Russ Stockton and Stephanie Stockton v. Sentry Insurance, a Mutual Company, and Curt L. McDuff, Jr.

Annotate this Case
Russ STOCKTON and Stephanie Stockton v.
SENTRY INSURANCE, a Mutual Company, and Curt
L. McDuff, Jr.

97-720                                             ___ S.W.2d ___

                    Supreme Court of Arkansas
                Opinion delivered March 26, 1998


1.   Appeal & error -- appealable order -- what constitutes --
     finality of order governed by Ark. R. App. P.--Civ. 2. -- To
     be appealable an order must be final pursuant to Ark. R. App.
     P.--Civ. 2, and the finality of a trial court's order is
     governed by Ark. R. Civ. P. 54(b), which provides that a trial
     court may direct entry of a final order or judgment as to
     fewer than all the parties to a multiparty suit, as long as
     the court expressly determines, with factual findings, that
     there is no just reason to delay the appeal; in the absence of
     this determination and findings, an order is not final when it
     adjudicates fewer than all the claims or the rights and
     liabilities of fewer than all the parties. 

2.   Appeal & error -- nonsuit -- court order necessary to grant --
     must be entered to be effective. -- A court order is necessary
     to grant a nonsuit and that the order, judgment, or decree
     must be entered to be effective.

3.   Appeal & error -- two claims still pending -- appeal dismissed
     without prejudice on jurisdictional grounds. -- Where
     appellant's wage-loss claim remained pending below, as did the
     appellee's counterclaim, appellants failed to comply with the
     directives of Rule 54(b) before filing their notice of appeal;
     the supreme court dismissed the case without prejudice on
     jurisdictional grounds. 


     Appeal from Pulaski Circuit Court; Morris W. Thompson, Judge;
appeal dismissed.
     Matthew Horan, for appellants.
     Cross, Gunter, Witherspoon & Galchus, P.C., by:  M. Stephen
Bingham, for appellees.

     Tom Glaze, Justice.
     Appellants Russ and Stephanie Stockton filed suit against
appellee Sentry Insurance and its agent, Curt L. McDuff, Jr.  The
Stocktons alleged that Sentry had recruited Russ to be a franchisee
to sell and distribute Sentry's insurance services in Benton
County, and in return, he was to receive an income of $50,000.00,
an office, a company car, a sales coordinator, and a telephone
service.  The Stocktons further charged that McDuff had intimidated
and harassed them during a three-year period and had reneged on
Sentry's promise of an office, forcing Stephanie Stockton to serve
as Russ's unpaid secretary.  Russ Stockton also asserted that
Sentry's and McDuff's actions forced him to resign, and although he
had prearranged with Sentry to have his dental work done, Sentry
called the dentist's office and improperly withheld its approval
when Russ was actually in the dental chair having his teeth
drilled.  In their complaint, the Stocktons alleged the following
seven separate causes of action against Sentry and McDuff:
     (1)  fraud in the offer of a franchise to Russ Stockton;
     (2)  tort of outrage towards both Russ and Stephanie Stockton;
     (3)  violation of the wage and hour laws as related to
Stephanie;
     (4)  negligence against Russ Stockton;
     (5)  breach of Russ Stockton's contract;
     (6)  tortious interference with Russ Stockton's contract;
     (7)  battery in Russ Stockton's favor as a result of Sentry's
acts in cancelling his dental insurance in "mid-procedure." 
     Sentry and McDuff moved to dismiss the Stocktons' complaint
under Ark. R. Civ. P. 12(b)(6), stating the complaint failed to
state facts upon which relief could be granted.  The Stocktons
responded, stating their complaint was sufficient, and the motion
to dismiss should be denied.  After the respective parties
submitted briefs, the trial court entered its order dismissing all
of the Stocktons' complaint, except Stephanie Stockton's claim for
unpaid wages.  
     After the trial court's order, dismissing most of the
Stocktons' claims, was entered on January 30, 1997, Sentry and
McDuff, a week later, filed an answer and counterclaim.  In their
answer, Sentry and McDuff primarily denied Stephanie's remaining
claim, but their counterclaim asserted entitlement to contribution
and indemnity against Russ Stockton, if they were adjudged liable
to Stephanie.  The Stocktons then moved for the trial court to
reconsider its granting of Sentry's and McDuff's summary-judgment
motion.  When the trial court failed to rule on their motion, the
Stocktons filed their reply to Sentry's and McDuff's counterclaim,
and then filed what they captioned as a "Notice of Dismissal."  No
further action was taken by the trial court, Sentry or McDuff, and
the Stocktons filed their notice of appeal from the trial court's
January 30, 1997 order.  Sentry and McDuff countered, arguing that,
because the Stocktons had not complied with Ark. R. Civ. P. 54(b),
no final order had been entered from which the Stocktons can
appeal.  In addition, they submit that, even if there was a final
order, the Stocktons' appeal was filed untimely.
     The Stocktons' appeal is obviously premature, and must be
dismissed, since they failed to comply with Rule 54(b).  We have
repeatedly held that, to be appealable, an order must be final,
Ark. R. App. P.--Civil 2, and the finality of a trial court's order
is governed by Rule 54(b), which provides that a trial court may
direct entry of a final order or judgment as to fewer than all the
parties to a multiparty suit, as long as the court expressly
determines, with factual findings, that there is no just reason to
delay the appeal.  See Dean v. Tallman, 331 Ark. 127, 959 S.W.2d 41
(1998).  In the absence of this determination and findings, an
order is not final when it adjudicates fewer than all the claims or
the rights and liabilities of fewer than all the parties.  Id.  The
underlying policy of this rule is to avoid piecemeal appeals.  Id.
     In this case, the trial court's order never mentioned Sentry's
and McDuff's counterclaim, see Williamson v. Misemer, 316 Ark. 192,
871 S.W.2d 396 (1994), but most significant, the Stocktons never
properly dismissed Stephanie Stockton's remaining wage-loss claim,
which is still pending.  As we previously mentioned, Stephanie
Stockton filed a "notice of dismissal," which she now argues
dismissed her remaining claim.  However, we have held that a court
order is necessary to grant a nonsuit and that the order (judgment
or decree) must be entered to be effective.  Blaylock v. Shearson
Lehman Bros., Inc., 330 Ark. 620, 954 S.W.2d 939 (1997).  Here, the
record reflects the Stocktons never filed an actual motion to
dismiss Stephanie's claim, nor did they request the trial court to
rule on their dismissal request.  
     In sum, Stephanie Stockton's wage-loss claim remains pending
below, as does the counterclaim of Sentry and McDuff.  Because the
Stocktons failed to comply with the directives of Rule 54(b) before
filing their notice of appeal, we must dismiss without prejudice on
jurisdictional grounds.