Peterson v. Zerr

• Decision Date: 27 June 1989
• Docket Number: No. 880281,880281
• Citation: 443 N.W.2d 293
• Parties: Tom PETERSON, Plaintiff and Appellant, v. Kurt ZERR and Interstate Investments, a North Dakota Partnership, Defendants and Appellees, and Robert Valeu and Joe Hauer, Defendants. Civ.
• Court: North Dakota Supreme Court

Page 293

443 N.W.2d 293

Tom PETERSON, Plaintiff and Appellant, v. Kurt ZERR and Interstate Investments, a North Dakota Partnership, Defendants and Appellees and Robert Valeu and Joe Hauer, Defendants.

Civ. No. 880281.

Supreme Court of North Dakota.

June 27, 1989.

Alan C. Erickson (argued), Bismarck, for plaintiff and appellant.

Evans & Moench, Ltd., Bismarck, for defendant and appellee Kurt Zerr, argued by Dale W. Moench, Bismarck.

Bard & Bard, Bismarck, for defendant and appellee Interstate Investments, argued by Dean F. Bard, Bismarck.

LEVINE, Justice.

Tom Peterson appeals from a summary judgment which dismissed his action for tortious interference with contract and misrepresentation against Kurt Zerr and awarded Zerr attorney fees and costs. Peterson also appeals from the trial court's denial of his motion to amend his complaint to include a breach of contract claim against Interstate Investments [Interstate], the remaining defendant in Peterson's tortious interference and misrepresentation action. We hold that the Rule 54(b), N.D.R.Civ.P., order certifying the appeal of the summary judgment was improvidently granted and that the appeal from denial of the motion to amend and award of attorney fees is interlocutory. We therefore dismiss the appeal.

In 1978 Peterson and Ed Stone incorporated Golden West Travel, Inc. [Golden West]. At that time Golden West leased 1,800 square feet of property from Interstate for a 10 year term, with an option for an additional 5 years. Golden West occupied 900 square feet of the property and subleased the remaining 900 square feet to the law offices of Sperry & Erickson. In May 1981, Golden West, with the approval of Interstate, assigned the 1978 primary lease to Peterson and Stone. Peterson and Stone, in turn, sold their interests in Golden West to Kurt Zerr and Richard Grenz and subleased the property back to Golden West. In 1982 Gerald Willer purchased Grenz's interest, and in December 1984, Zerr and Willer sold Golden West to Robert Valeu, Joe Hauer, and Ron Henrickson.

In February 1985, Interstate cancelled the 1978 primary lease with Peterson and Stone, and Golden West informed Sperry & Erickson that its sublease would be terminated so the travel agency could be expanded to the entire 1,800 square feet. Golden West ultimately terminated its sublease with Peterson and vacated the premises.

Peterson brought a lawsuit against Golden West, Zerr, Valeu, Hauer, and Interstate alleging breach of contract, tortious interference with contract, and misrepresentation. The court severed the case into two separate actions. The first action consisted of Peterson's contract claim against Golden West for breach of the May 1981 sublease. The second action consisted of Peterson's claims against Zerr, Valeu, Hauer, and Interstate for tortious interference with contract and misrepresentation. Peterson and Golden West settled the breach of contract claim prior to the trial in that action. As part of that settlement, Peterson also settled all claims against Hauer and Valeu in connection with the second action for tortious interference with contract and misrepresentation.

In his complaint in the second action, Peterson asserted, among other things, that the defendants had intentionally interfered with his 1978 primary lease with Interstate, his May 1981 sublease with Golden West, and the sublease with Sperry & Erickson. Peterson also asserted that Interstate and Zerr, "jointly and severally, intentionally misrepresented the existence of lease rights and interests, and did not disclose the written sub-lease that each of them had signed, and thereby intentionally and knowingly misinformed, proximately causing substantial loss...."

Zerr moved for summary judgment dismissing all claims against him in the second action and for costs and attorney fees. The trial court granted summary judgment against Peterson and awarded Zerr costs and attorney fees in the amount of $3,456.32 under Secs. 28-26-01 and 28-26-31, N.D.C.C. Peterson then moved to defer the determination of attorney fees until after his trial with Interstate. The trial court determined this request was frivolous and awarded Zerr an additional $200 in attorney fees. Peterson also moved to amend his complaint to allege a breach of contract action against Interstate for breach of the 1978 primary lease. The trial court denied the motion.

Peterson and Zerr stipulated that there was no just reason for delay of the entry of a final judgment of dismissal. See Rule 54(b), N.D.R.Civ.P. The trial court granted the Rule 54(b) certification, and later supplemented the judgment with an "Order Clarifying Rule 54(b) Judgment," in which the court stated its reasons for granting the certification:

"1. The summary judgment in favor of defendant Zerr, dismisses a joint tort-feasor under allegations of the complaint setting forth alleged actions of Interstate Investments and Zerr, arising out of the same facts and events, involving the sale of shares and status of lease of Golden West, Inc. A trial against one of the joint tort-feasors, Interstate Investment, would not be complete and could result in further proceedings, in the event that the dismissal of defendant Zerr were reversed upon appeal. Final judgment avoids the possibility of two trials in the District Court.

"2. A review on appeal of the judgment of dismissal in favor of defendant Zerr and against the plaintiff is not likely to be avoided, should the plaintiff determine the need for an appeal, as a result of the Interstate Investment trial. That is, resolution of the case against Interstate Investment does not appear at this time to mitigate, persuade, or otherwise lend itself to encouraging the plaintiff to not appeal the judgment already entered. Accordingly, an appeal appears just as likely after the trial, as it does before the trial, leaving no reason to anticipate that a trial against Interstate Investment might avoid the need for an appeal.

"3. The issues on appeal in the judgment entered in favor of defendant Zerr do not appear to be similar, providing any efficiency on review, to any prospective issues after trial involving Interstate Investment. As such, trial against Interstate Investment, giving rise to whatever issues on appeal may be involved in that matter, would not seem to be efficiently resolved against both parties in one appeal. The two issues identified by the plaintiff on the appeal of the judgment entered, including the summary judgment dismissing the claim, and the award of attorney fees in favor of the defendant, are not prospective issues at this time after trial against Interstate Investment.

* * * * * *

"In reviewing the certification under Rule 54(b), the court has considered recent case law, and the above determination specifically includes a review of Union State Bank vs. Woell, 357 N.W.2d 234[ (1984) ]. Entry of a final judgment, appealable by the plaintiff at this time, or alternatively a waiver of appeal if not commenced within sixty days, does appear to the court at this time to be the most economical and efficient procedure, and is also the most likely among any alternative to avoid the possibility of two trials in the District Court. Entry of final judgment most assures that a trial in District Court, which includes a jury, will resolve the case against the remaining defendant, Interstate Investment, or if necessary against co-defendant, Kurt Zerr, without a possibility of remand, and two trials.

"This order clarifying the Rule 54(b) certification further recognizes the stipulation between the parties, ..."

Peterson appealed, challenging the summary judgment dismissing his claims against Zerr, the award of costs and attorney fees, and the trial court's refusal to Although Peterson and Zerr have not addressed the appealability of the district court's decisions, ¹ we may consider appealability issues sua sponte. E.g., Harmon Motors v. First Nat'l Bank & Trust, 436 N.W.2d 240, 241 (N.D.1989). We have recently summarized the interrelationship between Sec. 28-27-02, N.D.C.C., and Rule 54(b) with regard to appealability:

allow him to amend his complaint to allege a breach of contract action against Interstate.

"In Gillan v. Saffell, 395 N.W.2d 148 (N.D.1986), and Gast Construction Co. v. Brighton Partnership, 422 N.W.2d 389 (N.D.1988), we established the framework for analyzing this court's jurisdiction in cases where there is an appeal and there are unadjudicated claims remaining to be resolved by the trial court. See also Regstad v. Steffes, 433 N.W.2d 202 (N.D.1988); Matter of Estate of Stuckle, 427 N.W.2d 96, 101 (N.D.1988) (Meschke, J., concurring). In Gast Construction Co. v. Brighton Partnership, supra, 422 N.W.2d at 390, we said:

" 'First, the order appealed from must meet one of the statutory criteria of appealability set forth in NDCC Sec. 28-27-02. If it does not, our inquiry need go no further and the appeal must be dismissed. Gillan v. Saffell, supra. If it does, then Rule 54(b), NDRCivP, must be complied with. E.g., Production Credit Ass'n of Grafton v. Porter, 390 N.W.2d 50 (N.D.1986). If it is not, we are without jurisdiction. Ibid.' " Sargent County Bank v. Wentworth, 434 N.W.2d 562, 563 (N.D.1989).

MOTION TO AMEND COMPLAINT AGAINST INTERSTATE

We have previously held that an order granting or denying a motion to amend a pleading is appealable if it involves the merits of the case, and proceeded to consider the appeal without discussing the applicability of Rule 54(b). See Geo-Mobile, Inc. v. Dean Bender Chevrolet, 386 N.W.2d 918 (N.D.1986). However, Geo-Mobile, Inc. predates the "shift in our appellate procedure regarding the applicability of Rule 54(b) certification to orders that are appealable pursuant to Section 28-27-02, N.D.C.C." Harmon Motors v. First Nat'l Bank & Trust, supra, 436 N.W.2d at 241. To the extent that Geo-Mobile, Inc. appears to sanction an appeal from a denial of a motion to amend a complaint...