Choice Hotels International, Inc. v. Goodwin & Boone

BRITT, District Judge,

dissenting:

Believing that the district court’s order was sufficiently clear to inform a reasonable attorney that the case would be dismissed with prejudice if no motion to reopen was filed within thirty days of entry of the court’s Order and that the district court’s order of dismissal was proper under both the local and federal rules of procedure, I respectfully dissent.

The majority correctly notes that dismissal of an action at the plaintiff’s request is governed by Rule 41(a)(2) of the Federal Rules of Civil Procedure. However, a decision in this case is not limited to a consideration of that rule. Also involved is Local Rule 111.1 of the Maryland District Court which provides, in pertinent part, as follows:

When the Court has been notified by counsel that a case has been settled, the Court may enter an order dismissing the case and providing for the payment of costs. Such an order of dismissal shall be without prejudice to the right of a party to *474move for good cause to reopen the case ■within a time set by the Court if the settlement is not consummated. Alternatively, the Court, upon being notified by counsel that a case has been settled, may require counsel to submit within sixty (60) days a proposed order providing for settlement, in default of which the Court may enter such judgment or other order as may be deemed appropriate.
An order entered pursuant to this Rule means that the entire case, including all claims, counter-claims, cross-claims, third-party claims and claims for attorney’s fees and costs has been settled, unless otherwise stated in the order.

On being advised that the case had been settled, the district judge, on 17 October 1989, entered the following order:

SETTLEMENT ORDER

(LOCAL RULE 111.1)

This Court, having been advised by the parties that the above action has been settled, including all counterclaims, cross-claims and third-party claims, if any,
IT IS ORDERED that this action is hereby dismissed with each party to bear its own costs unless otherwise agreed, in which event the costs shall be adjusted between the parties. The entry of this Order is without prejudice to the right of a party to move for good cause within 30 days to reopen this action if settlement is not consummated.

Over two years later, on 20 December 1991, plaintiff filed the identical suit. Defendant moved to dismiss and, not surprisingly, the district court allowed the motion. This Court now reverses on the stated basis that the order of dismissal was not sufficiently “explicit and clear” in specifying that the dismissal was with prejudice. I fear that this decision will effectively eviscerate Maryland Local Rule 111.1, and that it will do so on a basis that, with all respect, I believe is not warranted.

This is not a case in which plaintiff alone sought dismissal under Rule 41. Nor is it a case in which both parties simply sought dismissal of the case without a specified reason, which could have been done without court approval and would have preserved plaintiffs right to refile at any time subject, of course, to applicable statutes of limitation.1 Rather, it is a case in which plaintiff represented to the judge that the parties had arrived at a settlement. Counsel for plaintiff was, presumably, familiar with the local rules.2 No doubt if counsel thought that thirty days was an insufficient time within which to conclude settlement, he could have requested and the trial judge would have given longer than thirty days. However, counsel for plaintiff did not, within the thirty days allotted by the order, refile his case or move the court for additional time within which to perfect the settlement. Instead, he ignored the order. Over two years later, obviously susceptible to a malpractice claim, he refiled the action, expecting the court to rescue him from his predicament. The district court refused to do so and I decline to join this Court in extending an undeserved reprieve to a careless attorney.

As the majority recognizes, two significant goals can be furthered by use of explicit, clear language: First, ensuring fairness to plaintiffs or to any party detrimentally affected by a dismissal with prejudice, and second, fostering “sound judicial practice.” In my view, these interests are better served when local rules are followed and enforced. To fail to do so leaves this plaintiff free to blithely ignore the conditions specified by the district court.

I cannot agree that the order of dismissal did not make “clear” that the dismissal was with prejudice unless the action was refiled within thirty days. The operative sentence in the order said: “The entry of this Order is without prejudice to the right of a party to *475move for good cause within 30 days to reopen this action if settlement is not consummated.” 3 I fail to see how the risk of failing to refile could have been made any more clear. If a party can refile within thirty days without prejudice, surely there is prejudice in attempting to do so after expiration of the time limit. Even without knowledge of the Maryland local rule it should be abundantly clear that if either party desired to reopen the ease it had to do so within thirty days.4 Taking into account plaintiffs counsel’s presumed familiarity with local rules in the district in which he practices, this reasoning is all the more compelling.

Trial courts are under constant pressure to dispose of the business of the court in a timely and cost-effective manner. They are criticized when they take too much time in disposing of cases or when the costs of litigation rise. Congress passed the Civil Justice Reform Act of 1990 which, among other things, required each United States District Court to convene a Local Advisory Group on Expense and Delay Reduction to study the way in which the court does its business and to make recommendations for changes to reduce expense and promote earlier resolution of civil disputes. To this end, district courts depend on their local rules for effective management of their dockets. Most recommendations of Local Advisory Groups will, of necessity, be implemented through local rules. If they are to be effective, they must have the respect of the public, particularly the bar, and the support of the bench. As the trial judge said in dismissing this action:

The finality of settlements is essential to the functioning of this Court. If parties are permitted to disrupt settlements more than two years after they have informed the Court that a matter is resolved, the settlements become meaningless.

I do not agree that the district court’s assessment could be faulted in this case. I am concerned that by rejecting it, the majority’s decision will encourage other litigants and counsel to believe that they too can disregard the plain meaning of conditions imposed on them in orders of dismissal under Rule 41. While I agree with the majority that there is a preference for disposing of eases on their merits and avoiding dismissals based on technicalities, that preference does not outweigh the equally important tenet that local rules are meant to be followed.

. Rule 41(a)(1) provides in part: "Subject to the provisions of Rule 23(e), of Rule 66, and of any . statute of the United States, an action may be dismissed by the plaintiff without order of court ... by filing a stipulation of dismissal signed by all parties who have appeared in the action. Unless otherwise stated in the notice of dismissal or stipulation, the dismissal is without prejudice. ...”

. Counsel for plaintiff lists a Baltimore address.

. The order could have said: "The entry of this Order is with prejudice, unless a party moves within 30 days to reopen the action because the settlement has not been consummated.” Surely then there would have been no question that it was clear and explicit. Yet, the similarity in wording and meaning is apparent, or should have been to any reasonably competent and responsible lawyer.

. Moving to reopen and refiling the identical case are, of course, the same.