CLS Associates, Ltd. v. A--- B---

• Decision Date: 14 November 1988
• Docket Number: No. 05-87-01186-CV,05-87-01186-CV
• Citation: 762 S.W.2d 221
• Parties: CLS ASSOCIATES, LTD., Appellant, v. A______ B______, Appellees.
• Court: Texas Court of Appeals

Page 221

762 S.W.2d 221

CLS ASSOCIATES, LTD., Appellant, v. A______ B______, Appellees.

No. 05-87-01186-CV.

Court of Appeals of Texas Dallas.

Nov. 14, 1988.

Rehearing Denied Dec. 15, 1988.

Douglas J. Brooks, Dallas, for appellant.

Paul M. Koning, Dallas, for appellees.

Before STEPHENS, STEWART and ROWE, JJ.

STEPHENS, Justice.

CLS Associates, Ltd. appeals an adverse summary judgment in its action against the law firm of A______ B______ alleging that the law firm committed malpractice and negligence while providing legal services to CLS. The trial court found that the malpractice claim was barred by res judicata arising from a prior suit to collect attorneys' fees due for the same services at issue in the instant suit. In three points of error, CLS asserts that the trial court erred in granting the summary judgment on the grounds of res judicata. We disagree and, accordingly, affirm the judgment of the trial court.

A______ B______ (Law Firm) performed legal services for CLS Associates, Ltd. pursuant to a contract. The Law Firm assigned its cause of action to D & L Collections (Collection Agency) when CLS failed to pay for the services rendered. The Collection Agency successfully collected the attorneys' fees. Subsequently, CLS brought a suit against the Law Firm for malpractice and negligence in connection with the same services which gave rise to the attorneys' fees suit. The Law Firm asserted the affirmative defense of res judicata and a summary judgment was granted in its favor.

In its first point of error, CLS asserts that the Law Firm's First Amended Original Answer was insufficient to support the trial court's finding that the cause of action was barred by res judicata. Specifically, CLS contends that res judicata cannot apply because the action which gave rise to the res judicata was on appeal; that the assertion of res judicata was an improper legal conclusion not supported by sufficient facts; that the causes of action in the attorneys' fees suit and the malpractice suit are not identical; and that the issues regarding malpractice were not in fact decided in the first suit. We hold that the Law Firm's First Amended Answer was sufficient to support a determination of res judicata for the reasons discussed herein.

In Scurlock Oil Co. v. Smithwick, 724 S.W.2d 1, 6 (Tex.1986), the Texas Supreme Court held that "a judgment is final for the purposes of issue and claim preclusion 'despite the taking of an appeal unless what is called an appeal actually consists of a trial de novo' " (quoting RESTATEMENT (SECOND) OF JUDGMENTS § 13 (1982)). The Court expressly overruled Texas Trunk Railroad Co. v. Jackson, 85 Tex. 605, 22 S.W. 1030 (1893) (a judgment on appeal insufficient to support plea of res judicata). Thus, the fact that the attorneys' fees case was on appeal is not a defense to the plea of res judicata since the appeal taken was not by trial de novo.

CLS further alleges that the assertion of res judicata in the Law Firm's First Amended Original Answer constituted a legal conclusion and was not supported by sufficient facts to support a summary judgment. Rule 94 requires only that all affirmative defenses such as res judicata be specifically pleaded to give notice of the issue to be raised. The pleading of specific facts is not necessary. TEX.R.CIV.P. 94. If the opponent desires more particular information, a special exception is necessary. See TEX.R.CIV.P. 90; Agnew v. Coleman Electric Cooperative, 153 Tex. 587, 272 S.W.2d 877, 879 (Tex.1954). Therefore, the Law Firm's assertion of res judicata without additional facts was sufficient to support the summary judgment in the absence of a special exception.

CLS also urges that the answer was insufficient to support a summary judgment because the cause of action presented in the attorneys' fees suit was not identical with the issue presented in this malpractice suit. As a general rule, a judgment on the merits in a suit on one cause of action is not conclusive of a subsequent suit on a different cause of action except as to issues of fact actually litigated and determined in the first suit. See Griffin v. Holiday Inns of America, 496 S.W.2d 535, 538 (Tex.1973). Here, the issue of the quality of the legal services was not actually litigated and determined in the attorneys' fees suit. Instead, the only matter litigated was whether the attorneys' fees were due. In our previous decision, we held in the attorneys' fees suit that the fees were indeed due and owing for services performed. (CLS Associates, Ltd. v. A------ B------ Collections, No. 05-86-00760-CV (Tex.App.--Dallas July 7, 1987) (unpublished)).

There is, of course, at least one exception to the general rule stated above. See Griffin, 496 S.W.2d at 538. That exception provides that res judicata bars litigation of all issues connected with a cause of action which, with the use of all diligence, might have been tried, as well as those which were actually tried. Ogletree v. Crates, 363 S.W.2d 431, 435 (Tex.1963). As we stated in Swiss Avenue Bank v. Slivka, 724 S.W.2d 394, 396 (Tex.App.--Dallas 1986, no writ), "[t]he Ogletree rule, however, applies only to the cause of action which was actually filed by the plaintiff and not to cross-actions which might have been filed by a defendant unless the compulsory counterclaim rule is applicable." See Chandler v. Cashway Building Materials, Inc., 584 S.W.2d 950, 954 (Tex.Civ.App.--El Paso 1979, no writ); TEX.R.CIV.P. 97. A claim of attorney malpractice has been held a compulsory counterclaim to a claim for attorneys' fees under Rule 97(a). Bailey v. Travis, 622 S.W.2d 143 (Tex.App.--Eastland 1981, writ ref'd n.r.e.); Corpus Christi Bank & Trust v. Cross, 586 S.W.2d 664 (Tex.Civ.App.--Corpus Christi 1979, writ ref'd n.r.e.). Thus, because CLS was required to assert the malpractice claim for negligently performed services in the attorneys' fees suit, the Ogletree rule is applicable. For these reasons, we overrule CLS' first point of error.

In its second point of error, CLS asserts that "malpractice and negligence" were not litigated or essential to the judgment in the attorneys' fees suit. This point is without merit because, as discussed in this opinion with regard to point of error one, the defensive issue of malpractice was a compulsory counterclaim. It arose from the same transactions as the attorneys' fees and would have prevented the recovery. Thus, it cannot be "barely collateral" to the...