Board of Directors, Bluebeard's Castle Hilltop Villas Condominium Ass'n v. Fairfield Resorts, Inc.

52 V.I. 611, 2009 U.S. Dist. LEXIS 64105
CourtDistrict Court, Virgin Islands
DecidedJuly 24, 2009
DocketD.C. Civil App. No. 2005-180
StatusPublished

This text of 52 V.I. 611 (Board of Directors, Bluebeard's Castle Hilltop Villas Condominium Ass'n v. Fairfield Resorts, Inc.) is published on Counsel Stack Legal Research, covering District Court, Virgin Islands primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Board of Directors, Bluebeard's Castle Hilltop Villas Condominium Ass'n v. Fairfield Resorts, Inc., 52 V.I. 611, 2009 U.S. Dist. LEXIS 64105 (vid 2009).

Opinion

MEMORANDUM OPINION

(July 24, 2009)

Three members of a housing condominium’s board of directors appeal an order, entered by the Superior Court of the Virgin Islands on June 6, 2005, prohibiting them from participating in litigation decisions in an action involving the housing condominium. For the reasons given below, the Court finds that it does not have jurisdiction to hear this appeal.

I. FACTUAL AND PROCEDURAL BACKGROUND

This appeal arises out of an action (the “Underlying Action”) commenced in November, 2004, by three of four condominium associations (the “Plaintiffs”) that together comprise a development known as Bluebeard’s Castle Resort on St. Thomas, U.S. Virgin Islands.1 The Defendants in the Underlying Action are several corporate entities and individuals involved in the development of the Plaintiffs’ condominiums.

Before the Underlying Action was commenced, Peter Hernandez, John Johnson and Scott Nassar (the “Appellants”) were elected to the board of directors of one of the Plaintiff associations, the Bluebeard’s Castle Villas III Condominium Association (“Villas III” or the “Appellee”). The Villas III board of directors had approved bringing the Underlying Action before the election of the Appellants.

Over the course of the Underlying Action, a dispute arose among the members of the Appellee’s board of directors with respect to the selection of legal counsel. On April 5, 2005, the Superior Court held a hearing on the matter. On June 6, 2005, the Superior Court issued an order (the

[615]*615“Order”) preventing the Appellants from participating in litigation decisions in the Underlying Action. The Appellants now appeal the Order. The Underlying Action is proceeding in the Superior Court notwithstanding this appeal.

II. DISCUSSION

This Court has jurisdiction to review final orders in civil cases. See Y.I. CODE Ann. tit. 4, § 33 (1997). The requirement of finality, also known as the final judgment rule, means that “ ‘a party must ordinarily raise all claims of error in a single appeal following final judgment on the merits.’ ” Richardson-Merrell, Inc. v. Roller, 472 U.S. 424, 429-30, 105 S. Ct. 2757, 86 L. Ed. 2d 340 (1985) (quoting Firestone Tire & Rubber Co. v. Risjord, 449 U.S. 368, 374, 101 S. Ct. 669, 66 L. Ed. 2d 571 (1981)). The Supreme Court has explained that “the final judgment rule serves several salutary purposes”:

It emphasizes the deference that appellate courts owe to the trial judge as the individual initially called upon to decide the many questions of law and fact that occur in the course of a trial. Permitting piecemeal appeals would undermine the independence of the district judge, as well as the special role that individual plays in our judicial system. In addition, the rule is in accordance with the sensible policy of avoiding the obstruction to just claims that would come from permitting the harassment and cost of a succession of separate appeals from the various rulings to which a litigation may give rise, from its initiation to entry of judgment. The rule also serves the important purpose of promoting efficient judicial administration.

Cunningham v. Hamilton County, 527 U.S. 198, 203-04, 119 S. Ct. 1915, 144 L. Ed. 2d 184 (1999) (quoting Firestone Tire & Rubber Co., 449 U.S. at 374). Consistent with these principles, the Supreme Court has held that a decision is not final unless it “ ‘ends the litigation on the merits and leaves nothing for the court to do but execute the judgment.’ ” Van Cauwenberghe v. Biard, 486 U.S. 517, 521-22, 108 S. Ct. 1945, 100 L. Ed. 2d 517 (1988) (quoting Catlin v. United States, 324 U.S. 229, 233, 65 S. Ct. 631, 89 L. Ed. 911 (1945)).

The Order in this matter does no more than prevent three individuals from participating in litigation decisions in the Underlying [616]*616Action. As such, it is not a final order on the merits that would ordinarily allow for direct appeal in this Court. See, e.g., Enrietto v. Townsend, 49 V.L 311, 316 (V.I. 2007). The U.S. Supreme Court has, however, set forth two exceptions to the final judgment rule that allow for otherwise unappealable orders to be immediately appealed. The first such exception concerns appeals from interlocutory orders relating to injunctive relief. The second such exception is referred to as the collateral order doctrine. Both of these exceptions are discussed below in turn.

The first exception to the final judgment rule vests the Court with appellate jurisdiction to review “[a]n interlocutory order granting, continuing, modifying, refusing or dissolving an injunction, or refusing to dissolve or modify an injunction.” V.I.R. APP. R 5(a)(2)(I). The Order in this matter provides, in pertinent part:

1. The undisputed facts in the record show [the Appellants] are directors on the Villas III Board of Directors and also employees of Defendants and/or their affiliates.
2. [The Appellants] are before this Court and within this Court’s jurisdiction because Villas III’s Board of Directors is a plaintiff in this case.
3. [The Appellants] have a conflict of interest with respect to this litigation.
4. [The Appellants] are prohibited from participating in any decision by the Villas III Board of Directors and the Villas III Association with respect to this litigation, including but not limited to the selection of Counsel and strategy in this litigation.

[Appellants’ App’x at 137.] While the parties appear to describe the Order as an injunction, the Court is “not constrained” by that characterization. See, e.g., Santana Products v. Compression Polymers, 8 F.3d 152, 154 (3d Cir. 1993) (quoting Bailey v. Systems Innovation, Inc., 852 F.2d 93, 96 (3d Cir. 1988)). Rather, the Court’s “crucial inquiry is as to the practical effect of the order.” See New Jersey State Nurses Ass’n v. Treacy, 834 F.2d 67, 69 (3d Cir. 1987) (reasoning that “certain orders not explicitly styled as injunctions may have injunctive effect”).

[617]*617The Court uses a three-part test to determine whether an interlocutory order is injunctive and, therefore, subject to immediate appeal. The order must be (1) “directed to a party”; (2) “enforceable by contempt”; and (3) “designed to accord or protect ‘some or all of the substantive relief sought by a complaint’ in more than a [temporary] fashion.” See Santana Products, 8 F.3d at 154 (citing Cohen v. Board of Trustees of University of Medicine & Dentistry, 867 F.2d 1455, 1465 n.9 (3d Cir. 1989)).

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Related

Catlin v. United States
324 U.S. 229 (Supreme Court, 1945)
Coopers & Lybrand v. Livesay
437 U.S. 463 (Supreme Court, 1978)
Firestone Tire & Rubber Co. v. Risjord
449 U.S. 368 (Supreme Court, 1981)
Richardson-Merrell Inc. v. Koller Ex Rel. Koller
472 U.S. 424 (Supreme Court, 1985)
Van Cauwenberghe v. Biard
486 U.S. 517 (Supreme Court, 1988)
Midland Asphalt Corp. v. United States
489 U.S. 794 (Supreme Court, 1989)
Cunningham v. Hamilton County
527 U.S. 198 (Supreme Court, 1999)
United States v. H. William Johns
858 F.2d 154 (Third Circuit, 1988)
Digital Equipment Corp. v. Desktop Direct, Inc.
511 U.S. 863 (Supreme Court, 1994)
Government of the Virgin Islands v. Hodge
359 F.3d 312 (Third Circuit, 2004)
Robinson v. Hartzell Propeller, Inc.
454 F.3d 163 (Third Circuit, 2006)
New Jersey State Nurses Ass'n v. Treacy
834 F.2d 67 (Third Circuit, 1987)
Bailey v. Systems Innovation, Inc.
852 F.2d 93 (Third Circuit, 1988)

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52 V.I. 611, 2009 U.S. Dist. LEXIS 64105, Counsel Stack Legal Research, https://law.counselstack.com/opinion/board-of-directors-bluebeards-castle-hilltop-villas-condominium-assn-v-vid-2009.