Lack of a “Final Judgment” Avoids Decision on the Merits

The appellate process is typically defined by rigid rules. These rules can pertain to the timing of when a Notice of Appeal can be filed, how post-judgment motions change the timing for a Notice of Appeal, and the scheduling for briefing at the appellate court.

Before considering any of the more procedural rules for an appeal, a litigator must be aware of the “final judgment” rule. A critical threshold issue for any appeal is whether the appeal arises from a “final judgment.”

With a single variation, an appeal must arise from a “final judgment.” That is, the judgment being appealed must resolve all issues in a case, leaving nothing for future determination. This means that any judgment that does not dispose of all claims or parties is generally not considered appealable because it is not a “final judgment.”

The single variation of the “final judgment” rule is that a trial court may enter a judgment as to one or more but fewer than all claims or parties and make an express determination that there is no just reason for delay for the purposes of appeal. Rule 74.01. In order to pursue an appeal of a judgment that disposes of less than all claims or parties, there must be an “express” finding or determination by the trial court pursuant to Rule 74.01.

At face value, it would seem easy to comply with the “final judgment” rule. Yet litigators frequently run afoul the basic principle and initiate appeals that are ultimately dismissed for lack of jurisdiction without any discussion of the actual legal issues from the underlying case.

The recent decision in Syorka v. Farmers Ins. Co. illustrates the problem of pursuing an appeal from a judgment that did not actually dispose of the entire case. More to the point, the decision in Syorka shows that litigators continue to struggle with the “final judgment” rule and incur substantial costs in pursuing an appeal that was not ripe for adjudication in the first place.

In Sykora, Joseph Surratt operated his vehicle while intoxicated and struck the vehicle of George Sykora, ultimately causing George’s death. 642 S.W.3d 3811, 382 (Mo. App. W.D. 2022). Following the accident, George’s wife, Tracy Sykora, and their two children sued Joseph Surratt for wrongful death and obtained a judgment awarding $22,500,000. Id. The wrongful death suit also named the parents of Joseph Surratt—Chad and Kristy Surratt under a theory of negligent entrustment with respect to Joseph. Id.

At the time of the accident, Chad and Kristy Surratt had an automobile policy with Farmers Insurance Company, Inc. Id. The Farmers Policy did not identify Joseph as a “household driver” or a “named insured,” but did provide coverage for an insured person, defined as “you or any family member.” Id. The term family member was defined as “a person related to you by blood, marriage or adoption who is a resident of your household.” Id.

In conjunction with the suit, Tracy Sykora issued a demand letter to Farmers to pay out the limits of the Farms Policy—$500,000. Id. Farmers rejected the demand on the basis that Joseph Surratt was not covered under the Farmers Policy because he was not a resident of Chad and Kristy Surratt’s household. Id.

After obtaining the $22,500,000 judgment against the Surratts, Tracy Sykora filed an equitable garnishment action against Farmers, arguing that Farmers had a duty to defend and indemnify Joseph Surratt. Id. Tracy argued that because the underlying wrongful death judgment included a finding of fact that Joseph Surratt was a resident of Chad and Kristy’s household, Farmers was estopped from contesting or otherwise challenging the underlying judgment. Id.

The trial court granted summary judgment to Tracy Syorka, denied summary judgment to Farmers, and specifically determined that Farmers had a duty to defend Joseph Surratt and could not challenge the residency determination made in the wrongful death judgment. Id. “The court below did not, however, make any determination as to the damages necessitated by its finding of Farmer’s liability.” Id.

In its review of the summary judgment, the Court of Appeals first considered whether it had jurisdiction to address the merits. Id. at 384. The Court noted that a party only had a right to appeal a “final judgment in the case.” Id. “A final judgment is defined as one that resolves ‘all issues in a case, leaving nothing for future determination.’” Id. (quoting First Nat’l Bank of Dieterich v. Pointe Royale Prop. Owners’ Ass’n, Inc., 515 S.W.3d 219, 221 (Mo. banc 2017)(quoting Transit Cas. Co. ex el. Pulitzer Publ’g Co. v. Transit Cas. Co. ex rel. Intervening Emps., 43 S.W.3d 293, 298 (Mo. banc 2001)).

In any case, the existence of a final judgment is a “prerequisite to appellate review” and “if the circuit court’s judgment was not a final judgment, the appeal must be dismissed.” Id. (citing Loerch v. City of Union, 601 S.W.3d 549, 552 (Mo. App. E.D. 2020)). A judgment that only resolves part of a claim or resolves some of the claims pending in a lawsuit but leaves other unresolved, generally is not a “final judgment” for the purposes of Mo. Rev. Stat. § 512.020(5). Id.

The Court observed that the appeal came from the grant of summary judgment to Tracy Sykora and the simultaneous denial of Farmer’s motion for summary judgment. Id. The Court noted that while a grant of summary judgment typically constitutes a “final judgment on the merits of a cause of action,” partial summary judgment for the plaintiff on the issue of liability alone “is interlocutory in character . . . and is not a final judgment subject to appellate review.” Id. (citing Wooldrige v. Greene Cnty., 198 S.W.3d 676, 678 n.2 (Mo. App. S.D. 2006) and Stotts v. Progressive Classic Ins. Co., 118 S.W.3d 655, 660 (Mo. App. W.D. 2003)).

The Court held that the judgment in the underlying case, granting summary judgment to Tracy Syorka, found that Farmers had a duty to defend Joseph Surratt in the wrongful death lawsuit and therefore had a duty to indemnify in the underlying equitable garnishment lawsuit. Id. “Thus, it determined liability; it did not, however, indicate the monetary amount for which Farmers was liable.” Id. (emphasis added).

In the equitable garnishment, Tracy Syorka pled damages in the amount of $22,500,000 and sought post-judgment interest, court costs, and all other relief the court deemed reasonable. Id. The limit of the Farmers Policy was $500,000. Id. “Though the court below granted a motion by Farmers to dismiss the petition’s request for damages in an amount that exceeded the policy limit, it has yet to order Farmers to pay any money as a result of its liability determination.” Id. (emphasis in original).

The Court compared the facts to that of Stotts where the trial court entered partial summary judgment in favor of the plaintiffs on liability but attempted to make the judgment final for purposes of appeal, but if the plaintiffs prevailed on appeal then the defendants would be also liable for damages in the amount of its policy limit plus post-judgment interest. Id. In Stotts, the court held that the purported judgment was not final for purposes of appeal because it only determined liability and failed to identify the amount of damages. Id. (citing 118 S.W.3d at 660–61). The Court analogized to Stotts and determined the underlying judgment granting summary judgment to Tracy Syorka only found liability on the part of Farmers but had no determination as to the amount of damages. Id. “Therefore, the judgment is not final for purposes of appeal, and we must dismiss.” Id. at 384–85.