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[Latin, A thing adjudged.] A rule that a final judgment on the merits by a court having jurisdiction is conclusive between the parties to a suit as to all matters that were litigated or that could have been litigated in that suit.
The U.S. legal system places a high value on allowing a party to litigate a civil lawsuit for money damages only once. U.S. courts employ the rule of res judicata to prevent a dissatisfied party from trying to litigate the issue a second time.
Res judicata will be applied to a pending lawsuit if several facts can be established by the party asserting the res judicata defense. First, the party must show that a final judgment on the merits of the case had been entered by a court having jurisdiction over the matter. This means that a final decision in the first lawsuit was based on the factual and legal disputes between the parties rather than a procedural defect, such as the failure to serve the defendant with legal process.
Once a court makes a final decision, it enters a final judgment in the case. The judgment recites pertinent data about the case, such as the names of the parties, the fact that a jury verdict was rendered, and the disposition made. The judgment is filed with the court administrator for that judicial jurisdiction.
The party asserting res judicata, having introduced a final judgment on the merits, must then show that the decision in the first lawsuit was conclusive as to the matters in the second suit. For example, assume that the plaintiff in the first lawsuit asserted that she was injured in an auto accident. She sues the driver of the other auto under a theory of negligence. A jury returns a verdict that finds that the defendant was not negligent. The injured driver then files a second lawsuit alleging additional facts that would help her prove that the other driver was negligent. A court would dismiss the second lawsuit under res judicata because the second lawsuit is based on the same cause of action (negligence) and the same injury claim.
Under the companion rule of collateral estoppel, the plaintiff will not be allowed to file a second lawsuit for money damages using a different cause of action or claim. Under collateral estoppel, the parties are precluded from litigating a second lawsuit using a different cause of action based on any issue of fact common to both suits that had been litigated and determined in the first suit. For example, the plaintiff who lost her auto accident case based on a theory of negligence cannot proceed with a second lawsuit based on an allegation that the driver intentionally struck her auto, thus making it an intentional tort cause of action. A court would assert collateral estoppel because the plaintiff could have alleged an intentional tort cause of action in the original complaint.
The application of res judicata and collateral estoppel produces finality for the parties and promotes judicial economy. Parties know that when final judgment is entered and all appeals are exhausted, the case is over and the decision will be binding on all issues determined in the lawsuit.