Res judicata

Res judicata includes two related concepts: claim preclusion and issue preclusion (also called collateral estoppel or issue estoppel), though sometimes res judicata is used more narrowly to mean only claim preclusion.

Claim preclusion bars a suit from being brought again on an event which was the subject of a previous legal cause of action that has already been finally decided between the parties[4] or those in privity with a party.

Issue preclusion bars the relitigation of issues of fact or law that have already been necessarily determined by a judge or jury as part of an earlier case.

It is often difficult to determine which, if either, of these concepts apply to later lawsuits that are seemingly related, because many causes of action can apply to the same factual situation and vice versa. The scope of an earlier judgment is probably the most difficult question that judges must resolve in applying res judicata. Sometimes merely part of the action will be affected. For example, a single claim may be struck from a complaint, or a single factual issue may be removed from reconsideration in the new trial.

Res judicata is intended to strike a balance between competing interests. Its primary purpose is to assure an efficient judicial system. A related purpose is to create "repose" and finality.[5]

Justice Stewart explained the need for this legal precept as follows:

Federal courts have traditionally adhered to the related doctrines of res judicata (claim preclusion) and collateral estoppel (issue preclusion). Under RJ, a final judgment on the merits of an action precludes the parties . . . from re-litigating issues that were or could have been raised in that action. Under collateral estoppel, once a court has decided an issue of fact or law necessary to its judgment, that decision may preclude re-litigation of the issue in a suit on a different cause of action involving a party to the first cause. As this court and other courts have often recognised, res judicata and collateral estoppel relieve parties of the costs and vexation of multiple lawsuits, conserve judicial resources, and by preventing inconsistent decisions, encourage reliance on adjudication.[6]

Res judicata does not restrict the appeals process,[7] which is considered a linear extension of the same lawsuit as the suit travels up (and back down) the appellate court ladder. Appeals are considered the appropriate manner by which to challenge a judgment rather than trying to start a new trial. Once the appeals process is exhausted or waived, res judicata will apply even to a judgment that is contrary to law. In states that permit a judgment to be renewed, a lawsuit to renew the judgment would not be barred by res judicata, however in states that do not permit renewal by action (as opposed to renewal by scire facias or by motion), such an action would be rejected by the courts as vexatious.

There are limited exceptions to res judicata that allow a party to attack the validity of the original judgment, even outside of appeals. These exceptions—usually called collateral attacks—are typically based on procedural or jurisdictional issues, based not on the wisdom of the earlier court's decision but its authority or on the competence of the earlier court to issue that decision. A collateral attack is more likely to be available (and to succeed) in judicial systems with multiple jurisdictions, such as under federal governments, or when a domestic court is asked to enforce or recognise the judgment of a foreign court.

In addition, in matters involving due process, cases that appear to be res judicata may be re-litigated. An example would be the establishment of a right to counsel. People who have had liberty taken away (i.e., imprisoned) may be allowed to be re-tried with a counselor as a matter of fairness.

RJ may not apply in cases involving the England reservation. If a litigant files suit in federal court, and that court stays proceedings to allow a state court to consider the questions of state law, the litigant may inform the state court that he reserves any federal-law issues in the action for federal court. If he makes such a reservation, RJ would not bar him from returning the case to federal court at conclusion of action in state court.[8]

There is a declaratory judgment exception to RJ. "[A] declaratory action determines only what it actually decides and does not have a claim preclusive effect on other contentions that might have been advanced."[9] Therefore, “a plaintiff who has lost a declaratory judgment action may also bring a subsequent action for other relief, subject to the constraint of the determinations made in the declaratory action.”[9] This exception has been adopted in Oregon,[10] Texas,[11] and a number of other U.S. states.

RJ may be avoided if claimant was not afforded a full and fair opportunity to litigate the issue decided by a state court. He could file suit in a federal court to challenge the adequacy of the state's procedures. In that case the federal suit would be against the state and not against the defendant in the first suit.[2]

RJ may not apply if consent (or tacit agreement) is justification for splitting a claim. If plaintiff splits a claim in the course of a suit for special or justifiable reasons for doing so, a judgment in that action may not have the usual consequence of extinguishing the entire claim.

However, once a case has been appealed, finality of the appellate court's decision is vindicated in that proceeding by giving effect in later proceedings involving the same matter, whether in the appellate or lower courts. This is the law of the case doctrine.

When a subsequent court fails to apply res judicata and renders a contradictory verdict on the same claim or issue, if a third court is faced with the same case, it will likely apply a "last in time" rule, giving effect only to the later judgment, even though the result came out differently the second time. This situation is not unheard of, as it is typically the responsibility of the parties to the suit to bring the earlier case to the judge's attention, and the judge must decide how broadly to apply it, or whether to recognise it in the first place. See Americana Fabrics, Inc. v. L & L Textiles, Inc., 754 F.2d 1524, 1529-30 (9th Cir. 1985).