HOWELL v. VITO‘S TRUCKING AND EXCAVATING COMPANY
No. 52,679
OCTOBER TERM, 1971.
Decided November 9, 1971.
386 Mich 37
Submitted March 3, 1971.
OPINION OF THE COURT
1. JUDGMENT - ACTION - MERGER - BARRING ACTION - ISSUES - DEFAULT JUDGMENT.
A judgment in favor of the plaintiff merges the cause of action in the judgment and the plaintiff cannot thereafter maintain an action on the original cause of action; if a judgment is in favor of the defendant on the merits, the original cause of action is barred by the judgment; and in either case the original cause of action is extinguished by the judgment no matter what issues were raised and litigated in the action, or even if no issues were raised or litigated and judgment was by default.
2. JUDGMENT - COLLATERAL ESTOPPEL - ACTION - QUESTIONS LITIGATED.
The doctrine of collateral estoppel is that a judgment is conclusive between the parties to a subsequent action based upon
REFERENCES FOR POINTS IN HEADNOTES
[1]
Doctrine of res judicata as applied to default judgments. 128 ALR 472, supp. 77 ALR2d 1410.
[2]
[3]
[4]
Judgment for or against person in fiduciary capacity as res judicata for or against him in his individual or a different capacity, or vice versa. 170 ALR 1180.
[5]
Judgment in action growing out of accident as res judicata, as to negligence or contributory negligence, in later action growing out of same accident by or against one not a party to earlier action. 133 ALR 181, supp. 23 ALR2d 710.
[6, 8]
Mutuality of estoppel as prerequisite of availability of doctrine of collateral estoppel to a stranger to the judgment. 31 ALR3d 1044.
[7]
[9]
3. AUTOMOBILES - ACTION - PARTIES - PRIVIES - SEPARATE ACTIONS - WRONGFUL DEATH.
Husband, suing as administrator of his wife‘s estate, as an individual, and as guardian of his minor son, was not a party or privy to a separate action by his daughter for damages for her injuries arising out of the same motor vehicle collision which caused his wife‘s death, the parties were separate legal entities and remain as legal strangers even though the husband and those he represented were interested in the outcome of the daughter‘s action, or were witnesses, or participated in a limited representative capacity for the benefit of one of the parties as he did not have the right to make defense, control the proceedings or appeal from a judgment which would have been adverse to the daughter‘s claim and this equally applies where the daughter appears in the case by the husband solely as an heir at law of her mother and bases her claim exclusively upon rights derived from the latter‘s wrongful death.
4. JUDGMENT - RES JUDICATA - ACTION - PARTIES.
A judgment for or against a person who brings an action or is sued in his individual right is not operative under the doctrine of res judicata in a subsequent action brought by or against the same person in a representative capacity; a judgment in an action in which one of the parties appears in a representative capacity is not operative under the doctrine of res judicata in a subsequent action involving the same party in his individual right; but these rules are not applicable where a party to one action in his individual capacity and to another action in his representative capacity is in each case asserting or protecting his individual rights.
5. AUTOMOBILES - JUDGMENT - RES JUDICATA - NEGLIGENCE - CONTRIBUTORY NEGLIGENCE - PARTIES.
Judgment for the plaintiff for damages for personal injuries arising from an automobile accident is not res judicata, or conclusive, as to issues of negligence or contributory negligence, in a subsequent action growing out of the same accident, by a different plaintiff against the same defendant.
Assertion of res judicata would fail for want of mutuality and neither the plaintiff nor defendant are bound in a suit by a husband as administrator of his wife‘s estate as an individual and as guardian of his minor son to recover damages arising out of a motor vehicle collision which caused his wife‘s death, as it pertains to defendant‘s negligence or his wife‘s lack of contributory negligence, by the judgment in his daughter‘s separate successfully presented case for damages for her injuries arising out of the same collision as both the litigants must be alike concluded by the judgment or it binds neither.
7. ESTOPPEL - DISCRETION.
The application of estoppel should not be left to the discretion of the trial judge as the course of justice is best served by adherence to a long established and definitive rule which the bench and bar of Michigan well recognizes rather than permit an ad hoc formulation of a rule based on innumerable and unmanageable factors.
8. JUDGMENT - COLLATERAL ESTOPPEL - AUTOMOBILES - ACTION - PARTIES - SEPARATE ACTIONS - MUTUALITY.
Defendant is not collaterally estopped from defending against plaintiff‘s claim of negligence in an action by a husband as administrator of his wife‘s estate, as an individual, and as guardian of his minor son for damages arising out of a motor vehicle accident by a judgment against defendant in a separate suit by plaintiff‘s daughter for damages for her injuries arising out of the same collision which caused the wife‘s death because mutuality is required to apply collateral estoppel.
9. JUDGMENT - ESTOPPEL.
An estoppel by previous judgment cannot prevail where the specific claim in question was actually excluded from judicial consideration in the first action.
Appeal from Court of Appeals, Division 2, T. G. Kavanagh, Quinn and Miller, JJ., remanding Oakland, Arthur E. Moore, J. Submitted March 3, 1971. (No. 40 January Term 1971, Docket No. 52,679.) Decided November 9, 1971.
Complaint by William Howell, administrator of the estate of Hattie Howell, deceased, for himself and as guardian of James L. Howell, a minor, against Vito‘s Trucking and Excavating Company for damages for wrongful death and personal injuries resulting from a motor vehicle collision. Partial summary judgment for plaintiff. Plaintiff appealed and defendant cross-appealed to the Court of Appeals. Remanded. Plaintiff and defendant appeal. Reversed and remanded.
Richard L. Wolk, for plaintiff.
Patterson & Patterson, Whitfield, Manikoff & White (by Robert G. Waddell), for defendant.
T. M. KAVANAGH, C. J. We are asked to reconsider and clarify the doctrine of collateral estoppel by judgment, especially concerning the traditional requirement of mutuality.
Plaintiff‘s decedent, Hattie Howell, died of injuries received in a motor vehicle collision with defendant‘s truck. Other occupants of the Howell car, including a daughter Anna Sue Collins, were injured. Plaintiff brought the present wrongful death action in Oakland Circuit Court. Defendant‘s answer denied negligence and asserted “sudden emergency” as an affirmative defense. Before the wrongful death suit reached trial, Anna Sue, a Tennessee resident, obtained a judgment in the Michigan Federal District Court, Eastern District, against defendant for the injuries she received in the accident. Thereafter plaintiff moved for partial summary judgment in the Oakland Circuit Court alleging that the prior adjudication in favor of Anna Sue in the
The trial court (Moore, J.) granted the motion insofar as it related to Anna Sue, but denied it as to the remaining interested parties. The Court of Appeals (T. G. KAVANAGH, J. and Miller, J.; QUINN, J., dissenting) remanded the case to the trial court for reconsideration of the motion, holding: (1) The motion should have been granted, if at all, as to all interested parties (plaintiffs); (2) The trial court had discretion to apply collateral estoppel against defendant, mutuality not being a controlling factor. Both parties appealed and we granted leave.
Issues:
(1) (As stated by defendant): Is a judgment in favor of one passenger for injuries arising out of an automobile accident conclusive as to issues of negligence against the defendant in a subsequent action growing out of the same accident by the estate of another passenger against the same defendant?
(2) Is the above matter of discretion for the trial court?
We should at the outset define and clarify controlling principles which have been imprecisely employed and confused, not only by counsel but by the courts. The distinctions are set out with much clarity1 in Restatement Judgments, § 68 at 293, 294 as follows:
“It is important to distinguish the effect of a judgment as a merger of the original cause of action in the judgment or as a bar to a subsequent action
“On the other hand, where the subsequent action is based upon a different cause of action from that upon which the prior action was based, the effect of the judgment is more limited. The judgment is conclusive between the parties in such a case as to questions actually litigated and determined by the judgment. It is not conclusive as to questions which might have been but were not litigated in the original action. This is the doctrine of collateral estoppel.”
These controlling principles have been long and well recognized by this Court. Jones v. Chambers (1958), 353 Mich 674, and authorities cited therein.
It is obvious that, by very definition, one of the critical factors in applying the foregoing principles as to collateral estoppel involves the determination of whether the respective litigants were parties or privy to a party to an action in which a valid judgment has been rendered. Again, for definitional purposes,2 we turn to Bernhard v. Bank of America National Trust & Savings Ass‘n (1942), 19 Cal 2d 807 (122 P2d 892), which plaintiff urges upon us as
“Many courts have stated the facile formula that the plea of res judicata is available only when there is privity and mutuality of estoppel. (See cases cited in 2 Black, Judgments (2d. ed.), secs. 534, 548, 549; 1 Freeman, Judgments (5th ed.), secs. 407, 428; 35 Yale L.J. 607, 608; 34 C.J. 973, 988.) Under the requirement of privity, only parties to the former judgment or their privies may take advantage of or be bound by it. (Ibid.) A party in this connection is one who is ‘directly interested in the subject matter, and had a right to make defense, or to control the proceedings, and to appeal from the judgment.’ (1 Greenleaf, Evidence (15th ed.), sec. 523. See cases cited in 2 Black, Judgments (2d ed.), sec. 534; 15 R.C.L. 1009; 9 Va. L. Reg. (N.S.) 241, 242; 15 Cal. Jur. 190; 34 C.J. 992.) A privy is one who, after rendition of the judgment, has acquired an interest in the subject matter affected by the judgment through or under one of the parties, as by inheritance, succession, or purchase. (See cases cited in 2 Black, Judgments (2d ed.), sec. 549; 35 Yale L.J. 607, 608; 34 C.J. 973, 1010, 1012; 15 R.C.L. 1016.) The estoppel is mutual if the one taking advantage of the earlier adjudication would have been bound by it, had it gone against him. (See cases cited in 2 Black, Judgments (2d ed.), sec. 534, 548; 1 Freeman, Judgments (5th ed.), sec. 428; 35 Yale L.J. 607, 608; 34 C.J. 988; 15 R.C.L. 956.)”
Turning to the facts of the instant case, may it be legally concluded that either plaintiff‘s estate or Anna Sue were parties or privies in the former Federal suit so as to be concluded upon the issue of negligence in the instant suit? The trial court ruled in the affirmative as to Anna Sue but in the
Certainly it may not be contended that the legally-appointed representative of the estate of Hattie Howell or William Howell as an individual or guardian of James Howell was a party to Anna Sue‘s Federal action. They are separate legal entities: Anna Sue acting in her own individual right and the estate-individual-guardian acting in their legal capacities and prosecuting their separate claims.3 The parties remain as legal strangers, even though the latter were interested in the outcome of the action, or were witnesses, or participated in a limited representative capacity for the benefit of one of the parties. Restatement Judgments, § 93 pp 463, 464. In no sense did the estate-individual-guardian, although interested in the outcome, have the right to make defense, control the proceedings or appeal from a judgment which would have been adverse to Anna Sue‘s claim.
The conclusion equally applies to the converse situation. Although Anna Sue was clearly the party in the Federal suit and recovered judgment upon her personal injuries, she appears in the instant case solely as an heir at law of Hattie Howell and bases her claim exclusively upon rights derived from the latter‘s wrongful death. See, e.g., Complaint, Count I, ¶ 15. Thus, the general rule, as stated most succinctly in
To place this rule, which is frequently involved in litigation between receivers, co-obligors, stockholders, etc., in the proper factual perspective of personal injuries arising from automobile accidents, we quote from 133 ALR 181 at 185:
“With but few exceptions it has been held, in cases in which the question has arisen, that a judgment for the plaintiff in an action growing out of an accident was not res judicata, or conclusive, as to issues of negligence or contributory negligence, in a subsequent action growing out of the same accident, by a different plaintiff against the same defendant.”
As accurately observed by the annotator, this is the law in Michigan. Laskowski v. People‘s Ice Co. (1918), 203 Mich 186.
It is noted, furthermore, that were we to consider the plaintiff either as a party or privy thereto, the assertion of res judicata would still fail for want of mutuality. In short “both the litigants must be alike concluded by the judgment or it binds neither.”5
This, of course, lays bare the thrust of plaintiff‘s arguments on appeal, viz., that our Court abandon the well-established requirement of mutuality. We are unwilling to depart from the law recognized and reiterated in Clark v. Naufel (1950), 328 Mich 249,6 for the following reasons.
First, it is apparent from a review of the general authorities that those few jurisdictions which have abandoned or modified the mutuality requirement have done so in a very limited manner.7 Thus, the
“Unquestionably the negligence of defendant Caldwell which caused or contributed to James Nevarov‘s injuries was identical with the negligence which his parents assert against defendant. In James’ case it was not complicated by any claim of contributory negligence on his part and would fasten liability upon defendant though it operated only as a contributing proximate cause concurring
see also Currie, Mutuality of Collateral Estoppel: Limits of the Bernhard Doctrine, 9 Stanford L Rev 281 (1957); Currie, Civil Procedure: The Tempest Brews, 53 Cal L Rev 25 (1965); Moore and Currier, Mutuality and Conclusiveness of Judgments, 35 Tulane L Rev 301 (1961).
Although there may be merit to Justice Traynor‘s observation in Bernhard that the well-recognized exceptions to the mutuality rule in effect produce the same result as unilateral estoppel or non-mutuality, it should be noted that the recognized exceptions are confined to defensive pleading of collateral estoppel by only a certain class of defendants in special situations. See discussions in Spettigue v. Mahoney (1968), 8 Ariz App 281, 283 (445 P2d 557, 559); 1B Moore, Federal Practice, § 0.412, p 1801; Restatement Judgments §§ 96, 99, pp 472, 493; 31 ALR3d 1044, § 3b, p 1064. This fact is quite significant in determining whether collateral estoppel should or should not apply. As observed by the commentator in 31 ALR3d 1044 at 1072, “The courts are more inclined to permit the defensive, than the offensive, use of the doctrine of collateral estoppel“. In line with this general authority, see our Court‘s comments and holding in Walz v. Reliance Insurance Co. of Philadelphia (1922), 221 Mich 345, quoted with approval in DePolo v. Greig, supra, at 712.
Our Court, having more than passing familiarity and experience with the problem,9 adheres to its decision in Clark v. Naufel as applicable to the facts of the instant case.
A more fundamental reason for declining plaintiff‘s invitation to abandon the requirement of mutuality is that we are not convinced that to do so would promote the ends of justice or increase efficiency in the administration of our courts. Surely, we must strike a balance between the competing interests: (a) that the litigant against whom the doctrine is asserted has had his day in court; vis-a-vis (b) that repetitious and needless litigation which burden our already overloaded court dockets must be avoided. But we need not sacrifice a well-established and valuable rule to achieve this balance.
As noted by the commentators and the courts, many of the problems giving rise to res judicata
“This action is part of a larger pattern which has developed in personal injury cases in Los Angeles County and probably elsewhere in the state. The attorney who has a difficult case or group of cases on his hands files in the municipal court an action for recovery from a single defendant for property damage or minor personal injuries in the expectation that liability will be easily and speedily established and the question of damages left as the only issue to be decided in the principal action or actions brought in the superior court because res judicata establishes defendant‘s liability. This strategy (quite legitimate if Bernhard, supra, has universal application) is applied to multiple injuries to different people arising from the same accident. This occurs repeatedly in situations developed by accidents such as the collision of two aeroplanes over the Grand Canyon; the injury to many passengers on the San Diego-Los Angeles line of a railroad where the train was wrecked and the engineer claimed a momentary blackout; the breaking of the St. Francis Dam many years ago, followed by a great number of claims against the City of Los Angeles; the collision between the Andrea Doria and the Stockholm off the New England Coast in recent years. As several commentators have pointed out, Bernhard, supra, if held applicable to such situa-
Other examples may be multiplied.11 But the point to be observed is that such potential consequences will increase rather than diminish the burdens of our courts. As stated by Professor Moore:12
“But if the requirement of mutuality is abrogated, and an adverse judgment is thereby made available to the whole world collaterally to conclude the losing party on every adjudicated issue, no sensible and financially responsible litigant will, in certain situations, be willing to submit to an adverse judgment without exhausting every possible means to avert it. If such a judgment is thus made into something like an adverse in rem adjudication, with an invitation to the world to make the most of it, suits that might otherwise have been defaulted, compromised
Finally, our Court, when confronted by equally-forceful competing considerations, cannot, in all candor, hesitate to strike the balance in favor of our adversarial system. As pertains to abandonment of mutuality, we endorse the Court‘s comment in Spettigue v. Mahoney, supra, at 286:
“With some hesitation, because this court holds in veneration the acumen of the author of the Bernhard opinion, Chief Justice Roger J. Traynor, we suggest that this approach has turned wrong-side-out a natural burden. It is the adversary system that we have espoused in our system of justice. The adversary system prevails in many aspects of the life of man but contest rules seldom provide that one contestant must be declared the loser to a competitor that he has never met on the field of contest.”
We must in end analysis reaffirm the requirement of mutuality as held in Clark v. Naufel. Neither can we accept the proposition of the Court of Appeals that “the application of estoppel is best left to the discretion of the trial judge“. The course of justice is best served by adherence to a long-established and definitive rule which our bench and bar well recognizes rather than permit an ad hoc formulation of a rule based upon innumerable and unmanageable factors.13
ADAMS, T. E. BRENNAN, SWAINSON, and WILLIAMS, JJ., concurred with T. M. KAVANAGH, C. J.
BLACK, J. (concurring). Not caring to join the Court‘s unnecessary waltz around the country to the variable outstate music of estoppel by judgment, and being quite content with the concededly applicable value of our own pertinent precedents, particularly Clark v. Naufel (1950), 328 Mich 249 (syll. # 4), I concur in reversal.
Judge QUINN, dissenting below (20 Mich App 140, 147), was quite right in applying Clark v. Naufel, and in calling it to the attention of two Brethren
knows or has reason to fear that an adverse decision will be utilized by nonparties to the first action, he may very well proceed with greater vigor, but there is no assurance of this since insurance companies currently seek to dispose of property damage claims with the minimum of litigation expense. As the dissent in B. R. DeWitt Inc. v. Hall noted, how do we treat cases where the defendant has different liability insurers for personal injury claims and property damage claims? How can a judge evaluate the vigor of litigation in a case in which he did not sit? How can he weigh the difficulty a defendant faced by being forced to litigate in one jurisdiction rather than another? How did the burden of proof or applicable presumption affect the result?”
T. G. KAVANAGH, J., did not sit in this case.