Evans v. Ely

• Decision Date: 20 February 1929
• Docket Number: No. 3919.,3919.
• Citation: 30 F.2d 912
• Parties: EVANS v. ELY.
• Court: U.S. Court of Appeals — Third Circuit

30 F.2d 912 (1929)

EVANS v. ELY.

No. 3919.

Circuit Court of Appeals, Third Circuit.

February 20, 1929.

Pepper, Bodine, Stokes & Schoch and Isaac A. Pennypacker, all of Philadelphia, Pa., for appellant.

Guckes, Shrader, Burtt & Thornton, and J. Rech Guckes, all of Philadelphia, Pa., for appellee.

Before BUFFINGTON, WOOLLEY, and DAVIS, Circuit Judges.

WOOLLEY, Circuit Judge.

There were two suits in assumpsit between the same parties, arising out of the same transaction, tried in the same court on substantially the same evidence but on different causes of action. In the latter action, the one here on appeal, the trial court directed a verdict for the defendant on holding that the judgment in the former action — in which it found the same matters here involved had been determined — operates as an estoppel of the instant suit and on a finding that, apart from the doctrine of estoppel, the evidence does not sustain the contract or contracts declared on. The plaintiff appealed.

For a statement of the transaction on which both cases were grounded reference is made to the opinion of this court in Evans v. Ely (C. C. A.) 13 F.(2d) 62; and for a statement of the applicable law of res judicata or estoppel by judgment it will be enough to cite Cromwell v. County of Sac, 94 U. S. 351, 353, 354, 24 L. Ed. 195 and Southern Pacific Railroad Co. v. United States, 168 U. S. 1, 48, 18 S. Ct. 18, 27 (42 L. Ed. 355), and quote these pronouncements upon the doctrine:

"* * * It should be borne in mind, * * * that there is a difference between the effect of a judgment as a bar or estoppel against the prosecution of a second action upon the same claim or demand, and its effect as an estoppel in another action between the same parties upon a different claim or cause of action. In the former case, the judgment, if rendered upon the merits, constitutes an absolute bar to a subsequent action. It is a finality as to the claim or demand in controversy, concluding parties and those in privity with them, not only as to every matter which was offered and received to sustain or defeat the claim or demand, but as to any other admissible matter which might have been offered for that purpose. * * *

"But where the second action between the same parties is upon a different claim or demand, the judgment in the prior action operates as an estoppel only as to those matters in issue or points controverted, upon the determination of which the finding or verdict was rendered."

"The general principle announced in numerous cases is that a right, question or fact distinctly put in issue and directly determined by a court of competent jurisdiction, as a ground of recovery, cannot be disputed in a subsequent suit between the same parties or their privies; and even if the second suit is for a different cause of action, the right, question or fact once so determined must, as between the same parties or their privies, be taken as conclusively established, so long as the judgment in the first suit remains unmodified."

The essence of estoppel by judgment being that there has been a judicial determination of a fact, the question pertinent in this case, as in all cases raising the doctrine, is, has there been such a determination here?

Speaking of the parties as they stood in the trial court, the plaintiff in the first suit declared on an oral agreement, averring that thereby he engaged to sell certain shares of stock and the defendant agreed to buy them, not for himself but for the traction company of which he was president, and that the defendant refused to take and pay for the shares, admitting that he had no authority from the company to make such a contract, and sought to recover for the damages he had sustained by the breach of this oral agreement on the liability of the defendant arising out of an implied warranty of his authority to make the oral contract on behalf of his company, binding him as though he had made it on his own behalf. On that issue manifestly the court had to look for and find evidence that the parties made such an oral agreement before it could allow the jury to hold the defendant on an implied warranty of authority to make the agreement. The trial court, and then this court on appeal, viewed everything that had transpired before the plaintiff signed a written contract of sale (not there in evidence but which it was admitted the defendant did not sign) as negotiations leading up to the proposed written contract and held that the facts, conceded or definitely proved, did not establish an antecedent oral contract between the parties and disposed of the case accordingly. That is...