Waitkus v. Pomeroy, 71--321

• Decision Date: 31 October 1972
• Docket Number: No. 71--321,71--321
• Citation: 31 Colo.App. 396,506 P.2d 392
• Parties: Alan J. WAITKUS, Plaintiff-Appellant, v. William A. Cleveland POMEROY et al., Defendants-Appellees. . I
• Court: Colorado Court of Appeals

Page 392

506 P.2d 392

31 Colo.App. 396

Alan J. WAITKUS, Plaintiff-Appellant, v. William A. Cleveland POMEROY et al., Defendants-Appellees.

No. 71--321.

Colorado Court of Appeals, Div. I.

Oct. 31, 1972.

Rehearing Denied Dec. 12, 1972.

Certiorari Granted Feb. 26, 1973.

Martin, Knapple & Johnson, James G. Martin, Helen P. Garfield, Boulder, for plaintiff-appellant.

Yegge, Hall & Evans, Wesley H. Doan, Denver, for defendant-appellee, William A. Cleveland Pomeroy.

SMITH, Judge.

While driving a sports car with Stephen Zeiler and Alan J. Waitkus as passengers, William A. Cleveland Pomeroy attempted to overtake an automobile being driven at a high speed by one Jan Kevin Vesey. Pomeroy lost control of his car which went into a broadside skid and smashed into a tree. Zeiler and Waitkus were both injured in the accident. Zeiler brought an action against Pomeroy, the driver of the car in which he had been riding, and against Vesey, the driver of the car Pomeroy was pursuing. Zeiler alleged that both Pomeroy's gross negligence and Vesey's negligence were the proximate cause of his injuries. At the conclusion of plaintiff's evidence, the trial court directed a verdict in Vesey's favor. The jury subsequently awarded Zeiler a $5000 judgment against Pomeroy. The result in that case was affirmed by this court. Pomeroy v. Zeiler, Colo.App., 473 P.2d 988.

Waitkus, the other passenger in the car driven by Pomeroy, initiated the present action against Pomeroy, Vesey, and Vesey's father, asserting the same basis for recovery as did Zeiler in his earlier action. Waitkus moved for summary judgment against Pomeroy on the issue of liability, asserting that the doctrine of res judicata prevented defendant Pomeroy from denying and thus relitigating that issue. The court granted plaintiff's motion for summary judgment.

Defendants Vesey thereafter moved for summary judgment on the basis that the same doctrine should prevent the plaintiff Waitkus from asserting against them the identical issues that had been determined in Vesey's favor in Pomeroy v. Zeiler, Supra. Defendants Vesey argued that the theory upon which the court granted plaintiff a summary judgment on the issue of defendant Pomeroy's liability should apply with equal force to their motion for summary judgment. Accordingly, the court granted defendants Veseys' motion for summary judgment and dismissed them from the case. Trial to a jury, solely on the issue of damages, resulted in an award in favor of plaintiff and against defendant Pomeroy in the amount of $100,000.

Defendant Pomeroy filed a motion for new trial on the ground that the court erred in granting both motions for summary judgment. Defendant Pomeroy argued that the court erred in ruling that the result in the previous action, Pomeroy v. Zeiler, Supra, could be asserted as collateral estoppel in the present case. Pomeroy also asserted, as additional grounds for new trial, that the trial court erred in failing to excuse a juror for cause and that the verdict was grossly excessive.

In its minute order, the court ruled as follows concerning the motion for new trial:

'Motion for new trial is now granted in its entirety. All parties are put back in the same position they were in at the beginning of the trial.'

The trial judge then disqualified himself from the case, which was reassigned to another judge.

Plaintiff again moved the court for summary judgment against defendant Pomeroy on the issue of liability. The grounds for the motion were precisely the same as in plaintiff's previous motion for summary judgment. Similarly, defendants Vesey again moved for summary judgment against plaintiff Waitkus on the same grounds as they had previously. This time the court denied both motions and a second trial to a jury on all issues resulted in a verdict for the plaintiff and against the defendant Pomeroy and defendants Vesey jointly for damages in the amount of $33,000.34.

Plaintiff thereafter moved the court for an order altering and amending the judgment entered on the second verdict. Plaintiff complained that the judgment entered after the second trial was in error and argued that the earlier verdict in the sum of $100,000 should be reinstated against defendant Pomeroy, and that judgment on the second verdict, in the amount of $33,000.34, should be entered against defendants Vesey only. The motion to amend or alter the judgment was denied, and from the judgment entered on the second verdict, plaintiff appeals. We reverse and remand.

I.

The determination of this appeal turns upon the applicability of res judicata asserted as collateral estoppel. Collateral estoppel may be applied when, in a subsequent action, an issue litigated and determined in an earlier case is asserted by or against a party in the second action who was a party, or in privity with, a party to the action. In Murphy v. Northern Colorado Grain Co., 30 Colo.App. 21, 488 P.2d 103, this court approved the use of res judicata as collateral estoppel and accepted the reasoning in Bernhard v. Bank of America National Trust & Savings Association, 19 Cal.2d 807, 122 P.2d 892. In Bernhard, Mr. Justice Traynor, confronting the question of the applicability of res judicata as a basis for applying the collateral estoppel doctrine, identified three tests as being determinative of the issue:

'(1) Was the issue decided in the prior adjudication identical with the one presented in the action in question? (2) Was there a final judgment on the merits? (3) Was the party against whom the plea is asserted a party or in privity with a party to the prior adjudication?'

In a subsequent opinion, he recognized the necessity of a fourth test. Was the issue in the first case competently, fully, and fairly litigated? Teitelbaum Furs, Inc. v. Dominion Insurance Co., 58 Cal.2d 601, 25 Cal.Rptr. 559, 375 P.2d 439. In that case, inquiry was made into the facts surrounding the former judgment to determine the fairness of allowing collateral estoppel in the subsequent action.

We conclude that the burden is upon the party asserting res judicata as collateral estoppel to prove that these four tests are met, and the trial court must consider and rule upon these tests in determining the propriety of applying the doctrine.

II.

We first consider whether plaintiff was initially entitled to summary judgment against Pomeroy on the issue of liability. Plaintiff argues that the doctrine of collateral estoppel compels us to prevent the relitigation of defendants' liability in the present case. Defendant contends that the doctrine if applied here would not be asserted defensively, as in Murphy, supra, but offensively and thus should not be allowed.

' Defensive use' of collateral estoppel occurs when a stranger to a former judgment relies upon that judgment to release himself from the need to defend an issue which the opponent has had previously determined against him. 'Offensive use' occurs when a stranger to a judgment relies upon a former judgment to which his opponent was a party to conclusively establish in his favor an issue which he otherwise would be required to prove as an element of his case. Defendant points out that the California courts are not agreed as to whether Bernhard, supra, which involved a defensive use of collateral estoppel, is precedent for allowing an offensive use of collateral estoppel. Compare Hardware Mutual Insurance Co. v. Valentine, 119 Cal.App.2d 125, 259 P.2d 70, with Nevarov v. Caldwell, 161 Cal.App.2d 762, 327 P.2d 111.

An examination of the cases has convinced us that there is little real distinction between offensive and defensive use of the doctrine of collateral estoppel. The courts which have addressed themselves to this point have seemed to indicate that when the doctrine is asserted defensively or as a shield, there is less likelihood of an unfair result being achieved than when the doctrine is asserted offensively, as a sword. Adamson v. Hill, 202 Kan. 482, 449 P.2d 536. Assuming that the tests set forth in Bernhard, supra, have been met, the decision to apply the doctrine, in the final analysis, must rest upon a determination by the trial court of the fairness of the judgment sought to be applied, and not upon the purpose for which it is asserted. See Currie, Civil Procedure: The Tempest Brews, 53 Cal.L.Rev. 25. The fairness test involves an inquiry concerning the opportunity of the party sought to be bound to fully and fairly litigate the issue in the previous case and of the fairness of the result in that proceeding. Compare Zdanok v. Glidden Co., 327 F.2d 944 (2d Cir.), cert. denied, 377 U.S. 934, 84 S.Ct. 1338, 12 L.Ed.2d 298, with Berner v. British Commonwealth Pacific Airlines, Ltd., 346 F.2d 532 (2d Cir.), cert. denied, 382 U.S. 983, 86 S.Ct. 559, 15 L.Ed.2d 472. We conclude that creation of an arbitrary rule of application, based upon whether the doctrine is asserted offensively or defensively, would ignore the overriding consideration of the law for justice and fair play which gives rise to the doctrine of collateral estoppel in the first instance.

In the present case, the issue as between Pomeroy and his passenger decided in the prior adjudication, is identical with the one presented in the present action. There was a final judgment on the merits, affirmed by this court. Pomeroy, against whom the plea is asserted, was a party in the prior adjudication. Pomeroy has not complained of the fairness or fullness of opportunity to litigate in the previous proceedings, and, upon Waitkus' showing, the trial court found that there was no such deprivation or lack of fairness. Therefore, we determine that the trial court did not err in determining that the requisite tests had been met and in initially granting plaintiff's motion for summary judgment on the issue of liability against Pomeroy.

III.

In light of the fact that Vesey was exculpated in the same proceedings which we have allowed to be asserted against the defendant Pomeroy...