CLAIM & ISSUE PRECLUSION

Claim and Issue Preclusion – General Rule

Whenever there has been an earlier case, the judgment already entered in Case 1 MAY preclude litigation of any matters in Case 2

Claim and Issue Preclusion – Choice of Law

If Case 1 and Case 2 are in a different judicial system, the court in Case 2 applies the preclusion law of the judicial system that decided Case 1

Claim Preclusion (Res Judicata) – General Rule

A claimant may only sue once to seek recovery for all rights to relief for that claim

Claim Preclusion (Res Judicata) – Requirements

For a claim to be precluded, (1) the same plaintiff must be suing the same defendant, (2) Case 1 must have ended in a final judgment on the merits, and (3) the cases must assert the same claim

When is a judgment NOT on the merits?

If it was based on a lack of personal jurisdiction or SMJ, improper venue, or failure to join an indispensable party

Majority View for “Claim”

Any right to relief arising from a transaction or occurrence

Issue Preclusion (Collateral Estoppel) – General Rule

If an issue was litigated in Case 1 and the same issue is presented in Case 2, then the issue cannot be re-litigated, and it is deemed established in Case 2

Issue Preclusion (Collateral Estoppel) – Requirements

(1) Case 1 ended in a valid final judgment on the merits, (2) the same issue was actually litigated and determined in Case 1, (3) the issue was essential to the judgment in Case 1, (4) the party who is being precluded was a party in Case 1 or in privity with a party, and (5) the person who is using the preclusion was a party to Case 1, or was not a party to Case 1, as long as nonmutual offensive or defensive issue preclusion is met

Nonmutual Defensive Issue Preclusion

If the person using the preclusion was NOT a party to Case 1 and is the defendant in Case 2, then issue preclusion is okay so long as the plaintiff had the chance to fully litigate the issue in Case 1

Nonmutual Offensive Issue Preclusion – General Rule

If the person using the preclusion was NOT a party to Case 1 and is the plaintiff in Case 2, then issue preclusion is NOT allowed unless the fairness factors weigh in favor of it

Nonmutual Offensive Issue Preclusion – Fairness Factors

In determining whether nonmutual offensive issue preclusion is fair, the court will consider whether (1) the party to be bound had a full and fair opportunity to litigate in Case 1, (2) the party to be bound had a strong incentive to litigate in Case 1, (3) the party asserting issue preclusion could have easily joined to Case 1, and (4) there have been no inconsistent findings on the issue