Several parties sued Forster/Krebs and B&B Hot Oil for damages. Forster/Krebs cross-claimed against B&B Hot Oil and JB's Welding for damages related to the destruction of the building and the contents.

Forster/Krebs ultimately alleged claims against B&B Hot Oil for breach of contract, negligence, res ipsa loquitur, and strict products liability, and against JB's Welding for negligence, strict products liability, and concerted action and a joint venture with B&B Hot Oil.

The trial court granted summary judgment dismissing all of Forster/Krebs' cross-claims against B&B Hot Oil, ruling that Forster/Krebs had waived their right to recover damages to their property under the provisions of the lease agreement with B&B Hot Oil and that Forster/Krebs' insurer, Acuity, was not entitled to subrogation from B&B Hot Oil. The trial court denied Forster/Krebs' motion to amend their pleadings against B&B Hot Oil. The trial court also granted summary judgment dismissing Forster/Krebs' claims against JB's Welding for concerted action and a joint venture with B&B Hot Oil.

Forster/Krebs' remaining claims against JB's Welding for negligence and strict products liability were scheduled for a jury trial on March 9, 2017. On February 10, 2017, a stipulation for the voluntary dismissal without prejudice of Forster/Krebs' remaining claims against JB's Welding was filed in the trial court. In the filed stipulation, which was signed by counsel for Forster/Krebs and counsel for JB's Welding, Forster/Krebs and JB's Welding agreed that the trial court should enter an order dismissing Forster/Krebs' claims against JB's Welding without prejudice.

The trial court subsequently signed an order dismissing Forster/Krebs' claims against JB's Welding without prejudice and a judgment was entered dismissing those claims without prejudice. The effect of that judgment disposed of all the claims in the lawsuit.

Forster/Krebs appealed to the North Dakota Supreme Court from the judgment, arguing that the trial court had erred in:

(1) Dismissing their claims against B&B Hot Oil and their insurer's subrogation claim against B&B Hot Oil;

(2) Denying their motion to amend their pleadings against B&B Hot Oil; and

(3) Dismissing with prejudice their claims against JB's Welding for concerted action and a joint venture.

B&B Hot Oil moved to dismiss Forster/Krebs' appeal and JB's Welding filed a brief in support of that motion. B&B Hot Oil and JB's Welding contended that the North Dakota Supreme Court lacked appellate jurisdiction to hear the appeal because the dismissal without prejudice of Forster/Krebs' remaining claims against JB's Welding circumvented N.D.R.Civ.P. 54(b) and created an artificial final judgment for purposes of appeal.

Forster/Krebs opposed the motion to dismiss, arguing that their appeal was from a final judgment and that the North Dakota Supreme Court had jurisdiction to hear the appeal.

The North Dakota Supreme Court's Decision

The court dismissed the appeal.

In its decision, the court explained that the right to appeal in North Dakota was governed by statute and if there was no statutory basis to hear an appeal, it had to be dismissed. Moreover, the court added, only those judgments and decrees that constituted "a final judgment of the rights of the parties to the action and orders enumerated by statute" were appealable.

The court also observed that it would not consider an appeal in a multi-claim or multi-party lawsuit that disposed of fewer than all the claims against all the parties unless the trial court first had independently assessed the case and determined that a certification under N.D.R.Civ.P. 54(b) was appropriate.

The court pointed out that it had not previously considered the extent of its jurisdiction in situations where parties had voluntarily dismissed remaining claims without prejudice to effectuate a final disposition of all the claims in a multi-claim or multi-party lawsuit to circumvent N.D.R.Civ.P. 54(b) and create a final judgment for purposes of appellate jurisdiction.

The court then adopted a "bright-line approach" providing that if there was a dismissal without prejudice of remaining non-adjudicated claims to create a final disposition of all claims in a lawsuit, there was "not a final judgment of the rights of the parties."

The stipulation filed in the trial court to dismiss without prejudice Forster/Krebs' remaining unadjudicated claims against JB's Welding purported to toll the statute of limitations for those claims pending appeal and did not have the effect of terminating those claims, the court found. Under these circumstances, it ruled, dismissal without prejudice did not dispose of all of the claims and was not final. Lacking a final judgment or proper N.D.R.Civ.P. 54(b) certification, the court concluded, there was no right to appeal.

The case is James Vault & Precast Co. v. B&B Hot Oil Service, Inc., No. 20170130 (N.D. March 1, 2018). Attorneys involved include: Randall J. Bakke (argued) and Shawn A. Grinolds (on brief), Bismarck, ND, for appellants Steve Forster, Daniel Krebs, and Debra D. Krebs. Nicholas C. Grant (argued), Randall N. Sickler (on brief), Allison R. Mann (on brief), Dickinson, ND, and Zachary E. Pelham (appeared), Bismarck, ND, for appellee B&B Hot Oil Service, Inc. Lawrence E. King (argued) and Alyssa L. Lovas (appeared), Bismarck, ND, for appellee JB's Welding. James Vault & Precast Co., Donna Bline, Melvin Zent, Thomas Kuntz, Dave Olheiser and Jerry Kram, plaintiffs; no appearance. St. Paul Surplus Lines Insurance Company, defendant and third-party plaintiff; no appearance. Acuity, a Mutual Insurance Company, third-party defendant; no appearance.