Dean v. Exotic Veneers, Inc.
Decision Date | 30 January 1975 |
Citation | 271 Or. 188,531 P.2d 266 |
Parties | James P. DEAN, Appellant, v. EXOTIC VENEERS, INC., a corporation, and George R. Thompson, Respondents, Peter Boer et al., Intervenors. |
Court | Oregon Supreme Court |
Richard V. Bayless, Bauer, Murphy, Bayless & Fundingsland, Portland, argued the cause and filed briefs for appellant.
Donald H. Coulter, Myrick, Coulter, Seagraves & Nealy, Grants Pass, argued the cause for intervenors. With him on the brief was Michael Henderson, Grants Pass, counsel for respondents.
Before O'CONNELL, C.J., and McALLISTER, HOLMAN, TONGUE, HOWELL, BRYSON and SLOPER, JJ.
This is an action at law to recover an amount alleged to be due plaintiff for services rendered as general manager of the defendant corporation from 1962 to 1972. The defendant Thompson is the court-appointed receiver for liquidation of the defendant corporation; intervenors are defendant corporation stockholders who are resisting plaintiff's claim. Because their interests are identical, all parties other than plaintiff will be termed defendants. Plaintiff's claim is stated in two counts: the first upon an express contract for plaintiff's services; the second upon Quantum meruit for the reasonable value of those services. Plaintiff appeals from a judgment for defendants which was rendered pursuant to a directed verdict upon the ground of res judicata.
Prior to the commencement of the present action plaintiff had submitted a claim to the receiver for the payment of an amount due plaintiff under an alleged contract for services for the period in question. The receiver filed a petition with the circuit court having jurisdiction of the receivership for a determination of plaintiff's claim. A hearing on the merits was then held before the court which resulted in the court's directing the receiver to deny the claim. No appeal was taken from this determination. Plaintiff subsequently filed the present action.
Plaintiff first contends, without citation of authority, that the receivership court's denial of his claim is not a 'final order' disposing of his contract claim pursuant to ORS 19.010(2)(c) so as to be appealable and thus, is not the basis for a defense of res judicata. Assuming the trial court's determination would have to be appealable under the statute in order to support a defense of res judicata, plaintiff's position is not well taken and is refuted by Section 7924 of 16 Fletcher Cyclopedia of the Law of Corporations 660--61 (rev ed 1962):
'It is the usual practice for the court (where a receiver has been appointed) to refer the proof of all claims to a master in chancery or a special master. Claims are tried before him as before a court without a jury. Occasionally unusual claims are first tried before the court itself.
'All claims heard by the master in chancery are reported by him to the court. In the federal courts, unless exceptions are filed to the report within the required interval, the report stands confirmed. If exceptions are duly filed, the court will hear argument thereon, and render its decisions, either confirming, modifying or reversing the report of the master. The usual appeals may be taken from the decision of the court.
'The report of the master recommending the payment of claims, followed by the court's entry approving the same, constitutes a judgment of the court.' (Footnotes omitted.)
Plaintiff's principal contention is that even if his first count on a specific contract may not be relitigated, he is not precluded from litigating a claim based on the reasonable value of his services. As we said in Gwynn v. Wilhelm, 226 Or. 606, 608, 360 P.2d 312, 313 (1961):
* * *.'
Plaintiff contends his claim upon Quantum meruit is a different cause of action than his claim on the express contract. This brings into issue the definition of the term 'cause of action' as it relates to the law of res judicata. 'Cause of action' is a 'slippery' term which is used to express different concepts in different contexts. 1
The principal purposes of res judicata are prevention of harassment of defendants by successive legal proceedings as well as economy of judicial resources. Its scope is related to the limits upon the various forms of relief which may be requested in one proceeding and the limitations upon amendments to pleadings during trial. As permissible joinder of requests for various forms of relief and amendments during trial become broader and more liberal, the reasons behind res judicata dictate that parties to actions be required to make use of such liberal procedures and not be permitted to protract litigation through a multiplicity of suits or actions which can be disposed of in one proceeding. See Clark on Code Pleading 472--78 (2d ed 1947); also, Jarvy v. Mowrey, 235 Or. 579, 583, 385 P.2d 336 (1963). Therefore, with the advent of code pleading and the abandonment of rigid common law forms, the definition of 'cause of action' has tended to expand. As pointed out in Clark, Supra at 127:
Having in mind the purposes to be served by the application of the doctrine of res judicata, we agree with Clark in the following:
Clark on Code Pleading at 127.
Clark further states at 137:
* * *.' (Footnote omitted.)
If in the present case we apply Clark's concept of 'cause of action' for res judicata purposes, it becomes apparent that there is but a single occasion for judicial relief, even though there are alternative contentions concerning the circumstances under which they were rendered and thus alternative grounds or theories for recovery. To the extent that a given state of facts is susceptible to alternative interpretation and analysis, plaintiff must seek and exhaust all alternative grounds or theories for recovery in one action.
Plaintiff claims to have rendered only one set of services. Nothing prevented him from presenting his claim against the receiver on the alternative theories of express contract and Quantum meruit and from having them both adjudicated at the same time. Having once litigated his claim against defendant, he should be foreclosed from further litigation on all grounds or theories of recovery which could have been litigated in the first instance. The public policy to be served by the doctrine of res judicata prevents him from having two bites at the apple. In Developments in the Law--Res Judicata, 65 Harv.L.Rev. 818, 826 (1952), the following statement is found:
(Footnotes omitted.)
For a case which holds that an adverse judgment on an action on an express contract is a bar to a subsequent action on Quantum meruit, see Golden v. Mascari, 63 Ohio App. 139, 25 N.E.2d 462 (1939). For the purposes of the application of the statute of limitations we have held that an amended complaint on Quantum meruit is a restatement of the same cause of action as that in the original complaint on an express contract. Richardson v. Investment Co., 124 Or. 569, 571--572, 264 P. 458, 265 P. 1117 (1928).
Many cases decided on the Specific question are contrary to the above conclusion and authority. In Jarvy v. Mowrey, Supra, a decedent's estate filed suit against decedent's sister to secure the return of certain bank accounts transferred to the sister by decedent. In defense, the sister alleged that the money was paid to her in payment of an indebtedness and attempted to prove she earned the money caring for the decedent. Her pleadings were ambiguous as to whether her claim was for the reasonable value of her services or upon her right under a specific contract, or both. Upon trial the sister lost and was required to return the money to the estate. Thereupon the sister brought an action on implied contract for the...
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