Seriously. New Supreme Court Ruling Says Summary Judgment Orders MUST Comply with Rule 56.04. Part 1 of 2
Note: This blog post is an excerpt from an article published in the October 2014 issue of the Tennessee Bar Journal and is reproduced here with the TBJ’s permission.
The Tennessee Supreme Court recently issued an opinion holding that — as required by Tennessee Rule of Civil Procedure 56.04 — an order granting or denying a motion for summary judgment must contain a statement of the legal grounds on which the decision is based and that the statement contained in the order must be the product of the trial court’s own, independent analysis and judgment. The case, Mary C. Smith v. UHS of Lakeside Inc., No. W2011-02405-SC-R11-CV, 2014 Tenn. LEXIS 565 (Tenn. July 15, 2014), also provides some significant standards for compliance with this Rule 56.04 “statement-of-legal-grounds” requirement.
This blog post, which is part 1 of 2, explains those standards. The second blog post will provide analysis of the Smith case and discuss its potential ramifications.
Smith does not ban the submission of proposed summary judgment orders drafted by the parties. However, in sum and substance, Smith makes clear that the practice of judicial reliance on findings of fact, conclusions of law, or orders prepared by one of the parties can satisfy Rule 56.04 only as long as the party-prepared findings, conclusions and orders accurately reflect the decision of the trial court and the record leaves no doubt that the decision represents the trial court’s own independent deliberations and judgment.
The Supreme Court’s analysis in Smith allows the following practical lessons to be drawn:
1. DIY Is Still the Preferred Method for Preparing Summary Judgment Orders.
To begin with, the Supreme Court expressly “continues to adhere to the view that findings of fact, conclusions of law, opinions, and orders prepared by trial judges themselves are preferable to those prepared by counsel.” The first choice for the trial court, then, is “do-it-yourself.”
Accordingly, the surest way to be in compliance with Rule 56.04 is for the trial court to prepare its own summary judgment order and to include an analysis as to both findings required by Rule 56: (1) whether there is a genuine issue as to any material fact, and (2) whether and why the movant is or is not entitled to a judgment as a matter of law.
2. Proposed Orders Prepared by Counsel Are Permissible – with Caveats.
Nevertheless, the Tennessee Supreme Court expressly does not find any inherent inconsistency between the Rule 56.04 requirement that the trial court state the grounds for its decision and the trial courts’ custom of requesting and considering proposed orders prepared by the prevailing party. Smith recognizes that it is permissible — indeed sometimes even desirable — for the trial court to seek proposed findings of fact and conclusions of law from the parties or from one of the parties. At the same time, Smith cautions that this must be done in a way that guarantees that the trial court’s decision to grant or deny a summary judgment motion is its own, considered decision.
To light the way, Smith sets out some standards to go by when the trial court does ask for proposed orders. These standards, which are intended help make sure that a summary judgment decision is the product of the trial court’s own independent analysis with respect to the facts and with respect to the application of relevant legal principles to the facts, are as follows:
a. State the Grounds Before Asking Counsel to Draft the Order.
The trial court must “upon granting or denying a motion for summary judgment … state the grounds for its decision BEFORE it invites or requests the prevailing party to draft a proposed order.” This “before” standard is designed to promote and evidence independent, logical decision-making by the trial court. Implementing this standard will not only inform the appellate court of the basis for the decision, thereby permitting meaningful review, but will also make clear on the record that the statement of legal grounds in the order is directly attributable to the independent work of the trial court.
The trial court may comply with this “before” requirement in one of several ways:
i. State the Grounds on the Record When Announcing the Decision.
The trial court may state the grounds for its decision at the same time it announces its decision on the record.
ii. State the Grounds in a Memorandum Opinion.
Or, the trial court may announce its decision and let the parties know that it will provide the grounds for that decision in a subsequently filed memorandum or memorandum opinion.
iii. State the Grounds in a Letter to the Parties.
Or, the trial court may announce its decision and then notify the parties of the grounds for its decision in a letter, which must, of course, be sent to all parties and must be made part of the record.
b. Independently Review and Consider Proposed Party-Prepared Orders
If, after articulating its reasons for granting or denying summary judgment, the trial court does ask one of the parties to submit a proposed order, the trial court must still independently review and consider the proposed order to make sure that it accurately reflects not only the trial court’s ruling but also its legal analysis. When the record clearly shows that the trial court independently considered the proposed order before signing it, there is a much greater likelihood that an appellate court will accept the order as being in compliance with Rule 56.04. Thus, the record should reflect that the trial court independently considered the proposed submissions. This will transpire as a matter of course if the trial court takes the time and trouble to rework a proposed order and ultimately adopts an order that varies in some meaningful way from the party-proposed order.
On the other hand, wholesale judicial adoption of a party-proposed order can raise concerns about whether the order truly reflects the trial court’s legal reasoning. As Smith points out, the practice of adopting verbatim, without critical review and independent analysis, the findings of fact, conclusions of law, opinions, or orders prepared by counsel for the prevailing party should be avoided because it leaves the impression that the trial judge has not made a deliberate, analytically supported, independent decision, but rather has ceded its core judicial decision-making responsibility to one of the parties. The practice may create the appearance of bias, and it may (understandably) tempt the zealous advocate-drafter to overreach or exaggerate.
3. Wiggle Room
A summary judgment order that fails to comply with Rule 56.04 and the Smith standards is not necessarily or automatically doomed. Smith allows some wiggle room in “proper circumstances,” namely when the absence of stated grounds in the trial court’s order does not “significantly hamper” appellate review.
Under those specific circumstances, the Supreme Court explains, judicial economy considerations may override the absence of the required statement and the appeal may be allowed to go forward. However, when evaluating issues related to a trial court’s lack of compliance with Rule 56.04, appellate courts are advised to factor in the fundamental importance of assuring that the trial court’s summary judgment ruling is adequately explained and is the product of the trial court’s own independent judgment.