Short Essay Question from the 2010 CivPro Exam

Short Essay Question 1. 

P, D, and X – each driving his own car – got into a car accident in Connecticut. P sued D for negligence under Connecticut law in Connecticut state court. P lost – although the jury found that P was not contributorily negligent, it also found that D was not negligent. Although X was aware of the lawsuit and could have intervened, he chose not to. After P v. D came to a judgment, X then sued P and D for negligence under Connecticut law in federal court in Connecticut in connection with the same accident. (The source of federal subject matter was diversity.) Both P and D argued that X was claim precluded from suing concerning the accident or, if he was not claim precluded, that he was issued precluded from relitigating whether  P and D were negligent. In one brief paragraph – how should the federal court decide and why? Also in one brief paragraph – was X a necessary party in the suit between P and D and why or why not? 

ANSWER

The following (in italics) would have been an ideal answer: 

The relevant claim and issue preclusion law here is Connecticut's, but from what we know about the basics of claim and issue preclusion, the following is true: X is not claim precluded because he was not a party and not in privity with a party in the earlier action. X  cannot be issue precluded for the same reason. Although there is a cutting edge doctrine of allowing issue preclusion against those who were not parties if they could have intervened, this occurs only when the absence of issue preclusion would submit someone who was a party in the earlier action to the possibility of double, multiple, or otherwise inconsistent obligations, which is not the case here. 

The relevant law of necessary parties here is Connecticut's. But assuming that Connecticut law is that same as Fed. R. Civ. P. 19, X was not a necessary party in P v. D. First of all, the presence of X is not necessary for P to get relief from D. D can pay P damages without X's presence in the suit. Second, although X arguably claims an interest relating to P v. D (since he was also in the accident), there is no reason to think that X cannot protect that interest by bringing a separate lawsuit. After all, he will not be bound by the outcome in P v. D. Furthermore there is no chance that allowing P v. D to proceed in X's absence would submit P or D to double, multiple, or inconsistent obligations. The mere possibility that two lawsuits may come to different determinations of the facts (for example that D might be found not negligent in P's suit but negligent in X's) is not an inconsistent obligation of the sort that would create a necessary party.

 

A surprisingly large number of people messed up this very straightforward question. X is not claim precluded, because he was neither a party not in privity with a party in the earlier litigation. His right to compensation for his damages in the accident has not been litigated. That he could have intervened is irrelevant to whether he is claim precluded. 

We did encounter cases of nonmutual claim preclusion in class, but those were completely irrelevant to this scenario. They involved narrow cases in which someone who was not a party in the earlier litigation could use claim preclusion against someone who was a party in the earlier suit - eg when a plaintiff sues an employee for compensation and then, losing, sues the employer under respondeat superior concerning the same acts of the employee. (Notice that this is an example of claim preclusion, not solely issue preclusion, because the employer could prohibit the plaintiff from suing concerning causes of action or categories of damages that had not been brought up in the suit against employee.) The current question is nothing like such a situation, however, not merely because you have no employer-employee relation between X and anyone in the earlier litigation, but also because X, the non-party in the earlier suit, is the one against whom claim preclusion would be asserted. 

How about issue preclusion? Once again, the fact that X was not a party or in privity with a party in the earlier litigation means he cannot be issue precluded. We did encounter some cases in class (on the cutting edge of issue preclusion law, not yet generally recognized) in which someone who was not a party or in privity with a party in the earlier suit could nevertheless be issue precluded. In addition, it was relevant whether the person to be issue precluded could have intervened in the earlier action, something also true of X. But the ability to intervene was not sufficient. It was also required that the absence of issue preclusion would have submitted someone who was a party in the earlier action to double, multiple, or otherwise inconsistent obligations. In other words, the party to be issue precluded had to have been a necessary party in the earlier action. (The way we put it in class is that the precluded party could have intervened of right.)

An example that we discussed in class of a case in which non-parties could be issue precluded under this cutting-edge doctrine is when African-American applicants for positions in a fire department sue the department to compel it to establish a system of preferential hiring as a remedy for discriminatory employment decisions. If the plaintiffs win, there is an argument that prospective white applicants for positions in the fire department who could have intervened in the earlier suit but did not should be issue precluded from challenging the constitutionality of the remedy. The fire department could be whipsawed with incompatible injunctions if the white applicants are not issue precluded. The white applicants would be able to sue and get an injunction forbidding the preferential treatment program even though the department is already subject to an injunction requiring the program.

But there is NOTHING like that here.

Some of you argued that issue preclusion was not applicable because there was no overlap of issues: The fact that P and D were not negligent with respect to each other does not mean that they were not negligent with respect to X. That is possible, but it is also possible that P and D were negligent with respect to each other if and only if they were negligent with respect to X. For example, if X's claim is that P or D were negligent because they were texting when the accident happened, and it was found in P v. D that neither was negligent because neither was texting, there would an overlap of issues. The important point is that even if there was an overlap of issues, X cannot be issue precluded.

Some of you argued that issue preclusion did not apply because the findings that P and D were not negligent were not necessary to the earlier judgment, because either would have been sufficient on its own. That's false. In fact, the determination that D was not negligent was necessary to the judgment for D. As for the finding that P was not negligent, it was neither necessary nor sufficient for the judgment.

That X was not a necessary party in P v. D should also be clear from what I said in the ideal answer.

An extra point was awarded for noting that the relevant preclusion law is Connecticut's (although every jurisdiction's preclusion law is the basically same on these matters) and that this obligation on the federal court to use Connecticut's issue preclusion law followed from the full faith and credit statute. An extra points was also awarded for recognizing that Connecticut's law of necessary parties would be relevant to P v. D - you had to assume that Connecticut had something like FRCP 19 to answer the question.