Church Mutual Insurance Co. v. Salt Lake City Laumalie Ma'oni'oni Free Wesleyan Church of Tonga

FILED
United States Court of Appeals
UNITED STATES COURT OF APPEALS Tenth Circuit

FOR THE TENTH CIRCUIT September 20, 2017
_________________________________
Elisabeth A. Shumaker
Clerk of Court
CHURCH MUTUAL INSURANCE
COMPANY,

Plaintiff Counter
Defendant - Appellee,
No. 17-4054
v. (D.C. No. 2:13-CV-00672-DS)
(D. Utah)
THE SALT LAKE CITY LAUMALIE
MA’ONI’ONI FREE WESLEYAN
CHURCH OF TONGA, a Utah non-profit
corporation; VILIAMI HOSEA, an
individual; HAVILI MONE, an individual;
MANASE VAILEA, an individual; AISEA
NAI, an individual; SIOSAIA
HAUKINIMA, an individual; LYNDON
LAUHINGOA, an individual; MELANIE
NGAUE, an individual,

Defendants - Appellants,

ETIMANI MA’AFU, an individual;
ROCKY MOUNTAIN CONFERENCE OF
THE UNITED METHODIST CHURCH, a
Colorado non-profit corporation,

Defendant Counterclaimants,

and

BOARD OF TRUSTEES OF THE
TONGAN UNITED METHODIST
CHURCH,

Intervenor Defendant.
_________________________________
 ORDER AND JUDGMENT*
_________________________________

Before HARTZ, McKAY, and MATHESON, Circuit Judges.
_________________________________

The Salt Lake City Laumalie Ma’oni’oni Free Wesleyan Church of Tonga,

Viliami Hosea, Havili Mone, Manase Vailea, Aisea Nai, Siosaia Haukinima, Lyndon

Lauhingoa, and Melanie Ngaue, (the FWC Parties), appeal the dismissal of the

complaint filed by Church Mutual Insurance Company. Church Mutual filed the

underlying declaratory judgment action to determine its insurance obligations relative

to a dispute between the FWC Parties and the remaining defendants–Etimani

Ma’Afu, Rocky Mountain Conference of the United Methodist Church (Conference),

and Board of Trustees of the Tongan United Methodist Church (the Conference

Parties). We exercise jurisdiction under 28 U.S.C. § 1291, and affirm.

I. Background

The FWC Parties and the Conference Parties filed lawsuits in state court

alleging various claims, including conversion, breach of fiduciary duty, and the right

to control the Tongan United Methodist Church. Mr. Ma’Afu and the Conference

tendered the state-court claims to Church Mutual for indemnity and defense

coverage.

*
After examining the briefs and appellate record, this panel has determined
unanimously to honor the parties’ request for a decision on the briefs without oral
argument. See Fed. R. App. P. 34(f); 10th Cir. R. 34.1(G). The case is therefore
submitted without oral argument. This order and judgment is not binding precedent,
except under the doctrines of law of the case, res judicata, and collateral estoppel. It
may be cited, however, for its persuasive value consistent with Fed. R. App. P. 32.1
and 10th Cir. R. 32.1.
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 Church Mutual then filed this action seeking a judicial declaration as to its

coverage obligations, naming as defendants all parties to the underlying state-court

litigation. Church Mutual and the Conference Parties filed cross-motions for

summary judgment; the FWC Parties did not respond to either motion. The district

court denied Church Mutual’s motion and granted the Conference Parties’ motion.

Church Mutual appealed to this court, which affirmed in part and reversed in part.

See Church Mut. Ins. Co. v. Ma’Afu, 657 F. App’x 747 (10th Cir. 2016). Church

Mutual and the Conference Parties then reached a full settlement and filed a

stipulation for dismissal with prejudice of the claims between them. The district

court approved the stipulation for dismissal on February 16, 2017.

Church Mutual filed a motion under Fed. R. Civ. P. 41(a)(2) to dismiss the

claims against the FWC Parties, which were the only claims remaining. Although the

district court initially ruled on Church Mutual’s motion to dismiss before the FWC

Parties responded, the court thereafter considered the FWC Parties’ opposition to

dismissal and entered a subsequent order dismissing the action with prejudice.

II. Discussion

“Once a defendant files an answer, as was the case here, a plaintiff may

voluntarily dismiss an action only upon order of the court.” Ohlander v. Larson,

114 F.3d 1531, 1536-37 (10th Cir. 1997) (citing Fed. R. Civ. P. 41(a)(2)). The

purpose of Rule 41(a)(2) is “primarily to prevent voluntary dismissals which unfairly

affect the other side, and to permit the imposition of curative conditions.” Clark v.

Tansy, 13 F.3d 1407, 1411 (10th Cir. 1993) (internal quotation marks omitted).

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 “We review a district court’s grant of a Rule 41(a)(2) motion for abuse of

discretion.” Cty. of Santa Fe v. Pub. Serv. Co. of N.M., 311 F.3d 1031, 1047

(10th Cir. 2002). “This circuit has defined an abuse of discretion as an arbitrary,

capricious, or whimsical judicial determination.” Clark, 13 F.3d at 1411.

Generally, a court should grant dismissal “[a]bsent ‘legal prejudice’ to the

defendant.” Ohlander, 114 F.3d at 1537. Factors relevant to evaluating “legal

prejudice” are “the opposing party’s effort and expense in preparing for trial;

excessive delay and lack of diligence on the part of the movant; insufficient

explanation of the need for a dismissal; and the present stage of litigation.” Id.

The FWC Parties contend that dismissal was improper because the dismissal

did not vindicate their rights or resolve the controversy that still exists. They

maintain that duplicative litigation will be necessary to resolve the disputes and

clarify Church Mutual’s obligations to them. They argue that dismissal will cause

them “legal prejudice” because they “participated in the litigation . . . in anticipation

of a specific declaration by the district court with regards to Church Mutual’s

obligations to [them].” Aplt. Br. at 4. The FWC Parties have not, however,

identified any extant disputes or controversies, nor have they explained how Church

Mutual may remain obligated to them. We will not consider these arguments because

they are “vague . . . and unsupported by legal argument or record evidence.”

DePaula v. Easter Seals El Mirador, 859 F.3d 957, 967 (10th Cir. 2017) (internal

quotation marks omitted). Even so, the doctrine of res judicata, also known as claim

preclusion, would preclude the parties from engaging in duplicative litigation.

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See Lenox MacLaren Surgical Corp. v. Medtronic, Inc., 847 F.3d 1221, 1239

(10th Cir. 2017) (“The doctrine of res judicata, or claim preclusion, will prevent a

party from litigating a legal claim that was or could have been the subject of a

previously issued final judgment.” (internal quotation marks omitted)). In addition,

any threat of duplicative litigation is obviated by the dismissal with prejudice. See

Cty. of Santa Fe, 311 F.3d at 1049 (noting that a dismissal with prejudice “precludes

any future suit by the plaintiff”).

The FWC Parties appear to rely on the factor pertaining to their effort and

expense in preparing for trial to argue against dismissal. But they were not required

to prepare for trial. Their filings were limited to an answer, responses to intervention

and discovery, and a motion for partial summary judgment (which was denied on

May 13, 2014). They do not argue that the remaining criteria favor their position,

and we do not see that they do. Therefore, we find no abuse of discretion in the

district court’s dismissal with prejudice.

The FWC Parties’ fundamental argument in challenging dismissal is that

Church Mutual should be required to pay their attorney fees and costs incurred in the

case. See Aplt. Br. at v (framing issue on appeal as whether the district court abused

its discretion by dismissing without awarding the FWC Parties their attorney fees and

costs). Under the American rule, parties to a lawsuit ordinarily pay their own

attorney fees. Alyeska Pipeline Serv. Co. v. Wilderness Soc’y, 421 U.S. 240, 247

(1975). Although there are exceptions to this principle, such as statutory fee-shifting

provisions, see Pound v. Airosol Co., 498 F.3d 1089, 1101 (10th Cir. 2007), the FWC

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Parties have identified no such exceptions. Thus, the district court did not abuse its

discretion in granting dismissal without awarding the FWC Parties their attorney fees

and costs. See id. at 1100-01 (stating district court’s decision on an award of

attorney fees is reviewed for abuse of discretion).

III. Conclusion

The FWC Parties’ request for an award of attorney fees and costs on appeal is

denied. The judgment is affirmed.

Entered for the Court

Monroe G. McKay
Circuit Judge

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