Federal National Mortgage Association v. Marjorie Johnston and Kamberleigh Johnston
189 A.3d 567
Vt.2018Background
- Fed. Nat’l Mortg. Ass’n (bank) sued Marjorie Johnston in June 2016 for eviction; that action ended in November 2016 when the court vacated a default judgment and dismissed the case without prejudice for defective service and expired time for service.
- In March 2017 bank filed a new eviction action against Marjorie and Kamberleigh Johnston for the same property (49 Pine St., Unit 2).
- Bank filed a notice of voluntary dismissal in June 2017 before defendants had answered; the dismissal was entered without prejudice.
- Marjorie Johnston then appeared and moved to reconsider, arguing the two‑dismissal rule (V.R.C.P. 41(a)(1)) required dismissal with prejudice because of the prior 2016 dismissal; she also argued the case was moot (bank had sold the property).
- The trial court denied reconsideration without a hearing, explaining the voluntary dismissal was effective as of right and the earlier dismissal was a court‑ordered dismissal.
- Defendants appealed; the Supreme Court affirmed, holding the two‑dismissal issue is not ripe until a third action is filed and declining to reach the mootness question.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a plaintiff’s voluntary dismissal under V.R.C.P. 41(a)(1) can be converted to a dismissal with prejudice based on prior dismissals | Bank: voluntary dismissal is effective upon filing without court order when no answer has been served | Defs: this voluntary dismissal should operate as an adjudication on the merits (with prejudice) under the two‑dismissal rule because of the November 2016 dismissal | Court: not ripe — whether the two‑dismissal rule applies can be determined only if a third action is filed; voluntary dismissal is effective on filing |
| Whether the trial court erred by denying reconsideration without a hearing | Bank: court properly disposed of the motion; no hearing required | Defs: denial without hearing prejudiced their rights | Court: no abuse of discretion; no prejudice shown because the two‑dismissal issue was not within the court’s authority at that time |
| Whether the case should have been dismissed as moot because bank sold the property before dismissal | Bank: voluntary dismissal was effective and court lacked authority to act after dismissal | Defs: sale rendered the eviction claim moot and required dismissal with prejudice | Court: declined to reach merits of mootness claim because voluntary dismissal was already effective; upheld that court could not reconsider after voluntary dismissal was filed |
| Whether the earlier (Nov. 2016) court‑ordered dismissal counts as a plaintiff dismissal for Rule 41(a)(1) purposes | Bank: implied that prior dismissal was by court order and thus distinct | Defs: prior dismissal should count toward the two‑dismissal rule | Court: left this question open and did not decide; it becomes relevant only if a third action is filed |
Key Cases Cited
- State v. Amidon, 185 Vt. 1, 967 A.2d 1126 (Vt. 2008) (procedural‑rule interpretation reviewed de novo)
- Commercial Space Mgmt. Co. v. Boeing Co., 193 F.3d 1074 (9th Cir.) (whether two‑dismissal rule applies to a voluntary dismissal is ripe only in a third action)
- Cenlar FSB v. Malenfant, 203 Vt. 23, 151 A.3d 778 (Vt. 2016) (a court should not dictate preclusion consequences at time of first action)
- Am. Soccer Co. v. Score First Enters., 187 F.3d 1108 (9th Cir.) (plaintiff’s right to voluntary dismissal before answer bars trial court from interfering)