and thus cannot be considered a timely motion under the rules set forth in Rule 4(a)(4). See Browder v Director, Illinois Department of Corrections, 434 U.S. 257, 269, 98 S.Ct. 556, 563, 54 L.Ed.2d 521 (1978) ("Rule 4(a) follows the 'traditional and virtually unquestioned practice' in requiring that a motion be timely if it is to toll the time for appeal"). ¹ Rule 4(a)(4), by its express language, does not invalidate AMMIC's August 10 notice of appeal.

The Supreme Court decision in Griggs v. Provident Consumer Discount Co., 459 U.S. 56, 103 S.Ct. 400, 74 L.Ed.2d 225 (1982), reaffirms the policy of Fed.R.App.P. 4(a)(4). The Court in Griggs overruled a decision by the Third Circuit, which had determined that Rule 4(a)(4) need not invalidate a premature notice of appeal unless the appellee could establish prejudice from the untimely notice. In stressing a literal application of Rule 4(a)(4), the Court held that the appellant's timely Fed.R.Civ.P. 59 motion made ineffective the notice of appeal filed prior to a decision on that motion. Therefore, under the literal application of Fed.R.App.P. 4(a)(4) mandated by Griggs, AMMIC's notice of appeal in the instant case was not premature.

Stone argues that notwithstanding the precise language of Fed.R.App.P. 4(a)(4), the rationale behind the rule as stated in the Griggs decision requires us to hold that AMMIC's notice of appeal was premature. According to Griggs, the policy behind Rule 4(a)(4) is to avoid simultaneous jurisdiction over a matter in both the appellate and trial courts, i.e., when both courts have the power to modify or amend a judgment at issue. See also Gibbs v. Maxwell House, Division of General Foods Corp., 701 F.2d 145, 147 (11th Cir.1983) (discussing policy underlying Fed.R.App.P. 4(a)(4)). We acknowledge this underlying policy concern, but we also recognize that a district court will often have occasion to consider post-trial matters that might change the final judgment in a case while it is pending appeal. See Browder v. Director, Illinois Department of Corrections, 434 U.S. at 263, & n. 7, 98 S.Ct. at 560, & n. 7 (motion under Fed.R.Civ.P. 60(b) for relief from judgment does not toll the time for appeal from the original judgment). See generally, 7 J. Moore, Federal Practice p 60.29, 413-14 (1975). Rule 4(a)(4) does not address these situations, but is instead limited in its operation "to the filing of certain specified post-trial motions." Note of Advisory Committee on Appellate Rules, 28 U.S.C.A. following Rule 4 (emphasis supplied). Just as Fed.R.App.P. 4(a)(4) does not apply to motions under Fed.R.Civ.P. 60(b), even though the district court can, under 60(b), alter its final judgment, untimely post-judgment motions do not toll the time for appeal under Rule 4(a)(4).

We conclude that AMMIC's notice of appeal was timely filed.

B. Appealability of the Stay Order

Stone further argues that the district court's stay order was not appealable under 28 U.S.C. Sec. 1291. That section provides:

The court of appeals ... shall have jurisdiction over all final decisions of the district courts of the United States ... except where a direct review may be had in the Supreme Court.

Stone argues that the district court's decision to stay the federal proceedings was not a final decision within the meaning of the statute because the lower court retained jurisdiction for later disposition of the merits of AMMIC's claim. See generally, Moses H. Cone Memorial Hospital v. Mercury Construction Corp., 460 U.S. 1, 103 S.Ct. 927, 934 n. 11, 74 L.Ed.2d 765 (1983) ("a stay is not ordinarily a final...