McCourt v. Algiers
| Decision Date | 26 June 1958 |
| Citation | 4 Wis.2d 607,91 N.W.2d 194 |
| Parties | . Norbert E. ALGIERS et al., Respondents. Supreme Court of Wisconsin |
| Court | Wisconsin Supreme Court |
H. W. Dahms, Oconomowoc, for appellant.
Hale, Skemp, Hanson & Schnurrer, La Crosse, for respondents.
It is our conclusion that the issues of negligence were res judicata in McCourt's favor by virtue of the verdict and judgment of the federal court, and that there should be a new trial on the sole question of McCourt's damages.
1. Res judicata. In Rule's action against McCourt's insurer in the federal court, McCourt's insurer complained against Algiers and his insurer for contribution to any payment which it might have to make to Rude, alleging causal negligence on the part of Algiers; and Algiers cross-complained against McCourt's insurer for $15,000 damages alleged to have resulted to him from McCourt's negligence. McCourt was not a party to the action. The question of negligence of McCourt and Algiers was thoroughly litigated, and the final determination was that McCourt was not negligent at all, and that the accident resulted solely from the negligence of Algiers.
In the present case McCourt sued Algiers and his insurer for her damages resulting from the same accident, and claimed that it resulted solely from Algiers' negligence. Were the defendants entitled to relitigate the question of negligence as between Algiers and McCourt, or are they bound by the determination of the federal court that Algiers alone was the negligent cause of the accident?
There can be no question that if McCourt had been a party to the action in the federal court, the determination of that court would have been res judicata in the present case. The issues in each case with respect to causal negligence were the same, and the parties would have been the same.
'Where a question of fact essential to the judgment is actually litigated and determined by a valid and final judgment, the determination is conclusive between the parties in a subsequent action on a different cause of action' (with exceptions not here pertinent). Rest. Judgments, sec. 68(1).
'The final adjudication is conclusive, in a subsequent action between the same parties, as to all matters which were litigated or which might have been litigated in the former proceedings.' Cohan v. Associated Fur Farms, Inc., 261 Wis. 584, 597, 53 N.W.2d 788, 795.
The difficulty here arises from the fact that while McCourt's insurer was a party to the federal court action, McCourt herself was not. In our opinion that fact does not destroy the conclusive effect of the federal court's determination with respect to the issues of causal negligence.
While McCourt was not in privity with her insurer Northwestern in the strict sense of that term, nevertheless there was a close relationship between them with respect to the negligence issues in the federal court. Any potential liability of Northwestern was wholly derived from McCourt and based upon her conduct. Algiers asserted his claim against Northwestern because Northwestern was her insurer, and founded the claim on the premise that she had been negligent. In defending against the claims of Rude and Algiers, Northwestern was in a sense representing McCourt. With respect to the negligence issues it stood in her shoes.
If the federal judgment be held not conclusive in the present case, then Algiers and his insurer are given the privilege of trying the same issues of fact twice, once against McCourt's insurer and again against McCourt herself. Fundamentally the doctrine of res judicata is based on the proposition that repeated litigation of identical issues is undesirable where not necessary to prevent unfairness. Normally persons not parties nor in privity with a party to an action are not bound by the determination therein, because it would be unfair to bind them when they had no opportunity to participate. In the present case, however, there is no unfairness in binding Algiers and his insurer by the outcome of their first 'day in court'. They were both parties in the federal court, in response to a claim for contribution by McCourt's insurer. Algiers voluntarily elected to submit to the federal court his own claim against McCourt's insurer for his damages. Both of those claims directly presented the issues of negligence as between McCourt and Algiers. Algiers and his insurer were not merely nominal parties in the federal court, nor only perfunctorily concerned with the contest there. They both faced possible liability for contribution to the extent of one-half of Rude's very substantial damages, which the jury fixed at $10,000 and which were much more serious than those of McCourt. Algiers asserted his own damages in his cross-complaint at $15,000. Thus both of them had enough at stake to induce them to litigate the issues zealously and intensively, which they did.
Defendants contend that they cannot be concluded by the federal court determination in this action by McCourt, because McCourt would not have been concluded had the federal court found her negligent and Algiers not negligent, and the rule must work both ways, both parties being concluded or neither.
Such mutuality is not universally required in the operation of res judicata. Good Health Dairy Products Corp. v. Emery, 275 N.Y. 14, 17, 9 N.E.2d 758, 112 A.L.R....
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