Strong v. Williams ( 2018 )

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THE SUPREME COURT OF THE STATE OF ALASKA
JOHN STRONG, )
) Supreme Court No. S-16730
Appellant, )
) Superior Court No. 3AN-15-08446 CI
v. )
) OPINION
JAMES WILLIAMS, SUZIE )
WILLIAMS, and MUNICIPALITY ) No. 7321 – December 14, 2018
OF ANCHORAGE, )
)
Appellees. )
)
Appeal from the Superior Court of the State of Alaska, Third
Judicial District, Anchorage, Andrew Guidi, Judge.
Appearances: Kenneth P. Jacobus, Kenneth P. Jacobus, P.C.,
Anchorage, for Appellant. Samuel C. Severin, Assistant
Municipal Attorney, and Rebecca A. Windt Pearson,
Municipal Attorney, Anchorage, for Appellee, Municipality
of Anchorage. Notice of nonparticipation filed by David W.
Pease, Burr, Pease & Kurtz, Anchorage, for Appellees James
Williams and Suzie Williams.
Before: Stowers, Chief Justice, Winfree, Maassen, Bolger,
and Carney, Justices.
CARNEY, Justice.
I. INTRODUCTION
A man sued his neighbors, alleging that an access road on their property
caused flooding on his property. After he reached a settlement with the neighbors, the
man stipulated to a dismissal of his claims with prejudice. Three years later the man
again sued the neighbors as well as the Municipality of Anchorage, alleging that the
flooding had continued and asserting new claims of nuisance, trespass, intentional
infliction of emotional distress, and breach of contract. The superior court granted
summary judgment for the Municipality on the basis of either collateral estoppel or res
judicata. The man appeals; we reverse the grant of summary judgment and remand for
further proceedings.
II. FACTS AND PROCEEDINGS
A. Facts
John Strong has owned property in Anchorage since 1974. He alleges that
his house and property have regularly flooded since the neighboring landowners built an
access road to their property in the 1980s. The Municipality became aware of the
flooding by 1993.1
James and Suzie Williams owned the property by 2010, when Strong
initiated his first lawsuit related to the flooding. Strong sued them for trespass and
nuisance and asked the court to order them to abate the flooding and award Strong
compensatory and punitive damages.
1
The parties dispute what occurred in 1993 and the superior court made no
findings related to it. Strong alleged that the Municipality “declared the dam a nuisance
and issued an abatement order.” The Municipality stated that it issued a notice to the
owners of the neighboring property that the condition of the premises constituted a
nuisance and was subject to abatement by timely compliance.
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In March 2011 Strong signed a Release and Settlement Agreement releasing
the Williamses from any and all claims related to Strong’s property damage or the access
road. He released the claims in exchange for $7,500 and an agreement that the
Williamses would upgrade the driveway according to agreed-upon specifications. The
agreement stated that the parties intended to “release all individuals, firms, or
corporations who could at any future date be possible defendants in any action arising
out of the claims.”
Strong filed a stipulation to dismiss all claims with prejudice in July 2012.
The superior court accepted the stipulation and dismissed the lawsuit.
B. Proceedings
In July 2015 Strong filed another complaint against the Williamses and
added the Municipality of Anchorage. He again alleged that his property had frequently
flooded since the access road was built in the 1980s. Strong contended that the
Municipality had declared the road a nuisance but had never enforced an abatement
order. He brought claims of nuisance, intentional infliction of emotional distress (IIED),
trespass, and breach of contract against the Williamses and the Municipality. Strong
asked the superior court to order the defendants to remove the access road and take steps
to restore the flow of groundwater that it had obstructed. He also asked the court to
award him compensatory damages for repairs, mental anguish, and the costs of
addressing the flooding, as well as punitive damages and attorney’s fees.
The Municipality answered his complaint less than a month later, arguing
that Strong’s claims were barred by a number of doctrines, including res judicata and
collateral estoppel. Strong admitted in response to discovery requests that he was
seeking only equitable, not monetary, relief from the Municipality and was not claiming
trespass or IIED against the Municipality.
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Nearly a year later the Municipality filed a motion for summary judgment
arguing that collateral estoppel (or issue preclusion) barred Strong’s claims.2 The
Municipality also contended that, because it was not a party to the earlier settlement
between Strong and the Williamses, it could not be liable for any breach of contract
claim. Strong opposed the motion and the superior court heard oral argument in
December.
The superior court orally ruled that “[c]ollateral estoppel applies with
regard to claims based on everything that was settled to the same extent that it applies in
favor of the Williams[es]” and that there could be no breach of contract claim against the
Municipality because it was not a party to the settlement agreement. The court gave
Strong 30 days to amend his complaint to state a viable claim against the Municipality;
he did not file an amended complaint.
On April 12, 2017 the superior court issued a written decision granting
summary judgment to the Municipality. It relied on a different theory in its written
decision than its oral decision to find that Strong’s claims were precluded: it held that
res judicata barred Strong’s nuisance and trespass claims against the Municipality and
that collateral estoppel barred Strong’s IIED claim. The court also granted judgment to
the Municipality on Strong’s claim for breach of contract because the Municipality was
not a party to the settlement agreement. The court dismissed the Municipality as a party
and entered final judgment in its favor.
Strong appeals.
III. STANDARD OF REVIEW
When an appeal “involves a ruling on summary judgment and presents a
question of law,” we “apply a de novo standard of review, ‘adopting the rule of law that
2
The Williamses joined in the Municipality’s motion.
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is most persuasive in light of precedent, reason, and policy.’ ”3 “The question whether
res judicata or collateral estoppel applies is a question of law, which we . . . review de
novo.”4
IV. DISCUSSION
Strong does not appeal the dismissal of his breach of contract claim and he
admitted during discovery that he was not suing the Municipality for IIED.5 We
therefore consider only Strong’s nuisance and trespass claims.
The superior court gave two different explanations for granting summary
judgment on the nuisance and trespass claims. It relied on collateral estoppel in its oral
findings and res judicata in its written findings. Because “[w]e may affirm a grant of
summary judgment on any basis appearing in the record,”6 we consider both theories.
We find that neither theory supports the grant of summary judgment and therefore
reverse.
A. Res Judicata Does Not Apply.
The trial court ruled that res judicata precluded Strong’s trespass and
nuisance claims against the Municipality in its written decision. Neither party explicitly
raises the issue of res judicata on appeal, but Strong implies that res judicata does not
apply because he argues there was a lack of privity between the Williamses and the
3
State Farm Mut. Auto. Ins. Co. v. Dowdy, 192 P.3d 994, 998 (Alaska 2008)
(quoting State Farm Mut. Auto. Ins. Co. v. Lestenkof, 155 P.3d 313, 316 (Alaska 2007)).
4
McElroy v. Kennedy, 74 P.3d 903, 906 (Alaska 2003).
5
Strong admitted during discovery that he was not bringing a trespass claim
against the Municipality, but because the Municipality does not argue on appeal that he
waived it, we will address it.
6
Parson v. State, Dep’t of Revenue, Alaska Hous. Fin. Corp., 189 P.3d 1032,
1036 (Alaska 2008).
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Municipality. To address this argument we examine the doctrine of res judicata and its
application to this case.
“A judgment is given res judicata effect by this court when it is (1) a final
judgment on the merits, (2) from a court of competent jurisdiction, (3) in a dispute
between the same parties (or their privies) about the same cause of action.”7 The
Municipality was not a party to Strong’s first lawsuit. The lawsuit’s dismissal with
prejudice cannot have a res judicata effect against the Municipality because it does not
satisfy the third prong: it does not involve the same parties or parties in privity. We
have stated that
[A] non-party will be found to have been in privity with a
party to a prior legal proceeding only if that non-party
“(1) substantially participated in the control of a party’s
presentation in the adjudication or had an opportunity to do
so; (2) agreed to be bound by the adjudication between the
parties; or (3) was represented by a party in a capacity such
as trustee, agent, or executor.”[8]
None of these circumstances apply. Because the Municipality was not in privity with the
Williamses, res judicata cannot apply.
B. Collateral Estoppel Does Not Apply.
We next examine whether collateral estoppel, also called issue preclusion,
applies. We have stated:
Collateral estoppel prohibits relitigation of issues actually
decided in earlier proceedings where: (1) the party against
whom the preclusion is employed was a party to or in privity
7
Patterson v. Infinity Ins. Co., 303 P.3d 493, 497 (Alaska 2013) (quoting
Angleton v. Cox, 283 P.3d 610, 614 (Alaska 2010)).
8
State, Dep’t of Health &Soc. Servs., Office of Children’s Servs. v. Doherty,
167 P.3d 64, 73 (Alaska 2007) (quoting Powers v. United Servs. Auto. Ass’n, 6 P.3d 294,
298 (Alaska 2000)).
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with a party to the first action; (2) the issue precluded from
relitigation is identical to the issue decided in the first action;
(3) the issue was resolved in the first action by a final
judgment on the merits; and (4) the determination of the issue
was essential to the final judgment.[9]
Strong argues that collateral estoppel does not apply because no issues were actually
litigated and decided by the dismissal. We agree.
We have held that a stipulation to dismiss claims with prejudice has “the
same res judicata effect as a final judgment after trial.”10 The Municipality argues that
we should apply this principle to our collateral estoppel analysis. But in Conitz v.
Alaska State Commission for Human Rights we recognized an important difference
between the two doctrines: “[I]t is not a requirement of res judicata that an issue was
actually litigated, only that there was an opportunity to litigate it.”11 On the other hand,
collateral estoppel requires that “the issue was resolved in the first action by a final
judgment on the merits.”12 The issue therefore must “actually be litigated.”13 In
Jackinsky v. Jackinsky we explained that the “settlement prevented any issues from
actually being litigated or determined.”14 Citing the Restatement (Second) of Judgments
section 27, we observed that this section “provides that the determination of actually
9
State, Dep’t of Revenue v. BP Pipelines (Alaska) Inc., 354 P.3d 1053, 1068
(Alaska 2015) (quoting Ahtna, Inc. v. State, Dep’t of Transp. &Pub. Facilities, 296 P.3d
3, 8 (Alaska 2013)).
10
Tolstrup v. Miller, 726 P.2d 1304, 1306 (Alaska 1986).
11
325 P.3d 501, 509 (Alaska 2014).
12
BP Pipelines (Alaska) Inc., 354 P.3d at 1068 (quoting Ahtna, Inc., 296 P.3d
at 8).
13
See In re Adoption of A.F.M., 15 P.3d 258, 268 n.46 (Alaska 2001).
14
894 P.2d 650, 655 (Alaska 1995).
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litigated issues will have preclusive effect in later litigation.”15 We quoted from section
27:
When an issue of fact or law is actually litigated and
determined by a valid and final judgment, and the
determination is essential to the judgment, the determination
is conclusive in a subsequent action between the parties,
whether on the same or a different claim.[16]
In the case before us, just like in Jackinsky, the “settlement prevented any issues from
actually being litigated or determined.” Thus the issues in Strong’s complaint were not
actually litigated. The stipulation to dismiss Strong’s claims did not determine any
factual or legal issues that might apply to claims against the Municipality.
We have previously recognized that “issue preclusion ordinarily does not
attach [to a stipulation] unless it is clearly shown that the parties intended that the issue
be foreclosed in other litigation.”17 The Release and Settlement Agreement does not
demonstrate such an intent. The settlement agreement was a “full and final compromise
and settlement of any and all claims, disputed or otherwise, arising out of the allegations
resolved by the Release and Settlement Agreement.” (Emphasis added.) It also stated
that the parties intended to release all future possible defendants “in any action arising
out of the claims settled.” This language demonstrates that the parties intended to settle
the claims brought by Strong, not to finally determine the factual or legal issues in the
lawsuit.
15
Id.
16
Id. (quoting Restatement (Second) of Judgments § 27 (1982)).
17
Morris v. Horn, 219 P.3d 198, 209 (Alaska 2009) (alteration in original)
(quoting 18A CHARLES ALAN WRIGHT, ARTHUR R. MILLER & EDWARD H. COOPER,
FEDERAL PRACTICE AND PROCEDURE § 4443 (2d ed. 2009)).
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Strong analogizes this case to Sowinski v. Walker, where we considered the
preclusive effect of a stipulation and settlement agreement on a subsequent legal
proceeding.18 We found that the settlement, which provided that an access road was
public land, did not determine the scope of the State’s duty to maintain that road.19
Because no court had adjudicated the scope of the State’s duty, we held that collateral
estoppel could not apply.20 Similarly, in this case the settlement agreement in the earlier
litigation does not determine the cause of the flooding or the scope of the Municipality’s
responsibility. Without a determination of factual or legal issues in that action, there is
no determination of those issues that can have a preclusive effect in this one.21
V. CONCLUSION
We REVERSE and REMAND for further proceedings in accordance with
this opinion.22
18
198 P.3d 1134, 1140-43, 1147-48 (Alaska 2008).
19
Id. at 1148.
20
Id.
21
We do not address the parties’ arguments about other elements of collateral
estoppel or whether it was an abuse of discretion to apply collateral estoppel under the
circumstances of this case.
22
On remand the superior court may require Strong to clarify his claims and
the relief he is seeking from the Municipality, as it remains unclear whether he has a
viable claim against the Municipality.