Early v King

[*1] Early v King 2009 NY Slip Op 50453(U) [22 Misc 3d 1135(A)] Decided on March 17, 2009 Supreme Court, Bronx County Roman, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on March 17, 2009
Supreme Court, Bronx County

Deborah Early, Plaintiff(s),

against

Marcus A. King, EDITH STAPLETON, EDWARD I. MITCHELL, AND 180 CONNECT, INC., Defendant(s).



17107/05

Nelson S. Roman, J.

Non-party LIBERTY MUTUAL INSURANCE COMPANY (Liberty), seeks an Order declaring that it is not collaterally estopped from litigating the liability of its insured defendant EDWARD I. MITCHELL's (Mitchell) in an action brought by Mitchell against Liberty, titled Mitchell v. Liberty, Index No.301826/07 (hereinafter "SUM action") by virtue of this Court's prior Decision and Order, dated May 23, 2008. Liberty asserts that it cannot be collaterally estopped from litigating Mitchell's liability in the SUM action insofar as Liberty, a non-party to the instant action, did not have an opportunity to fully and fairly litigate the issue of Mitchell's liability when the same was decided by this Court's aforementioned Decision and Order. Alternatively, Liberty seeks to intervene in the instant action pursuant to CPLR §1013, and upon intervention seeks to renew this Court's aforementioned Decision and Order. Liberty asserts that intervention is warranted insofar as it has a substantial right in the outcome of this action and insofar as this action and the SUM action share common questions of law and fact. Liberty contends that upon intervention renewal of this Court's aforementioned Decision and Order, reversal of the same is warranted on grounds that there exist evidence, previously not presented to the Court, which evinces that Mitchell was negligent in the operation of his vehicle. Mitchell, as plaintiff in the SUM action, opposes the instant motion. Mitchell contends that insofar as he and Liberty are privies, Liberty is charged with having had a full and fair opportunity to litigate the issue of Mitchell's liability resulting in this Court's prior Decision and Order, and thus Liberty is collaterally estopped from contesting said liability in the SUM action. Based on this, Mitchell avers that intervention is unwarranted. Mitchell also contends that intervention is unwarranted insofar as Liberty's goal subsequent to intervention is to assert that Mitchell is liable in the instant action and such a position is barred by judicial estoppel. Lastly, Mitchell contends that renewal of this Court's prior Decision and Order is not warranted insofar as the evidence sought to be proffered by Liberty was in fact available but never tendered when this [*2]Court issued its prior Decision and Order. Mitchell as defendant to the instant action and defendant 180 CONNECT, INC. (180) oppose the instant motion insofar as renewal is sought by Liberty, a non-party.

For the reasons that follow hereinafter, Liberty's motion is denied.

The instant action is for alleged personal injuries. The complaint alleges that on May 1, 2005, plaintiff was injured when she was involved in a motor vehicle accident with vehicles owned and operated by the defendants. In particular it is alleged that the accident occurred at or near Peninsula Boulevard and Sycamore Avenue, Hempstead, NY. It is further alleged that plaintiff was a passenger in a vehicle owned by 180 and operated by Mitchell when the same came into contact with a vehicle owned by defendant EDITH C. STAPLETON (Stapleton) and operated by defendant MARCUS A. KING (King). It is alleged that defendants were negligent in the ownership, maintenance and operation of their respective vehicles and that said negligence caused the accident alleged and the injuries that stemmed therefrom.

In support of the instant motion, Liberty submits a copy plaintiff's summons and complaint and a copy Mitchell and 180's answer.

Liberty submits a copy of Mitchell's summons and complaint in the SUM action, wherein Mitchell alleges the following. On May 1, 2005, Mitchell, while operating a motor vehicle owned by 180 was involved in an accident with a vehicle owned by Stapleton and operated by King. Said accident occurred at the intersection of Peninsula Boulevard and Sycamore Avenue, Hempstead, NY. Stapleton and King were negligent with regard to the operation and maintenance of their vehicle and said negligence caused the accident herein as well as injuries sustained by Mitchell. Subsequent to the accident Mitchell learned that the Stapleton/King vehicle was uninsured and as such Mitchell seeks to recover uninsured/under-inured motorist benefits as per the policy of insurance issued by Liberty to 180.

Liberty submits a copy of this Court's Decision and Order dated May 23, 2008 wherein this Court granted Mitchell and 180's motion for summary judgment. Based on the evidence submitted, the Court, concluded, inter alia, as prayed for by Mitchell and 180, that Mitchell was in no way negligent in the operation of his vehicle and that as such he and 180 were entitled to summary judgment. Said motion was decided without opposition and on default.

Liberty submits Timothy Lewis' (Lewis) deposition transcript, wherein he testified, in pertinent part, as follows. On May 1, 2005, while a passenger in a vehicle operated by King, he was involved in an accident at the intersection of Peninsula Boulevard and either Graham Street or Sycamore Avenue. King was driving on Peninsula Boulevard and upon entering the intersection with a green light, his vehicle was impacted by a white truck.

Liberty submits a host of other evidence, not pertinent to the Court's decision.

The Court notes, that Liberty, by counsel admits that it is both Mitchell's liability and SUM insurer and that it hired counsel to represent Mitchell and 180 in the instant action and also retained [*3]counsel to represent Liberty in the SUM action brought.

Mitchell as plaintiff in the SUM action submits a host of evidence, not pertinent to the Court's decision.

Mitchell and 180 as defendants in the instant action submit evidence, not pertinent to the Court's decision.

Collateral Estoppel

It is well settled that absent fraud, a judgement obtained with the proper jurisdiction, once rendered, is conclusive, and generally bars the relitigation of the issues underlying said judgment. Ryan v. New York Telephone Company, 62 NY2d 494 (1984). The court in Ryan, in describing the aforementioned principal, stated,

a judgment rendered jurisdictionally and unimpeached for fraud shall be conclusive, as to the questions litigated and decided, upon the parties thereto and their privies, whom the judgment, when used as evidence, relieves from the burden of otherwise proving, and bars from disproving, the facts therein determined.

Id. at 500. The foregoing is supported by sound public policy and is designed to avoid re-litigating decided issues thereby risking inconsistent results. Buechel v. Bain, 97 NY2d 295 (2001).

The aforesaid principal, gives rise to the doctrine of collateral estoppel, a narrower species of the doctrine of res judicata. Id.; Ryan, supra; David v. Biondo, 92 NY2d 318 (1998); Gramartan Home Investors Corp. v. Lopez, 46 NY2d 481 (1979); Lumbermens Mutual Casualty Company v. 606 Restaurant, Inc., 31 AD3d 334 (1st Dept. 2006); Zimmerman v. Tower Insurance Company of New York, 13 AD3d 137 (1st Dept. 2004); Mulverhill v. State of New York, 257 AD2d 735 (3rd Dept. 1999); Tamily v. General Contracting Corporation, 210 AD2d 564 (3rd Dept. 1994). Collateral estoppel prevents a party from relitigating an issue when said issue has been previously litigated and decided against said party or his/her privies. Id. In order to invoke the preclusive effect of the doctrine of collateral estoppel it must be demonstrated that the issue being raised is identical to an issue previously litigated and decided, that the issue is decisive in the present action and was also decisive or resolved in the prior action, and that the party against whom the doctrine is being asserted, or his privies, had full and fair opportunity to contest and litigate the issue in the prior action. Id.; Browing Avenue Realty Corp., v. Rubin, 207 AD2d 263 (1st Dept. 1994); Color by Pergament, Inc., v. O'Henry's Film Works, Inc., 278 AD2d 92 (1st Dept. 2000); Comi v. Breslin & Breslin, 257 AD2d 754 (3rd Dept. 1999).

The relevant inquiry for purposes of collateral estoppel is the identity of issues and as such, that the current and prior actions involve different causes of action or involve different tribunals, is in no way relevant or dispositive. Ryan, supra; Ripley v. Storer, 309 NY 506 (1956); Mulverhill, supra; Tamily, supra. So broad is the doctrine's applicability, that it serves to preclude a party from litigating issues previously resolved against it when raised against new parties not part of the prior action. Corto v. Lefrak, 203 AD2d 94 (1st Dept. 1994). [*4]

With regard to burden, the proponent seeking preclusion on grounds of collateral estoppel has the burden of demonstrating (1) identity and decisiveness of issues in the present and prior action; and (2) identity of parties against whom the issue has decided or privity between the party sought to be precluded and the party against whom the prior issue was resolved. Buechel, supra; Kaufman v. Eli Lilly and Company, 65 NY2d 449 (1985); Lumbermens Mutual Casualty Company, supra. The party opposing the applicability of collateral estoppel has the burden of establishing the absence of a full and fair opportunity to litigate the issue in a prior action. Id. Clearly a party can also bar the applicability of the doctrine upon demonstration that no privity existed between him a prior party or that if it did, his privity did not have a full and fair opportunity to litigate the issue sought to be estopped.

Privity, for purposes of collateral estoppel does not have a technical and well defined meaning. Lumbermens Mutual Casualty Company, supra; Buechel, supra; Watts v. Swiss bank Corporation, 27 NY2d 270 (1970). Instead, the existence of privity, so as to warrant that a party to an action be bound by a prior determination in an action where he was non-party will be found in circumstances where the current party had a cognizable relationship to the party where said determination was made, such as when the current party controlled the prior litigation, where the current party is a successor to a property right from the prior party, or where the current party's interests were represented in a prior action by party to the same. Id.; Green v. Santa Fe Industries, Inc., 70 NY2d 244 (1987); Comi; supra; Tamily, supra; Baldwin; supra. With respect to privity between an insured and its insurer, for collateral estoppel purposes, courts have repeatedly deemed that an insured is generally in privity with its insured, whether or not the insured is a named party in an action. Fadden v. Cambridge Mutual Fire Insurance Company, 51 Misc 2d 858 (Supreme Court, Albany County 1966), aff'd, 27 AD2d 487 (3rd Dept. 1967) (Court granted judgment in favor of plaintiff insured against defendant insurance company on action to recover for covered damages incurred by insured in prior action. Court concluded that litigation of whether accident sued for was excluded under the policy had not been litigated in prior action against the insured and thus could be litigated in the instant action. However, court held that although insurer was not a party to the prior action, for collateral estoppel purposes, he was in privity with the insured who in fact conducted the insured's defense.); Hinchey v. Sellers, 7 NY2d 287 (1959) (Court found that plaintiff's were collaterally estopped from litigating action against defendant insured when issue regarding the same's liability had been decided in prior declaratory judgment action against the insurer. Court held that insured, although not a party to the prior action was in privity with the insurer and issue previously resolved in insurer's favor collaterally estopped plaintiff from litigating same against insured.); Lumbermens Mutual Casualty Company, supra. (Plaintiff Insurer collaterally estopped from litigating issue of negligence against defendant, when said issue had been resolved in defendant's favor in a prior action where plainitff's insured was a named party and was provided counsel by plaintiff insurer. Court found that plaintiff insurer was in privity with the insured in prior action wherein issue of defendant's negligence was decided. Court held that issue in present action had been decided and that plaintiff's privies had ample opportunity to litigate the same.); Culpepper v. Allstate Insurance Company, 31 AD3d 490 (3rd Dept. 2006) (Defendant insurer collaterally estopped from litigating issue of plaintiff's damages insofar as said issue had been decided in prior action by plainitff against defendant's insured. Court held that defendant insurer although not a party in prior action was nevertheless in privity with its insured a named party therein. Court held that in [*5]prior action insurer's interest did not diverge with that of its insured.); Baldwin v. Brooks, 83 AD2d 85 (4th Dept. 1981) (Court found no privity between defendant insured in instant action and defendant's insurer in prior action. Court held that in all cases involving the insured's liability the insured and the insurer are united in interest and thereby have privity between them. Court held that prior action against the insured did not bear on the insured's liability and thus no privity for collateral estoppel purposes existed.); Cf, Russell v. New York central Mutual Fire Insurance Company, 11 AD3d 668 (2nd Dept. 2004) (Court held that insurer was not collaterally estopped from litigating SUM benefits sought by its insured even though it failed to intervene in underlying personal injury action. Court held, without giving a reason, that insurer was not in privity with its insured when underlying personal injury action was litigated.).

When a prior matter has been resolved on default, the defaulting party has not had an opportunity to litigate the matter and as such the doctrine of collateral estoppel does not bar the re-litigation of the prior issue resolved on default. Zimmerman v. Tower Insurance Company of New York, 13 AD3d 137 (1st Dept. 2004). This is because an issue has not been litigated if "there has been a default, a confession of liability, a failure to place a matter in issue by proper pleading or even because of a stipulation." Matter of Abady, 22 AD2d 83, 71 (1st Dept. 2005); Kanat v. Ochsner, 301 AD2d 456 (1st Dept. 2003). The Court does recognize an exception where the doctrine of collateral estoppel will apply when a prior action has been resolved on default; that exception being when a party "has appeared in the prior action or proceeding and has, by deliberate action, refused to defend or litigate the charge or allegation that is the subject of the preclusion request." Matter of Abady, 22 AD2d 83-84, 71 (1st Dept. 2005).

Judicial Estoppel

It is well settled that a party who takes a position in a prior judicial proceeding is estopped from taking a position inconsistent with the same in the same or subsequent proceeding. Matter of Martin, 8 NY2d 226 (1960) (Plaintiff precluded from prosecuting Workers' Compensation claim insofar as his position, for purposes of a prior settlement, was that accident sued for did not fall within the course of his employment as any other position would have barred action against his employer. Court held that former position was inconsistent with the current position thus barring the same under the doctrine of judicial estoppel ); Nestor v, Britt, 270 AD2d 192 (1st Dept. 2000) (Court held that doctrine of judicial estoppel barred petitioner from denying the applicability of a lease, which it had argued ion a previous proceeding bound the respondent.); Karasik v. Bird, 104 AD2d 758 (1st Dept. 1984); Mass v. Cornell University, 253 AD2d 1 (3rd Dept. 1999); Mikkelson v. Schafer, 50 AD3d 1443 (3rd Dept. 2008); Neumann v. Metropolitan Medical Group, P.C., 153 AD2d 888 (2nd Dept. 1989); Clifton Road Associates v. Vinciguerra, 252 AD2d 792 (3rd Dept. 1998); Kasmarski v. Terranova, 115 AD2d 640 (2nd Dept. 1985); Environmental Concern Inc. v.Llarchwood Construction Corp., 101 AD2d 591 (2nd Dept. 1984). This principle is known as judicial estoppel or the doctrine of estoppel against inconsistent positions, which serves to bar a party from changing positions previously asserted in a judicial proceeding merely because it is in the party's interest or serves a tactical purpose. Mas, supra; Mikkelson, supra, Neumann, supra; Kasmarski, supra; Environmental Concerns Inc., supra. The policy which under underpins the principle is that anything less undercuts the administration of justice and the dignity to be accorded to judicial proceedings. [*6]Kasmarski, supra; Environmental Concerns Inc., supra. Invocation of the doctrine is required "lest a mockery be made in the search for the truth." Karasik, supra, at 493. Once the doctrine is asserted and found to apply, the party against whom the same is asserted is bound by his/her prior stance. Clifton Road Associates, supra.

While the doctrine of judicial estoppel ordinarily requires identity of parties, the same has been held to preclude a party to a current action from taking a position inconsistent with one taken by his privies in a prior action. Shaw Family Archives Ltd. v. CMG Worldwide, Inc., 2008 WL 4127830 (SDNY 2008) (Court found that defendants were judicially estopped from taking a position inconsistent with that taken by a party, an estate's executor, in a former action. Court held that insofar as defendants and party to former action were in privity with each other, statements made by defendant, to the extent inconsistent with his privy's prior position, are barred. Basis of privity in that action was that the defendants were beneficiaries of an estate and were thus in privity with executor of same,); Capsopopoulos v. Chater, 1996 WL 717456 (N.D.Ill. 1996) (Plaintiff judicially estopped from taking position inconsistent with that taken by her former and deceased husband in a prior proceeding. Court held that while plaintiff was not a party to her husband's former action, she was his privy and therefore bound by his prior position. Court reiterated that the doctrine of judicial estoppel seeks to prevent a litigants from prevailing twice on opposite theories. Privity found based on the financial interest between wife and deceased husband upon whose account and status wife sought to recover.); Maitland v. University of Minnesota, F.3d 357 (8th Cir. 1994).

Discussion

Liberty's motion seeking a declaration that this Court's Decision and Order, dated May 23, 2008, does not collaterally estopp Liberty from litigating Mitchell's liability in the SUM action is hereby denied.

The doctrine of collateral estoppel prevents a party from relitigating an issue when said issue was previously litigated and decided against said party or his/her privies. In order to invoke the preclusive effect of the doctrine of collateral estoppel it must be demonstrated that the issue being raised is identical to an issue previously litigated and decided, that the issue is decisive in the present action and was also decisive or resolved in the prior action, and the party against whom the doctrine is being asserted or his privies, had full and fair opportunity to contest and litigate the issue in the prior action. With regard to burden, the proponent seeking preclusion on grounds of collateral estoppel has the burden of demonstrating (1) identity and decisiveness of issues in the present and prior action; and (2) identity of parties against whom the issue has been decided or privity between the party sought to be precluded and the party against whom the prior issue was resolved. The existence of privity, so as to warrant that a party to an action be bound by a prior determination in an action where he was non-party will be found in circumstances where the current party had a cognizable relationship to the party against whom said determination was made, such as when the current party controlled the prior litigation, where the current party is a successor to a property right from the prior party, or where the current party's interests were represented in a prior action by party to the same. With respect to privity between an insured and its insurer, for collateral estoppel purposes, courts have repeatedly deemed that an insured is generally in privity with its insured, [*7]whether or not the insured is a named party in an action. This is particularly true in any action where the insured's liability is litigated.

In this action, the evidence demonstrates that Liberty is both Mitchell's liability and SUM insurance carrier. Liberty has provided Mitchell with defense counsel in this action and with regard to the SUM action, Liberty has retained counsel to defend the same. On May 23, 2008 the Court in response to a motion by Mitchell and 180 granted summary judgment in favor of Mitchell and 180 on grounds that Mitchell was neither negligent nor the proximate cause of the accident herein. The Court thus found that Mitchell bore no liability for the within action.

Based on the foregoing, it is beyond cavil that Liberty is collaterally estopped from litigating the issue of Mitchell's liability in the SUM action. All the evidence submitted establishes identity of a decisive issue in both this action and the SUM action and that Liberty's privy, Mitchell, had a fair and full opportunity to litigate the issue of Mitchell's liability when the same was previously decided by this Court. With regard to the identity of a decisive issue in this action and in the SUM action, Mitchell's liability, and more specifically the lack thereof, decisive in granting him and 180 summary judgment, was determined by this Court on May 23, 2008, resolving said issue in Mitchell's favor. Mitchell's liability in this action, is similarly decisive in the SUM action insofar as the collection of SUM benefits is predicated on a finding that Mitchell is not negligent or otherwise liable for the accident herein. Thus, identity if issues is beyond question. With regard to whether Liberty had an opportunity to fully and fairly contest Mitchell's liability in this action, in particular when the prior motion was made, the Court finds that Liberty was in privity with Mitchell who had such an opportunity.

While it is true that Liberty was not a party to the prior action, it is equally true that a party may be collaterally estopped from litigating an issue resolved against its privy in a prior action. Once privity is established the inquiry is whether a party's privy had a fair opportunity to litigate the issue sought to be precluded. In this case, to the extent that Liberty is Mitchell's insured and the prior decision determined Mitchell's liability, Mitchell and Liberty were in privity when Mitchell made the prior motion and when this Court issued its prior decision. Any contention that privity doesn't exists under these circumstances is without merit insofar as case law evinces that in any action where an insured's liability is sought to be resolved, the insured and the insurer are in privity inasmuch as they are united in interest. Moreover, insofar as privity will be found when a party's interest has been fully represented by another, by obtaining summary judgment in his favor, Mitchell fully represented Liberty's interest in this action. After all, at the very least, Liberty has great financial interest in not paying any money occasioned by Mitchell's liability and by obtaining summary judgment, Mitchell promoted and represented that interest. Insofar as Mitchell was the moving party, clearly he had a full and fair opportunity to litigate the issue of his liability. Thus, Liberty's privy, Mitchell, had a full and fair opportunity to litigate the issue of Mitchell's liability. Accordingly, having found identity of a decisive issue and that Liberty's privy had a full and fair opportunity to litigate said issue, Liberty's motion seeking a declaration that this Court's prior Decision and Order does not preclude it from litigating Mitchell's liability in the SUM action is hereby denied. [*8]

Liberty's motion seeking to intervene in the instant action for purposes of renewing this Court's Decision and Order dated May 23, 2008 is hereby denied.

It is well settled that a party who takes a position in a prior judicial proceeding is estopped from taking a position inconsistent with the same in the same or subsequent proceeding. This principle is known as judicial estoppel or the doctrine of estoppel against inconsistent positions, which serves to bar a party from changing positions previously asserted in a judicial proceeding merely because it is in the party's interest or serves a tactical purpose. While the doctrine of judicial estoppel ordinarily requires identity of parties, the same has been applied to preclude a party to a current action from taking a position inconsistent with one taken by his privies in a prior action.

As discussed above, with regard to Mitchell's prior motion seeking summary judgment, this Court finds that Mitchell and Liberty were privies when said motion was made. Based in part on a finding of privity between Liberty and Mitchell, this Court concludes that Liberty is collaterally estopped from litigating the issue of Mitchell's negligence in the SUM action. This privity between Liberty and Mitchell necessarily forms the basis for this Court's conclusion that Liberty is judicially estopped from asserting that Mitchell is negligent or in anyway liable for the accident herein.

While Liberty is not a party to the instant action, the doctrine of judicial estoppel can nevertheless preclude a party from asserting a position inconsistent with one previously taken or asserted by his privy. As discussed above, to the extent that Liberty and Mitchell were privies when Mitchell made his prior motion for purposes of collateral estoppel, this Court must come to the same conclusion for purposes of the applicability of the doctrine of judicial estoppel. As discussed above, insofar as Mitchell's prior motion sought to resolve the issue of his liability, he was united in interest with Liberty and adequately represented those interests , thus establishing privity between Liberty and Mitchell as a matter of law. It is this privity which then binds Liberty and precludes it from asserting a position inconsistent with that which Mitchell has taken in this action and more particularly with the prior motion, said position being that he is not liable for the accident herein. When Mitchell made his prior motion, his position was that he was not liable for the instant accident as he was not negligent in the operation of his vehicle. The Court considering his position and all evidence submitted therewith concluded that Mitchell was not negligent and thus not liable for the accident herein. Liberty now seeks intervention for purposes of renewal, the basis of renewal being that Mitchell, as evinced by Lewis' testimony, was in fact negligent in the operation of his vehicle and thus liable for the accident herein. This position is inconsistent with Mitchell's prior position and insofar as Mitchell and Liberty were privies when the prior motion was made, said position is barred by the doctrine of judicial estoppel.

Notwithstanding the sound legal principles pursuant to which this Court issues its decision, denial of the instant motion promotes sound public policy insofar as it prevents an insurer from taking inconsistent positions simply because it is beneficial to do so. Moreover, an insured should not, when it has an obligation to defend and indemnify, take positions which cast its own insured in liability. An insured, whose obligation is to defend and indemnify its insured should not be allowed to cast the same in liability merely because it doesn't wish to pay portions of its policy. This is exactly what Liberty has sought to do, to the detriment of its insured and worst of all, after its insured [*9]has been exonerated of any liability. Seldom has a procedural history mandated the applicability of the doctrines of collateral and judicial estoppel insofar as the former seeks to prevent the relitigation of previously decided issues so as to avoid inconsistent results while the latter seeks to prevent a litigant from prevailing twice on two theories or otherwise making a mockery of our judicial system.

For the foregoing reason, to the extent that intervention is sought for the limited purpose of renewal, said renewal premised upon Liberty's assertion that Mitchell is negligent in the happening of the accident, the instant application seeking intervention is hereby denied. It is hereby

ORDERED that Mitchell as plaintiff in the SUM action serve a copy of this Order with Notice of Entry upon all parties in this action and in the SUM action within thirty (30) days hereof.

This constitutes this Court's decision and Order.

Dated :March 17, 2009

Bronx, New York

_____________________________

Nelson S. Roman, J.S.C.