USIC Locating Services LLC v. Project Resources Group Inc.
2023 COA 33. No. 22CA0138. CRCP 12(b)(6)—CRCP 19—Joinder of Parties—CRCP 41(a)(1)(A)—Voluntary Dismissal—Attorney Fees.
April 6, 2023
USIC Locating Services LLC (USIC) assists utilities with locating and marking underground utility lines and covers repair costs for lines that are damaged in an excavation. Project Resources Group Inc. (PRG) is a third-party administrator that assists utilities with processing and submitting invoices to USIC for payment and also functions as a debt collector by pursuing payments owed by USIC. USIC filed this action in state court for fraudulent misrepresentation, negligent misrepresentation, conversion, unjust enrichment, civil theft, and violation of the Colorado Consumer Protection Act, alleging that PRG was inflating charges to deceive USIC into paying higher amounts. PRG removed the action to federal court based on diversity jurisdiction but USIC objected, and the action was remanded to state court. On remand, PRG moved to dismiss the complaint under CRCP 12(b)(5) and (6) for failure to state a claim and failure to join the utilities, but it did not file an answer. The trial court granted the motion in part and gave USIC leave to amend the complaint to join the utilities. USIC amended its complaint, dropping its unjust enrichment claim and amending its other claims, but it didn’t join the utilities. PRG moved to dismiss the amended complaint. The court granted the motion and dismissed the amended complaint without prejudice under CRCP 12(b)(6). USIC then moved for leave to amend its complaint again and for a determination under CRCP 19 that the utilities couldn’t feasibly be joined and weren’t indispensable. PRG moved for attorney fees and costs. The court ordered discovery concerning the joinder issue, after which USIC could renew or withdraw its motion, and it denied PRG’s request for fees and costs. About three weeks later, USIC filed a notice of voluntary dismissal without prejudice under CRCP 41(a)(1)(A) and initiated a new action in federal court, which is stayed pending resolution of this appeal. PRG filed a renewed motion for attorney fees and costs, which the court granted. The court also ordered that USIC’s conditional dismissal without prejudice was made absolute, and it dismissed the action with prejudice.
On appeal, USIC contended that the trial court erred by converting its voluntary dismissal without prejudice into a dismissal with prejudice. Under CRCP 41(a)(1)(A), a plaintiff may dismiss an action without court order by filing a notice of dismissal before the adverse party files or serves an answer or moves for summary judgment, whichever occurs first. Such voluntary dismissal is without prejudice unless the notice of dismissal states otherwise, and the right to a voluntary dismissal without prejudice under CRCP 41(a)(1) is absolute. However, a notice of dismissal operates as an adjudication on the merits when filed by a plaintiff who has previously dismissed an action in any court that is based on or includes the same claim. Here, it is undisputed that PRG hadn’t yet filed or served an answer or motion for summary judgment and that USIC hadn’t previously dismissed an action based on the same claims, so when USIC filed its notice of voluntary dismissal, the action hadn’t been fully resolved. Thus, USIC’s voluntary dismissal without prejudice under CRCP 41(a)(1)(A) was proper, and it automatically ended the action without the need for court order or approval. Therefore, the voluntary dismissal divested the trial court of jurisdiction to enter the order dismissing the action with prejudice.
USIC also contended that the trial court erred by granting PRG’s request for attorney fees. However, the trial court did not determine the amount of fees, so its order is not a final, appealable order. Accordingly, the court of appeals lacked jurisdiction over this portion of the appeal.
Lastly, the court rejected PRG’s request for appellate attorney fees because PRG did not successfully defend the dismissal order.
The judgment was vacated and the case was remanded with instructions to dismiss the action without prejudice. The portion of the appeal challenging the trial court’s attorney fees order was dismissed.