No Just Reason for Delay: The Colorado Court of Appeals Clarifies What it Takes to Get a Rule 54(b) Certification

A recent case from the Colorado Court of Appeals sends a message to district courts to “pump the brakes” on issuing Rule 54(b) certifications. A case announced last week provides some insight into when the appellate court might be taking a closer look at your Rule 54(b) certification. This post highlights the requirements for seeking a Rule 54(b) certification, gives an overview of the case, and summarizes three takeaways from the case.

Requirements for Certification under Rule 54(b)

If you’re in a case and you need a ruling on an order from the Court of Appeals without waiting for the end of the case, you may seek Rule 54(b) certification. This Rule allows a party to immediately appeal an otherwise non-final order. Because it is an exception to the general rule that the Court of Appeals hears only appeals from final judgments, you must meet several requirements. The district court must certify the judgment as final as to certain claims to allow such an appeal. There are three requirements for an iron-clad certification: “(1) the decision certified is a ruling on an entire claim for relief; (2) the decision is final in that it ultimately disposes of the individual claim; and (3) the district court determines expressly that there is no just reason for delay in entering a final judgment on the claim.”¹

While it doesn’t happen all that often, sometimes there can be a challenge to whether the district court’s certification was proper in the first place. When this issue arises, the Court of Appeals will look at the first two requirements as matters of law. The third requirement will be reviewed only for abuse of discretion. If the appeals court concludes the district court improperly certified a case for appeal under 54(b), the result is a dismissal of the appeal for lack of jurisdiction.

Allison v. Engel: Background on the Case

The factual and procedural background of the case is quite convoluted. The case involved a pair of neighbors fighting over a handful of issues related to their respective property rights. After a lot of back and forth in the district court, the parties found themselves at the Court of Appeals with a 54(b) certification. The district court had certified one claim in particular for appeal and found “no just reason for delay” in entering final judgment on that claim. As support for that finding, the district court apparently gave two reasons: (1) avoiding multiple trials; and (2) the fact that it would be nice to get guidance from the Court of Appeals on the merits of the underlying decision.

Allison v. Engel: The Court’s Opinion

The main question before the Court of Appeals was whether the Rule 54(b) certification was proper. The Court of Appeals emphasized that questions about its jurisdiction can be reviewed at any time. And whether the Court has jurisdiction depends on whether the district court got it right when it certified the judgment as final.

In deciding that it did not, the division concluded that the third requirement for certification—that there is no just reason for delay—was not met in this case. The division started out by noting that while 54(b) certifications have their place, they shouldn’t be routine. The purpose of such a certification is to avoid hardship that would result from waiting until the case was finally concluded in the district court before appeal. So “a party seeking certification (or a court certifying a ruling on its own motion) must show that a party will suffer some hardship or injustice that can be alleviated only by an immediate appeal.”²

Ultimately, the Court decided the district court abused its discretion by finding there was no just reason for delay. Taking the two reasons in the district court’s order in turn, the panel first noted that avoiding multiple trials is not a good enough reason to justify certification. If it was, “the same could be said about any case involving multiple claims or parties as to which a dispositive ruling is entered on one claim, or as to one party, before trial.”³ Neither is the fact that an appeal would probably provide clarity for later proceedings. Simply put, Rule 54(b) is not there to help district courts decide cases before them—it exists to prevent harm to a party from the delay the normal course of an appeal would cause.

Because the Court determined that the certification was improper, it dismissed the appeal for lack of jurisdiction.

Take-aways from the Case: Three Lessons for Practice

The Allison case is a good reminder about the importance of ensuring proper jurisdiction before the Court of Appeals, and provides several take-aways for litigants.

Be Prepared to Support your Request for Certification.

The Court of Appeals sent a strong message to district courts through this case: exercise Rule 54(b) certification power sparingly. This is not to say that Rule 54(b) certification will never be granted. There is a time and a place for the rule, and the Court’s opinion recognizes this. However, with the Court holding that a district court must give solid reasons for the certification in order for it to hold up before the Court of Appeals, district courts will likely be looking for stronger reasoning before issuing. Be prepared to meet this burden when requesting certification.

Understand What Constitutes a “Just Reason for Delay”

It may be tempting to reduce “no just reason for delay” to a meaningless recitation of the phrase tacked onto the end of a brief. Don’t make that mistake. When asking for Rule 54(b) certification, be sure to clearly spell out how not being able to appeal today will have a real impact on your client. The district court (and potentially the Court of Appeals) will be looking for a concrete hardship or injustice that can be avoided by an immediate appeal. Likewise, don’t put forth the grounds the court has clearly demonstrated as disfavored: avoiding multiple trials and getting guidance from the appellate court.

Nothing Gets Past These Judges…

If Rule 54(b) certification rests on shaky grounds, don’t be surprised if the Court of Appeals notices. First, if Rule 54(b) certification is in question, it is likely a motions division will consider the issue first. Even if the case gets through the motions division, the merits panel who decides the case can revisit that ruling and ultimately go the other way. Better to avoid this situation in the first place. Before expending the time and money it takes to bring an appeal through those levels of review, be sure the certification is solid.

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¹Allison v. Engel, 2017COA43, ¶ 24.

²Id. at ¶ 33.

³Id. at ¶ 40.