Audi Vision Inc. v. RCA Mfg. Co.

INC., RCA MFG. al. v. et VISION AUDI CO., Inc.

No. Appeals, Circuit. Second Court of

Circuit 10, 1943.

June Singеr general manager, who as its preparation plans worked out the for agreed program, educational and was familiar with all pected ex- details and its completion; manner of de- fendant and Singer agree- entered into deprive ment to Audi Vision of bene- pursuant fits of this contract to which Singer resigned plaintiff’s employ and entered that of defendant make in order to plans use of all the and benefits of the contract; consequence and that in defend- ant had received all the benefits of the cоntract, notwithstanding its claimed can- plaintiffs cellation. The other than Audi City Gordon, of New York Harry A. Vision were copartnership to whom the and Abraham & C. Gordon (Harry A. Eric installment, second payable January 2, Lillienthal, City, York on tha of New all 1942, had assigned. Plaintiffs asked brief), plaintiffs-appellants. for judgment for price remaining contract unpaid, less the reasonable value cost and City Knauer, of York New Fred J. completion work, of the estimated to Zachry, & Cahill Gordon, Parlin (Wright, $4,700. about McKay, New York all of Lawrence and J. defendant-аppellee. brief), for City, on the In its answer defendant stressed its re- contract, upon liance its cancellation of the FRANK, SWAN, CLARK, and Before above, quoted clause under the Judges. Circuit given it claims first Audi Vision or notice on about December with CLARK, Judge. Circuit 2, 1942, February on written notice Incorporated and Vision Audi Plaintiff preparation presentation both before or contract a written into entered defendant frame-by-frame script. pleaded It also whereby plaintiff November counterclaim, first in which it relied on films, re- certain slide produce agreed to cordings, and constituting a say expenses this same clause to incurred that the material—all supplementary Audi Vision before cancella- pro- proposed educational $1,500 tion did not exceed there- deal- distributors and defendant’s gram for fore, entitled it was to a refund out of the sale of defendant’s promoting ers $1,740 paid by initially in- sum which defendant records—for phonograph terest; and for a second counterclaim it $16,200 installments. pay in three agreed to up goods an account of and merchan- set $3,240 paid up- was installment first delivered, $1,454.61 showing still due. dise A clause of making of contract. on the reply, reiterating Plaintiffs’ addition “Cancellations,” in entitled contract the addition contract, challenged their claims only cancellation, by provision for ato Depositions counterclaim. the first material, stipulated Vision, here not Audi sides, by both and thereafter were taken defendant, called “the as to as follows summary judgment moved for defendant productions for “Orders Sponsor”: dismissing complaint judgment for Sponsor by the on written no- be cancelled pleadings as to the second counter- prior approval any time tice at granted The court claim. motion thereafter; script but not frame-by-frame appeal followed. however, Sponsor that at fair and provided, appeal plaintiffs do attack not On this pay customary shall such event on the sec- judgment given defendant already expense devoted time rates to the counterclaim, dis- but do contest the of ond not to exceed productiоn, 25% conclusions that defendant’s trict court’s price.” In this action for minimum was unrestricted of cancellation privilege alleged that de- contract it breach allegations of defendant’s February and that no- or about fendant general manager into taking Audi Vision’s Audi Vision that would tified get the employ, in order to benefits of then, contract, and its to meet perform the notwithstanding the cancella- cancellation, the contract tion, it is expected defense issue present of fact. February did plain- until set forth tiff Audi object to the failure to allow They also employ had in its Vision case second, Notably as- court. in their third or judgment at least point, counterclaim, dealing they January 2, with the signed, due installment argue or, alternative, possible that determination is not balance of $810 for a way, stressing already are entitled devoted due for under allegations performance, of production. to the valid, if attempted even the cancellation is presented the we are with At the outset up to a per refund 25 of cent the total question finality judgmеnt en- purchase price they or more $810 than have appear- judgment tered below. Since the paid, for the Audi value of Vision’s ing record not mention the first of does expenses. time and counterclaim, portion that of the action re- quite standing. mains This is made clear seem, therefore, to be Plaintiffs by opinion the statement in that the court’s yet ground on the trial unassailable that liability pay for defendant’s time and they be had herein are entitled to show expense incurred before cancellation “is recovery in a basis of for at event put by first issue the counterclaim and they originally least That had $810. reply by the and will be determined a trial substantially greater a claimed amount has Indeed, original of that issue.” mo- the bearing recovery no to be actual papers tion stated that the action was on after answer filed and Rule at trial. See trial, jury the calendar immediate 54(c). essentially Defendant concedes simpli- would be much and that the issues by justice saying contention of this in the only the claim involved fied restricted brief defendant’s first сounterclaim its is now on counterclaim. And de- in defendant’s first awaiting trial, trial calendar the brief never fendant’s here shows perfectly willing and that “defendant is stipulate ‍‌‌‌​​​‌​‌​‌​‌‌‌‌​​​‌‌‌​​​‌​​‌​​‌‌​‌‌​‌​​‌‌​​​‌‌‌‍sought summary disposition of coun- plaintiff’s claim to the $810 question, therefore, terclaim. The arises together with the counter shall be tried judgment, which whether the leaves this claim, jury so the whether de decide undetermined, issue is final as to the mat- overpaid underpaid.” fendant has or That adjudicate. purports only ters it Our significant light in a concession most the course, concern, of as to the dismissal principle, governing of Rule forth the set contract; original of claim on the the the 54(b), separate judg a final judgment on the uncontested second coun- ment there must be “a determination of principles final terclaim is under the here- particular the issues material ato claim discussed, although after the district court arising and all counterclaims of out the stay it, may upon still wish to execution transaction or occurrence is the sub matters, disposition of other pending provided as ject mattеr of the claim.” 54(b), last sentence Rule adoption of the Before the federal Procedure, 28 Civil Federal Rules of C.A. U.S. dismissal rules it was clear that the of a following 723c. section action was where the left counterclaim pending judgment. final Even when the would not a issue, duty Electric Co. v. Marvel Rare is the court General Metals raised the 430, 202, 432, Co., 53 77 whether “decision” is S.Ct. L. to determine Code, 128, 408; Corporation under 28 U. Ed. Radio “final” America § Judicial Miller, Cir., Co., 2 225. v. 252 H. & 298 S.C.A. Collins U.S. v. Bunnell F. 62. § J. 347, 616; 364, Cory 64 S.Ct. L.Ed. Co. v. 40 In Co., Electric Sola Electric Jefferson States, Cir., 124, Cir., (in 2 126 Bros. v. United 47 7 & Co. 122 F.2d which the 607; Nut Co. 125 judgmеnt F.2d National final resting California Co., Kelling Nut 7 134 ground, v. F.2d 532. a different was reversed appellate a matter for the This is court to Court decide, may -), whatever have been view 87 L.Ed. it was held that this Beal, Cir., court. changed by the trial Potter v. 41(b) rule had been Rule Attualita, 4 (c), 50 F. following 723c, F. U.S.C.A. section counterclaim, present case, however, In the allowing it is dismissal of a that, interesting plaintiffs to note though while “we think is an unfortunate re did not make a formal motion to dismiss sult of the rule for the reason that it re appeal and contested most strenuously quires seрarate very appeals from closely the district court’s view they that the facts cases related which would much better be alleged nullify did not hearing appeal.” effect of the combined for on one But cancellation, written nevertheless do decision the dealt with fails to note that this rule n attackthe piecemeal determination the district court’s control over actions, with have arisen in this court in some dismissal gov- judgment, only appli entry which is these cases have concerned of final above; quotеd 54(b) and cation of the rule to different situa erned Rule fact background tions consider which a based his hence it did not claim, appli See 3 and not rule itself or latter rule. Moore’s its Practice, present cation to Cum.Supp.1942, Rule situation. We think therefore, clear, (b) only modify previously it is purports aptly put as so by Mr. judgment must existing law Van Devanter Rexford Justice the v. dispose Co., matters at issue in finally of all Brunswick-Balke-Collender U. case, Miller, supra, one S. 33 S.Ct. Collins L.Ed. see disposition single complete taking requiring appellate of a case to the court fragments by appeals” and all matters connected “in successive transaction it; is a respects “wisely prevents it leaves the former result law in other which the still Unless, therefore, cir- right the postponing law untouched. the of until exist, in the rule cumstances stated is disposing there final of a decree judgment not final. is whole case.” United States v. 243.22 Acres Land, 678, 680, 2 129 of F.2d cer reason for modification States, tiorari denied Lambert v. United 54(b), Moore as Professor by Rule made -; 698, 441, 317 U.S. 63 87 S.Ct. L.Ed. 3155-3158, states, 3 Practice well is, Co., Socony-Vacuum Leonard v. 7 Oil naturally course, following from of Cir., 130 F.2d 535. actions, joinder par of of wide extent hardly present it In the case be ties, permitted under the and counterclaims questioned finality that the tests of widely separated Since procedure. new met. In fact not been the claims are so may joined even together, be transactions upon proper connected that turn sever court has discretion to though the meaning application and of a single sen- try separately, them or them lengthy tence in a ‍‌‌‌​​​‌​‌​‌​‌‌‌‌​​​‌‌‌​​​‌​​‌​​‌‌​‌‌​‌​​‌‌​​​‌‌‌‍written contract —the prevent finality as highly be undesirable quoted Clearly cancellation clause above. fact, matters. Rule separate to such In the counterclaim here involved was a com- nothing essentially 54(b) more than is pulsory one within the meaning of Rule equity providing pre-existing rule for 13(a), pleaded which had be in this ac- split (see Ad judgments in extended cases 54(b)), pressed tion it was to be at all. Hav- visory procedure hope points that these of in the aspects on all cation of the case when the triаl, with the may or evade a but shorten proper arrives.2 consequence shifting- of em unfortunate Appeal dimissed. fact, phasis form. In from merits to interlocutory appeals often inducement to FRANK, Judge (concurring). Circuit attempt oí a trial appears to come from an I think it press law I in the decision. But the abbreviation of a concur court to opinion foregoing really If to add that the beyond is feasible. such desirable suit what denied, desirability neatly of illustrates the our it seems clear abbreviation is Finkelstein, 2 lie, recоmmending changes In in appeal does not re the statutes so appeal 688; on Cir., the courts of dis- 102 v. Paid Fire as to confer St. Jones appeals Cir., 123; interlocutory Co., 5 allow 108 F.2d cretion to & Marine Ins. States, necessary prevent where to substantial in- v. 7 114 F.2d Florian United 990;1 3 Moore, justice. making pag-e The of recommendations op. supra at cit. opinions statutory judicial changes in for grant its and the same result must follow distinguished precedent.1 all aris- where does not settle matters 1 Moreover, changed hear- issues before thеm. ing its decision While the court upon hearing appeal rehearing, original an re to decide is its view is hearing by almost as burdensome as stored decision of appeal privi- jurisdiction reversing itself. Even restricted for want of Court hedged interlocutory lege appeals, judgment below, 312 of no because proper limitations, 713, such about with as 85 1305. 61 L.Ed. court, request ap- App.D.C. Farley Abbetmeier, a first to the lower v. Cf. quite pears special be other than a real to 114 F.2d under statu judge by quite labor-saving device, op. supra, tory procedure; to cit. Cum.Supp.1942, annotations to N.Y. Civil Prac- extensive Act, legislative §§ to tice reform Discussion J., appeals by per Hand, interlocutory in D. Parke-Davis & See authorize Co., C.C., perhaps beyond K. Mulford F. Co. v. H. be mission should recommending scope opinion; amendment of the the writer of this Judge Hough’s opinion patent however, suggest, Ms doubt of law. to like Refining step. Asphalt If, desirability Co. United States as of such Co., D.C., 222 F. an Petroleum Trinidad 1006, sharply with this case believes —and he criticizing attempts point example the decisions as —that arbitration, procuring usually adjudication the en piecemeal to aided in turn out Act, undesirable, he Arbitration actment to he unsuccessful by leg seq. 1 et as shown in § an C.A. but think that so direct cannot history bring up litigants Cf. Gar islative Act. vitation Ministry Justice, adjudication dozo, complete 35 Harv.L. is A eases before (1921). Appellate And the recom Rev. 113 see need courts will unfortunate. recently lending Congress hardy, indeed, made an resist mendation Mook, gone litigants in United States v. all court have ear expense bringing F.2d 706. time and such opinion, sirable) we foregoing' would, consistent, As stated in the they if were jurisdiction urge repeal the merits have no to consider provi statutory of those appeal. opinion, although sions. my part, Yet the For “piecemeal” ap obliquely, part suggests’our views on the peals provisions authorized those merits, broadly the trial for it hints out, whole, turned to be successful modify court should at least some and desirable. ap- sought to rulings which hostility enlargement to further I, too, peal. may say I to discuss itch scope interlocutory appeals is said аnd, proper, would the merits were to be based fact that cause a even, in detail. But a statute do so more expense parties waste of time and to the requires deny jurisdiction which does us Experience and the courts. indicates that to intimate what we would authorize us for probably there is more waste of time jurisdiction; decide if we could retain in the courts and intimate, do we when we so are circum- cases, volved of which the books are fact, venting however, the statute. The full, in which the courts must determine tempted that we are to do so to show serves interlocutory. or is whether an that there are cases—and this well be spectacle of a We thus have “the labor-sav obligation one—in our to dismiss ing which causes more labor than it device interlocutory appeal, juris- want of saves.” diction, hardship, unnecessary delay works important, far Aside from more injustice. consequently undeniably is the fact that there are cases course, is, It true that it would be un anyone postponement in which see require wise to from all in appellate proceed- of an decision until all rulings granted. termediate But' there ings below in the court have terminated road, Ja middle as shown the statutes will, interlocutory erroneous authorizing interlocutory appeals in con by judge, require rulings long the trial and injunctions admiralty nection in by trials could be avoided needless patent cases. statutory provi Those permitting discretionary ap- intermediate sions were- the recognition of the .fruit Bar, frequent- I I peals. was When at the the unwisdom of allowing “frag never cases;3 ly such unfortunatе encountered mentary” appeals any in cases. Those now perhaps apparent their is less unfairness opposed extending scope the of inter we us when are translated to the bench. locutory (on ground the that at tempts “piecemeal adjudication” at interlocutory usual refusal an appeal The ly may, result, turn deprive out to be party unsuccessful and in actual unde a 2 Crick, Judgment izations, a -Final The as learned are counsel able (1932) army parade Appeal, Basis 41 Yale L.J. a vast decisions the court, although 557-558. Crick’s statement more edification of the subject full reads as follows: “These consid matter involved them is en erations, then, prepare tirely should us for different from the case which is be large litigation ques ing argued.” (Emphasis added.) volume of over the judg Thompson Murphy, tion of what constitutes final In v. ment, surprised begun quasi we not be at should suit was in rem speetaele saving a labor device on substituted service as to defendants which causes more labor than it saves. were non-residents the district really seeking personam We are to determine and in as to resident defend whether is the sort decision ants. The resident defendants entered appellate hear, appearance. But, which the court wishes to on motion of spend arguing non-residents, but we our trial court entered question dismissing of whether an decision is a order the suit as to them. judgment. final As the number of The cases non-residents moved to dismiss generalizations increase, appeal ground ap which were the order past reformulated, pealed final, citing used in times must be from wаs not Col yet Miller, or cast aside for new ones which lins v. are 40 S.Ct. vague more capable or which contain words 64 L.Ed. and similar cases. meaning. of more than The motion denied was because pleadings joint Thus we create machines within machines showed there was no given liability in order to exclude or include ‍‌‌‌​​​‌​‌​‌​‌‌‌‌​​​‌‌‌​​​‌​​‌​​‌‌​‌‌​‌​​‌‌​​​‌‌‌‍sets between the resident and the may require. cases as the situation non-resident defendants. If there many joint liability, And as since so different been such kinds Court of general Appeals obliged of cases are included in thesе to dis- hand and of allowing interlocu- appeal from desirable any “an review all where tory appeals problem on the other. This likely worthless the final is decree by amending solved the statutes paid out is money already so far as the suggested. the manner amend- Hosmer, above Such Magill v. Judge concerned.” might provide ments well that failure also Lyman, (objecting Conn. appeal to seek interlocutory should not appeal denial of an in that case prevent subsequent appeal a later from a order) “Be- remarked: there was no final order.6 sides, reviewed, if the after error is law, in- determination of action at how by ap- suggested hearing It is an Years equitable delay! and ruinous the whether, pellate in its dis- court to decide may elapse place, before this event takes cretion, injustice, prevent in order it the meantime the action run interlocutory appeal should entertain an litigation the whole is round of until it ex- would be almost as burdensome as the dregs, party hausted to the and the is de- hearing merits, of the itself оn the prived property unnecessary in this con- and that for that reason would be un- beyond flict much the whole value of the wise discretionary to authorize such in- question.” prospective matter in cost terlocutory appeals.' But the burden under wastefully prolonged litigation, thus the existing substantially statutes caused, acceptance often induces of an un- great. For constantly we are having to party fair settlement who cannot af- decide interlocutory whether an order is ford outlays the financial needed to сon- appealable and not or whether it is final tinue with the trial. As the Court appealable; since there is finali- little (per Taft) said Chief : “One Justice ty to “finality,” what and it' still re- complaint causes for general mystery, mains much of a decisions on such justice administration of is the questions easy; are often no means tlje" * * litigants entails *.” Los very goes case at bar to show in de- Angeles Corp. James, Brush termining appealabíe\be- that a case is not 701, 707, 47 S.Ct. 71 L.Ed. 481. order, cause there was no final we are fre- Rights The Bills of in the Constitutions quently obliged merits; to consider many provide, States forms, in varying and this is so even we when refrain from “every person ought justice to obtain discussing opinion. them in our The bur- freely and being without obliged pur- it,” den would be little heavier if we had chase obviously principle basic power grant appeals legal system decent our discretion in a democracy. needlessly injustice. Moreover, The in order to avoid excessive cost if litigation violates principle, since, many justice requires given we should citi- jus- zens, puts prohibitive price discretiоn, glad such we should take right A tice. lost for such want of abili- labors, any; additional should ty buy right it is no at all.5 prove great, be too doubtless Con- problem The provide appointment is that of gress would for the preventing unde- sirable interlocutory appeals judges. on the of additional would have been another v. 652; lasting lasting Thompson v. Co. of New there been such earlier dismissal as to there therefore been a counsel appeal, dents miss Terminal appeal in result of this an certiorari as the sole have for several in this case and know expensive appeal. York Shares, several Murphy, supra; Thompson reversed, consequence denied joint trial the court of months, Inc., Thompson, I months, postponed was one of liability Guaranty dismissal of the expensive trial, (with 82 L.Ed. 568. non-residents. would have followed defendant) with both that, and had reversal 89 F.2d appeals Trust resi- L.J. From Federal District in whose note Land, imposes an erroneous the resident parties. waste of time and 5 The 4 Crick, Cf. United residents and there was no (1940) 1476, prevented Finality postponement Practice, needless It favor Crick, loc.cit., loc.cit., 562. States v. was and non-resident defendants 129 F.2d interlocutory only such expense money. joint liability 1482-1483; Judgment order of an 243.22 Supplement, 131, non-residents Courts, 49 an unfortunate lucky was order often Acres of made. Appeals accident between party Yale <328 given we suggested It is were also discretion, need be har- such we would dy litigants lending an ear resist gone to the time bringing applications before us. such Court, However, which has equivalent discretionary power with re- ‍‌‌‌​​​‌​‌​‌​‌‌‌‌​​​‌‌‌​​​‌​​‌​​‌‌​‌‌​‌​​‌‌​​​‌‌‌‍certiorari, sрect granting to the of writs capable refusing to lend an seems often of litigants position; ear to in a similar we, too, discretion in the who now have bail, granting setting matter of aside de- allowing faults in forma

pauperis, easily swayed by are not too applicants. efforts of the 723b, Although Act, 28 U.S.C.A. §§ 723c, which the Rules of Civil authorizes apparently precludes Procedure mak- appellate juris- ing of rules which affect diction,8 yet I think that the Committee engaged preparing proposed now revi- carefully sions of the Rules should cоnsi- problem der above discussed statutory recommend suitable changes. procedure For should be “the ‘handmaid rather justice.”9 than the mistress’ states, effect, Rule 1 purpose just, Rules is “to speedy, secure the inexpensive every determination of ac- relating tion.” The appealabil- statutes ity often frustrate purpose. that laudable

UNITED STATES v. WESTERN SHORE

LUMBER CO.

No. 10243. Appeals,

Circuit Court of Ninth Circuit.

May 1943. Clark, Jr., Samuel Atty. Gen., O. Asst. Key, Prescott, Sewall A. F. Paul S. Mc- Mahon, Gibson, and Lester Sp. L. Assts. Atty. Gen., Frank Hennessy, J. Atty., S. Phillips, Asst.,

U. Esther B. Atty., U. S. both of Francisco, Cal., San appellant. Greene, Henry Crawford A. Costigan, D. Elder, Francisco, all Scott of San Cal. (McCutchen, Olney, Greene, Mannon & 8 Practice, 9 Clark, Pleading (1928) Code Notes Rule Committee’s ing pleaded, entirely been it takes its force previous merely what had enforces contract, provision “exception” ly for matters termed been plaintiffs’ case, is a vital of subject element first as general of “distinct from recovery possible bar to of the contract litigation.” Rouge United States v. River 411, price, as a basis Co., 414, and second for claim 269 U.S. 46 S. Improvement 145, 339; expenses. an additional allowance of 144, 70 L.Ed. Collins v. Mil Ct. Complete adjudication ler, 371, of page 252 at 40 either claim or supra, counterclaim, therefore, 347, necessarily 616. This cannot be had 64 L.Ed. must so, juris do without continued resort the rules not this sentence. be affect ‍‌‌‌​​​‌​‌​‌​‌‌‌‌​​​‌‌‌​​​‌​​‌​​‌‌​‌‌​‌​​‌‌​​​‌‌‌‍powers light In fact in appel necessary our deal with the con- diction or 82; 1, ruling clusion op. late Rules cit. heretofore made has courts. provisional only, supra. the district court may well conclude hereafter further 54(b) recently Rule been au compliance reflection the cancel- thoritatively interpreted in Reeves v. may depend provision part upon lation Beardall, 62 S.Ct. parties, as asserted matters of fact L.Ed. 86 where the Court has exclusively upon rather than the conclu- adopted enforced the test it is which it has sion law heretofore made. transactions, “differing occurrences or Contracts, Rev.Ed., on Cf. Williston § separate basis which form the units of 1027A; Restatement, Agency, 454;. § 219 judicial In that action.” case different Farley W. P. & Co., Ky. White Co. v. based differing claims of 541; 292 S.W. A.L.R. Philadel- permit judg facts hеld were Storage Battery phia Co. v. Mutual Tire ment, been the that has basis of similar Stores, 161 S.C. S.E. court, opinions in which Collins Corn.L.Q. ; 45 Harv.L.Rev. 378. Metro-Goldwyn Corp., Pictures perhaps is Interlocutory appeals the most con cases other spicuous example. provided by Whatever differences than those statute times occur- ing single or affording- opportunity out of a transaction as appealing seem Oil Socony-Vacuum which rence. Leonard v. of errors quick correction for the Co., supra. course in the may havе occurred gen And since proceeding’s below. recognized clearly be It should exceptions, subject to always rule is eral type en court orders of the district tered only pre-trial when in undoubtedly will times there in essence action below are in this short-cut- case a posture of a the actual orders, provided explicitly as But seems helpful. there ruling- summary again in the Rule fragmen long run in the question no rule, judgment 56(d), when a Rule com essentially one disposal of is tary what granted. plete summary judgment merely for the is unfortunate mаtter subject expressly But such an order is the of the caused waste parties prevent mani modification “at the trial to courts, but because and the injustice.” court will fest If the district dispositions what differing mischance as make it take care in cases such this to controlling issue. essentially single type pre-trial clear its order is Moreover, experience under certain as rules, under these authorized shows, permitting- practices such recognize fully rights will then more tendency under is an unfortunate there such a power, will full have retained and as it court pure system to stress decisions should, complete adjudi make one

Case Details

Case Name: Audi Vision Inc. v. RCA Mfg. Co.

Court Name: Court of Appeals for the Second Circuit

Date Published: Jun 10, 1943

Citation: 136 F.2d 621

Docket Number: 278

Court Abbreviation: 2d Cir.