587 S.W.3d 1
Tenn. Ct. App.2019Background
- In 2012 Awash sued Asfour in Davidson County Chancery Court for breach of a business property sales contract and sought a TRO; service and notice facts were disputed and Asfour was absent from hearings.
- A default judgment was entered against Asfour in February 2013 and $130,000 in damages was awarded; the judgment was later assigned to Levitt, Hamilton, and Rothstein, LLC (Appellant).
- Appellee Asfour moved in 2018 under Tenn. R. Civ. P. 55.02 and 60.02 to set aside the default judgment, alleging lack of notice and other grounds; the trial court set aside the judgment under Rule 60.02(5) and denied dismissal of the underlying claim.
- The trial court’s post-judgment order was expressly non-final and left the underlying claim alive; the court also denied competing motions to alter or amend.
- Appellant filed a Rule 3 appeal as of right and sought a Rule 9 interlocutory appeal (denied); this Court was asked to adopt a federal-style “jurisdictional exception” allowing immediate appeal of orders granting Rule 60.02 relief when the trial court allegedly lacked jurisdiction.
- The Court of Appeals dismissed the appeal for lack of subject-matter jurisdiction, declined to adopt the federal jurisdictional exception, and declined to suspend finality under Tenn. R. App. P. 2.
Issues
| Issue | Plaintiff's Argument (Appellant) | Defendant's Argument (Appellee) | Held |
|---|---|---|---|
| Whether an interlocutory order setting aside a final judgment under Tenn. R. Civ. P. 60.02 is immediately appealable as of right when the trial court allegedly lacked jurisdiction (the federal "jurisdictional exception"). | Tennessee should adopt the federal Phillips-origin exception permitting immediate appeal of non-final orders that were entered without jurisdiction. | Tennessee should reject the exception and require final judgment or discretionary interlocutory/extraordinary review. | Court declined to adopt the jurisdictional exception; appeal dismissed for lack of jurisdiction. |
| Whether untimeliness of a Rule 60.02 motion deprives the trial court of subject-matter jurisdiction to decide it. | Untimely Rule 60.02 motions here meant the trial court lacked jurisdiction, so the grant should be immediately reviewable. | Timeliness is a merits/discretionary issue and does not divest subject-matter jurisdiction under Tennessee law. | Timeliness does not deprive the trial court of subject-matter jurisdiction; Court rejected jurisdictional characterization. |
| Whether this Court should exercise discretion under Tenn. R. App. P. 2 to suspend Rule 3(a) finality requirement for good cause (judicial economy/avoid duplication). | Judicial economy and avoidance of pointless duplication justify suspending finality and hearing the appeal now. | No extraordinary circumstances shown; Rule 3(a) should not be suspended. | Court declined to suspend finality under Rule 2; Rule 3(a) finality requirement enforced. |
| Whether other Tennessee procedures (Rule 9 interlocutory or Rule 10 extraordinary appeals) suffice to review an alleged jurisdictional error in granting Rule 60.02 relief. | The federal exception is needed because Rule 9/10 are inadequate to prevent needless litigation. | Rule 9 and Rule 10 (and Rule 54.02) provide discretionary paths; appellant had opportunity but failed to justify immediate review. | Court held Tennessee’s interlocutory/extraordinary procedures are the appropriate routes; appellant had sought Rule 9 and was denied. |
Key Cases Cited
- Phillips v. Negley, 117 U.S. 665 (U.S. 1886) (origin of the federal rule allowing immediate review where a court purportedly lacked jurisdiction to vacate a judgment)
- Bayberry Associates v. Jones, 783 S.W.2d 553 (Tenn. 1990) (recognizes appellate power to suspend Rule 3(a) but requires good cause and record justification)
- Asset Acceptance, LLC v. Moberly, 241 S.W.3d 329 (Ky. 2007) (adopts the jurisdictional exception permitting immediate appeal of orders setting aside judgments when trial court lacked jurisdiction)
- Baca v. Atchison, Topeka & Santa Fe Ry. Co., 918 P.2d 13 (N.M. Ct. App. 1996) (declines to adopt the jurisdictional exception; favors existing interlocutory/extraordinary review)
- Hussey v. Woods, 538 S.W.3d 476 (Tenn. 2017) (timeliness of Rule 60 motions reviewed under abuse-of-discretion standard)
- Estate of Brown, 402 S.W.3d 193 (Tenn. 2013) (statutes of limitations do not deprive courts of subject-matter jurisdiction)