Resnik v. La Paz Guest Ranch

• Decision Date: 12 April 1961
• Docket Number: 16836.,No. 16835,16835
• Citation: 289 F.2d 814
• Parties: Charles RESNIK, Appellant, v. LA PAZ GUEST RANCH, Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

289 F.2d 814 (1961)

Charles RESNIK, Appellant, v. LA PAZ GUEST RANCH, Appellee.

Nos. 16835, 16836.

United States Court of Appeals Ninth Circuit.

April 12, 1961.

Emanuel Cowitt, Los Angeles, Cal., Jack I. Esensten, Inglewood, Cal., for appellant.

Theodore J. Elias, Harold Easton, Leo S. Rich, Los Angeles, Cal., for appellee.

Before BARNES, HAMLIN and MERRILL, Circuit Judges.

BARNES, Circuit Judge.

The necessary jurisdiction below is in issue in this case. Appellant asserts federal diversity jurisdiction under 28 U.S. C. § 1332. Several appeals are taken (a) from an order of the district court vacating a partial summary judgment and (b) from a further order of the same court dismissing appellant's action. Jurisdiction on appeal rests on 28 U.S.C. § 1291.

Appellant in 1958 filed in the United States District Court for the Southern District of California an action on a promissory note, in count one, and for money had and received, an open book account and an account stated in counts two, three and four. The complaint alleged, inter alia, that appellee had, on or about September 1, 1954, executed and delivered to appellant a promissory note for $30,463.85. A partial summary judgment in favor of appellant on count one was entered on August 29, 1958. A writ of execution was then issued and pursuant thereto, the United States Marshal levied upon certain real property belonging to appellee. No sale, however, was held and on July 23, 1959, appellee, apparently proceeding under Fed.R.Civ.P. 60(b) (2) and (3), 28 U.S.C.A. moved to set aside the summary judgment. Appellee claimed that newly discovered evidence disclosed the federal court did not have jurisdiction in the matter, because there existed no diversity of citizenship among the parties. On September 22, 1959, the court entered an order setting aside the judgment. The court expressly stated that it was not then passing upon the question of federal jurisdiction, although it specifically granted appellee leave to move for dismissal because of lack of jurisdiction. The sole grounds for the order vacating judgment were appellant's failure to appear for the taking of a deposition after proper notice had been served upon him, and appellant's failure on two occasions to appear before the Court, pursuant to court orders which had been communicated to him. On October 9, 1959, appellant filed a notice of appeal from the above described order vacating judgment.

On November 20, 1959, appellee filed notice of its motion to dismiss appellant's entire action in the district court on the ground that that court had no jurisdiction over it. On November 24, 1959, appellant dismissed counts two, three and four. On January 20, 1960, the district court entered a judgment dismissing appellant's first cause of action for lack of jurisdiction and also because of appellant's failure to prosecute the action. Appellant, of course, has appealed from this judgment of dismissal.

Thus this case presents two appeals. One involves an order setting aside the original summary judgment in favor of appellant; the other is concerned with the subsequent judgment dismissing appellant's action. Appellant has filed identical opening briefs for both appeals; and in argument generally both sides have treated the two appeals as though they were combined, as will we.

Appellant asserts: (1) that appellee was not, under the circumstances, entitled to raise the question of lack of jurisdiction; (2) that the court could not properly vacate a judgment simply because of a litigant's refusal to comply with the court's orders; (3) that the trial court had no power to dismiss his action when an appeal was pending in this court; (4) that there actually was adequate diversity of citizenship which precluded a dismissal of the action.

(1) Was appellee entitled to raise the question of lack of jurisdiction? Appellant contends that appellee's admission of the jurisdictional facts in the original pleadings precluded appellee, by waiver and estoppel, from later challenging the court's jurisdiction. This argument is clearly without merit. Generally lack of jurisdiction allegedly based upon diversity of citizenship can be raised in the trial court "at any time." Page v. Wright, 7 Cir., 1940, 116 F.2d 449, 451, petition for certiorari dismissed, 312 U.S. 710, 61 S.Ct. 831, 85 L.Ed. 1142. It is true that the jurisdictional issue cannot, normally, be raised by collateral attack. McCormick v. Sullivant, 10 Wheat. 192, 23 U.S. 192, 6 L.Ed. 300, but see Note: Collateral Challenge to Jurisdiction, Hart & Wechsler, The Federal Courts and the Federal System, p. 724. The challenge to the judgment in this instance, however, is specifically authorized by Rule 60(b) (2),¹ Fed.R.Civ.P., and was raised within the time permitted by that Rule. (Rule 60(b).) As required by the Rule, appellee alleged that newly discovered evidence, which with due diligence could not have been discovered before trial, demonstrated the court's lack of jurisdiction.

Appellee was, then, expressly authorized to raise the jurisdictional question in the manner in which it did so, and appellee was clearly not estopped from raising the question by any prior pleadings or admissions in the case. Page v. Wright, supra.

Appellant cites authority for the proposition that a court's determination regarding jurisdiction over the subject matter is final, res judicata, and not subject to collateral attack. Cf. Stoll v. Gottlieb, 305 U.S. 165, 59 S.Ct. 134, 83 L.Ed. 104. The cited cases represent good law, but they have nothing to do with a court's power under Rule 60 to vacate or set aside a judgment. Appellant further relies on a portion of Professor Moore's treatise (7 Moore, Federal Practice 269 (2d ed. 1955)), but again the citation is inappropriate. The material cited by appellant refers exclusively to Rule 60(b) (4), dealing with void judgments, and not to Rule 60(b) (2) and (3), the provisions which are here of concern.

(2) Appellant in his first appeal complains of the court's vacating the summary judgment — such action cannot, appellant asserts, be taken for the reasons relied on by the trial court.

Before coming to the merits of this point raised by appellant, there is a preliminary question which neither side has considered, but which was raised by this court on oral argument. The order vacating the summary judgment is an interlocutory order, and hence, nonappealable. It does not finally dispose of the case. Indeed, the order expressly contemplated further proceedings with respect to jurisdiction, and it specifically reserved the jurisdictional question (p. 2 of Order Setting Aside Judgment) for subsequent decision. A decision which leaves some matter in controversy open for future determination before the rights of the parties are conclusively adjudicated is interlocutory and not final. Beighlee v. Le Roy, 3 Cir., 1930, 94 F.2d 30. Indeed, it has been specifically held that an order vacating a judgment under rule 60(b) is interlocutory and nonappealable. Stathatos v. Arnold Bernstein S.S. Corp., 2 Cir., 1953, 202 F.2d 525. See also 7 Moore, Federal Practice 342 (2d ed. 1955). In Board of Supervisors of Rockland County v. Knickerbocker Ice Co., 2 Cir., 1935, 80 F.2d 248, the court noted that there exists an exception to the general rule just stated. When the motion to vacate is made after expiration of the term at which the judgment was rendered, the motion is viewed as a new proceeding which is concluded by the order. See also Mohonk Realty Corp. v. Wise Shoe Stores Inc., 2 Cir., 1940, 111 F.2d 287, 289, note 1. The vitality of this exception seems to have been diminished, if not extinguished, by the adoption of Rule 6(c), which provides that the expiration of a term of court does not affect a court's power to do any act or take any proceeding in any civil action which has been pending before it. In any event, the burden is upon appellant to demonstrate that the order appealed from is final and that this court has jurisdiction of the appeal. Ninth Circuit Rule 18, subd. 2(b), 28 U.S.C.A. And appellant has here asserted no facts or argument that would bring him within the above described exception to the general rule of the Rockland case. The appeal from the order setting aside the judgment (No. 16835 in this court) should be dismissed for lack of jurisdiction in this court. A court of appeals, of course, is "bound to refuse sua sponte to assume jurisdiction not conferred upon it." Bass v. Baltimore & Ohio Term. R. Co., 7 Cir., 1944, 142 F.2d 779, 780, certiorari denied 323 U.S. 775, 65 S.Ct. 135, 89 L.Ed. 619.

If this court should reach the merits of the appeal from the order vacating the judgment, then, the trial court's action must be affirmed. Appellee's motion to set aside the summary judgment raised a serious question regarding the court's jurisdiction in this matter. It was, then, important to determine as expeditiously as practicable, the actual facts regarding the alleged lack of diversity of citizenship among the litigants. Appellant's uncooperative behavior, specifically described in the Order Setting Aside Judgment, hindered the necessary inquiry. Appellant asserts that he was not required to appear just because appellee wanted him there. But as the order specifically states, it was the court's orders, not the appellee's wishes, which appellant refused to comply with. Assuming a serious question with respect to the court's jurisdiction to render the original judgment, and given, further, appellant's sustained refusal to aid in resolving that question, the court was justified — and certainly it did not abuse its discretion — in vacating the judgment. Such action merely paved the way for an orderly determination of the jurisdictional question.

Appellant asserts that appellee "disposed of all of its assets which were the subject matter of the litigation," and that therefore it could not move to vacate the judgment against it. The short...