In Metz v. McCarthy, No. 24-1820 (4th Cir. Feb. 25, 2026), the Fourth Circuit holds that a stipulation in the district court of dismissal without prejudice, which would deprive the court of appellate jurisdiction, can be repaired on appeal by the expedient of the plaintiff agreeing in briefing or argument that dismissal of all claims is with prejudice.
This is a tenant-landlord dispute involving a personal injury, removed to federal court by the defendant under diversity jurisdiction, 28 U.S.C. § 1332.
“[T]he district court granted McCarthy’s motion to dismiss the complaint as to the negligence claim and denied it as to the breach of contract claim. In order to create a final judgment and appeal it, Metz, with the agreement of McCarthy, stipulated to ‘the voluntary dismissal’ of the breach of contract claim, and Metz then filed a notice of appeal from the district court’s order dismissing the negligence claim.”
Alas, the stipulation did not specify whether dismissal was with or without prejudice: “Pursuant to Federal Rule of Civil Procedure 41(a)(1)(A)(ii), all parties stipulate to the voluntary dismissal of Plaintiff Cheryl Metz’s remaining Count I of the Complaint (Breach of Contract), in this matter against Defendant Laurie McCarthy.”
The Fourth Circuit notes: “Because the voluntary dismissal of the breach of contract claim in Count I did not indicate whether it was with or without prejudice and therefore had to be taken to be without prejudice, see Fed. R. Civ. P. 41(a)(1)(B) . . . , we requested that the parties file supplemental briefs on whether we had jurisdiction on appeal” considering a possible lack of a final judgment. In plaintiff-appellant’s supplemental brief, she stated “that she has abandoned the breach of contract claim, with no intent in resurrecting it, for purposes of litigating only her negligence claim.”
This admission was sufficient to remedy the defect in the stipulated dismissal and confer appellate jurisdiction under 28 U.S.C. § 1291.
“We agree that Metz’s representation is binding and that, with that representation, her voluntary dismissal of her breach of contract claim in Count I became effectively a dismissal with prejudice, so as to create a final judgment as to the order dismissing her negligence claim. In reaching this conclusion, we join the numerous courts that have reached a similar conclusion” (citing cases from the Second, Third, Sixth and Seventh Circuits).
“Our conclusion, moreover, was sealed during oral argument with the following exchange: Judge Niemeyer: ‘Can we agree that there’s a stipulation that your dismissal was with prejudice?’ Mr. Krone (on behalf of Metz): ‘Yes.’”
Judgment was then affirmed on the merits.
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