Engvall v. Soo Line RR Co.

• Decision Date: 17 February 2000
• Docket Number: No. C6-99-64.,C6-99-64.
• Citation: 605 N.W.2d 738
• Parties: James J. ENGVALL, Plaintiff, v. SOO LINE RAILROAD COMPANY, d/b/a Canadian Pacific Railway Company, defendant and third-party plaintiff, petitioner, Appellant, v. General Motors Corporation, a foreign corporation, third-party defendant, Respondent.
• Court: Minnesota Supreme Court

605 N.W.2d 738

James J. ENGVALL, Plaintiff, v. SOO LINE RAILROAD COMPANY, d/b/a Canadian Pacific Railway Company, defendant and third-party plaintiff, petitioner, Appellant, v. General Motors Corporation, a foreign corporation, third-party defendant, Respondent.

No. C6-99-64.

Supreme Court of Minnesota.

February 17, 2000.

Eric J. Magnuson, Jeffrey R. Schmidt, Peter Gray, Rider, Bennett, Egan & Arundel, LLP, Minneapolis,for appellant.

Mickey W. Greene, Hanson, Marek, Bolkcom & Greene, Ltd., Minneapolis, Thomas J. Sweeney, Mark E. Gebauer, Eckert, Seamans, Cherin & Mellott, LLC, Harrisburg, PA, for respondent.

Heard, considered, and decided by the court en banc.

OPINION

PAUL H. ANDERSON, Justice.

Appellant Soo Line Railroad Company challenges the Minnesota Court of Appeals' dismissal of its appeal from a final judgment of the Hennepin County District Court. Before entering final judgment, the district court had granted respondent General Motors Corporation's (GM) motion for summary judgment on the grounds of federal preemption. The court of appeals characterized the grant of summary judgment as an immediately appealable interlocutory judgment that was based on a lack of subject matter jurisdiction. The court of appeals then held Soo Line's appeal untimely because it appealed from the final judgment rather than the summary judgment. We reverse.

In the early morning hours of November 6, 1996, plaintiff James Engvall allegedly was injured while tying down, or applying, a handbrake on an SD-60 locomotive in the scope of his employment with Soo Line. In March 1997, Engvall commenced an action against Soo Line alleging that while he was using a handwheel to apply the handbrake, the mechanism slipped, causing his back injury. In his complaint, Engvall asserted that Soo Line had been negligent under the Federal Employers' Liability Act (the FELA), 45 U.S.C. §§ 51-60 (1997), and the Locomotive Inspection Act ((the LIA), formerly known as the Boiler Inspection Act (BIA)), 49 U.S.C. §§ 20701-20703 (1997).¹

Soo Line answered Engvall's complaint and, in turn, filed a third-party complaint against GM, the locomotive's manufacturer. In its third-party complaint, Soo Line asserted state common law claims, specifically alleging that GM failed to use reasonable care in designing and manufacturing the locomotive's handbrake, thereby rendering the handbrake defective and unreasonably dangerous. Soo Line claimed that under Minnesota law it would be entitled to contribution and indemnity from GM if Engvall recovered from Soo Line.

In its amended answer to Soo Line's third-party complaint, GM raised the affirmative defense that federal law preempted Soo Line's state common law contribution and indemnification claims. GM moved for summary judgment on the basis of this defense. By an order dated July 28, 1998, the district court granted GM's motion, concluding that the LIA preempted Soo Line's state claims against GM. Judgment was entered on August 13, 1998 on Soo Line's third-party complaint. Because claims involving other parties remained pending, this was an interlocutory rather than final judgment.

Two months later, in October 1998, all of Engvall's claims against Soo Line were dismissed pursuant to a stipulation. Final judgment was entered on October 12, 1998. Soo Line then filed a notice of appeal with the court of appeals on January 8, 1999 contesting the district court's dismissal of its claims against GM. The court of appeals questioned whether Soo Line's appeal was timely. The court asked both GM and Soo Line to respond to specific questions regarding whether grants of summary judgment based on federal preemption are immediately appealable.

After receiving responses from both parties, the court of appeals concluded that when the district court granted GM's summary judgment motion based on federal preemption, the district court "in effect ruled that [the court] lacked subject-matter jurisdiction to hear [Soo Line's] third-party claims because federal law totally occupies the field." Soo Line R.R. Co. v. General Motors Corp., No. C6-99-64 (Minn.App. Mar. 16, 1999). The court of appeals went on to conclude that dismissal for lack of subject matter jurisdiction is immediately appealable even when the district court does not expressly determine, pursuant to Minn. R. Civ. P. 54.02, that there is no just reason for delay to allow an immediate interlocutory appeal. The court then reasoned that because the time to appeal began to run on August 13, 1998, the date that the interlocutory judgment dismissing GM was entered, the time to appeal expired 90 days later, on November 12. See Minn. R. Civ.App. P. 104.01 (1998).² Accordingly, the court held Soo Line's January 8, 1999 appeal untimely.

In reaching its conclusion that the district court order granting GM's summary judgment motion was immediately appealable, the court of appeals relied on our opinion in McGowan v. Our Savior's Lutheran Church, 527 N.W.2d 830 (Minn. 1995), and its own opinion in Semiconductor Automation, Inc. v. Lloyds of London, 543 N.W.2d 123 (Minn.App.1996), rev. denied (Minn. Mar. 19, 1996). On appeal to this court, Soo Line primarily argues that the court of appeals incorrectly concluded that federal preemption always results in lack of subject matter jurisdiction. Soo Line also asserts that the court of appeals erred by holding (1) that an interlocutory summary judgment based on lack of subject matter jurisdiction is appealable absent an express Rule 54.02 determination, and (2) that such an appeal is mandatory.

We begin our analysis by focusing on Soo Line's argument concerning Rule 54.02 and the two procedural issues raised by this argument. The first procedural issue raised by Soo Line is whether a summary judgment motion that is granted based on a lack of subject matter jurisdiction is immediately appealable absent an express Rule 54.02 determination. The second issue is whether appeal from an immediately appealable interlocutory judgment is permissive rather than mandatory. With respect to this second issue, mandatory means that if the appeal is not taken from an interlocutory ruling, the right to appeal the ruling is lost, while permissive means that a party who is authorized to take an interlocutory appeal has the option to appeal the ruling immediately or to wait to appeal from the final judgment. These two issues raise legal questions that require construction of a procedural rule, which is subject to de novo review. See State v. Nerz, 587 N.W.2d 23, 24-25 (Minn. 1998)

.

There are two main sources of authority critical to our analysis. First, we look to Minn. R. Civ. P. 54.02, which governs judgments involving multiple parties or multiple claims. Second, we look to caselaw that has shaped our policy toward interlocutory appeals. More particularly, in McGowan we discussed the reasons why some interlocutory orders or judgments are immediately appealable and cited to cases discussing the collateral order doctrine. See McGowan, 527 N.W.2d at 830, 832

(citing Mitchell v. Forsyth, 472 U.S. 511, 524-25, 105 S.Ct. 2806, 86 L.Ed.2d 411 (1985); Anderson v. City of Hopkins, 393 N.W.2d 363, 363-364 (Minn.1986)). Then in Shorewood v. Metropolitan Waste Control Comm'n, we addressed the practical dilemmas appellants often face in deciding when and from what to appeal. 533 N.W.2d 402 (Minn.1995).

Minnesota Rules of Civil Procedure 54.02 governs judgments in actions that involve multiple parties or multiple claims. The rule provides that a district court

may direct the entry of a final judgment as to one or more but fewer than all of the claims or parties only upon an express determination that there is no just reason for delay and upon an express direction for the entry of judgment. In the absence of such determination and direction, any order or other form of decision, however designated, which adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties shall not terminate the action as to any of the claims or parties, and the order or other form of decision is subject to revision at any time before the entry of judgment adjudicating all the claims and the rights and liabilities of all the parties.

Minn. R. Civ. P. 54.02 (emphasis added).

We have stated that the purpose of Rule 54.02 is "to prevent piecemeal, interlocutory appeals and possible prejudice from the adjudication of less than all claims involved." Novus Equities Corp. v. EM-TY Partnership, 381 N.W.2d 426, 428 (Minn.1986). Nevertheless, the district court has discretion under the rule to allow these types of appeals by making "an express determination that there is no just reason for delay" and "an express direction for the entry of judgment." Minn. R. Civ. P. 54.02; see also Novus, 381 N.W.2d at 428

.

In McGowan, we considered whether an order denying summary judgment is immediately appealable when a party sought dismissal based on lack of subject matter jurisdiction. See McGowan, 527 N.W.2d at 830

. We first noted that the denial of such a motion is generally not appealable absent the district court's certification of the question as "important and doubtful" pursuant to Minn. R. Civ.App. P. 103.03(h). See McGowan, 527 N.W.2d at 832. Rule 103.03 provides a general rule for which orders and judgments are appealable.³ However, we then articulated an exception to this general rule. See id. at 832-33. In doing so, we acknowledged that immediate appeals are allowed when a district court denies a summary judgment motion for either lack of personal jurisdiction or government immunity, even absent Rule 103.03(h) certification. See McGowan, 527 N.W.2d at 832-33 (citing Anderson, 393 N.W.2d at 364; Hunt v. Nevada State Bank, 285 Minn. 77, 88-89, 172 N.W.2d 292, 300 (1969)).

The rationale for these exceptions is that determinations of lack of personal jurisdiction and governmental immunity are determinations of rights whereby "a defendant is compelled...