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The Doctrines of Res Judicata and Collateral Estoppel

These two doctrines establish the rule that once a case has reached a final judgment, relitigation of the claims and issues generally is barred.

 

Res Judicata (Claim Preclusion)

  1. Rule: If judgment is rendered in favor of a plaintiff in a particular suit, the plaintiff is precluded from raising claims (in any future litigation) which were raised in (or could have been raised) in that lawsuit.

  2. Elements: Before a court will apply the doctrine of res judicata to a claim, three elements must be satisfied:

    1. There must have been prior litigation in which identical claims were raised (or could have been raised). In general, claims are sufficiently identical if they are found to share a “common nucleus of operative fact.”

    2. The parties in the second litigation must be identical in some manner to the parties in the original litigation, or be in privity with the parties in the first action.

      Note: A party is considered to be in privity with a party in the original litigation if:

      1. The nonparty succeeded to the interest of a party;

      2. The nonparty, though it did not technically participate in the first suit, controlled one party’s litigation in that suit;

      3. The nonparty shares a property interest with the party;

      4. The party and the nonparty have an agency relationship (agent/principal); or

      5. The party otherwise adequately represented the interest of the nonparty in the previous litigation.

    3. There must have been a final judgment on the merits in the original litigation. Note: Not all final judgments are based on the merits of the case (i.e., cases dismissed on jurisdictional grounds, etc.).

  3. Scope: Res judicata bars relitigation of claims that were previously litigated as well as claims that could have been litigated in the first lawsuit.

  4. Counterclaims:Res judicata is generally not applied to potential counterclaims by defendants, so defendants are not necessarily barred from raising a counterclaim in future litigation. However, remember that all counterclaims must conform to FRCP Rule 13(a), and that some counterclaims are compulsory (must be raised in original litigation or they are waived).

 
 

Collateral Estoppel (Issue Preclusion)

  1. Rule: If an issue has been decided in a particular case, it is treated as decided—without further proof—in any subsequent litigation that involves the issue. In other words, a person or party who seeks to relitigate any already decided issue is collaterally stopped from doing so.

  2. Elements: Before a court will apply the doctrine of collateral estoppel, three elements must be satisfied:

    1. There must have been a prior litigation in which the identical issue was brought before the court.

    2. The issue must have been actually litigated in the first judicial proceeding, and the party against whom collateral estoppel is being asserted must have had a full and fair opportunity to litigate the issue in the first judicial proceeding.

    3. The issue must necessarily have been decided and rendered as a necessary part of the court’s final judgment.

  3. Scope: Unlike res judicata, collateral estoppel does not bar future litigation over issues not actually raised in the original judicial proceeding, even if the issues could have been raised.

  4. Who may be bound: The old rule that only the actual parties (and those in privity with the actual parties) to the first judicial proceeding may be bound by the court’s findings/decision on the issue has been virtually abolished. Increasingly, courts have been willing to allow strangers (persons not involved in the first litigation) to use collateral estoppel in various situations to prevent another party from relitigating an issue.