Dillard v. Security Pacific Brokers, Inc.
| Decision Date | 15 January 1988 |
| Docket Number | No. 87-2673,87-2673 |
| Citation | 835 F.2d 607 |
| Parties | , RICO Bus.Disp.Guide 6847 Carvel DILLARD, Plaintiff-Appellant, v. SECURITY PACIFIC BROKERS, INC. and Financial Clearing & Services Corp., Defendants-Appellees. |
| Court | U.S. Court of Appeals — Fifth Circuit |
Carvel Dillard, pro se.
William M. Parrish, Dallas, Tex., for defendants-appellees.
Appeal from the United States District Court for the Southern District of Texas.
Before GEE, GARWOOD and JONES, Circuit Judges.
This appeal presents a bizarre fact situation and one narrow issue of first impression in our circuit.
Carvel Dillard, appearing pro se both here and in the trial court, sued the defendant brokers on negligence and various other theories to recover losses that he claims he suffered when they refused to execute buy orders that he gave them. Dillard had, however, financed the proposed stock transaction with admittedly hot checks which he gave the brokers, in consequence of which they suffered a loss of over $50,000. In a prior action to Dillard's pro se one against them, they sought recovery against him for this loss. Dillard answered, raising the supposed negligence of the brokers in failing to execute his orders, but failed to comply with discovery orders and suffered a consequent judgment. After his answer was filed in the first action, a criminal prosecution of Dillard based on the worthless checks was commenced. The defendant brokers contend that the claims which Dillard asserts in the present action were compulsory counterclaims in their earlier one and, hence, that they are subject to the bar of the prior judgment. The trial court agreed and dismissed Dillard's suit. We also agree in large part, but must reverse as to one group of Dillard's claims--those which stem from his criminal prosecution.
In our Circuit the applicable test for determining whether res judicata bars a party's claim is:
For a prior judgment to bar an action on the basis of res judicata, the parties must be identical in both suits, the prior judgment must have been rendered by a court of competent jurisdiction, there must have been a final judgment on the merits and the same cause of action must be involved in both cases.... This Court has recognized that the principal test for comparing causes of action is whether the primary right and duty or wrong are the same in each action.
Nilsen v. City of Moss Point, 701 F.2d 556, 559 (5th Cir.1983).
The first two factors of this test are undisputedly present in this case. Dillard's first argument--that res judicata should not apply because the original determination by Judge Bue was not an adjudication on the merits (the third factor)--is meritless. While a voluntary dismissal without prejudice has no res judicata effect, Plumberman, Inc. v. Urban Systems Development Corp., 605 F.2d 161, 162 (5th Cir.1979), a dismissal with prejudice at any stage of a judicial proceeding ordinarily constitutes a final judgment on the merits which bars a later suit on the same cause of action. Astron Industrial Associates, Inc. v. Chrysler Motors Corp., 405 F.2d 958, 960 (5th Cir.1968).
Fed.R.Civ.P. 41(b) provides in pertinent part that, after a motion to dismiss for failure to comply with the federal rules, "Unless the court in its order for dismissal otherwise specifies a dismissal under this subdivision ... operates as an adjudication upon the merits." Dismissal of a case for failure to appear for the taking of a deposition (which happened with Dillard's counterclaim in the original case), constitutes a judgment on the merits, is res judicata, and bars a subsequent action.
In the original case, moreover, Dillard was warned by the court that his failure to obey an order and appear at a scheduled deposition would result in a "judgment by default" being rendered against him. The court had authority under Fed.R.Civ.P. 37(b)(2)(C) to "dismiss[ ] the action or proceeding" or to render "a judgment by default against the disobedient party...." Although the discretion employed in selecting an appropriate sanction is subject to appellate review, Dillard did not appeal Judge Bue's judgment. This judgment is therefore a final one, on the merits and of a...
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Besing, Matter of
...result would obtain under Fifth Circuit precedent. See In re Reed, 861 F.2d 1381, 1382-83 (5th Cir.1988); Dillard v. Security Pacific Brokers, Inc., 835 F.2d 607, 608 (5th Cir.1988).16 The Debtors raise (but, again, fail to brief) two additional arguments that warrant very little discussion......
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New York Life Ins. Co. v. Deshotel
...and her failure to plead it bars her from bringing it as a later independent action in federal court. See Dillard v. Security Pac. Brokers, Inc., 835 F.2d 607, 609 (5th Cir.1988); Ake v. Chancey, 149 F.2d 310 (5th Cir.1945); 3 Moore, supra p 13.14; WRIGHT, supra § 1417, at Under Louisiana l......
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Assoc.D Auto. Inc v. Acceptance Indem. Ins. Co.
...Application of the fourth element in this case turns on the scope of the compulsory counterclaim rule. See Dillard v. Security Pacific Brokers, Inc., 835 F.2d 607, 609 (5th Cir.1988) (stating that whether a plaintiff investor's claims against defendant stockbrokers were barred by res judica......
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Mohamed v. Exxon Corp.
...the court of appeals applied rule 41(a) and held res judicata unavailable. A contrary result occurred in Dillard v. Security Pac. Brokers, Inc., 835 F.2d 607 (5th Cir.1988). There the trial court had dismissed a litigant's counterclaim as a sanction for failure to appear at a deposition. On......