Myers v. Olson
| Decision Date | 13 January 1984 |
| Docket Number | No. 14800,14800 |
| Citation | 100 N.M. 745,676 P.2d 822,1984 NMSC 15 |
| Parties | W.G. MYERS, Plaintiff-Appellant, v. Lois R. OLSON, Carol Frances Murphy, Clifford Olson, and The Estate of Pauline French Myers, Deceased, Defendants-Appellees. |
| Court | New Mexico Supreme Court |
After a dissolution proceeding in which the property rights of the parties were determined, plaintiff W.G. Myers (Myers) sought an equitable lien on the separate property residence of his former wife, Pauline Myers. Defendants Lois and Clifford Olson (Olsons) and Carol Murphy (Murphy) moved for summary judgment. Judge Traub of the Bernalillo County District Court granted the motion on the grounds that the status of the property and any liens thereon had been resolved in the prior dissolution proceeding. We affirm.
The marriage of plaintiff and decedent was dissolved by a stipulated final decree which issued on August 11, 1981. The decree among other things distributed the property of the parties and in particular set over to Pauline Myers as her sole and separate property the lot and residence in question located in Albuquerque. The next day, she deeded the residence to her daughters, Lois Olson and Carol Murphy. Pauline Myers died on October 5, 1981. On March 19, 1982 plaintiff, represented by the same counsel as represented him throughout the dissolution proceedings, brought the instant equitable lien action.
At the district court level plaintiff initially claimed that decedent had promised him a home for his lifetime in the residence. Plaintiff alleged that, relying on the asserted promise, he had performed work on decedent's separate property residence, thereby enhancing its value and giving rise to an equitable lien. Both the alleged promise and the improvements occurred prior to the dissolution. Myers also asserted that by virtue of the deed, the Olsons and Murphy had improperly received the residence in which he claimed an equitable interest. On appeal Myers emphasizes the Olsons and Murphy would be unjustly enriched if an equitable lien is not imposed. Defendants assert the prior dissolution action is res judicata as to plaintiff's equitable lien action regardless of the theory upon which the latter is premised.
Myers argues a number of points which relate to the propriety of the summary judgment. Essentially, he asserts that undetermined issues of fact regarding the amount of the equitable lien preclude any summary judgment. However, we need not reach these contentions. The ultimate issue upon which this case turns is whether the prior stipulated final decree which determined the property interests of the parties is res judicata as to plaintiff's subsequent equitable lien claim. We hold that res judicata applies and that summary judgment was therefore proper.
The rules governing our interpretation of the instant stipulated final decree are well settled. Parks v. Parks, 91 N.M. 369, 372, 574 P.2d 588, 591 (1978); see United States v. Armour & Co., 402 U.S. 673, 91 S.Ct. 1752, 29 L.Ed.2d 256 (1971). Under Parks, a final decree of dissolution of marriage is deemed a final judgment. The only means of modifying or setting aside the judgment would be by appeal or by timely motion for relief under NMSA 1978, Civ.P.Rule 60(b) (Repl.Pamp.1980). Parks, 91 N.M. at 371, 574 P.2d at 590; Wehrle v. Robison, 92 N.M. 485, 590 P.2d 633 (1979). Neither was done by Myers. The validity of the decree was never challenged, its terms never modified.
We look to the terms of the decree to determine its coverage under Parks. It specifically provides that the parties entered in to all stipulations upon advice of their respective counsel and further states that the parties "agreed to the dissolution of their marriage and the disposition of their community and separate property and indebtedness." The decree then addresses jurisdictional matters, the grounds for dissolution and the fact that no children issued from the marriage. It then states that all other issues "have been disposed of by the parties by oral stipulation made subject to the approval of the Court and such stipulation appearing fair and equitable in all respects, the same is hereby approved."
The decree speaks in clear and unambiguous terms. It awards plaintiff Myers certain money market certificates and savings and loan account balances as his separate property as well as over seventy five (75) items of personal property located in the residence in question. The residence is unequivocally "reaffirmed as the separate property" of the decedent and "set over unto her as such." Conspicuous by its absence is any reference to an equitable lien or similar interest which plaintiff now claims. A fair reading of the document then is that the residence was to be the sole and separate property of the decedent, not subject to any equitable lien. The unambiguous and unqualified language of the decree forecloses any possibility of an exception involving an equitable lien claim. See Wehrle, 92 N.M. at 487, 590 P.2d at 635.
Under the doctrine of res judicata, a prior judgment on the merits bars a subsequent suit involving the same parties or privies based on the same cause of action. Res judicata will ordinarily preclude a claim where there has been a full and fair opportunity to litigate all issues arising out of that claim. Montana v. United States, 440 U.S. 147, 153-154, 99 S.Ct. 970, 973-974, 59 L.Ed.2d 210 (1979); see Parklane Hosiery v. Shore, 439 U.S. 322, 327-328, 99 S.Ct. 645, 649-650, 58 L.Ed.2d 552 (1979); Blonder-Tongue Laboratories v. University of Illinois Foundation, 402 U.S. 313, 328-329, 91 S.Ct. 1434, 1442-1443, 28 L.Ed.2d 788 (1979); Zdanok v. Glidden Co., 327 F.2d 944, 953 (2nd Cir.1964). The rationale for the application of res judicata generally is to protect individuals from the burden of litigating multiple lawsuits, to promote judicial economy, and to promote the policy favoring reliance on final judgments by minimizing the possibility of inconsistent decisions. Montana v. United States, 440 U.S. at 153-154, 99 S.Ct. at 973-974.
Defendants' maintain that the requisite elements for the application of res judicata are present. The second suit must be identical with the prior action in four respects: 1) the parties must be the same or in privity; 2) the subject matter must be identical; 3) the capacity or character of persons for or against whom the claim is made must be the same; and 4) the same cause of action must be involved in both suits. Three Rivers Land Co., v. Maddoux, 98 N.M. 690, 652 P.2d 240 (1982); Torres v. Village of Capitan, 92 N.M. 64, 582 P.2d 1277 (1978); City of Santa Fe v. Velarde, 90 N.M. 444, 564 P.2d 1326 (1977); see First State Bank v. Muzio et ux., 100 N.M. 98, 666 P.2d 777 (1983).
In this case, all four elements are met. Initially, the record indicates that Lois Olson and Frances Murphy were the grantees of the property in question under a warranty deed executed by the decedent during her lifetime. Grantees are in clear privity with their grantors and are entitled to a judgment entered in the grantor's favor if the judgment was prior to the conveyance of the property. Gilman v. Osborn, 78 N.M. 498, 433 P.2d 83 (1967). The warranty deed was not executed until the day after the issuance of the final decree. As to the presence of Clifford Olson and decedent's estate as defendants, there is some question as to whether they are proper parties to the suit. Regardless of their status as proper parties, we fail to see how these defendants would not be in privity with decedent since all claims to the residence would arise by virtue of the deed from decedent.
Secondly, the issue in the instant action is whether and to what extent an equitable lien exists. This subject matter was inextricably involved in the prior dissolution proceeding as evidenced by the decree which expressly effects a complete equitable division of property (including the residence) approved by the district court. Thirdly, the capacity or character of the persons involved, insofar as claims of ownership or interest in the residence is concerned, is the same in the instant action as in the prior dissolution proceeding.
The question concerning the identity of the causes of action is resolved by reference to Three Rivers Land Co. v. Maddoux and the Restatement (Second) of Judgments (1980). In Three Rivers this Court considered the composition of a cause of action for purposes of applying res judicata. The Restatement rules set forth in Sections 24 and 25...
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