Res Judicata in Civil Procedure: Principles and Applications (Part 1 of 2)

Res Judicata – Claim and Issue Preclusion

Res judicata is a doctrine in civil procedure that prevents parties from re-litigating matters that have already been finally decided in previous judicial proceedings. It encompasses two primary sub-doctrines: claim preclusion and issue preclusion, also known as collateral estoppel.

Claim Preclusion

Claim preclusion bars the same parties—or those in legal privity—from bringing a subsequent lawsuit arising from the same transaction or occurrence after a final judgment on the merits. It requires three elements:

A final judgment on the merits by a court of competent jurisdiction.

Identity or privity of the parties in both suits.

Identity of claims, typically determined by the transactional test, which bars all claims arising from the same set of facts, even if not previously asserted.

Issue Preclusion

Issue preclusion prevents the re-litigation of specific factual or legal issues that:

Were actually litigated,

Were essential to the prior judgment,

Were determined in a valid and final judgment,

And were litigated by a party who had a full and fair opportunity to do so.

It may apply mutually or non-mutually:

Defensive non-mutual issue preclusion is when a new defendant prevents a plaintiff from re-litigating a previously lost issue.

Offensive non-mutual issue preclusion, permitted under Parklane Hosiery Co. v. Shore, allows a new plaintiff to use a prior issue determination against a defendant, subject to fairness considerations.

Key Cases

Federated Department Stores v. Moitie confirmed that even erroneous judgments have preclusive effect.

Semtek v. Lockheed Martin clarified that federal diversity judgments follow the preclusion law of the state where the court sits.

Montana v. United States and Allen v. McCurry illustrate the binding effect of issue preclusion on the government and in federal civil rights actions.

Taylor v. Sturgell reaffirmed that nonparties are generally not bound by prior judgments, with limited exceptions.

Exceptions and Limitations

Preclusion does not apply where:

The earlier judgment lacked jurisdiction or was not final.

The issue was not essential to the judgment.

There has been a significant change in law or fact.

Due process concerns exist (e.g., inadequate representation).

Policy and Criticism

The doctrine promotes judicial efficiency, prevents harassment through repetitive litigation, and ensures finality. However, rigid application can result in unfairness, especially for underrepresented or resource-limited parties. Critics advocate for more flexible standards and greater judicial discretion in applying preclusion doctrines.