Issue Preclusion – class one

1. Issue Preclusion – class one April 9

2. Review of Claim Preclusion • Claim preclusion bars plaintiff from re-litigating both claims she brought and claims she COULD have brought in the first lawsuit. • It is designed to prevent vexatious litigation and promote judicial efficiency.

3. Elements of Claim Preclusion • Claim preclusion applies if the second suit involves: • Same parties or privies* (*subst’l control or virtual representation) AND • Same claim (maj: same t/a or occur; min: same rights/duties) AND • If there was a final judgment on the merits in the first case

4. Review hypos • Plaintiff is in a car wreck. At the time of trial, she is only suffering from a minor back injury and the jury awards her $15,000. Two years after trial, she discovers that she has a permanent disabling injury from the wreck. May she file another suit seeking more compensation?

5. hypo • A and B are in a car wreck. C is a passenger in A’s car. In suit 1, C sues A&B and gets $20,000 for her personal injuries. She believes that the verdict was wrong - that she had at least $50K in damages. May she bring a second suit against A&B for the additional damages?

6. hypo • A and B are in a car wreck. In suit 1 - A files a claim for property damage to her car. Gets $5,000. In suit 2, A files a claim for her personal injuries. B seeks to have suit 2 dismissed on grounds of Claim Preclusion - what result ? • What if property damage case was filed in small claims court which couldn’t hear personal injury claim b/c of jurisdictional amount limit - is personal injury claim barred?

7. Hypo • A is injured as a result of B’s negligence. If A was B’s employee at time of injury, her only remedy is worker’s compensation. If she was not an employee, then she has a common law action for negligence. A files a claim with the worker’s comp commission and loses b/c the commission finds A was not an employee. A now sues in civil state court for negligence. B argues claim preclusion - A can’t file this second suit because A already filed suit before the worker’s comp commission (and lost her claim). How should the court rule?

8. Hypo • A and B have installment contract (i.e. . 0n June 1, 2008 - $5000 due; July 1, $5000 due, etc.) A files suit for breach of the installment contract on June 2, 2008. She wins her claim on Dec. 15, 2008. On January 3, 2009, she files suit for the installments due from July through December. B seeks summary judgment on the ground of claim preclusion. What result?

9. Contracts and claim preclusion • A single contract may give rise to serial breaches but courts hold that the claim is all amounts owed on the contract at the time suit is filed. However, breaches of separate contracts, even if separate contracts are with the same person, are treated as separate claims.

10. Hypo • A passenger is leaving a bus and falls b/c of a defective step. The bus driver, without looking to see if passengers had gotten off safely, starts driving and runs over plaintiff (who is lying on ground b/c of falling from the bad step). Suit 1 - passenger v. bus driver and bus company (respondeat superior) b/c of driver’s negligence in running her over. She loses. Suit 2 - passenger v. bus company b/c of improper maintenance of the bus steps. Is suit 2 precluded? (Go through the entire analysis and make arguments on both sides)

11. Time/space/origin/motivation; convenient trial package; expectations of parties • Same t/a for def • Not same t/a for p • Same rights/duties for def • Not same rights/duties for p

12. hypo • Trustee sues bank for unlawful conversion of the trust funds. Bank wins. The beneficiary of the trust, Jack, later brings suit against the bank for unlawful conversion of the trust funds. Bank moves for summary judgment based upon claim preclusion - is Jack bound by the earlier judgment?

13. Questions??? • Any questions on Claim Preclusion?

14. Due Process • Remember that w/both claim and issue preclusion, the court runs the risk of depriving someone of their due process right to have an “opportunity to be heard”. This concern underlies the interpretation of the rules.

15. Issue Preclusion • IF: • 1. the same issue of law or fact was actually litigated & • 2. was determined by valid final judgment, & • 3. the determination of that issue was essential to the judgment • the determination of that issue is conclusive in a subsequent action btwn the parties* whether on the same or a different claim • * In the next class, we will discuss whether it is binding when the action is btwn different parties

16. Background Info – Two kinds of verdicts • General verdict: Do you believe by plaintiff has proved by greater weight of evidence that def was negligent and that his negligence was a cause of her injuries? • Special verdict: Do you find that defendant ran the red light? Do you find that the defendant running the red light was a proximate cause of plaintiff’s damages?

17. Issue Preclusion – Thorny issues • The big questions in issue preclusion usually are whether the same issue was actually litigated & determined in the earlier suit and, if so, was it essential to the judgment

18. Hoult v. Hoult • Suit 1 - what was it about ? [who wins] • Suit 2 – what was it about?

19. Hoult v. Hoult • What is a defense to defamation? • If it was true her dad had raped her, could he prevail in his lawsuit?

20. Hoult v. Hoult • What is the issue that Jennifer is saying is precluded from re-litigation in suit 2? • [NOTE: When have an issue preclusion problem- make sure you clearly ID the issue that a party wants precluded!!!!] • Why does the dad say that issue should not be precluded from litigation in suit 2? What is the daughter’s argument?

21. Hoult v. Hoult • In suit 1 did the jury every explicitly find she was raped? • If there was a possibility that the jury could have found for her on other grounds, even if more likely than not they found that she was raped, could Jennifer get issue preclusion in suit 2 on the issue of whether her dad had raped her?

22. Hoult v. Hoult • How do you figure out the basis of the jury’s decision when there was no special verdict or they were not specifically asked the question in issue? • How did Judge Boudin go about reconstructing what the jury had decided in reaching its verdict? What role did the finding on the statute of limitations defense play in the Judge’s decision?

23. Jarosz v. Palmer • What was suit one about? • What is suit two about? • What is the issue that the defendant seeks to have precluded from litigation in suit two?

24. Jarosz • In suit one, was issue of whether P was J’s attorney actually litigated? • What is the test for whether something is “actually litigated” for issue preclusion purposes?

25. Jarosz • Next issue: essential to the judgment. • How does the court determine if an issue was “essential to the judgment”?

26. Query • Why do we care if an issue is essential to the judgment (v. incidental or immaterial to earlier judgment)?

27. Alternative grounds • What happens if a judgment is based on alternative grounds – are both grounds precluded; are neither precluded? [e.g. in case one, plaintiff loses b/c jury found both def was not negli b/c it had no notice the banana peel was on the floor & p was contrib b/c he should have seen the peel]. Using this example – define alternative grounds. • When have alternative grounds for judgment, are both findings precluded in suit 2; are neither precluded? What should the rule be?

28. Split in JurisdictionsOne view: • First Restatement: when there are alternate determinations in a case, either of which standing alone would support the judgment, both issues are precluded b/c both were essential to the judgment.

29. Another view • Second Restatement: when there are alternative determinations, neither determination is precluded b/c if there are alternative bases for the determination, then neither may have been as carefully looked at as if it were the only determination; and the losing party may be dissuaded from appealing b/c of the likelihood that at least one of the determinations might be upheld:

30. Query • In Jarosz , the court discusses evidentiary burdens of proof, how does this come into play in issue preclusion scenarios?(see next hypo slides)

31. Brain twister • OJ Simpson was indicted for murder of his wife, Nicole. After a long criminal trial, the jury found OJ not guilty of murdering Nicole. After that decision, Nicole’s family brought a civil suit for wrongful death against OJ. Could OJ claim that the civil suit should be dismissed based on issue preclusion (i.e. that the issue of whether he killed Nicole has already been litigated & determined)? • [For now put aside the “same parties problem]

32. OJ cont’d • What if the jury in the criminal case had found OJ was guilty of murdering Nicole. Now Nicole’s family wants to get the court in the civil wrongful death case to declare that OJ is precluded from arguing he didn’t kill Nicole. Would this be ok? [assume this is a juris which allows issue preclusion when you don’t have identical parties in suit one & two]