McDougall v. Palo Alto Unified School Dist.

• Decision Date: 29 January 1963
• Citation: 212 Cal.App.2d 422,28 Cal.Rptr. 37
• Court: California Court of Appeals Court of Appeals
• Parties: Albert McDOUGALL et al., Defendants and Appellants, v. PALO ALTO UNIFIED SCHOOL DISTRICT, Defendant and Respondent. Civ. 19616.

Page 37

28 Cal.Rptr. 37

212 Cal.App.2d 422

Albert McDOUGALL et al., Defendants and Appellants, v. PALO ALTO UNIFIED SCHOOL DISTRICT, Defendant and Respondent.

Civ. 19616.

District Court of Appeal, First District, Division 1, California.

Jan. 29, 1963.

John W. Montgomery, Peter Anello, San Jose, for appellants.

Rankin, Oneal, Luckhardt & Center, C. E. Luckhardt, Charles E. Luckhardt, Jr., San Jose, for respondents.

SULLIVAN, Justice.

We determine here conflicting claims to one-fourth of an award made in condemnation proceedings.

The parcel of land involved is presently located in the City of Palo Alto and formerly, before consolidation of the two municipalities, in the town of Mayfield. On August 31, 1867, William Paul as party of the first part conveyed the land to Joseph N. Spencer, George W. La Peire and Alexander Young, trustees of the Mayfield School District as parties of the second part. Appellants are successors in interest of the grantor. Respondent, a political subdivision of the State of California, is the successor in interest of the above trustees.

The pertinent provisions of the deed from Paul to the trustees are as follows: "[T]he said party of the first part for and in consideration of his desire for the advancement of educational interests in Mayfield aforesaid and for that purpose furnishing a site for a schoolhouse there. Has granted bargained and sold and by these presents does grant bargain and sell convey and confirm unto the said parties of the second part and to their successors in office as Trustees aforesaid all that certain piece parcel or lot of land situated in the town of Mayfield aforesaid and known and designated as Lot number 86 * * * [map reference follows]. Together with all and singular the tenements hereditaments and appurtenances hereunto belonging to be used as a public school for said District forever. To have and to hold unto the said parties of the second part their successors in office for the sole use and benefit of the said Mayfield School District. And whenever the said parties of the second part their successors in office or those legally representing the said Mayfield School District shall abandon the premises hereby conveyed for school purposes or shall fail neglect or refuse to use said premises for common school uses and purposes then and in that event the said premises shall revert to the said party of the first part his heirs and assigns to * * * their sole use and benefit forever." (Emphasis added.)

The school district erected a school on the land and continued to operate and maintain it there until 1940 when the building was demolished.

At this point we observe that eventually there were two groups of heirs of William Paul: Those claiming an undivided three-fourths interest in the land through Katherine McDougall; and those claiming the remaining individual one-fourth through Albert K. McDougall. The latter are the eight appellants herein.

In 1948 Katherine McDougall commenced in the court below action No. 70253 against the respondent herein seeking a decree quieting title to the parcel of land in question. She was largely successful, the court rendering judgment in her favor and against this respondent determining that she was the owner of an undivided three-fourths interest. No appeal was taken and the judgment is final. Indeed respondent conceded during the course of the instant proceedings in the trial court that the persons claiming through Katherine McDougall owned a three-fourths interest in the land.

In 1959 the County of Santa Clara commenced the proceedings in eminent domain from which the instant controversy derives. The three-fourths ownership of the Katherine McDougall claimants having been conceded, the court below conducted a preliminary trial of the single issue as to whether appellants or respondent school district had title to the remaining one-fourth interest. After such determination, the remaining issues of the cause were tried and resulted in an award of $126,958 in favor of those persons determined to be the owners.

The court, in separate findings on the preliminary issue, found and concluded in substance that the deed from William Paul contained only a covenant which was fully performed; that 'in the event the language of said deed is construed to creat a fee upon a condition subsequent' the defendants McDougall (appellants herein) waived their right of re-entry by failing to assert it at any time; that the deed did not create a determinable fee (referred to by the court as a conditional fee defeasible) in the school district and 'there was no automatic defeasance of Defendant District's title by reason of the removal of the Sherman School in 1940'; that the school district never abandoned the property for school purposes; that the judgment in 1950 in favor of Katherine McDougall and against the school district was not res judicata against the latter in these proceedings; that the defendants McDougall had no right or title to the land; and that the school district was the owner of an undivided one-fourth interest in fee simple absolute and entitled to one-fourth of any award made in the condemnation proceedings. In the ensuing order and judgment of condemnation, judgment was rendered accordingly. It is from such portion of the judgment that this appeal is taken.

Appellants' contentions on appeal are: (1) that the prior judgment in favor of Katherine McDougall is res judicata against the school district; (2) that, as a matter of law, the deed from William Paul created a fee simple determinable as a result of which an undivided one-fourth interest automatically reverted to appellants upon abandonment of the property by the school district; and (3) that the finding or conclusion against abandonment is without support in the evidence.

The gist of appellants' argument on the first point is that the same deed, the same land, the same proof and the same school district were involved in the Katherine McDougall litigation and that therefore the judgment of the court in said earlier action that the plaintiff therein, as successor in interest to William Paul, had title to a three-fourths interest should control in the instant proceedings as to the ownership of the remaining fourth. ¹ Appellants contend that the instant case is governed by the following rule stated in Bernhard v. Bank of America (1942), 19 Cal.2d 807, 813, 122 P.2d 892, 895: 'In determining the validity of a plea of res judicata three questions are pertinent: Was the issue decided in the prior adjudication identical with the one presented in the action in question? Was there a final judgment on the merits? Was the party against whom the plea is asserted a party or in privity with a party to the prior adjudication?' The trial court, on the contrary, concluded that the appellants and Katherine McDougall were at best cotenants ² and seems to have applied the rule that there being no privity among cotenants, generally a judgment in an action to determine title brought by or against one cotenant does not make res judicata matters decided therein in a subsequent action by or against other cotenants. (See Rest., Judgments, § 103; 29 Cal.Jur.2d, Judgments, § 276, pp. 250-251.)

The doctrine of res judicata has a double aspect. As the court stated in Todhunter v. Smith (1934), 219 Cal. 690, 695, 28 P.2d 916, 918 '[a] former judgment operates as a bar against a second action upon the same cause, but, in a later action upon a different claim or cause of action, it operates as an estoppel or conclusive adjudication as to which issues in the second action as were actually litigated and determined in the first action.' (See also Sutphin v. Speik (1940), 15 Cal.2d 195, 201, 99 P.2d 652, 101 P.2d 497; 3 Witkin, Cal.Procedure, p. 1927.) In its first aspect, res judicata is effective as a merger or bar; in the second as a collateral estoppel. While under either aspect, the doctrine is in the usual instance operative to make an existing final judgment conclusive of the rights of parties to the former action or of those persons in privity with such parties (Rest., Judgments, §§ 79, 83), the doctrine has been invoked as a collateral estoppel by persons who are strangers, that is neither parties nor privies, to the former action. (See 3 Witkin, Cal.Procedure, pp. 1955-1962.) It is this second aspect of the doctrine which was expanded in the Bernhard case. It is this aspect with which we are here concerned since obviously appellants' cause of action is different from that of Katherine McDougall in the earlier litigation.

In announcing the rule relied upon by appellants and set forth by us above, the court in Bernhard abrogated the requirement of mutuality in the assertion of the plea of res judicata, in other words, the necessity that the party claiming the estoppel would have been bound by the former judgment had it gone the other way. 'The requirements of due process of law forbid the assertion of a plea of res judicata against a party unless he was bound by the earlier litigation in which the matter was decided. [Citations.] He is bound by that litigation only if he has been a party thereto or in privity with a party thereto. * * * There is no compelling reason, however, for requiring that the party asserting the plea of res judicata must have been a party, or in privity with a party, to the earlier litigation.

'No satisfactory rationalization has been advanced for the requirement of mutuality. Just why a party who was not bound by a previous action should be precluded from asserting it as res judicata against a party who was bound by it is difficult to comprehend.' (Bernhard v. Bank of America, supra, 19 Cal.2d 807, at p. 812, 122 P.2d 892, at p. 894.) Accordingly, it was held in that case that the defendant bank was not precluded by lack of privity or of mutuality of estoppel from asserting against the plaintiff that the issue involved had been adjudicated by an...