Default Order Not Final And Appealable

In this multi-count business dispute, Fidelity National Title Insurance sued a number of parties. The trial court granted summary judgment to defendants on all but one count of the complaint. A breach of contract claim still remained against Old Intercounty.

About three weeks later, the trial court ruled that Old Intercounty was in default on that contract claim. But the court did not enter a default judgment at that time. Nor did the court issue language under Illinois Supreme Court Rule 304(a) that would have permitted an appeal before a final judgment as to all issues against all parties. At Fidelity’s request, the trial court issued Rule 304(a) language as to the summary judgments a week and a half later.

Fidelity National appealed the summary judgments within 30 days of the time the trial court issued Rule 304(a) language. But Fidelity’s Notice of Appeal was filed more than 30 days after the trial court granted the summary judgments.

The defendants asked the appellate court to dismiss Fidelity’s appeal. They argued that the appellate court did not have jurisdiction to decide the case because Fidelity did not appeal within 30 days of the summary judgments.

The First District Illinois Appellate Court disagreed. The appellate court ruled that Fidelity’s 30-day window began when the trial court issued its 304(a) language, not when the summary judgments were entered. Here’s what the court said:

In this case, the circuit court’s order granting summary judgment in favor of defendants did not dispose of the entire controversy between the parties because it left outstanding the breach of contract claim against Old Intercounty. Although the court subsequently declared Old Intercounty in default, it did not enter a default judgment. An order of default is not a final judgment or an interlocutory order appealable as of right because it does not dispose of the case and determine the rights of the parties … Rather, an order of default is simply an interlocutory order that precludes the defaulting party from making any additional defenses to liability but in itself determines no rights or remedies … It is the entry of a default judgment, which the court did not enter in this case, that terminates the litigation and decides the dispute.

Therefore, in this case, without the entry of a judgment against Old Intercounty disposing of count IX of the complaint, all previous orders, including the order granting summary judgment, were interlocutory and could not be appealed without a finding by the court, pursuant to Rule 304(a), that there was no just reason to delay appeal. 210 Ill.2d R. 304(a). … Fidelity’s notice of appeal was filed on July 5, 2006, within 30 days of the court’s Rule 304(a) finding, and was therefore timely and properly invoked the jurisdiction of this court. According, we have jurisdiction to consider Fidelity’s appeal.

Read the whole opinion, Fidelity National Title Ins. Co. v. Westhaven Properties Partnership, No. 1-06-1895 (10/26/07) (only recently posted), by clicking here.