Stewart v. Midwestern Indemnity Co. ( 1989 )

Moyer, C.J.

The question presented by this appeal is whether a trial court order vacating an arbitration award and decision which also orders the parties to select new arbitrators and to have a new arbitration is a final appealable order within the meaning of R.C. 2505.02. We hold that it is not.

Section 3(B)(2), Article IV of the Ohio Constitution provides that “[c]ourts of appeals shall have such jurisdiction as may be provided by law to review and affirm, modify, or reverse judgments or final orders of the courts of record inferior to the court of appeals within the district * ** Thus, the jurisdiction of the courts of appeals to review judgments and orders of courts of record is set by statute.

In this respect, R.C. 2505.02 provides in part:

“An order that affects a substantial right in an action which in effect determines the action and prevents a judgment, an order that affects a substantial right made in a special proceeding or upon a summary application in an action after judgment, or an order that vacates or "sets aside a judgment or grants a new trial is a final order that may be reviewed, affirmed, modified, or reversed, with or without retrial.”

R.C. 2711.15 provides: “An appeal may be taken from an order confirming, modifying, correcting, or vacating an award made in an arbitration proceeding or from judgment entered upon an award.”

Consequently, reading R.C. 2505. 02 and 2711.15 in pari materia, it is crucial that an order made pursuant to R.C. 2711.15 must satisfy the requirements of R.C. 2505.02 in order to be a final appealable order if the court of appeals is to have jurisdiction to hear an appeal from such an order.

In Bellaire City Schools Bd. of Edn. v. Paxton (1979), 59 Ohio St. 2d 65, 69-70, 13 O.O. 3d 58, 60-61, 391 N.E. 2d 1021, 1024, we enumerated the requirements to establish an ap-pealable order pursuant to R.C. 2505.02: “ ‘If * * * [the trial court’s order] lacks one of the three qualifications of (a) affecting a substantial right, (b) determining the action, or (c) preventing a judgment, it cannot be a final order, for all three attributes must concur to make it such,’ ” citing to Pewter Mug, Inc. v. M.U.G. Enterprises, Inc. (1975), 46 Ohio App. 2d 93, 94, 75 O.O. 2d 78, 78-79, 345 N.E. 2d 426, 427. In this instance, we are concerned with whether this appeal is from an order which determines the action or prevents a judgment. See, also, General Electric Supply Co. v. Warden Electric, Inc. (1988), 38 Ohio St. 3d 378, 528 N.E. 2d 195.

The parties submitted conflicting affidavits from members of the board indicating a dispute whether all the claims for damages had been resolved. The trial court apparently believed that the decision reached by the arbitration panel was incomplete on the issues presented by the parties. See R.C. 2711.10.¹ Because the trial court order did not vacate only the arbitration award and decision but also provided for a new arbitration proceeding, the order cannot be considered a “determin[ation of] the action” or one which “prevents a judgment” within the meaning of R.C. 2505.02. No final judgment has been entered by the trial court on the merits of the arbitration award and decision.

Thus, we conclude that a trial court order which vacates an arbitration award and orders the parties to select new arbitrators and to conduct a new arbitration proceeding is not a “final appealable order” as defined in R.C. 2505.02.

A secondary issue concerning the applicability of Civ. R. 54(B) has been raised by the parties. Even though it is not a dispositive issue here, in view of our application of R.C. 2505.02, we will discuss it briefly.

We have recently held that an order is final and appealable only if the requirements of R.C. 2505.02 are satisfied and, if applicable, the requirements of Civ. R. 54(B)² are satisfied. See Noble v. Colwell (1989), 44 Ohio St. 3d 92, 540 N.E. 2d 1381; General Acc. Ins. Co. v. Insurance Co. of North America (1989), 44 Ohio St. 3d 17, 540 N.E. 2d 266. Civ. R. 54(B) was adopted to permit appeal when judgment is rendered on fewer than all of the claims or parties present before the court. “However, when a court enters final judgment as to fewer than all of the claims or parties, it must expressly state that there is no just reason to delay an appeal on that judgment. Without such express determination, an order adjudicating fewer than all the claims or parties * * shall not terminate the action as to any of the claims or parties ***.’” General Acc. Ins. Co., supra, at 20, 540 N.E. 2d at 270. As a procedural device, Civ. R. 54(B) cannot affect the finality of an order, see Alexander v. Buckeye Pipe Line Co. (1977), 49 Ohio St. 2d 158,159, 3 O.O. 3d 174,175, 359 N.E. 2d 702, 703, and therefore “does not alter the requirement that the order must be final before it is ap-pealable. * * *” Douthitt v. Garrison (1981), 3 Ohio App. 3d 254, 255, 3 OBR 286, 287, 444 N.E 2d 1068, 1069-1070.

Even assuming that plaintiffs request for compensation under the bad faith claim and her claim for compensation pursuant to the insurance policy, which was the subject of arbitration, were two separate claims in a single cause of action, the absence of a statement by the trial court, in the entry vacating the arbitration award, that there is no just reason to delay an appeal, causes us to conclude that the trial court was aware that its order was not a final appealable order pursuant to R.C. 2505.02 and that Civ. R. 54(B) is therefore not applicable.

For the foregoing reasons, the judgment of the court of appeals is affirmed.

Judgment affirmed.

Sweeney, Holmes, H. Brown and Re snick, JJ., concur. Douglas and Wright, JJ., dissent separately.

1 R.C. 2711.10 provides in relevant part:

“In any of the following cases, the court of common pleas shall make an order vacating the award upon the application of any party to the arbitration if:

* *

“(D) The arbitrators exceeded their powers, or so imperfectly executed them that a mutual, final, and definite award upon the subject matter submitted was not made.

“If an award is vacated and the time within which the agreement required the award to be made has not expired, the court may direct a rehearing by the arbitrators.” (Emphasis added.)

2 Civ. R. 54(B) provides in pertinent part:

“When more than one claim for relief is presented in an action * * *, the court may enter 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. In the absence of such determination, any order * * * which adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties shall not terminate the action as to any of the claims or parties, and the order * * * is subject to revision at any time before the entry of judgment adjudicating all the claims and the rights and liabilities of all the parties.”