The Two-Dismissal Rule

By: Matthew D. Quinn

Greetings, and thanks for visiting Lewis & Roberts, PLLC’s blog!  Our firm is fortunate to be filled with several energetic lawyers with an interest in writing blog posts which might help North Carolina attorneys or the general public understand various aspects of the law.  My law practice focuses on general civil litigation, including personal injury, wrongful death, commercial torts, and business litigation.  Other attorneys at Lewis & Roberts concentrate on workers’ compensation defense.  We therefore expect that this blog post will focus on civil litigation and workers’ compensation issues.  That said, in keeping with the informal tone of a blog, we also hope to publish an occasional lighthearted post illustrating that even lawyers can have a fun side.  Naturally, these blog posts are no substitute for hiring a lawyer to provide tailored research and advice to represent your personal interests. 

As this inaugural blog post, I would like to focus on a civil litigation issue which, unfortunately, arises from time to time in civil litigation.  Namely, I will address some issues arising when a civil action is voluntarily dismissed without prejudice under Rule 41 of the N.C. Rules of Civil Procedure.

Imagine for a moment that you are representing a plaintiff during a jury trial.  Imagine further that you are saving your star witness to testify last—perhaps you expect that your star witness will make a huge impression with the jury and will practically ensure a favorable result.  After your second-to-last witness leaves the courtroom, you turn your head to the gallery and realize, with shock, that the star witness is… missing. 

Perhaps the star witness was not served with a trial subpoena.  Perhaps the star witness mis-calendared the court date and is out-of-country.  Whatever the reason, you ask the Court for a continuance but the Court denies your request.  Are you required to finish the trial without the testimony of the star witness?  What is a trial attorney to do?

Although not ideal, the N.C. Rules of Civil Procedure provide a procedural mechanism which can save the plaintiff: in general, a plaintiff can voluntarily dismiss a civil action and re-file the action once a problem, such as the failure of a star witness to attend trial, has been addressed.

Under Rule 41 of the N.C. Rules of Civil Procedure, a plaintiff can voluntarily dismiss a civil action at any time before the plaintiff “rests his case.”   In that event, typically the plaintiff can re-file its lawsuit once any problems have been corrected.  A popular legal hornbook aptly characterizes this procedural mechanism as follows: “Rule 41 has been the salvation and downfall of many a trial lawyer.”  G. Gray Wilson, N.C. Civil Procedure, Sec. 41-2 (4th ed).

I want to emphasize the word “downfall.”  There are many dangers lurking behind a voluntary dismissal under Rule 41, and the practitioner should always review Rule 41 before filing a voluntary dismissal.  By way of example, whether the plaintiff has actually “rest[ed] his case” is more complicated than it appears at first blush.  Moreover, the impact of a dismissal upon the statute of limitations can be complex.  Many of these various complexities will be the subject of subsequent blog posts.

For present purposes, I want to focus on what is commonly known as the two-dismissal rule.  Under Rule 41(a)(1), “Unless otherwise stated in the notice of dismissal or stipulation, the dismissal is without prejudice, except that a notice of dismissal operates as an adjudication upon the merits when filed by a plaintiff who has once dismissed in any court of this or any other state or of the United States, an action based on or including the same claim.”  In other words, a plaintiff can avail herself of one voluntary dismissal without prejudice.  A second dismissal, on the other hand, will automatically be with prejudice and therefore bar subsequent civil actions based upon the same claim.

Surprisingly, it can sometimes be challenging to count the number of dismissals previously filed.  For instance, suppose you have filed a civil action against two defendants, and for whatever reason, you file separate dismissals at different times as to each individual defendant.  If you subsequently re-file your civil action against both of the original defendants, does the two-dismissal rule bar the civil action?  In other words, do the two separate dismissals of the individual defendants in the original action count as the plaintiff’s two dismissals under Rule 41?

This question has been addressed by the N.C. Court of Appeals.  In Hopkins v. Ciba-Geigy Corp., 111 N.C. App. 179, 432 S.E.2d 142 (1993), the plaintiff sued defendant 1 and defendant 2, and then filed two dismissals: one against each respective defendant.  The plaintiff then re-filed against defendant 1 and defendant 2, and defendant 1 argued that the two-dismissal rule applied and therefore barred the second action.  The Court of Appeals rejected that argument and held that the two-dismissal rule requires the dismissal of two actions.  Hence, the plaintiff did not violate the two-dismissal rule in Hopkins.

But, as always with Rule 41, there are several nuances to consider.  For instance, the two-dismissal rule does not require a strict identity of defendants.  For example, you probably cannot file and dismiss action 1 against defendant 1, then file and dismiss action 2 against defendant 2, and then file action 3 against defendant 1.  If each action pertained to the same facts, then the dismissal of action 2 likely serves as an adjudication of the merits and therefore prohibits action 3.  A similar situation was discussed in City of Raleigh v. College Campus Apartments Inc., 94 N.C. App. 28, 380 S.E.2d 163 (1989).

Ultimately, Rule 41 can be helpful or a nightmare.  Whenever the practitioner contemplates a voluntary dismissal without prejudice, it is important to thoroughly research the contemplated course of action.  Significantly, the above content does not nearly address all issues with the two-dismissal rule, but, hopefully, serves as a starting place for research or further discussion.

If you have any civil litigation issues or questions, I would love to hear from you.  I can be reached at mdq@lewis-roberts.com or 919-981-0191.