Res Judicata / Privity - Sims v. JPMC Specialty Mortgage, LLC


Sims v. JPMC Specialty Mortgage, LLC, [Ms. 2150437, Aug. 26, 2016] __ So.3d __ (Ala. Civ. App. 2016). This complex mortgage foreclosure, ejectment, trespass, conversion, and declaratory judgment action raises, in the context of cross motions for summary judgment, issues of res judicata and privity.

First, the court holds that JPMC and Chase properly filed a motion for summary judgment on the grounds of res judicata when they had not previously filed an answer asserting res judicata as an affirmative defense. The court reiterates the principle earlier established in Marlow v. Mid-South Tool Co., 535 So.2d 120, 125 (Ala. 1988) ("If a defendant moves for summary judgment before he files an answer, any affirmative defense argued in support of the motion for summary judgment has not been waived.... Only if an answer fails to assert an affirmative defense that is argued in a subsequently filed motion for summary judgment is the affirmative defense deemed waived.").

The court then recites the elements of res judicata:

"'The elements of res judicata are "'(1) a prior judgment on the merits, (2) rendered by a court of competent jurisdiction, (3) with substantial identity of the parties, and (4) with the same cause of action presented in both actions.'" Chapman Nursing Home, Inc. v. McDonald, 985 So.2d 914, 919 (Ala. 2007)(quoting Equity Res. Mgmt., Inc. v. Vinson, 723 So.2d 634, 636 (Ala. 1998)).'

"Ex parte Chesnut, [Ms. 1140731, Jan. 22, 2016] __ So.3d __, __ (Ala. 2016)."

Osborne v. Osborne, [Ms. 2150319, May 13, 2016] __ So.3d __, __ (Ala. Civ. App. 2016).

Ms. *20-21. Focusing on the "substantial identity of the parties" requirement, the Court of Civil Appeals finds genuine issues of material fact. The court first notes that the substantial identity requirement generally requires parties to be identical, but that there is an exception to this rule for "parties in privity with a party to the prior action." Ms. *21, quoting Greene v. Jefferson County Comm'n, 13 So.3d 901, 912 (Ala. 2008). The privity requirement has, in turn, been summarized as follows:

"'The term "privity" has not been uniformly defined with respect to res judicata. The following three definitions have appeared in Alabama cases: (1) the relationship of one who is privy in blood, estate, or law; (2) the mutual or successive relationship to same rights of property; and (3) and identity of interest in the subject matter of litigation. Largely defining privity by example, the Alabama cases seem to resolve the question on an ad hoc basis in which the circumstances determine whether a person should be bound by or entitled to the benefits of a judgment. The decision usually turns on whether the relationship between the parties was close enough and whether adequate notice of the action was received by the privy; this test has been bolstered by the recent tendency of the Alabama courts to analyze privity as an identity of interest.'

"Hughes v. Martin, 533 So.2d 188, 191 (Ala. 1988)(quoting Issue Preclusion in Alabama, 32 Ala. L. Rev. 500, 520-21 (1981)). Therefore, '"[a] person may be bound by a judgment even though not a party to a suit if one of the parties to the suit is so closely aligned with his interests as to be his virtual representative."' Brown v. Brown, 680 So.2d 321, 323 (Ala. Civ. App. 1996)(quoting Green v. Wedowee Hosp., 584 So.2d 1309, 1315 (Ala. 1991))."

Ms. *21-22. Continuing, the court notes that "privity" is a flexible legal term,

" ' "[C]omprising several different types of relationships and generally applying when a person, although not a party, has his interests adequately represented by someone with the same interests who is a party." ' " McDaniel v. Harleysville Mut. Ins. Co., 84 So.3d 106, 112 (Ala. Civ. App. 2011)(quoting Jim Parker Bldg. Co. v. G & S Glass Supply Co., 69 So.3d 124, 132 (Ala. 2011), quoting in turn EEOC v. Pemco Aeroplex, Inc., 383 F.3d 1280, 1286 (11th Cir. 2004))." ' "

Ms. *24. Because there was evidence which, when viewed in a light most favorable to the non-movant, could support the conclusion that the appellant's interest in the property at issue was different from his predecessor's interest in that property, genuine issues of material fact existed which precluded summary judgment on the affirmative defense of res judicata.

Related Documents: Sims v JPMC Specialty Mortgage

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