The Threshold Question of Interlocutory Orders–Can The Court of Appeals Even Address The Merits of The Appeal?

It happens quite frequently. The Court of Appeals will issue an opinion with substantial, detailed analysis that culminates in the following conclusion: the Court can’t address the issue that the appellant has asked it to address. The reason? The appeal is of an “interlocutory order,” and the general rule is that that “there is no right of immediate appeal from interlocutory orders and judgments.” Goldston v. American Motors Corp., 326 N.C. 723 725, 392 S.E. 2d 735, 736 (1990). “An interlocutory order is one made during the pendency of an action, which does not dispose of the case, but leaves it for further action by the trial court in order to settle and determine the entire controversy.” Veazey v. Durham, 231 N.C. 357, 362, 57 S.E. 2d 377, 381 (1950).

Based on this definition and the general rule that interlocutory orders are not immediately appealable, it would seem that the issue should be relatively cut and dry. Either an order is immediately appealable or it is not. However, the reason the Court of Appeals is consistently adjudicating this issue is the exception appearing in North Carolina Rule of Appellate Procedure 28(b)(4) that allows for appellate review of an interlocutory order upon sufficient facts and arguments showing that that challenged order “affects a substantial right.” And while the definition of an interlocutory order is straightforward, the determination as to whether an order that affects a substantial right is far more complex and “is determined on a case by case basis.” McConnell v. McConnell, 151 N.C. App. 622, 625, 566 S.E. 2d 801, 803 (2002).

Thus, oftentimes the Court of Appeals must spend a significant portion of its analysis of an appeal first determining if it can even reach the merits of the appeal due to the fact that the appeal is from an interlocutory order. Such was the case in two published opinions released by the Court today. In Clements v. Clements, the Court rejected the Appellee’s motion to dismiss the appeal on the grounds that the appeal was from an interlocutory order on subject matter jurisdiction that did not affect a substantial right. The Court instead held that the appellant in that case might be subjected to two trials covering the same factual issues and that there was the distinct possibility that the parties could be subject to inconsistent verdicts. Therefore, the Court held that the trial court’s order did affect a substantial right and the Court went on to analyze the issue on appeal as to whether or not the lower court had subject matter jurisdiction.

Conversely, in Heritage Operating, L.P. v. N.C. Propane Exchange, LLC, the Court of Appeals declined to reach the Appellant’s appeal of the trial court’s denial of its motion for summary judgment, ruling that the appeal did not affect a substantial right. The Court rejected the Appellant’s argument that the denial of its motion for summary judgment on res judicata grounds affected a substantial right and was therefore immediately appealable. Thus, the Court declined to address the merits of the appeal.  Of significance, however, the Heritage Court itself highlighted the complexity of the interlocutory appeal/substantial right issue, acknowledging in a footnote an apparent conflict within the Court’s own decisions as to whether the denial of a summary judgment motion based on res judicata affects a substantial right. (See footnote 2).

The issue of interlocutory appeals is one that is always going to be front and center at the Court of Appeals, and appellate practitioners should obviously therefore be hypersensitive to the issue, whether prosecuting or defending an appeal. Because no matter how high profile the issue sought to be appealed may be, the Court will not hear the merits of an interlocutory appeal if the appellant cannot demonstrate that the order affects a substantial right. This fact was front and center recently, when the Court reviewed an order denying a motion to dismiss in the case of Filipowski v. Oliver. The Defendant-Appellant in that case was seeking to strike down North Carolina’s alienation of affection and criminal conversation laws on constitutionality grounds. And although the case received significant attention in the media because of the controversial nature of these torts and the novel argument of Defendant, the Court never addressed the merits of the constitutionality of the torts. Instead the Court dismissed the appeal because it was from an interlocutory order and the Appellant failed to show how the order affected a substantial right.

One Response to “The Threshold Question of Interlocutory Orders–Can The Court of Appeals Even Address The Merits of The Appeal?”

  1. John Bowers says:

    Ironically, on Tuesday the court issued another opinion on res judicata and interlocutory appeals in Smith v. Bank of Stanly. In a very cursory opinion the Court reached the opposite conclusion from that in Heritage Operating v. NC Propane Exchange. In the opinion the Court quoted the Supreme Court’s decision in Bockweg v. Anderson in concluding that “the denial of a motion for summary judgment based on the defense of res judicata may affect a substantial right, making the order immediately appealable.”

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