Shelli R. Freer, Individually and as Administrator of the Estate of Michael Sansom, Individually v. DAC, Inc. d/b/a Prairie House ( 2019 )

IN THE SUPREME COURT OF IOWA
No. 17–1825
Filed June 14, 2019
SHELLI R. FREER, Individually and as Administrator of the Estate of
NICOLE J. SANSOM and MICHAEL SANSOM, Individually,
Appellants,
vs.
DAC, INC. d/b/a PRAIRIE HOUSE,
Appellee.
Appeal from the Iowa District Court for Jackson County, Mark J.
Smith, Judge.
The plaintiffs challenge the district court’s grant of motion to enforce
settlement agreement and dismissal of plaintiffs’ posttrial motion as moot.
AFFIRMED.
Thomas W. Kyle of Hupy and Abraham, S.C., P.C., Milwaukee, WI,
for appellants.
Patrick L. Woodward and Ryan F. Gerdes of McDonald, Woodward
& Carlson, P.C., Davenport, for appellee.
2
CHRISTENSEN, Justice.
Plaintiffs appeal the district court’s dismissal of their posttrial
motion. Upon review, we consider plaintiffs’ posttrial motion waived.
Accordingly, plaintiffs did not preserve any issues for appellate review. We
affirm the district court’s order entering judgment for defendant.
I. Background Facts and Proceedings.
A jury trial was held on the wrongful death of Nicole Sansom.
During deliberations, counsel for each party entered into a high-low
settlement agreement. The written agreement consisted of the plaintiff
Freer 1 emailing a one-liner to the defendant DAC, Inc. and DAC emailing
a one-liner in response:
Freer: “They agree to the high low of 100k to 1 million.”
DAC: “Confirmed. Now we wait and see what the jury does.”
Later that same day, the jury determined DAC was not liable and awarded
no damages. On July 25, 2017, the district court entered judgment for
DAC. On August 2, Freer filed a timely posttrial combined motion for new
trial and change of venue. See Iowa R. Civ. P. 1.1007 (posttrial motion for
new trial must be filed within fifteen days after filing of the verdict). The
posttrial motion alleged violation of a granted motion in limine, errors by
the district court in denying Freer’s motions for mistrial and failing to
notify counsel of jury communications, and undue influence of DAC over
the jury. DAC resisted and filed a motion to enforce the high-low
settlement agreement and to strike Freer’s posttrial motion.
On October 13, the district court held a hearing on the motions. It
granted DAC’s motion to enforce the settlement agreement and deemed
Freer’s posttrial motion moot. The district court pronounced this
1Because Shelli Freer and Michael Sansom are in the same position in this appeal,
we will refer to them both as “Freer.”
3
judgment from the bench. Nonetheless, on November 7, before the entry
of a written order on the posttrial motion, Freer appealed. 2 DAC timely
cross-appealed the district court’s judgment. See Iowa R. Civ. P.
6.101(2)(b) (notice of cross-appeal must be filed within ten days after the
filing of a notice of appeal). On appeal, Freer argues it was error for the
district court to determine the posttrial motion as moot. She also asserts
the high-low settlement agreement does not preclude the district court
from hearing arguments and rendering a determination as to the propriety
of the posttrial motion. Freer lastly contends the district court abused its
discretion in denying the motions for mistrial. DAC argues the district
court erred in denying its motion to exclude expert testimony and in
granting Freer’s motion in limine.
We retained the appeal. However, we determined the jurisdictional
requirement of Iowa Rule of Appellate Procedure 6.101(1)(b) was not met.
Rule 6.101(1)(b) requires “[a] notice of appeal must be filed within 30 days
after the filing of the final order or judgment.” Iowa R. App. P. 6.101(1)(b)
(emphasis added). We previously addressed this jurisdictional
requirement in Lutz v. Iowa Swine Exps. Corp., 300 N.W.2d 109, 112 (Iowa
1981). We concluded “an oral order may be probative evidence as to the
effective time of an order, but until it is in some manner reduced to writing
and filed there is no competent evidence of the rendition of such order.”
Id. To support this conclusion, we cited caselaw stating “[t]he reason for
requiring orders to be made in writing and recorded is that the court might
change its ruling before the order is signed and entered.” Id. at 111–12.
2Freer’s posttrial motion for new trial tolled the thirty-day period within which to
file an appeal. Iowa R. App. P. 6.101(1)(b) (providing a notice of appeal must be filed
thirty days after the filing of the order on the motion for new trial); Lutz v. Iowa Swine
Exps. Corp., 300 N.W.2d 109, 110 (Iowa 1981).
4
The jurisdictional rule at issue in Freer’s appeal expressly identified
that a final order or judgment must be filed before an appeal can be
pursued. See Iowa R. App. P. 6.101(1)(b). Accordingly, we remanded to
the district court for the limited purpose of entry of a written order, nunc
pro tunc, on the posttrial motion. 3 On February 15, 2019, the district
court filed a written order that enforced the high-low settlement agreement
and denied Freer’s posttrial motion. 4
II. Standard of Review.
A motion to enforce a settlement agreement is reviewed for
correction of errors at law. Wright v. Scott, 410 N.W.2d 247, 249–50 (Iowa
1987). “The district court has authority to enforce settlement agreements
made in a pending case.” Gilbride v. Trunnelle, 620 N.W.2d 244, 249 (Iowa
2000).
III. Analysis.
Upon review, we consider Freer’s posttrial motion waived. A moving
party is deemed to have waived and abandoned a posttrial motion when
that party files a notice of appeal. IBP, Inc. v. Al-Gharib, 604 N.W.2d 621,
628 (Iowa 2000); In re Estate of Herron, 561 N.W.2d 30, 32 (Iowa 1997).
Freer is the same party who filed the posttrial motion and who filed the
notice of appeal. Therefore, Freer is deemed to have waived and
abandoned her posttrial motion. See Lemke v. Albright, 383 N.W.2d 520,
522 (Iowa 1986) (reasoning if the abandonment of a posttrial motion
perfected the appeal, logically an appeal is not abandoned by relying on a
posttrial motion to extend time for appeal beyond the thirty-day period). A
3See Iowa R. App. P. 6.1004 (“The appropriate appellate court may on its own
motion . . . remand a pending appeal to the district court, which shall have jurisdiction
to proceed as directed by the appellate court.”).
4On February 18, 2019, the district court entered a second written nunc pro tunc
order to correct a typographical error in the February 15 order.
5
jurisdictional problem will not arise because the appeal is considered
taken as a matter of right. IBP, Inc., 604 N.W.2d at 628. “An appeal is
taken and perfected by filing a notice of appeal with the clerk of court
where the order, judgment or decree was entered.” Wolf v. City of Ely, 493
N.W.2d 846, 848 (Iowa 1992) (en banc). In filing the notice of appeal, Freer
divested the district court of jurisdiction over the posttrial motion. See
IBP, Inc., 604 N.W.2d at 628 (“Additionally, once the appeal is perfected,
the district court loses jurisdiction to rule on the motion, and any such
ruling has no legal effect.”). “The general rule that the district court loses
jurisdiction when an appeal is perfected has application when the appeal
is taken before the filing of posttrial motions.” Wolf, 493 N.W.2d at 848
(holding notice of appeal conferred jurisdiction onto the appellate court
and divested the district court of jurisdiction to rule on the posttrial
motion). Therefore, Freer waived the posttrial motion and divested the
district court of jurisdiction. See IBP, Inc., 604 N.W.2d at 628.
Our consideration of the jurisdictional issue is not precluded by the
law of the case doctrine, which is “discretionary when applied to a
coordinate court or the same court’s own decisions.” Bowling v. Pfizer,
Inc., 132 F.3d 1147, 1150 (6th Cir. 1998). Further, “[i]ssues such as
‘subject matter jurisdiction’ or ‘appellate jurisdiction’ may be ‘particularly
suitable for reconsideration.’ ” Kennedy v. Lubar, 273 F.3d 1293, 1299
(10th Cir. 2001) (quoting 18 Charles Alan Wright et al., Federal Practice &
Procedure § 4478, at 799 n.32 (1981)). This is not a case where the
appellate court has rendered a decision and remanded the case to the
district court. See Lee v. State, 874 N.W.2d 631, 646 (Iowa 2016).
IV. Conclusion.
Given the procedural circumstances of this case, Freer has not
preserved any issues for appellate review. We therefore affirm the district
6
court’s July 25, 2017 order entering judgment for DAC. DAC’s cross-
appeal is dismissed as moot.
AFFIRMED.
All justices concur except Mansfield, J., and Cady, C.J., and
Waterman, J., who dissent.
7
#17–1825, Freer v. DAC, Inc.
MANSFIELD, Justice (dissenting).
I respectfully dissent. The court’s decision violates the law of the
case, disregards the recent nunc pro tunc order, and leaves the plaintiffs
with an undeserved take-nothing judgment. I would reach the merits and
affirm the district court’s enforcement of the high-low settlement
agreement.
I. A Quick Recap of the Facts.
The basic facts are these. The case was submitted to the jury on
July 18, 2017. While the jury was out, on the morning of July 19, the
parties entered into a high-low agreement with $100,000 as the low and
$1 million as the high.
Later on the 19th, the jury returned a defense verdict. The district
court entered a take-nothing judgment on the jury verdict on July 25.
At this point, the posttrial wheels began to turn. On August 2, the
plaintiffs moved for a new trial and for change of venue. On August 10,
the defendant DAC, Inc. filed a resistance to the plaintiffs’ posttrial
motions and a motion to enforce the high-low settlement. On August 16,
the plaintiffs resisted DAC’s motion to enforce the settlement.
A hearing on these motions took place on October 13. The district
court stated that the high-low agreement controlled and that it was not
going to rule on the plaintiffs’ posttrial motions because it considered them
moot. The court also put on the record that when it had notified plaintiffs’
counsel of the defense verdict, counsel had responded, “Thank God we
entered into a high-low settlement agreement.”
No written order was entered following the October 13 hearing.
However, the plaintiffs filed a notice of appeal on November 7. The appeal
proceeded for the next year and three months.
8
On February 1, 2019, after we had heard oral argument on the
appeal, we entered the following order:
Upon consideration, the court concludes it lacks
jurisdiction to hear the appeal because no written ruling on
the parties’ posttrial motions was filed. See Iowa R. App. P.
6.101(1)(b). In accordance with rule 6.1004, this matter is
remanded to the district court for the limited purpose of the
entry of a written ruling, nunc pro tunc, on the parties’
posttrial motions.
On February 18 and 19, the district court entered a nunc pro tunc
written order granting DAC’s motion to enforce settlement and determining
that the plaintiffs’ posttrial motions were moot.
The parties’ (and my) expectation was that the court would now
reach the merits and determine whether the high-low agreement had
indeed mooted the posttrial motions. Instead, the court now treats
everything that has happened in this case since July 25, 2017, as a
nonevent. I disagree.
II. The Majority Disregards Both Law of the Case and the Nunc
Pro Tunc Order.
For one thing, the law of the case applies. Correct or not, we made
a ruling on February 1. In reliance on that ruling, the district court
entered a nunc pro tunc order. Upon return of the case to our court, the
February 1 ruling controls. See Lee v. State, 874 N.W.2d 631, 646 (Iowa
2016) (“It is a familiar legal principle that an appellate decision becomes
the law of the case and is controlling on both the trial court and on any
further appeals in the same case.”).
Furthermore, this is more than a typical law-of-the-case scenario.
The situation actually described in the majority opinion—i.e., a party filing
an appeal during the pendency of posttrial motions—no longer exists. The
district court has entered a nunc pro tunc order, thus fixing the very
9
absence of a written order the majority complains about. The entry of the
nunc pro tunc order moots the issue raised here by the majority. In
Wirtanen v. Provin, the trial court entered a nunc pro tunc order while the
appeal was pending before us in January 1980. See 293 N.W.2d 252, 255
(Iowa 1980). The nunc pro tunc order by its terms related back to
December 1978, prior to the filing of the notice of appeal. Id. We held that
for purposes of determining jurisdiction, we should regard the nunc pro
tunc order as having been entered before the notice of appeal. Id. at 256.
Additionally, the majority opinion leads to an impractical and
potentially unfair result. The plaintiffs should receive either $100,000 or
an opportunity to challenge the jury verdict in this case. Yet the court’s
decision leaves them with neither by affirming a take-nothing judgment.
Despite the majority’s decision, one hopes that DAC will honor its
view of the high-low settlement agreement and pay the plaintiffs $100,000.
But if DAC doesn’t, what happens next? The plaintiffs would have to file
a new lawsuit to enforce the settlement agreement and would now face
various obstacles in doing so. For example, does res judicata bar a brand
new lawsuit? Or suppose DAC decides to adopt the plaintiffs’ view of the
high-low settlement in the wake of the majority’s ruling.
Moreover, even if the majority were correct that the only appeal
before us is from the original take-nothing judgment, the majority would
still need to address the plaintiffs’ argument on pages 30–34 of their brief
that the district court abused its discretion in denying a mistrial.
Appellant’s Br. at 30–34. This argument is not based on the high-low
agreement or the posttrial motions. It is an argument that applies to the
original July 25, 2017 judgment entered on the jury verdict. So under the
majority’s logic, it has to be considered.
10
For all these reasons, I would reach the merits of whether the high-
low settlement agreement is binding.
III. The High-Low Agreement Is Enforceable Under These
Specific Circumstances.
Turning to whether this high-low agreement precludes posttrial
motions, there are several relevant precedents from other jurisdictions.
In Smith v. Settle, the Virginia Supreme Court held that a high-low
agreement foreclosed the plaintiffs from challenging jury instructions
posttrial. 492 S.E.2d 427, 429 (Va. 1997). It then determined that the
high-low agreement should be set aside because the plaintiffs had
repudiated it by refusing the tender of the “low” figure of $350,000. Id.
The court reasoned,
Finding nothing in counsel’s statement implying that a
“properly instructed” jury was part of the agreement or that
either party could seek post-verdict relief in the trial court, we
will not rewrite the agreement to impose provisions that are
neither stated nor implied therein. The plaintiffs’ unjustified
refusal of the tender prevented performance of the agreement
and gave Smith the right to regard it as terminated. Therefore,
we conclude that the court erred in enforcing the high-low
agreement.
Id. (citations omitted).
On the other hand, in Leibstein v. LaFarge North America, Inc., the
United States District Court for the Eastern District of New York said in
dicta that a high-low agreement entered into during jury deliberations
would not bar the plaintiffs from raising juror misconduct during voir dire.
767 F. Supp. 2d 373, 375–78 (E.D.N.Y. 2011). Notably, in that case the
basis for challenging the verdict did not come to light until after the jury
returned its verdict. See id. at 375.
In Matamoros v. Tovbin, the New York Appellate Division in a very
brief opinion said that the trial court properly considered the merits of
11
posttrial motions because “[t]he parties’ so-called ‘high-low’ agreement did
not expressly prohibit the making of the subject postverdict motion and
cross motion.” 919 N.Y.S.2d 95, 95–96 (App. Div. 2011).
Finally, in Reynolds v. Allied Emergency Services, PC, the parties had
entered into a high-low agreement prior to trial that expressly provided,
“No party will retain any appeal rights.” 193 So. 3d 625, 627 (Miss. 2016).
The Mississippi Supreme Court held that this agreement did not foreclose
the plaintiff from seeking a new trial—as opposed to an appeal—based on
erroneous jury instructions. Id. at 633.
The lesson I draw from this authority is that a high-low agreement
is just like any other contract, and it is therefore difficult to make blanket
generalizations. Sometimes the high-low agreement has precluded
posttrial motions; sometimes it hasn’t. The proper approach for a
reviewing court is to apply standard principles of contract interpretation
to the specific agreement at hand. See, e.g., Restatement (Second) of
Contracts §§ 202, 203, 204, 206, 207, at 86–107 (Am. Law Inst. 1981).
Here, several factors favor DAC’s position that the high-low precludes the
plaintiffs’ posttrial motions.
First, the agreement was entered into during jury deliberations. At
that time all the grounds for the subsequently filed posttrial motions were
already known. This is not a case where the agreement was entered into
first and then the grounds for the posttrial motions appeared later. In this
circumstance, it would have been reasonable for the plaintiffs’ counsel to
spell out an exception to the high-low that he already knew about.
Second, the agreement—such as it was—was drafted by the
plaintiffs’ counsel, not DAC’s counsel.
12
Third, as the district court noted, when told of the jury’s verdict, the
plaintiffs’ counsel said, “Thank God we entered into a high-low settlement
agreement.”
Accordingly, I agree with the district court’s interpretation of this
high-low agreement and would affirm the district court’s nunc pro tunc
order.
Cady, C.J., and Waterman, J., join this dissent.