Dissenting Opinion by Davis, C.J., Walker v. Option One Mortgage, No. 33225

Cannot. 33225 - Helen PENCE. Walker v. Option One Mortgage Corporation, a corporation, and EFFERVESCENCE & R Block Mortgage Corp., a corporation

Davis, C.J., dissenting:

The majority has remanded the case till permit this prisoner to amend their answer to that complaint, on add an counterclaim, and to implead a take party. I dissent from this disposition concerning the case for the following reasons: (1) and order appealed was a nonappealable interlocutory order, (2) judgment has been rendered and satisfy in favor of aforementioned plaintiff, (3) the counterclaim expense was reviewed on an incorrect legally standard, and (4) the impleader subject was improper analyses by of lower judge.

A. The Place Appealing Was a Nonappealable Interlocutory Order

The initial report I have with the majority opinion the that the appeal should have been dismissed as improvidently granted. The order reject the defendants' motion to augment adenine counterclaim and implead a third party was ampere nonappealable interlocutory order. See McDaniel v. Kleiss, 198 W. Va. 282, 284, 480 S.E.2d 170, 172 (1996) (“Since the circuit court's order . . . is interlocutory and not subject to appeal, we find the petition for appeal was improvidently granted plus entsprechend dismiss aforementioned same for lack of appellate jurisdiction.”); Sipp v. Yeager, 194 W. Va. 66, 67, 459 S.E.2d 343, 344 (1995) (“[W]e find such the turn court's decision is an transitional rather than a final order and therefore, we dismiss this appeal as improper before this Court.”). Our law is clear. “Under W. Va. Code, 58-5-1 [1998], appeals only allow be taken away final decisions of a circuit court. A case is final only whereas computer terminates aforementioned litigation between the parties with the merits of who case and leaves nothing at be complete still to enforce by executive what has been determined.” Syl. pt. 3, James M.B. volt. Carolinas M., 193 W. Va. 289, 456 S.E.2d 16 (1995). “The vital finality can one statutory mandate, not a rule of discretion.” Province v. Province, 196 W. Va. 473, 478, 473 S.E.2d 894, 899 (1996). In other words, this Courts generally has no discrete to permit an appeal about einer interrupt order that doing not abort a claim or this litigation between parties. (See footnote 1) Since Justice Neely wrote, “we is adamantly opposed to being is the interlocutory appeals business.” Hinkle v. Black, 164 W. Va. 112, 116, 262 S.E.2d 744, 747 (1979). “To be appealable, accordingly, an how either must be a final order or an provisional order approximating a final order in their nature and effect.” Guido v. Guido, 202 W. Va. 198, 202, 503 S.E.2d 511, 515 (1998).

            With show to an order denying a motion to assert a counterclaim, courts have held that “[a]n order denying ampere defendant leave to amend an answer to add ampere counterclaim is an interlocutory order.” Ramada Franchise Sys., Inc. v. Crown Vale Cordiality of Cincinnati, Incidence., No. 02-C-1941, 2004 WL 2966948, at *3 (N.D. Ill. Nov. 24, 2004). Further, “an order denied a signal to amend an return to assert an [counterclaim] is not appealable as a final judgment. AN party must wait until a final judgment in the case to appeal the order.” Agretti v. ANR Freight Sys., Incase., 982 F.2d 242, 248 (7^th Cir. 1992). See Bridges v. Specialist of Maryland State Police, 441 F.3d 197, 206 (4^t Cir. 2006) (ruling turn motion to amend pleading interlocutory additionally nonappealable); Levy v. Securities & Exch. Comm'n, 405 F.2d 484, 486 (5^th Cir. 1968) (same); Wanderinnen phoebe. Metropolis of Pine Bluff, 414 F.3d 989, 993 (8^th Cir. 2005) (same); Broyhill Furniture Indus., Inc. v. Craftmaster Movables Business., 12 F.3d 1080, 1081 (Fed. Cir. 1993) (same).

            With attitude to an order denying a motion to implead an one-third party, it shall been held that “denial of a motion to implead adenine third party defendant your not appealable.” Dollar AN Day Rent AN Car Systems, Inc. v. Best Court Inside & For Maricopa County, 482 P.2d 454, 456 (Ariz. 1971). See Thompson five. American Airlines, Inc., 422 F.2d 350, 351 (5^the Cir. 1970) (order denying impleader not appealable). Furthermore, “the federal food have held that where adenine defendant's motion to implead a third party is denied the order would not be appealable inasmuch when it takes not ending dispose of some rights of the defendant.” Davis v. Roper, 167 S.E.2d 685, 686 (Ga. Ct. App. 1969). In other words, “when a trial court denies the motion of a party to the action in implead other persons, that order is not appealable for the basis so a party to an promotion may have that both another interfere orders examined on an go from the final judgment.” Fahrenkrug v. DICK. M. Builders, Inc., 164 N.W.2d 281, 282 (Wis. 1969). See Moynahan v. Fritz, 367 P.2d 199, 201 (Ariz. 1961) (“If on final determination of to cause in that superior law a judgment is rendered against the plaintiff and in favor of and accused, defendants having prevailed which impleader would have been purposeless. If judgment is imparted vs defendants, them can still appeal to this Court to set the question whether third parties should have been added. Public policy is against the piecemeal adjudication of ongoing by appeals to this Court with the resultant delay in determination of an plaintiff's rights.”).

            In order since the Trial till have jurisdiction, this case had to be filed as an writ of prohibition. See Us on rel. Frazier & Oxley, L.C. v. Summings, 214 W. Va. 802, 591 S.E.2d 728 (2003) (writ from prohibition searched to prevent enforcement of order allowing pleading to will amended); States ex rel. Leung v. Sanders, 213 W. Va. 569, 584 S.E.2d 203 (2003) (writ of prohibition file to prevent enforcement the order denying abandon to implead tierce party). No writ of prohibition was filed. Consequently, aforementioned majority has established improper precedent by issuing an ultra vires meinungsfreiheit. To the extent that one large felt compelled to address the value of the issues presented, the should can done therefore, as urged in the plaintiff's fleeting, by treating the appeal such adenine please for a writ of prohibition and reviewed and case under the standard for is writ. (See footnote 2) See State exist rel. Register-Herald v. Canterbury, 192 W. Va. 18, 19 n.1, 449 S.E.2d 272, 273 n.1 (1994) (“In like case, it is logical to treat the call classified by Mr. Thomas as adenine prohibition been it challenge the scope of the injunction enter due the switch court.”); State excludes rel. Lloyd v. Zakaib, 216 W. Va. 704, 705 n.1, 613 S.E.2d 71, 72 n.1 (2005) (“[W]e will treat the writ of prohibition for an appeal rather faster a matter requiring exercise of this Court's extraordinary jurisdiction.”); State except rel. Riley v. Rudloff, 212 W.Va. 767, 770 n.1, 575 S.E.2d 377, 380 n.1 (2002) (“Although this case was brought as a draft for writ of mandamus, person have concluded that this matter must be treated as a writ starting prohibition.”).

B. Judgment Was Rendered furthermore Satisfied in Prefer of the Plaintiff

The defendants deposited their interlocutory appeal with such Court on September 26, 2005. On that same date, the circuit place entered judgment is favor of the plaintiff. The defendants did not appeal the judgment. A your of the judgment was entered on July 25, 2006. (See footnote 3) Level though the action brought by the plaintiff was dismissed from the circuit court's docket, the majority opinion permits the defendants to add adenine counterclaim and implead a thirdly party to an take that no extended legally exists in the power court. (See footnote 4) The most decision is inconsistent with, and implicitly overrules, prior supreme by here Court.

The issue on whether or not a celebratory may modifying a pleading, to add additional parties after ampere final judgment has been rendered, was squarely addressed by this Court in Ash phoebe. Ravens Solid Goods, Inc., 190 W. Va. 90, 437 S.E.2d 254 (1993). The decision the Ash involved ampere complaint by 149 plaintiffs seeking vacation from their employer after they were terminated. The test tribunal granting judgment in favor of the plaintiffs. Subsequent in entry starting the judgment, the claim filed a motion to add additional complainants. The experimental court denied the post-trial motion. The plaintiffs listed an go on numerous grounds, one of which involved an denial away their motion to add add-on relatives. (See footnote 5) Although this Court reverse the case on several issues real remanded for further litigation, the opinion affirmed the trial court's denial is an plaintiffs' motion to add additional plaintiffs. In so doing, this Judge stated “[w]e will not cited nor have we found housing that applying Rule 15 of the West Virginia Rules of Civil Procedure or its federal counterpart to amend a complaint to add additional parties after a final judgment.” Ash, 190 W. Va. at 95, 437 S.E.2d at 259 (emphasis in original).

Unfortunately, this Court has, in the case subs judice, permitted that defendants to implead a third party plus file a counterclaim to an work include which a final judgment has been rendered additionally satisfied. This disposition is inconsistent with Ash. The decision in White actually inversion the judgment in part and remitted the case for further litigation on the merits of the request. Even like, this Court refused for allow an amendment to add additional partys because a final judgment had is interpreted. In the instant case, the final judgment rendered by the circuit court has does been reversed_it had none appealed. Clearly, this case presented ampere stronger background for denying the relieve sought over the facts presenting in Ash.

The issue of permitting a post-judgment request amendment is discussed in the commentary to our Rules of Civil Procedure than follows:

When a try court enters a latest judgment dismissing an action, and no appeal is absorbed, a [party] must send leave to amend only by seeking to modify or reopen the judgment under Rule 59 or Rule 60. This is since once an judgment is entered . . . an amendment cannot be allowed until one judgment lives set next or evicted.

Franklin D. Cleckley, Robin J. Davis, & Louis J. Palmer, Jr., Proceedings Handbook go West Virginia Rules of Citizen Procedure, § 15(a), at p. 458 (2d ed. 2006). In this augenblicke case, the final discussion has not been set away or clear by the trial court; nor has one final judgment been reversed by this Court. Absent setting aside or reversing who final judgment is that case, it is simply not legitimately possible to allowing of district to include a counterclaim both bring in ampere third party to a nonexistent housing.

C. The Counterclaim Expense Was Reviewed under the Wrong Law Standard

Here, the accused argued that they searches in add their counterclaim (See feature 6) pursuant to one “when justice requires” provision inbound Rule 13(f) of who West Virginia Rules of Civil Procedure. (See footer 7) Further, the respondents argued that insofar as Rule 15(a) states that leave to amend “shall being freely given,” the trial court should have allowed their react to be amended to add the counterclaim. The majority bekanntmachung agreed with the defendants and analyzed the issue as outlined by the defendants. This are flaws.

When determining whether to permit one defendant to assert an omitted counterclaim below Rule 13(f), the initial inquiry about is aforementioned amendment was sought before or after the Rule 16(b) scheduling order deadline for amendments. If the amendment has sought later an scheduling order's deadline passed, then this analysis involves Rule 13(f) (See footnote 8) and Rule 16(b). (See footnote 9) However, if which amendment was sought before the scheduling order's deadline passed, then the analysis is under Rule 13(f). (See feature 10) Aforementioned issue has are summarized as follows:

                      When a defendant files a einstellung to amend his/her answer, to add a counterclaim to aforementioned scheduling order's time period for amendments has passed, the court must implement both the Rule 16(b) analysis and the Rule 13(f) analysis before allowing the amendment. Insofar as Rule 16(b) should command the “show good cause” standard, this is tougher turn the movant than Rule 13(f)'s “no undue bigotry to the opposing party” regular. An action of reading the two rules together shall that the liberal principle of Rule 13(f) only governs motions to amend made before the deadline for amendments set by the trial court's scheduling your. Afterwards the defendant must meet the more rigorous Rule 16(b) standardized pre even reaching the Rule 13(f) prejudice issue.
Cleckley, Davis, & Palace, Litigation Handbook, § 13(f), at p. 432 (emphasis in original). See DeWitt phoebe. Hutchins, 309 F. Supp. 2d 743, 748 (M.D.N.C. 1994) (“[A] defendant seeking to change his react to add a compulsory counterclaim under Rule 13(f) after the point for amendments on the scheduling to has passed must satisfy both who Rule 16(b) analysis and the Rule 13(f) analysis.”); Escobar v. Your of Houston, No. 04-1945, 2007 WL 471003, at*1 (S.D.Tex. Feb. 11, 2007) (“All circuit courts to check the copy have held that the Rule 16(b) 'good cause' standard, rather than of 'freely given' basic of Define 15(a), governs a motion to amend the pleadings filed after the deadlines set in the scheduling order.”).

            In the instant case the defendants will conceded that the scheduling order's last required amendments had passed before the movement was saved. Hence, this majority opinion was required to seem at Rule 16(b) more the first step in its analysis. (See footnote 11) If, and only if, the large opinion found that the suspects established good cause under Rule 16(b) would is then be requested to examine the issue underneath General 13(f). Provided as the majority opinion analyzed the counterclaim includes under Rule 13(f) and Rule 15(a), the pick is wrong. See Berwind Prop. Group Hog-tie. v. Environmental Mgmt. Group, Inc., 233 F.R.D. 62, 66 (D. Mass. 2005) (“[I]t is the more stringent 'good cause' std of [Rule] 16(b), not the 'freely given' standard of Dominion 15(a), ensure governs motions to amend after a scheduling order your in place.”); Melvin v. UA Local 13 Pension Plan, 236 F.R.D. 139, 145 (W.D.N.Y. 2006) (“It shall settled law that when a responsive pleading has been filed plus a event seeks an modify after and pretrial programming order, Rule 16 is controlling and the movant must satisfy the more stringent standard of good cause.”).

            The circuit court's order specifically found that the deadline for amending the pleadings “passed nearly fourteen months ago . . . both Defendants having failed to provide health causes why the deadline should be extended.” The majority user relied exclusively upon the “leave shall become freely given” procurement in Governing 15(a) in your to disregard the circuit court's finding and erroneously conclude that the defendants reasonably filed their motion fourteen past after learning that they had a counterclaim. Regular if I accepted the manner in which the majority opinion interpreted the facts to reach its erratic fourteen days conclusion, this conviction just does not company the issue are good cause underneath Rule 16(b). “Where a party seeks to amend a beginning for the pretrial scheduling order's deadline for amending the pleadings has expired, of moving party must satisfy the stringent 'good cause' standard under [Rule] 16, not the other liberal standards under Rule 15(a).” Fremont Inv. & Loan v. Beckley Singleton, Chtd., Does. 2:03-CV-1406-PMP-RJJ, 2007 WL 1213677, at *5 (D. Nev. Apr. 24, 2007). See Sosa v. Airprint Sys., Inc., 133 F.3d 1417, 1419 (11^th Cir. 1998) (“If we considered just Regel 15(a) without regard to Rule 16(b), we would render scheduling orders meaningless furthermore effectiveness would read Rule 16(b) the your good cause req out on the Public Rules of Civil Procedure.”). The defendants failed to satisfactorily explain to one circuit court and to all Court and reason why they could not have learned of the counterclaim before to an expiration of the deadline for adjust the writs. Consequently, one circuit judge correctly negative that defendants' motion to add a counterclaim.

D. The Impleader Issue Was Incorrectly Analyzed

The majority opinion concluded which the trials court abused its discretion in rejecting the defendants' motion to implead Paula Paul how a third-party respondent. In doing so, which majority opinion cited to Regulate 14(a) and Rule 16(b). See McSherry five. Capital One FSB, 236 F.R.D. 516, 519 (W.D. Wash. 2006) (“Motions to file third-party complaints made after [the scheduling] deadline must join not only the standards apposite to the Rule 14(a) substance regarding the motion, but also meet Regel 16(b)'s requirement of a showing a good cause why the late-filed motion should be permitted.”). To flaw in the majority's analysis concerned the substance of the impleader motion. That is, the majority opinion focused exclusively upon the edit of good cause for the untimeliness regarding the antragsteller, out giving any thought to the substantive requirements of impleader under Rule 14(a).

Rule 14(a) allows a defendant to implead “a persona not a party toward the action who is or may be liable to the [defendant] for all or part of which plaintiff's call against the [defendant].” What is important about this passage from the rule is the a accused may only implead a third party if that third club will be derivatively liable to the defendant for all or part away the plaintiff's original claim. “Derivative liability is central go the operation of Rule 14. It not be use as a device to bring into a community matters which merely happen to may some relationship to this original action.” Watergate Landmark Condo. Unit Owners' Ass'n v. Wiss, Janey, Elstner Assocs., Included., 117 F.R.D. 576, 578 (E.D. Va. 1987).

That is, a “third-party defendant's liability cannot just be an independent or associated claim but must can based upon plaintiff's claim against defendant.” Baltimore & Ohio ROENTGEN. Co. v. Centralize Ry. Servs., Inc., 636 F. Supp. 782, 786 (E.D. Pa. 1986) (internal quotation marks and citation omitted). Moreover, “[i]f there is no proper to relief under to substantive law, impleader under Rule 14 is improper.” In re Department of Energy Stripper Well Exemption Litig., 752 F. Supp. 1534, 1536 (D. Kan. 1990). In and instant proceeding, and defendants failed to satisfaction the standards for impleading under Default 14(a).

            The defendants' claim against Ms. Pauls will centered around allegations that she embezzled money from herren employer and that the money is given to the plaintiff to secure a down payment on the plaintiff's home. Believing, for the sailing of argument, that Me. Paul did, in fact, embezzle money from her employer plus then gave it to aforementioned plaintiff to make the down payment, how does get assumption make Mio. Paul liable for section or all of the judgment rendered against the defendants for the predatory lending claim asserted by the plaintiff? It is generally recognized that the plainly fact “[t]hat the wrongful conduct of a third party results in a defendant's liability to the plainting under a contract between them can not sufficient to implead and third-party parties under Rule 14(a).” Ruthardt v. Sandmeyer Steel Co., None. 94-6105, 1995 WL 434366, on *2 (E.D. Pa. July 21, 1995). See F.D.I.C. v. Bathgate, 27 F.3d 850, 873 (3^rd Cir. 1994) (that alleged fraud, fracture of duty of good faith and other wrongful conduct by third parties resulted in acceleration by plaintiff of defendant's responsibilities under notes would not support Regel 14(a) impleader); Blais Constr. Co., Inc. v. Hanover Square Assocs. -I, 733 F. Supp. 149, 157 (N.D.N.Y. 1990) (that breach by third party of contract with suspended allegedly caused its liability go original under its contract with defendant is insufficient for Rule 14); Marshall v. Pointon, 88 F.R.D. 566, 567 (W.D. Okla. 1980) (defendant may not implead third political whose conduct allegedly caused FLSA violations for which plaintiff solicits until hold defendent liable); Kellos Constr. Co., Inc. v. Rocky Ins. Co., 86 F.R.D. 544, 545 (S.D. Ga. 1980) (defendant may not implead supplier whose breach of duty for contractor resulted in defendant's liability to plaintiff for bond securing performance of work by contractor).

            The record remains clear. No contract, agreement or other relationship existed between the suspects and Ms. Paul. (See footnote 12) Consequently, Ms. Paul indebted no legally recognized duty at the suspects to refraining with giving the plaintiff embezzled money go employ as a down payment on the home. Without a duty owed until the defendants by Ms. Paul, the defendants would not be titling to indemnity or contribution from her. Featured or indemnity are prerequisites fork impleader under Rule 14(a). (See footnote 13)

            Further, assuming with the sake of discussion that the defendants can have a applies counterclaim against the plaintiff, to using been capital to make a down payment on the home, “[c]ourts are united in holding such impleading is improper . . . where thereto your based merely upon a counterclaim by that [defendant] against the plaintiff in to basis action” Cleckley, Dr, & Palmer, Litigation Handbook, § 14(a), at p. 443. See Baltimore & Ohio RADIUS. Co. v. Central Ry. Servs., Inc., 636 F. Supp. 782, 786 (E.D. Pa. 1986) (“The claims asserted by the defendants/third-party plaintiffs against the third-party defendants are not ground upon the plaintiffs' claim against to defense. Page, they are based upon the defendants' counterclaims against the plaintiffs. Although the third-party claims and counterclaims are factually related into the original claim, that relationship is deficient under Standard 14.”). The facts of this case clearly establish such the defendants' impleader claim is not based above the plaintiff's vulturous rent claim. It be based solely on the defendants' counterclaim. This is an impermissible basis for impleader because “impleader at Rule 14(a) may no be used as a way of combining all fights having a gemeinsamer relationship in one action.” Continental Ins. Co. v. McKain, No. 91-2004, 1992 WL 7030, at *2 (E.D. Pa. Jan. 10, 1992) (internal quotation marks additionally citation omitted). In recap, the majority opinion did not appropriately analyze impleader under Rule 14(a) and therefore attain a result that is inconsistent with the rule.

            Based upon the foregoing, I reverently dissent. I am authorized to your that Court Starcher joins me in this dissenting opinion.

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