Brief Fact Summary.
Jacobson (Plaintiff) succeeded in a suit against Miller (Defendant) for missed rent payments when Defendant did not challenge the execution of the lease. In a later action for further missed payments under the same lease, Defendant claimed the lease was not executed and Plaintiff offered the first judgment as proof that it had been.
Synopsis of Rule of Law.
A defendant may raise a defense in a subsequent lawsuit that he did not raise in previous litigation of a different claim that concerned the same issues.
As a practical matter, the Court realizes that there are various reasons why a Defendant might choose to allow a default judgment to be entered against him, including the smallness of the amount or the value of the property in controversy, the difficulty of obtaining the necessary evidence, the expense of the litigation, and his own situation at the time.View Full Point of Law
Plaintiff sued Defendant for rent installments under a lease. Defendant did not raise the issue of whether the lease was executed and Plaintiff was awarded a judgment. Plaintiff later sued Defendant again for further missed rent installments under the same lease. In this second action, Defendant argued that the lease was never executed. Plaintiff offered the judgment in the first action as proof that the lease was executed and was again awarded a judgment. Defendant appealed.
Can a defendant raise a defense in a lawsuit that he did not raise in previous litigation involving the same issues but a different claim?
Cooley, J.) Yes. A defendant may raise a defense in a subsequent lawsuit that he did not raise in previous litigation of a different claim that concerned the same issues. Although he could have raised the issue in the first suit, Defendant admitted the execution of the lease by default. While public policy does not allow a party to withhold a defense in order to obtain an advantage in later litigation, there are potentially other explanations for Defendants failure to raise the issue in the first lawsuit, such as expense, or difficulty in obtaining the necessary evidence. Therefore, Defendant should not be barred from raising the defense in the second action. A judgment in a previous action does not transform the complaint from that earlier action into evidence in the second suit concerning a different claim. Reversed and remanded for a new trial.
The court’s analysis could lead to a view that an issue is open for future litigation whenever it is decided by default in an action. An alternate view would estop Defendant from raising the issue of lease execution because the previous judgment is conclusive upon the rights to rent under the same lease.