ABB, Inc. v. Securitas Security Services USA, Inc.ABB, Inc. v. Securitas Security Services USA, Inc.
ABB, Inс. (“ABB”) appeals from the trial court’s entry of partial summary judgment in favor of Securitas Security Services USA, Inc. (“Securitas”). In its judgment, the trial court interpreted a security services agreement between ABB and Securitas and concluded that the agreement required ABB to indemnify Securitas for claims asserted by injured employees and relatives of deceased employees following a workplace shooting. The trial court certified its judgment as final for purposes of appeal pursuant to Rule 74.01(b). We conclude that the judgment did not dispose of a distinct judicial unit and that we thus do not have jurisdiction to entertain this appeal, requiring its dismissal.
Factual and Procedural Background
ABB Power T & D Company, Inc. (a predecessor in interest to ABB) entered into a security services agreement (“Agreement”) with Burns International Seсurity Services (a predecessor in interest to Securitas) in 1998. The Agreement provided that Securitas would provide ABB with security services. The Agreement set limits on the liability Securitas would face as a result of the provision of its services and required indemnification from ABB in certain instances. The Agreement outlined Securitas’s potential liability as follows:
In no event shall [Securitas] be liable to [ABB] for any Claim other than one which arises during the performance of services under this Agreement and is caused by the negligence of [Securitas], its employees or agents while acting within the scope of their duties and authority. In no event shall [Securitas] be liable for any Claim caused in whole or in part by acts or omissions of [ABB] or third parties or their respective employees or agents, or for consequential or incidental damages or loss of profits.
With respect to indemnification, the Agreement provided:
[ABB] agrees to indemnify and hold [Securitas] harmless from and against any Claims made by a third party(s), including, but not limited to, injury, death or damage or loss of property, arising from [Securitas] negligent acts or omissions, including those relating to the hiring, training, supervision or retention of Personnel by [Securitas], its agents or employees.
The Agreement did not define “third party.”
In April 2010, relatives of the deceased employees filed wrongful death lawsuits and several injured employees filed personal injury lawsuits against Securitas (“Employee Lawsuits”).
ABB filed a declaratory judgment action against Securitas. In its petition, ABB asked the trial court for “[a] declaration that the [Agreement] does not require ABB to defend or indemnify Securitas against or from the claims in the [Employee Lawsuits].” Securitas answered the petition, denying ABB’s argued construction of the Agreement.
ABB and Securitas filed cross motions for summary judgment addressing ABB’s declaratory judgment action. Each agreed the issue before the court was whether the Agreement required ABB to indemnify Securitas for claims asserted by ABB employees or their families. Each agreed that the construction of the Agreement presented a question of law and that there were no material facts in dispute preventing the entry of summary judgment on that issue. Each asked the trial court to determine whether the Agreement obligated ABB to “defend and indemnify” Securitas against the claims in the Employee Lawsuits.
Before the cross-motions for summary judgment were argued and taken under submission, Securitas sought and was granted leave to file a counterclaim against ABB for breach of contrаct. Securitas’s counterclaim alleged that ABB’s refusal to defend and indemnify Securitas in the Employee Lawsuits was a breach of the Agreement and that Securitas had been damaged as it was incurring the cost to defend, and was exposed to pay judgments or settlements of, the Employee Lawsuits.
On February 10, 2012, the trial court granted Securitas’s motion for summary judgment and denied ABB’s motion for summary judgment (“Judgment”). The trial court entered judgment in favor of Securitas and against ABB on ABB’s de
ABB then filed this appeal.
Jurisdiction
Securitas argues that we do not have jurisdiction to hear this appeal because the trial court’s Judgment was not eligible for certification as a final appeal pursuant to Rule 74.01(b) as the unresolved counterclaim involves issues that are “inextricably intertwined” with ABB’s declaratory judgment action. ABB argues that we have jurisdiction to entertain this appeal because the Judgment disposed of the sole claim raised by ABB.
The right to appeal is established by statute. See MO. CONST, art. Y, section 5. We acquire jurisdiction to entertain an appeal upon the trial court’s issuance of a “final judgment.” Sеction 512.020(5);
Rule 74.01(b) provides an exception to the general finality rule, however. It permits a trial court to characterize a judgment as “final” even though it disposes of fewer than all the claims or parties but “only upon an express determination that there is no just reason for delay.” Though written to suggest unfettered discretion in the trial court, in fact a trial court’s certification “that there is no just reason for delay” is not conclusive. Lunceford v. Houghtlin,
A trial court’s designation of a judgment as final under Rule 74.01(b) “is effective only when the order disposes of a distinct ‘judicial unit.’ ” Id. Stated differently, even if the circumstances suggest that judicial economy could be promoted by certification of an interlocutory order as final, unless the interlocutory order disposes of a distinct “judicial unit,” the order cannot be properly certified as final pursuant to Rule 74.01(b), rendering this court without jurisdiction to entertain an appeal from the order.
The meaning of the phrase “judicial unit” was well articulated by our Supreme Court in Gibson:
The required “judicial unit for an аppeal” has a settled meaning: “the final judgment on a claim, and not a ruling on some of several issues arising out of the same transaction or occurrence which does not dispose of the claim.” State ex rel. State Hwy. Comm’n v. Smith,303 S.W.2d 120 , 123 (Mo.1957). “An orderdismissing some of several alternative counts, each stating only one legal theory to recover damages for the same wrong, is not considered an appealable judgment while the other counts remain pending because the counts are concerned with a single fact situation.” Weir v. Brune [ 364 Mo. 415 ],262 S.W.2d 597 , 600 (Mo.l95S). It is “differing,” “separate,” “distinct” transactions or occurrences that permit a separately appealable judgment, not differing legal theories or issues presented for recovery on the same claim. Id.
This definition of “judicial unit” requires that a “trial court’s decision ... dispose of a minimum of one claim.” Bannister v. Pulaski Fin. Corp.,
This accepted view of a distinct “judicial unit” has been similarly applied when the claims or counts remaining in a case are cross-claims or countеrclaims arising out of the same set of facts, and the same transactions and occurrences, as the dismissed claims or counts appealed. In fact, Rule 74.01(b) expressly anticipates such an outcome, as it provides:
When more than one claim for relief is presented in an action, whether as a claim, counterclaim, cross-claim, or third-party claim ... the court may enter a judgment as to one or more but fewer than all of the claims ... оnly upon an express determination that there is no just reason for delay.
(Emphasis added.) Thus, in Columbia Mutual Insurance Co. v. Epstein,
Both actions require proof of facts as to the nature of the coverage afforded by the insurance policy to [the insured], and both actions rely оn interpretation of the policy language as to such coverage. Thus, [the insurance company’s] request for declaratory judgment as to its duty to defend and indemnify is inextricably intertwined with [the insured’s] still-pending counterclaim for vexatious refusal to pay and bad faith.
Id. The Eastern District observed that both the declaratory judgment action and the counterclaim sought a remedy for the same аlleged legal right. Id. at 551-52. “[A] judgment that fails to dispose of all remedies asserted as to the same legal rights, leaving some legal rights open for future adjudication, is not a final judgment under Rule 74.01(b).” Id. at 550.
Similarly, in Bannister v. Pulaski Financial Corp.
In yet another example, the Southern District concluded in Boomerang Transportation, Inc. v. Miracle Recreation Equipment Co.,
The circumstances presented by the instant case cannot be distinguished from Epstein, Bannister, or Boomerang Trans
Thus, the sole judicial unit at issue in this case has not been fully disposed as Securitas’s counterclaim has not been determined. Even if the Judgment effectively determines the issue of liability on Securitas’s counterclaim, the essential element of Securitas’s damages has not been determined. See Clay County ex rel. County Comm’n of Clay v. Harley & Susie Bogue, Inc.,
It is noteworthy that had Securitas, nоt ABB, initiated the declaratory judgment action, Securitas would have been required to assert its breach of contract claim as a separate additional count or risk running afoul of the doctrine forbidding splitting causes of action. See Comm, for Educ. Equal.,
We thus reject ABB’s argument that a “judicial unit” was determined by the trial court’s Judgment because ABB’s sole and only claim has been disposed. ABB’s argument:
Misapprehends the nature of the declaratory judgment act. The declaratory judgment act was designed to provide a preventative remedy. It supplements but does not supplant other remedies. “[I]t affects exclusively matters of practice, pleadings, and forms and modes of proceedings; it does not create any new or substantive rights, but is procedural in nature.” While the declaratory judgment act is liberally construed to aсcomplish its preventive purpose, it is but one of several remedies, not a substantive claim.Comm, for Educ. Equal, 878 S.W.2d at 452 (internal citation omitted). ABB’s argument also improvidently conflates the disposition of a “count” or cause of action with the disposition of a distinct legal theory or judicial unit.
We necessarily conclude that we do not have jurisdiction over this appeal. “The purpose and policy behind [Rule 74.01(b) ] is to avoid redundant review of multiple appeals based on the same underlying facts and similar legal issues.” Id. at 451. A later appeal from the disposition of Sec-uritas’s pending counterclaim would require us to review the same underlying facts and similar legal issues. Though we are mindful of ABB’s argument that “judicial economy” would be furthered by immediate resolution of the parties’ dispute abоut the scope of the indemnity provision, we are not at liberty to ignore our jurisdictional constraints on this basis. Moreover, ABB’s argument ignores that if the trial court’s construction of the indemnity provision is correct, then conducting two separate appeals to review the meaning of the Agreement separately from the damages awarded will not have fostered judicial economy.
Conclusion
ABB’s appeal is dismissed. This matter is remanded for further proceedings consistent with this opinion.
All concur.
Notes
. Two Securitas employees, Janisha Johnson and Cordin Hudson, were also named defendants in the Employee Lawsuits. Securitas’s demand on ABB to defend and indemnify the claims asserted in the Employee Lawsuits included a demand to defend and indemnify the individual employees. However, the individual employeеs are not named as parties in the instant case.
. At oral argument, counsel for ABB correctly characterized the counterclaim as compulsory in nature, a principle equated with claim preclusion. “The compulsory counterclaim is a means of bringing together all logically related claims into a single litigation, through the penalty of precluding the later assertion оf omitted claims.” Harmon v. Headley,
. All statutory references are to RSMo 2000 as supplemented unless otherwise indicated.
. The Southern District characterized the trial court’s decision to certify its judgment under Rule 74.01(b) as legally erroneous because the judgment did not dispose of a judicial unit and also as an abuse of discretion. Boomerang Transp., Inc.,