T.A. Schifsky & Sons v. Bahr Const.

• Decision Date: 22 October 2009
• Docket Number: No. A08-1295.,A08-1295.
• Citation: 773 N.W.2d 783
• Parties: T.A. SCHIFSKY & SONS, INC., Plaintiff, v. BAHR CONSTRUCTION, LLC, et al., Defendants, Consolidated Lumber Company, d/b/a Arrow Building Center, Respondent, Premier Bank, Appellant, Larson Contracting, Inc., et al., Intervening Defendants, and Premier Bank, Appellant, v. Bahr Construction & Contracting, LLC, d/b/a Bahr Construction, LLC, et al., Defendants, Consolidated Lumber Company, d/b/a Arrow Building Center, Inc., Respondent.
• Court: Minnesota Supreme Court

773 N.W.2d 783

T.A. SCHIFSKY & SONS, INC., Plaintiff, v. BAHR CONSTRUCTION, LLC, et al., Defendants, Consolidated Lumber Company, d/b/a Arrow Building Center, Respondent, Premier Bank, Appellant, Larson Contracting, Inc., et al., Intervening Defendants, and Premier Bank, Appellant, v. Bahr Construction & Contracting, LLC, d/b/a Bahr Construction, LLC, et al., Defendants, Consolidated Lumber Company, d/b/a Arrow Building Center, Inc., Respondent.

No. A08-1295.

Supreme Court of Minnesota.

October 22, 2009.

Katherine M. Melander, Stephen F. Buterin, Brian W. Varland, Coleman, Hull & Van Vliet, PLLP, Minneapolis, MN, for appellant.

Harvey N. Jones, Harvey N. Jones, P.A., Hastings, MN, for respondent.

OPINION

MEYER, Justice.

Premier Bank appeals from a district court order determining the validity of four mechanics' liens held by Consolidated Lumber Company, d/b/a Arrow Building Center (Consolidated Lumber). The district court determined the amount of the liens plus interest, and ruled that Consolidated Lumber was entitled to attorney fees, costs, and disbursements to be submitted to the court for approval. The court stated that there was no just cause for delay and directed entry of judgment. Premier Bank did not appeal from the judgment entered on December 13, 2007, but waited to appeal until after the district court awarded attorney fees in a separate order in May 2008.

The court of appeals dismissed Premier Bank's appeal as untimely because it was filed more than 60 days after the December 13, 2007, entry of judgment. We affirm as untimely the court of appeals' dismissal of Premier Bank's appeal on the validity of the mechanics' liens and the fair and reasonable value of the liens. However, because Premier Bank also appealed from the district court order awarding Consolidated Lumber its attorney fees, and because Premier Bank's appeal was filed after judgment for attorney fees was entered, we reverse the court of appeals' dismissal of Premier Bank's appeal from that order and remand to the court of appeals for further proceedings.

Consolidated Lumber sought to foreclose four mechanics' liens against Bahr Construction, LLC. Premier Bank challenged the mechanics' liens, arguing the mechanics' lien statements that Consolidated Lumber recorded with the Ramsey County Recorder's Office were invalid because they failed to describe and identify the liened premises with reasonable certainty, as required by Minn.Stat. § 514.08, subd. 2(5) (2008). The mechanics' lien statements identified the liened property as being located in section 33, Township 30, Range 22, when, in fact, the property was located in adjacent Section 34, Township 30, Range 22.

After a bench trial, the district court found that each of Consolidated Lumber's four mechanics' lien statements contained an incorrect section number and an incorrect and erroneous property identification number, but correctly identified the properties' street addresses. The court's November 26, 2007, findings of fact and conclusions of law determined that Consolidated Lumber's four mechanics' liens were valid because they identified the property with reasonable certainty as required under Minn.Stat. § 514.08, subd. 2(5). The court concluded that the fair and reasonable value of the mechanics' liens was $172,958.11, and concluded that Consolidated Lumber was entitled to interest in the sum of $12,197.10. The order further stated that "Consolidated Lumber is entitled to reasonable attorneys' fees, costs, and disbursements herein, which shall be submitted to the Court for approval by separate Notice of Motion and Motion." Although neither party had requested the court enter judgment immediately, the court concluded the order with these words: "There being no just cause for delay, let judgment be entered accordingly." Judgment was entered pursuant to the order on December 13, 2007.

Premier Bank did not file an immediate appeal, but did timely file a post-trial motion to amend the district court's findings of fact, conclusions of law, and order for judgment, and a motion for a new trial. See Minn. R. Civ.App. P. 104.01, subd. 2. The district court denied the motions on February 1, 2008. Consolidated Lumber served Premier Bank with a notice of filing of that order on February 6, 2008. See Minn. R. Civ.App. P. 104.01, subd. 1. On May 22, 2008, the district court awarded Consolidated Lumber attorney fees and costs of $11,543.74. Consolidated Lumber served Premier Bank with a notice of filing of that order on May 28, 2008; judgment on that order was entered on July 24, 2008.

On July 30, 2008, Premier Bank filed a notice of appeal that referenced both the December 13, 2007, judgment and the May 22, 2008, order, which Premier described as "a final adjudication of all remaining issues set forth in the partial judgment ... entered on December 13, 2007."¹ On August 27, 2008, after briefing by the parties, the court of appeals dismissed Premier Bank's appeal as untimely, concluding that the December 13, 2007, judgment had been immediately appealable because the order "contains the express determinations under Minn. R. Civ. App. P. 104.01 and Minn. R. Civ. P. 54.02 to allow an immediate appeal." The court concluded that Premier Bank should have appealed within 60 days of Consolidated Lumber's notice of filing of the February order denying Premier Bank's post-trial motions — in other words, by April 9, 2008.

I.

Premier Bank argues that the November 26, 2007, order was not properly certified as a final partial judgment under Minn. R. Civ. P. 54.02 because the judgment did not fully adjudicate an entire claim. Whether an order can properly be certified under Minn. R. Civ. P. 54.02 raises a legal question that requires construction and application of a procedural rule, which we review de novo. Engvall v. Soo Line R.R. Co., 605 N.W.2d 738, 741 (Minn. 2000). If an order can properly be certified, we review the district court's decision whether or not to do so for an abuse of discretion. Novus Equities Corp. v. EM-TY P'ship, 381 N.W.2d 426, 428 (Minn. 1986).

We first address whether the November 26, 2007, order could properly be certified as a final partial judgment under Minn. R. Civ. P. 54.02. "In construing procedural rules, we first look to the plain language of the rule and its purpose." Rubey v. Vannett, 714 N.W.2d 417, 421 (Minn.2006). Minnesota Rule of Civil Procedure 54.02 states:

When multiple claims for relief or multiple parties are involved in an action, the 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.

Rule 54.02 is intended to reduce piecemeal appeals by limiting appeals from judgments that resolve only part of the litigation. Engvall, 605 N.W.2d at 744. At the same time, the rule is meant to liberalize the appellate process for parties who might be prejudiced by waiting to appeal a decision where other claims or liabilities are yet to be decided. See David F. Herr & Roger S. Haydock, 2 Minnesota Practice Series: Civil Rules Annotated § 54.11 (2004).

The district court's use of Rule 54.02's language — "There being no just cause for delay, let judgment be entered accordingly" — does not necessarily make the resulting judgment a final partial judgment pursuant to Minn. R. Civ. P. 54.02.² See Brookfield Trade Ctr., Inc. v. County of Ramsey, 609 N.W.2d 868, 873 n. 6 (Minn.2000); accord Liberty Mut. Ins. Co. v. Wetzel, 424 U.S. 737, 742, 96 S.Ct. 1202, (1976). Rule 54.02 requires "multiple claims for relief or multiple parties [be] involved in an action." This court has given "claim" and "cause of action" the same meanings: "a group of operative facts giving rise to one or more bases for suing," or "the legal theory of a lawsuit." Martin ex rel. Hoff v. Rochester, 642 N.W.2d 1, 9 (Minn.2002) (citing Black's Law Dictionary 214 (7th ed.1999)). Thus, Rule 54.02 applies where the lawsuit is based on more than one legal theory or states more than one group of operative facts giving rise to relief.

In Liberty, the district court had made the requisite findings and recitation as required for partial judgments by Fed. R.Civ.P. 54(b).³ 424 U.S. at 741-42, 96 S.Ct. 1202. The United States Supreme Court, however, concluded that Fed. R.Civ.P. 54(b) does not apply to a single claim; the rule is expressly limited "to multiple claims actions in which `one or more but less than all' of the multiple claims have been finally decided and are found otherwise to be ready for appeal." 424 U.S. at 742-43, 96 S.Ct. 1202. The Court concluded a single claim was asserted; although the plaintiffs sought several types of relief, the complaint "advanced a single legal theory which was applied to only one set of facts." Id.

In a mechanic's lien foreclosure, "[j]udgment shall be given in favor of each lienholder for the amount demanded and proved, with costs and disbursements to be fixed by the court at the trial." Minn.Stat. § 514.14 (2008). We have held that those costs and disbursements may include attorney fees. Obraske v. Woody, 294 Minn. 105, 109, 199 N.W.2d 429, 432 (Minn.1972). But the amount of attorney fees is not another "basis for suing" or another "legal theory of the lawsuit." We conclude that in a mechanic's lien proceeding, where the validity and amount of the lien have been determined and the district court has ruled that the lien claimant is entitled to attorney fees, the amount of those fees is not a separate claim. Because the amount of attorney fees awarded in a mechanic's lien action is not a separate claim, Minn. R. Civ. P. 54.02 did not apply to the district court's November 26, 2007, order.⁴

II.

Having concluded that the November 26, 2007, order could not be certified as a final partial judgment under Minn. R. Civ. P. 54.02, we must decide whether the December 13, 2007, judgment...