Budinich v. Becton Dickinson and Co.

Decision Date12 December 1986
Docket NumberNo. 84-2192,84-2192
PartiesJoseph G. BUDINICH, Plaintiff-Appellant, v. BECTON DICKINSON AND COMPANY, a foreign corporation, Defendant-Appellee.
CourtU.S. Court of Appeals — Tenth Circuit

William S. Finger of Nicholls, Kusic, Frank & Finger, Evergreen, Colo., for plaintiff-appellant.

Terre Lee Rushton of Kelly, Haglund, Garnsey & Kahn, Denver, Colo., for defendant-appellee.

Before McKAY, SETH and TACHA, Circuit Judges.

PER CURIAM.

In accordance with 10th Cir.R. 9(e) and Fed.R.App.P. 34(a), this appeal came on for consideration on the briefs and record on appeal.

This action arises out of an employment contract under which plaintiff served as defendant's western regional manager for a salary plus commission on sales. Prior to plaintiff's completion of a major sale to the United States Air Force, defendant's commission structure was modified, resulting in a substantial reduction in the commission ultimately paid to plaintiff. Although he protested, plaintiff continued his employment with defendant. Sometime later, and shortly before an order for spare parts and a supplemental purchase order were placed by the Air Force, defendant terminated plaintiff's employment.

Plaintiff initially brought this diversity action asserting claims for breach of contract, quantum meruit, misrepresentation, and outrageous conduct. Following a lengthy procedural course, during which plaintiff's claims were revised somewhat as a result of the district court's grant of partial summary judgment for defendant, the case was tried to a jury, which found for defendant on plaintiff's misrepresentation and implied contract (for commission on the spare parts order) claims but awarded plaintiff $5,000 on an implied contract theory regarding the supplemental purchase order.

The district court entered judgment on the verdict on March 26, 1984. Plaintiff timely filed an original and an amended new trial motion challenging various substantive rulings by the district court, as well as a motion for attorney's fees. On May 16, 1984, the new trial motions were disposed of, but the district court reserved determination of the amount of attorney's fees to be awarded to plaintiff. The district court ultimately issued its final order regarding the fees issue on August 2, 1984, and plaintiff filed his sole notice of appeal from the court's post-trial orders on August 29, 1984.

Defendant has moved for summary dismissal of this appeal as untimely, relying on the principle we first announced in Cox v. Flood, 683 F.2d 330 (10th Cir.1982). In Cox and several later cases, this court held that judgments finally disposing of the merits are appealable even though questions relating to attorney's fees have been left undecided. Id. at 331; see, e.g., Art Janpol Volkswagen v. Fiat Motors, 767 F.2d 690 (10th Cir.1985); cf. Dataq, Inc. v. Tokheim Corp., 736 F.2d 601 (10th Cir.1984). Accordingly, an appeal on the merits must be filed within the requisite time period following entry of final judgment thereon, notwithstanding that a motion for attorney's fees may be pending. See West v. Keve, 721 F.2d 91 (3d Cir.1983); Smillie v. Park Chemical Co., 710 F.2d 271 (6th Cir.1983). Since plaintiff did not file a notice of appeal from the district court's May 16, 1984, order disposing of his new trial motions until August 29, 1984, when he appealed the district court's award of $1,000 in attorney's fees, defendant contends that the former appeal must be dismissed as untimely.

Plaintiff seeks to avoid the effect of the authorities cited by arguing that, unlike our previous decisions, the present case involves a situation where attorney's fees are an inherent part of the relief sought and, consequently, must be determined before the judgment on the merits can be considered final. While there is some authority for the type of situational approach advocated by plaintiff, see F.H. Krear & Co. v. Nineteen Named Trustees, 776 F.2d 1563 (2d Cir.1985); McQurter v. Atlanta, 724 F.2d 881 (11th Cir.1984); Holmes v. J. Ray McDermott & Co., 682 F.2d 1143 (5th Cir.1982), cert. denied, 459 U.S. 1107, 103 S.Ct. 732, 74 L.Ed. 956 (1983), we believe the better course is followed in those circuits which treat all attorney's fees motions as procedural equivalents and uniformly require separate notices of appeal when such motions are resolved after judgment has been rendered on the merits. See Exchange National Bank v. Daniels, 763 F.2d 286 (7th Cir.1985); Morgan v. Union Metal Manufacturing, 757 F.2d 792 (6th Cir.1985); International Association of Bridge, etc., Local Union 75 v. Madison Industries, Inc., 733 F.2d 656 (9th Cir.1984); West v. Keve, supra.

A uniform, unqualified rule is especially appropriate in the present context for several reasons. First, the de facto, case-by-case analysis required by the situational approach, and the consequent uncertainty it would promote until an inclusive and coherent set of principles could be worked out, is particularly unsuited to a jurisdictional rule that requires forfeiture of an appeal for noncompliance. See Daniels, supra at 293; 15 C. Wright, A. Miller & E. Cooper, Federal Practice and Procedure Sec. 3915 at 398-401 (Supp.1985); see also Alcorn County v. U.S. Interstate Supplies, Inc., 731 F.2d 1160, 1165 n. 4 (5th Cir.1984) (Fifth Circuit acknowledging the difficulties its situational approach may cause litigants). Second, to be consistent, those courts holding that under particular circumstances fees are an integral part of the judgment, which is therefore not final until the matter of fees is resolved, must also hold that motions relating to such fees are, in effect, motions to alter or amend judgment and thus subject to the time constraints of Fed.R.Civ.P. 59(e). This result however, cannot be endorsed in light of the Supreme Court's analysis and decision in White v. New Hampshire, 455 U.S. 445, 102 S.Ct. 1162, 71 L.Ed.2d 325 (1982) (holding Rule 59(e) inapplicable to requests for fees under 42 U.S.C. Sec. 1988). Of course, the White holding specifically applies only to Sec. 1988 requests, but nothing in the opinion indicates that motions seeking fees pursuant to other authority should be treated any differently. See id. at 450-55, 102 S.Ct. at 1165-68. Third, divining the degree of relationship between attorney's fees and the compensation sought in any particular case is a procedure of uncertain design and questionable validity. The Third Circuit has expressed this concern in more specific terms:

We reject as altogether too metaphysical the distinction between fees that are "compensation for injury" and those that are not. All awards of fees make the prevailing party better off. Whether this benefit is "really" a way to compensate for the underlying hurt or instead a way to reduce the cost of litigation, thus making redress of the underlying hurt more likely and leaving the prevailing party with a greater net award, is a question of semantics rather than substance. Resolution of this question would depend on the legislative (or bargaining) history of a given statute or contract--if indeed such a question ever has a sensible answer.

Daniels, supra at 294. Finally, we note that the adoption of a per se rather than situational approach is certainly consistent with, if not compelled by, this court's unqualified holdings in prior decisions. See, e.g., Cox, supra at 331 ("judgments finally disposing of the merits are appealable even though questions relating to attorney's fees have been left undecided"); Clulow v. Oklahoma, 700 F.2d 1291, 1293 n. 1 (10th Cir.1983) ("outstanding motions for fee awards are no longer to be considered as affecting the finality and appealability of decisions on the merits").

Plaintiff also argues that, since this is a diversity action, the rule of Erie Railroad Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938), precludes the application of the principles developed by this court in Cox and subsequent cases. In plaintiff's view, the law of Colorado, the forum state, which...

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