Wong v. Smith

Citation961 F.2d 1018
Decision Date03 April 1992
Docket NumberNo. 91-2157,91-2157
PartiesAllan Y.K. WONG, Trustee of Island Realty Trust, Plaintiff, Appellant, v. William H. SMITH and Aline J. Smith, Defendants, Appellees. . Heard
CourtUnited States Courts of Appeals. United States Court of Appeals (1st Circuit)

Ray Aaionian, on brief for plaintiff, appellant.

Janet Macnab, on brief for defendants, appellees.

Before BREYER, Chief Judge, CAMPBELL, Senior Circuit Judge, and SELYA, Circuit Judge.

PER CURIAM.

Allan Y.K. Wong, as trustee of the Island Realty Trust, bought an apartment house in Sanford, Maine from William and Aline Smith. The Smiths represented to Wong that the walls of the house were insulated with fiberglass. After the sale, Wong discovered that the walls also contained urea formaldehyde insulation, which has been linked to certain health problems.

In March 1987, Wong sued the Smiths in a Maine Superior Court. Though the complaint was brief and did not expressly identify the legal theory upon which Wong sought recovery, the parties and the Superior Court read the complaint to state a claim for fraud.

The Smiths moved for summary judgment in October 1987. In January 1988, a week before the Superior Court ruled on the motion for summary judgment, Wong moved to amend his complaint to add two new counts for breach of contract and breach of warranty.

On February 2, 1988, the superior court (1) granted Wong's motion to amend (which meant that the court now had before it a three-count complaint alleging fraud, breach of contract and breach of warranty), and (2) granted the Smiths summary judgment on the "fraud count." The breach of contract and breach of warranty counts remained, and in May 1988 the Smiths moved for summary judgment on them. In October 1988, however, before the Superior Court could rule on the second motion for summary judgment, Wong voluntarily dismissed the case. At the time, Maine R.Civ.P. 41(a) allowed plaintiffs to dismiss unilaterally, and without prejudice, "at any time before commencement of trial." As far as the record on appeal shows, the state court lawsuit ended with the filing of the notice of dismissal.

In January 1991, Wong sued the Smiths in the United States District Court for the District of Massachusetts. Relying on diversity of citizenship for jurisdiction, Wong again alleged that he had been injured by the Smiths' failure to tell him about the presence of urea formaldehyde insulation in the walls of the apartment house. The federal complaint asserted claims against the Smiths for breach of contract, misrepresentation and fraudulent concealment.

The Smiths moved for summary judgment, contending that res judicata barred the federal suit. Wong opposed the motion, and also moved to amend the complaint to add a count for breach of warranty. The district court granted the motion to amend, then dismissed the action "on the grounds of res judicata." This appeal followed. We affirm.

"In applying res judicata, 'a federal court must give to a state court judgment the same preclusive effect as would be given that judgment under the law of the state in which the judgment was rendered.' " Crane v. Commissioner of Department of Agriculture, Food and Rural Resources, 602 F.Supp. 280, 285 (D.Me.1985) (quoting Migra v. Warren City School District Board of Education, 465 U.S. 75, 81, 104 S.Ct. 892, 896, 79 L.Ed.2d 56 (1984)). Under Maine law, a court can apply the doctrine of res judicata (which we will refer to, for clarity's sake, as "claim preclusion") if it is satisfied that (1) the same parties, or their privies, are involved in both actions, (2) a "valid final judgment" was entered in the first action, and (3) "the matters presented for decision were, or might have been, litigated in the prior action." Beegan v. Schmidt, 451 A.2d 642, 644 (Me.1982) (quoting Kradoska v. Kipp, 397 A.2d 562, 565 (Me.1979)).

The first and third elements are not debatable here. The parties are exactly the same in both cases. Whether or not all of the matters presented for decision in the federal case actually were litigated in the state court, it is clear that all of Wong's federal counts "might have been" litigated there. Because the state and federal complaints alleged exactly the same wrong (the failure to disclose the presence of urea formaldehyde) and asked for essentially the same relief (damages to compensate the wrong), they both asserted the same "cause of action," a term defined by Maine law to mean "the aggregate of connected operative facts that can be handled together conveniently for purposes of trial." Kradoska v. Kipp, 397 A.2d at 568.

The controlling question here is whether the disposition of the state court action satisfied the requirement of a "valid final judgment." "The application of res judicata ... requires as a predicate a valid final judgment in the prior action." S.H. Nevers Corp. v. Husky Hydraulics, Inc., 408 A.2d 676, 679 (Me.1979). The Superior Court docket is not in the record on appeal, but it does not appear that the state court ever had the opportunity to issue or enter a formal, "final" judgment.

The Superior Court gave the Smiths a judgment on the fraud count, but that judgment was not "final" when rendered because it did not completely "dispose[ ] of the action and leave[ ] no further question for consideration by the court." Crane v. Commissioner, 602 F.Supp. at 288 (citing Martel v. Inhabitants of the Town of Old Orchard Beach, 404 A.2d 994, 995 (Me.1979)). Rather, the grant of summary judgment left the newly-added breach of contract and breach of warranty counts open for adjudication. See Bacon v. Penney, 418 A.2d 1136, 1140 and n. 4 (Me.1980) (grant of "partial summary judgment" was interlocutory, not appealable, and had no res judicata effect).

Had the breach counts been litigated to a conclusion, of course, the Superior Court would have entered a "final" judgment that disposed of both the breach and the fraud counts. But the Superior Court action ended with Wong's voluntary dismissal. Under Maine law, a voluntary dismissal is without prejudice, and not "final" for purposes of the claim preclusion doctrine, unless the plaintiff "has once dismissed in any court of this state or any other state of the United States an action based on or including the same claim." Maine R.Civ.P....

To continue reading

Request your trial
8 cases
  • Ossman v. Diana Corp.
    • United States
    • U.S. District Court — District of Minnesota
    • June 29, 1993
    ...other courts finding that settlement of an action does preclude the application of collateral estoppel. See e.g., Wong v. Smith, 961 F.2d 1018, 1020 (1st Cir.1992) (analyzing several states' laws in finding that under Massachusetts law, voluntary dismissal of an action that has been fully l......
  • Blevens v. Town of Bow, NH
    • United States
    • U.S. District Court — District of New Hampshire
    • October 12, 1994
    ...104 S.Ct. 892, 896, 79 L.Ed.2d 56 (1984). See also Allen v. McCurry, 449 U.S. 90, 101 S.Ct. 411, 66 L.Ed.2d 308 (1980); Wong v. Smith, 961 F.2d 1018 (1st Cir.1992). Under New Hampshire law, "the doctrine of res judicata precludes the litigation in a later case of matters actually litigated,......
  • Cubie v. Bryan Career College, Inc.
    • United States
    • U.S. District Court — District of Kansas
    • January 28, 2003
    ...788 F.2d 1433, 1435 (10th Cir.1986) (citation omitted).s 36. 20 U.S.C. § 1681 et seq. 37. 20 U.S.C. § 1681(a). 38. Y.K. Wong v. Smith, 961 F.2d 1018, 1019 (1st Cir.1992) (citations omitted); Knox v. Lederle Lab., 4 F.3d 875, 878 (10th Cir. 1993) (stating that "[b]ecause this case concerns a......
  • Grimmett v. S & W Auto Sales Co.
    • United States
    • Court of Appeals of Kansas
    • September 17, 1999
    ...federal circuits and state courts have relaxed the definition of finality for preclusion doctrine purposes. See, e.g., Wong v. Smith, 961 F.2d 1018 (1st Cir. 1992) (invoking res judicata); John Morrell & Co. v. Local Union 304A, 913 F.2d 544 (8th Cir. 1990) (invoking collateral estoppel); S......
  • Request a trial to view additional results

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT