Reardon v. Allen

• Decision Date: 02 July 1965
• Docket Number: Nos. L--25628--62,L--9416--63,s. L--25628--62
• Citation: 213 A.2d 26,88 N.J.Super. 560
• Parties: Rose REARDON, Dennis Reardon and Kathleen Reardon, Plaintiffs, v. James ALLEN, Defendant. Lee West CONYERS, Plaintiff, v. James ALLEN, Kathleen Reardon and Dennis Reardon, Defendants.
• Court: New Jersey Superior Court

Page 560

88 N.J.Super. 560

213 A.2d 26

Rose REARDON, Dennis Reardon and Kathleen Reardon, Plaintiffs, v. James ALLEN, Defendant.

Lee West CONYERS, Plaintiff, v. James ALLEN, Kathleen Reardon and Dennis Reardon, Defendants.

Nos. L--25628--62, L--9416--63.

Superior Court of New Jersey Law Division.

July 2, 1965.

Louis Chodash, Jersey City, for plaintiffs Reardon (Raymond G. Becker, attorney).

Peter R. Feehan, Englewood, for defendants Reardon in the action by Conyers (William V. Breslin, Englewood, attorney).

Joseph J. MacDonald, Hackensack, for defendant Allen (Hein, Smith & Mooney, Hackensack, attorneys).

BOTTER, J.S.C.

These consolidated actions were brought for personal injuries arising out of a collision between two automobiles, one owned by Dennis Reardon and one by James Allen. Previously, in a subrogation action, Reardon's insurance company had recovered a judgment against Allen for the damage to Reardon's automobile. This motion for summary judgment seeks to apply that judgment to the Reardon personal injury action to determine its outcome on the principles of Res judicata and collateral estoppel. Two issues are posed. Does the judgment in the property damage action preclude Allen from disputing liability in this action? Is Dennis Reardon barred from asserting a claim for medical expenses and loss of services, derived from his wife's injuries, because that claim was not asserted in the earlier action in which he was the named plaintiff?

The accident occurred on December 28, 1961 in Saddle Brook, New Jersey. Reardon's vehicle was driven by his daughter Kathleen; Reardon's wife, Rose, was a passenger. James Allen was driving his own vehicle, and Lee West Conyers was his passenger. The Reardons were residents of Bergen County; Allen and Conyers were residents of Passaic County.

Reardon carried collision insurance. After paying his claim, Reardon's insurance company, as assignee or subrogee, brought an action against Allen in the name of Dennis Reardon for the property damage. The action was commenced in the Passaic County District Court in May 1962. On January 9, 1963 the action was tried before the court without a jury, and a judgment was recovered against Allen in the sum of $657.09 plus costs. No appeal was taken from that judgment; in fact, it has been satisfied.

Thereafter these actions were commenced in the Superior Court by the Reardons and by Conyers, on July 31, 1963 and December 27, 1963, respectively, and were consolidated for trial. Rose and Kathleen Reardon sue Allen for personal injuries. Dennis Reardon sues Allen Per quod. The action brought by Conyers for his personal injuries is against Allen, Dennis Reardon and Kathleen Reardon.

The Reardons have moved for summary judgment to preclude Allen from contesting liability. This application also includes Dennis Reardon's motion to strike the defense in Allen's answer which asserts Res judicata as a bar to Reardon's derivative claim. Allen contends that Dennis Reardon cannot maintain his cause of action because as plaintiff in the first action Reardon did not plead all claims which he had arising out of the same occurrence. This issue will be dealt with first.

In Ochs v. Public Service Railway Co., 81 N.J.L. 661, 80 A. 495, 36 L.R.A., N.S., 240 (E. & A.1911), it was held that a person who has recovered in an action for property damage can thereafter maintain a separate action against the same defendant for personal injuries suffered in the same accident. The injury suffered is held to be the wrong, not defendant's negligence alone; therefore separate causes of action for personal injury and for property damage may arise from one act of negligence. In Ochs the court noted that our Legislature has provided different periods of limitations within which to bring an action for personal injuries (N.J.S. 2A:14--2, N.J.S.A.) and an action for property damage (N.J.S. 2A:14--1, N.J.S.A.) and in this circumstance found support for its holding.

In Esper v. Manhattan Transit Co., Inc., 112 N.J.L. 186, 188, 169 A. 823, 824 (Sup.Ct.1934), affirmed o.b. 115 N.J.L. 113, 178 A. 754 (E. & A.1935), the court accepts Ochs as an exception to the rule that 'a party who has suffered damages by reason of the wrong of another must present his entire claim in one action * * *.' However, the policy of avoiding multiple litigation by joining in one action all claims arising out of a single transaction strongly recommends that the result in Ochs should be repudiated. The question is not simply whether an act of negligence gives rise to one or two causes of action where both personal injuries and property damage occur. The question is, given two causes of action arising simultaneously in favor of one person against another, should the claimant be required to sue for both claims in the first action. Efficient judicial administration normally requires that 'all facets of a single dispute between parties be completely determined in one action.' Applestein v. United Board & Carton Corp., 35 N.J. 343, 356, 173 A.2d 225, 231 (1961); Falcone v. Middlesex County Medical Society, 87 N.J.Super. 486, 210 A.2d 78 (App.Div.1965); and see Kelleher v. Lozzi, 7 N.J. 17, 180 A.2d 196 (1951), holding that Kelleher was estopped from suing Lozzi for personal injuries and property damage when an earlier action brought by Lozzi against Kelleher was settled by payment to Lozzi, even though the assertion of Kelleher's claim by way of a counterclaim was permissive, not mandatory, under Rule 3:13--1 (now R.R. 4:13--1). Absent exceptional circumstances, a person who has a claim for property damage and personal injuries arising simultaneously should be required to join both claims in one action. This is the majority rule. Sibson v. Robert's Express, Inc., 104 N.H. 192, 182 A.2d 449 (Sup.Ct.1962); Mills v. De Wees, 141 W.Va. 782, 93 S.E.2d 484, 62 A.L.R.2d 965 (Sup.Ct.App.1956); Dearden v. Hey, 304 Mass. 659, 24 N.E.2d 644, 127 A.L.R. 1077 (Sup.Jud.Ct.1939); Annotations, 'Simultaneous injury to person and property as giving rise to single cause of action,' 62 A.L.R.2d 977 (1958); Annotation, 127 A.L.R. 1081 (1940); 1B Moore, Federal Practice (2d. ed. 1965), par. 0.410, p. 1168.

However, a different rule is justified where, as here, an insurance company has been subrogated to the property damage claim and has brought suit first. The insurance company has become the owner of the property damage claim, the true party in interest, and its own attorneys control the litigation. Although the property damage action was brought in the name of Dennis Reardon, he was merely a formal party, one without control over the action and without a proprietary or financial interest in its outcome (except, possibly, for a portion of the recovery based upon a deductible provision in the policy). Accordingly, in these circumstances Dennis Reardon will not be precluded from later suing on his own cause of action for losses due to his wife's injuries. Vasu v. Kohlers, Inc., 145 Ohio St. 321, 61 N.E.2d 707, 166 A.L.R. 855 (Sup.Ct.1945); American Insurance Co. v. Ellsworth Freight Lines, Inc., 113 Ohio App. 426, 178 N.E.2d 819 (Ct.App.1960); General Exchange Ins. Corp. v. Young, 357 Mo. 1099, 212 S.W.2d 396 (Sup.Ct.1948); Note, 'Developments in the Law--Res Judicata,' 65 Harv.L.Rev. 818, 829 (1952); see also Restatement, Judgments, sec. 81, p. 381, sec. 80(2), illustration #5, p. 369 (1942), and Annotation, 62 A.L.R.2d 997, supra, at pp. 989--995, collectingcases for and against this proposition. Similarly, the rule of Kelleher v. Lozzi, supra, does not apply to preclude an action by A against B where A's insurance carrier, not A himself, had previously paid B to settle B's claim against A. Our courts have held that in this circumstance an insured will not be prejudiced by his carrier's exercise of rights under the insurance policy. Klotz v. Lee, 36 N.J.Super. 6, 114 A.2d 746 (App.Div.1955); Isaacson v. Boswell, 18 N.J.Super. 95, 86 A.2d 695 (App.Div.1952); De Carlucci v. Brasley, 16 N.J.Super. 48, 83 A.2d 823 (Law Div.1951).

The second issue to be resolved is whether the Reardons may now use the judgment of the first action offensively against Allen to establish his liability, leaving only the question of damages to be tried. In the property damage subrogation action Allen's Negligence and the contributory negligence of Kathleen Reardon were in issue and were decided against Allen. Allen's insurance carrier furnished the defense in the property damage action and is also defending here. The Reardons contend that Allen has had his day in court and should be bound by the result.

The precise question posed has not been answered by any reported decision in this State. The search for an answer leads into a field of considerable controversy. The basic objective is judicial finality. Issues once determined should not be relitigated. Parties should not be vexed by repeated litigation. Public policy demands economy in the use of judicial machinery. Reliance, repose and respect for the judicial pronouncement ask that the final determination of an issue in one action will not be followed by a retrial and the threat of an inconsistent result in a later action. To fulfill these objectives final judgments of a court of competent jurisdiction are accorded a binding effect upon the parties and their privies not only as to the same cause of action (res judicata), but, in respect to a different cause of action in subsequent litigation, as to matters necessarily litigated and determined in the first action (collateral estoppel). Lubliner v. Bd. of Alcoholic Beverage Control, Paterson, 33 N.J. 428 435, 165 A.2d 163 (1960); McAndrew v. Mularchuk, 38 N.J. 156, 183 A.2d 741 (1962); Bango v. Ward, 12 N.J. 415, 97 A.2d 147 (1953); Hudson Transit Corp. v. Antonucci, 137 N.J.L. 704, 61 A.2d 180, 4 A.L.R.2d 1374 (E. & A.1948); Esper v. Manhattan Transit Co., Inc., supra; In re Walsh's Estate, 80 N.J.Eq. 565, 74 A. 563 (E. & A.190...