Case in Brief
Kurwa v. Kislinger – (2013) __ Cal.4th __ (California Supreme Court)
Article used: “Appellate Reports and cases in brief” by Jeffrey Isaac Ehrlich

What is the case about – “One final judgment rule” – California Code of Civil Procedure §904.1

Holding of the Court:
Under the “one final judgment” rule, one cannot file an appeal from a judgment that disposes of some of the causes of action by a dismissal with prejudice, while other causes of action have been dismissed without prejudice by the parties who waive operation of the statute of limitations as to those causes of action.

Summary of the Case:
Kurwa and Kislinger, both ophthalmologists, formed a corporation to provide medical services to HMO patients. Thereafter, Kurwa’s medical license was suspended. Kislinger informed the HMO of Kurwa’s suspended license, and after forming his own corporation, the HMO entered into a new agreement with Kislinger only.

Thereafter, Kurwa sued Kislinger for breach of fiduciary duty and defamation. Kislinger cross-complained.

During pre-trial motions, the court determined that once a new corporation was formed, neither party owed the other a fiduciary duty. In light of this, Kislinger agreed to dismiss his breach of fiduciary duty claim with prejudice. Moreover, both parties agreed to dismiss their respective defamation claims, without prejudice, and waive any statute of limitation issues, until the Court of Appeal heard and decided Kurwa’s appeal as to the Superior Court’s decision on his breach of fiduciary claim.

The Court of Appeal determined that the Superior Court’s judgment was final and appealable because the other causes of action (the defamation cause of action) had been dismissed and were no longer pending in the State court. The Court of Appeal declined to follow Don Jose’s Restaurant, Inc, v. Truck Ins. Exchange (1997) 53 Cal.App.4th 115, which held that the parties’ agreement holding some causes of action in abeyance for possible future litigation after an appeal from a trial court’s judgment on other causes of action renders the judgment interlocutory and precludes an appeal under the “one final judgment rule.”

The Supreme Court reversed this Court of Appeal’s decision finding that the Don Jose rule was valid.

California Code of Civil Procedure §904.1(a)(1) states: “An appeal, other than in a limited civil case, is to the court of appeal. An appeal, other than in a limited civil case, may be taken from any of the following:(1) From a judgment, except (A) an interlocutory judgment, other than as provided in paragraphs (8), (9), and (11), or (B) a judgment of contempt that is made final and conclusive by Section 1222.”

An interlocutory judgment is one that is temporary and not intended to be final. The Supreme Court held that allowing parties and trial courts to designate a substantively interlocutory judgment as final and appealable would be inconsistent with the “one final judgment rule.” The Court held that “When, as here, the trial court has resolved some causes of action and the others are voluntarily dismissed, but the parties have agreed to preserve the voluntarily dismissed counts for potential litigation upon conclusion of the appeal from the judgment rendered, the judgment is one that ‘fails to complete the disposition of all the causes of action between the parties and is therefore not appealable.”