The Chancery Division granted plaintiff’s claim for specific performance of the defendant’s agreement to convey premises in Woodbridge and denied the defendant’s counterclaim for the alleged wrongful act of the plaintiff in delaying or preventing her removal of the building located thereon and then demolishing it. The defendant appealed to the Appellate Division contending that there was error in the dismissal of her counterclaim and that she was entitled to a jury trial on the issue which it raised. This contention was sustained in an opinion by Judge Clapp reported in 32 N. J. Super. 197 (App. Div. 1954), and the counterclaim was remanded for trial. We granted certification under R. R. 1:10-2. See 17 N. J. 226 (1955).
Since 1952 the plaintiff has been engaged in building the Garden State Parkway. See Town of Bloomfield v. New Jersey Highway Authority, 18 N. J. 237 (1955). In 1953 it determined that the defendant’s property in Woodbridge would be required for the Parkway and it negotiated with the defendant for its purchase. On March 21, 1953 a contract was entered into between the plaintiff and the defendant which provided that the property would be conveyed for the sum of $17,500; the contract stated that the defendant could remove the building on the property on or before April 1, 1953. The building was never removed by the defendant but was demolished by the plaintiff’s contractor on May 27, 1953 and the land was actually occupied by the plaintiff and used for Parkway purposes. On May 19, 1953 the plaintiff instituted an action in the Law Division demanding judgment for possession and specific performance, preliminary injunctive relief, and mesne damages. This action was dismissed by a stipulation dated June 4, 1953. The plaintiff contends that the stipulation was signed pursuant to an agreement between counsel that the defendant would perform the contract and the parties would “exchange general releases”; the defendant contends that no one had authority to enter into such agreement on her behalf and general releases were never executed.
The defendant contends and the Appellate Division found that the Chancery Division’s determination that the plaintiff was entitled to specific performance of the March 21 agreement did not dispose of her counterclaim which must await trial by jury. The pretrial order set forth that there were equitable as well as legal issues involved and that “all equitable issues arising out of the complaint, the defense and counter
After the foregoing colloquy, counsel for the plaintiff called an employee of the Lawyers-Clinton Title Insurance Company of New Jersey who testified that she had asked the defendant to sign a deed but that the defendant had refused, and Mr. Gillette, the attorney for the defendant who signed the stipulation dismissing the Law Division action and testified with respect thereto. The defendant’s counsel then recalled Mr. Sladkus, the defendant Mary Eenner and her daughter Marianne, who testified generally with respect to Mr. Gillette’s participation in the Law Division action. No further witnesses were called and although the record is somewhat obscure
In his oral opinion the trial judge found that the defendant had duly executed the March 21 agreement and that the plaintiff was entitled to have it specifically performed. He made no direct findings or references to the digging of the moat and its effect. He did state generally that he could find nothing “inequitable or unconscionable” in the plaintiff’s actions and that it had been “exceptionally patient.” But that did not constitute an affirmative finding that the plaintiff had not wrongfully delayed or prevented the removal of the building by the digging of the moat; indeed, in view of the meager and confused state of the record such an
Our judicial system contemplates that generally all matters in controversy between the parties, whether legal or equitable, will be disposed of in a single action. See
Massari v. Einsiedler,
6
N. J.
303, 313 (1951);
Garrou v. Teaneck Tryon Co., 11 N. J.
294, 305 (1953);
Asbestos Fibres, Inc. v. Martin Laboratories, Inc.,
12
N. J.
233, 239 (1953);
Tumarkin v. Friedman,
17
N. J. Super.
20, 24
(App. Div.
1951), certification denied 9
N. J.
287 (1952). Where, as here, the plaintiff brings an action to enforce a contract the defendant is obliged to set forth all the defensive matter upon which he may at any time seek to rely.
R. R.
4:12-2;
R. R.
4:12-8;
Schnitzer and Wildstein, N. J. Rules Service,
A-IV-226. And while we have not adopted
Federal Buie
13
(a)
relating to compulsory counterclaims seeking affirmative relief
(cf. B. B.
4:13-1) we have sought to encourage defendants to assert such affirmative claims as they may have in the form of counterclaims rather than independent actions; indeed, the line between the defensive and other matter may be indistinct and the safer course generally will be to set it all forth by way of answer and counterclaim. See
Massari v. Einsiedler, supra,
where the defendant failed to seek reformation in the original action instituted against him but, after an adverse decision, filed an independent reformation proceeding contending that the relief he sought was not defensive but was the proper subject of an independent action; the court rejected the defendant’s contention and held that the
In the instant matter the defendant claimed that the plaintiff had wrongfully interfered with her right to remove the building and had demolished it, thereby causing damages which she sought to recover. She was entitled to assert such claim even without regard to the plaintiff’s right to specific performance; she could presumably have set it forth in an independent action triable by jury; instead she properly sought her relief in the form of a counterclaim. When this was done the trial judge had before him the plaintiff’s equitable claim for specific performance and the defendant’s legal claim for damages and it was his responsibility to fix the sequence of trial. See B. B. 4:40-2 which expressly provides that, “When certain of the issues are to be decided by a jury and others by the court, the court may determine the sequence in which such issues shall be tried.” In accordance with the widespread practice in our State, the trial judge determined that the plaintiff’s equitable action for specific performance would be tried first; in federal practice the court generally endeavors to seek out the basic issue in the entire litigation and have it control the sequence of trial. See 5 Moore, Federal Practice, 148, 179 (1951). The specific performance action was tried first and completed and the parties may not deny that once it was decided the issues actually there presented and finally determined became binding; under acknowledged public policy principles of res judicata and collateral estoppel the parties could not relitigate them in the same or separate proceedings involving the same or separate causes of action. See Restatement, Judgments, § 1, p. 9, § 68, p. 293 (1942); Scott, Collateral Estoppel by Judgment, 56 Harv. L. Rev. 1 (1942). Cf. United States v. Munsingwear, 340 U. S. 36, 71 S. Ct. 104, 105, 95 L. Ed. 36 (1950); Bango v. Ward, 12 N. J. 415 (1953). In the Munsingwear case Justice Douglas recently quoted approvingly from Southern Pacific R. Co. v. United States, 168 U. S. 1, 48, 18 S. Ct. 18, 27, 42 L. Ed. 355, 377 (1897) where the court said:
“The general principle announced in numerous cases is that a right, question, or fact distinctly put in issue, and directly determined by a court of competent jurisdiction, as a ground of recovery, cannot be disputed in a subsequent suit between the same parties or their privies; and even if the second suit is for a different cause of action, the right, question or fact once so determined must, as between the same parties or their privies, be taken as conclusively established, so long as the judgment in the first suit remains unmodified.”
See Templeton v. Scudder, 16 N. J. Super. 576, 583 (App. Div. 1951); Stone v. William Steinen Mfg. Co., 7 N. J. Super. 321, 327 (Cty. Ct. 1949), affirmed 6 N. J. Super. 178 (App. Div. 1950); Hudson Transit Corp. v. Antonucci, 137 N. J. L. 704, 706 (E. & A. 1948); In re Walsh’s Estate, 80 N. J. Eq. 565, 569 (E. & A. 1909).
We assume, therefore, that if, in the instant matter, the issue resting on the digging of the moat had actually been presented and finally determined against the defendant in the specific performance action, then the counterclaim would have been barred. However, as we have hereinbefore indicated, that may not fairly be said to have occurred. Erom the start the parties proceeded on the basis that the issue raised in the counterclaim was not merely incidental to the equitable cause of action
(cf. Steiner v. Stein, 2 N. J.
367
(1949); O’Neill v. Vreeland,
6
N. J.
158 (1951)), but was an independent cause of action triable by jury. The parties presumably realized that the plaintiff, as a public body with condemnation powers, could not have been prevented from taking the defendant's land and, in fact, it had possession thereof during the entire proceedings. The defendant might well have tendered a deed, reserving her right to litigate the counterclaim; instead, she filed answer which contained matters which have been abandoned but also indicated her willingness to deliver a deed upon reimbursement “for consequential damages to her property” as sought in her counterclaim. Although the granting of specific performance is ordinarily discretionary
(Gulvin v. Sunshine
Park,
Inc.,
137
N. J. Eq.
249
(E. & A.
1945)) there was, in view of the public nature of the plaintiff, hardly any room for the exercise
Affirmed.