Res Judicata and Collateral Estoppel in Car Accident Lawsuits

In a car accident lawsuit, once a final judgment on the merits has been rendered on a particular cause of action, the plaintiff is barred by res judicata from trying the same cause of action in a later lawsuit.  For res judicata to apply, (1) the claim at issue must be related to the same transaction or occurrence of a previously litigated claim, (2) the claim at issue must involve the same parties as the previously litigated claim, and (3) there must be a final judgment on the merits of the case.

For example, when Pat brought claims against Busco, she brought two causes of action, one for negligent hiring of an obese driver who had a heart attack on the road, and another for property damages. The negligent hiring had been litigated in a lawsuit between Ed, a third party and Busco, but the property damages action was not.  Although the negligent hiring claim Pat brought against Busco was identical to that brought against Busco by Ed, a third party, Pat was not a party to the litigation or notified of the action with Ed. Thus, res judicata did not apply to Pat’s claims.  This means Pat can still litigate against Busco for both negligent hiring and property damages.  Busco could be sued twice.

A judgment for plaintiff or defendant is conclusive in a subsequent action on a different cause of action between them or their privies, as to issues actually litigated and essential to the judgment in the first action.  For collateral estoppel to apply, the issue of fact must have been a subject of trial, with evidence presented and a decision rendered by the trier of fact.  While traditional mutuality rules forbid use of collateral estoppel against a person who was not a party, modern rules apply collateral estoppel to a nonparty when (1) the identical issue is decided in the first case, (2) there is a final judgment on the merits, (3) the party to whom collateral estoppel is applied has a fair opportunity to be heard in the earlier case, and (4) it will not be unfair or inequitable to apply collateral estoppel.

For example, continuing with the facts above, suppose Pat and Busco got into a bus accident.  On Pat’s property damage claim, Pat would claim Busco was liable for a bus accident. Although the negligent hiring on the obese driver had been litigated to a final judgment, the property damage liability was not.  The property damage action should be litigated.  As to Pat’s negligent hiring claim, it was litigated in the action between Ed and Busco. Busco was a party in Ed’s litigation.  If Busco had won in the earlier litigation against Ed because the trier of fact had found that there was no negligent hiring, then Busco would assert collateral estoppel against Pat.  Busco had an opportunity to litigate the contract issues in the previous case, it was foreseeable to Busco that collateral estoppel might arise in the future from the contract issue.  Mutuality is not met because Pat was not a party to the previous action, but modernly, use of collateral estoppel when there is no mutuality is allowed.

Contact a personal injury attorney in the Philadelphia, PA area if you get injured in a car accident, as you may be able to receive compensation for property damages or personal injuries.