Philip F. Bowling and Jennie M. Bowling v. U.S. Bank National Association, as Trustee for C-Bass Mortgage Loan Asset-Backed Certificates, Series 2007-SP2 Ocwen Loan Servicing, LLC and Litton Loan Servicing, LP

Rel: February 17, 2023

Notice: This opinion is subject to formal revision before publication in the advance sheets of Southern
Reporter. Readers are requested to notify the Reporter of Decisions, Alabama Appellate Courts,
300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-0650), of any typographical or other
errors, in order that corrections may be made before the opinion is printed in Southern Reporter.

SUPREME COURT OF ALABAMA
OCTOBER TERM, 2022-2023

_________________________

SC-2022-0762
_________________________

Philip F. Bowling and Jennie M. Bowling

v.

U.S. Bank National Association, as Trustee for C-Bass Mortgage
Loan Asset-Backed Certificates, Series 2007-SP2; Ocwen Loan
Servicing, LLC; and Litton Loan Servicing, LP

Appeal from Jefferson Circuit Court
(CV-12-903803)
SC-2022-0762

MITCHELL, Justice.

Rule 54(b) of the Alabama Rules of Civil Procedure gives a trial

court discretion to certify a partial judgment as final, and thus

immediately appealable, even though some piece of the case remains

pending in the trial court. This appeal stems from a Rule 54(b)

certification. For reasons explained below, we conclude that the

Jefferson Circuit Court ("the trial court") exceeded its discretion in

certifying its partial judgment as immediately appealable. Because an

improper Rule 54(b) certification cannot support an appeal on the merits

of the underlying judgment, we dismiss this appeal for lack of

jurisdiction.

Facts and Procedural History

Philip F. Bowling and Jennie M. Bowling purchased their house in

Vestavia Hills via a promissory note in 1986. The loan was secured by a

mortgage, which was eventually assigned to U.S. Bank National

Association ("U.S. Bank"). A little over a decade later, the Bowlings

began missing loan payments. Litton Loan Servicing, LP ("Litton"), the

original servicer for the loan, sent the Bowlings several notices of default

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between July 1999 and June 2011, before eventually transferring service

of the loan to another entity, Ocwen Loan Servicing, LLC ("Ocwen").

In September 2011, Ocwen allegedly notified the Bowlings that

they were in default. Ocwen then scheduled a foreclosure sale, which

took place in October 2012. A company called WGB, LLC ("WGB"),

purchased the Bowlings' house at the foreclosure sale, but the Bowlings

refused to vacate the property. A few weeks later, WGB filed an

ejectment action against them.

The Bowlings answered by asserting that they had not defaulted on

the loan and that the foreclosure sale was invalid. The Bowlings also

named as third-party defendants U.S. Bank, Ocwen, and Litton (which

we, in keeping with the trial court's practice, refer to collectively as "the

banks"), alleging that the banks had mishandled the loan, the foreclosure

sale, and related matters. In total, the Bowlings asserted 15 third-party

claims against the banks, captioned as follows: negligence; wantonness;

wrongful foreclosure; slander of title; breach of contract; fraud; false

light; defamation, libel, slander; violations of the Truth in Lending Act;

violations of the Real Estate Settlement Procedures Act; violations of the

Fair Credit Reporting Act; intentional infliction of emotional distress;

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declaratory relief; unjust enrichment; and violations of the Fair Debt

Collection Practices Act.

WGB promptly moved for summary judgment on its ejectment

claim, but -- before that motion could be heard -- the banks removed the

action to federal court, where the parties litigated the case for several

years. In 2020, however, the United States Court of Appeals for the

Eleventh Circuit ordered that the case be remanded back to state court

in accordance with an intervening decision from the United States

Supreme Court in Home Depot U.S.A., Inc. v. Jackson, 587 U.S. ___, 139

S. Ct. 1743 (2019), which held that third-party defendants (such as the

banks in this case) are not permitted to remove cases to federal court.

See Bowling v. U.S. Bank Nat'l Ass'n, 963 F.3d 1030 (11th Cir. 2020).

Back in the trial court, the banks moved for summary judgment on

the Bowlings' claims against them. The Bowlings, in turn, filed their own

motion for partial summary judgment against the banks, seeking to have

the foreclosure sale set aside as void. After the motions had been fully

briefed, the trial court entered summary judgment in favor of the banks

on 12 of the Bowlings' 15 claims, leaving pending the Bowlings' claims

for wrongful foreclosure, breach of contract, and declaratory relief.

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Separately, the trial court granted the Bowlings' motion for partial

summary judgment, setting aside the foreclosure sale as "null and void."

The trial court also denied WGB's motion for summary judgment on its

ejectment claim.

In the aftermath of those rulings, WGB amended its complaint to

add five claims against the banks, alleging in broad outline that the

banks had mishandled the foreclosure and related matters. WGB's

claims were captioned: misrepresentation; breach of contract; unjust

enrichment; money had and received; and negligence/wantonness. Each

of these claims, along with WGB's ejectment claim against the Bowlings,

remains pending in the trial court.

Meanwhile, the banks filed a motion for partial reconsideration of

the trial court's ruling on their summary-judgment motion, essentially

asking the trial court to dismiss the Bowlings' three remaining claims

against them. The trial court granted that motion and revised its original

order to enter summary judgment in favor of the banks on all the

Bowlings' claims. The Bowlings then filed their own motion to

reconsider, which the trial court denied. In its order denying the

Bowlings' motion to reconsider, the trial court -- for the first time and

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without explanation -- certified its summary-judgment order disposing of

the Bowlings' claims as immediately appealable under Rule 54(b).1 The

Bowlings timely appealed.

Analysis

The Bowlings' appellate briefs argue primarily that the trial court's

summary-judgment ruling should be reversed on the merits. In the

alternative, the Bowlings argue that the trial court erred by certifying its

ruling as immediately appealable. Because we agree with the latter

argument, we do not reach the former.

Except as otherwise provided by law, an appeal lies only from a

final judgment -- that is, a judgment disposing of all claims against all

parties. Wright v. Harris, 280 So. 3d 1040, 1043 (Ala. 2019). Rule 54(b)

provides one such exception:

"When more than one claim for relief is presented in an action,
whether as a claim, counterclaim, cross-claim, or third-party

1Although the trial court's order does not mention Rule 54(b) by
name, it invokes that rule in substance by stating: "As there is no just
reason for delay, the Court hereby DIRECTS the entry of a final
judgment as to claims plead by [the Bowlings] against [the banks]
(ONLY)." As we have held in other cases, the trial court's recitation of
the "no just reason for delay" language is "sufficient to indicate an intent
to certify an order as a final order under Rule 54(b)," even if the trial
court does not cite the rule expressly. Elkins v. Carroll, 220 So. 3d 290,
297 (Ala. 2016).
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claim, or when multiple parties are involved, the court may
direct the entry of a final judgment as to one or more but fewer
than all of the claims or parties only upon an express
determination that there is no just reason for delay and upon
an express direction for the entry of judgment."

In short, Rule 54(b) permits a trial court to certify a partial judgment as

"final," and thus immediately appealable, even though some claims

remain pending. Wright, 280 So. 3d at 1043. But that authority is

conditioned on the trial court's determination that "there is no just reason

for delay," and we review that determination for excess of discretion. Id.

This Court has repeatedly emphasized that " ' " '[c]ertifications

under Rule 54(b) should be entered only in exceptional cases,' " ' " because

piecemeal appeals -- which typically entail considerable delay and

expense -- are disfavored. Fuller v. Birmingham-Jefferson Cnty. Transit

Auth., 147 So. 3d 907, 911 (Ala. 2013) (quoting Dzwonkowski v. Sonitrol

of Mobile, Inc., 892 So. 2d 354, 363 (Ala. 2004)); see also Wright, 280 So.

3d at 1043 (" ' " [C]ertifications under Rule 54(b) are disfavored." ' "

(citations omitted)); Highlands of Lay, LLC v. Murphree, 101 So. 3d 206,

209 (Ala. 2012) (" ' "It is uneconomical for an appellate court to review

facts on an appeal following a Rule 54(b) certification that it is likely to

be required to consider again when another appeal is brought after the

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[trial] court renders its decision on the remaining claims or as to the

remaining parties." ' " (citations omitted)).

In keeping with that general principle, we have consistently held

that a trial court exceeds its discretion in certifying a judgment under

Rule 54(b) if " ' " the issues in the claim being certified and a claim that

will remain pending in the trial court ' " are so closely intertwined that

separate adjudication would pose an unreasonable risk of inconsistent

results." ' " ' " Id. at 208 (citations omitted).

A few examples from our precedents illustrate the point. In Fuller,

for instance, employees sued several defendants responsible for

administering the employee's retirement plan after the defendants had

decided to reduce their benefits. The employees alleged breach of

contract, conversion, breach of fiduciary duty, and bad faith. The

defendants, in turn, brought a counterclaim to recoup benefits previously

paid to the employees. The trial court entered summary judgment in

favor of the defendants on the employees' claims and certified that

judgment as final, even though the counterclaim remained pending. This

Court unanimously held that the "factual underpinnings of the

adjudicated claims are the same as those of the unadjudicated

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counterclaim" and, accordingly, dismissed the appeal as stemming from

an improper Rule 54(b) certification. Fuller, 147 So. 3d at 913.

This Court reached a similar conclusion in Centennial Associates,

Ltd. v. Guthrie, 20 So. 3d 1277 (Ala. 2009). There, a limited partnership

owned real property that it used for business purposes. Two limited

partners sued two general partners, alleging that the general partners

had twice wrongfully transferred the partnership's interest in property

and had not disbursed payments from those transfers to the limited

partners. The limited partners' complaint stated claims of fraud,

conversion, suppression, and breach of fiduciary duty. The limited

partners also brought malpractice-related claims against the attorney

who had prepared the closing documents for those transactions. The trial

court entered summary judgment for the attorney on one of the

malpractice-related claims, based on its determination that the

partnership had no interest in the property at the time of the relevant

transaction. It then certified that judgment as final under Rule 54(b),

leaving the other claims pending. This Court held that resolution of the

unadjudicated claims would require resolution of "the same issue" as the

adjudicated claims, namely whether the partnership owned an interest

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in the property during the relevant period. This Court therefore held

that the claims were so closely intertwined that separate adjudication

would pose an unreasonable risk of inconsistent results, and dismissed

the appeal.

In that same vein is Branch v. SouthTrust Bank of Dothan, N.A.,

514 So. 2d 1373 (Ala. 1987), which involved a bank suing a borrower to

recover money owed on a promissory note. The borrower counterclaimed,

asserting that an agent of the bank had made a fraudulent

misrepresentation in order to induce him to execute the note. The trial

court entered summary judgment in favor of the bank on its claim and

certified that judgment as final under Rule 54(b), but it left the

borrower's fraudulent-misrepresentation counterclaim pending. We held

that the certification was improper because of the obvious factual overlap

between the claim and the counterclaim.

This case is cast in the same mold as Fuller, Centennial Associates,

and Branch. Here, the trial court certified as final its judgment on the

Bowlings' claims against the banks, even though a slew of related claims

-- claims arising out of the same fact pattern and involving overlapping

allegations and evidence -- remain pending below. For instance, the

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Bowlings' negligence and wantonness claims (which the trial court

dismissed on the merits) alleged that the banks had wrongfully handled

the loan and the foreclosure in violation of the mortgage agreement, an

allegation that also plays a central role in WGB's still-pending claims

against the banks for misrepresentation and negligence/wantonness.

The Bowlings also alleged, as part of several of their claims (which the

trial court also dismissed on the merits), that the banks had disseminated

false information related to the loan, while WGB's still-pending

misrepresentation claim likewise turns on the allegation that the banks

had made false representations about the way in which they serviced the

loan and conducted the foreclosure sale. In addition, the Bowlings and

WGB each brought parallel unjust-enrichment claims against the banks,

alleging that the banks had unfairly profited from the foreclosure sale.

As these examples make clear, the Bowlings' adjudicated claims and

WGB's pending claims ultimately center on the same basic theory --

namely, that the banks had mishandled the foreclosure.

This is precisely the type of case in which this Court has held that

certification under Rule 54(b) is inappropriate. Yet the trial court offered

no explanation for its determination that piecemeal adjudication in this

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instance is necessary or even desirable, 2 and we cannot discern any

support for that determination from the record. We therefore conclude

that the trial court exceeded its discretion in certifying its judgment as

final under Rule 54(b), and we dismiss this appeal as arising from a

nonfinal judgment.

APPEAL DISMISSED.

Parker, C.J., and Shaw, Bryan, and Mendheim, JJ., concur.

2Notably, the banks do not even attempt to defend the trial court's
certification decision in their brief, despite the Bowlings' repeated
challenges to that decision in their initial brief.
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