Rule 54(b) Certification Inappropriate Where Claims Are Intertwined

In North Alabama Electric Cooperative v. New Hope Telephone Cooperative, the Alabama Supreme Court dismissed a Rule 54(b) interlocutory appeal because the claim for common law indemnity that was adjudicated by the trial court was intertwined with the claim for contractual indemnity that was still pending before the trial court. 

The defendants in this case appealed from a partial summary judgment entered in favor of a third party defendant on a common law indemnity claim.  This claim had been asserted as a cross claim along with a claim for contractual indemnity, which remained pending in the trial court. 

Noting that some claims are so intertwined that a Rule 54(b) certification is untenable, the court cited certain rules of thumb for determining when this is so.  One such rule is that claims cannot be separate unless separate recovery is possible on each of them.  Further, the court noted that claims that are mutually exclusive or that reflect alternative claims for the recovery of damages should not be split for appellate review by way of Rule 54(b). 

The cross claim for contractual indemnity and common law indemnity fell squarely within this category of intertwined claims, the court concluded.  Although differed theories of indemnification recovery were pled, i.e., contract and common law, there could be only one recovery for indemnification.  Consequently, the adjudication of the common law indemnity crossclaim was not appropriate under Rule 54(b) and the appeal was dismissed.