Swan v. Sargent Industries, 53805

• Decision Date: 19 August 1980
• Docket Number: No. 1,No. 53805,53805,1
• Citation: 620 P.2d 473
• Parties: 1980 OK CIV APP 49 Virginia SWAN d/b/a Ball Trucking Co., Appellant, v. SARGENT INDUSTRIES, a foreign corporation, Appellee
• Court: United States State Court of Criminal Appeals of Oklahoma. Court of Civil Appeals of Oklahoma

Page 473

620 P.2d 473

1980 OK CIV APP 49

Virginia SWAN d/b/a Ball Trucking Co., Appellant, v. SARGENT INDUSTRIES, a foreign corporation, Appellee.

No. 53805.

Court of Appeals of Oklahoma, Division No. 1.

Aug. 19, 1980.

Rehearing Denied Sept. 30, 1980.

Certiorari Denied Nov. 7, 1980.

Approved for Publication by Supreme Court Nov. 10, 1980.

Released for Publication by Order of Court of Appeals Nov. 13, 1980.

Bourk & Gardenhire by Gary W. Gardenhire, Oklahoma City, for appellant.

Crowe, Dunlevy, Thweatt, Swinford, Johnson & Burdick by Jim K. Goodman and Judy G. Hamilton, Oklahoma City, for appellee.

ROMANG, Judge:

This Plaintiff-Appellant sued this Defendant-Appellee on the same cause of action in 1976. The action was dismissed for lack of personal jurisdiction over the Defendant, a foreign corporation, who had filed a special appearance. On the filing of the present action the Defendant specially appeared pleading the earlier order as res judicata and again urging that the Oklahoma courts lack jurisdiction over this breach of warranty action under the U.C.C. The District Court ruled it had jurisdiction originally but that its earlier decision barred review of the personal jurisdictional issue. Plaintiff appeals arguing there is personal jurisdiction and that collateral review is not precluded by the prior determination. The issues are well briefed and the answer, surprisingly, not as simple as might be thought.

We will address the issue of collateral estoppel first since if relitigation is foreclosed our opinion on the jurisdictional issue is moot.

The Restatement of the Law of Judgments § 9 states:

"Where a defendant appears in an action to object that the court has no jurisdiction over him and the court overrules the objection and judgment is rendered against him, the parties are precluded from collaterally attacking the judgment on the ground that the court had no jurisdiction over the defendant."

Oklahoma cases clearly reflect this view. See one of the latest statements in State v. Corporation Comm'n, Okl., 590 P.2d 674 (1979). See also James, Civil Procedure, at 536 (1965), and Vestal, Res Judicata/Preclusion, at V-258 (1969).

We have extensively reviewed the Oklahoma cases (some discussed infra ) and the development of the rule otherwise. It is interesting to note that virtually all the cases reviewed deal with the normal situation addressed in the Restatement of Judgments, supra, where the court in the first action finds it has jurisdiction over the defendant and he is precluded from collaterally attacking jurisdiction. Another series of cases deal with the court's determination of subject matter jurisdiction. It is, of course, the law that a special appearance to challenge the court's personal jurisdiction is a submission to the jurisdiction of the court for purposes of determining jurisdiction, and any error in that determination can only be directly attacked by way of appeal or an application for a writ of prohibition.

Most of the foreign precedents deal with general common law of the federal courts, see e. g. Baldwin v. Iowa State Traveling Men's Ass'n, 283 U.S. 522, 51 S.Ct. 517, 75 L.Ed. 1244 (1932), or federal full faith and credit issues. Since 28 U.S.C. § 1738 provides essentially that the judgment of a court of one state has the same effect everywhere as it has where rendered, the critical issue in those cases is what effect the judgment had where issued. See Restatement of the Laws, Conflict of Laws (Second) § 96. The Baldwin case, while cited with approval in Consolidated Motor Terminal v. Vineyard, 193 Okl. 388, 143 P.2d 610, 614 (1943), is persuasive only. And since we deal with the effect of an Oklahoma order of dismissal, in Oklahoma the full faith and credit cases are inapposite.

Put plainly, our issue is whether a court's prior order of dismissal for lack of personal jurisdiction after the defendant's special appearance precludes relitigation of that issue in subsequent proceedings based on the same jurisdictional facts. ¹ Plaintiff argues that two Oklahoma cases stand for the proposition that relitigation after dismissal for lack of jurisdiction is permitted. Lowden v. Hooper, 188 Okl. 595, 112 P.2d 172 (1941), and Gottsch v. Ireland, Okl., 358 P.2d 1097 (1961). The Defendant counters with Fitzsimmons v. City of Oklahoma City, 192 Okl. 248, 135 P.2d 340 (1943); Flick v. Crouch, Okl., 434 P.2d 256 (1967); and Hines v. Superior Court, Okl., 435 P.2d 149 (1967), which generally endorse the broad concept of issue preclusion on jurisdictional issues and the latter two of which cite Plaintiff's cases in support of this broad rule. It is noteworthy that all these cases dealt with some form of subject matter jurisdiction. While our cases do not draw, and have not had occasion to draw, a distinction between personal and subject matter jurisdiction for current purposes, we note the Restatement of Judgments § 10 adopts a policy balancing the policies behind finality of litigation against the policies limiting a court's subject matter jurisdiction. We now turn to a consideration of the primary cases.

Plaintiff's reliance on Lowden v. Hooper, supra, is misplaced. Lowden dealt with a taxpayer challenge to a city annexation order. The primary holding was that the actions of the taxpayer estopped it from questioning the ordinances. The Court did refer to the City's contention that the dismissal for want of jurisdiction of three prior actions in which the legality of annexation was an issue was not res judicata. But the context clearly indicates that the issue sought to be precluded was the unlitigated one of annexation and not the issue of jurisdiction.

In Fitzsimmons v. City of Oklahoma City, supra, the Supreme Court stated that the

"... adjudication of the jurisdictional facts in a domestic judgment by a court having jurisdiction of the general subject matter is conclusive in a collateral proceeding attacking such judgment by attempting to again put such facts in issue." 135 P.2d at 342.

But the issue there concerned the effect of a prior judgment based on a statute subsequently ruled unconstitutional. In context the broad language is limited by the facts before the court. Additionally, the present jurisdictional issue seeks reassessment as to whether the facts justify the assertion of personal jurisdiction.

The next case chronologically is Gottsch v. Ireland, supra. It is the interpretation of this case which ultimately decides the case on review. In Gottsch the plaintiffs in the prior action sought partition and determination of heirs and the action was dismissed because the District Court determined it lacked "jurisdiction to decree partition and determine the interests of the owners of the property at that time." 358 P.2d at 1100. This was apparently due to the District Court's view that under 84 O.S. § 257, as it then read, vested exclusive jurisdiction in the County Court as a probate court for a period of time. Three months later the second action was filed in the same District Court. The Supreme Court agreed with the Plaintiffs that "(a) dismissal for want of jurisdiction will not prevent a new suit on the same cause of action." Citing, inter alia, 17 Am.Jur. Dismissal § 96 now 46 Am.Jur.2d Judgments § 500 and Lowden v. Hooper, supra, 358 P.2d at 1100-1101.

In Flick v. Crouch, supra, the Supreme Court cited Gottsch and Lowden, inter alia, for the proposition that

"(a) dismissal of an action on the sole ground that the court is without jurisdiction of the subject-matter (sic) of the suit is ordinarily regarded as a conclusive determination only of the fact that the court lacks jurisdiction. It does not generally operate as an adjudication of the 'merits' and will not bar relitigation of the same cause or of any question material to its merits." (Emphasis original.) 434 P.2d at 261.

The issue in Flick concerned a trial court's dismissal of an action because jurisdiction belonged exclusively to the State Industrial Court. We agree with Plaintiff that the Court's reference cited above is technically dicta. As a studied statement of the meaning of Gottsch, however, it cannot be said to be totally irrelevant.

A similar discussion citing Gottsch and Lowden occurred in Hines v. Superior Court, supra. Indeed, the language from Flick quoted above is...